Confronted by debt, deficit and demographic challenges, the U.S. economy is facing significant headwinds. The recent report of no new jobs gained nationally in the month of August provided yet another reminder that the economic recovery from the 2007–2008 recession, already the most prolonged since 1950, is likely to continue to be a long, slow ride. GDP growth forecasts have fallen to roughly half the pace of prior recoveries, but more troubling is the very slow pace of job growth.

So what investment strategies work in an economy likely to experience such slow job growth — growth that is clearly so critical to driving demand for virtually all types of real estate? Largely due to the very slow pace of recovery, new supply is not much of a concern in any property type, so key to forecasting absorption and ultimately rent growth is to identify areas where demand for space is likely to be strongest.

One approach is to go defensive and focus on traditional areas of emp