T. Rowe Price Real Estate Fund (TRREX) N-CSR/A Certified annual shareholder report (management investment company) (amended)

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM N-CSR

CERTIFIED SHAREHOLDER REPORT OF REGISTERED

MANAGEMENT INVESTMENT COMPANIES

Investment Company Act File Number: 811-08371

T. Rowe Price Real Estate Fund, Inc.

(Exact name of registrant as specified in charter)

100 East Pratt Street, Baltimore, MD 21202

(Address of principal executive offices)

David Oestreicher

100 East Pratt Street, Baltimore, MD 21202

(Name and address of agent for service)

Registrant’s telephone number, including area code: (410) 345-2000

Date of fiscal year end: December 31

Date of reporting period: December 31, 2022

Reason for filing form N-CSR/A: The following amends the N-CSR originally filed on February 23, 2023 (SEC Accession No. 0001193125-23-046122). The purpose of this filing is to correct the date on the audit opinion letter.

Item 1. Reports to Shareholders

(a) Report pursuant to Rule 30e-1

Highlights

and

Market

Commentary

Management’s

Discussion

of

Fund

Performance

Performance

and

Expenses

Financial

Highlights

Portfolio

of

Investments

Financial

Statements

and

Notes

Additional

Fund

Information

December

31,

2022

Annual

Report

For

more

insights

from

T.

Rowe

Price

investment

professionals,

go

to

troweprice.com

.

T.

ROWE

PRICE

TRREX

Real

Estate

Fund

–

.

PAREX

Real

Estate

Fund–

.

Advisor  Class

TIRRX

Real

Estate

Fund–

.

I Class

T.

ROWE

PRICE

Real

Estate

Fund

HIGHLIGHTS

The

Real

Estate

Fund

produced

negative

results

in

2022

during

a

difficult

environment

for

the

real

estate

sector.

The

fund

trailed

its

benchmark

and

performed

in

line

with

its

Lipper

peer

group

index.

A

lack

of

exposure

to

triple

net

real

estate

weighed

on

the

portfolio’s

relative

results,

while

our

positioning

in

the

data

centers

sector

aided

performance.

The

fund’s

largest

positions

are

in

apartment/residential,

infrastructure,

and

industrial

real

estate

stocks,

which

made

up

over

half

of

the

portfolio

at

the

end

of

the

period.

Although

real

estate

companies

face

some

headwinds

in

2023,

demand

for

commercial

and

residential

real

estate

has

thus

far

remained

resilient

and

valuations

in

the

sector

have

improved.

Log

in

to

your

account

at

troweprice.com

for

more

information.

*

Certain

mutual

fund

accounts

that

are

assessed

an

annual

account

service

fee

can

also

save

money

by

switching

to

e-delivery.

T.

ROWE

PRICE

Real

Estate

Fund

Market

Commentary

1

Dear

Shareholder

Nearly

all

major

global

stock

and

bond

indexes

fell

sharply

in

2022,

as

investors

contended

with

persistently

high

inflation,

tightening

financial

conditions,

and

slowing

economic

and

corporate

earnings

growth.

Double-digit

losses

were

common

in

equity

markets

around

the

world,

and

bond

investors

also

faced

a

historically

tough

environment

amid

a

sharp

rise

in

interest

rates.

Value

shares

declined

but

outperformed

growth

stocks

by

a

considerable

margin

as

equity

investors

turned

risk

averse

and

as

rising

rates

put

downward

pressure

on

growth

stock

valuations.

Emerging

markets

stocks

generally

underperformed

shares

in

developed

markets.

Meanwhile,

the

U.S.

dollar

strengthened

versus

most

currencies

during

the

period,

which

weighed

on

returns

for

U.S.

investors

in

international

securities.

Within

the

S&P

500

Index,

energy

was

a

rare

bright

spot,

gaining

more

than

60%

as

oil

prices

jumped

in

response

to

Russia’s

invasion

of

Ukraine

and

concerns

over

commodity

supply

shortages.

Defensive

shares,

such

as

utilities,

consumer

staples,

and

health

care,

held

up

relatively

well

and

finished

the

year

with

roughly

flat

returns.

Conversely,

communication

services,

consumer

discretionary,

and

information

technology

shares

suffered

the

largest

declines.

Elevated

inflation

remained

a

leading

concern

for

investors

throughout

the

period,

although

there

were

signs

that

price

increases

were

moderating

by

year-

end.

November’s

consumer

price

index

data

showed

headline

inflation

rising

7.1%

on

a

12-month

basis,

the

lowest

level

since

December

2021

but

still

well

above

the

Federal

Reserve’s

2%

long-term

target.

In

response

to

the

high

inflation

readings,

global

central

banks

tightened

monetary

policy,

and

investors

focused

on

communications

from

central

bank

officials

on

how

high

rates

would

have

to

go.

The

Fed,

which

at

the

end

of

2021

had

forecast

that

it

would

only

need

to

raise

interest

rates

0.75

percentage

point

in

all

of

2022,

raised

its

short-term

lending

benchmark

from

near

zero

in

March

to

a

target

range

of

4.25%

to

4.50%

by

December

and

indicated

that

additional

hikes

are

likely.

Bond

yields

increased

considerably

across

the

U.S.

Treasury

yield

curve

as

the

Fed

tightened

monetary

policy,

with

the

yield

on

the

benchmark

10-year

U.S.

Treasury

note

climbing

from

1.52%

at

the

start

of

the

period

to

3.88%

at

the

end

of

the

year.

Significant

inversions

in

the

yield

curve,

which

are

often

considered

a

warning

sign

of

a

coming

recession,

occurred

during

the

period

as

shorter-maturity

Treasuries

experienced

the

largest

yield

increases.

The

T.

ROWE

PRICE

Real

Estate

Fund

2

sharp

increase

in

yields

led

to

historically

weak

results

across

the

fixed

income

market,

with

the

Bloomberg

U.S.

Aggregate

Bond

Index

delivering

its

worst

year

on

record.

(Bond

prices

and

yields

move

in

opposite

directions.)

As

the

period

came

to

an

end,

the

economic

backdrop

appeared

mixed.

Although

manufacturing

gauges

have

drifted

toward

contraction

levels,

the

U.S.

jobs

market

remained

resilient,

and

corporate

and

household

balance

sheets

appeared

strong.

Meanwhile,

the

housing

market

has

weakened

amid

rising

mortgage

rates.

The

past

year

has

been

a

trying

time

for

investors

as

few

sectors

remained

untouched

by

the

broad

headwinds

that

markets

faced,

and

volatility

may

continue

in

the

near

term

as

central

banks

tighten

policy

amid

slowing

economic

growth.

However,

in

our

view,

there

continue

to

be

opportunities

for

selective

investors

focused

on

fundamentals.

Valuations

in

most

global

equity

markets

have

improved

markedly,

although

U.S.

equities

still

appear

relatively

expensive

by

historical

standards,

while

bond

yields

have

reached

some

of

the

most

attractive

levels

since

the

2008

global

financial

crisis.

We

believe

this

environment

makes

skilled

active

management

a

critical

tool

for

identifying

risks

and

opportunities,

and

our

investment

teams

will

continue

to

use

fundamental

research

to

identify

securities

that

can

add

value

to

your

portfolio

over

the

long

term.

Thank

you

for

your

continued

confidence

in

T.

Rowe

Price.

Sincerely, 

Robert

Sharps

CEO

and

President

T.

ROWE

PRICE

Real

Estate

Fund

Management’s

Discussion

of

Fund

Performance

3

INVESTMENT

OBJECTIVE 

The

fund

seeks

to

provide

long-term

growth

through

a

combination

of

capital

appreciation

and

current

income.

FUND

COMMENTARY

How

did

the

fund

perform

in

the

past 12

months?

The

Real

Estate

Fund

returned

-25.84%

for

the

12

months

ended

December

31,

2022.

The

fund

underperformed

its

benchmark,

the

FTSE

NAREIT

All

Equity

REITs

Index,

but

performed

in

line

with

its

Lipper

peer

group.

Effective

May

1,

2022,

the

primary

benchmark

for

the

Real

Estate

Fund

changed

from

the

Wilshire

U.S.

Real

Estate

Securities

Index

to

the

FTSE

NAREIT

All

Equity

REITs

Index.

(Returns

for

the

Advisor

and

I

Class

shares

varied

slightly,

reflecting

their

different

fee

structures.

Past

performance

cannot

guarantee

future

results.

)

On

December

14,

2022,

your

fund’s

Board

of

Directors

declared

a

fourth-

quarter

dividend

of

$0.099

per

share

to

shareholders

of

record

on

that

day,

which

was

paid

on

December

16

(distributions

may

vary

for

the

fund’s

Advisor

and

I

Class

shares).

You

should

have

received

your

check

or

statement

reflecting

this

distribution.

This

brings

total

distributions

for

the

year

to

$0.3189

per

share;

however,

a

portion

of

this

amount

has

been

reclassified

as

capital

gains

for

tax

purposes.

Please

remember

to

use

your

IRS

Form

1099-

DIV,

not

your

year-end

T.

Rowe

Price

account

statement,

for

tax

filing

purposes

in

order

to

accurately

reflect

the

reclassification

of

a

portion

of

the

fund’s

income

distribution.

PERFORMANCE

COMPARISON

Total

Return

Periods

Ended

12/31/22

6

Months

12

Months

Real

Estate

Fund

–

.

-7.00‌%

-25.84‌%

Real

Estate

Fund–

.

Advisor  Class

-7.14‌

-26.05‌

Real

Estate

Fund–

.

I  Class

-6.96‌

-25.76‌

FTSE

NAREIT

All

Equity

REITs

Index

-7.14‌

-24.95‌

Wilshire

U.S.

Real

Estate

Securities

Index

-6.53‌

-26.75‌

Lipper

Real

Estate

Funds

Index

-6.83‌

-25.93‌

T.

ROWE

PRICE

Real

Estate

Fund

4

What

factors

influenced

the

fund’s

performance?

Real

estate

stocks

delivered

negative

results

during

the

12-month

period

and

underperformed

the

broader

U.S.

equity

market.

Overall,

stocks

fell

sharply

as

the

Federal

Reserve

aggressively

raised

interest

rates

to

curb

the

highest

inflation

in

four

decades.

Within

the

real

estate

benchmark,

performance

was

negative

for

all

property

types,

although

returns

varied

widely.

Generally,

sectors

with

greater

exposure

to

risks

from

rising

interest

rates,

higher

inflation,

or

a

weakening

growth

picture

faced

headwinds.

The

office,

apartment/residential,

and

infrastructure

sectors

performed

the

worst,

while

lodging/leisure,

triple

net

real

estate,

and

shopping

centers

fared

the

best.

Our

lack

of

exposure

to

triple

net

real

estate,

where

leaseholders

pay

maintenance,

insurance,

and

taxes,

was

the

largest

detractor

from

the

fund’s

relative

performance

as

the

higher-yielding

sector

significantly

outperformed

the

benchmark

in

a

rising

rate

environment.

The

assets

were

also

looked

at

favorably

during

this

period

as

triple

net

owners

have

some

protection

against

rising

expenses

despite

relatively

stagnant

rent

growth.

Stock

selection

and

an

overweight

in

industrial

real

estate

also

detracted.

Our

positions

in

EastGroup

Properties

and

Rexford

Industrial

suffered

losses

on

the

news

that

Amazon

would

slow

down

its

pace

of

new

warehouse

leasing.

(Please

refer

to

the

fund’s

portfolio

of

investments

for

a

complete

list

of

holdings

and

the

amount

each

represents

in

the

portfolio.)

Our

overweight

to

the

apartment/residential

sector

also

weighed

on

relative

results.

Essex

Property

Trust

and

AvalonBay

Communities

underperformed

as

concerns

about

the

impact

of

layoffs

and

a

weakening

job

market

on

apartment

demand

started

to

emerge

in

some

cities.

On

the

positive

side,

stock

selection

and

an

underweight

in

the

data

center

sector

added

to

our

relative

results.

Equinix,

a

leading

retail

colocation

data

center

operator

and

our

only

holding

in

the

sector,

significantly

outperformed

Digital

Realty,

which

we

do

not

own.

Equinix

reported

better-than-expected

earnings,

and

management

guidance

indicated

that

demand

remains

strong.

Effective

May

1,

2022,

the

primary

benchmark

for

the

Real

Estate

Fund

changed

from

the

Wilshire

U.S.

Real

Estate

Securities

Index

to

the

FTSE

NAREIT

All

Equity

REITs

Index.

Concurrent

with

this

change

and

throughout

the

second

quarter,

we

increased

our

exposure

to

the

infrastructure

segment.

The

purchases

proved

to

be

well

timed

and

contributed

to

our

relative

performance

in

the

second

half

of

the

year.

T.

ROWE

PRICE

Real

Estate

Fund

5

An

underweight

allocation

in

the

first

half

and

an

overweight

in

the

second

half

of

the

year

to

regional

malls

also

contributed

to

results.

Simon

Property

Group

performed

well

later

in

the

year

as

consumer

spending

remained

strong

and

occupancy

levels

at

its

properties

increased

more

than

expected.

How

is

the

fund

positioned?

As

shown

in

the

Industry

Diversification

chart,

our

largest

positions

are

in

apartment/residential,

infrastructure,

and

industrial

stocks,

which

made

up

over

half

of

the

portfolio

at

the

end

of

the

period.

Our

industry

weightings

are

largely

determined

by

our

bottom-up

approach

to

stock

selection.

The

fund

retained

a

significant

investment

and

overweight

in

apartment

and

residential

real

estate

investment

trusts

(REITs).

