Watermark Lodging Trust REIT: Can I Recover Investment Losses?

Watermark Lodging Trust investors are suffering losses when they attempt to sell their shares 

Sonn Law Group is representing investors who have suffered losses investing in Watermark Lodging Trust. If you or a family member has suffered losses, our securities lawyers want to discuss your case. Please call (844) 689-5754 or contact us online today for a free case review.

Watermark Lodging Trust REITWatermark Lodging Trust is a non-traded real estate investment trust (REIT) that was created after the merger of Carey Watermark Investor and Carey Watermark Investors 1, which occurred in April 2020.

The REIT declared its first post-merger net asset value (NAV) of $5.51 per Class A share and $5.45 per Class T share. Shares were originally sold for $10.00/share so the pricing had dipped by almost 50%. Many investors who originally invested in Carey Watermark Investor are suffering losses of 70% when attempting to sell their shares. 

Watermark Lodging Trust holds ownership interests in over 30 hotels and has been hit hard by the COVID-19 pandemic. According to SEC filings, “[t]he primary factor contributing to the decrease in our NAVs per share is the impact of the COVID-19 pandemic on the hotel portfolio, including the resulting 2020 operating losses and decrease in hotel appraised values.” 

Travel industry analysts have recently stated that they do not expect the travel industry to bounce back in the near future. Watermark Lodging Trust REIT has suspended distribution of redemptions as of March 2020, but investors may submit a special circumstances request to the Board of Directors to receive special consideration for a redemption. 

Non-traded REITs like Watermark Lodging Trust are risky for most investors because they are not as liquid and transparent as most other investments. Despite the risks associated with REITs, they are frequently recommended to elderly, retired investors because they can generate large commission fees for brokers. FINRA and the SEC have issued warnings to investors regarding non-traded REITs, stating that they should only be sold to accredited, high net-worth investors.

Contact Sonn Law Group to Discuss Recovery Options

If you suffered losses investing in Watermark Lodging Trust, please call us now at (844) 689-5754 or complete our contact form.