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Public Eye
News and views impacting public funds
Spring-Summer 2015
IN THIS ISSUE
• Public voice: Meredith Williams, Executive Director of the
National Council on Teacher Retirement (NCTR), makes a
compelling case for the importance of public pension plans
and discusses the political challenges they face.
• Confidence boost: As sentiment improves, Anastasia Amoroso,
Global Market Strategist, explores reasons why 2015 will be
the year of the U.S. consumer.
• 2015 U.S. commercial real estate outlook: Attractive commercial
real estate values can be found in properties that will benefit
from improved tenant demand as well as muted supply.
• Active allocation views: Views from our Global Investment
Management Solutions-Global Multi-Asset Group.
LIKE 2014, 2015 will be a year in which low yields and equities
remain strong. Despite higher U.S. domestic production, lower oil
prices still act as a tax break for Americans who devote a large
share of their income to energy spending. With lower gasoline
prices, rising employment and, most likely, rising wages, 2015
should be a year of broadening U.S. expansion, with consumer
spending leading the way.
In this evolving investment landscape, many of our public plans
are evaluating how they can best position assets for growth while
managing risk. They are asking for our latest thinking and insights
to inform these decisions. To that end, we have developed this
semi-annual newsletter to deliver some of our latest thinking to
you in one consolidated format and offer our partnership and
perspective as you continue to refine your portfolio.
Thank you for your continued trust and confidence in
J.P. Morgan Asset Management.
Public voice
Meredith Williams, Executive Director of the
National Council on Teacher Retirement (NCTR),
makes a compelling case for the importance of
public pension plans and discusses the political
challenges they face.
Q: Tell us about NCTR, whose membership includes 68
state, territorial, and local pension systems, serving
nearly 20 million active and retired teachers and
other public employees. What is the group’s mission
and what is your role?
WILLIAMS: Number one, we advocate for retirement security
for public servants, particularly those in the educational field.
We think that's a really important issue, and it's under increasing attack. Our constituencies include the systems, trustees and
administrators as well as our commercial associate members.
We enable these constituencies to come together and learn
what’s going on in the industry. When we all get together, it’s a
loud gathering, because everybody has a unique perspective.
As executive director, I report to an executive committee comprised of five trustees and five administrators.
Q: What investment trends are you witnessing across the
public funds landscape?
WILLIAMS: People are very in tune with what their liabilities
PROFILE
Meredith Williams
Executive Director of the National
Council on Teacher Retirement (NCTR)
Education:
BS: Business Administration, Economics, University of Kansas
JD: Washburn University School of Law
First job: Parts runner, McCarney Ford, Bismarck, ND
Date started with NCTR: July, 2012
Hobbies: Home DIY
Favorite movie: “Bullitt”
Favorite book: “The Presidents Club”
Q: What can be done about that?
WILLIAMS: Our funds need to do a better job of educating
both their own membership and the public. They need to
explain to their beneficiaries and contributors why these pension plans are so important, and why people need to be actively engaged in reaching out to the wider political environment
they live in.
Q: What effective arguments can they make?
are doing today and tomorrow, and they are considering how
liability management impacts asset allocation. We're seeing far
more asset allocation studies, and we're seeing them done on
a more regular basis. I think we've got to be careful that we
don’t get away from the fact that we represent long-term,
patient capital investors. We want to be sustainable for
decades down the road.
WILLIAMS: Public pension plans can let legislative decision-
Q: What has been the biggest challenge in your job and
in your prior jobs as the Executive Director of the
Colorado pension fund and the Executive Secretary of
the Kansas public pension plan?
Q: During your tenure in Colorado, the state legislature
took important action to improve the plan’s funding
status. How did that happen?
WILLIAMS: The biggest challenge is politics. In days gone by,
enhancements put in place that, in retrospect, were pretty
expensive. By 2008, we realized that we were no longer a sustainable system, and that, in fact, we would run out of money
in the foreseeable future. That’s breaking a sacred trust with
your employees, employers and taxpayers. We knew we had to
change, sooner rather than later. Our solution was something
we called “shared sacrifice.”
people from both sides of the political aisle came together to
make the necessary changes for a pension system. Today it's
becoming very partisan and that makes it much, much harder. I’m
old enough to remember when public pensions, as a whole, were
under the radar screen. Now we’re targeted. Everyone seems to
have their own solutions and oftentimes they’re pretty scary.
