One of the largest global investment banks is winding down its legacy $2B real estate fund rather than attempting to meet investor redemption requests.

UBS announced Thursday that it would sell off all assets related to its Credit Suisse Real Estate Fund International, which it inherited after purchasing longtime rival Credit Suisse when it collapsed in 2023, Reuters reported. There was an immediate spike in investors seeking to withdraw their dollars, and 36% of its total fund units in circulation in 2022 were redeemed a year later.

UBS said to meet further 2023 outstanding redemptions, it would have to sell off the portfolio’s most liquid assets, hurting investors who remained in the fund and driving further requests to pull money out.

“The process to sell assets over the past 18 months to meet … redemptions has demonstrated the limited depth of the real estate markets,” UBS Fund Management said in a statement, according to Reuters.

UBS’ legacy fund was 80% office properties, the sector most under strain by plummeting commercial real estate values prompted by the sudden rise in Federal interest rates and a paradigm shift to hybrid work schedules.

Its market value dropped by 12% in the first six months of this year, on top of the 31% loss in value in 2023 compared to the prior year, Bloomberg reported.

As of June 30, 22% of the fund’s portfolio was in the U.S., 16% in Germany and another 14% in Canada, according to Reuters.

UBS' market cap is $96B.

Major private equity funds have been battling a wave of redemption requests over the past two years as investor doubts about the health of the commercial real estate sector mount. Starwood, KKR and Blackstone are among the major players to have limited redemptions periodically since 2022.