Pomerantz Law Firm Launches Class Action Against CTO Realty Growth Inc. and Executives

Class Action Lawsuit Filed Against CTO Realty Growth, Inc.

In a significant legal development, Pomerantz Law Firm has announced the filing of a class action lawsuit against CTO Realty Growth, Inc. (referred to as "CTO") and certain high-ranking officers. The suit, which has been lodged in the United States District Court for the Middle District of Florida, aims to advocate for investors adversely impacted by alleged violations of federal securities laws. The docket number for this case is 25-cv-01516.

Overview of the Class Action

The class action represents a collective of individuals and entities who acquired CTO securities between February 18, 2021, and June 24, 2025 (the "Class Period"). Investors who wish to be recognized as Lead Plaintiffs in this case must file their requests with the court by October 7, 2025. Documentation related to the complaint can be found on the Pomerantz website, and inquiries can be directed to Danielle Peyton via email or phone.

CTO operates as a public real estate investment trust (REIT), focusing on retail properties predominantly located in growing markets across the United States. It transitioned into a REIT in February 2021, maintaining a portfolio of 23 income-generating properties across seven states, including the Ashford Lane retail and dining center in Atlanta, Georgia. The company is obligated, under guidelines from the U.S. Securities and Exchange Commission (SEC), to distribute a minimum of 90% of its taxable income to shareholders as dividends. This arrangement allows the company to enjoy certain tax exemptions.

Allegations in the Lawsuit

The complaint filed by Pomerantz LLP claims that throughout the Class Period, CTO's executives conveyed misleading statements concerning the company's business operations and compliance measures. Specifically, the suit contends that:
1. The sustainability of CTO's dividends was misrepresented to investors.
2. The company allegedly engaged in deceptive practices that inflated its Adjusted Funds from Operations (AFFO) and presented an exaggerated profitability picture for its Ashford Lane property.
3. As a result, CTO’s market performance and financial health were overstated.
4. Accordingly, the public statements made by the defendants were grossly misleading at all necessary times.

These allegations came to public attention following a report published by Wolfpack Research on June 25, 2025, titled "CTO The B. Riley of REITs." The report criticized CTO, drawing parallels with B. Riley, which recently faced a steep decline in its market value due to fiscal mismanagement and investigations into its financial reporting. Wolfpack’s analysis asserted that CTO had not generated sufficient cash to support ongoing operational costs and dividends, leading to an increased share dilution as the company sought to cover dividends.

Financial Impact and Stock Price Response

Following the release of the Wolfpack Report, CTO’s stock experienced a notable decline, dropping $0.98 per share (5.42%), closing at $17.10. The document highlighted that CTO had only $8.4 million in cash, while its quarterly obligations for dividends and capital expenditures surpassed its available liquidity. Such revelations have led to anxiety among investors concerning the company’s financial stability and future ability to sustain dividends.

About Pomerantz Law Firm

Pomerantz LLP has established a strong reputation for its role in championing the rights of investors, particularly in cases of securities fraud and corporate misconduct. With over 85 years of experience, the firm has effectively recovered billions for class members harmed by fraudulent activities. Their commitment to investor advocacy is reflected in their continuing efforts to hold corporations accountable for unlawful practices.

For potential investors or concerned stakeholders looking to learn more or participate in this class action, additional information can be obtained through the firm's contact resources. This case illustrates the inherent risks within the securities market and emphasizes the importance of transparency and compliance among publicly traded companies.