Key Takeaways
- • DWS has temporarily restricted redemptions from its open-ended real estate fund Grundbesitz Europa, effective October 27, 2026, to allow time for property sales and to strengthen the fund's liquidity position.
- • Under the restriction, redemption requests due for payment from October 28 will initially be paid at 10%, with the remaining 90% lapsing and not paid automatically at a later date.
- • Redemption orders due on October 27, the first day of the restriction, will be fulfilled in full, according to DWS.
- • The restriction can remain in place for a maximum of 12 months from October 27, 2026, under the applicable legal limit, and can be lifted early if conditions allow.
- • DWS, the asset management subsidiary of Deutsche Bank, says it will keep selling properties, repay loans and potentially raise the payout rate, reviewing it regularly.
Summary
German asset manager DWS has temporarily restricted redemptions from Grundbesitz Europa, its open-ended real estate fund, according to a Reuters report. The restriction took effect on October 27, 2026, following the company's announcement earlier that week. DWS said the measure is intended to allow time for property sales and to strengthen the fund's liquidity position.
Under the terms of the restriction, redemption requests due for payment from October 28 will initially be paid at a rate of 10%. The remaining 90% of each affected request will lapse and will not be paid automatically at a later date. Redemption orders due on October 27 will be fulfilled in full.
DWS said it will continue selling properties to improve the fund's liquidity, repay loans and potentially increase the payout rate. The company will review the rate regularly and may adjust it based on the fund's liquidity position and financial planning. The restriction may be lifted before the end of the permitted period if conditions allow, and under the applicable legal limit it can remain in place for no more than 12 months from October 27, 2026.
The move comes amid pressure on three DWS open-ended property funds since the European Central Bank began raising interest rates in 2022. The restriction applies to Grundbesitz Europa only, while property sales continue across the group's efforts to shore up liquidity. DWS is the asset management subsidiary of Deutsche Bank.
The episode underscores the liquidity challenges facing open-ended property funds, whose underlying assets can take time to sell. For investors, the immediate implication is that redemption requests may not produce the full expected payout, which may lead them to reconsider withdrawal plans. Investors will need to follow DWS's official announcements for updates on redemption conditions and any change to the payout rate.
Under the terms of the restriction, redemption requests due for payment from October 28 will initially be paid at a rate of 10%. The remaining 90% of each affected request will lapse and will not be paid automatically at a later date. Redemption orders due on October 27 will be fulfilled in full.
DWS said it will continue selling properties to improve the fund's liquidity, repay loans and potentially increase the payout rate. The company will review the rate regularly and may adjust it based on the fund's liquidity position and financial planning. The restriction may be lifted before the end of the permitted period if conditions allow, and under the applicable legal limit it can remain in place for no more than 12 months from October 27, 2026.
The move comes amid pressure on three DWS open-ended property funds since the European Central Bank began raising interest rates in 2022. The restriction applies to Grundbesitz Europa only, while property sales continue across the group's efforts to shore up liquidity. DWS is the asset management subsidiary of Deutsche Bank.
The episode underscores the liquidity challenges facing open-ended property funds, whose underlying assets can take time to sell. For investors, the immediate implication is that redemption requests may not produce the full expected payout, which may lead them to reconsider withdrawal plans. Investors will need to follow DWS's official announcements for updates on redemption conditions and any change to the payout rate.
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