Tenant-In-Common (TIC) Investments Have Caused Large Losses For Investors
Tenant-In-Common (TIC) investments have led to enormous losses for investors in recent years. Billions of dollars were spent by private investors on TIC investments ranging from apartment complexes and strip malls to large retail centers, golf courses, industrial parks, office parks and oil and gas TICs. TIC sponsors, placement agents, brokers and others promoted and oversold TICs to investors, emphasizing the advantages of 1031 exchanges in misleading sales pitches, and using favorable tax treatment as a distraction so that fundamentally flawed properties could be sold to unsuspecting investors. Private placement memos and other selling documents accentuated the positive and many of them are laden with misleading information and failed to disclose material facts. Many fiduciaries and financial professionals were conflicted by outsized and undisclosed commissions when promoting these investments to investors. Brokers and other professionals encouraged TIC investments despite the fact that many investors were already heavily over-exposed to real estate. Meanwhile, TIC sponsors profited handsomely, with mean resale spreads for sponsors in excess of $4 million per TIC deal, according to industry sources. Investors, however, have not enjoyed similar profits. Investors who have suffered or who expect to suffer large losses on TIC investments should discuss their rights with experienced counsel. To learn more about your rights with respect to losses in TICs, you should contact us and send us your completed TIC questionnaires.