Following

strong

relative

and

absolute

performance

early

in

the

period,

we

trimmed

our

investments

in

apartment

REITs

Camden

Property

Trust

and

Equity

Residential.

With

the

proceeds,

we

added

to

our

position

in

American

Homes

4

Rent,

which

is

focused

on

single-family

home

rentals.

We

believe

a

lack

of

housing

supply

should

drive

continued

strength

in

single-family

rental

rates,

and

we

like

the

sector’s

relatively

defensive

characteristics.

As

noted

earlier,

in

concurrence

with

the

benchmark

change,

we

increased

our

allocation

to

cell

tower

companies

within

the

infrastructure

sector

during

the

first

half

of

the

year.

We

believe

cell

tower

companies

have

attractive

business

models

in

that

each

individual

tower

has

strong

pricing

power

over

its

coverage

area

due

to

strict

zoning

rules.

The

fund

remained

overweight

industrial

real

estate

as

we

continue

to

have

a

positive

outlook

for

the

fundamental

results

in

the

sector.

We

added

to

our

position

in

Prologis

following

underperformance

during

the

second

half

of

the

year.

We

initiated

a

position

in

timber

company

Weyerhaeuser

as

valuations

appeared

attractive

following

fears

around

a

slowing

housing

market.

We

believe

that

Weyerhaeuser’s

timber

assets

should

provide

steady

and

growing

cash

flows.

In

healthcare,

we

adjusted

our

position

in

Welltower

as

the

stock

price

fluctuated.

We

also

added

to

our

position

in

Ventas,

a

diversified

healthcare

REIT

that

owns

senior

housing,

medical

office,

and

life

science

properties.

We

partially

funded

the

position

by

exiting

a

longtime

holding

in

Healthcare

Realty

Trust

after

it

made

a

large

acquisition.

In

the

lodging

sector,

we

initiated

a

position

in

InterContinental

Hotels

and

added

to

our

existing

investment

in

Hilton

Worldwide

Holdings.

We

trimmed

Apple

Hospitality

REIT

to

fund

these

purchases.

T.

ROWE

PRICE

Real

Estate

Fund

6

What

is

portfolio

management’s

outlook?

Real

estate

companies

face

several

headwinds

as

we

move

into

2023.

Rent

growth

is

slowing

from

very

high

levels,

although

it

is

likely

to

remain

positive

in

most

property

types

and

markets.

Key

expense

categories

like

real

estate

taxes,

insurance,

payroll,

and

utilities

are

increasing

at

an

above-

average

rate

relative

to

history.

In

addition,

higher

interest

rates

will

increase

financing

costs

for

the

companies

that

we

invest

in,

crimping

earnings

growth,

although

this

will

happen

slowly

over

several

years.

Lastly,

higher

interest

rates

put

upward

pressure

on

capitalization

rates

and,

therefore,

downward

pressure

on

valuations.

In

the

private

real

estate

market,

where

more

financial

leverage

and

variable

rate

financing

is

used,

we

expect

that

there

may

be

instances

of

forced

selling

and

markdowns

to

asset

values.

Fortunately,

we

also

see

offsetting

positives

for

the

industry

looking

forward.

Higher

interest

rates

combined

with

high

construction

replacement

costs

will

likely

disincentivize

developers

from

building

new

properties.

Thus,

we

should

see

less

competing

supply

coming

into

the

market

in

2024

and

2025.

In

addition,

demand

for

commercial

and

residential

real

estate

has

thus

far

remained

resilient,

particularly

in

the

hotel,

self-storage,

residential,

and

industrial

warehouses

sectors.

INDUSTRY

DIVERSIFICATION

Percent

of

Net

Assets

6/30/22

12/31/22

Apartment/Residential

23.0‌%

20.0‌%

Infrastructure

16.9‌ 

15.9‌ 

Industrial

15.3‌ 

15.8‌ 

Self-Storage

10.1‌ 

9.1‌ 

Healthcare

9.0‌ 

7.8‌ 

Shopping

Centers

4.9‌ 

6.3‌ 

Data

Centers

5.6‌ 

6.2‌ 

Lodging/Leisure

6.2‌ 

6.0‌ 

Regional

Malls

2.6‌ 

4.6‌ 

Office

3.8‌ 

2.9‌ 

Agriculture/Land

1.2‌ 

2.4‌ 

Diversified

0.8‌ 

0.5‌ 

Other

and

Reserves

0.6‌ 

2.5‌ 

Total

100.0‌%

100.0‌%

Historical

weightings

reflect

current

industry/sector

classifications.

T.

ROWE

PRICE

Real

Estate

Fund

7

Also

importantly,

while

drawdowns

in

the

stock

market

are

never

desired,

valuations

for

our

opportunity

set

of

real

estate

stocks

have

improved.

The

fears

prevalent

in

the

market

around

a

recession

and

the

headwinds

noted

above

are,

to

at

least

some

degree,

already

reflected

in

real

estate

stock

valuations.

We

also

believe

that

falling

inflation

figures

are

likely

throughout

2023,

which

should

take

pressure

off

the

Fed

to

continue

its

hiking

path.

We

remain

focused

on

investing

in

companies

that

own

well-located

real

estate,

meaning

demand

exceeds

supply

over

a

sustainable

time

period.

This

remains

critical

to

our

philosophy

as

rent

growth

is

needed

to

combat

the

headwind

from

higher

interest

rates.

In

addition,

our

portfolio

remains

invested

in

companies

with

below-average

financial

leverage

and

ample

liquidity

that

we

believe

have

the

ability

to

take

advantage

of

any

dislocations

in

the

private

real

estate

market.

As

a

result,

we

are

optimistic

on

the

return

potential

for

our

portfolio

of

real

estate

companies

going

forward.

The

views

expressed

reflect

the

opinions

of

T.

Rowe

Price

as

of

the

date

of

this

report

and

are

subject

to

change

based

on

changes

in

market,

economic,

or

other

conditions.

These

views

are

not

intended

to

be

a

forecast

of

future

events

and

are

no

guarantee

of

future

results.

T.

ROWE

PRICE

Real

Estate

Fund

8

Risks

of

Investing

The

fund’s

share

price

can

fall

because

of

weakness

in

the

stock

market,

a

particular

industry,

or

specific

holdings.

Stock

markets

can

decline

for

many

reasons,

including

adverse

political

or

economic

developments,

changes

in

investor

psychology,

or

heavy

institutional

selling.

The

prospects

for

an

industry

or

company

may

deteriorate

because

of

a

variety

of

factors,

including

disappointing

earnings

or

changes

in

the

competitive

environment.

In

addition,

the

investment

manager’s

assessment

of

companies

held

in

a

fund

may

prove

incorrect,

resulting

in

losses

or

poor

performance

even

in

rising

markets.

Funds

that

invest

only

in

specific

industries

will

experience

greater

volatility

than

funds

investing

in

a

broad

range

of

industries.

Due

to

its

concentration

in

the

real

estate

industry,

the

fund’s

share

price

could

be

more

volatile

than

that

of

a

fund

with

a

broader

investment

mandate.

Trends

perceived

to

be

unfavorable

to

real

estate,

such

as

changes

in

the

tax

laws

or

rising

interest

rates,

could

cause

a

decline

in

share

prices.

BENCHMARK

INFORMATION

Note:

FTSE

is

a

trademark

of

the

LSE

Group

and

is

used

by

FTSE

International

Limited

("FTSE")

under

license.

"NAREIT"

is

a

trademark

of

the

Nareit.

All

rights

in

the

FTSE

NAREIT

All

Equity

REITs

Index

(the

“Index”)

vest

in

FTSE

and

Nareit.

Neither

FTSE,

nor

the

LSE

Group,

nor

Nareit

accept

any

liability

for

any

errors

or

omissions

in

the

indexes

or

data

and

no

party

may

rely

on

any

indexes

or

data

contained

in

this

communication.

No

further

distribution

of

data

from

the

FTSE

or

Nareit

is

permitted

without

the

relevant

FTSE’s

express

written

consent.

FTSE,

the

LSE

Group,

and

Nareit

do

not

promote,

sponsor

or

endorse

the

content

of

this

communication.

Note:

Portions

of

the

mutual

fund

information

contained

in

this

report

was

supplied

by

Lipper,

a

Refinitiv

Company,

subject

to

the

following:

Copyright

2023

©

Refinitiv.

All

rights

reserved.

Any

copying,

republication

or

redistribution

of

Lipper

content

is

expressly

prohibited

without

the

prior

written

consent

of

Lipper.

Lipper

shall

not

be

liable

for

any

errors

or

delays

in

the

content,

or

for

any

actions

taken

in

reliance

thereon.

Note:

The

Wilshire

Indexes

SM

and

Wilshire

Atlas

SM

have

been

licensed

for

use

by

T.

Rowe

Price

and

all

content

is

©

2023

Wilshire

Associates

Incorporated.

All

rights

reserved.

T.

ROWE

PRICE

Real

Estate

Fund

9

PORTFOLIO

HIGHLIGHTS

TWENTY-FIVE

LARGEST

HOLDINGS

Percent

of

Net

Assets

12/31/22

American

Tower

7.7‌%

Prologis

6.9‌ 

Equinix

6.2‌ 

Public

Storage

5.6‌ 

Equity

LifeStyle

Properties

5.5‌ 

SBA

Communications

4.7‌

Simon

Property

Group

4.5‌

Regency

Centers

3.5‌

Crown

Castle

3.5‌

Welltower

3.4‌

Rexford

Industrial

Realty

3.3‌

Essex

Property

Trust

3.2‌

Alexandria

Real

Estate

Equities

3.1‌

AvalonBay

Communities

3.0‌

Equity

Residential

3.0‌

EastGroup

Properties

2.8‌

Terreno

Realty

2.7‌

CubeSmart

2.4‌

American

Homes

4

Rent

2.4‌

Camden

Property

Trust

2.3‌

Apple

Hospitality

REIT

1.9‌

Hilton

Worldwide

Holdings

1.5‌

Rayonier

1.5‌

Ventas

1.4‌

Acadia

Realty

Trust

1.4‌

Total

87.4‌%

Note:

The

information

shown

does

not

reflect

any

exchange-traded

funds

(ETFs),

cash

reserves,

or

collateral

for

securities

lending

that

may

be

held

in

the

portfolio.

T.

ROWE

PRICE

Real

Estate

Fund

10

GROWTH

OF

$10,000 

This

chart

shows

the

value

of

a

hypothetical

$10,000

investment

in

the

fund

over

the

past

10

fiscal

year

periods

or

since

inception

(for funds

lacking

10-year

records).

The

result

is

compared

with

benchmarks,

which

include

a

broad-based

market

index

and

may

also

include

a

peer

group

average

or

index.

Market

indexes

do

not

include

expenses,

which

are

deducted

from

fund returns

as

well

as

mutual fund

averages

and

indexes.

REAL

ESTATE

FUND 

Note:

Performance

for

the Advisor

and

I Class

shares

will

vary

due

to

their

differing

fee

structures.

See

the

Average

Annual

Compound

Total

Return

table. 

T.

ROWE

PRICE

Real

Estate

Fund

11

AVERAGE

ANNUAL

COMPOUND

TOTAL

RETURN

Periods

Ended

12/31/22

1

Year

5

Years

10

Years

Since

Inception

Inception

Date

Real

Estate

Fund

–

.

-25.84‌%

1.52‌%

5.30‌%

–‌

–

Real

Estate

Fund–

.

Advisor  Class

-26.05‌

1.25‌

5.03‌

–‌

–

Real

Estate

Fund–

.

I  Class

-25.76‌

1.68‌

–‌

2.82‌%

12/17/15

The

fund’s

performance

information

represents

only

past

performance

and

is

not

necessarily

an

indication

of

future

results.

Current

performance

may

be

lower

or

higher

than

the

performance

data

cited.

Share

price,

principal

value,

and

return

will

vary,

and

you

may

have

a

gain

or

loss

when

you

sell

your

shares.

For

the

most

recent

month-end

performance,

please

visit

our

website

(troweprice.com)

or

contact

a

T.

Rowe

Price

representative

at

1

-

800

-

225

-

5132

or,

for

0.02

Advisor

and

0.03

I

Class

shares,

1-800-638-8790.

This

table

shows

how

the

fund

would

have

performed

each

year

if

its

actual

(or

cumulative)

returns

had

been

earned

at

a

constant

rate.

Average

annual

total

return

figures

include

changes

in

principal

value,

reinvested

dividends,

and

capital

gain

distributions.

Returns

do

not

reflect

taxes

that

the

shareholder

may

pay

on

fund

distributions

or

the

redemption

of

fund

shares.

When

assessing

performance,

investors

should

consider

both

short-

and

long-term

returns.

T.

ROWE

PRICE

Real

Estate

Fund

12

EXPENSE

RATIO

FUND

EXPENSE

EXAMPLE

As

a

mutual

fund

shareholder,

you

may

incur

two

types

of

costs:

(1)

transaction

costs,

such

as

redemption

fees

or

sales

loads,

and

(2)

ongoing

costs,

including

management

fees,

distribution

and

service

(12b-1)

fees,

and

other

fund

expenses.

The

following

example

is

intended

to

help

you

understand

your

ongoing

costs

(in

dollars)

of

investing

in

the

fund

and

to

compare

these

costs

with

the

ongoing

costs

of

investing

in

other

mutual

funds.

The

example

is

based

on

an

investment

of

$1,000

invested

at

the

beginning

of

the

most

recent

six-month

period

and

held

for

the

entire

period.

