LIQUIDITY AND THE 2010 COMMERCIAL REAL ESTATE MARKET:

Connecting the Dots with Today’s Global Capital Flow

ROBERT J. NAHIGIAN, FRICS, SIOR, CREROBERT J. NAHIGIAN, FRICS, SIOR, CRE October 30, 2009October 30, 2009AUBURNDALE REALTY CO.AUBURNDALE REALTY CO. TorontoTorontoNEWTON (Boston), MASS.NEWTON (Boston), MASS.

PREDICTION DISCLAIMERS

1. GOVERNMENT INTERVENTION

2. INFLATION

3. CHAOS

OTHER DISCLAIMERSThe information presented reflects the personal opinions of Robert J. Nahigian based on sources and data believed to be reliable but he does not guarantee its accuracy or completeness. This information is for private use and educational purposes only and neither the author, the sponsor nor the instructor are providing advice, legal or otherwise and such advise should be dependent on the facts and circumstances of any particular situation. There is no obligation to update or supplement this information at any time or in any way.

Robert J. Nahigian is not a registered investment advisor and as a further full disclaimer he does sit on the Advisory Committee of NERA, an American Stock Exchange Boston real estate investment entity in the business of purchasing and selling commercial properties. He is in no way recommending the purchase or disposition of any specific stock of any kind at any time.

The material presented may be inaccurate or may be improper for any business decision and some examples in this presentation are good examples of practices that would be better to avoid.

CCIM Chicago: Jan. ‘08• LET’S LOOK BACK TO THAT

PRESENTATION: Where were we?

• CAN WE CONNECT THE DOTS MOVING FORWARD?

U.S. CBD INVESTMENTS: Jan. ‘08

• One Word: Hot and more Hot !

• Values were up in 2006

• Values continued to rise in 2007

LAST 2 YEARS: ’06-’07LAST 2 YEARS: ’06-’07

• It has been all about capital !

• You couldn’t fail with real estate investments

• A lot of money chasing deals and “yields”

Next 2 Years: ’08-’09Next 2 Years: ’08-’09

Success based more local (micro) Success based more local (micro) rather than national (macro) rather than national (macro) environment environment

Difficult to find a balanced value Difficult to find a balanced value commercial investment in the US commercial investment in the US

People think buying now will be cheaper People think buying now will be cheaper than tomorrow than tomorrow

Next 2 Years:’08-09Next 2 Years:’08-09

2007 everyone was a “genius” so 2007 everyone was a “genius” so demand for real estate was amplified demand for real estate was amplified

In 2008, investors will need to look at real estate with In 2008, investors will need to look at real estate with true due diligence evaluation true due diligence evaluation

We need to get back to “old-fashion” growth and focus We need to get back to “old-fashion” growth and focus on NOI on NOI

• CAP RATES could increase 100 BP by the CAP RATES could increase 100 BP by the end of 2008 end of 2008

Jan. ’08 PROJECTION FOR ’08-’09Jan. ’08 PROJECTION FOR ’08-’09

• The “Idiot Tax” will vanish in 2008The “Idiot Tax” will vanish in 2008

• Liquidity is immense but not stupidLiquidity is immense but not stupid

• Foreigners have an appetite but could pull Foreigners have an appetite but could pull the plug at any time the plug at any time

Oct. 30, 2009: 2010 CONCLUSION

• U.S. companies have run down inventory

• Re-stocking is up and so is manufacturing

• March 9, 2009: Stocks hit bottom

• June, 2009: Housing hits near bottom

• Commercial loan defaults will damage banks in ’10-’11

• Now it’s time for commercial, lagging

Oct. 30, 2009: 2010 CONCLUSION

• The Feds are forcing everyone to swallow more risk and invest

• Money Market interest rates are worthless! “Curse on Cash”

• Be Ready to Buy in ’10-’11 or keep holding: It may be a life-time opportunity

• Rents means dividends !

Oct. 30, 2009:TROJAN HORSE

• U.S. is leaving GAAP for IFRS in 2011 or 2014. Watch out! Be ready to “Rock and Roll”!

