- Two Sigma has stopped fundraising and new investing at its real estate unit and cut senior staff, including CIO Rich Gomel, two years after opening to outside capital.
- The unit sought about $2B for its Real Estate Opportunity Fund but raised less than half, and remaining staff will manage the existing portfolio of properties.
- Private real estate fundraising totaled just over $30B in the quarter through September, the lowest since early 2013, per PEI Group, showing how hard raising capital has become.
Two Sigma has halted real estate fundraising and trimmed senior staff in its property unit, according to Bloomberg, which cited unnamed sources.
The quantitative hedge fund also stopped making new investments through the business, two years after it began accepting outside capital.
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Who Is Leaving
Gomel, partner and chief investment officer of the unit, is exiting with other real estate leaders, people familiar told Bloomberg. Also exiting are two of three remaining partners and a data science chief, one of a pair.
Two Sigma, which oversees roughly $85 billion, declined comment, per Bloomberg. Some staffers will stay to manage the properties the unit already owns.
A Fundraising Shortfall
The firm targeted about $2B for the business but drew less than half of that, some of the people told Bloomberg, speaking on condition of anonymity because the details are confidential.
Its Real Estate Opportunity Fund, opened to outside money in 2024, centered on housing and industrial assets, with more selective bets in hospitality and offices. Other planned vehicles never came together, Bloomberg reported.
The Teacher Retirement System of Texas was among the backers, putting roughly $75 million into the main fund in 2025 and another $60 million through a co-investment vehicle, per Bloomberg’s sources.
A Data-Driven Pitch
Two Sigma started building the unit in 2019 and seeded it with the firm’s own money roughly two years after that, Bloomberg reported. Tom Hill, a former Blackstone vice chairman who consulted first and became a full-time employee in 2021, served as CEO until he left in 2025, one person told Bloomberg.
The strategy relied on the firm’s data and predictive tools to forecast supply and demand. In a 2021 interview cited by Bloomberg, Hill argued that property is data-rich yet few investors use that data to decide what and where to buy.
Why It Matters
Higher interest rates have pressured valuations and led firms to hold assets longer, Bloomberg reported, making capital hard to raise across the industry. PEI Group data cited by Bloomberg put private real estate fundraising at a little over $30B over the quarter that ended in September.
We have seen the same squeeze in closed-end fundraising, which reached $81.7B in the first half of 2026, per With Intelligence. First-time vehicles drew only 17% of that capital while established managers took 59%, which leaves newer entrants at a disadvantage.
What’s Next
Watch how the remaining team handles the existing portfolio and whether other newer managers follow with pullbacks. Large allocators are still writing checks to established sponsors: we covered the Texas pension system’s $150M commitment to Pennybacker VII.
