Following a global real estate downturn, it might be easy for investors to forget the discipline and benefits of maintaining a well-diversified real estate portfolio. And while we see near-term opportunities here in the United States, pursuing a narrow, U.S.-only strategy over the long term would concentrate economic and market risks within a single economy over a period when indications are that the U.S. economic cycle likely will lag other parts of the world, particularly the Asia Pacific region.

In surveying the globe for potential real estate investments, we believe the best risk-adjusted opportunities for real estate investing presently are located in the United States. Persisting constraints on debt financing have been the primary cause of the sizable drops in asset prices during the past 18 months. The obvious additional challenges, such as the subprime lending excesses and the CMBS meltdown, are issues that are taking time to work through the market. As a result, we b