• FASB 13: More parts are now capitalized; no more rents as operating lease expense

• Companies may pursue purchasing

REAL ESTATE CYCLESSECTORAL

PEAK U.S 7-10 yrs. PEAK Hyper-supply

Hyper-supply

“DENIAL PHASE”BID-ASK SPREADS

Expansion Recovery “Yield Chasers”

Commercial 4th/5th Inning

Recession Early Recovery

BOTTOM

Residential BUY LOW/SELL HIGH

THE FEDS INFLUENCE ON COMMERCIAL

U.S. UNEMPLOYMENT RATESeasonally Adjusted

Source: Bureau of Labor Stats, CBO

7.60

9.509.40 9.70 9.80 10.20

5.80

4.60

0

2

4

6

8

10

12

'07

Yr.

'08

Yr.

Jan.

'09

June

'09

July

'09

Aug

. 30,

200

9

Sep

t. '0

9

2010

Pro

j.

Millions

Jobs = Space Demand

U.S. Average Percent Change in Jobs Per Decade

38%

25%

31%28%

20% 20%

0%0%

5%

10%

15%

20%

25%

30%

35%

40%

1940's 1950's 1960's 1970's 1980's 1990's 2000's

Percent Change Resource: Doug Poutasse

Federal Total Revenues and Outlays as Percent of GDPSource: CBO

19.5%23%

18.5% 17.5% 21%

26%

0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

30.0%

1969 1982 1999 2000 2008 2009est.

of GDP

Highest

U.S. FEDERAL BUDGETSource: WSJ

-4

-3.5

-3

-2.5

-2

-1.5

-1

-0.5

0

0.5

F'80 F'93 F'00 F'08 F'09 F'10

In Trillions

U.S. FEDERAL DEFICIT v. GDPSource: CBO

-12

-10

-8

-6

-4

-2

0

2

4

1965 1977 1992 1998 2002 2004 2008 2009est.

2019proj.

Percent

INFLATION?

U.S. PERSONAL SAVINGS RATESource: Federal Reserve

6.9%

0%2%4%6%8%

10%12%14%16%

Jan. '

5919

6119

69

Sept.

'75 1975

1985

1993

Jan. '

9820

0220

05

Aug.'08

Dec.'0

8

April '0

9

May

'09

Discretionary Savings

U.S. TOTAL CONSUMER CREDITDEMAND

Source: Federal Reserve In Billions (Trillions)

2191.5

2519.52559.1

2509 2493.7 2474.7

2462.7

2000.0

2100.0

2200.0

2300.0

2400.0

2500.0

2600.0

Deleveraging

CONCLUSION

• It’s all about jobs for commercial real estate!

• Deficit grows, income is down and people aren’t spending

• Look for inflation within 24 months. Bernanke admits interest rates might rise (week of Oct. 10, 2009)

U.S. HOUSING AS AN INVESTMENT LEADS TO THE

COMMERCIAL DEBT CRISIS

WHAT IS PRICE v. VALUE?

