Difficult market conditions are adding pressure to Credit Suisse's real estate funds.
Credit Suisse Real Estate Fund International is a Swiss investment fund with more than 50 properties in approximately a dozen countries. After losing significant value last year, the fund is now facing redemption demands, the bank said in an emailed financial update Friday.
In 2022 the fund’s net asset value (NAV) was reduced by 10 percent from the previous year to between 960 and 970 Swiss francs, while its distribution came down from 40 francs to between 35 and 38 francs per unit, the bank said, attributing the decline to last year’s unfavorable market conditions.
More alarmingly, however, is that last year’s investor redemption requests amounted to 13.3 percent of the issued units.
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The withdrawals are partly explained by real estate valuations being impacted by central banks tightening their monetary policy and raising interest rates; a development, which has also affected other real estate investors.
It could also indicate that ongoing negative press coverage directed at some of the bank's other business areas, is deterring clients from Credit Suisse's fund products.
