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Rating:DeAM Hangs on a RREEF Not Rated 0.0 Email Routing List Email & Route  Print Print
Wednesday, August 08, 2012

DeAM Hangs on a RREEF

News summary by MFWire's editors

With Guggenheim out of the picture, asset sales at Deutche Bank [profile] which at one time included all its U.S. asset management business have mostly slipped off the business pages. But the German bank is still weighing its strategic options with a September deadline. That deadline, and the fate of its real-estate asset management unit RREEF caught the attention of the Wall Street Journal.

The paper reports that Deutsche Bank's top brass can't seem to make up their minds on whether to sell RREEF or not. It adds that the absence of clear direction for the real estate fund group is putting RREEF at a competitive disadvantage. RREEF claims $56 billion of DeAM's $694 billion of AUM.

A bank spokesperson refused to discuss the status of the fund with the paper but said that they are creating a "newly-integrated asset and wealth management division." She added that they are committed to growing the unit.

Deutsche's management will announce their final decision come September, but the WSJ notes that many investors are not willing to wait that long. Pension plan sponsors and consultants say they are hesitant to put their money in RREEF because of the uncertainty, and pension funds have been looking for safer property funds for their money.

Indeed, talk of the sale caused The Massachusetts Pension Reserves Investment Management Board to yank a $275 million mandate from RREEF this year. Deutsche Bank documents show that a total of $150 million redemption requests were made of RREEF's flagship fund.

Meanwhile, the paper reported that the bank will no longer pursue the plan for a new $1.24 billion property fund. It also reports that the fund group has cut 8 percent of its investment staff, leaving it with about 550 professionals. 

Edited by: HFD

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