NASAA Requests Comments On Proposal To Amend REIT Guidelines

The North American Securities Administrators Association ("NASAA") requested comment on proposed amendments to the NASAA Statement on Policy Regarding Real Estate Investment Trusts ("REIT Guidelines").

The proposed amendments would:

• limit the amount of an individual's liquid net worth that may be invested in a REIT, its affiliates and other non-traded REITs (although a carve out would be provided for accredited investors) to 10% (the "concentration limit"); however, compliance with the concentration limit requirement would not mean that any suitability requirement imposed on the seller of the REIT also was met; and
• require a sponsor, or any person selling shares on behalf of the sponsor or REIT, to (i) maintain records of the information obtained from shareholders in order to ensure compliance with the concentration limit for a period of at least six years, and (ii) add language to its prospectus disclosing the responsibility of the sponsor, and any