Ladies and gentlemen, thank you very much for standing by. And welcome to the Cohen & Steers fourth quarter and 2009 financial results conference call. During this presentation all participants are in a listen-only mode. Afterwards we will conduct the question-and-answer session. (Operator Instructions). As a reminder, this conference is being recorded on Wednesday, January 27, 2010. It is now my pleasure to turn the conference over to Mr. Salvatore Rappa, Senior Vice President and Associate General Counsel at Cohen & Steers. Please go ahead, sir.

Thank you, and welcome to the Cohen & Steers fourth quarter and full year 2009 Earnings Call. Joining me is Co-Chairman and Co-Chief Executive Officers Marty Cohen and Bob Steers; our President, Joe Harvey; and our Chief Financial Officer, Matt Stadler. Before I turn the call over to Matt, I want to point out that during the course of this conference call we will make a number of forward-looking statements. These forward-looking statements are subject to various risks and uncertainties and are important factors that could cause actual outcomes to differ materially from those indicated in these statements. We believe that some of these factors are described in the Risk Factor section of our 2008 Form 10-K, which is available on our website at cohenandsteers.com. I want to remind you that the company assumes no duty to update any forward-looking statement. Also the presentation we make today contains pro forma or non-GAAP financial measures, which we believe are meaningful in evaluating the company’s performance. For detailed disclosures on these pro forma metrics and their GAAP reconciliations, you should refer to the financial data contained within the press release we issued yesterday, as well as our previous earnings releases each available on our website. Finally, this presentation may contain information with respect to the investment performance of certain of our funds. I want to remind you that past performance is not a guarantee of future performance. For more complete information about these funds, including charges, expenses and risks, please call 1-800-330-7348 for a prospectus. With that, I’ll turn the call over to Matt.

Thanks, Sal. Good morning, everyone. Yesterday we reported net income of $0.27 per share, compared with a loss of $0.05 per share in the prior year, and net income of $0.18 per share, sequentially. The fourth quarter of 2008 included charges of $0.09 per share, resulting primarily from the impairment of intangible assets and restructuring costs. After adjusting for these items earnings per share were $0.04. We reported revenue for the quarter of 39.9 million compared with 28.9 million in the prior year, and 33.8 million, sequentially. The increase in revenue from the prior year is attributable to higher average assets, resulting primarily from market appreciation and institutional net inflows. Average assets under management for the quarter were 23 billion compared with 15.7 billion in the prior year, and 19.5 billion, sequentially. Our effective fee rate for the quarter was 63 basis points, down from 63.5 basis points last quarter. The decline was primarily due to a higher proportion of institutional inflows from new and existing sub-advisory accounts, which are lower fee paying. Pre-tax income for the quarter was 15.3 million, compared with the pre-tax loss of 2.9 million in the prior year, and pre-tax income of 10 million, sequentially. The prior year’s quarter included approximately 5.9 million of charges resulting primarily from the impairment of intangible assets and restructuring costs. After adjusting for these items, pre-tax income for the fourth quarter of 2008 was 2.9 million. Our pre-tax profit margin for the fourth quarter was 37%, up from 28% in the third quarter. And our operating margin increased to 28% this quarter from 17% in the third quarter. The increase in operating margin highlights the operating leverage of our business, as revenue increased by 18%, but expenses increased by only 2%. For the year we reported a net loss…

Thanks, Matt. Good morning and thank you all for joining us. I just like to take a few minutes and add some color to Matt’s remarks. First if I could review some of our accomplishments, most important of which is that our investment performance across nearly all of our asset classes was excellent last year, and we exceeded many of our benchmarks by a very healthy margin. Our institutional asset gathering has been extremely strong as Matt mentioned, and the 3.2 billion of inflows were into all of our major strategies, domestic and global REITs, large cap value, and listed infrastructure. This has already continued into 2010. We’ve already added net new money totaling 238 million. In addition, we continue to have a very full pipeline of awarded but not yet funded commitments as well as further mandates for which we are candidates. We enjoyed excellent client retention in 2009. In fact, many of our clients added to their portfolios or initiated new mandates we gained net 25 new accounts. Interestingly, the majority, 13 of them were large-cap value, very satisfying for us, while eight were global REITs and two were listed global infrastructure. We brought on 12 entirely new relationships, with many of these clients large and prominent domestic and foreign investors. All year, despite market uncertainties, we stayed the course with respect to our internal infrastructure and personnel. As usual, we had very little employee turnover and this is paying off today as it has enabled us to gain market share in all of our strategies. Very importantly, we achieved critical mass in two critical areas: our long-short global REIT strategy and our listed global infrastructure strategy. In the last year we also faced and met a number of challenges. We needed to refinance 1.6 billion of auction…

