"Given that the real estate sector's investmentcharacteristics--current income combined with long-termappreciation--closely match SWF requirements," said Ray Torto,chief global economist at CBRE, in a statement. "We expect them toincrease their weighting of commercial property to approximately 7%of their total assets. With nearly $4 trillion of total assetscurrently under SWF control, a 7% allocation would mean worldwidecommercial real estate investments totaling $280 billion. To putthis number in context, the entire US institutional-grade propertyportfolio owned or managed by investment managers and plan sponsorsis valued at approximately $330 billion today."

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Estimates show that the SWFs could reach total assets of $12trillion by 2015, according to CBRE, which at 7% allocation impliesSWFs would make approximately $725 billion of net propertyinvestments over the next seven years. According to CBRE, thetarget allocations can be achieved if the SWFs diversify futureinvestments widely across geographies.

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"Although SWFs are likely to continue to focus on core realestate product in major markets," says Michael Haddock, directorEMEA research at CBRE, in a release, "they will have to put capitalto work in new geographies and emerging sectors."

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Haddock said that favored markets are expected to include Japanand the UK, along with "other countries with currencies that arenot held in the SWF's foreign reserves." According to the report,the break-down of the net investment distribution will be $40billion to $50 billion in direct real estate; $20 billion to $30billion in unlisted property funds; $5 billion to $10 billion inlisted property companies; and $20 billion to $25 billion indebt.

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"SWFs will have to look to both the indirect investment marketand the debt market to fully meet their objective in the realestate sector," Haddock continues, in the release. "It is also verypossible that we will see outright acquisitions of propertycompanies--listed and unlisted--as a way of assembling asignificant direct real estate portfolio rapidly, as well asacquiring the property management infrastructure to go withit."

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Opportunity could abound for multiple countries looking to landinvestment. The BRIC countries--Brazil, Russia, Indiaand China--are still foremost in investors'minds, despite some market trepidation and obstacles todeal-making.

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