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P UBL IC EY E: S P R IN G-S UM M ER 2 0 15
makers know how economically impactful these plans are. I
think we undersell and underplay that. The nice thing about
our benefit structures is that our benefits are constant. When
the economy goes down and employment drops off, those benefit checks are still going out. In certain jurisdictions, they are
just a huge, huge force.
WILLIAMS: In the late 1990s, there were some benefits
Q: How did that work?
WILLIAMS: Benefits were lowered. People had to work longer
before they became eligible to retire. Employers had to pay
incrementally more into the system. With patience and with
everyone fulfilling their obligations under the law, it continues
to work. It’s key that those contributions come in as planned, on
a systematic basis, year after year. Absent that, it doesn't work.
Q: How does NCTR help member organizations with their
fiduciary responsibilities?
WILLIAMS: The focus of our educational offerings will vary
from year to year, but they always have an underlying fiduciary
concept to them. For the last couple of years, and into the current year, we’re pretty significantly focused on GASB.
Q: What about governance issues?
WILLIAMS: That's another huge issue and it illustrates the
diversity of our industry. Some plans have a sole trustee and
that can work really well. I’m not sure what the magic number
is in terms of board size. In Colorado, I had one of the bigger
boards, at one point there were 16 members. That gives you
great diversity of perspective, but at times it’s like herding cats.
Q: What keeps you up at night?
WILLIAMS: I'm really afraid of what things are going to look
like down the road as baby boomers are, frankly, forced into
retirement, and they're not prepared. I’m taking a broad view
here, across both the public and private sectors. For many people, retirement security is going to be pretty wobbly.
Q: Meredith, it has been a real pleasure speaking with
you. Thank you for your time and thoughts. One last
question before we end: What gives you the greatest
satisfaction in your work?
WILLIAMS: My greatest satisfaction has been the wonderful
people that I’ve been privileged to work with. They're dedicated and they take their jobs very seriously.
Confidence boost
Anastasia Amoroso, Global Market Strategist,
explores reasons why 2015 will be the year of the
U.S. consumer
AS SENTIMENT IMPROVES, 2015 WILL BE THE YEAR
OF THE U.S. CONSUMER
After a long stretch of sluggish growth, the U.S. economy is
finally kicking into higher gear. Give much of the credit to a
rejuvenated American consumer. On the four economic
measures most important to consumers—the unemployment
rate, gas prices, home prices and stock prices—Americans see
steady, and in some cases dramatic, progress. The pace won’t
let up: 2015, we believe, will be the year of the U.S. consumer.
A surge in consumer confidence
The mood has already shifted. During the last eight months,
consumer confidence, as tracked by the University of Michigan
survey, has suddenly surged. In April, the preliminary
consumer sentiment index stood at 95.9, just below January’s
expansion peak of 98.1 and well above the 84.1 level that
prevailed in April 2014. As can be seen in Exhibit 1 (on the
following page), Americans are far more hopeful about the
economic environment than they were just eight months ago.
No economic data point has done more to fuel that sense of
optimism than a falling unemployment rate, which reached
5.5% in February. Without question, the job picture has
brightened. The U.S. economy produced almost 600,000 net
new jobs in the three months ending in March and over 3.1
million in 2014, the best year for U.S. job growth in this century.
To be sure, wage growth has been a major disappointment;
in March, average hourly earnings for production and
nonsupervisory workers increased 1.8% from a year earlier.
But some economic indicators point to healthier paychecks
ahead. Not only are there more workers, but they are also on
the job for longer hours—non-farm business hours worked,
which combine these measures, rose 5.1% in 4Q 2014, the
biggest jump in 16 years (Exhibit 2). In another hopeful sign,
a growing percentage of small businesses plan to increase
employee pay. Historically, this measure coincides with a move,
nine months later, in actual wages and salaries.
J.P. MORGAN ASSE T MA N A G E ME N T
3
In the past eight months, consumer confidence has soared.
EXHIBIT 1: CONSUMER SENTIMENT INDEX, UNIVERSITY OF MICHIGAN,
1972-MARCH 2015 AND 12-MONTH S&P 500 RETURNS FOLLOWING
SENTIMENT CYCLE LOWS AND HIGHS
Consumer Confidence and the Stock Market
| 29
GTM – U.S.
