Active Private Equity Real Estate Strategy

DAVID J. LYNN, PHD, is Managing Director and Head of ING Clarion Partners' Research & Investment Strategy Group. He is also a member of the Investment Committee as well as the Operating Committee of ING Clarion Partners. Lynn is a Counselor of Real Estate (CRE), a Certified Portfolio and Investment Manager (CPIM), a Chartered Management Analyst (CMA), a Certified Planner (AICP), and a Homer Hoyt Fellow. Lynn earned his PhD in financial economics from the London School of Economics where he also earned a master of science degree specializing in finance. He also earned an MBA from the Sloan School of Business, Massachusetts Institute of Technology. TIM WANG, PHD, is Head of Macroeconomic Analysis and Strategy at ING Clarion. He has an MBA from New York University and a PhD from the University of Georgia. MATSON HOLBROOK is a former senior associate at ING Clarion. He holds an MS in real estate from New York University and a BS in cartography and geographic information systems (GIS) from the University of Wisconsin. BOHDY HEDGCOCK is an Associate at ING Clarion. He holds a master's in urban planning from the University of Colorado. JEFF ORGANISCIAK is a Senior Analyst at ING Clarion. He graduated from the University of Pennsylvania with a BA in economics and political science. ALISON SAUER is an Analyst at ING Clarion. She is a graduate of Tufts University where she earned a BS in mathematics. YUSHENG HAO is an Analyst at ING Clarion. He holds an MS in financial engineering from Baruch College, CUNY.

• Preface ixDisclaimer xiiiAcknowledgments xvAbout the Authors xviiPART ONE Market Analysis and Forecasts 1CHAPTER 1 Overview of the U.S. Real Estate Market 3Tim Wang and David LynnCHAPTER 2 Forecasting the U.S. Market 19David LynnCHAPTER 3 Recession Simulation and Its Effects on Real Estate 25Tim Wang, Alison Sauer, and David LynnCHAPTER 4 Subprime Fallout: The Impact on Commercial Real Estate 41Tim Wang and David LynnCHAPTER 5 Capital Markets: Dramatic Shifts and Opportunities 47David Lynn and Tim WangCHAPTER 6 The Bid-Ask Problem and Game Theory 53Jeff Organisciak, Tim Wang, and David LynnPART TWO Active Strategies 67CHAPTER 7 Residential Land Investment 69Bohdy Hedgcock and David LynnCHAPTER 8 The U.S. Hotel Market and Strategy 103Tim Wang, Matson Holbrook, and David LynnCHAPTER 9 Global Gateway Industrial Market Investment 125Bohdy Hedgcock and David LynnCHAPTER 10 The Opportunity in Senior Housing 159Tim Wang and David LynnCHAPTER 11 Active Portfolio Management Using Modern Portfolio Theory 187David Lynn and Yusheng HaoCHAPTER 12 Derivatives in Private Equity Real Estate 217Jeff Organisciak, Tim Wang, and David LynnCHAPTER 13 Opportunities in Infrastructure Investment 239David Lynn and Matson HolbrookAPPENDIX A Typical Land Development Pro Forma Analysis—Three Scenarios 247APPENDIX B U.S. Hotel Chain Scales 253APPENDIX C Modern Portfolio Theory in Real Estate Portfolio Analytics 257APPENDIX D Commercial Real Estate Indexes 259APPENDIX E Example NPI Forecast Methodology 263Selected Bibliography 265Index 267