Please

note

that

the

fund

has

three

share

classes:

The

original

share

class

(Investor

Class)

charges

no

distribution

and

service

(12b-1)

fee,

the

Advisor

Class

shares

are

offered

only

through

unaffiliated

brokers

and

other

financial

intermediaries

and

charge

a

0.25%

12b-1

fee,

and

I

Class

shares

are

available

to

institutionally

oriented

clients

and

impose

no

12b-1

or

administrative

fee

payment.

Each

share

class

is

presented

separately

in

the

table.

Actual

Expenses

The

first

line

of

the

following

table

(Actual)

provides

information

about

actual

account

values

and

expenses

based

on

the

fund’s

actual

returns.

You

may

use

the

information

on

this

line,

together

with

your

account

balance,

to

estimate

the

expenses

that

you

paid

over

the

period.

Simply

divide

your

account

value

by

$1,000

(for

example,

an

$8,600

account

value

divided

by

$1,000

=

8.6),

then

multiply

the

result

by

the

number

on

the

first

line

under

the

heading

“Expenses

Paid

During

Period”

to

estimate

the

expenses

you

paid

on

your

account

during

this

period.

Hypothetical

Example

for

Comparison

Purposes

The

information

on

the

second

line

of

the

table

(Hypothetical)

is

based

on

hypothetical

account

values

and

expenses

derived

from

the

fund’s

actual

expense

ratio

and

an

assumed

5%

per

year

rate

of

return

before

expenses

(not

the

fund’s

actual

return).

You

may

compare

the

ongoing

costs

of

investing

in

the

fund

with

other

funds

by

contrasting

this

5%

hypothetical

example

and

the

5%

hypothetical

examples

that

appear

in

the

shareholder

reports

of

the

other

funds.

The

hypothetical

account

values

and

expenses

may

not

be

used

to

estimate

the

actual

ending

account

balance

or

expenses

you

paid

for

the

period.

Real

Estate

Fund

0.77‌%

Real

Estate

Fund–Advisor

Class

1.06‌ 

Real

Estate

Fund–I

Class

0.61‌ 

The

expense

ratio

shown

is

as

of

the

fund’s

most

recent

prospectus.

This

number

may

vary

from

the

expense

ratio

shown

elsewhere

in

this

report

because

it

is

based

on

a

different

time

period

and,

if

applicable,

includes

acquired

fund

fees

and

expenses

but

does

not

include

fee

or

expense

waivers.

T.

ROWE

PRICE

Real

Estate

Fund

13

Note:

T.

Rowe

Price

charges

an

annual

account

service

fee

of

$20,

generally

for

accounts

with

less

than

$10,000.

The

fee

is

waived

for

any

investor

whose

T.

Rowe

Price

mutual

fund

accounts

total

$50,000

or

more;

accounts

electing

to

receive

electronic

delivery

of

account

statements,

transaction

confirmations,

prospectuses,

and

shareholder

reports;

or

accounts

of

an

investor

who

is

a

T.

Rowe

Price

Personal

Services

or

Enhanced

Personal

Services

client

(enrollment

in

these

programs

generally

requires

T.

Rowe

Price

assets

of

at

least

$250,000).

This

fee

is

not

included

in

the

accompanying

table.

If

you

are

subject

to

the

fee,

keep

it

in

mind

when

you

are

estimating

the

ongoing

expenses

of

investing

in

the

fund

and

when

comparing

the

expenses

of

this

fund

with

other

funds.

You

should

also

be

aware

that

the

expenses

shown

in

the

table

highlight

only

your

ongoing

costs

and

do

not

reflect

any

transaction

costs,

such

as

redemption

fees

or

sales

loads.

Therefore,

the

second

line

of

the

table

is

useful

in

comparing

ongoing

costs

only

and

will

not

help

you

determine

the

relative

total

costs

of

owning

different

funds.

To

the

extent

a

fund

charges

transaction

costs,

however,

the

total

cost

of

owning

that

fund

is

higher.

REAL

ESTATE

FUND

Beginning

Account

Value

7/1/22

Ending

Account

Value

12/31/22

Expenses

Paid

During

Period*

7/1/22

to

12/31/22

Investor

Class

Actual

$1,000.00

$930.00

$4.09

Hypothetical

(assumes

5%

return

before

expenses)

 1,000.00

  1,020.97

  4.28

Advisor

Class

Actual

  1,000.00

  928.60

  5.35

Hypothetical

(assumes

5%

return

before

expenses)

 1,000.00

  1,019.66

  5.60

I

Class

Actual

  1,000.00

  930.40

  3.11

Hypothetical

(assumes

5%

return

before

expenses)

 1,000.00

  1,021.98

  3.26

*

Expenses

are

equal

to

the

fund’s

annualized

expense

ratio

for

the

6-month

period,

multiplied

by

the

average

account

value

over

the

period,

multiplied

by

the

number

of

days

in

the

most

recent

fiscal

half

year

(184),

and

divided

by

the

days

in

the

year

(365)

to

reflect

the

half-year

period.

The

annualized

expense

ratio

of

the

1

Investor

Class

was

0.84%,

the

2

Advisor Class

was

1.10%,

and

the

3

I Class

was

0.64%.

FUND

EXPENSE

EXAMPLE

(CONTINUED)

T.

ROWE

PRICE

Real

Estate

Fund

Financial

Highlights

14

For

a

share

outstanding

throughout

each

period

The

accompanying

notes

are

an

integral

part

of

these

financial

statements.

Investor

Class

..

Year

..

..

Ended

.

12/31/22

12/31/21

12/31/20

12/31/19

12/31/18

NET

ASSET

VALUE

Beginning

of

period

$

20.17‌

$

15.93‌

$

25.70‌

$

24.78‌

$

28.70‌

Investment

activities

Net

investment

income

(1)(2)

0.22‌

0.21‌

0.29‌

0.47‌

0.47‌

Net

realized

and

unrealized

gain/

loss

(5.33‌)

7.14‌

(3.38‌)

4.98‌

(2.97‌)

Total

from

investment

activities

(5.11‌)

7.35‌

(3.09‌)

5.45‌

(2.50‌)

Distributions

Net

investment

income

(0.22‌)

(0.36‌)

(0.53‌)

(0.75‌)

(0.49‌)

Net

realized

gain

(2.84‌)

(2.75‌)

(6.15‌)

(3.78‌)

(0.93‌)

Total

distributions

(3.06‌)

(3.11‌)

(6.68‌)

(4.53‌)

(1.42‌)

NET

ASSET

VALUE

End

of

period

$

12.00‌

$

20.17‌

$

15.93‌

$

25.70‌

$

24.78‌

Ratios/Supplemental

Data

Total

return

(2)(3)

(25.84‌)%

47.21‌%

(11.38‌)%

22.47‌%

(8.99‌)%

Ratios

to

average

net

assets:

(2)

Gross

expenses

before

waivers/

payments

by

Price

Associates

0.82‌%

0.77‌%

0.78‌%

0.77‌%

0.78‌%

Net

expenses

after

waivers/

payments

by

Price

Associates

0.82‌%

0.77‌%

0.78‌%

0.77‌%

0.78‌%

Net

investment

income

1.27‌%

1.08‌%

1.38‌%

1.65‌%

1.73‌%

Portfolio

turnover

rate

35.5‌%

20.0‌%

18.0‌%

9.4‌%

4.0‌%

Net

assets,

end

of

period

(in

millions)

$759

$1,532

$1,109

$2,011

$3,084

0‌%

0‌%

0‌%

0‌%

0‌%

(1)

Per

share

amounts

calculated

using

average

shares

outstanding

method.

(2)

See

Note

5

for

details

of

expense-related

arrangements

with

Price

Associates.

(3)

Total

return

reflects

the

rate

that

an

investor

would

have

earned

on

an

investment

in

the

fund

during

each

period,

assuming

reinvestment

of

all

distributions,

and

payment

of

no

redemption

or

account

fees,

if

applicable.

T.

ROWE

PRICE

Real

Estate

Fund

Financial

Highlights

15

For

a

share

outstanding

throughout

each

period

Advisor

Class

..

Year

..

..

Ended

.

12/31/22

12/31/21

12/31/20

12/31/19

12/31/18

NET

ASSET

VALUE

Beginning

of

period

$

20.74‌

$

16.31‌

$

26.13‌

$

25.13‌

$

29.07‌

Investment

activities

Net

investment

income

(1)(2)

0.18‌

0.16‌

0.34‌

0.43‌

0.40‌

Net

realized

and

unrealized

gain/

loss

(5.48‌)

7.32‌

(3.54‌)

5.03‌

(3.00‌)

Total

from

investment

activities

(5.30‌)

7.48‌

(3.20‌)

5.46‌

(2.60‌)

Distributions

Net

investment

income

(0.18‌)

(0.30‌)

(0.47‌)

(0.68‌)

(0.41‌)

Net

realized

gain

(2.84‌)

(2.75‌)

(6.15‌)

(3.78‌)

(0.93‌)

Total

distributions

(3.02‌)

(3.05‌)

(6.62‌)

(4.46‌)

(1.34‌)

Redemption

fees

added

to

paid-in

capital

(1)(3)

—‌

—‌

—‌

—‌

(4)

—‌

(4)

NET

ASSET

VALUE

End

of

period

$

12.42‌

$

20.74‌

$

16.31‌

$

26.13‌

$

25.13‌

T.

ROWE

PRICE

Real

Estate

Fund

Financial

Highlights

16

For

a

share

outstanding

throughout

each

period

The

accompanying

notes

are

an

integral

part

of

these

financial

statements.

Advisor

Class

..

Year

..

..

Ended

.

12/31/22

12/31/21

12/31/20

12/31/19

12/31/18

Ratios/Supplemental

Data

Total

return

(2)(5)

(26.05‌)%

46.83‌%

(11.67‌)%

22.18‌%

(9.21‌)%

Ratios

to

average

net

assets:

(2)

Gross

expenses

before

waivers/

payments

by

Price

Associates

1.09‌%

1.06‌%

1.03‌%

1.02‌%

1.03‌%

Net

expenses

after

waivers/

payments

by

Price

Associates

1.09‌%

1.06‌%

1.03‌%

1.02‌%

1.03‌%

Net

investment

income

1.05‌%

0.81‌%

1.58‌%

1.50‌%

1.46‌%

Portfolio

turnover

rate

35.5‌%

20.0‌%

18.0‌%

9.4‌%

4.0‌%

Net

assets,

end

of

period

(in

thousands)

$16,057

$28,216

$31,021

$168,755

$169,506

0‌%

0‌%

0‌%

0‌%

0‌%

(1)

Per

share

amounts

calculated

using

average

shares

outstanding

method.

(2)

See

Note

5

for

details

of

expense-related

arrangements

with

Price

Associates.

(3)

The

fund

charged

redemption

fees

through

March

31,

2019.

(4)

Amounts

round

to

less

than

$0.01

per

share.

(5)

Total

return

reflects

the

rate

that

an

investor

would

have

earned

on

an

investment

in

the

fund

during

each

period,

assuming

reinvestment

of

all

distributions,

and

payment

of

no

redemption

or

account

fees,

if

applicable.

T.

ROWE

PRICE

Real

Estate

Fund

Financial

Highlights

17

For

a

share

outstanding

throughout

each

period

The

accompanying

notes

are

an

integral

part

of

these

financial

statements.

I

Class

..

Year

..

..

Ended

.

12/31/22

12/31/21

12/31/20

12/31/19

12/31/18

NET

ASSET

VALUE

Beginning

of

period

$

20.20‌

$

15.94‌

$

25.72‌

$

24.80‌

$

28.71‌

Investment

activities

Net

investment

income

(1)(2)

0.28‌

0.24‌

0.34‌

0.56‌

0.57‌

Net

realized

and

unrealized

gain/

loss

(5.37‌)

7.16‌

(3.41‌)

4.94‌

(3.02‌)

Total

from

investment

activities

(5.09‌)

7.40‌

(3.07‌)

5.50‌

(2.45‌)

Distributions

Net

investment

income

(0.27‌)

(0.39‌)

(0.56‌)

(0.80‌)

(0.53‌)

Net

realized

gain

(2.84‌)

(2.75‌)

(6.15‌)

(3.78‌)

(0.93‌)

Total

distributions

(3.11‌)

(3.14‌)

(6.71‌)

(4.58‌)

(1.46‌)

NET

ASSET

VALUE

End

of

period

$

12.00‌

$

20.20‌

$

15.94‌

$

25.72‌

$

24.80‌

Ratios/Supplemental

Data

Total

return

(2)(3)

(25.76‌)%

47.53‌%

(11.28‌)%

22.66‌%

(8.82‌)%

Ratios

to

average

net

assets:

(2)

Gross

expenses

before

waivers/

payments

by

Price

Associates

0.64‌%

0.61‌%

0.62‌%

0.61‌%

0.61‌%

Net

expenses

after

waivers/

payments

by

Price

Associates

0.64‌%

0.61‌%

0.62‌%

0.61‌%

0.61‌%

Net

investment

income

1.68‌%

1.26‌%

1.56‌%

1.95‌%

2.09‌%

Portfolio

turnover

rate

35.5‌%

20.0‌%

18.0‌%

9.4‌%

4.0‌%

Net

assets,

end

of

period

(in

millions)

$352

$261

$197

$787

$923

0‌%

0‌%

0‌%

0‌%

0‌%

(1)

Per

share

amounts

calculated

using

average

shares

outstanding

method.

(2)

See

Note

5

for

details

of

expense-related

arrangements

with

Price

Associates.

(3)

Total

return

reflects

the

rate

that

an

investor

would

have

earned

on

an

investment

in

the

fund

during

each

period,

assuming

reinvestment

of

all

distributions,

and

payment

of

no

redemption

or

account

fees,

if

applicable.