Consumer Sentiment Index – University of Michigan
130
Impact on Consumer Sentiment from a…
10% y-o-y rise in gasoline prices
10% y-o-y rise in home prices
10% y-o-y rise in the S&P 500
1% y-o-y rise in the unemployment rate
120
Economy
110
100 Aug. 1972
-6.2%
90
-1.4 pts
+1.8
+2.8
- 4.4
Jan. 2000
-2.0%
Jan. 2004
+4.4%
Mar. 1984
+13.5%
May 1977
+1.2%
Jan. 2007
-4.2%
Average: 84.8
80
Mar. 2003
+32.8% Oct. 2005
+14.2%
70
Oct. 1990
+29.1%
60
Feb. 1975
+22.2%
50
40
Mar. 2015:
93.0
'72
'74
'76
May 1980
+19.2%
'78
'80
'82
'86
'88
'90
'92
'94
'96
'98
'00
'02
'04
'06
'08
'10
'12
'14
Source: Standard & Poor’s, University of Michigan, FactSet, J.P. Morgan Asset Management.
Peak is defined as the highest index value before a series of lower lows, while a trough is defined as the lowest index value before a series of higher
highs. Subsequent 12-month S&P 500 returns are price returns only, which excludes dividends. Impact on consumer sentiment is based on a
multivariate monthly regression between 1/31/2000 – 12/31/2014.
Data are as of March 31, 2015.
29
Source: Standard & Poor’s, University of Michigan, FactSet, J.P. Morgan Asset
Management. Peak is defined as the highest index value before a series of lower
lows, while a trough is defined as the lowest index value before a series of higher
highs. Subsequent 12-month S&P 500 returns are price returns only, which excludes
dividends. Impact on consumer sentiment is based on a multivariate monthly
regression between 1/31/2000–12/31/2014.
Data as of March 31, 2015.
Wage growth has been anemic, but workers are on the job
for longer hours—a hopeful sign.
EXHIBIT 2: HOURS WORKED FOR NON-FARM BUSINESS EMPLOYEES
Percent change from previous
quarter at annual rate
8
6
4
2
0
-2
-4
-6
-8
-10
-12
’94’95 ’96 ’97 ’98’99’00 ’01 ’02 ’03’04’05’06’07’08’09 ’10 ’11 ’12 ’13 ’14
Source: BLS, J.P. Morgan Asset Management; data as of March 19, 2015.
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P UB L IC EY E: S P R IN G- S UM M ER 2 015
The recent plunge in gas prices has delivered a major boon to
consumers, with the greatest benefit felt by those who need it
most. The percentage of household income spent on gas and
motor oil is six times greater for households in the lowest
quintile of pre-tax income than it is for households in the
highest quintile. Spending on gas for the average family should
decline $750 a year, the equivalent of a mini-tax cut. Given that
imbalances in global oil markets help determine the price of
gas at the pump—the picture is complicated, but the essential
theme is excess supply and less-than-robust demand—low gas
prices may linger for a while.
Nov. 2008 Aug. 2011
+15.4%
+22.3%
Sentiment Cycle Low and
subsequent 12-month S&P 500 Index
return
'84
Lower gas prices benefit those who need it most
A rebound in household net worth
Along with a falling unemployment rate and cheap gasoline
prices, a rebound in household net worth reaffirms the
swelling optimism of the American consumer. At the end of
2014, household net worth totaled $82.9 trillion, well above the
pre-crisis high of $67.8 trillion in the second quarter of 2007.
Those gains testify to a six-year bull market in U.S. equities as
well as rising house prices. On the housing front, consumers
are encouraged by recent data: Moderating home prices,
coupled with very low mortgage rates, are making housing
more affordable. At the end of 2014, average mortgage
payments accounted for 14.1% of household income; since
1975, that percentage has averaged 20.3%.
Investment implications
How should we assess the investment implications of a
resurgent U.S. consumer? Given that consumer spending
accounts for roughly two-thirds of GDP, we expect decent
economic growth this year, a 2.5% increase in GDP, despite the
higher dollar’s drag on exports. Positive economic momentum
should keep the Federal Reserve on track to raise the fed funds
rate sometime this year.
