Many investors have suffered financial losses in KBS REIT, and are seeking to recover their losses. KBS real estate has been a questionable investment for some, to say the least. The majority of clients who invested in these non-publicly traded real estate did so fully believing it was a secure, safe investment that would be profitable without risking their principal. Of course this was found not to be so. If you have suffered a financial loss after buying shares in KBS REIT, it is important you speak with an attorney who represents investors and who will work vigorously to recover your losses.

How responsible are brokerage firms that have recommended KBS real estate investments to their clients? These brokers and financial advisors should be at least partially liable for the losses their clients have experienced. Unfortunately, unscrupulous stockbrokers often recommend unsuitable products to their clients, particularly if hefty commissions are involved. Still, brokers have a fiduciary duty to perform sufficient due diligence regarding the investments they recommend to clients. In numerous cases in the recent past, firms who have sold KBS real estate to clients have not been able to demonstrate that they did in fact perform adequate due diligence.

For investments such as KBS REIT, it is required under both state and federal securities laws that potential investors are fully informed of all risks related to the product before brokerage firms or financial advisors accept an investor’s subscription. Customers objectives, needs, risk tolerance and often age play an important role in which investments are suitable. However, many brokerages tend to ignore state and federal securities laws, instead advising their clients to invest in KBS real estate and other products that are risky and unsuited to the client, who may be totally unaware of the fact.

The fact is, countless investors have suffered significant financial losses in KBS REIT I and KBS REIT II. The best avenue for pursuing recovery of your loss may be through a FINRA (Financial Industry Regulatory Authority) arbitration claim. The initial offering price of KBS REIT I shares was $10; in 2009 this figure dropped to $7.32 per share. Today, it is estimated that these shares are worth approximately $5.16 each. This is an almost 50% drop for investors, from a non-traded real estate investment trust which has raised in the vicinity of $1.7 billion from investors.

Investors have been informed that no more distributions will be made, and redemptions have reportedly been suspended. Essentially, this means clients who have invested in KBS real estate may have issues should they decide to sell, or face devastating losses if they should sell on the secondary market. All in all, the news is not good for many who invested in KBS REIT. Contact our securities arbitration lawyers who will review your case and work to recover your losses.