The first quarter of 2023 was not kind to Brookfield Asset Management's real estate holdings. With $103 billion of fee-bearing capital at the opening, the last day of March closed at $98.1 billion. Of the roughly $4.9 billion drop was $1.8 billion loss through market valuation.

You can never be too big to be hurt, and Brookfield is one of the largest real estate owners. But no company is bigger than the overall market. Company president Connor Teskey said in an earnings call on May 5 that "one thing that we are seeing across almost every region in every asset class is an absolute bifurcation of the real estate market." Class A and high-quality properties "are performing fundamentally better than they ever have been before." But legacy properties without new amenities or ways of addressing ESG "are really struggling."

"Unfortunately, the negative sentiment is dragging down the real estate sector more broadly," Teskey said. Unfair, he called it, but it is a fact.