Colliers-Branded TIC Deals Spark State, Federal Probes

A sprawling web of tenant-in-common deals tied to a Utah sponsor is under state and federal scrutiny as regulators probe allegations that retirees were sold high-risk real estate investments under the veneer of a global brokerage brand.

Millcreek Commercial Properties, led by Kevin Long, marketed fractional stakes in medical office buildings as stable, passive-income plays. But according to Bisnow, those investments unraveled as tenants failed, leases proved illusory and property values collapsed, wiping out investors.

The fallout has triggered at least 14 lawsuits across five states since 2023, alongside parallel investigations. The Securities and Exchange Commission has contacted investors, signaling an early-stage federal probe, while Utah’s Division of Real Estate has accused Long of multiple rule violations, including withholding material information about failing tenants while continuing to sell interests.

A core allegation is that Millcreek used marketing materials bearing Colliers’ branding to build trust, pitching properties as leased to fast-growing healthcare tenants at above-market rents. In reality, several of those tenants — including Healthcare Solutions Holdings, Neuragenex and Pulse Healthcare — later filed for bankruptcy, often without ever occupying space or paying rent.

Investors claim they were sold inflated valuations tied to those shaky leases. In one case, a Georgia property flipped from $1.1 million to $5.5 million in under a year before ultimately selling for $1.4 million. Others say distributions dried up within months, despite assurances of “hassle-free” income.

Colliers, which has moved to dismiss several lawsuits, says it had no contract with Millcreek. It’s unclear whether the brokerage authorized the use of its branding, a central issue in the litigation.

An unsigned memorandum of understanding submitted in court filings suggested a closer relationship, including commissions on TIC sales and the use of Colliers’ name in marketing.

Behind the scenes, emails cited in lawsuits show Millcreek scrambling as deals faltered. In one exchange, Long acknowledged cash flow problems, writing that the firm lacked funds to pay an investor.

The human toll is steep. Investors — many using 1031 exchanges tied to retirement savings — report losses in the hundreds of thousands or more. Some cannot afford to join lawsuits due to legal costs.

The cases underscore familiar risks in TIC structures, which require unanimous ownership decisions and offer limited liquidity. But attorneys allege this operation went further, misrepresenting leases, subsidizing tenants without disclosure and bypassing investor oversight.

Most cases remain in early stages with discovery underway.

— Holden Walter-Warner