Item 1. | Reports to Stockholders. |
![LOGO](https://capedge.com/proxy/N-CSR/0001193125-23-043544/g359486g67w40.jpg)
![LOGO](https://capedge.com/proxy/N-CSR/0001193125-23-043544/g359486g06w80.jpg)
2 | ||||
3 | ||||
7 | ||||
8 | ||||
15 | ||||
18 | ||||
19 | ||||
20 | ||||
21 | ||||
22 | ||||
24 | ||||
31 | ||||
33 | ||||
38 |
Annual Report 2022 CBRE Global Real Estate Income Fund | Confidential & Proprietary | 1 |
Annual Report 2022 CBRE Global Real Estate Income Fund | Confidential & Proprietary | 2 |
![LOGO](https://capedge.com/proxy/N-CSR/0001193125-23-043544/g359486g70d01.jpg)
![LOGO](https://capedge.com/proxy/N-CSR/0001193125-23-043544/g359486wein_photo.jpg)
![LOGO](https://capedge.com/proxy/N-CSR/0001193125-23-043544/g359486miniman_rebrand.jpg)
1H2022 | 2H2022 | CY2022 | ||||
REGION | ||||||
North America 2 | -20.9% | -6.0% | -25.6% | |||
Europe 2 | -33.6% | -10.7% | -40.7% | |||
Asia-Pacific 2 | -10.3% | -1.2% | -11.4% | |||
Global Real Estate Common Stocks 3 | -20.7% | -5.5% | -25.1% | |||
U.S. REIT Preferred Stocks 4 | -13.5% | -8.5% | -20.8% | |||
80/20 Blend of Global Common Stock & U.S. Preferred Stock 5 | -19.3% | -6.0% | -24.1% |
1 | Global real estate stocks as measured by FTSE EPRA Nareit Developed Index – Net returned -5.5% during the second half of the year and-25.1% for the calendar year. The broader market is measured by the MSCI World Index (USD) which returned-17.7% for the calendar year. |
2 | Regional allocations for the FTSE EPRA Nareit Developed Index – Net are determined based on classifications by CBRE Investment Management. North America regional performance excludes U.S. REIT preferred stocks and only represents U.S. common stocks within the FTSE EPRA Nareit Developed Index – Net. |
3 | Represented by the FTSE EPRA Nareit Developed Index – Net. The Index is an unmanaged market-weighted index consisting of real estate companies from developed markets, where greater than 75% of constituents’ EBITDA (earnings before interest, taxes, depreciation, and amortization) is derived from relevant real estate activities and is calculated net of withholding taxes. Investors cannot invest directly in an index. |
4 | Represented by the MSCI REIT Preferred Index, a preferred stock market capitalization weighted index of certain exchange traded preferred securities issued by U.S. equity and U.S. hybrid REITs. Investors cannot invest directly in an index. |
5 | Represented by the daily weighted average of the following indices: 80% FTSE EPRA Nareit Developed – Net and 20% MSCI Preferred Index. Investors cannot invest directly in an index. |
Annual Report 2022 CBRE Global Real Estate Income Fund | Confidential & Proprietary | 3 |
Geographic Exposure | Sector Exposure | |
![]() | ![]() | |
Source: CBRE Investment Management as of 12/31/2022. |
6 | The Trust is currently paying distributions comprised of net investment income and net realized capital gains. If net investment income and net realized gains are not sufficient to fully cover the distribution, then a portion of the distribution would be return of capital. The Board regularly reviews the coverage and composition of the distribution to ensure the distribution level is appropriate. The estimated composition of each distribution, including any return of capital, will be provided to shareholders of record and is also available at www.cbreim.com. Final determination of a distribution’s tax character will be made on Form 1099 DIV and sent to shareholders |
Annual Report 2022 CBRE Global Real Estate Income Fund | Confidential & Proprietary | 4 |
![LOGO](https://capedge.com/proxy/N-CSR/0001193125-23-043544/g359486g71r45.jpg)
Japan | U.K. | U.S. | Canada | Australia | Singapore | Hong Kong SAR, China | Cont.Europe | Global Average | ||||||||||||||||||||||||||||
∎ 2022 | 8.4% | 12.4% | 10.6% | 4.8% | 15.8% | 28.1% | -2.5% | 10.6% | 10.4% | |||||||||||||||||||||||||||
