Bers Engaged in Institutional Real Estate Investment Through The

Pension Real Estate Association

Mission To serve its members engaged in institutional real estate investment through the sponsorship of objective forums for education, re- 20 search initiatives, membership interaction and the 08 exchange of information.

2008 Annual Report 2008 Headlines

Mortgage Crisis Spreads Past Subprime Loans–New York Times, February 12

Obama Wins Presidency, Making History—Los Angeles Times, November 5

Dow Sinks Below 10,000 Threshold Amid Fearful Trade—Financial Times, October 7

Home Prices Slide Further—Miami Herald, August 26

The $700 Billion Bailout Battle Begins—Chicago Tribune, September 23

Hitting Bottom?—Barron’s, March 24

For Bank Stocks, Two Steps Down, One Step Back—Wall Street Journal, September 30 Annual 20 Report 08

Table of Contents

Letter from the President 4

Strategic Priorities 6

Products & Services 13

Scholarships 27

PREA Governance 28

PREA Staff and Vision 32 Pension Real Estate Association

Dear PREA Members:

I imagine that those of us in the institutional investment world could all agree that 2008 is the kind of year we would rather not experience again. Though the economic crisis described below did not originate in commercial real estate, institutional property investors have nonetheless felt its effect, and perhaps never so forcefully as during the past year.

After a half decade-long period of outsized returns in real estate and the broader financial world, the problems that began to emerge in 2007 were cause for concern, but at first seemed to be contained within a minuscule portion of the debt space. Real estate fundamentals remained strong, and the global economy appeared otherwise healthy. As investors have since learned, the true scale of the crisis had yet to reveal itself. Troubles that once appeared endemic to the subprime category were later found to be present within a wider class of securitized debt. Years of declining underwriting stan- 4 dards, rising loan to value ratios and other markers of easy lending had led to an unsustainable market position. As the unwinding built momentum, talk of an isolated economic disruption gave way to ever greater fears of a far-reaching recession. Many such fears were validated in 2008. A shrinking gross domestic product, falling retail sales, bankruptcies and forced sales among leading investment banks and dozens of other firms, conservatorship of government-sponsored enterprises, and stunning drops in public equities prices were all in evidence at one point or another during the year, if not throughout its course.

At PREA, realizing that investors’ demand for education and communication only grows during times of dislocation, we worked to ensure that our products and services, including conference sessions, published articles and disseminated research, were timely and relevant. Investing in a credit-constrained environment, the effect of the crisis on the residential and debt capital markets, and opportunities in the securitized debt world were among the many pertinent topics covered. Furthermore, we continued to build upon our smaller-scale programs, including the topic-specific affinity groups held in conjunction with the Spring and Annual conferences. We also improved upon the regional plan sponsor luncheon program and the plan sponsor-only conference session, both of which provide additional time for investors to discuss issues of shared interest.

Respected Resource for Education and Information Exchange, Vision, Experience, Interactive Forums, Destination for Institutional Investor Education, Research, Leadership, Member-driven Organization, Respected Resource for Education and Information Exchange, Vision, Experience, Interactive Forums Pension Real Estate Association Annual 20 Report 08

If the numbers are any indication, our efforts to enhance the benefits of PREA membership led to a very successful year. Our retention rate was above 90%, continuing a five-year trend. Despite the troubled economic backdrop, membership in PREA increased, both generally and within the investor category. Above-average attendance levels were recorded for both major conferences. The quality of member participation was also quite impressive, whether on the Board of Directors, within the standing committees or through contributions to PREA meetings or publications. I would like to take this opportunity to thank all those who gave of their time, effort and talents during the year. The engage- ment of industry leaders through volunteer service is a critical factor in PREA’s success. I would also like to recognize the PREA staff, which translates board and committee directives into tangible products and services for members, and does so with conspicuous excellence.

Looking ahead, our goal is to augment our existing member benefits with new forums for education 5 and communication, and novel modes of content delivery. Among these are planned webinar broad- casts, through which members will be able to access the insights and opinions of industry leaders online, an expansion of regional luncheons to include all member constituencies, and a young leaders program designed to encourage rising talent within the investor community to become involved in the organization. Maintaining and expanding upon PREA’s role as the premier source of education, research and communication for real estate investors will help sustain us through this interval of market troubles and into the recovery stage for which we are all busily preparing.

Gail Haynes President

Strategic Priorities – Highlights and Accomplishments in 2008 EducationI. Education Goal Enhance existing products and services and introduce new innovations to meet the changing needs of members and the industry at large.

Ongoing Priorities Building on existing capabilities, PREA will continue to improve communications with its members and targeted non-members. This will occur over a variety of mediums including events, publications, research outputs, the website and other tools. Better communication will promote the educational focus PREA maintains and will reinforce the view of our organization as a key informational source within the industry. Taking into account member input and feedback, we will focus on those areas that provide additional opportunities for dialogue between managers and investors. Additionally, there will be an increased emphasis on global content across all products and services. 6 2008 Efforts n Produced and hosted the two most-attended conferences in PREA’s history. These conferences featured speakers and participants who are the senior-most leaders from our industry and beyond. From the attendance and feedback received, it was evident that the conferences included the right voices discussing the most current and critical issues of the day. See details on the specific events later in this report. 1200

1000 878 786 800 781* 668 703 612 600 533 442 408 452 400 NOTE: The Fall 2005 conference was 200 a joint conference held with NCREIF

0 2004 2005 2006 2007 2008

Spring Conference Fall Conference Pension Real Estate Association Annual 20 Report 08 Education n Published the PREA Quarterly with an emphasis on quality content and publication standards; details of each issue are provided under the Products & Services section of this report. n Began a complete redesign of PREA’s website to be completed and launched in 2009 n Continued “green” initiatives for PREA’s internal operations and developed educational program- ming focused on green buildings and sustainability n Continued regular quarterly informational communications with membership via email n Issued periodic Legislative Alerts to bring attention to new laws and government regulations im- pacting real estate investments n Distributed monthly Real Estate Information Standards (REIS) updates to inform membership of progress and ask for commentary when appropriate n Initiated an ad-hoc New Programs Committee whose focus is on developing and executing new educational opportunities for PREA members. The first such undertaking will be the new webinar series that will be launched in early 2009. Another area of focus is the initiation of regional meetings to introduce non-member investors to PREA. 7 Pension Real Estate Association

Strategic Priorities – Highlights and Accomplishments in 2008 continued ResearchII. Research Goal

Pension Real Estate Association Provide members with timely, relevant and reliable information by becoming a key, authoritative source for industry and academic research.

