Latest REIT Fiasco Demonstrates That Investors Need Axiom Valuation’s AIRAS

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Investors in Retail Properties of America Inc., a privately traded REIT, had no idea that the value of their shares had declined by over 50% -- until the fund went public. Axiom Valuation’s AIRAS capability would have given investors early warning that the REIT’s value was declining.

Investors in privately traded or illiquid funds should never be burned again -- now that AIRAS is available.

Investors in Retail Properties of America Inc., a privately traded REIT, had no idea that the value of their shares had declined by over 50% -- until the fund went public. Axiom Valuation’s AIRAS capability would have given investors early warning that the REIT’s value was declining. Instead, when the firm went public this month at $3.20, fund investors were outraged since Fund management indicated last June that the share value was $6.95, as reported by WSJOnline on April 24, 2012. See article at http://online.wsj.com/article/SB10001424052702303459004577364110318098188.html

How can there be such a large discrepancy in such a small period of time? The reason is simple: Investors do not have the wherewithal to assess whether funds like Retail Properties are telling the truth about historical returns and net asset values. Investment consultants treat the returns reported by private REITS, hedge and private equity funds as accurate without testing that this assumption is correct. The fact that funds like Retail Properties are audited once a year is no safe harbor. Auditors have little capacity to provide assurance that fund assets are properly valued. It is no surprise that according to the WSJ article FINRA has seen 54% more complaints regarding non-traded REITs in 2011 than it did in 2009.

AIRAS (Alternative Investment Return Authentication Service) clients are not invested in funds like Retail Properties. AIRAS is the only investment tool that uncovers potential fraud and misreporting of returns and net asset values. AIRAS would have caught Madoff long before his fraud became public. Learn more at http://www.prweb.com/releases/Axiom-Valuation/AIRAS/prweb8621983.htm

The AIRAS analysis is based on established financial research on portfolio replication and uses a sophisticated mathematical optimization procedure. AIRAS reports provide assurance that investors and their agents are not misled and will not fall victim to unscrupulous investment managers. AIRAS clients know better: they “Trust But Verify”.

AIRAS reports are very cost-effective. Just ask endowments and foundations and their auditors whether the value AIRAS offers is worth the cost.

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Dr. Stanley Feldman

John Roberts
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