Aligning asset allocation and real estate investment: some lessons from the last cycle

Asset allocation is concerned with the development of multi--‐asset portfolio strategies that are likely to meet an investor’s objectives based on the interaction of expected returns, risk, correlation and implementation from a range of distinct asset classes or beta sources. Challenges associated with the discipline are often particularly significant in private markets. Specifically, composition differences between the ‘index’ or ‘benchmark’ universe and the investible universe mean that there can often be substantial and meaningful deviations between the investment characteristics implied in asset allocation decisions and those delivered by investment teams. For example, while allocation decisions are often based on relatively low--‐risk diversified real estate ‘equity’ exposure, implementation decisions frequently include exposure to higher risk forms of the asset class as well as investments in debt based instruments. These differences can have a meaningful impact on the contribution of the asset class to the overall portfolio and, therefore, lead to a potential misalignment between asset allocation decisions and implementation. Despite this, the key conclusion from this paper is not that real estate investors should become slaves to a narrowly defined mandate based on IPD / NCREIF or other forms of benchmark replication. The discussion suggests that such an approach would likely lead to the underutilization of real estate in multi--‐asset portfolio strategies. Instead, it is that to achieve asset allocation alignment, real estate exposure should be divided into multiple pools representing distinct forms of the asset class. In addition, the paper suggests that associated investment guidelines and processes should be collaborative and reflect the portfolio wide asset allocation objectives of each pool. Further, where appropriate they should specifically target potential for ‘additional’ beta or, more marginally, ‘alpha’.

Comparative study of the performance of the M-cycle counter-flow and cross-flow heat exchangers for indirect evaporative cooling - paving the path towards sustainable cooling of buildings

This paper provides a comparative study of the performance of cross-flow and counter-flow M-cycle heat exchangers for dew point cooling. It is recognised that evaporative cooling systems offer a low energy alternative to conventional air conditioning units. Recently emerged dew point cooling, as the renovated evaporative cooling configuration, is claimed to have much higher cooling output over the conventional evaporative modes owing to use of the M-cycle heat exchangers. Cross-flow and counter-flow heat exchangers, as the available structures for M-cycle dew point cooling processing, were theoretically and experimentally investigated to identify the difference in cooling effectiveness of both under the parallel structural/operational conditions, optimise the geometrical sizes of the exchangers and suggest their favourite operational conditions. Through development of a dedicated computer model and case-by-case experimental testing and validation, a parametric study of the cooling performance of the counter-flow and cross-flow heat exchangers was carried out. The results showed the counter-flow exchanger offered greater (around 20% higher) cooling capacity, as well as greater (15%–23% higher) dew-point and wet-bulb effectiveness when equal in physical size and under the same operating conditions. The cross-flow system, however, had a greater (10% higher) Energy Efficiency (COP). As the increased cooling effectiveness will lead to reduced air volume flow rate, smaller system size and lower cost, whilst the size and cost are the inherent barriers for use of dew point cooling as the alternation of the conventional cooling systems, the counter-flow system is considered to offer practical advantages over the cross-flow system that would aid the uptake of this low energy cooling alternative. In line with increased global demand for energy in cooling of building, largely by economic booming of emerging developing nations and recognised global warming, the research results will be of significant importance in terms of promoting deployment of the low energy dew point cooling system, helping reduction of energy use in cooling of buildings and cut of the associated carbon emission.

Climate warming–related strengthening of the tropical hydrological cycle

The authors estimate climate warming–related twenty-first-century changes of moisture transports from the descending into the ascending regions in the tropics. Unlike previous studies that employ time and space averaging, here homogeneous high horizontal and vertical resolution data from an Intergovernmental Panel on Climate Change Fourth Assessment Report (IPCC AR4) climate model are used. This allows for estimating changes in much greater detail (e.g., the estimation of the distribution of ascending and descending regions, changes in the vertical profile, and separating changes of the inward and outward transports). Low-level inward and midlevel outward moisture transports of the convective regions in the tropics are found to increase in a simulated anthropogenically warmed climate as compared to a simulated twentieth-century atmosphere, indicating an intensification of the hydrological cycle. Since an increase of absolute inward transport exceeds the absolute increase of outward transport, the resulting budget is positive, meaning that more water is projected to converge in the moist tropics. The intensification is found mainly to be due to the higher amount of water in the atmosphere, while the contribution of weakening wind counteracts this response marginally. In addition the changing statistical properties of the vertical profile of the moisture transport are investigated and the importance of the substantial outflow of moisture from the moist tropics at midlevels is demonstrated.