PREA RESEARCH REVIEW Ongoing Priorities 2 0 0 8 The research department was formally established in 2001. Research initiatives to this point have been focused on gathering industry information, resulting in the distribution of several surveys to both members and non-members. These surveys provided the raw data for a number of reports on plan 2008pension real estate association sponsor capital flows and activity. PREA will continue to work to enhance and expand upon existing research products as well as initiate new outputs deemed necessary and valuable by the research committee and members. Additionally, PREA will undertake original research projects as a means to educate our members and to further PREA’s voice in the market. We will continue to collaborate with other organizations on industry-wide research projects and initiatives such as the independent Real 8 Estate Information Standards (REIS) Board.

2008 Efforts n PREA’s Director of Research was a frequent speaker at industry conferences both in the US and abroad and had articles published in numerous industry publications including a regular column in the PREA Quarterly. n Sponsored a special issue of the Journal of Real Estate Portfolio Management, a publication of the American Real Estate Society (ARES) n Expanded collaborations with like industry groups, both domestically and internationally, and continued to identify areas of cooperation with universities and other academic institutions n PREA enhanced its support of undergraduate real estate education through involvement in the USC International Real Estate Case Competition. n Continued role as a founding sponsor and administrator of the Real Estate Research Institute (RERI), an industry group that encourages academic research n Maintained collaboration with NCREIF in support of the independent Real Estate Information Stan- dards (REIS) Board Pension Real Estate Association Annual 20 Report 08

Research III.Member Member Experience Experience Goal As the PREA membership continues to grow, ensure that members feel personally vested in the organization through smaller-scale forums and member interaction.

Ongoing Priorities PREA will attract new members in a way that provides balanced growth. It is clear that it is important to existing members that PREA maintain the dynamic of small groups and personal interaction that they expect while expanding our membership and global reach. A balanced growth approach will carefully incorporate new members into the organization without jeopardizing the familiarity many members value from PREA.

2008 Efforts n Welcomed a new Membership Director, Sandra McDermott, who is solely dedicated to membership issues 9 n Invited all new members to attend the Membership Committee meeting at the Annual Plan Spon- sor Real Estate Conference n Continued to evaluate ways in which to engage non-members, such as participation in regional lunches or workshops; non-member breakfasts were introduced in specific regions n Expanded and rotated committee membership n Added more networking time with the PREA Café and scheduled free time for attendees within the conference program n Refined PREA’s affinity groups, which are modeled after the ULI council concept. These are designed to encourage candid and open dialogue among members around a specific topic. Member- ship in each group is limited in order to maintain a small group dynamic. Meetings are held in conjunction with our spring and fall conferences. Affinity group topics are enumerated below. n Green Buildings/Sustainable Investing n International Investment n Development Trends n Capital Flows n Alternative Investments n Reporting & Valuation Plan Sponsor Member Experience n The Plan Sponsor Council continued to focus on the specific and unique needs of PREA’s plan sponsor members. n In response to plan sponsor member suggestions, the Plan Sponsor Only half day sessions at the Annual Fall Conference were continued. n Designed an investor only section of the website for launch in conjunction with PREA’s new site n Continued to develop and expand the Regional Luncheon program for plan sponsors n Developed the Plan Sponsor Research Report and instituted the use of an online survey tool for responses n At the request of the Plan Sponsor Council, PREA partnered with FPL Associates L.P. to conduct the second annual Plan Sponsor Compensation Survey. Pension Real Estate Association

Strategic Priorities – Highlights and Accomplishments in 2008 continued MembershipIV. Membership Goal Continue to meet the needs of our existing membership while taking steps to reflect the imperatives of the broader industry.

Ongoing Priorities PREA must continue to meet the needs of its existing membership while taking steps to reflect the industry which it serves. This includes welcoming different types of investors, managers and other organizations both domestically and globally. Through this type of expansion and evolution, PREA can ensure its endurance as a leading industry association. The second part of this strategic priority is to ensure PREA is meeting the demands of our existing members in the most effective, efficient manner possible. Growth is an important element of PREA’s continued success but maintaining existing members’ satisfaction is why we are here. It is also the rea- son new members will join. Without its members’ support, PREA will not continue to thrive. 10 2008 Efforts n Grew PREA’s overall membership by over 10% and investor membership by 14%

700 632 572 600 532 500 454 472 400 300 PREA’s Total Membership –5-Year Period 200 147 107 112 122 129 100 0 2004 2005 2006 2007 2008

Total Members Plan Sponsor Members Pension Real Estate Association Annual 20 Report 08

n Retained approximately 93% of existing members and 100% of our plan sponsor members. Our retention rate is strong at a percentage equal to or greater than 90% of total membership in any given year. This percentage takes into account the mergers and acquisitions of member firms and net membership figures. 700 101 600 63 91 500 60 36 400 300 531 PREA’s Total Membership Retention – 5-Year Period 509 436 441 200 394 100 0 2004 2005 2006 2007 2008 11 Retained Members New Members

n With the growth in the membership number, the composition of member categories remains the same as in the previous year. We continue to track this to ensure that our membership reflects the industry at large.

Others Investment 30% Managers PREA’s Membership Composition–2008 47%

Plan Sponsors 23%

n Continued to focus on engaging senior level executives and industry leaders to be involved in PREA, in leadership roles and as participants in committees, events and publications. The high level of interest and willingness of our membership to participate in PREA has allowed us to sustain the high quality of services PREA delivers. We greatly appreciate the knowledge and talent that our volunteer members contribute to the overall success of the organization. Pension Real Estate Association

Strategic Priorities – Highlights and Accomplishments in 2008 continued GlobalV. Global Presence Presence Goal To collaborate on educational and research opportunities with global, like organizations to further PREA’s global awareness and presence.

Ongoing Priorities The institutional real estate investment community is global. If we are the association that reflects the industry, PREA must expand its global reach to reflect the growing interest in opportunities outside the United States among its members and within the industry.

