The Credit Suisse (SIX:CSGN) Real Estate Fund International, a $4.4 billion fund, is undergoing significant changes following a 9% drop in portfolio value in Q3, as the global property market faces a correction. The fund is offloading properties and diversifying its portfolio to navigate the challenging market conditions.
In response to investors withdrawing their funds, the Credit Suisse Real Estate Fund has decided to limit payouts. The fund's strategy includes a transition from retail to warehouse and home investments, while also reducing office properties. This strategic shift comes in light of rapid interest rate hikes that have been impacting commercial real estate values in the US and Europe.
These pressures were felt even before the merger of Credit Suisse with UBS Group AG (SIX:UBSG). The fund is set to abandon over-the-counter trading for a net asset value-based system by November 30th. This change is due to widespread dissatisfaction with the current trading method among both investors and management.
The move towards diversification and a new trading system marks a significant shift for the fund as it navigates a rapidly evolving real estate market.
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