Sen. Reed

Rep. Capuano

By Kyle Fishburn and Allen Kenney

September proved to be an eventful month on Capitol Hill for real estate, as legislators took important steps toward enhancing insurance provisions for terrorism risk.

The House passed its version of the Terrorism Risk Insurance Revisions and Extension Act of 2007 (TRIREA) on September 19 by an overwhelming margin. Among the bill's most important provisions, TRIREA would extend the current terrorism insurance program set to expire at the end of 2007 by 15 years.

Sen. Jack Reed (D-RI) and Rep. Michael Capuano (D-MA) met with members of the U.S. Chamber of Commerce and the Coalition to Insure Against Terrorism (CIAT) the day after TRIREA's passage in the House to discuss the bill's immediate future. The Senate is expected to take up the bill later this year.

The lawmakers both cited a pressing need to give the U.S. business community certainty in the face of ever-changing terrorist threats to the national economy. Capuano and Reed also advocated a lengthened extension that would provide the economy with certainty while a long-term terrorism insurance program is developed.

"This program is essential to our economy," says Reed, who chairs the Senate Banking, Housing and Urban Affairs Subcommittee on Securities, Insurance and Investment.

Both rebuffed the bill's critics, who have argued that the federal government should wait for a solution for insuring against terrorist attacks to develop on the open market, rather than extending the current program. "This is a very difficult insurance product to create and sell," Reed says.

"The general public shouldn't have to worry about this," says Capuano, who sponsored the bill in the House of Representatives.

NAREIT is a member of CIAT, which consists of a wide range of business interests seeking a solution to the dilemma of providing adequate, affordable terrorism risk insurance.

Duke Joins S&P Index Standard & Poor's announced in September that Duke Realty Corp. (NYSE: DRE) would become part of the S&P MidCap 400 index, effective at the close of trading on September 28. The office REIT based in Indianapolis replaces investment banking and brokerage firm AG Edwards Inc. in the index. Wachovia Corp. acquired AG Edwards at the close of September, precipitating Duke's addition to the index. The S&P MidCap 400 is the most widely used index for U.S. mid-sized companies. A team of economists and index analysts from Standard & Poor's maintain the index to make sure that it is reflective of the greater mid-sized market.

Out with the Archstone, in with the BRE Cohen & Steers announced in early October that it plan-ned to replace Archstone-Smith Trust in its Realty Majors Portfolio Index (RMP) with another U.S. apartment REIT, BRE Properties (NYSE: BRE). The Tishman Speyer Group and Lehman Brothers were poised to finalize their joint acquisition of Archstone-Smith on October 5. At that time, BRE was slated to join the RMP, while Archstone-Smith would be removed, according to a release from Cohen & Steers.