Question-and-Answer Session
Operator
Thank you. (Operator instructions) Your first question is coming from Mike Carrier of UBS.
Mike Carrier – UBS
Thank, hi guys. A question on the alternative opportunity, just given some of the recent hires and that it's a 2009 later opportunity. But when you guys used to talk about the international opportunity for real estate, you used to be able to kind of size the marketplace there. So, if you look at the alternative space, do you have any idea of what the target market is both in terms of asset size and then what distribution channels are you seeing the demand for it, and then what the fee structures would be on any of these products?
Matt Stadler
Well, with respect to the market sizes, certainly we believe that the fund of funds – real estate fund of funds opportunity is a global opportunity, it is an institutional opportunity, and it is a retail opportunity. The opportunity goes beyond just fund of funds. I think the opportunity is to deliver both listed and unlisted real estate on a global basis in a sophisticated fashion to institutions and to individual investors. So, we think looking out five years – three to five years, the size of the opportunity for us can be anywhere from $3 billion to a lot more than $3 billion. We think it's already a significant market, but it's growing very rapidly and it could be quite large.
With respect to the hedge strategy opportunity, I don't think it's as big a market, but it's an exciting market. It's a great investment opportunity and you probably have as good an idea of what the fee structures are there as we do.
Mike Carrier – UBS
Okay. And then, Matt, you were mentioning through the quarter and then thus far in April that you have seen a deceleration in some of the outflows. It seems like just with REIT markets up for the year, you see some stabilization in the net flow numbers. I'm just curious, either Marty or Bob, if you're looking out over the next year or two and you look at past cycles, you got to have on one side higher inflation, which typically you want to own real estate in that environment. And then on the other side, you have the economic issues and some real estate issues. So, which forces do you see as having more weight in this environment and kind of how – what do you see the outlook for the real estate opportunities going forward?
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