Hartman vREIT XXI Suspends Investor Distributions

Posted on February 22nd, 2023 at 4:38 PM
Hartman vREIT XXI Suspends Investor Distributions

Hartman vREIT XXI announced that its sponsor, Hartman Income REIT Management, has indefinitely suspended investor distributions. 

While the company typically has generated a 6% return to investors, a recent letter to shareholders cited rapid upward pressure on interest rates over the past twelve months. Hartman informed shareholders that its weighted average interest rate has reached 7.3%, which constitutes more than double the rate in January 2022, while the total monthly debt service obligation has more than tripled. “While our revenue has increased, we do not anticipate a meaningful decline in interest rates for the 2023 calendar year. Because of that, it is not anticipated that [Hartman vREIT] XXI will be able to pay a distribution for the foreseeable future as we navigate these market conditions”, according to Allen Hartman, executive chairman and chief executive officer. 

Hartman further noted that the board of directors will regularly evaluate the company’s financial outlook to determine when to reinstate investor distributions. Hartman previously suspended the company’s share redemption program and additionally announced its management’s “substantial doubt about the company’s ability to continue as a going concern.”

Eccleston Law LLC represents investors and financial advisors nationwide in securities, employment, regulatory and disciplinary matters.

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