T.

ROWE

PRICE

Real

Estate

Fund

December

31,

2022

18

Portfolio

of

Investments

‡

Shares

$

Value

(Cost

and

value

in

$000s)

‡

COMMON

STOCKS

97.5%

REAL

ESTATE

97.5%

Agriculture/Land

2.4%

Rayonier,

REIT 

502,676‌

16,568‌

Weyerhaeuser,

REIT 

324,200‌

10,050‌

26,618‌

Apartment

Residential

20.0%

American

Homes

4

Rent,

Class

A,

REIT 

880,533‌

26,539‌

Apartment

Income

REIT,

REIT 

113,901‌

3,908‌

Apartment

Investment

&

Management,

Class

A,

REIT 

473,000‌

3,368‌

AvalonBay

Communities,

REIT 

209,965‌

33,914‌

Camden

Property

Trust,

REIT 

236,356‌

26,443‌

Equity

LifeStyle

Properties,

REIT 

955,687‌

61,737‌

Equity

Residential,

REIT 

571,697‌

33,730‌

Essex

Property

Trust,

REIT 

169,421‌

35,904‌

225,543‌

Data

Centers

6.2%

Equinix,

REIT 

105,938‌

69,393‌

69,393‌

Diversified

0.5%

Howard

Hughes  (1)

79,727‌

6,093‌

6,093‌

Healthcare

7.8%

Alexandria

Real

Estate

Equities,

REIT 

238,842‌

34,792‌

Ventas,

REIT 

349,239‌

15,733‌

Welltower,

REIT 

576,014‌

37,758‌

88,283‌

Industrial

15.8%

EastGroup

Properties,

REIT 

215,958‌

31,975‌

Prologis,

REIT 

693,647‌

78,195‌

Rexford

Industrial

Realty,

REIT 

686,700‌

37,521‌

Terreno

Realty,

REIT 

535,905‌

30,477‌

178,168‌

Infrastructure

15.9%

American

Tower,

REIT 

410,420‌

86,951‌

Crown

Castle,

REIT 

288,277‌

39,102‌

SBA

Communications,

REIT 

187,588‌

52,583‌

178,636‌

Lodging/Leisure

6.0%

Apple

Hospitality

REIT,

REIT 

1,383,841‌

21,837‌

Hilton

Worldwide

Holdings 

136,771‌

17,282‌

T.

ROWE

PRICE

Real

Estate

Fund

19

Shares

$

Value

(Cost

and

value

in

$000s)

‡

Host

Hotels

&

Resorts,

REIT 

683,395‌

10,969‌

InterContinental

Hotels

Group

(GBP) 

110,154‌

6,321‌

Pebblebrook

Hotel

Trust,

REIT 

848,324‌

11,359‌

67,768‌

Office

2.9%

Douglas

Emmett,

REIT 

901,680‌

14,138‌

Kilroy

Realty,

REIT 

342,277‌

13,236‌

SL

Green

Realty,

REIT 

160,750‌

5,421‌

32,795‌

Regional

Mall

4.6%

Simon

Property

Group,

REIT 

436,422‌

51,271‌

51,271‌

Self

Storage

9.1%

CubeSmart,

REIT 

673,885‌

27,124‌

Extra

Space

Storage,

REIT 

77,681‌

11,433‌

Public

Storage,

REIT 

226,426‌

63,442‌

101,999‌

Shopping

Center

6.3%

Acadia

Realty

Trust,

REIT 

1,073,908‌

15,411‌

Federal

Realty

Investment

Trust,

REIT 

33,418‌

3,376‌

KRC

Interim,

REIT 

636,796‌

13,487‌

Regency

Centers,

REIT 

627,084‌

39,193‌

71,467‌

Total

Real

Estate

1,098,034‌

Total

Common

Stocks

(Cost

$764,984)

1,098,034‌

SHORT-TERM

INVESTMENTS

1.7%

Money

Market

Funds

1.7%

T.

Rowe

Price

Government

Reserve

Fund,

4.30%  (2)(3)

19,357,360‌

19,357‌

Total

Short-Term

Investments

(Cost

$19,357)

19,357‌

Total

Investments

in

Securities

99.2%

of

Net

Assets

(Cost

$784,341)

$

1,117,391‌

T.

ROWE

PRICE

Real

Estate

Fund

20

‡

Shares

are

denominated

in

U.S.

dollars

unless

otherwise

noted.

(1)

Non-income

producing

(2)

Seven-day

yield

(3)

Affiliated

Companies

GBP

British

Pound

REIT

A

domestic

Real

Estate

Investment

Trust

whose

distributions

pass-through

with

original

tax

character

to

the

shareholder

T.

ROWE

PRICE

Real

Estate

Fund

21

The

accompanying

notes

are

an

integral

part

of

these

financial

statements.

AFFILIATED

COMPANIES

($000s)

The

fund

may

invest

in

certain

securities

that

are

considered

affiliated

companies.

As

defined

by

the

1940

Act,

an

affiliated

company

is

one

in

which

the

fund

owns

5%

or

more

of

the

outstanding

voting

securities,

or

a

company

that

is

under

common

ownership

or

control.

The

following

securities

were

considered

affiliated

companies

for

all

or

some

portion

of

the

year

ended

December

31,

2022.

Net

realized

gain

(loss),

investment

income,

change

in

net

unrealized

gain/loss,

and

purchase

and

sales

cost

reflect

all

activity

for

the

period

then

ended.

Affiliate

Net

Realized

Gain

(Loss)

Change

in

Net

Unrealized

Gain/Loss

Investment

Income

T.

Rowe

Price

Government

Reserve

Fund,

4.30%

$

—‌

#

$

—‌

$

374‌

+

Supplementary

Investment

Schedule

Affiliate

Value

12/31/21

Purchase

Cost

Sales

Cost

Value

12/31/22

T.

Rowe

Price

Government

Reserve

Fund,

4.30%

$

5,397‌

¤

¤

$

19,357‌

^

#

Capital

gain

distributions

from

underlying

Price

funds

represented

$0

of

the

net

realized

gain

(loss).

+

Investment

income

comprised

$374

of

dividend

income

and

$0

of

interest

income.

¤

Purchase

and

sale

information

not

shown

for

cash

management

funds.

^

The

cost

basis

of

investments

in

affiliated

companies

was

$19,357.

T.

ROWE

PRICE

Real

Estate

Fund

December

31,

2022

Statement

of

Assets

and

Liabilities

22

($000s,

except

shares

and

per

share

amounts)

The

accompanying

notes

are

an

integral

part

of

these

financial

statements.

Assets

Investments

in

securities,

at

value

(cost

$784,341)

$

1,117,391‌

Receivable

for

investment

securities

sold

6,897‌

Dividends

receivable

5,305‌

Receivable

for

shares

sold

841‌

Other

assets

67‌

Total

assets

1,130,501‌

Liabilities

Payable

for

shares

redeemed

3,033‌

Investment

management

fees

payable

581‌

Due

to

affiliates

121‌

Payable

to

directors

1‌

Other

liabilities

433‌

Total

liabilities

4,169‌

NET

ASSETS

$

1,126,332‌

Net

Assets

Consist

of:

Total

distributable

earnings

(loss)

$

342,736‌

Paid-in

capital

applicable

to

93,828,504

shares

of

$0.0001

par

value

capital

stock

outstanding;

1,000,000,000

shares

authorized

783,596‌

NET

ASSETS

$

1,126,332‌

NET

ASSET

VALUE

PER

SHARE

Investor

Class

($758,673,641

/

63,242,628

shares

outstanding)

$

12.00‌

Advisor

Class

($16,056,598

/

1,292,798

shares

outstanding)

$

12.42‌

I

Class

($351,602,025

/

29,293,078

shares

outstanding)

$

12.00‌

T.

ROWE

PRICE

Real

Estate

Fund

Statement

of

Operations

23

($000s)

The

accompanying

notes

are

an

integral

part

of

these

financial

statements.

Year

Ended

12/31/22

Investment

Income

(Loss)

Dividend

income

–

$

31,389‌

Expenses

Investment

management

8,519‌

Shareholder

servicing

Investor

Class

$

2,123‌

Advisor

Class

48‌

I

Class

117‌

2,288‌

Rule

12b-1

fees

Advisor

Class

52‌

Prospectus

and

shareholder

reports

Investor

Class

47‌

Advisor

Class

1‌

I

Class

2‌

50‌

Custody

and

accounting

212‌

Registration

106‌

Legal

and

audit

25‌

Directors

4‌

Miscellaneous

15‌

Waived

/

paid

by

Price

Associates

(

18‌

)

Total

expenses

11,253‌

Net

investment

income

20,136‌

Realized

and

Unrealized

Gain

/

Loss

–

Net

realized

gain

(loss)

Securities

257,530‌

Foreign

currency

transactions

(

2‌

)

Net

realized

gain

257,528‌

Change

in

net

unrealized

gain

/

loss

on

securities

(

725,580‌

)

Net

realized

and

unrealized

gain

/

loss

(

468,052‌

)

DECREASE

IN

NET

ASSETS

FROM

OPERATIONS

$

(

447,916‌

)

T.

ROWE

PRICE

Real

Estate

Fund

Statement

of

Changes

in

Net

Assets

24

($000s)

Year

.

.

.

.

.

.

.

.

.

.

.

.

.

.

.

.

Ended

.

.

.

.

.

.

.

.

.

.

.

.

.

.

.

.

12/31/22

12/31/21

Increase

(Decrease)

in

Net

Assets

Operations

Net

investment

income

$

20,136‌

$

17,061‌

Net

realized

gain

257,528‌

158,728‌

Change

in

net

unrealized

gain

/

loss

(

725,580‌

)

421,055‌

Increase

(decrease)

in

net

assets

from

operations

(

447,916‌

)

596,844‌

Distributions

to

shareholders

Net

earnings

Investor

Class

(

165,044‌

)

(

209,753‌

)

Advisor

Class

(

3,298‌

)

(

3,775‌

)

I

Class

(

76,996‌

)

(

36,043‌

)

Decrease

in

net

assets

from

distributions

(

245,338‌

)

(

249,571‌

)

Capital

share

transactions

*

Shares

sold

Investor

Class

262,117‌

287,510‌

Advisor

Class

4,345‌

6,769‌

I

Class

322,944‌

74,688‌

Distributions

reinvested

Investor

Class

160,083‌

201,074‌

Advisor

Class

3,221‌

3,714‌

I

Class

73,190‌

34,946‌

Shares

redeemed

Investor

Class

(

697,621‌

)

(

353,774‌

)

Advisor

Class

(

9,659‌

)

(

19,912‌

)

I

Class

(

120,979‌

)

(

97,366‌

)

Increase

(decrease)

in

net

assets

from

capital

share

transactions

(

2,359‌

)

137,649‌

T.

ROWE

PRICE

Real

Estate

Fund

Statement

of

Changes

in

Net

Assets

25

($000s)

The

accompanying

notes

are

an

integral

part

of

these

financial

statements.

Year

.

.

.

.

.

.

.

.

.

.

.

.

.

.

.

.

Ended

.

.

.

.

.

.

.

.

.

.

.

.

.

.

.

.

12/31/22

12/31/21

Net

Assets

Increase

(decrease)

during

period

(

695,613‌

)

484,922‌

Beginning

of

period

1,821,945‌

1,337,023‌

End

of

period

$

1,126,332‌

$

1,821,945‌

*Share

information

(000s)

Shares

sold

Investor

Class

15,296‌

14,730‌

Advisor

Class

249‌

351‌

I

Class

18,005‌

4,036‌

Distributions

reinvested

Investor

Class

12,702‌

10,378‌

Advisor

Class

248‌

186‌

I

Class

5,783‌

1,803‌

Shares

redeemed

Investor

Class

(

40,719‌

)

(

18,799‌

)

Advisor

Class

(

564‌

)

(

1,079‌

)

I

Class

(

7,431‌

)

(

5,244‌

)

Increase

in

shares

outstanding

3,569‌

6,362‌

T.

ROWE

PRICE

Real

Estate

Fund

NOTES

TO

FINANCIAL

STATEMENTS

26

T.

Rowe

Price

Real

Estate

Fund,

Inc.

(the

fund) is

registered

under

the

Investment

Company

Act

of

1940

(the

1940

Act)

as a

nondiversified,

open-end

management

investment

company. The

fund

seeks

to

provide

long-term

growth

through

a

combination

of

capital

appreciation

and

current

income.

The

fund

has

three classes

of

shares:

the

Real

Estate

Fund

(Investor

Class),

the

Real

Estate

Fund–Advisor

Class

(Advisor

Class)

and

the

Real

Estate

Fund–I

Class

(I

Class).

Advisor

Class

shares

are

sold

only

through

various

brokers

and

other

financial

intermediaries.

I

Class

shares

require

a

$500,000

initial

investment

minimum,

although

the

minimum

generally

is

waived

or

reduced

for

financial

intermediaries,

eligible

retirement

plans,

and

certain

other

accounts.

Prior

to

November

15,

2021,

the

initial

investment

minimum

was

$1

million

and

was

generally

waived

for

financial

intermediaries,

eligible

retirement

plans,

and

other

certain

accounts.

As

a

result

of

the

reduction

in

the

I

Class

minimum,

certain

assets

transferred

from

the

Investor

Class

to

the

I

Class.

This

transfer

of

shares

from

Investor

Class

to

I

Class

is

reflected

in

the

Statement

of

Changes

in

Net

Assets

within

the

Capital

shares

transactions

as

Shares

redeemed

and

Shares

sold,

respectively.