∎ 2023f | 7.0% | 5.3% | 4.7% | 4.3% | 3.5% | 3.3% | -1.1% | -1.5% | 4.1% |
![LOGO](https://capedge.com/proxy/N-CSR/0001193125-23-043544/g359486g86c78.jpg)
Annual Report 2022 CBRE Global Real Estate Income Fund | Confidential & Proprietary | 5 |
![]() | ![]() | ![]() | ||
JOSEPH P. SMITH, CFA Portfolio Manager President & CEO | KENNETH S. WEINBERG, CFA Portfolio Manager | JONATHAN D. MINIMAN, CFA Portfolio Manager |
Annual Report 2022 CBRE Global Real Estate Income Fund | Confidential & Proprietary | 6 |
Beginning account value | Ending account value | Annualized expense ratio | Expenses paid during the period | |||||||||||||
July 1, 2022 | December 31, 2022 | Per $1,000 (1) | ||||||||||||||
CBRE GLOBAL REAL ESTATE INCOME FUND | ||||||||||||||||
Actual | $ | 1,000.00 | $ | 905.50 | 2.99 | % | $ | 14.36 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,010.13 | 2.99 | % | $ | 15.15 |
(1) | Expenses are equal to the Fund’s annualized expense ratio, multiplied by the average account value over the period, multiplied by 184 (the number of days in the most recent six-month period), then divided by 365. |
Annual Report 2022 CBRE Global Real Estate Income Fund | Confidential & Proprietary | 7 |
Annual Report 2022 CBRE Global Real Estate Income Fund | Confidential & Proprietary | 8 |
– | Retail Properties Retail properties are affected by the overall health of the economy and may be adversely affected by, among other things, the growth of alternative forms of retailing, bankruptcy, departure or cessation of operations of a tenant, a shift in consumer demand due to demographic changes, spending patterns and lease terminations. |
– | Office Properties Office properties are affected by the overall health of the economy, and other factors such as a downturn in the businesses operated by their tenants, obsolescence andnon-competitiveness. |
– | Hotel Properties The risks of hotel properties include, among other things, the necessity of a high level of continuing capital expenditures, competition, increases in operating costs which may not be offset by increases in revenues, dependence on business and commercial travelers and tourism, increases in fuel costs and other expenses of travel, and adverse effects of general and local economic conditions. Hotel properties tend to be more sensitive to adverse economic conditions and competition than many other commercial properties. |
– | Healthcare Properties Healthcare properties and healthcare providers are affected by several significant factors, including federal, state and local laws governing licenses, certification, adequacy of care, pharmaceutical distribution, rates, equipment, personnel and other factors regarding operations, continued availability of revenue from government reimbursement programs, and competition on a local and regional basis. The failure of any healthcare operator to comply with governmental laws and regulations may affect its ability to operate its facility or receive government reimbursements. |
– | Multifamily Properties The value and successful operation of a multifamily property may be affected by a number of factors such as the location of the property, the ability of the management team, the level of mortgage rates, the presence of competing properties, adverse economic conditions in the locale, oversupply and rent control laws or other laws affecting such properties. |
– | Community Shopping Centers Community center properties are dependent upon the successful operations and financial condition of their tenants, particularly certain of their major tenants, and could be adversely affected by bankruptcy of those tenants. In some cases, a tenant may lease a significant portion of the space in one center, and the filing of bankruptcy could cause significant revenue loss. Like others in the commercial real estate industry, community centers are subject to environmental risks and interest rate risk. They also face the need to enter into new leases or renew leases on favorable terms to generate rental revenues. Community center properties could be adversely affected by changes in the local markets where their properties are located, as well as by adverse changes in national economic and market conditions. |
