United Capital Real Estate is suing Subrata Roy, chairman of Sahara India Pariwar, as well as its U.S. entity, alleging that they breached an agreement by seeking a separate deal.
With its stock trading at a discount, it had been difficult for the REIT to get the quick access to capital needed for new development.
The Bethesda, Maryland-based real estate investment trust has interviewed advisers regarding the portfolio sale.
The project was too slow to cut rents and had trouble attracting students earlier this year because it was still under construction.
Investors are increasingly viewing MOB assets as more than just alternatives to core real estate sectors.
The losing suitor, Pebblebrook Hotel Trust, “was provided with material nonpublic information” during the sale process LaSalle said in a filing with the SEC.
Moderate-cost house construction is restrained by rising building costs.
The New York firm is buying 22 properties managed by Brookdale Senior Living Inc.