that full information they would have voted for this process dealing with the proxy vote is not something we need to do and accident timeline didn't allow for it to be done so we hope in the future to count on the retirement system to vote on any and all resolutions related to disclose we're not having for a change of the business model here thank you very much. >> seeing none public comment is closed. >> one quick question how does this board formally communicate through i ss? >> i ss presents the full range of the preapproved policies and on an annual basis this body adopts the position generally speaking we can take them to

focus i mean we've had issues related to lending practices and we can get them focused in and have them recorded or report back to the issues related to the specific topic if you like had we can ask i ss to present the climate risk issues back to the board as a special report and give the board an opportunity to make it an action item to consider whether or not they want to change it to generally for or against a case by case or general instructions we can call them this afternoon and say if the board has taken action to direct us to through them to reexamine their position and take a forwarded step beyond what they normally recommend we could do that but since the

board approvals policy is a long document and sort of high-level descriptions of issues what the board has taken a position only over the years we'll change it and accomplish ex-what is suggested by the public comment and happy to bring the climate be risk issues of the subset of the issue to the committee for that matter. >> we think that is a very good suggestion we should be doing a better job of communication with i ss but a special report would be helpful so we don't miss opportunities like we did yesterday. >> thank you. >> thank you. >> well, what like i said they appeared before the board in the last few months with the full range of opportunities for the board to take an action or to

direct we'll be happy to ask them to bring back to subset of report and they said that will be an active season around the risk issues this will think within the realm of our contract agreement for a second action item the board can direct a different outcome for our proxy votes versus generally speaking. >> why not schedule that and we'll direct them specifically while their here and get a feeling for how it works. >> another idea do we know where beforehand what in their dealing with and . >> yes, they know the proxy i

don't know how far ahead they know. >> if you look at anticipation ann organization the proxy date is the proxy it was issued the second date the votes annual meeting and the spread between the dates is narrow as two weeks and might want months it various sybil pr so the reason i asked i want to make sure we're e-mailed ahead of time so we can inform ourselves and this body can deliberate in a meaningful way to direct our proxy how we want them to vote a missed opportunity. >> i'll take this opportunity to schedule a return visit in i ss to address the climate issues and our current policy states

i'd like as the president discretion calendar an ax so the board can take acts to you ss how they'll vote on proxies. >> contaminate can we ask them to actually present specific votes that will occur on some of the issues that we have here with the stop o stock and things in that category? so that we can at that meeting talk about that >> certainly at the time they present. >> if they can be more specific and we can talk about that. >> they can bring the actual resolutions coming up in the time period after the board meeting and tell how our current policy will vote on their behavior a determination whether

you want it to be voted directly. >> i have another question they vote against that time comic to preserve was it because of they're feeling of how combing works you know a combing issue or what is the issue. >> there's a couple of issues the scc rules that you'll note the phrase offerly perspire active when a management goes back to the scc if you significantly alternate the operations it doesn't make it to the proxy itself overly pro scripture your forcing their

hands simple items put it they did not and it is the methodology used by conco is fairly standard in terms of if i have a company that also doesn't v mp x exploration and production tied to a the level of oil prices is it profitable to do this activity you want to incentivize martin luther king to engage in activities that are the core of the business based on the prospective investments tying their hands at $64 is overly per scripture. >> thank you commissioner makras by you've answered my questions i was wanting to ask we voted open the level two therefore it was premature with

them coming back will satisfy satisfy they'll take the direction within the guidelines having met with them so he's correct in that. >> thank you. i wanted to just talk about level 2 divestment i'll call it constructive i know in the minutes it says divestment is not so we need a letter lead time as jed mentioned 3 were in the future 13 items but 3 in the future we have a bearing on we need a better lead time and number two it should be advanced so perhaps we can work with level 2 in constructive engagement with 9

fund maybe tweak it i mentioned before the rules have changed in terms of the power and the strength of fund that help this year and constitute a percentage 5 years and 5 percent yeah 5 years and 5 percent of the shares then it is a stronger position so that the spirit of level 2 for the social engagement i think we should number one give lead time before the votes are taken and two actively work with the pensions and that's the spirit of level 2 thank you. >> great. thank you very much for the presentation will you please call item number 9, 9. >> it's been continued until the june meeting

item number 9 action item approval to commitment neuro to item 6 sir. >> peter and tanya and gregg are on their ways up board members on page 1 when you look under the investment strategy it should read real estate there's a word missing under the investment strategies i'm going studio see if i can print something on the computer. >> art is on his way now would

you like us to wait it will be a minute. >> he needs to print something off so a two minute break. >> one. >> one. >> we'll just wait it won't be a two minute break so - >> i'll do a little bit of stand up