The

Advisor

Class

operates

under

a

Board-approved

Rule

12b-1

plan

pursuant

to

which

the

class

compensates

financial

intermediaries

for

distribution,

shareholder

servicing,

and/

or

certain

administrative

services;

the

Investor

and

I

Classes

do

not

pay

Rule

12b-1

fees. Each

class

has

exclusive

voting

rights

on

matters

related

solely

to

that

class;

separate

voting

rights

on

matters

that

relate

to

all

classes;

and,

in

all

other

respects,

the

same

rights

and

obligations

as

the

other

classes.

NOTE

1

-

SIGNIFICANT

ACCOUNTING

POLICIES 

Basis

of

Preparation

 The fund

is

an

investment

company

and

follows

accounting

and

reporting

guidance

in

the

Financial

Accounting

Standards

Board

(FASB)

Accounting

Standards

Codification

Topic

946

(ASC

946).

The

accompanying

financial

statements

were

prepared

in

accordance

with

accounting

principles

generally

accepted

in

the

United

States

of

America

(GAAP),

including,

but

not

limited

to,

ASC

946.

GAAP

requires

the

use

of

estimates

made

by

management.

Management

believes

that

estimates

and

valuations

are

appropriate;

however,

actual

results

may

differ

from

those

estimates,

and

the

valuations

reflected

in

the

accompanying

financial

statements

may

differ

from

the

value

ultimately

realized

upon

sale

or

maturity.

Investment

Transactions,

Investment

Income,

and

Distributions

Investment

transactions

are

accounted

for

on

the

trade

date

basis.

Income

and

expenses

are

recorded

on

the

accrual

basis.

Realized

gains

and

losses

are

reported

on

the

identified

T.

ROWE

PRICE

Real

Estate

Fund

27

cost

basis.

Income

tax-related

interest

and

penalties,

if

incurred,

are

recorded

as

income

tax

expense.

Dividends

received

from

mutual

fund

investments

are

reflected

as

dividend

income;

capital

gain

distributions

are

reflected

as

realized

gain/loss.

Dividend

income

and

capital

gain

distributions

are

recorded

on

the

ex-dividend

date.

Distributions

from

REITs

are

initially

recorded

as

dividend

income

and,

to

the

extent

such

represent

a

return

of

capital

or

capital

gain

for

tax

purposes,

are

reclassified

when

such

information

becomes

available.

Non-cash

dividends,

if

any,

are

recorded

at

the

fair

market

value

of

the

asset

received.

Proceeds

from

litigation

payments,

if

any,

are

included

in

either

net

realized

gain

(loss)

or

change

in

net

unrealized

gain/loss

from

securities.

Distributions

to

shareholders

are

recorded

on

the

ex-dividend

date.

Income

distributions,

if

any,

are

declared

and

paid

by

each

class quarterly.

A

capital

gain

distribution,

if

any, may

also

be

declared

and

paid

by

the

fund

annually.

Class

Accounting

 Shareholder

servicing,

prospectus,

and

shareholder

report

expenses

incurred

by

each

class

are

charged

directly

to

the

class

to

which

they

relate.

Expenses

common

to all classes,

investment

income,

and

realized

and

unrealized

gains

and

losses

are

allocated

to

the

classes

based

upon

the

relative

daily

net

assets

of

each

class.

The

Advisor

Class

pays

Rule

12b-1

fees,

in

an

amount

not

exceeding

0.25%

of

the

class’s

average

daily

net

assets.

Currency

Translation

 Assets,

including

investments,

and

liabilities

denominated

in

foreign

currencies

are

translated

into

U.S.

dollar

values

each

day

at

the

prevailing

exchange

rate,

using

the

mean

of

the

bid

and

asked

prices

of

such

currencies

against

U.S.

dollars

as

provided

by

an

outside

pricing

service.

Purchases

and

sales

of

securities,

income,

and

expenses

are

translated

into

U.S.

dollars

at

the

prevailing

exchange

rate

on

the

respective

date

of

such

transaction.

The

effect

of

changes

in

foreign

currency

exchange

rates

on

realized

and

unrealized

security

gains

and

losses

is

not

bifurcated

from

the

portion

attributable

to

changes

in

market

prices.

Capital

Transactions

 Each

investor’s

interest

in

the

net

assets

of the

fund

is

represented

by

fund

shares. The

fund’s

net

asset

value

(NAV)

per

share

is

computed

at

the

close

of

the

New

York

Stock

Exchange

(NYSE),

normally

4

p.m.

ET,

each

day

the

NYSE

is

open

for

business.

However,

the

NAV

per

share

may

be

calculated

at

a

time

other

than

the

normal

close

of

the

NYSE

if

trading

on

the

NYSE

is

restricted,

if

the

NYSE

closes

earlier,

or

as

may

be

permitted

by

the

SEC.

Purchases

and

redemptions

of

fund

shares

are

transacted

at

the

next-computed

NAV

per

share,

after

receipt

of

the

transaction

order

by

T.

Rowe

Price

Associates,

Inc.,

or

its

agents.

New

Accounting

Guidance

 In

June

2022,

the

FASB

issued

Accounting

Standards

Update

(ASU),

ASU

2022-03,

Fair

Value

Measurement

(Topic

820)

–

Fair

Value

Measurement

of

Equity

Securities

Subject

to

Contractual

Sale

Restrictions,

which

T.

ROWE

PRICE

Real

Estate

Fund

28

clarifies

that

a

contractual

restriction

on

the

sale

of

an

equity

security

is

not

considered

part

of

the

unit

of

account

of

the

equity

security

and,

therefore,

is

not

considered

in

measuring

fair

value.

The

amendments

under

this

ASU

are

effective

for

fiscal

years

beginning

after

December

15,

2023;

however,

the

fund

opted

to

early

adopt,

as

permitted,

effective

December

1,

2022. Adoption

of

the

guidance

did not

have

a

material

impact

on

the fund's

financial  statements.

Indemnification

 In

the

normal

course

of

business, the

fund

may

provide

indemnification

in

connection

with

its

officers

and

directors,

service

providers,

and/or

private

company

investments. The

fund’s

maximum

exposure

under

these

arrangements

is

unknown;

however,

the

risk

of

material

loss

is

currently

considered

to

be

remote.

NOTE

2

-

VALUATION 

Fair

Value

  The

fund’s

financial

instruments

are

valued

at

the

close

of

the

NYSE

and

are

reported

at

fair

value,

which

GAAP

defines

as

the

price

that

would

be

received

to

sell

an

asset

or

paid

to

transfer

a

liability

in

an

orderly

transaction

between

market

participants

at

the

measurement

date. The fund’s

Board

of

Directors

(the

Board)

has

designated

T.

Rowe

Price

Associates,

Inc.

as

the

fund’s

valuation

designee

(Valuation

Designee).

Subject

to

oversight

by

the

Board,

the

Valuation

Designee

performs

the

following

functions

in

performing

fair

value

determinations:

assesses

and

manages

valuation

risks;

establishes

and

applies

fair

value

methodologies;

tests

fair

value

methodologies;

and

evaluates

pricing

vendors

and

pricing

agents.

The

duties

and

responsibilities

of

the

Valuation

Designee

are

performed

by

its

Valuation

Committee. The

Valuation

Designee provides

periodic

reporting

to

the

Board

on

valuation

matters.

Various

valuation

techniques

and

inputs

are

used

to

determine

the

fair

value

of

financial

instruments.

GAAP

establishes

the

following

fair

value

hierarchy

that

categorizes

the

inputs

used

to

measure

fair

value:

Level

1

–

quoted

prices

(unadjusted)

in

active

markets

for

identical

financial

instruments

that

the

fund

can

access

at

the

reporting

date

Level

2

–

inputs

other

than

Level

1

quoted

prices

that

are

observable,

either

directly

or

indirectly

(including,

but

not

limited

to,

quoted

prices

for

similar

financial

instruments

in

active

markets,

quoted

prices

for

identical

or

similar

financial

instruments

in

inactive

markets,

interest

rates

and

yield

curves,

implied

volatilities,

and

credit

spreads)

Level

3

–

unobservable

inputs

(including

the Valuation

Designee’s assumptions

in

determining

fair

value)

T.

ROWE

PRICE

Real

Estate

Fund

29

Observable

inputs

are

developed

using

market

data,

such

as

publicly

available

information

about

actual

events

or

transactions,

and

reflect

the

assumptions

that

market

participants

would

use

to

price

the

financial

instrument.

Unobservable

inputs

are

those

for

which

market

data

are

not

available

and

are

developed

using

the

best

information

available

about

the

assumptions

that

market

participants

would

use

to

price

the

financial

instrument.

GAAP

requires

valuation

techniques

to

maximize

the

use

of

relevant

observable

inputs

and

minimize

the

use

of

unobservable

inputs.

When

multiple

inputs

are

used

to

derive

fair

value,

the

financial

instrument

is

assigned

to

the

level

within

the

fair

value

hierarchy

based

on

the

lowest-level

input

that

is

significant

to

the

fair

value

of

the

financial

instrument.

Input

levels

are

not

necessarily

an

indication

of

the

risk

or

liquidity

associated

with

financial

instruments

at

that

level

but

rather

the

degree

of

judgment

used

in

determining

those

values.

Valuation

Techniques 

Equity

securities,

including

exchange-traded

funds, listed

or

regularly

traded

on

a

securities

exchange

or

in

the

over-the-counter

(OTC)

market

are

valued

at

the

last

quoted

sale

price

or,

for

certain

markets,

the

official

closing

price

at

the

time

the

valuations

are

made.

OTC

Bulletin

Board

securities

are

valued

at

the

mean

of

the

closing

bid

and

asked

prices.

A

security

that

is

listed

or

traded

on

more

than

one

exchange

is

valued

at

the

quotation

on

the

exchange

determined

to

be

the

primary

market

for

such

security.

Listed

securities

not

traded

on

a

particular

day

are

valued

at

the

mean

of

the

closing

bid

and

asked

prices

for

domestic

securities

and

the

last

quoted

sale

or

closing

price

for

international

securities.

The

last

quoted

prices

of

non-U.S.

equity

securities

may

be

adjusted

to

reflect

the

fair

value

of

such

securities

at

the

close

of

the

NYSE,

if

the Valuation

Designee

determines

that

developments

between

the

close

of

a

foreign

market

and

the

close

of

the

NYSE

will

affect

the

value

of

some

or

all

of the

fund’s

portfolio

securities.

Each

business

day,

the

Valuation

Designee uses

information

from

outside

pricing

services

to

evaluate

the

quoted

prices

of

portfolio

securities

and,

if

appropriate,

decide whether

it

is

necessary

to

adjust

quoted

prices

to

reflect

fair

value

by

reviewing

a

variety

of

factors,

including

developments

in

foreign

markets,

the

performance

of

U.S.

securities

markets,

and

the

performance

of

instruments

trading

in

U.S.

markets

that

represent

foreign

securities

and

baskets

of

foreign

securities. The Valuation

Designee

uses

outside

pricing

services

to

provide

it

with

quoted

prices

and

information

to

evaluate

or

adjust

those

prices.

The Valuation

Designee

cannot

predict

how

often

it

will

use

quoted

prices

and

how

often

it

will

determine

it

necessary

to

adjust

those

prices

to

reflect

fair

value.

Investments

in

mutual

funds

are

valued

at

the

mutual

fund’s

closing

NAV

per

share

on

the

day

of

valuation.

Assets

and

liabilities

other

than

financial

instruments,

including

short-term

receivables

and

payables,

are

carried

at

cost,

or

estimated

realizable

value,

if

less,

which

approximates

fair

value. 

T.

ROWE

PRICE

Real

Estate

Fund

30

Investments

for

which

market

quotations are

not

readily

available

or

deemed

unreliable

are

valued

at

fair

value

as

determined

in

good

faith

by

the

Valuation

Designee.

The

Valuation

Designee

has

adopted

methodologies

for

determining

the

fair

value

of

investments

for

which

market

quotations

are

not

readily

available

or

deemed

unreliable,

including

the

use

of

other

pricing

sources.

Factors

used

in

determining

fair

value

vary

by

type

of

investment

and

may

include

market

or

investment

specific

considerations.

The

Valuation

Designee typically

will

afford

greatest

weight

to

actual

prices

in

arm’s

length

transactions,

to

the

extent

they

represent

orderly

transactions

between

market

participants,

transaction

information

can

be

reliably

obtained,

and

prices

are

deemed

representative

of

fair

value.

However,

the

Valuation

Designee may

also

consider

other

valuation

methods

such

as

market-based

valuation

multiples;

a

discount

or

premium

from

market

value

of

a

similar,

freely

traded

security

of

the

same

issuer;

discounted

cash

flows;

yield

to

maturity;

or

some

combination.

Fair

value

determinations

are

reviewed

on

a

regular

basis.

Because

any

fair

value

determination

involves

a

significant

amount

of

judgment,

there

is

a

degree

of

subjectivity

inherent

in

such

pricing

decisions. Fair

value

prices

determined

by

the

Valuation

Designee could

differ

from

those

of

other

market

participants,

and

it

is

possible

that

the

fair

value

determined

for

a

security

may

be

materially

different

from

the

value

that

could

be

realized

upon

the

sale

of

that

security.

Valuation

Inputs

  The

following

table

summarizes

the

fund’s

financial

instruments,

based

on

the

inputs

used

to

determine

their

fair

values

on

December

31,

2022

(for

further

detail

by

category,

please

refer

to

the

accompanying

Portfolio

of

Investments):

NOTE

3

-

OTHER

INVESTMENT

TRANSACTIONS 

Purchases

and

sales

of

portfolio

securities

other

than

short-term securities

aggregated $514,245,000 and

$748,361,000,

respectively,

for

the

year ended

December

31,

2022.