2008 Efforts n Welcomed 19 new international member organizations to PREA, bringing the total to 46; of this, 14 are plan sponsors. n Expanded relationships and collaborated with similar foreign groups, i.e., European Association for 12 Investors in Non-Listed Real Estate Vehicles (INREV), Investment Property Databank (IPD), Investment Property Forum (IPF), and Asian Real Estate Association (AREA) n For the fifth consecutive year, PREA placed the keynote speaker at the annual conference of the Association for Real Estate Securitization (ARES), a Japanese real estate trade association. A contingent of ARES representatives attended PREA’s Annual Conference to gain a better understanding of our organization. To expand this relationship, plans are underway for a co-sponsored event between ARES and PREA to be held in Japan in 2009. n PREA’s Director of Research participated on a panel of experts to discuss the US markets for MIPIM’s annual conference and was a keynote speaker at IP&E’s annual investor awards ceremony. Pension Real Estate Association Annual 20 Report 08

Products and Services

EventsEvents PREA’s meetings and conferences provide numerous opportunities for investors to communi- cate with peers and to learn more about today’s most important investment trends and topics. An emphasis on the objective and unbiased exchange of information is maintained through the selection of highly-respected presenters and a “no-marketing” policy. The Spring Conference, initially held in 1984, and the Annual Plan Sponsor Real Estate Confer- ence, which debuted in 1990, are the two largest events hosted each year. The CEO Leadership Forum, initiated in 1999 and held the day prior to the major conferences, is an invitation-only meeting designed to facilitate high-level discussion of 13 investment strategy among leading managers, investors and consultants. The recently inaugu- rated affinity groups, which meet in conjunction with the Spring and Annual conferences, are geared toward more personalized interaction and dialogue surrounding issues of particular interest to attendees, such as green construction or the capital markets. The closed plan sponsor-only sessions afford extra time for investors to meet with their peers and consider issues of special importance to the plan sponsor community. The PREA Institute, a collaboration with real estate faculty at major research universities, offers a select group of participants a chance to explore the academic aspects of property investment and portfolio management. The Institute’s speakers, panelists and attendees are carefully chosen to promote a balance of theory and practice in the program and discussions. The regional plan sponsor breakfasts were recently launched to provide a setting for investors to meet locally and talk over matters that they have identified as mu- tually interesting or important. Pension Real Estate Association

Products and Services SpringSpring ConferenceConference What began as a subprime crisis had begun to spread to other parts of the investment universe by the time of the 2008 Spring Conference. A major goal for all present was to identify which areas were infected as well as the extent of the damage.

The conference opened with a keynote panel moderated by CNBC’s Rebecca Jarvis that included Nari- man Behravesh, Wesley Edens and Lawrence Summers. Panelists addressed the state of the investment markets and economy and the outlook for the future which, it was conceded, was far from certain. The next panel was focused more specifically on the residential crisis. Gadi Kaufmann moderated a group that assessed how the crisis developed, the present situation and the future outlook from the perspec- tives of the development community, the “trading desk” of an investment bank, and a government- sponsored enterprise research department. The moderator of the following panel, Doug Lyons, asked panelists about the same three points as Kaufmann, but with respect to the debt markets in particular. The points of view represented included those of traditional portfolio lender, investment manager, 14 opportunity fund, and ratings agency. Members of both the residential and debt markets panels generally agreed that declining cap rates and other positive indicators had gradually given way to market excesses. The subprime crisis, along with shorting activity by some hedge funds, had spelled the end of the bubble. They also concurred, though, that opportunities existed for investors with either their own capital to invest or access to lenders’ funds as a result of established relationships or favorable risk pro- files. After the luncheon, a panel of CEOs moderated by Peter Linneman presented their own thoughts on the origins and extent of the crisis and how investors could capitalize on the dislocation. The dinner featured a political roundtable during which moderator Jim Lehrer prompted political observers Mark Shields and Tucker Carlson to comment, often with comedic effect, on the prospects of the presiden- tial candidates and their parties. Bill Emmott of The Economist kicked off the second day of the conference with a well-received talk about the intense rivalry between China, India and Japan and its global political and economic implications. Emmott’s remarks were followed by a panel of top investors and managers, moderated by Linda Assante, that considered the potential risks and rewards of investing in emerging markets, which offer the possibility of outsized returns but which are often characterized by lower levels of transparen- cy and may require investors to face additional political and legal liabilities. The final conference session was a panel moderated by Philip Fitzgerald which picked up on the theme of emerging market investment. Global investors often look to develop or tap into on-the-ground expertise through partnerships in the emerging markets where they allocate capital. Session panelists, prominent operators in Brazil, India, Turkey, China, Russia and Central/Eastern Europe, contemplated the most important factors underlying investment in their home countries and, generally speaking, in emerging markets. Pension Real Estate Association Annual 20 Report 08

Spring Conference Speakers Co-Chairs: Linda Assante, Partner, Oak Hill Investment Management, L.P. Jay Mantz, Managing Director, Morgan Stanley Stephen Quazzo, Managing Director and CEO, Transwestern Investment Company

Speakers: Rebecca Jarvis, Reporter, CNBC Nariman Behravesh, Chief Economist and Executive Vice President, Global Insight Wesley Edens, Founding Principal, Chairman and Chief Executive Officer, Fortress Investment Group, LLC Gadi Kaufmann, Managing Director & CEO, Robert Charles Lesser & Co. Jeff Blau, President, Related Companies Stephen D’Antonio, Managing Director, Morgan Stanley 15 David Goldberg, Associate Director, UBS Investment Research Tony Green, Managing Partner, The Pinehills Frank Nothaft, Vice President and Chief Economist, Freddie Mac Doug Lyons, Managing Director, Transwestern Investment Company Tony Campbell, President & CEO, Anglo-Irish Bank David Maki, Head of Capital Markets, North America, RREEF Kenneth McIntyre, Managing Director and Head of Real Estate Capital Markets, MetLife Susan Merrick, Managing Director, Fitch Ratings Sheridan Schechner, Managing Director, Lehman Brothers, Inc. Edward Shugrue, General Partner and Founder, Guggenheim Structured Real Estate Peter Linneman, Principal, Linneman Associates and Albert Sussman Professor of Real Estate, Professor of Business and Public Policy, Wharton School, University of Pennsylvania Dean Adler, CEO & Co-Founder, Lubert-Adler Partners, L.P. Neil Bluhm, Principal, Walton Street Capital, LLC J. Bruce Flatt, Managing Partner, Brookfield Asset Management, Inc. Jonathan Gray, Senior Managing Director and Co-Head of the Real Estate Group, The Blackstone Group Jim Lehrer, The NewsHour with Jim Lehrer Tucker Carlson, host of MSNBC’s Tucker Mark Shields, nationally known columnist and commentator Bill Emmott, former Editor-in-Chief, The Economist Gary Garrabrant, CEO and Co Founder, Equity International Timothy Hoeppner, Managing Director - Real Estate, MacArthur Foundation Scott Kelley, Managing Director, Aetos Capital, LLC Michael Pralle, President and Chief Operating Officer, JE Robert Companies Philip Fitzgerald, Managing Director, Paladin Realty Partners, LLC Carlos Betancourt, CEO, Bracor Investimentos Imobiliarios Ltda. Levent Eyubogla, President, Multi Turkmall Anuj Gupta, Founder and CEO, South Asian Real Estate Jean-Francois Ott, President & CEO, ORCO Property Group Pension Real Estate Association

Products and Services continued Fall ConferenceFall Conference The Annual Plan Sponsor Real Estate Conference in Chicago revolved around the question, “is the sky really falling?” in terms of credit, liquidity and valuations. The economic situation had grown increasingly dire, as reflected in Lehman Brothers’s decision to file for bankruptcy protection in the days preceding the conference. There was little doubt that the subprime crisis had spread far and wide, and the likely proportions of the catastrophe seemed to shift daily.

