10 ways to make real money

Commercial real estate values are down sharply from their peak, suggesting there are great bargains in distressed office, retail and other space. Trouble is, you can't easily buy these properties and the standard way to invest, via real estate investment trusts, is no bargain: Since March 2009, REITs have shot up 146%.

How to invest: Enter Third Avenue Real Estate Value. While most real estate mutual funds invest primarily in U.S. REITs, manager Michael Winer also buys developers -- both their stocks and their bonds -- here and abroad. Winer keeps a hit list and generally waits for a target to fall about 25% below his estimate of fair value. And lately he's been buying, especially in Europe. "About 25% of our portfolio was in cash at the end of April because we weren't finding excellent bargains, but now cash is down to about 15%," says Jason Wolf, a senior analyst at the fund.

What could go wrong: If the global downturn in real estate is deeper than expected, Winer's picks may take years to pay off, and you won't have as much dividend income as REITs throw off to cushion returns.

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