Starwood real estate fund halts redemptions as bet on lower interest rates bites

starwood's $10 billion real estate fund stopped letting investors pull money out entirely on thursday. the fund had already restricted redemptions two years ago, but now it's halting them completely. the fund had been betting that interest rates would fall, which would have boosted property values and made it easier to sell assets. instead, rates stayed higher for longer. starwood's flagship fund, one of the biggest private real estate funds in the world, now can't meet redemption requests without selling properties at a loss. the halt affects investors who had already submitted requests to withdraw. starwood said it needs time to sell assets in an orderly way. the fund's value has also been marked down repeatedly over the past year as higher rates squeezed commercial real estate.