Appropriately, the conference opened with a panel of leading economic thinkers, moderated by Geof- frey Colvin of Fortune Magazine, who analyzed macroeconomic events in terms of their effects on the major business sectors. During the second session, the focus narrowed to the US private real estate world with a panel moderated by John Kukral. Among the specific topics considered were space market fundamentals, valuations and transaction activity. The subject of green investing, a priority identified by PREA’s leadership in 2007 for continued research and analysis within PREA’s meetings and publications, was reprised during a luncheon presentation specific to the Chicago market. Following lunch, 16 a panel led by Theodore Bigman conversed about the public real estate market, within which prices had generally adjusted more quickly to the turmoil than in private real estate. The possibility of further public market declines, observers noted, nonetheless remained. Scheduled next were the meetings of affinity groups dedicated to green investment, the capital markets, international allocation, development trends and alternative investments. New York Times correspondent David Sanger spoke during the dinner reception about the implications of Bush administration actions for President Obama and future successors, a timely topic that Sanger explored in a recently published book, The Inheritance: The World America Now Faces. The second day of the conference began with a keynote address by Columbia University finance professor Frederic Mishkin, a former Federal Reserve board governor. Mishkin reviewed the elements, including financial innovation, an asset price bubble, and the ensuing deterioration of financial institutions’ balance sheets, leading up to the debt market collapse and economic crisis, and commented on the ways in which government should and should not intervene to bring about a market recovery. The debt market theme carried over into the subsequent panel, guided by Spencer Haber, which examined the prospective timing and forms of a CMBS market resurrection and the opportunities associated with a variety of possible market outcomes. During the concluding conference panel, a mix of investors and managers, led by Anthony Frammartino, discussed the factors shaping limited partners’ investment activities and strategies. An overriding theme of the discussion was how the market turmoil had led to adjustments in investors’ thinking and expectations for managers. In general, the information exchanged and tenor of panel sessions indicated that it was perhaps premature to affirm that the “sky was falling” in terms of real estate performance and the global economy, but that central question posed to conference attendees undoubtedly remained an open one. Pension Real Estate Association Annual 20 Report 08

Is the Sky Really Falling? 1 8 th Credit, Liquidity, Annual Valuations Plan Sponsor Co-Chairs Charles Carpenter Managing Director-Private Markets Group Conference State of Wisconsin Investment Board

Alan Forman October 1-3, 2008 Director of Investments Yale University Investments Office The Fairmont Chicago

Chicago, IL Susan Meaney Managing Director Fall Conference Speakers Makena Capital Co-Chairs: Charles Carpenter, Managing Director, Private Markets Group, State of Wisconsin Investment Board Alan Forman, Director of Investments, Yale University Investments Office Susan Meaney, Managing Director, Makena Capital

Speakers: Geoffrey Colvin, Senior Editor-at-Large, Fortune Magazine Daniel S. Och, CEO, Executive Managing Director and Founder, Och-Ziff Capital Management Group Allen Sinai, Founder, Chief Global Economist and President, Decision Economics Thomas F. Steyer, Sr. Managing Member and Co-Managing Partner, Farallon Capital Management, LLC 17 John Kukral, President, Northwood Investments Keith Barket, Senior Managing Director, Angelo, Gordon & Company Robbin Cohen, Executive Vice President, Pritzker Realty Group Jeff Jacobson,Global Chief Executive Officer, LaSalle Investment Management Roy Hilton March, Chief Executive Officer and Senior Partner, Eastdil Secured Doug Shorenstein, Chairman & CEO, Shorenstein Properties LLC Theodore Bigman, Managing Director, Global & U.S. Portfolio Mgr., Morgan Stanley James Hoffman,Senior Vice President, Partner and Global Industry Analyst, Wellington Management Jeffrey Horowitz,Managing Director and Head of Global Real Estate Banking, Merrill Lynch Mike Kirby, Director of Research, Green Street Advisors Ed Walter, CEO, Host Hotels and Resorts, Inc. David Sanger, Chief Washington Correspondent for The New York Times Dr. Frederic Mishkin, former member of the Governing Board of the United States Federal Reserve and the Alfred Lerner Professor of Banking and Financial Institutions at Columbia Business School Spencer Haber, Chairman & CEO, H/2 Capital Partners LLC Mark Finerman, Managing Partner, LoanCore Capital Daniel Heflin,President & CEO, ING Clarion Capital John Klopp, CEO, Capital Trust, Inc. David Twardock, President, Prudential Mortgage Capital Company Anthony Frammartino, Principal, The Townsend Group Eric Lang, Director, Real Estate Assets, Teacher Retirement System of Texas Neil Madsen, Senior Vice President, Head of Private Equity, Aegon USA Realty Advisors, Inc. Brian Schneider, Managing Director-Real Estate and Natural Resources, University of Pennsylvania Investment Office Robert Schau, Director of Real Estate Investments, UTIMCO Steven Wayne, Partner and CEO, Jensen Group Eddie Wong, CEO, Winnington Capital Pension Real Estate Association

Products and Services continued PREAPREA Institute Institute The 2008 PREA Institute was held at the Paul Milstein Center for Real Estate at Columbia University’s Graduate School of Business. A group of highly regarded presenters drawn for the academic and business communities led discussions about a variety of property market and related topics, prompting active participation from the audience.

