Ladies and gentlemen, thank you for standing by. Welcome to the Cohen & Steers' Second Quarter 2010 Financial Results Conference Call. During the presentation, all participants will be on a listen-only mode. Afterwards, we will conduct a question-and-answer session. (Operator Instructions). It is now my pleasure to turn the conference over to Mr. Salvatore Rappa, Senior Vice President and Associate General Counsel. Please go ahead, sir.

Thank you, and welcome to the Cohen & Steers' second quarter 2010 earnings conference call. Joining me are 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 may make a number of forward-looking statements. These forward-looking statements are subject to various risks and uncertainties and there 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 factors section of our 2009 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 statements. 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, and then 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 and. Thank you for joining us today. Yesterday, we reported net income of $0.27 per share compared to a loss of $0.15 per share in the prior year and net income of $0.21 per share sequentially. The second quarter of 2010 includes an $0.08 per share after tax gain resulting from recoveries on the sale of previously impaired securities. After adjusting for this item, earnings per share were $0.19. The second quarter of 2009 included a $0.30 per share impairment charge on available-for-sale securities. After adjusting for this item, earnings per share were $0.15. We reported revenue for the quarter of 44.2 million compared with 26.4 million in the prior year and 41.3 million sequentially. The increase in revenue from the prior year is attributable to higher average assets resulting primarily for market depreciation and institutional net inflows. Average assets for the quarter were 27 billion compared with 14.6 billion in the prior year and 24.9 billion sequentially. Our effective fee rates for the quarter were 60.5 basis points, down from 61.5 basis points last quarter. The decline was primarily due to a higher proportion of institutional inflows from existing sub-advisory accounts which are lower fee-paying. Pretax income for the quarter was 15.4 million compared with a pretax loss of 5 million in the prior year and pretax income of 13.5 million sequentially. This quarter's results include a 3.1 million recovery on the sale of previously impaired securities. After adjusting for this item, pretax income was 12.2 million. The prior year's quarter included an impairment charge of 14 million on available-for-sales-securities. After adjusting for this item pretax income was 9.1 million. Excluding the 3.1 million recovery on the sale of previously impaired securities, our pretax profit margin for the second quarter was 28%. Our operating…

Thank you Matt and thank you all for listening this morning. Clearly the story for the quarter and for that matter the past year has been our net inflows. Overall as a company, we enjoyed an 18% organic growth rate in the second quarter and excluding closed-end funds that number was 23%. And the 12 months number is as well industry leading. As a result our decline in AUM during the quarter was relatively modest when you consider that the market head wins were quite severe. Our benchmarks declined anywhere from 4 to 11% in the second quarter. I'd also like to note however that it appears that our asset in global diversification is working well for us as the co-relation of our assets under management to just the U.S. REIT Indexes continued to decline. Since the quarter, we have already added about 425 million in institutional assets that have either already funded or will do so shortly and in addition third quarter performance has started out quite well with benchmarks up in the 4 to 7% range reversing some of the deterioration that we had in the second quarter. There are two areas that we think are worthy of discussing in greater detail. The first is the breadth of our distribution. The majority of our assets and net flows have been in a category we call institutional separate accounts. We have approximately 100 accounts directly with pension and endowment funds and the like. A large amount of assets in this category however, is in sub-advisory mandates. We treat them as institutions since the relationship is directly with the sponsors of these funds. They range from consultants to banks, insurance companies and other financial institutions. They exclude broker-dealers and registered investment advisors which we categorize as retail. We have upwards…

(Operator Instructions). Our first question comes from the line of Michael Carrier of Deutsche Bank. Please proceed with your question.

Alright, thanks guys. Just on the distribution side, you called on the institutional separate accounts. When your talking to those clients, where is the most interest in terms of products and then, in terms of the penetration in the different markets whether it's the U.S., you mentioned, Europe, Japan, Australia. Like how much more do you have to go when you look at the landscape there in terms of the number of accounts that you have relationships versus what you consider the market opportunity? And then just one the fee rate, a last one for Matt, is relative to the fund business, what are these fee rates coming in at just so we can gauge the realization rate going forward.

