Ares Industrial Real Estate Income Trust (AIREIT) Update – November 2025
Have You Suffered Losses Investing in Ares Industrial Real Estate Income Trust?
Ares Industrial Real Estate Income Trust (AIREIT), a perpetual-life, non-traded REIT sponsored by Ares Management Corporation, has grown into one of the largest industrial-focused private REITs available to retail investors. However, new financial disclosures highlight concerns that may be important for investors—particularly regarding performance, distributions, and the risks associated with non-traded REIT structures.
Financial Update: What AIREIT’s 2025 Results Mean for Investors
AIREIT’s latest filings show larger losses, higher costs, and continued reliance on new capital to fund distributions, even as the portfolio grows.
Ares Industrial Real Estate Income Trust recently reported a larger net loss for the first nine months of 2025—$118.5 million compared to $92.2 million last year—primarily because it did not record any property sales this year, while 2024 included significant gains from building dispositions. The REIT also faced higher interest expenses and lower financing gains, contributing to the decline. While Funds From Operations (FFO) decreased, reflecting weaker operating performance, Adjusted FFO improved due to growth in rental income and debt-related revenue from the expanding portfolio.
Despite the increased losses, AIREIT continued to grow, with total revenues rising to $437.2 million, an increase of $49 million year over year. NAV per share also climbed to $13.05, supported by new acquisitions, higher base rents, and stronger portfolio performance. However, nearly half of investor distributions (48.7%) were paid using new capital rather than operating cash flow, and the REIT continues to rely on substantial leverage and ongoing fundraising to support operations—factors that may raise concerns for some investors.
About Ares Industrial Real Estate Income Trust
Launched in 2017, AIREIT is a perpetual-life, non-traded REIT focused exclusively on U.S. industrial real estate. Ares Management, its sponsor, oversees more than $378 billion in global assets. The trust seeks long-term appreciation and income through logistics-driven industrial assets.
Unlike publicly traded REITs, shares are not listed, limiting liquidity. Redemptions are capped at:
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2% of NAV monthly
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5% quarterly
Shares held less than one year may be redeemed at only 95% of NAV. Redeemability is not guaranteed.
Performance and Distribution Trends
While some share classes—like Class I—have produced strong long-term returns (10.22% annualized), results vary and depend on fees, timing, and market conditions. Certain share classes experienced declines in 2023, including a 12.4% drop for Class T shares, illustrating potential volatility even within industrial-focused REITs.
Risks of Investing in AIREIT and Other Non-Traded REITs
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Illiquidity: Shares cannot be freely traded; repurchase limits may restrict exits.
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High Fees: Upfront selling commissions and ongoing distribution fees reduce investor returns.
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Valuation Concerns: NAV may not reflect true market value.
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Market Risk: Industrial real estate is sensitive to economic cycles and freight demand.
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Suitability Issues: These products are often sold to conservative or income-focused investors without full disclosure of risks.
Broker Liability and Investor Claims
Financial advisors recommending AIREIT must ensure the investment aligns with an investor’s:
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Risk tolerance
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Liquidity needs
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Investment objectives
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Overall financial profile
Failure to fully disclose risks such as high fees, illiquidity, or NAV declines may constitute broker negligence or misrepresentation—opening the door to claims for recovery.
Class Action vs. FINRA Arbitration
If you lost money in AIREIT, you may be evaluating legal options:
Class Actions
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Typically result in small, shared recoveries
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Do not hold individual brokers accountable
FINRA Arbitration
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Often faster than class actions
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Allows investors to pursue damages directly from the brokerage firm
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Historically more effective for recovering losses tied to unsuitable recommendations
How to File a Claim
If your financial advisor unsuitably recommended AIREIT or failed to disclose its risks, you may be eligible to file a FINRA arbitration claim.
For a free consultation, contact
The White Law Group at 1-888-637-5510
or visit www.WhiteSecuritiesLaw.com
FAQs
1. What does AIREIT invest in?
The trust focuses solely on U.S. industrial real estate, including bulk distribution and last-mile logistics properties.
2. Can I redeem my shares anytime?
No. Redemptions are limited and subject to availability. Monthly buybacks are capped at 2% of NAV, and quarterly at 5%.
3. Are non-traded REITs riskier than public REITs?
Generally yes, due to illiquidity, higher fees, less transparency, and potentially volatile NAVs.