The opening presentation by Charles Himmelberg featured an outlook for US gross domestic product,

2008 PREA Institute the Fed funds rate, inflation and ten-year Treasurys, among other credit market and economic indica- June 12-13, 2008 tors. Himmelberg talked extensively about the nature of the credit crunch and about the headwinds Now It’s The Wait for Capital and tailwinds influencing the broader economy, with particular emphasis on energy prices. Columbia Instead of The Weight of Capital Professor Christopher Mayer continued the dialogue by asking attendees to share their internal rate of

The Paul Milstein Center for Real Estate at Columbia Business School, Columbia University, New York, NY

URIS Hall Room 142, 1st Floor 117th and Broadway return (IRR) expectations. Mayer then spoke about the housing market, breaking it down geographically into “cyclical,” “steady,” and “recently booming” classifications, and stressing that the different cap rates -as sociated with each classification would have implications for the impact of interest rate changes. Mayer also touched on the shifting capital markets, observing that traditional sources of investment fund- 18 ing would gain renewed prominence as the progenitors of the “wall of capital” of recent years further faded. During the luncheon break, Columbia’s William Duggan offered advice to attendees on fostering innovation in their workplaces. He stressed the importance of keeping an open mind with regard to unconventional new ideas as well as the value of adapting existing ideas to new strategic problems. Following lunch, Robert Lieber, New York City’s deputy mayor for economic development, spoke about the key elements of accommodating future growth in the city’s working and residential populations, which will require major transportation improvements and proactive government collaboration with the business community. Columbia’s Lynne Sagalyn then narrowed the focus from the city in general to large-scale development ventures and, in particular, New York’s West Side Yards project. She ob- served how the West Side Yards are characteristic of large-scale projects in terms of scale, timeline and economic counter-cyclicality, talked about the role of the Metropolitan Transportation Authority (MTA) and other government agencies in overseeing and supporting progress, and underscored how many disparate actors and entities would have to come together to see the project through to completion. The second day of the Institute began with a look at short selling by resident Columbia expert Charles Jones. He enumerated the pitfalls of allowing unbridled short selling, which include market manipulation, as well as the benefits of the practice, among which are the acceleration of the price discovery process and the deflation of bubbles. Jones looked back at the decades-long debate over the merits and disadvantages of short-selling, shared evidence from the derivatives market and elsewhere that short selling truly influ- ences pricing, and conveyed information about the prevalence and alpha-capturing potential of short selling. The Institute concluded with a panel led by Professor Mayer and Michael Giliberto and joined by Geoffrey Jervis and PREA Institute Chairman Jeffrey Barclay. Panelists discussed capital and real -es tate market issues globally, including the strength of the CMBS market, international capital allocation and property market opportunities. Conference discussions also included assessments of real estate valuation and the broader economic situation. It was agreed that government action up to that point, including the opening of the Federal Reserve window to a wider group of borrowers, were helpful but potentially insufficient. Pension Real Estate Association Annual 20 Report 08

19 Pension Real Estate Association

Products and Services continued PREAPREA Quarterly Quarterly Winter 2008 20 O n e -o n -O n e Richard Thaler discusses behavioral Winter2008 economics 26 IN THIS ISSUE F e a t u r e s n Repricing risk PQuartREerlAy n Risk of credit innovations n Global investment environment n COVER STORY: Top investors and managers discuss portfolio construction 44 Cover Story A PREA Roundtable about portfolio construction in coming years n One-On-One: University of Chicago economist Richard Thaler Page 44 Portfolio of talks about his new book Nudge T o m o r r o w n Professor Tim Riddiough on the "Addictive Qualities of Cheap and Easy Debt" n Nori Gerardo Lietz and Angelika Eiol on global property investment

a q u a r t e r l y p u b l i c a t i o n o f t h e p e n s i o n r e a l e s t a t e a s s o c i a t i o n

Constructing the “portfolio of tomorrow” was the subject of this issue’s cover story, which featured a roundtable of leading investors and managers discussing the eponymous topic. An esteemed panel considered both long-standing portfolio management issues like diversification as well as 20 emerging concerns like allocations to hedge funds and derivatives investment. The Editor’s Let- ter of the Winter Issue opened with the words, “risk and re-pricing pervade today’s investment vocabulary,” and indeed a number of articles made reference to the growing signs of disturbance in the real estate world. In one Feature article, for example, Timothy Riddiough of the University of Wisconsin republished a piece he had written before the downturn began, cautioning investors about signs of irrational exuberance. That being the case, many authors focused on other topics and concerns, such as the balance between risks and rewards in global property investment and the construction of risk-adjusted hurdle rates for real estate investment in Brazil and Mexico. The One-on-One was a discussion with Chicago economist Richard Thaler about his work in behavioral economics and, particularly, about his term libertarian paternalism, the notion that government and institutions can in some cases helpfully guide people’s actions without restricting their indi- vidual freedom (the guiding principle of Thaler’s recently published book). Winter Issue Pension Real Estate Association Annual 20 Report 08

Spring 2008

20 O n e -o n -O n e David D. Hale gives a global macroeconomic IN THIS ISSUE S p r i n g 2 0 0 8 perspective 24 F e a t u r e s PQuartREerlAy On open-end commingle funds and the secondary n market for non–real COVER STORY: A roundtable of industry leaders looks at accounting estate private equity funds

59 Plan Sponsor C o r n e r Liability-driven and valuation in a changing environment investing as a V a l u a t i o n s risk mitigation tool in a Changing Environment n One-On-One: Global economist David Hale considers the US financial crisis P a g e 2 8 n A plan sponsor perspective on liability-driven investing n The ins and outs of open-end commingled funds

a q u a r t e r l y p u b l i c a t i o n o f t h e p e n s i o n r e a l e s t a t e a s s o c i a t i o n

As in the issue preceding it, the cover story for the Spring 2008 Quarterly was a roundtable of highly respected investors, managers and, in this case, consultants. Though the format was the same, the tone of discussion was markedly different, with a focus on accounting and valuation in a changing environment. The One-on-One with global economist David Hale included commentary 21 on the US financial crisis. Currency exchange and the growing role of the Chinese economy and sovereign wealth funds were also debated. The Plan Sponsor Corner writer delved into liability- driven investing, and the Global Markets team compared appraised values with their correspond- ing realized sales prices in the United Kingdom. Feature articles included an assessment of the advantages and drawbacks of open-end commingled funds and a look at the secondary market for real estate fund interests. A special Update article explained the factors underlying the NCREIF Property Index’s return and appreciation figures during the previous two quarters, while Point of View writers extolled the virtues of rotational investing, an approach that takes into account the cycles in different property types and geographic markets. Collectively, articles in the Spring issue reflected how the debt and real estate market troubles had worsened, but the growing dimensions of the economic slowdown were only beginning to become apparent. Spring Issue Pension Real Estate Association

Products and Services continued PREAPREA Quarterly Quarterly Summer 2008

Dale anne Reiss Barry Sternlicht Summer2008 IN THIS ISSUE alan leventhal Sam Zell PQuartREerlAy Steven Roth Stephen Furnary n COVER STORY: CEO ROUNDTABLE, Stephen Furnary, Alan Leventhal, 2 0 0 8 CEO Dale Anne Reiss, Steven Roth, Barry Sternlicht, Sam Zell R o u n d t a b l e n One-On-One: Todd C. Lee of Global Insight assesses China’s economy n Wharton Professor Joe Gyourko on the CMBS model n Raymond Torto provides some historical perspective

a q u a R t e R l y p u B l i c a t i o n o F t h e p e n S i o n R e a l e S t a t e a S S o c i a t i o n