($000s)

Level

1

Level

2

Level

3

Total

Value

Assets

Common

Stocks

$

1,091,713‌

$

6,321‌

$

—‌

$

1,098,034‌

Short-Term

Investments

19,357‌

—‌

—‌

19,357‌

Total

$

1,111,070‌

$

6,321‌

$

—‌

$

1,117,391‌

T.

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Real

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NOTE

4

-

FEDERAL

INCOME

TAXES

Generally,

no

provision

for

federal

income

taxes

is

required

since

the

fund

intends

to

continue

to

qualify

as

a

regulated

investment

company

under

Subchapter

M

of

the

Internal

Revenue

Code

and

distribute

to

shareholders

all

of

its

taxable

income

and

gains.

Distributions

determined

in

accordance

with

federal

income

tax

regulations

may

differ

in

amount

or

character

from

net

investment

income

and

realized

gains

for

financial

reporting

purposes.

The fund

files

U.S.

federal,

state,

and

local

tax

returns

as

required. The

fund’s

tax

returns

are

subject

to

examination

by

the

relevant

tax

authorities

until

expiration

of

the

applicable

statute

of

limitations,

which

is

generally

three

years

after

the

filing

of

the

tax

return

but

which

can

be

extended

to

six

years

in

certain

circumstances.

Tax

returns

for

open

years

have

incorporated

no

uncertain

tax

positions

that

require

a

provision

for

income

taxes.

Capital

accounts

within

the

financial

reporting

records

are

adjusted

for

permanent

book/

tax

differences

to

reflect

tax

character

but

are

not

adjusted

for

temporary

differences.

The

permanent

book/tax

adjustments,

if

any,

have

no

impact

on

results

of

operations

or

net

assets.

The

permanent

book/tax

adjustments

relate

primarily

to

deemed

distributions

on

shareholder

redemptions.

The

tax

character

of

distributions

paid

for

the

periods

presented

was

as

follows:

At

December

31,

2022,

the

tax-basis

cost

of

investments

(including

derivatives,

if

any)

and

gross

unrealized

appreciation

and

depreciation

were

as

follows:

($000s)

December

31,

2022

December

31,

2021

Ordinary

income

(including

short-term

capital

gains,

if

any)

$

20,066‌

$

26,909‌

Long-term

capital

gain

225,272‌

222,662‌

Total

distributions

$

245,338‌

$

249,571‌

($000s)

Cost

of

investments

$

794,310‌

Unrealized

appreciation

$

394,723‌

Unrealized

depreciation

(71,642‌)

Net

unrealized

appreciation

(depreciation)

$

323,081‌

T.

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Real

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Fund

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At

December

31,

2022,

the

tax-basis

components

of

accumulated

net

earnings

(loss)

were

as

follows:

Temporary

differences

between

book-basis

and

tax-basis

components

of

total

distributable

earnings

(loss)

arise

when

certain

items

of

income,

gain,

or

loss

are

recognized

in

different

periods

for

financial

statement

purposes

versus

for

tax

purposes;

these

differences

will

reverse

in

a

subsequent

reporting

period.

The

temporary

differences

relate

primarily

to

the

deferral

of

losses

from

wash

sales.

Other

temporary

differences

relate

primarily

to

deferral

of

REIT

income.

NOTE

5

-

RELATED

PARTY

TRANSACTIONS

The

fund

is

managed

by

T.

Rowe

Price

Associates,

Inc.

(Price

Associates),

a

wholly

owned

subsidiary

of

T.

Rowe

Price

Group,

Inc.

(Price

Group).

The

investment

management

agreement

between

the

fund

and

Price

Associates

provides

for

an

annual

investment

management

fee,

which

is

computed

daily

and

paid

monthly. The

fee

consists

of

an

individual

fund

fee,

equal

to

0.30%

of

the

fund’s

average

daily

net

assets,

and

a

group

fee.

The

group

fee

rate

is

calculated

based

on

the

combined

net

assets

of

certain

mutual

funds

sponsored

by

Price

Associates

(the

group)

applied

to

a

graduated

fee

schedule,

with

rates

ranging

from

0.48%

for

the

first

$1

billion

of

assets

to

0.260%

for

assets

in

excess

of

$845

billion.

The

fund’s

group

fee

is

determined

by

applying

the

group

fee

rate

to

the

fund’s

average

daily

net

assets. At

December

31,

2022,

the

effective

annual

group

fee

rate

was

0.29%.

The

I

Class

is

subject

to

an

operating

expense

limitation

(I

Class

Limit)

pursuant

to

which

Price

Associates

is

contractually

required

to

pay

all

operating

expenses

of

the

I

Class,

excluding

management

fees;

interest;

expenses

related

to

borrowings,

taxes,

and

brokerage; non-recurring,

extraordinary expenses; and

acquired

fund

fees

and

expenses, to

the

extent

such

operating

expenses,

on

an

annualized

basis,

exceed

the

I

Class

Limit. This

agreement

will

continue

through

the

expense

limitation

date

indicated

in

the

table

below,

and

may

be

renewed,

revised,

or

revoked

only

with

approval

of

the

fund’s

Board.

The

I

Class

is

required

to

repay

Price

Associates

for

expenses

previously

paid

to

the

extent

the

class’s

net

assets

grow

or

expenses

decline

($000s)

Undistributed

long-term

capital

gain

$

16,361‌

Net

unrealized

appreciation

(depreciation)

323,081‌

Other

temporary

differences

3,294‌

Total

distributable

earnings

(loss)

$

342,736‌

T.

ROWE

PRICE

Real

Estate

Fund

33

sufficiently

to

allow

repayment

without

causing

the

class’s

operating

expenses

(after

the

repayment

is

taken

into

account)

to

exceed

the

lesser

of:

(1)

the

I

Class

Limit

in

place

at

the

time

such

amounts

were

paid;

or

(2)

the

current

I

Class

Limit.

However,

no

repayment

will

be

made

more

than

three

years

after

the

date

of

a

payment

or

waiver.

Pursuant

to this

agreement,

expenses

were waived/paid

by

and/or

repaid

to

Price

Associates

during

the year

ended December

31,

2022 as

indicated

in

the

table

below

and

remain

subject

to

repayment

by

the

fund.

Any

repayment

of

expenses

previously

waived/

paid

by

Price

Associates

during

the

period

would

be

included

in

the

net

investment

income

and

expense

ratios

presented

on

the

accompanying

Financial

Highlights.

In

addition,

the

fund

has

entered

into

service

agreements

with

Price

Associates

and

two

wholly

owned

subsidiaries

of

Price

Associates,

each

an

affiliate

of

the

fund

(collectively,

Price).

Price

Associates

provides

certain

accounting

and

administrative

services

to

the

fund.

T.

Rowe

Price

Services,

Inc.

provides

shareholder

and

administrative

services

in

its

capacity

as

the

fund’s

transfer

and

dividend-disbursing

agent.

T.

Rowe

Price

Retirement

Plan

Services,

Inc.

provides

subaccounting

and

recordkeeping

services

for

certain

retirement

accounts

invested

in

the

Investor

Class

and

Advisor Class.

For

the

year ended

December

31,

2022,

expenses

incurred

pursuant

to

these

service

agreements

were

$102,000 for

Price

Associates;

$1,127,000 for

T.

Rowe

Price

Services,

Inc.;

and

$83,000 for

T.

Rowe

Price

Retirement

Plan

Services,

Inc.

All

amounts

due

to

and

due

from

Price,

exclusive

of

investment

management

fees

payable,

are

presented

net

on

the

accompanying

Statement

of

Assets

and

Liabilities.

The fund

may

invest

its

cash

reserves

in

certain

open-end

management

investment

companies

managed

by

Price

Associates

and

considered

affiliates

of

the

fund:

the

T.

Rowe

Price

Government

Reserve

Fund

or

the

T.

Rowe

Price

Treasury

Reserve

Fund,

organized

as

money

market

funds

(together,

the

Price

Reserve

Funds).

The

Price

Reserve

Funds

are

offered

as

short-term

investment

options

to

mutual

funds,

trusts,

and

other

accounts

managed

by

Price

Associates

or

its

affiliates

and

are

not

available

for

direct

purchase

by

members

of

the

public.

Cash

collateral

from

securities

lending,

if

any,

is

invested

in

the

T.

Rowe

Price

Government

Reserve Fund. The

Price

Reserve

Funds

pay

no

investment

management

fees.

I

Class

Expense

limitation/I

Class

Limit

0.05%

Expense

limitation

date

04/30/24

(Waived)/repaid

during

the

period

($000s)

$(18)

T.

ROWE

PRICE

Real

Estate

Fund

34

The

fund may

participate

in

securities

purchase

and

sale

transactions

with

other

funds

or

accounts

advised

by

Price

Associates

(cross

trades),

in

accordance

with

procedures

adopted

by the

fund’s

Board

and

Securities

and

Exchange

Commission

rules,

which

require,

among

other

things,

that

such

purchase

and

sale

cross

trades

be

effected

at

the

independent

current

market

price

of

the

security.

During

the

year ended

December

31,

2022,

the

fund

had

no

purchases

or

sales

cross

trades

with

other

funds

or

accounts

advised

by

Price

Associates.

Price

Associates

has

voluntarily

agreed

to

reimburse

the

fund

from

its

own

resources

on

a

monthly

basis

for

the

cost

of

investment

research

embedded

in

the

cost

of

the

fund’s

securities

trades.

This

agreement

may

be

rescinded

at

any

time.

For

the

year ended

December

31,

2022,

this

reimbursement

amounted

to

$16,000,

which

is

included

in

Net

realized

gain

(loss)

on

Securities

in

the

Statement

of

Operations.

NOTE

6

-

OTHER

MATTERS

Unpredictable

events

such

as

environmental

or

natural

disasters,

war,

terrorism,

pandemics,

outbreaks

of

infectious

diseases,

and

similar

public

health

threats

may

significantly

affect

the

economy

and

the

markets

and

issuers

in

which

the fund

invests.

Certain

events

may

cause

instability

across

global

markets,

including

reduced

liquidity

and

disruptions

in

trading

markets,

while

some

events

may

affect

certain

geographic

regions,

countries,

sectors,

and

industries

more

significantly

than

others,

and

exacerbate

other

pre-existing

political,

social,

and

economic

risks.

Since

2020,

a

novel

strain

of

coronavirus

(COVID-19)

has

resulted

in

disruptions

to

global

business

activity

and

caused

significant

volatility

and

declines

in

global

financial

markets.

In

February

2022,

Russian

forces

entered

Ukraine

and

commenced

an

armed

conflict

leading

to

economic

sanctions

being

imposed

on

Russia

and

certain

of

its

citizens,

creating

impacts

on

Russian-related

stocks

and

debt

and

greater

volatility

in

global

markets.

These

are

recent

examples

of

global

events

which

may

have

a

negative

impact

on

the

values

of

certain

portfolio

holdings

or

the

fund’s

overall

performance.

Management

is

actively

monitoring

the

risks

and

financial

impacts

arising

from

these

events.

T.

ROWE

PRICE

Real

Estate

Fund

35

REPORT

OF

INDEPENDENT

REGISTERED

PUBLIC

ACCOUNTING

FIRM

To

the

Board

of

Directors

and

Shareholders

of

T.

Rowe

Price

Real

Estate

Fund,

Inc.

Opinion

on

the

Financial

Statements

We

have

audited

the

accompanying

statement

of

assets

and

liabilities,

including

the

portfolio

of

investments,

of

T.

Rowe

Price

Real

Estate

Fund,

Inc.

(the

"Fund")

as

of

December

31,

2022,

the

related

statement

of

operations

for

the

year

ended

December

31,

2022,

the

statement

of

changes

in

net

assets

for

each

of

the

two

years

in

the

period

ended

December

31,

2022,

including

the

related

notes,

and

the

financial

highlights

for

each

of

the

five

years

in

the

period

ended

December

31,

2022

(collectively

referred

to

as

the

“financial

statements”).

In

our

opinion,

the

financial

statements

present

fairly,

in

all

material

respects,

the

financial

position

of

the

Fund

as

of

December

31,

2022,

the

results

of

its

operations

for

the

year

then

ended,

the

changes

in

its

net

assets

for

each

of

the

two

years

in

the

period

ended

December

31,

2022

and

the

financial

highlights

for

each

of

the

five

years

in

the

period

ended

December

31,

2022

in

conformity

with

accounting

principles

generally

accepted

in

the

United

States

of

America.

Basis

for

Opinion

These

financial

statements

are

the

responsibility

of

the

Fund’s

management.

Our

responsibility

is

to

express

an

opinion

on

the

Fund’s

financial

statements

based

on

our

audits.

We

are

a

public

accounting

firm

registered

with

the

Public

Company

Accounting

Oversight

Board

(United

States)

(PCAOB)

and

are

required

to

be

independent

with

respect

to

the

Fund

in

accordance

with

the

U.S.

federal

securities

laws

and

the

applicable

rules

and

regulations

of

the

Securities

and

Exchange

Commission

and

the

PCAOB.

We

conducted

our

audits

of

these

financial

statements

in

accordance

with

the

standards

of

the

PCAOB.

Those

standards

require

that

we

plan

and

perform

the

audit

to

obtain

reasonable

assurance

about

whether

the

financial

statements

are

free

of

material

misstatement,

whether

due

to

error

or

fraud.

T.

ROWE

PRICE

Real

Estate

Fund

36

Our

audits

included

performing

procedures

to

assess

the

risks

of

material

misstatement

of

the

financial

statements,

whether

due

to

error

or

fraud,

and

performing

procedures

that

respond

to

those

risks.