• PRICE IS WHAT YOU PAY

• VALUE IS WHAT YOU GET

Source: Ben Graham

U.S. EXISTING ALL HOMES FOR SALE

Source: NAR; Standard & Poors Homes on

marketMonths Est. to sell

Annualized Purchases of all Homes

Median Price of SFDU

Jan. ‘05 2.15 M 3.6 7.08 M $195,400

Nov. ‘06 3.81 M 7.3 6.25 M $217,300

April’07 4.22 M 8.4 6.01 M $219,800

July ‘07 4.56 M 9.1 5.73 M $228,700

Nov. ‘07 4.27 M 10.3 5.00 M $210,200

Feb. ‘08 5.09 M $195,900

Oct. ‘08 4.23 M 10.2 5.05 M $183,000

April ‘09 10.1 4.68 M $ 166,600

June ‘09 3.8 M 9.4 4.89 M $ 181,800

July ‘09 3.3 M 8.5 5.24 M $ 181,700

Aug ‘09 3.87 M 8.2 5.1 M $ 177,300

Sept. ‘09 3.63 M 7.8 5.57 M $ 174,900

U.S. NEW HOMES FOR SALE

Source: NAR WashPost US Commerce; HUD; MSNBC; Standard&Poors

Tot. New Homes on market

Months Est. to sell

New Home Sales

Median Price

Nov. ‘06 545,000 6.5 987,000 $251,700

April’07 547,000 7.4 907,000 $229,100

Nov. ‘07 505,000 9.3 647,000 $239,100

Feb. ‘08 471,000 9.8 590,000 $244,100

Oct. ‘08 791,000 11.4 $ 220,000

April ‘09 10+ 352,000 $ 209,700

June ‘09 8.4 426,000 $ 212,600

Aug. ‘09 262,000 7.3 429,000 $ 195,200

U.S. HOMES UNDER CONSTRUCTION

Source: MSNBC 9/17/09; Standard & Poors, Dept. of Commerce

SFDU and Apts

SFDU construction

Applications for all residential building permits

Sept. ‘08 806,000

June ‘09 590,000 478,000 570,000

July ‘09 581,000 494,000 560,000

Aug. ‘09 587,000 482,000 580,000

Sept. ‘09 590,000 501,000 573,000

Working off inventory

U.S. HOME LOAN DELINQUENCIESSource: MSNBC; Real Estate Forum Dec. ’07; Standard&Poors; WSJ

All Home Mortgages

ARM: Sub-Prime

Late

2nd Q ‘07 5.12%

Aug. ‘07

Sept ‘07

3rd Q ‘07 5.59 18.8%

4th Q ‘07 5.82% 20.2%

3rd Q ’08 6.41% 18.67%

April ‘09 12%

1Q ‘09 9.12% 24.95%

2Q ‘09 9.24% 25.35%

U.S. MORTGAGE FORECLOSURES

Source: MSNBC 12/6/07; 3/19/08; Standard&Poors All Mortgages Sub-Prime

ARMs

2Q ‘07 0.65% 3.84%

3Q ‘07 0.78% 4.72%

4Q ‘07 5.29%

1Q ‘09 1.34% 4.55%

2Q’09 1.47% 4.49%

NEXT HOUSING FORECLOSURE WAVE

0

10

20

30

40

50

60

2007 2008 2009 2010 2011

In Thousands Resource: MSNBC

COMMERCIAL REAL ESTATE: Where We Have Been and Where We Are Headed

SEPTEMBER 30, 2009: WSJ

COMMERCIAL BANKS WITH RE DELINQUENCIESSource: Federal Reserve Bank

2.75%

5.47%

6.93% 7.67%

0.00%

1.00%

2.00%

3.00%

4.00%

5.00%

6.00%

7.00%

8.00%

4Q '07 4Q'08 1Q'09 2Q'09

3000

4100

5200

0

1000

2000

3000

4000

5000

6000

Office Multi-Family Retail

Dec.'08 June '08 May '09 Source: CPN 9/09 In millions

COMMERCIAL RE DELINQUENCIES:May ‘09

SECURITIZED COMMERCIAL LOAN DELINQUENCIES

Source: WSJ 3/26/09; Deutsche Bank

0.0%1.0%2.0%3.0%4.0%5.0%6.0%7.0%8.0%9.0%

Delinq. Rate

U.S. COMMERCIAL MORTGAGE DEFAULTS

Source: Cohen Steers

2.5%4.0%

6.6%

0.50% 0.75%

2.3%

11%

0

0.02

0.04

0.06

0.08

0.1

0.12

1988 1990 1992 1998 2001 1Q'09

2010est.

Loans Defaults

CMBS ISSUANCESOURCE: Commercial Mortgage Alert; CMSA

$16$37

$58 $49$74

$52$78

$93

$169

$206

$12.1

$230

$0.6$0

$50

$100

$150

$200

$250

Loan Amount In Billions

TOTAL U.S. INVESTMENT SALESSource: Deutsche Bank, Real Capital Analytics

$0

$20

$40

$60

$80

$100

$120

$140

Sales In Billions

?

Real Estate Value Change: 2009

NOI - 15%

Cap Rates 5.5% increased to 7% or more

Results 38% decline in commercial value is greater than building value

U.S. AVERAGE COMMERCIAL RE MORTGAGES MATURING

$460

$480

$500

$520

$540

$560

$580

$600

Loan Amount in Billions Reference: America's RE 2009

COMMERCIAL RE DEBT MATURITIES (INCLUDING SECURED AND UNSECURED DEBT)

