Bluerock REIT Suspends Sales
The Bluerock Enhanced Multifamily Trust, Inc. has suspended sales. This is not breaking news, as the 8-K announcing the suspension is dated November 11, 2010, and I am just getting around to posting this now. The reason for the sales suspension is that the REIT changed auditors and the new auditors are saying that the REIT has to change the way it accounts for its investments in its properites, and therefore restate its financial reporting, resulting in a new 10-K and new 10-Qs. The REIT's properties are all owned through joint ventures with other, affiliated Bluerock entities and third parties. The REIT needs to file corrected financial statements and a post effective amendment, and be declared effective by the SEC.
I quickly read the Bluerock Enhanced Multifamily Trust's website and saw no mention that it has suspended sales. I had to go to the REIT's most recent filings with the SEC to find the 8-K announcing the sales suspension. This REIT, like the Behringer Harvard Multifamily REIT, has substantial inter-dealings with affiliates and owns its properites through joint ventures. Real Estate funds and REITs that own their properites through Rube Goldberg structures always make me uncomfortable.