AEW Adjusts Deployment Plan For $1.8B Real Estate Fund

AEW Capital Management is refining its strategy for deploying its $1.8 billion North American real estate fund. The company recently closed its largest fund in July 2025, capitalizing on market conditions despite rising interest rates. Tony Crooks, managing director and senior portfolio manager, noted that debt availability is slowing fund deployment, yet select assets are performing well.

AEW has been focusing on distressed senior housing, having acquired 16 properties in 16 months, which have performed well due to tightened markets and limited supply. However, the multifamily sector is oversupplied, with prices dropping 15% to 30% in the past five years, making equity distressed or wiped out. In contrast, AEW sees opportunities in distressed industrial sectors and retail assets, particularly grocery-anchored and lifestyle centers, where they have observed rent growth.

The fund, which missed its $2 billion goal, is about 55% deployed, and AEW plans to launch a new fund in about a year, considering the current liquidity and debt conditions in the market.