– | Self-Storage Properties The value and successful operation of a self-storage property may be affected by a number of factors, such as the ability of the management team, the location of the property, the presence of competing properties, changes in traffic patterns, and adverse effects of general and local economic conditions with respect to rental rates and occupancy levels. |
Annual Report 2022 CBRE Global Real Estate Income Fund | Confidential & Proprietary | 9 |
– | Industrial Properties Industrial properties typically include warehouses, depots, storage, factories, logistics and distributions. Factors such as vacancy, tenant mix, lease term, property condition and design, redevelopment opportunities and property location could adversely affect the value and operation of industrial properties. |
– | Towers Companies Cell towers and wireless services have seen an increased demand in recent years. However, owners and operators of towers may be subject to, and therefore must comply with, environmental laws that impose strict, joint and several liability for the cleanup ofon-site oroff-site contamination and related personal injury or property damage. |
– | Data Centers Properties Data centers facilities house an organization’s most critical and proprietary assets. Therefore, operation of data centers properties depends upon the demand for technology-related real estate and global economic conditions that could adversely affect companies’ abilities to lease, develop or renew leases. Declining real estate valuations and impairment charges could adversely affect earnings and financial condition of data center properties. |
– | Net Lease Properties Net lease properties require the tenant to pay (in addition to the rent) property taxes, insurance, and maintenance on the property. Tenant’s ability to pay rent, interest rate fluctuations, vacancy, property location, length of the lease are only few of the risks that could affect net lease properties operations. |
– | Lack of Insurance Certain of the portfolio companies may fail to carry comprehensive liability, fire, flood, earthquake extended coverage and rental loss insurance, or insurance in place may be subject to various policy specifications, limits and deductibles. Should any type of uninsured loss occur, the portfolio company could lose its investment in, and anticipated profits and cash flows from, a number of properties and as a result adversely affect the Trust’s investment performance. |
– | Financial Leverage Global real estate companies may be highly leveraged and financial covenants may affect the ability of global real estate companies to operate effectively. |
– | Environmental Issues In connection with the ownership (direct or indirect), operation, management and development of real properties that may contain hazardous or toxic substances, a portfolio company may be considered an owner, operator or responsible party of such properties and, therefore, may be potentially liable for removal or remediation costs, as well as certain other costs, including governmental fines and liabilities for injuries to persons and property. The existence of any such material environmental liability could have a material adverse effect on the results of operations and cash flow of any such portfolio company and, as a result, the amount available to make distributions on shares of the Trust could be reduced. |