(Operator Instructions). And our first question comes from the line of Alex Blostein from Goldman Sachs. Please proceed with your question.

Quick question on the institutional pipeline, it sounds like things continue to progress pretty well early in January. Can you help us get a sense on what the size of other mandates that you’ve won, but have not yet funded? And then I have a follow-up.

Matt, you have that number exactly. It’s about 200 million that has been awarded but not yet funded.

Right, and that’s mostly in the alternative area. About half of that’s already been funded and the other half will be funded in the next couple of weeks. Besides that, as Marty indicated, the institutional pipeline as far as finals and other activity that’s out there is still pretty full. But it’s not like we have something that we’re going to be receiving a flow in the next couple of weeks there, but it’s progressing nicely.

And they’re typically large mandates. In our space, interestingly, in the REIT area, the accounts are getting larger and larger, as more and more investors are getting interested in liquid real estate alternatives. Clearly, in a large cap value area, that’s a core investment strategy and in the institutional side potential mandates there tend to be in the large category. And we’ve had great success on the listed infrastructure side with 100 plus mandates already funded. And we think that this is an area that is going to be of great interest in the coming years. There’s a lot of money being spent on infrastructure. There is a lot of money that went into private infrastructure, a lot of that failed, and the liquid alternatives into companies that are building roads, cell towers, ports, seaports, airports, et cetera, in United States, overseas, and in emerging markets is very substantial. And there’s a substantial amount of interest there. So on the institutional side we could be seeing some good sized mandates there.

Understood. And then just briefly on capital management. The balance sheet obviously remains in pretty healthy shape. Could you give us a sense of priority-wise dividend, buybacks, or potential add-on acquisitions?

I think we’ve always had a dividend policy. We believe in dividends, and we practice that. We practice what we preach. We reduced our dividend as our profits went down, and we’ll probably increase the dividend as profits go up, but that’s up to the Board to decide. We make that an annual decision, which will make it on our March Board meeting. So that’s a high priority, but that’s not a large use of our existing cash. Then I think the next priority really is co-investing. A lot of the strategies that we that we seed or incubate require capital, and as we get deeper into the alternative world, co-investment with clients is going to be required, so we want to have sufficient capital for that. Acquisitions, you can make it a priority, but they don’t happen until they are available. And sometimes it can take a long time, sometimes it can happen quickly. If and when the right acquisition takes place, we believe we’ll have sufficient capital and certainly sufficient resources to accommodate that, if that were to happen.

Understood. And then the last question just on the structure of the performance fee potential for 2010. I guess you mentioned the size of the product is around $200 million. Can you help us understand exactly what, I guess, is the fee rate, and is there a hurdle on that product?

Well, the fee rates, I think, we said on a prior call, it’s 1.5% in 20 if it’s in the hedge fund. And some assets are coming in that’s in the same strategy but it’s outside the hedge fund. So the fees would be a little bit lower. We get the management fee from day one. And the performance fee would just be based upon profits that are generated in the account from the time that you get in to 12/31. So to the extent that there is an appreciation in your investment, there’d be anywhere from 15 to 20% of that profit would be recorded as an incentive fee. We’re not going to record incentive fees until 12/31 when it’s earned.

What about management fees?

Our management fees will always be recorded and collected, correct.

As earned.

Continuing on, our next question comes from the line of Cynthia Mayer, Bank of America-Merrill Lynch. Your line is open. Please go ahead.

