The uncertainty and volatility in the commercial mortgage-backed securities market by COVID-19 lockdowns are causing extreme havoc for investment firms like Credit Suisse. The firm just announced that its global SIX Swiss Exchange fund had been suspended immediately, and the units have been delisted.
According to the bank, “The Credit Suisse Real Estate Fund Global (CS REF Global, valor no. 13985167) investment fund invested in quality commercial properties situated in attractive locations in the Americas, Asia-Pacific, and in Europe (excluding Switzerland). The fund management company initiated the liquidation of the Credit Suisse Real Estate Fund Global on November 30, 2020.”
The global property fund was shut down after low trading volume and a discount of more than 20% to underlying assets due to market corrections triggered by the COVID-19 pandemic, the bank said.
Credit Suisse had said that the fund’s performance is no longer consistent with the fundamentally high location and asset quality of the underlying real estate portfolio”, which consisted of 12 top-end commercial properties in America, Asia-Pacific, and Europe.
“The fund management company has decided to liquidate the Credit Suisse Real Estate Fund Global, partly because of the trading discount that has arisen on the stock market,” according to the bank.
The commercial properties held in the investment fund will revert to the Credit Suisse Real Estate Fund International in the first half of 2021, and the proceeds will be paid to investors.
The Credit Suisse Real Estate Fund International will acquire the properties, whose transfer value will be set by valuation experts and confirmed independently, it said.