Well taking into confidence one at a time, Japan has been very successful for us with our relationship with Daiwa Securities and Daiwa Asset Management. We think there is room to grow there. There is a great deal of interest in global real estate investing. We have continued flows and based on a competitive analysis we think there is room there. In Australia as everyone knows there is a great deal of demand for investment products with respect to the superannuation funds and we've got a pretty good presence there. We think there is a lot of room to grow in Australia. And in Continental Europe it's been somewhat -- some platform investing. There has also been some separate accounts directly with institutions. On the fee side, they vary. I think Matt can give you a little color on that. Understand, we talk about fees, we're talking about net fees to us and there is a lot of costs and it's not as simple as that but we can give you some color on that.

Sure. With respect to open-end and closed-end, we haven't really seen too much movement. Closed-end is going up because of fee waivers but essentially they've been pretty static. Most of the flows that we've been getting as we said in our remarks have been sub-advisory and as sub-advisory relationships in general has become a bigger proportion of the overall institutional assets that we manage. There has been an adjustment to the fees. So, what we are seeing coming in now is more in the mid-30 range on the sub-advisory basis blended. And that's which we really are having the effective bringing the effective fee rate down. You know, we see maybe a slight reduction in the third and the fourth quarter from second quarter levels but not as much as we saw from the first quarter to second quarter.

Sure. With respect to open-end and closed-end, we haven't really seen too much movement. Closed-end is going up because of fee waivers but essentially they've been pretty static. Most of the flows that we've been getting as we said in our remarks have been sub-advisory and as sub-advisory relationships in general has become a bigger proportion of the overall institutional assets that we manage. There has been an adjustment to the fees. So, what we are seeing coming in now is more in the mid-30 range on the sub-advisory basis blended. And that's which we really are having the effective bringing the effective fee rate down. You know, we see maybe a slight reduction in the third and the fourth quarter from second quarter levels but not as much as we saw from the first quarter to second quarter.

Okay. That's helpful. And then just on the expense side. In terms of the comp ratio and just given the level of business activity, I guess where we would, you know, the asset levels have to be or where would revenues have to be, just balancing all the investment and that kind of stuff that you're doing, but where we would could see that start to trend down and then we could see the operating leverage start to pickup in the model?

Yeah. I think what we believe that for the rest of this year, at least where we see it today, 39% is the right number. But, everybody's got a model. So, we would think that in 2011, the comp ratio would start to tick down a little bit, and we have it coming down anywhere from, 3 to maybe like 10%, 10 to 12%, 15% reduction in 2011 from where it is now.

Okay. Thanks a lot.

You mean like 3 points, the ratio?

You mean like 3 points, the ratio?

It's going to come down 5%, 10 to 15% down from where it is now. So, it is maybe like the 35%, 34% ratio for next year.

Okay.

You know, that is a lot of assumption there of course.

You know, that is a lot of assumption there of course.

Appreciation of flows.

If the trends continue, that's where it maybe headed.

If the trends continue, that's where it maybe headed.

Okay. Thanks a lot.

(Operator Instructions) Our next question comes from the lines Alex Blostein of Goldman Sachs. Please proceed with your question. Mr. Blostein, your line is open. We cannot hear you. Please verify the mute function on your phone or pick up your handset please.

Sorry about that. Good morning, guys.

Good morning.

Good morning.

Do you hear me now? Is it possible to get a little more granularity on this usual business and I guess which strategy specifically you have been seeing the most in flow, I guess, for the first of year and the pipeline that you mentioned little bit over of $100 million? So, which strategies are getting more traction then and how much of that is coming from you versus the requirements?

Well, we didn't catch all of that question; you were breaking up a little. But, with respect to which strategies were driving growth, there is no simple answer there. In the U.S. for the first half of the year, large-cap value was really the leading asset growth category for us. Outside the U.S., in Japan it's all about REITs and Australia REITs but also lifted infrastructure, we've made some gain significant mandates there. In Europe, it's mainly REIT. I would say more recently global REITs infrastructure and our long-short fund have had good momentum, large cap value seems to be doing fine but not with as much momentum as we saw earlier in the year. And in the open-end side, we've been seeing the majority of the flows coming into U.S. REIT fund such as CSR.

Well, we didn't catch all of that question; you were breaking up a little. But, with respect to which strategies were driving growth, there is no simple answer there. In the U.S. for the first half of the year, large-cap value was really the leading asset growth category for us. Outside the U.S., in Japan it's all about REITs and Australia REITs but also lifted infrastructure, we've made some gain significant mandates there. In Europe, it's mainly REIT. I would say more recently global REITs infrastructure and our long-short fund have had good momentum, large cap value seems to be doing fine but not with as much momentum as we saw earlier in the year. And in the open-end side, we've been seeing the majority of the flows coming into U.S. REIT fund such as CSR.

