Institutional investors

Real estate Increased complexity requires expertise   1971 1977 1984 1989 1993 1998 2004 2004-06 2005-06 2007 2011 1971 A pioneer in real estate as an institutional asset class 1977 Created first industry benchmark, Russell Property Index (now NCREIF Property Index) 1984 Launched our first private real estate fund of funds 1989 Launched US public REIT multi-manager fund 1993 Among the earliest to begin researching opportunistic real estate 1998 Advised major US public plan on industry-leading global expansion of opportunistic portfolio 2004 Awarded initial discretionary private mandate 2004 - 2006 Launched global REIT mandates 2005 - 2006 Expanded real estate staff coverage to London and Sydney 2007 Launched global private opportunistic fund of funds 2011 Real estate AUM of $7.8 billion (6/30/2011) Why choose Russell for your real estate investment needs? Flexible investment options We can provide you with investment products designed to fit your fund's diversification objectives and liquidity needs. For example, you can choose between our public or private real estate funds. Global experience in research and investment management We have been researching real estate managers for over 30 years and have offered multi-manager funds for over 25 years. Our real estate team is located in six different offices around the world and our analysis covers market trends, investment strategies, and public and private investment products. Recognized manager due diligence For a fourth year in a row, Russell was voted among the top in manager due diligence by participants in a 2012 FundFire survey of institutional sales professionals.¹ Access to real estate investment opportunities We regularly research the global universe of real estate products and can offer investors access to diverse investment opportunities. Why invest in real estate? Diversification Historically, real estate investments have had a low performance correlation with stocks and bonds. Because returns are driven by different factors than other asset classes, investing in real estate can also help investors diversify the risks in their portfolios. Return potential Over its history, real estate has provided investors with competitive returns relative to other asset classes. For example, in the 10 years ending June 30, 2011, the public real estate securities market returned 10.68%, compared to 3.21% from U.S. stocks and 5.74% from U.S. bonds. Real estate represented by the FTSE NAREIT Equity REITS Index, U.S. equity markets represented by the Russell 1000® Index and U.S. bonds represented by the Barclays Capital U.S. Aggregate Bond Index. Lower volatility than other asset classes From an investment perspective, the leasing and financing structures found in real estate investments are long term in nature and have historically contributed to relatively stable cash yields. Additionally, private real estate returns are largely dependent on periodic asset valuations and therefore do not exhibit the same level of volatility as returns from investments listed on exchanges. Related information Consulting 2010-2011 Russell Survey on Alternative Investing "Structuring a private real estate portfolio" by Leola Ross and John Mancuso "Structuring a listed real estate securities portfolio" by Dave Brunette and Leola Ross "Opportunistic private real estate: Capitalizing on cyclical recovery" by Ed Garcia We would welcome the opportunity to listen, learn about your objectives and discuss how the considerable resources at Russell can help your fund meet its goals.     West Coast David Rothenberg Managing Director 866-926-5934 East Coast Gerry Lillis Director 866-459-4128 ¹ Source: "Inst'l Sales Execs Praise Mercer, Russell, Callan", FundFire Survey for Institutional Sales Execs, February 2012. Russell Investment Group is a Washington, USA corporation, which operates through subsidiaries worldwide, including Russell Investments, and is a subsidiary of The Northwestern Mutual Life Insurance Company. Past performance is not a guarantee of future results. Please remember that all investments carry some level of risk, including the potential loss of principal invested. They do not typically grow at an even rate of return and may experience negative growth. As with any type of portfolio structuring, attempting to reduce risk and increase return could, at certain times, unintentionally reduce returns. Diversification and strategic asset allocation do not assure profit or protect against loss in declining markets. Specific sector investing such as real estate can be subject to different and greater risks than more diversified investments. Declines in the value of real estate, economic conditions, property taxes and tax laws and interest rates all present potential risks to real estate investments. USI-12691