According to the Association of Foreign Investors in RealEstate, foreign investors view the US as the strongest and safestlocation for international commercial real estate acquisitions. Ina survey released earlier this year, 74% of participants, comparedto 60.7% in 2005, report that the US offers the most secureenvironment for investment.

Deals completed by foreign investors "attract a lot ofattention," said Mark Meier, director, Mitsui Fudosan America Inc.He expects there will be increasing amounts of Japanese capitalgoing toward real estate due to such factors as the increasingJapanese economy, the interest in real estate, lack of domesticsupply and legislative changes here. "There is no reason to expectinvestments will subside in the future."

"Investors are looking for off-market deals," noted ScottLatham, executive director, Cushman & Wakefield New YorkCapital Markets Group. "Private capital will continue to dominate."He said part of the reason investors find the city so attractive isbecause "the fundamentals are very strong and the vacancy ratelow." He anticipates competition will remain as there is so muchcapital for the supply of suitable product.