Got it. And then on capital management, you guys have one of the best balance sheets of say in aforementioned space and the cash balances continue to grow, any plans to either any other buyback or dividend or any other capital plans you could highlight?

Well, we have said in the past there are four, we didn't have a lot of cash, there is four things we can do. One is nothing, two is buyback stock, three is making acquisition and four is making distribution and right now we've not made any decisions on anyone of those other than number one which is at the moment maintain our balance sheet as it is.

Got it, thanks.

Our next question comes from the line of Dov Hellman with Sidoti & Company. Please proceed with your question. Dov Hellman - Sidoti & Company: Hi, guys. The first question I have actually on the retail distribution side, where are you seeing most of the traction is that still IRAs or broker-dealers are coming in, where are you seeing there, I guess, the inflows from?

It's still mainly the IRAs and the broker-dealer market as shown a little bit of incremental strength but it seems to have been flowing short-term trends in the marketplace frankly, so the IRA channels, I think, has continued to be the area where we see steady inflows.

It's still mainly the IRAs and the broker-dealer market as shown a little bit of incremental strength but it seems to have been flowing short-term trends in the marketplace frankly, so the IRA channels, I think, has continued to be the area where we see steady inflows. Dov Hellman - Sidoti & Company: Got it.

We're -- we as, Marty mentioned, we did launch our preferred fund, it's early yet and it's not in every system that we'd like to be in but that's a relatively high yielding fund for us and we're seeing some good initial response there.

We're -- we as, Marty mentioned, we did launch our preferred fund, it's early yet and it's not in every system that we'd like to be in but that's a relatively high yielding fund for us and we're seeing some good initial response there. Dov Hellman - Sidoti & Company: Okay and then also now in terms of institutional, looking at the large CapEx, I think you talked that kind of still having good flows but you talked that it's lower than it was I guess in the beginning of the year. Is that in anyway, and looking this performance obviously the one year and year-to-date, it has unperformed at least the benchmark, what are the discussions there I guess and what is also in terms of I guess the positioning of the portfolio, what is done, I know this exposure to financials there and energy, if there are any changes in terms of I guess, the portfolio as well?

Well, we probably are not going to comment on we've what are the changes in the portfolio but again I think the strength in large cap value is on the separate account area, there hasn't been a lot of traction there in retail land and you're correct that the performance over the last 12 months a relative performance is below what we expect from that, from that portfolio and I think it's a combination of the relative performance but also just our senses that investors are just not putting a lot of money into loan only strategies right now on the institutional side. Dov Hellman - Sidoti & Company: Makes sense and just lastly in terms of I guess your long/short portfolio, your long/short read portfolio the global long/short, what -- I don't know if you care to comment me on just the performance there and also I guess what is now the -- your share of the investment of that portfolio.

Sure, this is Joe. For the year-to-date through June on a net basis the fund was down a little less than 2% and that's in line with the average long/short equity fund universe, I'm sure your well aware it's been a very difficult environment just from a volatility perspective if you look at it day-to-day movements in the market, but we're still very optimistic about the strategy and what the teams performance will be. Dov Hellman - Sidoti & Company: Got it, perfect.

Our investments are about 35 million and were about 43% of the fund. Dov Hellman - Sidoti & Company: Thank you, that's it.

Our final question comes from the line of Cynthia Mayer with Bank of America/Merrill Lynch. Please proceed with your question.

Thanks, good morning. This is Adam [Bede] in for Cynthia, in the context of the new preferred fund you mentioned the potential for a prolonged sort of low interest rate environment, in general on the institutional side as you've won some of these mandates and other expressions of interest, have you seen already investors searching for better income generating in investments or is it more of just now occasion to the real estate asset class and particularly on the real estate side, do you feel that your gaining market share again similar funds or is the market just expanding as more institutional investors allocate to real estate?

We haven't really seen institutional investors looking just for yield and I would say that preferred fund is aimed largely at retail investors and the institutional money coming into real estate or reads is including the hedge fund is largely a real asset allocation and they are looking for both attractive real returns, weather it's in a low inflation, low interest rate environment, but also, hedging themselves against the possibilities of higher interest rates and inflation and that's I think very much driving our rising allocations to real asset strategies such as real estate.

Got it, thank you that's all I have. That's helpful. Thank you.

This concludes our Q&A session today. Now I'll turn the conference back over to our presenters.

Thank you for listening in again and we look forward to speaking to you next quarter.