The Parking REIT Offers Investors “No Assurance” Of Liquidity Event

The Parking REIT said in an April, 2020 letter to investors that the option to provide liquidity to shareholders by listing common shares on a stock exchange is “not currently viable” and “there can be no assurance that the company will cause a liquidity event to occur in the near future or at all.”

This is disappointing news for investors in the non-traded REIT, which has already given them quite a bit of disappointment. In March, 2018, The Parking REIT announced that its board had unanimously approved the suspension of all cash distributions and stock dividends. The dividend paid by a non-traded REIT like The Parking REIT was its most appealing quality.

The company is also facing an SEC investigation, is the subject of a class action lawsuit, and is conducting an investigation into possible wrongdoing by CEO Michael V. Shustek.

The Parking REIT History

The Parking REIT was created when 2 separate non-traded REITS, MVP REIT and MVP REIT II, merged to create one new company.

The class action lawsuit against The Parking REIT was filed by a shareholder and alleges that the proxy statements MVP II filed with the SEC to get approval to merge with MVP REIT “contained false and misleading statements, that the director defendants breached their fiduciary duties, and the proposed internalization transaction will unjustly enrich certain directors and officers of the company.”

The company had previously filed a prospectus with the SEC to raise up to $100 million to have an initial public offering and list on NASDAQ under the symbol PARK.

Now, the company says that’s not happening, stating in its letter that the company “faces significant legal expenses related to pending lawsuits, an SEC investigation, and legal and consulting fees in connection with our exploration of potential strategic alternatives to provide liquidity to stockholders.”

CEO Michael Shustek

CEO Michael Shustek is the subject of allegations involving The Parking REIT and affiliated entities, including conflicts of interest regarding his ownership and management of them, and effecting transactions that benefit him at the expense of shareholders.

Shustek also owns and/or is affiliated with, MVP Capital Partners and MVP Realty Advisors. The Parking REIT was been sold by MVP American Securities, a formerly FINRA-registered brokerage firm.

Publicly-available Form D and Form D amendments filed with the SEC list the following firms as receiving sales compensation for selling The Parking REIT:

Accelerated Capital Group;
Centaurus Financial, Inc.;
Coastal Equities, Inc.;
Crown Capital Securities, L.P.;
Forest Securities, Inc.;
Great Point Capital LLC;
NI Advisors;
Sandlapper Securities, LLC;
Whitehall-Parker Securities, Inc.”

Despite The Parking REIT’s issues, investors cannot easily sell it due to its non-traded nature. Non-traded REITS contain significant risks and are not suitable all investors. They also often charge significant fees that erode the value of the investment.

Did You Invest In The Parking REIT?

If you invested in The Parking REIT, MVP REIT, or MVP REIT II, you may to recover losses through FINRA arbitration. If your financial advisor misrepresented the investment to you, or it was unsuitable for your investment needs, contact our firm today to see how we can recover your losses. We take most cases on contingency fee, meaning it costs nothing to hire us.

Silver Law Group is a nationally-recognized law firm representing the interests of investors who have been the victims of investment fraud. Please contact Scott Silver of the Silver Law Group for a no-cost consultation at ssilver@silverlaw.com or toll free at (800) 975-4345.