The liquidation of German open-ended real estate funds (GOEREFs) is related to structural rather than fund-specific characteristics, according to Fitch Ratings.
The recently announced liquidation of Credit Suisse CS Euroreal confirms Fitch Ratings' view that GOEREFs are one of the last segments of the European fund industry with a large structural liquidity mismatch. Historically, they offered daily liquidity despite being invested in property assets, whose disposal to meet redemptions might take some time. "This fund structure has proved difficult to sustain in light of market conditions and investor redemption requests. Regulatory efforts have sought to address the liquidity mismatch in these funds, providing for annual redemption only. Un...
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