A panel of top chief executives from the real estate industry came together in New York for this issue’s cover story roundtable. Given the darkening economic picture, the first question from moderator Dale Anne Reiss was about the real estate and business climates. Panelists agreed that the 22 current downturn was distinct from those in the past in several respects, including unemployment numbers, commercial real estate supply and the relative importance of non-US economies. De- spite some positive signs, there was agreement that conditions could worsen . In the One-on-One, Global Insight’s Todd C. Lee answered questions about China, including the outlook for economic and middle class growth and foreign direct investment in the country. Feature article writers commented on the condition of the commercial mortgage securitization model and on the state of the commercial real estate and capital markets. Raymond Torto contextualized the situation by making comparisons among property types and time periods along the dimensions of vacancy rates, overbuilding and speculative leasing. In the Capital Markets Report, Jim Clayton struck a balance by acknowledging a high level of real estate market stress and broader economic uncer- tainty, while presenting evidence that projections of an outright market collapse were overblown. Summer Issue Pension Real Estate Association Annual 20 Report 08

Fall 2008

24 One-on-One Edwin Truman on sovereign wealth funds IN THIS ISSUE F a l l 2 0 0 8 Features 30 Energy prices and the value of PQuartREerlAy the dollar: their impact on real estate n COVER STORIES, Determining where to find investment opportunities investments 36, 42 Opportunities in two BRIC countries examined n One-On-One, Peterson Institute Senior Fellow Edwin Truman 48, 56 U.S. opportunities Where Are the Opportunities shares his sovereign wealth fund expertise Now? n PREA Plan Sponsor Survey results presented n Exploring the implications of energy price spikes, inflation and currency movement

a q u a r t e r l y p u b l i c a t i o n o f t h e p e n s i o n r e a l e s t a t e a s s o c i a t i o n

Anxiety about the real estate and economic outlooks had, by the time the final issue of 2008 was published, become a significant element of most investment deliberations, as was evident in the four cover story articles about investment risks and opportunities. Two authors focused on non- core US real estate, including first-mortgage and mezzanine lending. Another looked more closely 23 at Brazil, and specifically, at the state of the four major property types and capital markets in major cities like Rio de Janeiro. A fourth writer gave special consideration to the ways global investors can gain exposure to real estate in India. In the One-on-One, Edwin Truman, a senior fellow at the Peterson Institute for International Economics, identified the four major myths about sovereign wealth funds, especially the notion that these funds are uniformly distinct from US-based plan sponsors, and commented on progress among SWFs in the area of best practices. In a Feature article, RREEF’s Alan Billingsley considered three important trends (inflation, energy price increases and the devaluation of the US dollar relative to other currencies) and their implications for global trade, office and residential location patterns, construction costs and the appeal of green building.

Summer Issue Fall Issue Pension Real Estate Association

Products and Services continued QuarterlyPREA Quarterly Writers Writers Winter Issue Simon Mallinson and Research Team, IPD William Heitmann, Verizon Edgar Sullivan, General Motors Martha Peyton, TIAA-CREF Asset Management Mark Roberts, Invesco Doug Poutasse, NCREIF Sara Stratton, Qwest Bob Staley, Denise Stake, Masa Ozaki, Mark Yusko, Morgan Creek Capital Cornerstone Realty Advisers LLC Richard Thaler, the Ralph and Dorothy Keller Jared Chase, PREA Distinguished Service Professor of Behavioral Science and Economics at the University of Summer Issue Chicago’s Graduate School of Business Stephen Furnary, ING Clarion David Blum, Scott Urdang, Alan Leventhal, Beacon Capital Partners Urdang Capital Management Dale Anne Reiss, retired from Ernst & Young Nori Gerardo Lietz, Angelika Eibl, Partners Group Steven Roth, Vornado Realty Trust Timothy Riddiough, James A. Graaskamp Center Barry Sternlicht, Starwood Capital Partners for Real Estate, University of Sam Zell, Equity Group Investments, LLC 24 Wisconsin-Madison Todd Lee, Managing Director Laura Bader, Lennine Occhino, Mayer Brown LLP for the Greater China Division in the Jonathan Litt, Citigroup Investment Research Country Intelligence Unit of Global Insight Jim Clayton, PREA Youguo Liang, Prudential Real Estate Investors Simon Mallinson and Research Team, IPD Jacques Gordon, Bill Maher, Richard Kleinman, Barden Gale, Steven Bloom, LaSalle Investment Management ABP Investments US, Inc. Joseph Gyourko, The Wharton School, University of Pennsylvania Spring Issue Raymond G. Torto, CB Richard Ellis John Baczewski, Real Estate Jim Barry, Lee Morlock, Mayer Brown LLP Fiduciary Services LLC Craig Leupold, Green Street Advisors Charles R. Carpenter, Jim Clayton, PREA State of Wisconsin Investment Board Simon Mallinson and Research Team, IPD Christopher J. Dubrowski, Deloitte & Touche LLP Jared Chase, PREA Stephen Hansen, ING Clarion Matthew Kimmel, Deloitte Fall Issue Financial Advisory Services LLP Alan C. Billingsley, RREEF Alternative Investment Jon Martin, AEW Capital Management L.P. Thomas Conway, M3 Capital Partners Ken Riggs, Real Estate Research Corporation Anuj Gupta, South Asian Asset Rich Trusz, UBS Global Asset Management Management Limited Dennis P. Yeskey, Deloitte Consulting LLP Larry Hass, Josh Sternoff, Rebecca Cambreleng, David D. Hale, global economist and Paul, Hastings, Janofsky & Walker LLP chairman of David Hale Global Economics Cara Leonard, Lowe Enterprises Investors Joseph D. Stecher, Morgan Stanley Paul McEvoy, DRA Advisors, LLC Investment Management Edwin M. Truman, Senior Fellow at the Michael Golubic, The Townsend Group Peterson Institute for International Economics Gary P. Stevens, James J. Sunday, Ian Lewis, Cindy Xin, Mayer Brown LLP Landmark Partners Craig Leupold, Green Street Advisors Robert Fitzsimmons, Mayer Brown LLP Jim Clayton, PREA Craig Leupold, Green Street Advisors Angela Sheahan, IPD Jim Clayton, PREA Pension Real Estate Association Annual 20 Report 08