The global atmospheric water cycle

Water vapour plays a key role in the Earth's energy balance. Almost 50% of the absorbed solar radiation at the surface is used to cool the surface, through evaporation, and warm the atmosphere, through release of latent heat. Latent heat is the single largest factor in warming the atmosphere and in transporting heat from low to high latitudes. Water vapour is also the dominant greenhouse gas and contributes to a warming of the climate system by some 24°C (Kondratev 1972). However, water vapour is a passive component in the troposphere as it is uniquely determined by temperature and should therefore be seen as a part of the climate feedback system. In this short overview, we will first describe the water on planet Earth and the role of the hydrological cycle: the way water vapour is transported between oceans and continents and the return of water via rivers to the oceans. Generally water vapour is well observed and analysed; however, there are considerable obstacles to observing precipitation, in particular over the oceans. The response of the hydrological cycle to global warming is far reaching. Because different physical processes control the change in water vapour and evaporation/precipitation, this leads to a more extreme distribution of precipitation making, in general, wet areas wetter and dry areas dryer. Another consequence is a transition towards more intense precipitation. It is to be expected that the changes in the hydrological cycle as a consequence of climate warming may be more severe that the temperature changes.

Wall materials and techniques available for low cost housing in Khartoum from a sustainability point of view

Khartoum like many cities in least developing countries (LDCs) still witnesses huge influx of people. Accommodation of the new comers leads to encroachment on the cultivation land leads to sprawl expansion of Greater Khartoum. The city expanded in diameter from 16.8 km in 1955 to 802.5 km in 1998. Most of this horizontal expansion was residential. In 2008 Khartoum accommodated 29% of the urban population of Sudan. Today Khartoum is considered as one of 43 major cities in Africa that accommodates more than 1 million inhabitants. Most of new comers live in the outskirts of the city e.g. Dar El-Salam and Mayo neighbourhoods. The majority of those new comers built their houses especially the walls from mud, wood, straw and sacks. Selection of building materials usually depends on its price regardless of the environmental impact, quality, thermal performance and life of the material. Most of the time, this results in increasing the cost with variables of impacts over the environment during the life of the building. Therefore, consideration of the environmental impacts, social impacts and economic impacts is crucial in the selection of any building material. Decreasing such impacts could lead to more sustainable housing. Comparing the sustainability of the available wall building materials for low cost housing in Khartoum is carried out through the life cycle assessment (LCA) technique. The purpose of this paper is to compare the most available local building materials for walls for the urban poor of Khartoum from a sustainability point of view by going through the manufacturing of the materials, the use of these materials and then the disposal of the materials after their life comes to an end. Findings reveal that traditional red bricks couldn’t be considered as a sustainable wall building material that will draw the future of the low cost housing in Greater Khartoum. On the other hand, results of the comparison lead to draw attention to the wide range of the soil techniques and to its potentials to be a promising sustainable wall material for urban low cost housing in Khartoum.

Impact of strong deep ocean stratification on the glacial carbon cycle

During the Last Glacial Maximum, the climate was substantially colder and the carbon cycle was clearly different from the late Holocene. According to proxy data deep oceanic δ13C was very low, and the atmospheric CO2 concentration also reduced. Several mechanisms have been proposed to explain these changes, but none can fully explain the data, especially the very low deep ocean δ13C values. Oceanic core data show that the deep ocean was very cold and salty, which would lead to enhanced deep ocean stratification. We show that such an enhanced stratification in the coupled climate model CLIMBER-2 helps get very low deep oceanic δ13C values. Indeed the simulated δ13C reaches values as low as −0.8‰ in line with proxy data evidences. Moreover it increases the oceanic carbon reservoir leading to a small, yet robust, atmospheric CO2 drop of approximately 10 ppm.

