Jason Goode, partner with Alston & Bird, joined REIT.com for a video interview at REITWise 2013: NAREIT’s Law, Accounting and Finance Conference in La Quinta, Calif.
Alston & Bird regularly advises and represents public and private REITs. Goode discussed the most pressing issue facing non-listed REITs.
“It’s probably some uncertainty that the industry faces over valuations of REIT shares and how those are going to show up on customer account statements,” he said. “FINRA in 2012 gave the industry some guidance about how they expected and wanted to see valuations of REIT shares on customer account statements, but because of some internal conversations at FINRA, they haven’t finalized those rules and sent them to the SEC . We think that could have an impact on how programs are structured and launched in the future.”
Goode described how the SEC’s disclosure policy of per-share valuations will impact the industry.
“The SEC has really pushed the industry to provide better information about how they are valuing their shares,” he said. “The industry has responded favorably to that, and now we’re seeing a lot better data being presented by issuers about how they are coming up with their per-share valuation.”
Goode also talked about the Department of Labor fiduciary definition, as it relates to public, non-listed REITs.
“There are two U.S. agencies that are focused on this issue, both the Department of Labor and the SEC . There’s been some question as to which would ‘drop the shoe’ first, and we think that the Department of Labor will come out with their proposed rules in July 2013,” he said. “Over the next 12 months, we’re going to learn a lot more about the answer to that question.”