Products and Services continued ResearchResearch Review Review In this year’s Research Review: n 23 Reviews n 18 Independent Reviewers n 36 Abstracts n 176 References to Additional Papers n 6 Broad Research Areas n 24 Journals Cited n Call for Papers for the 2009 PREA-Sponsored Journal of Portfolio Management Each year, PREA enlists recognized professionals from the institutional real estate investment

community to review and offer their commentary on selected articles published in various Pension Real Estate Association industry research journals during the previous year. This year, 23 articles were reviewed that, together, encompassed the following research areas: n Performance and Valuation: These articles cover the returns associated with various real PREA 25 RESEARCH REVIEW estate indices, as well as issues of pricing, liquidity and appraisal. 2 0 0 8 n Portfolio Management: This section deals with questions of asset allocation, risk management, trading intensity, and other portfolio-level concerns. n Property Markets: Different property types and geographic markets, as well as niche 2008pension real estate association strategies like transit-oriented development, are the focus of these articles. n Public Markets: Articles in this section pertain to the characteristics of REIT investing, including capital structure and returns. n International: Global real estate investing, including inter-country analysis and an explo- ration of prospective risk management benefits, is the subject of these articles. n Debt: Lending, leverage and the capital markets figure prominently in these articles, many of which examine issues specific to the CMBS and CDO world. Each review includes a description of the research, a look at the paper’s data and methodol- ogy, deliberation about what the research means for investors, and an accounting of the “caveats,” or limitations in terms of design or applicability. As in past issues, an “index of other papers” concludes the 2008 Research Review. New for this year are lists of abstracts from papers of particular interest to property investors that were not otherwise reviewed.

Selected Titles, Authors and Reviewers What Drives the Return on CMBS? Xiaoqing Eleanor Xu Reviewed By Steven Copulsky Illiquidity and Pricing Biases in the Real Estate Market, Zhenguo Lin, Kerry Vandell Reviewed By Martha Peyton Trading Intensity and Real Estate Performance, Dirk Brounen, Piet Eichholtz, David Ling Reviewed By Nathan Zinn The Substitutability of REITs and Value Stocks, Stephen Lee, Simon Stevenson Reviewed By Jim Clayton Pension Real Estate Association

Products and Services continued JREPMJournal Of Real Estate Portfolio Management SPECIAL ISSUE In 2008, PREA teamed with the American Real Estate Society (ARES) to produce a special issue of the Journal of Real Estate Portfolio Management focused on institutional property investment. Thirteen papers were chosen for publication from among the nearly 30 submitted by researchers both global and domestic, and from both the academic and practitioner communities. Selected papers fell into several broad categories: the role of real estate in institutional investment portfolios, real estate portfolio management risks, property valuation, the implications of environmental and religious standards for real estate investment and REIT volatility. The sponsorship of this journal publication falls within PREA’s mission of providing high-quality real estate research to its members and the institutional investment world. PREA also fulfills this mandate through periodic collaboration with other organizations like Institutional Investor (in the publication of the special real estate issue of the Journal of Portfolio Management), by hosting the annual PREA Institute alongside the faculty of top academic real estate programs including those 26 of the University of Pennsylvania and Columbia University, and through oversight of the meetings and publication activities of the Real Estate Research Institute.

Selected Titles and Authors Liquidity Dynamics in Commercial Real Estate, Brian W. Buckles Real Estate Investment Style and Style Purity, Martha S. Peyton Assessing and Managing Risk in Institutional Real Estate Investing, Ron Kaiser and Jim Clayton Integration of International Office Markets and Signal Extraction, Chris Brooks and Sotiris Tsolacos Shariah Compliance in Real Estate Investment, Muhammad Faishal bin Ibrahim and Seow Eng Ong Bayesian REIT Volatility Estimation and Institutional Portfolio Allocation, Colin Ward

Journal of Real Estate Portfolio Management Editorial Board

Randy Anderson Jun Han Stanly McGreal Brian Webb Brad Case Robert Hess Glenn Mueller James Webb Ping Cheng Liow Hiang Neil Myer Patrick Wilson Jim Clayton Liu Hongyu Graeme Newell Charles Wurtzebach Michael Giliberto Aart Hordijk Joseph Ooi Michael Young Richard Gold William Hughes Steven Ott Stephen Roulac Jacques Gordon Steven Kapplin Joseph Pagliari Arthur Schwartz Richard Graff Steven Laposa Douglas Poutasse Simon Stevenson Wylie Greig Youguo Liang Stephen Pyhrr Raymond Torto Michael Grupe Frederich Lieblich Kenneth Riggs Ko Wang Joseph Gyourko Marc Louargand Nico Rottke Chau Wing Pension Real Estate Association Annual 20 Report 08

ScholarshipsScholarships In keeping with our educational mission, PREA awards scholarships on an annual basis to promising students studying real estate at the undergraduate and graduate levels. PREA also partners with the Robert A. Toigo Foundation to grant a PREA/Toigo scholarship which is awarded to minority and women students. Since 1994, PREA has awarded nearly $350,000 in scholarships to more than 100 graduate students concentrating in real estate studies at over 29 academic institutions in the United States and Canada.

PREA Real Estate Scholarship Recipients

Alex Fenigstein Casey McGrath Daniel Spear NYU Schack Institute of Real Estate University of California Columbia Business School. San Diego

Aaron Gabbart Peng Fei 27 Marriott School at University of Matthew A. Summers Brigham Young University Southern California Bucknell University

Kwan Ok Lee Marc Ramme Michael Travalini University of Southern California University of Washington Northwestern University

Sanghyun Lee Matthew I. Rufo Sloan School at MIT and Kennedy Shawn Ursell University of Pennsylvania School of Government DePaul University School of Design

PREA-Toigo Scholarship Recipients

Gina Baker Chambers Lawrence Ou Columbia Business School Columbia Business School

Tirso Fernandez University of Chicago Tony Wei Graduate School of Business UCLA’s Anderson School of Management

Angela Johnson Harvard Business School Pension Real Estate Association

BoardBoard of Directors of Directors

Russell Appel, Chairman Field Griffith Praedium Group LLC Virginia Retirement System

Jamie Behar, Vice Chairman William Heitman General Motors Asset Management Verizon Corporation

Raymond Torto, Treasurer Charles Leitner CB Richard Ellis RREEF

Glenn Lowenstein, Secretary Mary Ludgin The Lionstone Group Heitman 28

Quinton Primo III Laurie Dotter, Vice Chairman Capri Capital Partners LLC Plan Sponsor Council Executive Committee Hunt Realty Investment

Dale Anne Reiss Jon Braeutigam Ernst & Young LLP Michigan Department of Treasury

Brian Schneider University of Pennsylvania Theodore Eliopoulos Investment Office California Public Employees’ Retirement System

Karl Smith Jr. Jeffrey Fisher Russell Investment Group Indiana University Center for RE Studies, Kelley School of Business

Sara Stratton Gloria Gil Qwest Asset Management Company University of California

Micolyn Yalonis Jonathan Gray The Townsend Group The Blackstone Group

Lawrence Hass, Counsel to the Board, Paul, Hastings, Janofsky & Walker LLP Pension Real Estate Association Annual 20 Report 08 PlanPlan Sponsor CouncilSponsor Executive Committee Council Devon Olson, Chairman Gloria Gil Utah Retirement Systems University of California

Laurie Dotter, Vice Chairman Steve Hason Hunt Realty Corporation APG Investments US Inc.

