So obvious is the bedrock investment principle of risk diversification that a certain famous Elizabethan-age poet and playwright instinctively understood it. That principle provides the foundational basis for the careers of many of you.

An investment portfolio consisting of a mix of asset classes will outperform one that is limited to one or two. This much everyone knows.

And when should an investor optimally look to increase exposure to an asset class?

Again, the answer is obvious — when that asset class has undergone a downward adjustment in values that makes the cost of entry relatively cheap, creating an opportunity for attractive total returns going forward.

Today’s public equity markets have roared to historic heights at the same time that commercial real estate has experienced a meaningful devaluation. Thus, many institutional real estate investors’ portfolios fall short, in many cases substantially short, of their target allocations.