Source: Chip Rodgers, RER

$0$200$400$600$800

$1,000$1,200$1,400$1,600$1,800$2,000

Loan Amount in Billions

30% won’t qualify for refi

U.S. COMMERCIAL MORTGAGE MATURIES: Life Ins., CMBS, CDO, ABS, GSE, and Other

CreditSource: AEW, CRE Fall Convention ‘09

$0

$20

$40

$60

$80

$100

$120

$140

$160

$180

$200

Loan Amount in Billions

COMMERCIAL BANKS IN TROUBLE:Commercial and Multi-Family Debt

Source: CRE Fall Convention ‘09

$0$500

$1,000$1,500$2,000$2,500$3,000$3,500$4,000

Total Com./M

F Debt

2Q'08

2Q'09

Debt in Billions

45% with commercial banks

Percent Change in Construction Starts

Source: CPN July ‘09

44

55

1511

40

14

5

52

0

10

20

30

40

50

60

Office Retail Industrial Hotel

March '08 March '09

Apartment Development Activity: 4 Sample National Companies

Source: David Gleeson, CRE

2007 2008 2009 2010

A 10,000 u 8,000 0 0

B 2,227 1,035 0 0

C 1,130 1,251 0 0

D 1,653 0 0 0

FUTURE COMMERCIAL MORTGAGE DELINQUENCIES

Source: Deutsche Bank

• Loans are maturing from 5 years ago

• New Appraisals are 30- 40% lower

• Lack of Owner Equity Available: Partners are saying “Enough is enough” • Delinquency rate for partial IO loans are twice that of other loans

• Over $ 2 Trillion commercial mortgages will mature by 2013 and 33% will not qualify for refinancing

FUTURE COMMERCIAL MORTGAGE DELINQUENCIES

• MF construction permits will most likely end at 2009

• Over 1,000 commercial banks fail in the next 24 months

• Would you be in a rush to buy if waiting was worth a big discount?

• Bottom feeders will wait 2 years to the bank collapse

• Look for 2010-11 for deeper commercial foreclosures

REAL ESTATE YIELD BREAK-DOWN V. THE DOW

OCTOBER 13, 2008

U.S. PERSONAL SAVINGS RATESource: Federal Reserve

8%

6.9%

0%2%4%6%8%

10%12%14%16%

Jan. '

5919

6119

69

Sept.

'75 1975

1985

1993

Jan. '

9820

0220

05

Aug.'08

Dec.'0

8

April '0

9

May

'09

MONEY MARKET CASH-ON-HANDSource: WSJ

3.37

3.43

3.53

3.90

3.39

1.90

4.40

3.48

3.09

2.81

2.43

2.27

2.16

3.77

3.66

00.5

11.5

22.5

33.5

44.5

5Trillions

DOW HISTORY

0

2000

4000

6000

8000

10000

12000

14000

16000

May

26,

189

6

Nov

.14,

1972

Dec

. 6, 1

974

Nov

.21,

1995

Mar

ch 2

9, 1

999

May

3, 1

999

Jan.

14,

200

0

Mar

ch 7

, 200

0

Oct

. 9, 2

002

Oct

. 19,

2006

June

12,

200

7

July

1, 2

007

July

11,

200

7

July

19,

200

7

Aug

. 16,

200

7

Sept

. 24,

200

7

Oct

. 1, 2

007

Nov

. 26,

200

7

Jan.

1, 2

008

Oct

. 9, 2

008

Apr

il 1,

200

9

Sept

. 30,

200

9

Oct

. 23,

200

9

U.S. GDP v. DOW HISTORY: In Trillions $

14,285

10,128

$1,038

10,081

8,5048,776

1,003

10,007

$0

$2,000

$4,000

$6,000

$8,000

$10,000

$12,000

$14,000

$16,000

1970 2001 2006 July, 2007 Dec. 31, 2008 July 2, 2009 Oct. 23, 2009

US GDP Dow Source: Williamson/Johnston Bureau of Econ. Analysis

INVESTMENT RETURNS: 1998-2009Source: Morningstar, NCREIF,WSJ, YahooFinance 10 YR.

Aver.2008 1Q ’09 2Q ‘09 9/30/09

YTD

NCREIF R.E. 12.34 -6.46 -7.33% -5.2% -7.4 % 3Q

ALL RE MUTUAL FUNDS

-3.82% NA

REITS 14.89%

S&P 500 -1.4 -37 -11 3.2 17%

NYSE COMPOSITE -1.98% -40.75% 20%

DOW 1.1% -33.84% 11%

NASDAQ -2.81% -6.5% 34.6%

MONEY MARKET FUNDS

0.05%

CONCLUSION

• Market is very liquid

• Feds will push investors to take risk

• Returns are up showing faith in the market

• But are we being fooled for another bubble?

