#United States #San Francisco #Hagens Berman #CTO Realty #Wolfpack Research

Significant Share Price Decline for CTO Realty Growth, Inc.

On June 25, 2025, CTO Realty Growth, Inc. (NYSE: CTO) faced a sharp downturn in its stock prices following a report released by Wolfpack Research. This report has raised serious questions about the company's financial practices and transparency to its investors. Hagens Berman, a well-known national shareholder rights firm, has initiated an investigation into the claims made by Wolfpack, which accuses CTO of misleading its investors regarding the sustainability of its dividends and engaging in questionable financial activities.

Wolfpack Research Fears for Investor Rights

Wolfpack Research's report paints a troubling picture of CTO Realty Growth. It alleged that the management team may have misled investors about the robustness of their dividend payouts while prioritizing their financial gain over shareholder interests. Specifically, the report highlights allegations that CTO engaged in unusual accounting maneuvers, such as utilizing a 'sham loan' to mask financial weaknesses related to a major tenant's inability to meet obligations.

The management's boastful claims of managing ‘high-quality retail and mixed-use properties’ have come under scrutiny. Wolfpack highlighted a troubling subset of CTO's properties which are reportedly in dire financial crisis. The firm has suggested that CTO might be focusing on acquiring substandard, aging shopping centers that do not generate sufficient cash flow to meet capital expenditure, thus indicating a discrepancy between what CTO was promoting and the reality of its asset portfolio.

According to Wolfpack, the company’s purported capacity to sustain its dividend payouts hinges largely on a manipulated definition of Adjusted Funds From Operation (AFFO). This may have been strategically designed to exclude recurring capital expenditures, a tactic not employed by their industry peers. Consequently, management was accused of inflating performance-based bonuses to the tune of $8 million based on this misleading metric.

Hagens Berman's Investigation

Hagens Berman is now urging any CTO shareholders who have suffered significant financial losses to report their claims. The firm is particularly interested in gathering evidence that could substantiate the allegations made in Wolfpack’s report. Reed Kathrein, a partner at Hagens Berman, is leading the investigation and stated, “We’re investigating whether CTO may have misled investors about the quality of its real estate portfolio, the reported asset values, and/or the propriety of its use of AFFO.”

Hagens Berman also encourages whistleblowers with non-public knowledge about CTO's operations to come forward. The firm is connected with the SEC Whistleblower program, which allows those who provide original information regarding securities law violations to potentially receive up to a 30% recovery reward from any successful SEC enforcement action.

Company Background

CTO Realty Growth, Inc. describes itself as a self-managed equity real estate investment trust (REIT) focusing on the ownership, management, and repositioning of high-quality retail and mixed-use properties across the United States. Investors have become increasingly skeptical amidst the looming cloud of allegations and the recent stock value decline, fueling further speculation about the company's legitimacy.

As the investigation unfolds, both CTO's management and investors await clarity on the reported financial practices. The outcome of the investigation may have significant ramifications not only for CTO's share price but also for the broader real estate investment community.

Should you want to know more or get involved, Hagens Berman provides further information about the investigation and how to submit losses on their website: www.hbsslaw.com/investor-fraud/cto. Reports of unethical behaviors in companies like CTO may serve as a reminder of the importance of transparency and integrity within corporate structures.