– | Recent Events The value of real estate is particularly susceptible to acts of terrorism and other changes in foreign and domestic conditions. |
– | Acts of God and Geopolitical Risks The performance of certain investments could be affected by acts of God or other unforeseen and/or uncontrollable events (collectively, “disruptions”), including, but not limited to, natural disasters, public health emergencies (including any outbreak or threat ofCOVID-19, SARS, H1N1/09 flu, avian flu, other coronavirus, Ebola, or other existing or new pandemic or epidemic diseases), terrorism, social and political discord, geopolitical events, national and international political circumstances, and other unforeseen and/or uncontrollable events with widespread impact. These disruptions may affect the level and volatility of security prices and liquidity of any investments. Unexpected volatility could impair an investment’s profitability or result in it suffering losses. Economies and financial markets throughout the world are becoming increasingly interconnected, which increases the likelihood that events or conditions in one country or region will adversely impact markets or securities industry participants in other countries or regions. |
– | REIT Issues REITs are subject to a highly technical and complex set of provisions in the Code. It is possible that the Trust may invest in a real estate company which purports to be a REIT, but which fails to qualify as a REIT. In the event of any such unexpected failure to qualify as a REIT, the purported REIT would be subject to corporate-level taxation, significantly reducing the return to the Trust on its investment in such company. |
Annual Report 2022 CBRE Global Real Estate Income Fund | Confidential & Proprietary | 10 |
– | the likelihood of greater volatility of net asset value and market price of the common shares because changes in the value of the Trust’s portfolio, including securities bought with the proceeds of the leverage, are borne entirely by the holders of common shares; and |
– | the possibility either that common share net investment income will fall if the leverage expense rises or that common share net investment income will fluctuate because the leverage expense varies. |
– | Deferral Preferred securities may include provisions that permit the issuer, at its discretion, to defer distributions for a stated period without any adverse consequences to the issuer. If the Trust owns a preferred security that is deferring its distributions, the Trust may be required to report income for tax purposes although it has not yet received such income. |
– | Subordination Preferred securities are subordinated to bonds and other debt instruments in a company’s capital structure with respect to priority to corporate income and liquidation payments, and therefore will be subject to greater credit risk than more senior debt instruments. |
– | Liquidity Preferred securities may be substantially less liquid than many other securities, such as common stocks or U.S. government securities. |
– | Limited Voting Rights Generally, preferred security holders (such as the Trust) have no voting rights with respect to the issuing company unless preferred dividends have been in arrears for a specified number of periods, at which time the preferred security holders may elect a number of directors to the issuer’s board. Generally, once all the arrearages have been paid, the preferred security holders no longer have voting rights. In the case of certain trust preferred securities, |
Annual Report 2022 CBRE Global Real Estate Income Fund | Confidential & Proprietary | 11 |
holders generally have no voting rights, except (i) if the issuer fails to pay dividends for a specified period of time or (ii) if a declaration of default occurs and is continuing. In such an event, rights of holders of trust preferred securities generally would include the right to appoint and authorize a trustee to enforce the trust or special purpose entity’s rights as a creditor under the agreement with its operating company. |