Impact of brine-induced stratification on the glacial carbon cycle

During the cold period of the Last Glacial Maximum (LGM, about 21 000 years ago) atmospheric CO2 was around 190 ppm, much lower than the pre-industrial concentration of 280 ppm. The causes of this substantial drop remain partially unresolved, despite intense research. Understanding the origin of reduced atmospheric CO2 during glacial times is crucial to comprehend the evolution of the different carbon reservoirs within the Earth system (atmosphere, terrestrial biosphere and ocean). In this context, the ocean is believed to play a major role as it can store large amounts of carbon, especially in the abyss, which is a carbon reservoir that is thought to have expanded during glacial times. To create this larger reservoir, one possible mechanism is to produce very dense glacial waters, thereby stratifying the deep ocean and reducing the carbon exchange between the deep and upper ocean. The existence of such very dense waters has been inferred in the LGM deep Atlantic from sediment pore water salinity and δ18O inferred temperature. Based on these observations, we study the impact of a brine mechanism on the glacial carbon cycle. This mechanism relies on the formation and rapid sinking of brines, very salty water released during sea ice formation, which brings salty dense water down to the bottom of the ocean. It provides two major features: a direct link from the surface to the deep ocean along with an efficient way of setting a strong stratification. We show with the CLIMBER-2 carbon-climate model that such a brine mechanism can account for a significant decrease in atmospheric CO2 and contribute to the glacial-interglacial change. This mechanism can be amplified by low vertical diffusion resulting from the brine-induced stratification. The modeled glacial distribution of oceanic δ13C as well as the deep ocean salinity are substantially improved and better agree with reconstructions from sediment cores, suggesting that such a mechanism could have played an important role during glacial times.

Time valued life cycle greenhouse gas emissions from buildings

The UK has adopted legally binding carbon reduction targets of 34% by 2020 and 80% by 2050 (measured against the 1990 baseline). Buildings are estimated to be responsible for more than 50% of greenhouse gas (GHG) emissions in the UK. These consist of both operational, produced during use, and embodied, produced during manufacture of materials and components, and during construction, refurbishments and demolition. A brief assessment suggests that it is unlikely that UK emission reduction targets can be met without substantial reductions in both Oc and Ec. Oc occurs over the lifetime of a building whereas the bulk of Ec occurs at the start of a building’s life. A time value for emissions could influence the decision making process when it comes to comparing mitigation measures which have benefits that occur at different times. An example might be the choice between building construction using low Ec construction materials versus building construction using high Ec construction materials but with lower Oc, although the use of high Ec materials does not necessarily imply a lower Oc. Particular time related issues examined here are: the urgency of the need to achieve large emissions reductions during the next 10 to 20 years; the earlier effective action is taken, the less costly it will be; future reduction in carbon intensity of energy supply; the carbon cycle and relationship between the release of GHG’s and their subsequent concentrations in the atmosphere. An equation is proposed, which weights emissions according to when they occur during the building life cycle, and which effectively increases Ec as a proportion of the total, suggesting that reducing Ec is likely to be more beneficial, in terms of climate change, for most new buildings. Thus, giving higher priority to Ec reductions is likely to result in a bigger positive impact on climate change and mitigation costs.

Implications of the recent low solar minimum for the solar wind during the Maunder minimum

The behavior of the Sun and near-Earth space during grand solar minima is not understood; however, the recent long and low minimum of the decadal-scale solar cycle gives some important clues, with implications for understanding the solar dynamo and predicting space weather conditions. The speed of the near-Earth solar wind and the strength of the interplanetary magnetic field (IMF) embedded within it can be reliably reconstructed for before the advent of spacecraft monitoring using observations of geomagnetic activity that extend back to the mid-19th century. We show that during the solar cycle minima around 1879 and 1901 the average solar wind speed was exceptionally low, implying the Earth remained within the streamer belt of slow solar wind flow for extended periods. This is consistent with a broader streamer belt, which was also a feature of the recent low minimum (2009), and yields a prediction that the low near-Earth IMF during the Maunder minimum (1640-1700), as derived from models and deduced from cosmogenic isotopes, was accompanied by a persistent and relatively constant solar wind of speed roughly half the average for the modern era.

Reconstruction of geomagnetic activity and near-Earth interplanetary conditions over the past 167 yr - Part 3: improved representation of solar cycle 11

Svalgaard (2014) has recently pointed out that the calibration of the Helsinki magnetic observatory’s H component variometer was probably in error in published data for the years 1866–1874.5 and that this makes the interdiurnal variation index based on daily means, IDV(1d), (Lockwood et al., 2013a), and the interplanetary magnetic field strength derived from it (Lockwood et al., 2013b), too low around the peak of solar cycle 11. We use data from the modern Nurmijarvi station, relatively close to the site of the original Helsinki Observatory, to confirm a 30% underestimation in this interval and hence our results are fully consistent with the correction derived by Svalgaard. We show that the best method for recalibration uses the Helsinki Ak(H) and aa indices and is accurate to ±10 %. This makes it preferable to recalibration using either the sunspot number or the diurnal range of geomagnetic activity which we find to be accurate to ±20 %. In the case of Helsinki data during cycle 11, the two recalibration methods produce very similar corrections which are here confirmed using newly digitised data from the nearby St Petersburg observatory and also using declination data from Helsinki. However, we show that the IDV index is, compared to later years, too similar to sunspot number before 1872, revealing independence of the two data series has been lost; either because the geomagnetic data used to compile IDV has been corrected using sunspot numbers, or vice versa, or both. We present corrected data sequences for both the IDV(1d) index and the reconstructed IMF (interplanetary magnetic field).We also analyse the relationship between the derived near-Earth IMF and the sunspot number and point out the relevance of the prior history of solar activity, in addition to the contemporaneous value, to estimating any “floor” value of the near-Earth interplanetary field.