(laughter) please present to you a real estate investment with the norwayic partners i'm sure you're aware of there is a relative value in the real estate sector we've been trying to increase our x portion to europe to take advantage of the recovery and x portion for the black zone and portraits on a regional basis but want to take a more targeted approach to certain areas i'm sure you're aware of instead of being one home gins market the northern part of europe is different proposition and it is recovery devil from the regions of europe

we've identified in order as you recall we made a similar commitments on the private equality side to tvmg of the norway dick region the norway dick region has been growing steading for a number of key regions i think first and foremost they have a growing well educated and relatively wealthy population and vast natural resources at the their disposal as well is it so not the same strong recovery the us is showing but growing steadily there is interesting opportunity that type of investment has attracted a lot of capital from the regional and from black stone and the team has been you

know investing in the region for over 10 years and have developed a local and strong very proprietary network and in addition in their team has been together for a long time the senior merchandise have over 25 years of real estate experience that helps in terms of the franchise it leads to a track record that is a net of 60 percent refineries it is good and well positions to continue this type of performance we've worked with the nature of the company and with a meaningful commitment audience i'm going to keep my comments short and highlight a couple of things about the particular investment opportunity my name is is one thought is the leading real

estate investor in the noting region around 4 countries scheduling finland and norway and denmark their strategy is macro and bottoms up approach they predominantly choose investments in the cycles so in the memo in the anticipation you'll see that from fund to fund they have a different focus more have a particular country versus others funds organically where the best opportunity we like this mr. adams they've enter graded recycle other investors they usually allocate it to a local partner to execute the strategy

but my name is case whether they're given the straddling boots on the ground in the countries they operate this gives them an vandal in flying they can underwrite began last year debate into the deal particularly when they want to for sdiechlts to increase the size of a building are redevelop a site it gives them you know not in terms of the expertise in understanding the process overall this allows them to unlock value where other investors don't have the capability with that i'll pass it on to my colleague. >> sure he covered a lot a few things to add firm has a

expressive leadership the one ceo was there he was brought to transition my name is from a transitional buyer with a lot of third party's operators to operate their companies and transitioned the company into a platform that invests in real estate and due diligence and as of management operating the operations and then the dispositions also open is a ceo of stronghold group that is actually a parent of my name is he has been in the industry for the past 35 years and has a key roll in the

investment committee not involved day to day but my name is positions to capitalize on the local relationship and strong experience f in real estate in addition the team is quite strong most of the senior members have been with the firm for 10 years they've worked together at 'coz since a real estate development firm in the northern region the turnover has been limit only a few senior members have left owning over the past 10 years and finally the way they team is structured it is expected to benefit the funds because the way it is structured they have a separate investment team as well as acquisition team and asset management team i'd like to add on the

investment discipline of my name is they lead through the cycles demonstrated their ability to achieve the terms there cycles in 2007 and 2008 the bull market they focused on selling of the portfolio assets and that helped them to generate very, very attractive returns. >> just one last point building off that the returns are strong by hive realized fund 3 is 4r0ik9d with the approach fund and fund four has described more capital and fund 5 is 80 percent invested and generating a plus 9

percent. >> questions to the board 44 for this is page 9 your anticipation on the portfolio allocation i've noticed that over the property types at the bottom no residential until recently that is the green 26 percent residential in the my name is 4 is that the least risky the office versus the other types. >> that's the evaluations 90 no top down allocations or property they will invest in residential in rail probably a little bit less but driven by the evaluation therefore.