– | Special Redemption Rights In certain varying circumstances, an issuer of preferred securities may redeem the securities prior to a specified date. For instance, for certain types of preferred securities, a redemption may be triggered by a change in Federal income tax or securities laws. As with call provisions, a redemption by the issuer may negatively impact the return on the security held by the Trust. |
– | New Types of Securities From time to time, preferred securities, including trust preferred securities, have been, and may in the future be, offered having features other than those described herein. The Trust reserves the right to invest in these securities if the Adviser believes that doing so would be consistent with the Trust’s investment objectives and policies. Since the market for these instruments would be new, the Trust may have difficulty disposing of them at a suitable price and time. In addition to limited liquidity, these instruments may present other risks, such as high price volatility. |
Annual Report 2022 CBRE Global Real Estate Income Fund | Confidential & Proprietary | 12 |
Annual Report 2022 CBRE Global Real Estate Income Fund | Confidential & Proprietary | 13 |
Shares | Market value | |||||||||||||||
Real Estate Securities* – 145.2% | ||||||||||||||||
Common Stock – 136.9% | ||||||||||||||||
Australia – 4.4% | ||||||||||||||||
830,420 | Charter Hall Group | $ | 6,746,529 | |||||||||||||
1,525,133 | Dexus | 8,015,584 | ||||||||||||||
665,063 | Goodman Group | 7,829,577 | ||||||||||||||
5,194,461 | Scentre Group | 10,145,156 | ||||||||||||||
32,736,846 | ||||||||||||||||
Belgium – 2.7% | ||||||||||||||||
141,614 | Aedifica SA | 11,456,196 | ||||||||||||||
93,958 | Cofinimmo SA | 8,393,136 | ||||||||||||||
19,849,332 | ||||||||||||||||
Canada – 5.3% | ||||||||||||||||
176,498 | Canadian Apartment Properties REIT | 5,559,567 | ||||||||||||||
728,500 | Chartwell Retirement Residences | 4,537,835 | ||||||||||||||
939,900 | H&R Real Estate Investment Trust | 8,400,449 | ||||||||||||||
850,000 | RioCan Real Estate Investment Trust | 13,255,471 | ||||||||||||||
919,396 | Tricon Residential, Inc. | 7,088,543 | ||||||||||||||
38,841,865 | ||||||||||||||||
France – 3.5% | ||||||||||||||||
674,037 | Klepierre SA | 15,487,910 | ||||||||||||||
196,040 | Unibail-Rodamco-Westfield (a) | 10,174,522 | ||||||||||||||
25,662,432 | ||||||||||||||||
Germany – 0.9% | ||||||||||||||||
105,598 | LEG Immobilien SE | 6,858,872 | ||||||||||||||
Hong Kong – 7.2% | ||||||||||||||||
4,302,170 | Link REIT | 31,584,359 | ||||||||||||||
3,630,000 | New World Development Co. Ltd. | 10,231,968 | ||||||||||||||
4,382,000 | Swire Properties Ltd. | 11,138,941 | ||||||||||||||
52,955,268 | ||||||||||||||||
Japan – 13.0% | ||||||||||||||||
3,139 | Activia Properties, Inc. | 9,825,359 | ||||||||||||||
7,321 | AEON REIT Investment Corp. | 8,572,470 | ||||||||||||||
24,096 | Japan Metropolitan Fund Investment Corp. | 19,120,476 | ||||||||||||||
3,440 | Kenedix Office Investment Corp. | 8,342,870 | ||||||||||||||
10,619 | LaSalle Logiport REIT | 12,884,929 | ||||||||||||||
533,700 | Mitsui Fudosan Co., Ltd. | 9,776,444 |
Shares | Market value | |||||||||||||||
10,122 | Orix JREIT, Inc. | $ | 14,307,120 | |||||||||||||
2,685,592 | Tokyu Fudosan Holdings Corp. | 12,782,233 | ||||||||||||||
95,611,901 | ||||||||||||||||
Singapore – 4.0% | ||||||||||||||||
11,760,444 | �� | CapitaLand China Trust | 9,820,830 | |||||||||||||
9,348,612 | CapitaLand Integrated Commercial Trust | 14,219,481 | ||||||||||||||
8,338,000 | Keppel REIT | 5,657,307 | ||||||||||||||
29,697,618 | ||||||||||||||||
Spain – 1.5% | ||||||||||||||||
