Really the disruption caused by the pandemic, particularly in commercial property, really peaked about the fourth quarter of last year.  And what I’m referring to there is really disruptions to hotels, shopping centers, regional malls, things like that.  If you look at delinquency rates in the CMBS space, they all peaked for those property sectors, they peaked in the fourth quarter and have been moving down steadily since then. For the most part, if you’re a hotel or a shopping center, you’ve made it this far, you’re probably likely going to make it all the way -- can’t see something that’s going to disrupt things so much.  But the reopening trade has already started happening there.  You see it first, of course, in the listed market.  The REIT market capital pivoting back into those sectors that were most dislocated. And now it’s happening in the private part of the market as well, capital’s starting to move back into shopping centers.  They’ll start with really grocery-anchored centers first.  But it’ll move more broadly from there.  The big wild card, and I’m sure we’ll get into this a little bit later, is going to be how tenants use office space.  How much they use it, how often they use it.  Whether they’re going to have to reduce their footprints.  They’re going to want different kinds of office space.  And that’s something the market is still very much uncertain about and still in exploratory phase, I would say.

Could We See Converting Office Buildings Into Apartments?

Yes, there’s a lot of people talking about that.  In practice, it’s very difficult to do. You need local government to be very supportive for the rezoning and all of that.  Plus there’s an awful lot of physical reconfiguration that has to be done.  And particularly, you have to put bathrooms in, right?  And it’s a lot of replumbing and a lot of rework.  But it’s been done before.  Particularly in New York, it’s been done before.  It could get done again.  In an awful lot of cases, what turns out to happen is it turns out to be more financially-viable to tear down the building you’re talking about and rebuild at that location, and I imagine there’ll be quite a bit of it.  Virtually every city in America has a housing crisis, right?  There’s not enough affordable housing anywhere in any city in the country.  You go to talk to them, that’s their number one probably, probably one, two, and three, actually.  And we’re very active in that what we call essential housing, but it’s the rental housing that’s affordable to somebody below median income.

Will Real Estate Underperform Or Outperform?

-- commercial real estate in the US, certainly, but globally, is not a monolithic thing.  There’s all kinds of commercial property that, not only was it not disrupted at all by the pandemic, it actually thrived.  Things like life sciences, cold storage, data centers.  Just broad industrial logistics distribution space.  The demand for that type of property has never been stronger.  It was a trend that was happening before. Delivering things directly to final demand was displacing in-store order fulfillment, you know, people actually going to a store and picking things up.  And the pandemic obviously accelerated an awful lot of that. So there’s huge swaths of our commercial real estate market that are having their best performing years really ever.  Vacancy rates for industrial space in the United States have never been lower.  Rent growth in industrial -- all kinds of industrial is double digits in most markets this year.  Apartments, the same way.  Housing prices in the United States, on average, went up about 15 percent in the past year.  That was great for homeowners, I suppose.  What it did do is it create a whole group of people that couldn’t move into home ownership and they’re renting instead, and across the country, there’s many many markets where rent growth year over year is 10 percent or more.  So there’s huge pieces of this market that are really thriving, and will continue to thrive.  But again, there’s places where there’s a lot of uncertainty, and I think office particularly, the traditional glass tower office is probably the one where there’s the most uncertainty right now.

What Areas Are Gaining Popularity Among Investors?

I’d say in the past couple of years where there’s been the most interest I think is this area where infrastructure and real estate sort of butt up to each other.  That can happen in a lot of different places.  Like, for example, in the public REIT market today, the largest part of that market is cell towers.  And cell towers, I think most people think cell towers are infrastructure, I think.  But they’re traded in the REIT market. And they’re the largest piece.  Within property sectors in the U.S., I mentioned earlier, cold storage, refrigerated, temperature-controlled stored.  Last year, in December, Homeland Security issued an advisory declaring that portion of the logistics market to be critical national infrastructure, because our food goes through it, and your food, increasingly people are eating more fresh food, less frozen food, less preserved food, and that means the food needs to be temperature-controlled, and it has to turn over faster in the whole system.

Is Real Estate An Attractive Alternative For Income-Seeking Investors?

I think the single biggest issue, if you will, for our investors, is the bond market is telling us we should be expecting negative real yields for another decade.  And if you’re a pension fund trying to make your returns, negative real yields are a real bear, and it’s forcing them to make a lot of choices, including going into alternatives, and commercial property, because ‑‑ I’ll just speak just for commercial real estate, we’re starting at a point where our expected real yield going forward is positive, not negative.  And it’s a yield that’s going to grow.  It’s going to grow in step with the leasing, with the rents.  The net operating income of the properties.  And it’s very very visible to those investors and they feel like they can really underwrite it.