I guess, in terms of the positive flows you’re seeing on the retail side in the mutual funds, do you have a sense of whether investors are interested in buying for the yield at this point? How important is the yield versus capital appreciation, and are you seeing more interest in non-U.S. versus U.S. REIT funds? And also just in terms of the institutional flows in 4Q, how much of those flows were to large cap value versus real estate?

Well, the retail side -- it’s hard to generalize, Cynthia. We’re seeing interest in both yield and total return, but I think the story that is increasingly gaining traction out there with investors, both retail and institutional, is the strategic positioning REITs have in front of what is likely to be a significant acquisition opportunity looming out there, which could, as an external growth possibility, could really have an impact on growth rates. So I think the yields are attractive. I think REITs are looked at as sort of a bridge to equities from fixed income, and so we’re seeing interest on both sides. Our retail focus, as Marty mentioned, is changing and shifting a little bit, and our sales force is mainly focused on the larger, corner office teams, whether they are in the BD or RIA channel. So we’re having more sophisticated conversations about strategies, and as such they’re less focused on just a simple dividend yield than they are the comprehensive story.

Okay.

Matt, do you have the breakdown of value versus the other strategies?

Yes. Large cap value came in about 1.1 billion of the 3.2 billion of net inflows were into large cap value strategies. And the other one you wanted in --

No, no, no. I was just wondering for 4Q, if it was about the same, a third of it.

No, no, no. I was just wondering for 4Q, if it was about the same, a third of it.

Yes.

Okay. And then you mentioned you’re seeing more opportunities. And I know you talk about this every quarter, but can you just update us on what kinds of opportunities you’d be most interested in, in terms of acquisitions or investments?

We’re most interested I think in acquisitions that are related to the things that we’re already doing. But we would also be looking at things that are related, maybe one step removed. But we’re looking for acquisitions that make sense from a size standpoint, from a strategic product positioning standpoint. And whereas historically, as you know, we have added strategies mainly through lift outs of teams, and generally, they didn’t bring any assets with them. And given our balance sheet, and given the current environment, we’re less interested in lift outs and more interested in adding capabilities that bring assets with them.

Great.

Cynthia, let me just mention here as an update for the quarter, the fourth quarter, the majority of the inflows, the net inflows that we saw in the institutional area were for global and international mandates and global infrastructure. Large cap value was the bigger component for the year, but not for the fourth quarter. We have received some mandates subsequent to year-end of pretty good size, that’s incremental to the 200 million that I mentioned to Alex when he was on the call, and that went into large cap value. So our large cap value is starting, for the first quarter of this year, picking up again for the institutional mandates.

Okay. Great. Just last question on closed-end funds. We’ve seen some other managers offer shelf registrations for new shares. Is that something you’d be interested in doing?

We think that adding supply to the market does not help the fund shareholder necessarily, so we’re not that interested in adding shares. We have, and we are in the process of continuing to combine some of our closed-end funds, so that our asset levels don’t change, but the shareholders can achieve some economies of scale. We want to do something. If we’re going to do anything, it’s going to have to be very shareholder friendly. And merging funds does create some accretion, and that’s what we’re focused on, not adding this to the share counts.

Okay. And I guess just last question, a more general question on the margin. Your margins have obviously come back quite a bit, and assuming that the market stabilized a little bit, should we expect continued margin expansion at this point, or should we sort of expect this is a decent level considering you’re reinvesting and that you expect the 4Q comp was a bit of a true up, went down for a true up?

We never really managed through margins, but I think, if you plug in a upper 30% comp ration, and then you put in some assumptions on asset growth and appreciation, the margins should grow. I think if you look at our head count, we ended 2009 exactly where we were in 2008, which illustrates the leveragability in the business. And anything that we might do externally would need to be accretive, so it would essentially not hurt the margins. And I think that to the extent that we’re going to be expanding the infrastructure, it’ll be in response to assets gathered and results growing on the top line, so that we’re mindful always of margin compression not happening because we’re growing the expenses. That’s why -

Okay. Great.

Now G&A being up a little bit less than 5% I think illustrates that, we’re still serious about cost control and we’re going to be very diligent in implementing that.

(Operator Instructions). And our next question comes from the line of Mike Carrier from Deutsche Bank. Please proceed with your question.