Such

procedures

included

examining,

on

a

test

basis,

evidence

regarding

the

amounts

and

disclosures

in

the

financial

statements.

Our

audits

also

included

evaluating

the

accounting

principles

used

and

significant

estimates

made

by

management,

as

well

as

evaluating

the

overall

presentation

of

the

financial

statements.

Our

procedures

included

confirmation

of

securities

owned

as

of

December

31,

2022

by

correspondence

with

the

custodians,

transfer

agent

and

brokers;

when

replies

were

not

received

from

brokers,

we

performed

other

auditing

procedures.

We

believe

that

our

audits

provide

a

reasonable

basis

for

our

opinion.  

PricewaterhouseCoopers

LLP

Baltimore,

Maryland

February

21,

2023

We

have

served

as

the

auditor

of

one

or

more

investment

companies

in

the

T.

Rowe

Price

group

of

investment

companies

since

1973.

REPORT

OF

INDEPENDENT

REGISTERED

PUBLIC

ACCOUNTING

FIRM

(continued)

T.

ROWE

PRICE

Real

Estate

Fund

37

TAX

INFORMATION

(UNAUDITED)

FOR

THE

TAX

YEAR

ENDED 12/31/22

We

are

providing

this

information

as

required

by

the

Internal

Revenue

Code.

The

amounts

shown

may

differ

from

those

elsewhere

in

this

report

because

of

differences

between

tax

and

financial

reporting

requirements.

The

fund’s

distributions

to

shareholders

included:

$265,295,000 from

long-term

capital

gains,

subject

to

a

long-term

capital

gains

tax

rate

of

not

greater

than

20%

For

corporate

shareholders,

$73,000

of

the

fund's

income

qualifies

for

the

dividends-

received

deduction.  

For

taxable

non-corporate

shareholders,

$321,000 of

the

fund's

income

represents

qualified

dividend

income

subject

to

a

long-term

capital

gains

tax

rate

of

not

greater

than

20%.

For

individuals

and

certain

trusts

and

estates

which

are

entitled

to

claim

a

deduction

of

up

to

20%

of

their

combined

qualified

real

estate

investment

trust

(REIT)

dividends,

$20,427,000 of

the

fund's

income

qualifies

as

qualified

real

estate

investment

trust

(REIT)

dividends.

T.

ROWE

PRICE

Real

Estate

Fund

38

INFORMATION

ON

PROXY

VOTING

POLICIES,

PROCEDURES,

AND

RECORDS

A

description

of

the

policies

and

procedures

used

by

T.

Rowe

Price

funds

to

determine

how

to

vote

proxies

relating

to

portfolio

securities

is

available

in

each

fund’s

Statement

of

Additional

Information.

You

may

request

this

document

by

calling

1-800-225-5132

or

by

accessing

the

SEC’s

website,

sec.gov.

The

description

of

our

proxy

voting

policies

and

procedures

is

also

available

on

our

corporate

website.

To

access

it,

please

visit

the

following

Web

page:

https://www.troweprice.com/corporate/us/en/utility/policies.html

Scroll

down

to

the

section

near

the

bottom

of

the

page

that

says,

“Proxy

Voting

Guidelines.”

Click

on

the

links

in

the

shaded

box.

Each

fund’s

most

recent

annual

proxy

voting

record

is

available

on

our

website

and

through

the

SEC’s

website.

To

access

it

through

T.

Rowe

Price,

visit

the

website

location

shown

above,

and

scroll

down

to

the

section

near

the

bottom

of

the

page

that

says,

“Proxy

Voting

Records.”

Click

on

the

Proxy

Voting

Records

link

in

the

shaded

box.

HOW

TO

OBTAIN

QUARTERLY

PORTFOLIO

HOLDINGS

The

fund

files

a

complete

schedule

of

portfolio

holdings

with

the

Securities

and

Exchange

Commission

(SEC)

for

the

first

and

third

quarters

of

each

fiscal

year

as

an

exhibit

to

its

reports

on

Form

N-PORT.

The

fund’s

reports

on

Form

N-PORT

are

available

electronically

on

the

SEC’s

website

(sec.gov).

In

addition,

most

T.

Rowe

Price

funds

disclose

their

first

and

third

fiscal

quarter-end

holdings

on

troweprice.com

.

T.

ROWE

PRICE

Real

Estate

Fund

39

Liquidity

Risk

Management

Program

In

accordance

with

Rule

22e-4

(Liquidity

Rule)

under

the

Investment

Company

Act

of

1940,

as

amended,

the

fund

has

established

a

liquidity

risk

management

program

(Liquidity

Program)

reasonably

designed

to

assess

and

manage

the

fund’s

liquidity

risk,

which

generally

represents

the

risk

that

the

fund

would

not

be

able

to

meet

redemption

requests

without

significant

dilution

of

remaining

investors’

interests

in

the

fund.

The

fund’s

Board

of

Directors

(Board)

has

appointed

the

fund’s

investment

adviser,

T.

Rowe

Price

Associates,

Inc.

(Adviser),

as

the

administrator

of

the

Liquidity

Program.

As

administrator,

the

Adviser

is

responsible

for

overseeing

the

day-to-day

operations

of

the

Liquidity

Program

and,

among

other

things,

is

responsible

for

assessing,

managing,

and

reviewing

with

the

Board

at

least

annually

the

liquidity

risk

of

each

T.

Rowe

Price

fund.

The

Adviser

has

delegated

oversight

of

the

Liquidity

Program

to

a

Liquidity

Risk

Committee

(LRC),

which

is

a

cross-functional

committee

composed

of

personnel

from

multiple

departments

within

the

Adviser.

The

Liquidity Program’s principal

objectives

include

supporting

the T.

Rowe

Price

funds’ compliance

with

limits

on

investments

in

illiquid

assets

and

mitigating

the

risk

that

the

fund

will

be

unable to timely

meet

its

redemption

obligations. The

Liquidity

Program

also

includes

a

number

of

elements

that

support

the

management

and

assessment

of

liquidity

risk,

including

an

annual

assessment

of

factors

that

influence

the fund’s liquidity

and

the

periodic

classification

and

reclassification

of

a

fund’s

investments

into

categories

that

reflect

the

LRC’s

assessment

of

their

relative

liquidity

under

current

market

conditions.

Under

the

Liquidity

Program,

every

investment

held

by

the

fund

is

classified

at

least

monthly

into

one

of

four

liquidity

categories

based

on

estimations

of

the

investment’s

ability

to

be

sold

during

designated

time

frames

in

current

market

conditions

without

significantly

changing

the

investment’s

market

value.

As

required

by

the

Liquidity

Rule,

at

a

meeting

held

on

July

25,

2022,

the

Board

was

presented

with

an

annual

assessment

prepared

by

the

LRC,

on

behalf

of

the

Adviser,

that

addressed

the

operation

of

the

Liquidity

Program

and

assessed

its

adequacy

and

effectiveness

of

implementation,

including

any

material

changes

to

the

Liquidity

Program

and

the

determination

of

each

fund’s

Highly

Liquid

Investment

Minimum

(HLIM).

The

annual

assessment

included

consideration

of

the

following

factors,

as

applicable:

the

fund’s

investment

strategy

and

liquidity

of

portfolio

investments

during

normal

and

reasonably

foreseeable

stressed

conditions,

including

whether

the

investment

strategy

is

appropriate

for

an

open-end

fund,

the

extent

to

which

the

strategy

involves

a

relatively

concentrated

portfolio

or

large

positions

in

particular

issuers,

and

the

use

of

borrowings

for

investment

purposes

and

derivatives;

short-term

and

long-term

cash

flow

projections

covering

both

normal

and

reasonably

foreseeable

stressed

conditions;

and

holdings

of

cash

and

cash

equivalents,

as

well

as

available

borrowing

arrangements.

T.

ROWE

PRICE

Real

Estate

Fund

40

For

the

fund

and

other

T.

Rowe

Price

funds,

the

annual

assessment

incorporated

a

report

related

to

a

fund’s

holdings,

shareholder

and

portfolio

concentration,

any

borrowings

during

the

period,

cash

flow

projections,

and

other

relevant

data

for

the

period

of

April

1,

2021,

through

March

31,

2022.

The

report

described

the

methodology

for

classifying

a

fund’s

investments

(including

any

derivative

transactions)

into

one

of

four

liquidity

categories,

as

well

as

the

percentage

of

a

fund’s

investments

assigned

to

each

category.

It

also

explained

the

methodology

for

establishing

a

fund’s

HLIM

and

noted

that

the

LRC

reviews

the

HLIM

assigned

to

each

fund

no

less

frequently

than

annually.

During

the

period

covered

by

the

annual

assessment,

the

LRC

has

concluded,

and

reported

to

the

Board,

that

the

Liquidity

Program

continues

to

operate

adequately

and

effectively

and

is

reasonably

designed

to

assess

and

manage

the

fund’s

liquidity

risk.

T.

ROWE

PRICE

Real

Estate

Fund

41

ABOUT

THE

FUND'S

DIRECTORS

AND

OFFICERS

Your

fund

is

overseen

by

a

Board

of

Directors

(Board)

that

meets

regularly

to

review

a

wide

variety

of

matters

affecting

or

potentially

affecting

the

fund,

including

performance,

investment

programs,

compliance

matters,

advisory

fees

and

expenses,

service

providers,

and

business

and

regulatory

affairs.

The

Board

elects

the

fund’s

officers,

who

are

listed

in

the

final

table.

The

directors

who

are

also

employees

or

officers

of

T.

Rowe

Price

are

considered

to

be

“interested”

directors

as

defined

in

Section

2(a)(19)

of

the

1940

Act

because

of

their

relationships

with

T.

Rowe

Price

and

its

affiliates.

The

business

address

of

each

director

and

officer

is

100

East

Pratt

Street,

Baltimore,

Maryland

21202.

The

Statement

of

Additional

Information

includes

additional

information

about

the

fund

directors

and

is

available

without

charge

by

calling

a

T.

Rowe

Price

representative

at

1-800-638-5660.

INDEPENDENT

DIRECTORS

(a)

Name

(Year

of

Birth)

Year

Elected

[Number

of

T.

Rowe

Price

Portfolios

Overseen]

Principal

Occupation(s)

and

Directorships

of

Public

Companies

and

Other

Investment

Companies

During

the

Past

Five

Years

Teresa

Bryce

Bazemore

(1959)

2018

[205]

President

and

Chief

Executive

Officer,

Federal

Home

Loan

Bank

of

San

Francisco

(2021

to

present);

President,

Radian

Guaranty

(2008

to

2017);

Chief

Executive

Officer,

Bazemore

Consulting

LLC

(2018

to

2021);

Director,

Chimera

Investment

Corporation

(2017

to

2021);

Director,

First

Industrial

Realty

Trust

(2020

to

present);

Director,

Federal

Home

Loan

Bank

of

Pittsburgh

(2017

to

2019)

Ronald

J.

Daniels

(b)

(1959)

2018

[0]

President,

The

Johns

Hopkins

University

and

Professor,

Political

Science

Department,

The

Johns

Hopkins

University

(2009

to

present);

Director,

Lyndhurst

Holdings

(2015

to

present);

Director,

BridgeBio

Pharma,

Inc.

(2020

to

present)

Bruce

W.

Duncan

(1951)

2013

[205]

President,

Chief

Executive

Officer,

and

Director,

CyrusOne,

Inc.

(2020

to

2021);

Chief

Executive

Officer

and

Director

(2009

to

2016),

Chair

of

the

Board

(2016

to

2020),

and

President

(2009

to

2016),

First

Industrial

Realty

Trust,

owner

and

operator

of

industrial

properties;

Chair

of

the

Board

(2005

to

2016)

and

Director

(1999

to

2016),

Starwood

Hotels

&

Resorts,

a

hotel

and

leisure

company;

Member,

Investment

Company

Institute

Board

of

Governors

(2017

to

2019);

Member,

Independent

Directors

Council

Governing

Board

(2017

to

2019);

Senior

Advisor,

KKR

(2018

to

present);

Director,

Boston

Properties

(2016

to

present);

Director,

Marriott

International,

Inc.

(2016

to

2020)

Robert

J.

Gerrard,

Jr.

(1952)

2012

[205]

Advisory

Board

Member,

Pipeline

Crisis/Winning

Strategies,

a

collaborative

working

to

improve

opportunities

for

young

African

Americans

(1997

to

2016);

Chair

of

the

Board,

all

funds

(July

2018

to

present)

T.

ROWE

PRICE

Real

Estate

Fund

42

INTERESTED  DIRECTORS

(a)

Name

(Year

of

Birth)

Year

Elected

[Number

of

T.

Rowe

Price

Portfolios

Overseen]

Principal

Occupation(s)

and

Directorships

of

Public

Companies

and

Other

Investment

Companies

During

the

Past

Five

Years

Paul

F.

McBride

(1956)

2013

[205]

Advisory

Board

Member,

Vizzia

Technologies

(2015

to

present);

Board

Member,

Dunbar

Armored

(2012

to

2018)

Kellye

L.

Walker

(c)

(1966)

2021

[205]

Executive

Vice

President

and

Chief

Legal

Officer,

Eastman

Chemical

Company

(April

2020

to

present);

Executive

Vice

President

and

Chief

Legal

Officer,

Huntington

Ingalls

Industries,

Inc.

(January

2015

to

March

2020);

Director,

Lincoln

Electric

Company

(October

2020

to

present)

(a)

All

information

about

the

independent

directors

was

current

as

of

December

31,

2021,

unless

otherwise

indicated,

except

for

the

number

of

portfolios

overseen,

which

is

current

as

of

the

date

of

this

report.

