Investment: Investors are abandoning real estate funds

For decades, open-ended real estate funds were considered as solid as concrete. Now, savers are withdrawing billions – and court rulings are putting the industry under additional pressure.

To stay with the metaphor, one could say about open-ended real estate funds: The door is open, but fewer and fewer investors want to get into this multi-billion dollar asset class, and more and more are wanting to get out. Capital has been flowing out of the funds for months, and the payouts to investors who are canceling their investments far exceed the newly invested amount – thus becoming an increasing problem: for banks and fund companies, for the real estate market, and possibly also for investors.