Propagation of the Madden-Julian Oscillation through the Maritime Continent and scale interaction with the diurnal cycle of precipitation

The convectively active part of the Madden-Julian Oscillation (MJO) propagates eastward through the warm pool, from the Indian Ocean through the Maritime Continent (the Indonesian archipelago) to the western Pacific. The Maritime Continent's complex topography means the exact nature of the MJO propagation through this region is unclear. Model simulations of the MJO are often poor over the region, leading to local errors in latent heat release and global errors in medium-range weather prediction and climate simulation. Using 14 northern winters of TRMM satellite data it is shown that, where the mean diurnal cycle of precipitation is strong, 80% of the MJO precipitation signal in the Maritime Continent is accounted for by changes in the amplitude of the diurnal cycle. Additionally, the relationship between outgoing long-wave radiation (OLR) and precipitation is weakened here, such that OLR is no longer a reliable proxy for precipitation. The canonical view of the MJO as the smooth eastward propagation of a large-scale precipitation envelope also breaks down over the islands of the Maritime Continent. Instead, a vanguard of precipitation (anomalies of 2.5 mm day^-1 over 10^6 km^2) jumps ahead of the main body by approximately 6 days or 2000 km. Hence, there can be enhanced precipitation over Sumatra, Borneo or New Guinea when the large-scale MJO envelope over the surrounding ocean is one of suppressed precipitation. This behaviour can be accommodated into existing MJO theories. Frictional and topographic moisture convergence and relatively clear skies ahead of the main convective envelope combine with the low thermal inertia of the islands, to allow a rapid response in the diurnal cycle which rectifies onto the lower-frequency MJO. Hence, accurate representations of the diurnal cycle and its scale interaction appear to be necessary for models to simulate the MJO successfully.

The annual-cycle modulation of meridional asymmetry in ENSO’s atmospheric response and its dependence on ENSO zonal structure

Previous studies documented that a distinct southward shift of central-Pacific low-level wind anomalies occurring during the ENSO decaying phase, is caused by an interaction between the Western Pacific annual cycle and El Niño-Southern Oscillation (ENSO) variability. The present study finds that the meridional movement of the central-Pacific wind anomalies appears only during traditional Eastern-Pacific (or EP) El Niño events rather than in Central-Pacific (CP) El Niño events in which sea surface temperature (SST) anomalies are confined to the central Pacific. The zonal structure of ENSO-related SST anomalies therefore has an important effect on meridional asymmetry in the associated atmospheric response and its modulation by the annual cycle. In contrast to EP El Niño events, the SST anomalies of CP El Niño events extend further west towards to the warm pool region with its climatological warm SSTs. In the warm pool region, relatively small SST anomalies thus are able to excite convection anomalies on both sides of the equator, even with a meridionally asymmetric SST background state. Therefore, almost meridionally symmetric precipitation and wind anomalies are observed over the central Pacific during the decaying phase of CP El Niño events. The SST anomaly pattern of La Niña events is similar to CP El Niño events with a reversed sign. Accordingly, no distinct southward displacement of the atmospheric response occurs over the central Pacific during the La Niña decaying phase. These results have important implications for ENSO climate impacts over East Asia, since the anomalous low-level anticyclone over the western North Pacific is an integral part of the annual cycle-modulated ENSO response.

Coordinated ground-based, low altitude satellite and Cluster observations on global and local scales during a transient post-noon sector excursion of the magnetospheric cusp