(b)

Effective

April

27,

2022,

Mr.

Daniels

resigned

from

his

role

as

an

independent

director

of

the

Price

Funds.

(c)

Effective

November

8,

2021,

Ms.

Walker

was

appointed

as

an

independent

director

of

the

Price

Funds.

Name

(Year

of

Birth)

Year

Elected

[Number

of

T.

Rowe

Price

Portfolios

Overseen]

Principal

Occupation(s)

and

Directorships

of

Public

Companies

and

Other

Investment

Companies

During

the

Past

Five

Years

David

Oestreicher

(1967)

2018

[205]

Director,

Vice

President,

and

Secretary,

T.

Rowe

Price,

T.

Rowe

Price

Investment

Services,

Inc.,

T.

Rowe

Price

Retirement

Plan

Services,

Inc.,

and

T.

Rowe

Price

Services,

Inc.;

Director

and

Secretary,

T.

Rowe

Price

Investment

Management,

Inc.

(Price

Investment

Management);

Vice

President

and

Secretary,

T.

Rowe

Price

International

(Price

International);

Vice

President,

T.

Rowe

Price

Hong

Kong

(Price

Hong

Kong),

T. Rowe

Price

Japan

(Price

Japan),

and

T.

Rowe

Price

Singapore

(Price

Singapore);

General

Counsel,

Vice

President,

and

Secretary,

T.

Rowe

Price

Group,

Inc.;

Chair

of

the

Board,

Chief

Executive

Officer,

President,

and

Secretary,

T.

Rowe

Price

Trust

Company;

Principal

Executive

Officer

and

Executive

Vice

President,

all

funds

Robert

W.

Sharps,

CFA,

CPA

(b)

(1971)

2017

[0]

Director

and

Vice

President,

T.

Rowe

Price;

Director,

Price

Investment

Management;

Chief

Executive

Officer

and

President,

T.

Rowe

Price

Group,

Inc.;

Vice

President,

T.

Rowe

Price

Trust

Company

INDEPENDENT

DIRECTORS

(a)

(CONTINUED)

T.

ROWE

PRICE

Real

Estate

Fund

43

OFFICERS

Name

(Year

of

Birth)

Year

Elected

[Number

of

T.

Rowe

Price

Portfolios

Overseen]

Principal

Occupation(s)

and

Directorships

of

Public

Companies

and

Other

Investment

Companies

During

the

Past

Five

Years

Eric

L.

Veiel,

CFA

(1972)

2022

[205]

Director

and

Vice

President,

T.

Rowe

Price;

Vice

President,

T.

Rowe

Price

Group,

Inc.,

and

T.

Rowe

Price

Trust

Company

(a)

All

information

about

the

interested

directors

was

current

as

of

January

1,

2022,

unless

otherwise

indicated,

except

for

the

number

of

portfolios

overseen,

which

is

current

as

of

the

date

of

this

report.

(b)

Effective

February

3,

2022,

Mr.

Sharps

resigned

from

his

role

as

an

interested

director

of

the

Price

Funds.

Name

(Year

of

Birth)

Position

Held

With

Real

Estate

Fund

Principal

Occupation(s) 

Armando

(Dino)

Capasso

(1974)

Chief

Compliance

Officer

Chief

Compliance

Officer

and

Vice

President,

T.

Rowe

Price

and

Price

Investment

Management;

Vice

President,

T.

Rowe

Price

Group,

Inc.;

formerly,

Chief

Compliance

Officer,

PGIM

Investments

LLC

and

AST

Investment

Services,

Inc.

(ASTIS)

(to

2022);

Chief

Compliance

Officer,

PGIM

Retail

Funds

complex

and

Prudential

Insurance

Funds

(to

2022);

Vice

President

and

Deputy

Chief

Compliance

Officer,

PGIM

Investments

LLC

and

ASTIS

(to

2019);

Senior

Vice

President

and

Senior

Counsel,

Pacific

Investment

Management

Company

LLC

(to

2017) 

Alan

S.

Dupski,

CPA

(1982)

Principal

Financial

Officer,

Vice

President,

and

Treasurer

Vice

President,

Price

Investment

Management,

T.

Rowe

Price,

T.

Rowe

Price

Group,

Inc.,

and

T.

Rowe

Price

Trust

Company

Gary

J.

Greb

(1961)

Vice

President

Vice

President,

Price

Investment

Management,

T.

Rowe

Price,

Price

International,

and

T.

Rowe

Price

Trust

Company

Cheryl

Hampton,

CPA

(1969)

Vice

President

Vice

President,

T.

Rowe

Price;

formerly,

Tax

Director,

Invesco

Ltd.

(to

2021);

Vice

President,

Oppenheimer

Funds,

Inc.

(to

2019)

Thomas

J.

Huber,

CFA

(1966)

Vice

President

Vice

President,

T.

Rowe

Price,

T.

Rowe

Price

Group,

Inc.,

and

T.

Rowe

Price

Trust

Company

Unless

otherwise

noted,

officers

have

been

employees

of

T.

Rowe

Price

or

Price

International

for

at

least

5

years.

INTERESTED  DIRECTORS

(a)

(CONTINUED)

T.

ROWE

PRICE

Real

Estate

Fund

44

Name

(Year

of

Birth)

Position

Held

With

Real

Estate

Fund

Principal

Occupation(s) 

Nina

P.

Jones,

CPA

(1980)

President

Vice

President,

T.

Rowe

Price

and

T.

Rowe

Price

Group,

Inc.

Benjamin

Kersse,

CPA

(1989)

Vice

President

Vice

President,

T.

Rowe

Price

Gregg

Korondi

(1976)

Vice

President

Vice

President,

T.

Rowe

Price

and

T.

Rowe

Price

Group,

Inc.;

formerly,

Managing

Director,

LaSalle

Investment

Management

Securities

(to

2019)

Paul

J.

Krug,

CPA

(1964)

Vice

President

Vice

President,

T.

Rowe

Price,

T.

Rowe

Price

Group,

Inc.,

and

T.

Rowe

Price

Trust

Company

Philip

A.

Nestico

(1976)

Vice

President

Vice

President,

T.

Rowe

Price

and

T.

Rowe

Price

Group,

Inc.

Dante

Pearson

(1990)

Vice

President

Vice

President,

T.

Rowe

Price

and

T.

Rowe

Price

Group,

Inc.

Fran

M.

Pollack-Matz

(1961)

Vice

President

and

Secretary 

Vice

President,

T.

Rowe

Price,

T.

Rowe

Price

Group,

Inc.,

T.

Rowe

Price

Investment

Services,

Inc.,

and

T.

Rowe

Price

Services,

Inc.

Shannon

H.

Rauser

(1987)

Assistant

Secretary 

Assistant

Vice

President,

T.

Rowe

Price

Jane

K.

Rivers,

CFA

(1979)

Vice

President

Vice

President,

T.

Rowe

Price

and

T.

Rowe

Price

Group,

Inc.

Theodore

E.

Robson,

CFA

(1965)

Vice

President

Vice

President,

T.

Rowe

Price,

T.

Rowe

Price

Group,

Inc.,

and

T.

Rowe

Price

Trust

Company

Weijie

(Vivian)

Si

(1983)

Vice

President

Vice

President,

T.

Rowe

Price

and

T.

Rowe

Price

Group,

Inc.

Preeta

Ragavan

Srinivasan,

CFA

(1987)

Vice

President

Vice

President,

T.

Rowe

Price

and

T.

Rowe

Price

Group,

Inc.

Megan

Warren

(1968)

Vice

President

OFAC

Sanctions

Compliance

Officer

and

Vice

President,

Price

Investment

Management;

Vice

President,

T.

Rowe

Price,

T.

Rowe

Price

Group,

Inc.,

T.

Rowe

Price

Retirement

Plan

Services,

Inc.,

T.

Rowe

Price

Services,

Inc.,

and

T.

Rowe

Price

Trust

Company

Charlene

Wong  (1992)

Vice

President

Employee,

T.

Rowe

Price 

Unless

otherwise

noted,

officers

have

been

employees

of

T.

Rowe

Price

or

Price

International

for

at

least

5

years.

OFFICERS

(CONTINUED)

T.

Rowe

Price

Investment

Services,

Inc.

|

100

East

Pratt

Street

|

Baltimore,

MD

21202-1009

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All

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the

Investment

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Brokerage

services

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by

T.

Rowe

Price

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Brokerage

accounts

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a

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member

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T.

Rowe

Price

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202302-2582816

F122-050

2/23

Item 1. (b) Notice pursuant to Rule 30e-3.

Not applicable.

Item 2. Code of Ethics.

The registrant has adopted a code of ethics, as defined in Item 2 of Form N-CSR, applicable to its principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions. A copy of this code of ethics is filed as an exhibit to this Form N-CSR. No substantive amendments were approved or waivers were granted to this code of ethics during the period covered by this report.

Item 3. Audit Committee Financial Expert.

The registrant’s Board of Directors has determined that Ms. Teresa Bryce Bazemore qualifies as an audit committee financial expert, as defined in Item 3 of Form N-CSR. Ms. Bazemore is considered independent for purposes of Item 3 of Form N-CSR.

Item 4. Principal Accountant Fees and Services.

(a) – (d)    Aggregate fees billed for the last two fiscal years for professional services rendered to, or on behalf of, the registrant by the registrant’s principal accountant were as follows:

	2022		2021
Audit Fees	$	21,734	$	41,145
Audit-Related Fees		-		-
Tax Fees		-		1,540
All Other Fees		-		-

Audit fees include amounts related to the audit of the registrant’s annual financial statements and services normally provided by the accountant in connection with statutory and regulatory filings. Audit-related fees include amounts reasonably related to the performance of the audit of the registrant’s financial statements and specifically include the issuance of a report on internal controls and, if applicable, agreed-upon procedures related to fund acquisitions. Tax fees include amounts related to services for tax compliance, tax planning, and tax advice. The nature of these services specifically includes the review of distribution calculations and the preparation of Federal, state, and excise tax returns. All other fees include the registrant’s pro-rata share of amounts for agreed-upon procedures in conjunction with service contract approvals by the registrant’s Board of Directors/Trustees.

(e)(1)  The registrant’s audit committee has adopted a policy whereby audit and non-audit services performed by the registrant’s principal accountant for the registrant, its investment adviser, and any entity controlling, controlled by, or under common control with the investment adviser that provides ongoing services to the registrant require pre-approval in advance at regularly scheduled audit committee meetings. If such a service is required between regularly scheduled audit committee meetings, pre-approval may be authorized by one audit committee member with ratification at the next scheduled audit committee meeting. Waiver of pre-approval for audit or non-audit services requiring fees of a de minimis amount is not permitted.

(2)   No services included in (b) – (d) above were approved pursuant to paragraph (c)(7)(i)(C) of Rule 2-01 of Regulation S-X.

(f)    Less than 50 percent of the hours expended on the principal accountant’s engagement to audit the registrant’s financial statements for the most recent fiscal year were attributed to work performed by persons other than the principal accountant’s full-time, permanent employees.

(g)    The aggregate fees billed for the most recent fiscal year and the preceding fiscal year by the registrant’s principal accountant for non-audit services rendered to the registrant, its investment adviser, and any entity controlling, controlled by, or under common control with the investment adviser that provides ongoing services to the registrant were $2,037,000 and $3,732,000, respectively.

(h)    All non-audit services rendered in (g) above were pre-approved by the registrant’s audit committee. Accordingly, these services were considered by the registrant’s audit committee in maintaining the principal accountant’s independence.

Item 5. Audit Committee of Listed Registrants.

Not applicable.

Item 6. Investments.

(a) Not applicable. The complete schedule of investments is included in Item 1 of this Form N-CSR.

(b) Not applicable.

Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies.

Not applicable.

Item 8. Portfolio Managers of Closed-End Management Investment Companies.

Not applicable.

Item 9. Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers.

Not applicable.

Item 10. Submission of Matters to a Vote of Security Holders.

There has been no change to the procedures by which shareholders may recommend nominees to the registrant’s board of directors.

Item 11. Controls and Procedures.

(a) The registrant’s principal executive officer and principal financial officer have evaluated the registrant’s disclosure controls and procedures within 90 days of this filing and have concluded that the registrant’s disclosure controls and procedures were effective, as of that date, in ensuring that information required to be disclosed by the registrant in this Form N-CSR was recorded, processed, summarized, and reported timely.

(b)    The registrant’s principal executive officer and principal financial officer are aware of no change in the registrant’s internal control over financial reporting that occurred during the period covered by this report that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting.

Item 12. Disclosure of Securities Lending Activities for Closed-End Management Investment Companies.

Not applicable.

Item 13. Exhibits.

(a)(1) The registrant’s code of ethics pursuant to Item 2 of Form N-CSR is attached.

(2) Separate certifications by the registrant’s principal executive officer and principal financial officer, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 and required by Rule 30a-2(a) under the Investment Company Act of 1940, are attached.

(3) Written solicitation to repurchase securities issued by closed-end companies: not applicable.

(b) A certification by the registrant’s principal executive officer and principal financial officer, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 and required by Rule 30a-2(b) under the Investment Company Act of 1940, is attached.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

T. Rowe Price Real Estate Fund, Inc.
By	/s/ David Oestreicher
	David Oestreicher
	Principal Executive Officer
Date	February 21, 2023

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

By	/s/ David Oestreicher
	David Oestreicher
	Principal Executive Officer
Date	February 21, 2023
By	/s/ Alan S. Dupski
	Alan S. Dupski
	Principal Financial Officer
Date	February 21, 2023