At its mid-March meeting, the Fed modified its forward rate
guidance to reflect the improved state of the economy,
removing the assurance that it would remain “patient” in
raising short-term rates. Emphasizing that its decisions will be
data-dependent, the Fed signaled that a potential rate hike will
be evaluated on a meeting-by-meeting basis.
Past experience tells us that stocks may react negatively over
the short-term period leading up to a rate increase. Over the
longer term, equities tend to rebound because earnings growth
remains solid despite incrementally higher rates.
Fixed income investing can be trickier. Fed rate hikes will likely
push short-term U.S. bond yields higher. Significant global
demand should keep longer-dated bond yields more anchored,
although a stronger U.S. economy and higher inflation expectations can eventually put upward pressure on longer-dated
yields as well. An improving economy bodes well for corporate
bond issuers, as it should keep default rates in check. Finally,
bond investors have many more options to invest outside their
home markets: Non-U.S. bonds represent 60% of the total
global bonds outstanding. When the Fed does move to normalize rates, a balanced bond portfolio, diversified across regions,
strategies and sectors and managed with careful attention to
security selection and risk control, can be especially effective.
REAL ESTATE SECTOR REVIEW
200 FIFTH AVENUE, NEW YORK, NY
Market Overview – Office sector
2015 U.S. Commercial Real Estate
Outlook
HIGH QUALITY CORE PROPERTIES ON A ROLL?
Commercial property prices have rebounded strongly since the
start of the economic recovery. Indeed, appreciation has been
vigorous enough that some investors worry that current
valuation levels are unsustainable. We now see high-quality
unleveraged core properties trading at internal rates of return
(IRRs) at just 6%, based on our current underwriting. This is a
low and, for some investors, a psychological barrier that makes
real estate feel more like bonds than equities. However, these
IRRs are still at a historically wide spread to 10-year U.S.
Treasuries, and our real estate return expectations remain
closer to our firm’s long-term capital markets assumptions for
equities than for bonds.
The inevitable back-up in interest rates will most likely come
from good economic news, so we target properties that will
benefit from the resulting improved tenant demand as well as
muted supply.
The office market recovery nationwide had been slowed by
weak hiring in finance and law but some stability in investment
banking payrolls—thanks partly to M&A activity—and continued
growth of asset management payrolls have driven top line
financial job growth (excluding bank branches) to its fastest
pace since 2006. Law firm hiring has remained weak, but an
exclusive group of white shoe firms that cluster in high quality
central business district (CBD) office buildings have enjoyed
business gains from the M&A boom. InfoTech, management
consulting, accounting, architectural and other business and
technical services are all hiring rapidly now as well. Overall, we
think the count of office submarkets falling below equilibrium
vacancy will continue to rise—with only moderate development
to mute the resulting sharp rent increases.
Supply remains delayed even as demand accelerates. Scarce
construction financing has been one factor, but so has a lack of
pre-lease-sized leasing requirements in most markets. Perhaps
more importantly, the highest use of land in many of the
nation’s most dynamic urban cores has been residential. Since
the start of 2013, more than 25 million square feet of office
buildings in structures more than 100,000 square feet have
been razed. As a consequence, net additions to stock were still
less than 0.5% in 2014. Large tech firms continue to disperse
in search of talent—creating dynamism in certain CBD or nearCBD submarkets, offering local amenities that attract the best
J.P. MORGAN ASSE T MA N A G E ME N T
5
workers. Seattle, Portland, Los Angeles, Chicago, New York,
Denver, and Boston, among others, see dynamism outside
their traditional CBDs but still within urban cores. Sterile boxes
in suburban office parks or amenity deserts within CBDs face
near-term headwinds—especially if they cannot be easily
commuted to from urban, infill residential locations.
quarter, same store sales growth at Class B malls has remained
negative. For Class A malls, same store sales growth has decelerated but is still positive.
Consequently, minimally amenitized suburban locations near
dynamic CBDs will continue to face headwinds—including some
locations around Chicago, New York and even San Francisco.
Large boxes in far-flung locations are on the wrong side of
virtually every trend we are observing. Grocer/drug-anchored
centers with convenience and services-oriented in-line stores
are good plays on organic economic growth as long as they are
in infill locations. Large outdoor formats continue to work if
they have high proportions of small shop space; in areas with
high density/income/educational attainment, a broader array
of formats will perform well.
We remain, as we have over the past decade, least enamored
by power centers except, perhaps, within dense urban areas.