On 14 January 2001, the four Cluster spacecraft passed through the northern magnetospheric mantle in close conjunction to the EISCAT Svalbard Radar (ESR) and approached the post-noon dayside magnetopause over Greenland between 13:00 and 14:00 UT During that interval, a sudden reorganisation of the high-latitude dayside convection pattern accurred after 13:20 UT most likely caused by a direction change of the Solar wind magnetic field. The result was an eastward and poleward directed flow-channel, as monitored by the SuperDARN radar network and also by arrays of ground-based magnetometers in Canada, Greenland and Scandinavia. After an initial eastward and later poleward expansion of the flow-channel between 13:20 and 13:40 UT, the four Cluster spacecraft, and the field line footprints covered by the eastward looking scan cycle of the Sondre Stromfjord incoherent scatter radar were engulfed by cusp-like precipitation with transient magnetic and electric field signatures. In addition, the EISCAT Svalbard Radar detected strong transient effects of the convection reorganisation, a poleward moving precipitation, and a fast ion flow-channel in association with the auroral structures that suddenly formed to the west and north of the radar. From a detailed analysis of the coordinated Cluster and ground-based data, it was found that this extraordinary transient convection pattern, indeed, had moved the cusp precipitation from its former pre-noon position into the late post-noon sector, allowing for the first and quite unexpected encounter of the cusp by the Cluster spacecraft. Our findings illustrate the large amplitude of cusp dynamics even in response to moderate solar wind forcing. The global ground-based data proves to be an invaluable tool to monitor the dynamics and width of the affected magnetospheric regions.

Survival, Population Size, and Gonotrophic Cycle Duration of Nyssomyia neivai (Diptera: Psychodidae) at an Endemic Area of American Cutaneous Leishmaniasis in Southeastern Brazil

The survival, absolute population size, gonotrophic cycle duration, and temporal and spatial abundance of Nyssomyia neivai (Pinto) were studied in a rural area endemic for American cutaneous leishmaniasis (ACL) in Conchal, Sao Paulo State, southeastern Brazil, using mark-release-recapture techniques and by monitoring population fluctuation. The monthly abundance exhibited a unimodal pattern, with forest and domicile habitats having the highest relative abundances. A total of 1,873 males and 3,557 females were marked and released during the six experiments, of which 4.1-13.0% of males and 4.1-11.8% of females were recaptured. Daily survivorship estimated from the decline in recaptures per day was 0.681 for males and 0.667 for females. Gonotrophic cycle duration was estimated to be 4.0 d. Absolute population size was calculated using the Lincoln Index and ranged from 861 to 4,612 males and from 2,187 to 19,739 females. The low proportion of females that reach the age when they are potentially infective suggests that N. neivai has a low biological capacity to serve as a vector and that factors such as high biting rates and opportunistic feeding behavior would be needed to enable Leishmania (Viannia) braziliensis Vianna transmission. This agreed with the epidemiological pattern of ACL in southeastern Brazil that is characterized by low incidence, with isolated cases acquired principally within domiciliary habitats.

Climatic simulations of the eastern Andes low-level jet and its dependency on convective parameterizations

The South American low level jet (SALLJ) of the Eastern Andes is investigated with Regional Climate Model version 3 (RegCM3) simulations during the 2002-2003 austral summer using two convective parameterizations (Grell and Emanuel). The simulated SALLJ is compared with the special observations of SALLJEX (SALLJ Experiment). Both the Grell and Emanuel schemes adequately simulate the low level flow over South America. However, there are some intensity differences. Due to the larger (smaller) convective activity, the Emanuel (Grell) scheme simulates more intense (weaker) low level wind than analysis in the tropics and subtropics. The objectives criteria of Sugahara (SJ) and Bonner (BJ) were used for LLJ identification. When applied to the observations, both criteria suggest a larger frequency of the SALLJ in Santa Cruz, followed by Mariscal, Trinidad and Asuncin. In Mariscal and Asuncin, the diurnal cycle indicates that SJ occurs mainly at 12 UTCs (morning), while the BJ criterion presents the SALLJ as more homogenously distributed. The concentration into two of the four-times-a-day observations does not allow conclusions about the diurnal cycle in Santa Cruz and Trinidad. The simulated wind profiles result in a lower than observed frequency of SALLJ using both the SJ and BJ criteria, with fewer events obtained with the BJ. Due to the stronger simulated winds, the Emanuel scheme produces an equal or greater relative frequency of SALLJ than the Grell scheme. However, the Grell scheme using the SJ criterion simulates the SALLJ diurnal cycle closer to the observed one. Although some discrepancies between observed and simulated mean vertical profiles of the horizontal wind are noted, there is large agreement between the composites of the vertical structure of the SALLJ, especially when the SJ criterion is used with the Grell scheme. On an intraseasonal scale, a larger southward displacement of SALLJ in February and December when compared with January has been noted. The Grell and Emanuel schemes simulated this observed oscillation in the low-level flow. However, the spatial pattern and intensity of rainfall and circulation anomalies simulated by the Grell scheme are closer to the analyses than those obtained with the Emanuel scheme.