COMMERCIAL RE EQUITY/DEBT FINANCING/RETURNS

U.S. 10-YR. T-NOTE: ’62-’09Source: Federal Reserve

3.212.22

3.553.59

3.654.034.31

5.19

4.804.29

6.036.57

8.55

10.6211.43

7.99

7.35

3.95

0.002.004.006.008.00

10.0012.0014.00

1962

1970

1975

1980

1985

1990

1995

2000

2005

2006

Ju

ly,2

007

Nov

. 2, 2

007

Jan.

1, 2

008

Apr

il 2,

200

8O

ct. 8

, 200

8Ja

n. 2

, 200

9Ju

ly 2

, 200

9O

ct. 2

, 200

9

AnnualYield

NCREIF v. OTHER REAL ESTATESource: WSJ, YahooFinance, NCREIF 2008 2Q ‘09 2Q-3Q

‘09

9/30/09

YTD

NCREIF R.E. -6.46 -5.2% -9.03% -7.4% 3Q

ING EUROPE RE FUNDS

(best single internatl. RE fund return ’08)

-43.1% 43.87%

GENERAL RE MUTUAL FUNDS

-42.19%

INDUSTRIAL & OFFICE REITS

39.2%

MONEY MARKET FUNDS

0.05%

U.S. 10-YR T-Note Yields vs. Real Estate Yields: ’04-08’

Source: Federal Reserve

4.27 4.294.80 4.65

5.04 5.19

4.314.03

10.410.1

9.5

6.5

0

2

4

6

8

10

12

2004 2005 2006 April 1, 2007 2Q '07 July 9, 2007 Nov. 2, 2007 Jan. 1, 2008

T-Notes RE Returns

U.S. RE 4Q 2008 PRE-TAX YIELDSource: RERC

8.00%8.50%

9.00%

9.50%10.00%

10.50%

11.00%

US

U.S. 10-YR T-Note Yields vs. Real Estate Yields: ‘09

Source: Federal Reserve

5.04 5.19

6.5

5.54.31

4.033.2

6

9.5

0

1

2

3

4

5

6

7

8

9

10

2Q '07 July 9, 2007 Nov. 2, 2007 Jan. 1, 2008 3Q'09

T-Notes RE Yields Unlev.

U.S. CAP RATES: Going-In Cap 2Q ‘09Source: CPN April ’09/WSJ 5/6/09/RERC 2ndQ’09

8.18.48.48.17.6

0.01.02.03.04.05.06.07.08.09.0

4Q'08 1Q '09 2Q'09

U.S. 3Q’09 INVESTMENT SALES OVER 2Q’09Source: Real Estate Analystics

-60%

-40%

-20%

0%

20%

40%

60%

80%

100%Percent of increase jumped in 3Q

U.S. 3Q’09 INVESTMENT SALES OVER 2Q’09Source: GlobeSt.com

$0

$2

$4

$6

$8

$10

$12

$14

In Billions

Dollar of deals is up for all sectors!

Interest Rate Spreads:’05-’09 Com. Mortgage vs. 10 Yr. T-Note

Source: ING Clarion, ULI

5.5 5.505.9

6.8

7.58.0 8.0

4.2

5 4.8

3.8

2.9

3.553.21

0

1

2

3

4

5

6

7

8

9

2005 2006 2007 2008 1Q'09 2Q '09 3Q'09

Aver. Com. Mortgage Rate 10 Yr. Treasury

Lowest Interest Rate

Range 7-8%

7.25% (amortized)

5.5 % (I.O. short-term)

Recourse LTV 50% Good supply

60-70% Minimal

1.25-1.50 DCR

Loan Amount Easy: $5-10 million

Loan Amount Difficult: Over $10 million

Investor Demand 10.25% (300 BP)

COMMERCIAL RE INTEREST RATES 3Q, 2009Source: Colliers Meredith&Grew Capital Report, Fantini&Gorga

Oct. 22, 2009: House mortgages

increase over 5%

COMMERCIAL BANKS: PERCENT OF RISK BASED CAPITALTHE TROJAN HORSE

Source: Federal Reserve Call Reports

300%

50%

150%170%

200%

50%

105%

0%

50%

100%

150%

200%

250%

300%

350%

CONCLUSION

• Expect over 1000 banks to fail in the next 24 months

• Return rates are climbing

• Bigger spreads between “ask” and “bid” prices

• Therefore stalemate continues while the clock is ticking on loans

THE INTERNATIONAL INFLUENCE

EURO DOLLAR VALUE

0

0.2

0.4

0.6

0.8

1

1.2

1.4

1.6

1.8

US $ Val.