VALLEY FAIR MALL, SAN JOSE, CA
Market Overview – Retail sector
We continue to expect Class A malls to deliver the agglomeration economies favoring strong overall mall revenue growth for
existing concepts and the best returns for new uses such as
high-end restaurants. In theory, Class B malls should be enjoying
tailwinds. However, the theory has not been proven. First, lower
oil prices are democratizing the consumer recovery because
energy costs account for a larger share of the spending by moderate income households. Second, continued low interest rates
remain as a nice tailwind to mid-tier retailers struggling with
high fixed costs. Finally, labor markets are improving for middle
income Americans. Mid-tier in-line stores have continued to
close at a rapid pace while luxury brands continue to grow. As
we have noted before, marginal clothing retailers are suffering
at the hands of fast fashion brands that have developed logistics
chains that can update fashions continuously instead of once or
twice per year. Fast fashion firms quickly copy luxury couture
styles but, ironically, hurt mid-tier shops most by matching their
pricing, but with more up-to-date fashion. Through the third
6
P U BL IC EY E: S P R IN G-S UM M ER 2 0 15
PROCTER & GAMBLE DISTRIBUTION CENTER, EDWARDSVILLE, IL
Market Overview – Industrial sector
The warehouse market’s great recovery has been driven largely
by consumers’ costly demand that Internet—purchased goods
arrive in just one or two days. Holding excess inventories to
guarantee quick delivery, along with other logistics costs, goes
a long way toward explaining why Amazon generates thin
profits. Low interest rates and cheap gasoline help a little but
do not significantly reduce the drag. Meanwhile, UPS and
FedEx rejected some last minute Christmas time express
deliveries from retailers that exceeded their previously agreedupon limits. This form of rationing was put in place to avoid
last year’s late delivery fiasco, and it may moderately reduce
growth in warehouse demand. However, at some point a larger
share of excess inventory and logistics costs will have to be
passed to consumers, who should then be expected to reduce
their demand for quick deliveries.
In the near term, some economizing in the logistics chain is
already incrementally moderating warehouse occupancy
growth at the same time supply is rising. Tenant-demand
growth for very large boxes (500,000+ square feet) in far-flung
locations on cheap land has slowed, making it even more
difficult to drive rent growth. Small infill boxes should achieve
higher rent growth, especially as they take advantage of the
new-urbanist trend and consumer demand for faster Internet
delivery. These commercial properties also enjoy locations that
are typically more supply constrained, as warehouse use in
these places is often not perceived to be the best use of land.
Unfortunately, small infill box portfolios do not trade often and
are expensive when they do.
Market Overview – Residential sector
Net operating income growth for apartments has re-accelerated
modestly as the housing market recovery delay has raised
tenant demand for rentals. This impact is most strongly felt in
economically-dynamic Western region markets, but we’ve also
seen stability and recovery in rent growth in Northeastern and
Midwestern region markets as well. Rents in many tech markets
will have to decelerate over the next year as reduced
affordability drives tenants to alternatives (rental houses,
roommates, etc). As we noted previously, pockets of oversupply
have cropped up and starts are accelerating. Since the
apartment market is largely priced above replacement cost, we
think appreciation should be muted in the long run and that the
best risk-adjusted returns for core investors may well be found
in development.
THE LOUISA, PORTLAND, OR
J.P. MORGAN ASSE T MA N A G E ME N T
7
Active allocation views
Asset class Opportunity set
Fixed income
Neutral
Max positive
Upgrade Downgrade
Positive Rationale
Equities/Bonds
Global economy is still in the early/mid and weak oil prices to boost DM consumption. It remains
attractive to take directional bets.
Duration
Move towards global QE: Weaker international growth vs. U.S. plus broad policy stimulus results in
high demand for long-duration risk-less assets.
Credit
Attractive from a carry perspective, decent fundamentals but vulnerable to bouts of illiquidity once
U.S. policy starts to tighten.
Commodities
Oversupply in some commodities and falling EM demand, but prices have already moved a long way.
U.S.
U.S. leads global growth, and we have the most confidence in the U.S. outlook for 2015. Flattening
curve supports U.S. large caps.
Europe ex-UK
ECB stimulus having a strong impact. Macro momentum is building and easing monetary conditions
point to more ahead. Weak euro should support earnings.
