Investors Should Anticipate Downturn

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    Money will continue to flow into real estate from across the capital markets, but investors should be increasingly concerned about getting caught late in the cycle and should anticipate the next cyclical downturn in a few years, says LaSalle Investment Management’s ‘2015 Investment Strategy Annual (ISA).’ With different regions of the world growing at different speeds, investors need to prepare their portfolios for a world where interest rates begin to rise more quickly in some parts than others, the ISA found. To prepare for this, it suggests that investors diversify their holdings across a number of countries that are in different stages of the capital market cycle; anticipate different interest rate environments by allocating to real estate assets with income streams that keep pace with rising inflation or debt costs in growing economies like the UK or the U.S.; and invest in secular trends, rather than cyclical ones, that will be less exposed to a downturn.