>> that make sense so, so they can take advantage of the investment opportunity as you available. >> that's correct this chart shows nothing set this next slide looks at different from a bottom-up. >> to open administrative with the capital o i want to talk about the interest hedging this is on the report beginning on page 9 those are fairly leveraged properties you're saying 80 percent debt. >> the l g t limit is pretty high then again those are pretty well stanltd properties and the system is sophisticated in the northern region with the track are record close relationships with the lender that is properly

leveraged not modesty so. >> it is create to performance the more leveraged they are obviously the income component is going to add value versus the interest expense so obviously that is successful when it the interest rates go down is that where the interest rate is hedging. >> hair investor operator for the most part but given this they've been getting advantageous terms terms and coveted and i want to add for the leverage ratio it looks kind of high at 75 percent they pay

principle every time they pay a debt service. >> that leads me to the next question what's the maturity of the loan round numbers. >> a lot of time it depended on how long the project in terms of the prikz of the loan i've been hearing pretty low rates and i don't want to give you a firm number. >> i'm not asking for that. >> hundred 20 to hundred 44 given in sweden. >> too much words one and a half percent the maturity 46 years. >> thank you very much. >> i would say that i've had a

lot of experience with in 2008 when a lot of the top fund companies were leveraged 75 percent they all had good relationships with the banks but the banks grossing froze it and wouldn't roll over the loans you saw them i don't think that it is a terrible thing to have in the portfolio as long as it is in modernization. >> they have the best relationships within themselves. >> lafco demonstrated it better in the engineering their portfolio than others we feel that my name is went through the same cycles through the 2004 they sold all the assets and 2007 fund a tough time to start

a fund they're doing well. >> i find the 2007 fund they still put in a lot of the money fast when you look at 2006 or you know or right around there that's when we put it in quicker or 2005 i just seen the worse of the worse so i've gone through each one as you said they were the bank and they couldn't even get the loan from the bank so long as we're not loading up what good many and the nordic system is- >> if you recall over the last couple of years we've emphasized managers that are 55 and 50 actual under that in many cases it is depending on the market we do take into account we get

comfort that my name is. >> my name is will recognize that how they've used the leverage in the most recent fund gone to the protection textbook d only the rate of 64 against an l t v covenant they don't put themselves in that sdajsz position. >> what's the maximum l t d. >> depending on the timing and evaluation they may not bring it to that limit currently it is at 64 and . >> and in 0 and 07 they were all

banks. >> that's right that's right. >> 4 and 07 they were all banks. >> that's right that's right. >> we're saying we want it in moderation where are we at when it comes to leverage at that size we'll determine if that is a moderate level to us. >> for the portfolio as a whole i think the sentiment is correct but until we know some type of leverage on the portfolio it sound good but no meaningful a. >> roughly our portfolio is 70 percent leverage but the investors have been modified in their approach that jumped out as pretty high but wow. given the long track record and the relationships with the bank they've gone more comfort to we

don't have a highly leveraged portfolio thinking of the evaluations but i'm sure you're aware of most of the new commitments have been will proposed that actually take other risks operating and development risks and less financial risks i guess this is one thing under did fund document is that helpful. >> yes. >> yes. >> i guess the optimum question do you make this investment with the leverage of '75 if the marketplace give us us 60 percent of leverage that's where i want to put our money your blending all the real estate together and the leverage is

half it is based on the leverage component which we're targeting 15 and in most everything the one highly leveraged is 7 by 7 that will reward us. >> it's been 7 by 7 percent i eyed 15 i wanted to give them something to beat it will be a challenge for them and us to meet those numbers our portfolio meets the 80 percent hurdle we're not getting 15 percent in the real estate investment you know some of the sectors and more inefficient market will have a chance to approach those levels anything on behalf of 15 percent is excellent this think an excellent opportunity with the leverage level. >> evaluations going in so it

didn't feel bad when you leveraged up something in 09 or 10 because things were cheap i know there's a lot of great real estate and there're a lot of distress i'm thinking what commissioner makras said we didn't have leverage in the portfolio we were low on leverage and in the highest quality that was good and bad not a lot of return so i think that is just value and leverage we have to be cognizant of. >> if the first deal is it more of an ad value investment and they want to put more leverage i'd hate to restrict them by be artificially saying