UK
The UK is Europe’s “emerging market,” given peaking economic cycle, deteriorating external balances
and rising political risk pre-election in early 2015.
Japan
BoJ remains “all in”. Equities are helped by continuing currency depreciation, rising earnings and
attractive valuations. Shifts in domestic asset allocation provide a boost to the Nikkei.
Pacific ex-Japan
Australian equities offer diversification benefits within DM and should benefit from continued
domestic monetary easing.
Emerging markets
EMs are vulnerable to exogenous shocks from falling JPY, rising U.S. rates and commodity prices.
Valuations are not low enough to compensate for the risk.
U.S. bonds short end
U.S. bonds long end
Yield curve flattener set to shift from bull to bear flatteners, as Fed approaches rate hikes in latter
half of 2015.
Euro, core
German Bund yields already look very low, but ECB QE should anchor them for an extended period.
Euro, periphery
Peripheral spreads over Bunds should compress further on the back of ECB bond buying.
UK bonds
Relative valuations look less attractive. BoE tightening now priced out until later in 2016, while UK
Gilts have yet to reflect growing political risks
Other DM bonds
JGBs unattractive even after the back-up in yield, but still supported by BoJ buying. Australian bonds
offer a nice real yield pickup.
Investment grade
IG valuations are more attractive with low default rates and balance sheet strength. Negative spread
correlation to yields offers protection if rates rise.
U.S. high yield
Attractive carry in a low-rate environment. Default rates should remain very low, but the asset class is
vulnerable to pockets of illiquidity.
Emerging markets
EM debt is vulnerable to higher USD and lower oil price despite pockets of macro stimulus and
reasonable sovereign debt dynamics.
USD
Growth and interest rate differentials in favour, but USD looking increasingly overvalued, suggesting
the “easy money” has been made.
EUR
ECB QE has led to another leg down in the euro. The euro now looks undervalued but weakness is
likely to continue for some time.
GBP
The pound is hurt by weak trends, the worst current account deficit in the G-10, and high political
risks not fully reflected in valuations or positioning.
JPY
QQE is still pushing the JPY weaker. It has already fallen a long way and is undervalued, but investors
shouldn’t fight the longer-run downtrend.
FX
Regional preferences by asset class
Equities
Main
asset
classes
D Negative
Max negative
KEY:
Long-dated bonds more attractive than they appear, and also offer portfolio diversification benefits.
Source: J.P. Morgan Asset Management GIM Solutions-GMAG, assessments are made using data and information up to April 16, 2015. For illustration purposes only.
Underlying economic views-in brief: Economic growth in developed markets is expected to continue, with the U.S. remaining the growth leader while Europe and Japan
narrow the growth gap, reliant on continued aggressive monetary stimulus. Meanwhile, growth in many emerging market (EM) economies is likely to remain challenged
by rising U.S. interest rates, a stronger U.S. dollar and low commodity prices.
8
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of any issuer discussed herein or act as underwriter, placement agent, advisor or lender to such issuer. The investments and strategies discussed herein may not be suitable
for all investors. The material is not intended to provide, and should not be relied on for, accounting, legal or tax advice, or investment recommenda­tions. Changes in rates of
exchange may have an adverse effect on the value, price or income of investments.
International investing involves a greater degree of risk and increased volatility. Changes in currency exchange rates and di erences in accounting and taxation policies outside
the U.S. can raise or lower returns. Also, some overseas markets may not be as politically and economically stable as the United States and other nations. The Fund’s investments
in emerging markets could lead to more volatility in the value of the Fund. As mentioned above, the normal risks of investing in foreign countries are heightened when investing
in emerging markets. In addition, the small size of securities markets and the low trading volume may lead to a lack of liquidity, which leads to increased volatility. Also, emerging
markets may not provide adequate legal protection for private or foreign investment or private property.
The opinions expressed in this report are those held by the authors at the time of going to print. The views expressed herein are not to be taken as advice or recom­mendations to
sell or buy shares. Our consensus estimates may di er from other publicly available sources due to our selection criteria. This material should not be relied on as including suffici t
information to support an investment decision.
J.P. Morgan Asset Management is the marketing name for the asset management businesses of JPMorgan Chase & Co. Those businesses include, but are not limited to, J.P. Morgan
Investment Management Inc., Security Capital Research & Management Incorporated and J.P. Morgan Alternative Asset Management, Inc.
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