hi all:
a few people have mentioned starting a blog (or web page) so people who search for SUN1031 TIC's (tenants-in-common) get first hand accounts on the investments they own thru SUN1031. some owners are on an email list. but many are not, so perhaps this will also inform other owners of SUN1031 TIC properties & their dubious dealings.
hopefully, people can do a search & this page will come up to inform people.
MOST of these properties began selling in 2005. recently tho, SUN has a new sale out offering 9.12% returns.
there's plenty of info floating around re: these property investments in SUN1031 (located in AZ) TIC's and their choosing of a management company, CUSA, that did a terrible job while raking money from our investments via high fees. SUN1031 has sat passively by while watching this go on.
SUN 'flipped' properties to investors at a very large profit – most above @ 40% + gain – and without the benefits of appraisals to investors.
SUN1031 also insinuated that the original returns would be ongoing while the property was owned. actually, this was only in the first year of owning. SUN NOW spells that out clearly in offerings.
furthermore, the bank that SUN 1031 did MOST of their financing thru, First Bank of Beverly Hills (FBBH) has been recently seized by the FDIC. gee, wonder why?
the way SUN1031 set up these TIC's they were doomed to have trouble. just a few reasons...
1) overcharging for the properties.
2) choosing a poor management co. who charged HIGH FEES.
3) overstating returns & quality of the properties and the leases.
ok let's see how this goes & please post your stories re: this.
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I own shares in 2 SUN 1031 TICs and my experiences have been the same as disgruntled, perhaps worse. There is clearly fradulent activity with 1 and grossly over charged fees with the other.
ReplyDeletefalling distributions coupled with poor management is a concern for TIC investors. The need for TIC advisory services has never been greater. Does converting to an LLC solve control and financing issues and if it does, how do you do it? What are the tax implications? Can revising the TIC operating agreement be done and is it effective? How realistic is it to sell your TIC
ReplyDeleteMost Sun 1031/CUSA TICS developed steering committees to navigate the switch to new management companies and monitor them. The personal costs in time and money expended by one or more "owner leaders" to benefit the group have been unexpected. At $45 an hour (my paying job) plus travel, I donated more than $21,000 to my TIC, significantly more than my annual return from the property. So much for our "passive" investment.
ReplyDeleteTICS need a structure to spread the true "costs" of TIC leadership more equitably. Some people don't have the skills or desire to help their TIC but there should be an equitable sharing of costs since all share the benefits. Has this been others' experiences? What can be done?
YES, this has been the way things have gone – a couple people doing all the work for the group. i agree there should be some kind of compensation, but i see that as creating other problems too.
ReplyDeletei try to keep thinking that i'm working to better 'my' investment(s). if it means 'others' will also benefit so be it.
this is where SUN COULD've been more of a help. but they've offered NO LEADERSHIP and instead just sit & let these investments go bad. made many investors loss respect in SUN1031 as a company AND people.
Our group has had the same experence as all of you, maybe a class action law suit would get their attention?I am not a sue person but I am in this for almost 1 million dollars my life saving and 40 years of work.I am sure most of you are in the same boat as I am.
ReplyDeleteWas that Frank Sparacino that suggested:
ReplyDelete" so we are now strongly considering not paying the bank note to try & gain leverage."?
That strategy is probably breaking several laws. We should get a copy of our loan papers I think that the bank can hold us accoutable for doing what you propose.
You seem to be saying that the FDIC is conspiring with Sun against us. That seems pretty out there. Once we got more involved with our properties they started doing better, some are better than others of course but 3 of 4 are paying. Paying lawyers is a no win game.
i DID NOT say the fdic was conspiring w/SUN.
ReplyDeleteit was in reference to the FAILED bank (FBBH) that SUN did most (if not ALL) of their business.
3 of 4 properties PAYING? i'd LOVE to see proof of that! unless u mean YOUR 3 of 4 props.
if ur happy with Sun & ur properties & they r paying you, good for you... sincerely.
other have lost EVERYTHING AND had to pay taxes for recaptured depreciation, not me personally but other i've spoken to.
- frank s.
We were led to believe by Sun 1031 that we were going to receive a 7% return on our investment. That lasted for about a year. Then for 15 months our return was zero. We were recently informed that for AT LEAST the next 12 months our return will continue to be zero. We were obligated to offer Sun 1031 the first right of purchasing our portion of the property. Two months later we are still waiting for the courtesy of a response. If ANYONE is considering Sun 1031 or even a 1031 exchange, BEWARE. REQUEST REFERENCES from other 1031 investors. Highly doubtful if Sun can produce any.
ReplyDeleteIf these were bought as a security then you should have some rights if they misrepresented, etc. If not try your state financial authority
ReplyDeleteI have a little different opinion on this. I bought a SUN1031 TIC also. I knew it was a risk like buying property or equities. I am getting 0 for a distribution (I am not happy). The thing is that this scenario can happen with many investments. If it sounds too good, the buyer has to be aware of of the risks and place the blame of themselves also. Just my 2cents...
ReplyDeleteTo Anonymous:
ReplyDeleteYes, of course there are risks. But state and federal securities laws require sellers and sponsors to disclose the specific risks in connection with an investment, along with all material facts. Sun 1031 has a poor track record here and often, if not always, does not follow securities law. We represent many TIC investors unhappy with their investments, including those unhappy with Sun 1031.
Tom Lackman
623-824-6666
If you want a former attorney that has developed millions of office buildings, shopping centers and warehouses together with thousands of acres of land and who has been directly involved in TIC syndications to examine the situation and testify, call me.
ReplyDeleteMike
314/805-3465
Has anyone won a lawsuit against Sun 1031 or has it been a case of throwing good money after bad?
ReplyDeleteBob
404/234-2394
I worked for Sun 1031 for a short period, 3 months I think, and saw that there were "irregularities" with them as well as CUSA. I filed complaints with the Arizona and Georgia Departments of Real Estate. Unfortunately, not much traction. My condolences to all.
ReplyDeleteHello
ReplyDeleteI was also a victim of Sun 1031 questionable business practices. I and about 19 others got involved in a property thru sun in Duluth, Georgia, it will be Foreclosed on by the bank this week.
I ask everyone to get together and finally get the judicial system to see the light about Sun 1031 and CUSA practices.
I will be forwarding this blog to other members in my group and forward it to government and local authorities to have it all looked into. Enough is enough!
Michael
does anyone know of law suits filed against Sun 1031 and if so in what state and when. I know 1 was filed in Idaho but cant find results
ReplyDeleteIf anyone knows of law suit filed against Sun or Cusa please contact me at 406 682 4575
ReplyDelete