UPDATE 1-Zell sees political risk to investing in U.S.

* Obama critic says US investment climate destabilized

* No major overhang in inventory of multi-family units
(Adds comments by Zell)

By Ros Krasny

BOSTON, April 14 (BestGrowthStock) – The policies of the current
U.S. administration have created “political risk” to investing
in the United States, billionaire real estate investor Sam Zell
said on Wednesday.

Appearing on a panel at the Urban Land Institute’s real
estate summit in Boston, Zell said “what’s going on now is
frightening” and working to undermine confidence, although he
allowed that an economic recovery is under way.

“Up until this administration, you knew the rules and had a
very stable environment,” Zell said.

Never one to mince words, Zell said he saw similarities
that are “a little eerie” between Nero’s Rome and the United
States of 2010.

“I continue to be an optimist about the United States, if
for no other reason than I think we are going to alter the
current political situation,” said Zell, who has been a critic
of President Barack Obama’s policies for some time and was a
major donor to John McCain’s 2008 presidential campaign.

“If the current situation is indicative of the next half
century, I think we’re screwed.”

Zell, who led a 2007 leveraged buyout of media company
Tribune Co (TRBCQ.PK: ) which is now in Chapter 11 protection,
said one of the few real opportunities in U.S. real estate
investing at the moment was in hotels.

“I don’t see any great equity opportunities on the real
estate side in the United States. All of our activities have
been in buying distressed debt in one form or another.”

Still, he said that on the cusp of an economic rebound
there was not a serious inventory overhang of multi-family
units to absorb the potential formation of new households.

“We could eat through that inventory in three or four
months given a strong recovery,” Zell said.

Stock Market Today

(Reporting by Ros Krasny, editing by Matthew Lewis)

UPDATE 1-Zell sees political risk to investing in U.S.