I always thought you guys in the retail distribution channel were fairly well entrenched. So just in terms of the build-out there, I guess, what are you trying to do, and where do you see the opportunities?

Well, what we’re trying to do is to, as Marty mentioned, adapt to a changing market. And you’re well aware of the trends, whether it’s large teams going independent and so on and so forth. And we’re simply sharpening our focus, starting at the corporate level where we’re making a big effort to work with a half a dozen firms to really first be involved with them at the strategic planning level so that we can fit into their business plans. And then translating that into field activities, having our regional wholesalers focused on the larger teams that are of more sophisticated investors and that are more asset allocation-oriented. And that could be in the BD channel, RIA or independent. And we’re really pursuing a follow-the-team strategy as opposed to simply focus on certain firms. And as a result, we’ve begun to make several changes at the senior levels in the national sales group and bring in people who have these relationships and have implemented these strategies previously.

Okay.

But it shouldn’t result in any change in our cost structure.

Yes.

There’s something I want to add. The old model of pretty much every fund, every product goes on the shelf because it doesn’t cost anything. That’s out, that’s gone. It’s really now a much more selective model that most brokerage firms and investment advisors are using. You’ve got to be best in class. You have to have all the right attributes in order to get there and to get in there. And that’s at the firm level, so you’ve got to have good relationships there, and then you got to deliver something to that more sophisticated financial advisor. I don’t know what the exact numbers are, but there’s probably an 80/20 rule. You’ve got the biggest advisors, the advisors that manage the most money are the ones that are using the most sophisticated models and methods, and those are the ones that we appeal to because we’re very targeted in what we offer them.

And Mike, the conversations that we’re now having, starting with the gatekeepers in the home offices, are more comprehensive. So for example, today we offer the full range of real estate strategies from listed, hedged and private on a global basis. And the conversations we’re having is, whether it’s with a large distribution entity or some large regional teams is you should really think of us as a firm that you can outsource your entire real estate allocation to. Really look at us as being your real estate CIO, as opposed to years ago when the conversation was, “Hey, we’ve got an industry-leading performance in a U.S. REIT fund, what do you think?” So, we’re having those conversations with some of the largest institutions in the world, and we’re having those same conversations with distributors, both at the gatekeeper level and in the field with the teams.

Okay. That’s helpful. And then, Matt, maybe just on the fee, the fee rates and the color on the waivers, that’s helpful. Just so we can balance that with the shift in assets from institutional to retail, can you give us just a rough ballpark on the institutional fees versus the retail fees?

Well, the institutional fees -- you’re saying in general, and then trying to give you the composition of the 60 –?

Yes, I guess, the retail, we can go through the funds and get it. The institutional is a little tougher.

Yes.

So just the incrementals, just so if the institutional continues to grow at a faster rate, we just --

Well, the way we’re thinking is that the mandates that we’re getting in on the institutional side, with a bigger piece being from sub-advisory relationships that we’ve nurtured and started to get significant flows from, have been compressing the institutional fee rate over the past few quarters. So, I think if you’re looking into 2010, you’ll probably see that tick down closer to 40ish. We’ve been over 40 all along. And I think the more sub-advised business that we get there will be a little compression there. On the closed-end will go up a little bit because of the fee waivers. On the open-end, as the assets increase, we’re starting to get back to the breakpoints that caused some asset decline. Like in CSR, we’re going to hit another plateau and we’re going to go down 10 basis points there. But offsetting that is in IRF, if you look at third quarter versus fourth quarter average assets in IRF, that actually increased, and IRF is a 95 basis point fund. So I think the open-ends, assuming that the flows continue to offset one another, should be pretty static. Closed-ends will move up a little bit and institutional will move down a little bit.

Thank you, sir. Gentlemen that does conclude the conference in terms of the questions that we have currently online. I will turn it back to you once again gentlemen for your conclusion. Thank you.

Well, again, thank you all for joining us, and we look forward to speaking to you next quarter. Have a good day.

Thank you, sir. Ladies and gentlemen, that does conclude the conference call for today. We thank you all for your participation, and ask that you please disconnect. Thank you once again. Have a great day.