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Seven money managers examine portfolio management strategies in the latest issue of The Wall Street Transcript, available at (212/952-7433) or http://www.twst.com/info/info505.htm

TWST: Do you have a hotel?

Mr. Andres: We do have a hotel. We actually own a couple. One in particular we own is MeriStar (NYSE:MHX). MHX trades at a significant discount to the REIT universe and to its hotel company peers. MHX’s valuation, along with all hotel companies, was severely impacted after September 11. In addition, it has temporarily suspended its dividend as business took a nosedive. We do expect MHX to resume their dividend later this year, and feel the dividend suspension was a very prudent financial decision by management. Also, we forecast business to start returning to normal as occupancy and room rates pick up. MHX has a lot of upside potential as these events unfold and investors get more comfortable with MHX’s business. Ultimately there is a lot of value in this stock. That being said, there’s still a lot of risk in this sector, so we’re not taking big bets. We have about a 5%-7% weight in hotels. MeriStar, which is our largest hotel position, is about 2.75%.

TWST: What is the dividend yield picture like going forward in 2002, and what events might impact that?

Mr. Andres: In our portfolio, our average dividend yield among all our securities is about 6%. For all REITs the weighted average dividend yield is about 7%. Our strategy is not to buy the highest yield, but to buy higher quality cash flow with growth. That, in turn, will result in better dividend growth and ultimately a higher yield at our cost. Many REITs are going to hold their dividend amounts flat year over year. There are, however, a handful of REITs we expect will raise their dividend this year. Given what’s going on in the current economic environment, that’s substantial.

TWST: When do you exit a REIT? What is your sell discipline?

Mr. Andres: For every company we invest in we set a price target. When everything goes right, that price target is our sell discipline. Another possibility is that better investment opportunities arise and we make a swap for a better risk-adjusted return. Unfortunately, we don’t always reach our price target or find a better investment. There are inevitably bad things that happen. The good news is that we continuously scrutinize our holdings to avoid or minimize these problems. Our fundamental process keeps us focused on criteria that would cause us to sell a stock. Such criteria include: declining asset yields, eroding quality of cash flow, questionable management strategy or decisions, and limited growth ability.

TWST: How do you differentiate yourself at Delaware from other companies that have REIT portfolios? What are your competitive differences?

Mr. Andres: We’re one of a few firms that have longer than a six-year track record. Because REITs are relatively new to the marketplace, we’ve been investing in them much longer than many of our peers. We have a very competitive track record placing us as one of the top performing managers over three and five years. Also, our product was born out of a large global investment firm that has a heritage in security analysis with a focus on cash flow. Delaware invests in several asset classes and styles. This puts our REIT investing in a global perspective and helps us analyze and understand our companies better. Many of our peers are solely REIT investors or real estate investors and have a limited perspective or expertise to analyze publicly traded companies. Finally, I think our process is unique.

This special Investing Strategies Report includes:

1) Investing in REITS - William K. Morrill, Jr. and Keith R. Pauley, both Managing Directors at LaSalle Investment Management, examine portfolio management strategies in this timely and deeply informative 6,800-word interview from The Wall Street Transcript.

2) Investing in REITS - Damon J. Andres, Vice President at Delaware Investments, examines portfolio management strategies in this timely and deeply informative 2,800-word interview from The Wall Street Transcript.

3) Investing in REITS - Kenneth T. Rosen, Chief Executive Officer and Michael A. Torres, President, both respectively at Lend Lease Rosen Real Estate Securities, examine portfolio management strategies in this timely and deeply informative 4,600-word interview from The Wall Street Transcript.

4) Kyle Prechtl Legg, President at Legg Mason Capital Management, examines portfolio management strategies in this timely and deeply informative 3,900-word interview from The Wall Street Transcript.

5) Richard D. Steinberg, President at Steinberg Global Asset Management, Ltd., examines portfolio management strategies in this timely and deeply informative 3,900-word interview from The Wall Street Transcript.