Sign in Subscribe
Securities law

Securities Class Action Filed Against CTO Realty Growth

Strategic Insights

— 2 min read

Faruqi & Faruqi, a leading national securities law firm, is investigating potential claims against CTO Realty Growth, Inc. ("CTO" or the "Company") (NYSE: CTO) after a federal securities class action was filed against the Company. The complaint alleges that CTO and its executives violated federal securities laws by making false and/or misleading statements and/or failing to disclose that the Company's dividends were less sustainable than Defendants had led investors to believe. The firm, led by partner Josh Wilson, encourages investors who suffered losses exceeding $75,000 in CTO between February 18, 2021, and June 24, 2025, to contact him directly to discuss their options.

Key Takeaways:

  • The complaint alleges that CTO's dividends were less sustainable than Defendants had led investors to believe, and the Company used deceptive and unsustainable practices to artificially inflate its AFFO and overstate the true profitability of its Ashford Lane property.
  • CTO's business and/or financial prospects were overstated due to these deceptive practices, making the company's public statements materially false and misleading.
  • On June 25, 2025, Wolfpack Research published a report comparing CTO unfavorably to B. Riley, a financial services company that lost more than 90% of its value amid three years of losses, soured investments, delayed financial reports, and an SEC investigation.
  • CTO allegedly relied on dilution (increasing shares outstanding by 70% since December 2022) to cover a $38 million dividend shortfall from 2021 to 2024, employed a manipulative definition of AFFO, and used a sham loan to hide the collapse of a top tenant from shareholders at Ashford Lane.
  • CTO has just $8.4 million in cash while facing quarterly dividends of $14 million.

Statistics:

  • The complaint alleges CTO's dividends were less sustainable than Defendants had led investors to believe.
  • The company allegedly used deceptive and unsustainable practices to artificially inflate its AFFO and overstate the true profitability of its Ashford Lane property.
  • CTO's stock price fell $0.98 per share, or 5.42%, to close at $17.10 per share on June 25, 2025.
  • The court-appointed lead plaintiff is the investor with the largest financial interest in the relief sought by the class who is adequate and typical of class members.

Sources:

  • [Faruqi & Faruqi, LLP Securities Litigation Partner James (Josh) Wilson] (https://www.faruqilaw.com/sec-litigation-practice/our-attorneys/josh-wilson/)
  • [Newsfile Corp. - September 14, 2025] (https://www.newsfilecorp.com/release/266236)
  • [Wolfpack Research] (https://wolfpackresearch.com/)
  • [CTO Realty Growth, Inc. (NYSE: CTO)] (https://www.ctorealtygrowth.com/)
  • [Faruqi & Faruqi, LLP] (https://www.faruqilaw.com/)

Read more