Weak Dollar

Better value

1.48%

0.53%

1%

0.50%2.25%

3% 3.25%

0.00%

1.00%

2.00%

3.00%

4.00%

5.00%

6.00%

7.00%

8.00%

JapanSwiss

Euro Zone

BritainCanada

Australia

U.S.

Jan. 2, 2008 April 2, 2008 Oct. 1, 2009 Source: WSJ

COST OF BORROWING: PRIME RATE: Jan. 2, 2008-Oct. 1, 2009

With inflation, cost is zero

Global Real Estate PurchasesLIQUIDITY AND REAL ESTATE

Source: AFIRE, BEA, RE Capital Analystics

$354 $393$495

$682 $700 $704

$220

$989

$0

$200

$400

$600

$800

$1,000

$1,200

2003

2004

2005

2006

2007

2008

3Q'0

9

2009

Est

.

In Billions

BUY LOW

Foreign Investments of U.S. Commercial Real Estate

Source: Chip Rodgers, RER; GlobeSt.com

$0$5

$10$15$20

$25$30

$35$40

2003

2004

2005

2006

2007

2008

2009

Est

.

In Billions

Where is the money going? China accounted for half in 3Q’09

FOREIGN DIRECT HOLDINGS OF U.S. COMMERCIAL PROPERTIES

Source: US Dept. of Commerce

$177.4$169.7

$178 $187 $190.7 $190

$242$227.9

$0.0

$50.0

$100.0

$150.0

$200.0

$250.0

2001 2002 2003 2004 2005 2006 2007 2008

Holdings In Billions

1. SWITZERLAND (OVERTOOK U.S.)

2. UNITED STATES

3. SINGAPORE

4. SWEDEN

5. DENMARK

6. FINLAND

7. GERMANY

8. JAPAN

9. CANADA

10. NETHERLANDSSource: Business Week 9/21/09Com

FOREIGN RATINGS OF COMPETITIVE COUNTRIES TO INVEST: 2009

-4-202468

101214

Jan. '0

7

Dec.'0

7

July

'08

Sept.0

8

Dec. '

08

Mar

ch '0

9

July

'09

Aug. '09

Sept.'

09

Indonesia S. Korea India

ASIAN INFLATION STRIKESSource: WSJ

Oct. 6: Australia ups interest rate

2009-2010 CONCLUSION• Repeal or revise FIRPTA

• There is ample investor liquidity but not chasing deals

• Price has not equaled value

• Commercial real estate is headed for more distressed news! That’s Good !

• Banks are gearing up for the worst

2009-2010 CONCLUSION

• Appraisals are low and banks haven’t yet readjusted mortgage book values

• Loan-to-Values are resetting with equity calls

• The worst is yet to come with expiring commercial mortgages in ’10-’11

2009-2010 CONCLUSION

• Vulture Investors are betting on distressed real estate for 2010. Over $ 40 B has been raised

• REITs have raised $23.3 B in equity for purchases

• It will be more like heaven in 2011!

2010 CONCLUSION

• Deflation or Inflation? Shilling says Chronic Deflation is here to stay due to deficient demand, not excess supply

• Real Estate is an Inflation-Hedge

• Deleveraging continues: Deferring new purchases

• Buy Apts, hold cash

• Be PATIENT to buy!!!!

2010 CONCLUSION

• GAAP to IFRS could spur commercial purchases

• Watch out for the “Minsky Rage” !

HAPPINESS DEFINED:

EXPECTATION = REALITY EXPECTATION = REALITY

OROR

REALITY IS GREATER THAN REALITY IS GREATER THAN EXPECTATION EXPECTATION

THANK YOU !SIOR

ROB NAHIGIAN, FRICS, SIOR, CRE