Peter Katseff Jamie Behar Tennessee Consolidated Retire- General Motors Asset Management ment System

Peter Crosson Michael Speidel Alaska Electrical Pension Fund Brown University Investment Office

29 Mike DiRe Marjorie Tsang California State Teachers’ New York State Common Retire- Retirement System ment Fund

Joan Fallon U.S. Steel & Carnegie Pension Fund

Pension Real Estate Association

PREAPREA Committees Committees

Conference Committee Holly T. Reynolds, BPG Properties, Ltd. Committee Co-Chairs: Vicky L. Schiff,AVP Advisors, LLC David Boyle, Morgan Stanley Timothy V. Schlitzer, Mass PRIM Greg Moran, Dividend Capital Group Jamie Shen, Callan Associates, Inc. Committee Members Max Swango, INVESCO Real Estate Spencer Haber, H/2 Capital Partners LLC Christopher White, Fortis Investments Peter Katseff,Tennessee Consolidated Retirement System Publications Committee Howard Margolis, Black Creek Group Committee Chairman Trina Bigby-Sanders, LACERA Kevin Maxwell, TIAA-CREF Committee Members Government Affairs Committee Susan Swindell Carter, North Carolina Committee Chairman Retirement System Joel Rubin, Sayfarth Shaw LLP Philip Conner, Prudential Real Estate Investors Committee Members Robert Douglas, OPSEU Pension Trust 30 Joseph Christian, Hale & Dorr Joan Fallon, U.S. Steel & Carnegie Pension Fund Scott Darling, American Realty Advisors Jay Farris, Alston & Bird Research Committee Steven Greenspan, JPMorgan Asset Management Committee Chairman Lawrence Hass, Paul, Hastings, Youguo Liang, Prudential Real Estate Investors Janofsky & Walker LLP Committee Members Herbert Krueger, Mayer, Brown, Rowe & Maw Michael Acton, AEW Capital Management, L.P. John Kuhl, Cox, Castle & Nicholson LLP Scott D. Brown, CB Richard Ellis Investors, LLC Lennine Occhino, Mayer, Brown Rowe & Maw Jeffrey Fisher,Indiana University William Salisbury, Fiduciary Services S. Michael Giliberto, JPMorgan Asset Management Jacques Gordon, LaSalle Investment Institute Committee Management, Inc. Committee Chairman Charles Haase, California State Teachers Jeffrey Barclay, ING Clarion Retirement System Committee Members Doug Herzbrun, CB Richard Ellis Investors, LLC Sheila Kneeshaw, City of Detroit-General William Hughes, UBS Asset Management Retirement System David Lynn, ING Clarion Real Estate Felix Lechner, GLL Real Estate Partners GmbH Asieh Mansour, RREEF/DB Real Estate Mary Ryan McCarthy, Hines Will McIntosh, University of Cincinnati Pamela Wright, Credit Suisse First Boston David Morrison, Morgan Stanley Eric Wurtzebach, Macquarie Capital (USA) Inc. Glenn Mueller, Denver University, Dividend Capital Group Membership Committee Joseph Pagliari, University of Chicago Committee Chairman Monica Parikh, Metzler Realty Advisors Robert Vogelzang, Triton Pacific Capital Martha Peyton, TIAA-CREF Committee Members Edward Pierzak, Henderson Global Investors Victor Del Pizzo, Alcatel-Lucent Juri Pill, Oxford Properties Group A. Brent Elkins, AMB Capital Partners Cate Polleys, Fidelity Management Patrick Kendall, Cornerstone & Research Company Real Estate Advisors, LLC Douglas Poutasse, NCREIF Jeffrey Kusumi, Rubenstein Company, L.P. Mark Roberts, INVESCO Real Estate Christian MacDonald, Buchanan Street Partners Karl Smith, Russell Investment Group Tuba Malinowski, Principal Real Estate Investors R. Brian Webb, UBS AgriVest Barbara McDowell, ORG Portfolio Management LLC Dennis Yeskey, Deloitte Susan Neuberg, Sutherland, Asbill & Brennan, LLP Pension Real Estate Association Annual 20 Report 08

Affinity Group Leaders Green Alternatives Todd Briddell, Urdang Heather Goldman, Starwood Capital Mark Billeci, Principal Real Estate Investors Group Global, LLC Peter Madden, ABP Investments US, Inc. International Joyce Shapiro, Brookfield Asset Capital Markets Management, Inc. Devin Murphy, Coventry Real Estate Howard Margolis, Black Creek Capital Advisors, LLC Frank Schmitz, Park Hill Real Estate Group reporting John Baczewski, Real Estate Fiduciary Development Services LLC Bret Wilkerson, Property & Portfolio Research, Inc. Chris Hughes, Hines 31 Pension Real Estate Association

PREA PREAStaff Staff andVision Vision Gail Haynes To serve and educate our members in the President global institutional real estate investment community regarding real estate investments. Elizabeth Reegan Consulting Director of Advertising Sales n Our membership is inclusive and diverse Sue Marshall n We meet their needs by providing Consulting Director of Communications valuable, balanced, useful information in Amy Laffargue a technologically advanced manner Director of Meetings and Events n We provide superior interactive forums Sandra McDermott Member Services Associate n We promote high standards of industry practice and professionalism Jim Clayton 32 Director of Research

Jared Chase Staff Writer and Editor

Darlene McIntosh Accountant

Wanda Molina Executive Assistant Pension Real Estate Association Annual 20 Report 08 2008PREA Headlines Staff

A Bear Market, Mauling Not Included–New York Times, July 6

Crisis? What Crisis?—Pensions & Investments, September 12

Global Recession Fears Batter US Stocks—Financial Times, October 24 33

Bear Stearns Goes Bust—NPR, March 17

Lehman Goes Under, Financial System Braces for Storm—US News & World Report, September 15

Paulson Defends Bear Stearns Bailout—The Associated Press, March 17

Crisis on Wall Street: Lehman Brothers to File for Chapter 11 Bankruptcy; Bank of America Buys Merrill Lynch; Insurance Giant AIG Agrees to Restructuring Following 31% Share Plunge on Friday—FinFacts Team, September 15 Pension Real Estate Association

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