1,142,990 | Merlin Properties Socimi SA | 10,704,210 | ||||||||||||||
Sweden – 1.0% | ||||||||||||||||
594,254 | Castellum AB | 7,200,400 | ||||||||||||||
Switzerland – 0.8% | ||||||||||||||||
48,138 | PSP Swiss Property AG | 5,645,237 | ||||||||||||||
United Kingdom – 3.4% | ||||||||||||||||
1,452,922 | Grainger PLC | 4,404,277 | ||||||||||||||
1,313,897 | Land Securities Group PLC | 9,821,195 | ||||||||||||||
299,624 | Safestore Holdings PLC | 3,405,965 | ||||||||||||||
2,668,000 | Supermarket Income REIT PLC | 3,289,588 | ||||||||||||||
2,696,061 | Tritax Big Box REIT PLC | 4,494,948 | ||||||||||||||
25,415,973 | ||||||||||||||||
United States – 89.2% | ||||||||||||||||
160,730 | Alexandria Real Estate Equities, Inc. | 23,413,539 | ||||||||||||||
372,093 | Apartment Income REIT Corp. | 12,766,511 | ||||||||||||||
138,979 | AvalonBay Communities, Inc. | 22,447,888 | ||||||||||||||
692,559 | Brixmor Property Group, Inc. | 15,700,313 | ||||||||||||||
74,659 | Camden Property Trust | 8,352,849 | ||||||||||||||
213,685 | Crown Castle Inc. | 28,984,233 | ||||||||||||||
744,165 | CubeSmart | 29,952,641 | ||||||||||||||
186,930 | Digital Realty Trust, Inc. | 18,743,471 | ||||||||||||||
126,080 | Equinix, Inc. | 82,586,182 | ||||||||||||||
76,610 | Essex Property Trust, Inc. | 16,235,191 | ||||||||||||||
666,620 | Healthcare Realty Trust, Inc., Class A | 12,845,767 | ||||||||||||||
454,631 | Hudson Pacific Properties, Inc. | 4,423,560 | ||||||||||||||
418,300 | Independence Realty Trust, Inc. | 7,052,538 | ||||||||||||||
1,039,635 | Invitation Homes, Inc. | 30,814,781 |
Annual Report 2022 CBRE Global Real Estate Income Fund | Confidential & Proprietary | 15 |
Shares | Market value | |||||||||||||||
152,592 | Iron Mountain, Inc. | $ | 7,606,711 | |||||||||||||
252,901 | Life Storage, Inc. | 24,910,749 | ||||||||||||||
175,000 | National Storage Affiliates Trust | 6,321,000 | ||||||||||||||
714,776 | Park Hotels & Resorts, Inc. | 8,427,209 | ||||||||||||||
515,041 | Pebblebrook Hotel Trust | 6,896,399 | ||||||||||||||
696,892 | Piedmont Office Realty Trust, Inc., Class A | 6,390,500 | ||||||||||||||
718,154 | Prologis, Inc. | 80,957,501 | ||||||||||||||
36,040 | Public Storage | 10,098,048 | ||||||||||||||
581,300 | Retail Opportunity Investments Corp. | 8,736,939 | ||||||||||||||
505,000 | Rexford Industrial Realty, Inc. | 27,593,200 | ||||||||||||||
406,509 | Simon Property Group, Inc. | 47,756,677 | ||||||||||||||
585,007 | Spirit Realty Capital, Inc. | 23,359,330 | ||||||||||||||
463,690 | STAG Industrial, Inc. | 14,981,824 | ||||||||||||||
229,908 | Sun Communities, Inc. | 32,876,844 | ||||||||||||||
1,408,200 | Sunstone Hotel Investors, Inc. | 13,603,212 | ||||||||||||||
330,904 | Welltower, Inc. | 21,690,757 | ||||||||||||||
656,526,364 | ||||||||||||||||
Total Common Stock | ||||||||||||||||
(cost $1,220,083,460) | 1,007,706,318 | |||||||||||||||
Preferred Stock – 8.3% | ||||||||||||||||
United States – 8.3% | ||||||||||||||||
245,403 | Digital Realty Trust, Inc., Series J, 5.250% | 5,158,371 | ||||||||||||||
301,100 | Digital Realty Trust, Inc., Series L, 5.200% | 6,085,231 | ||||||||||||||
282,200 | Federal Realty Investment Trust, Series C, 5.000% | 5,694,796 | ||||||||||||||
405,900 | National Storage Affiliates Trust, Series A, 6.000% | 9,073,894 | ||||||||||||||
383,644 | Pebblebrook Hotel Trust, Series E, 6.375% | 6,878,737 | ||||||||||||||
541,950 | Pebblebrook Hotel Trust, Series F, 6.300% | 9,646,710 | ||||||||||||||
262,125 | Pebblebrook Hotel Trust, Series G, 6.375% | 4,770,675 | ||||||||||||||
143,517 | Rexford Industrial Realty, Inc., Series B, 5.875% | 3,187,513 |
Shares | Market value | |||||||||||||||
287,077 | Summit Hotel Properties, Inc., Series E, 6.250% | $ | 5,247,767 | |||||||||||||
265,000 | Sunstone Hotel Investors, Inc., Series H, 6.125% | 5,141,000 | ||||||||||||||
Total Preferred Stock | ||||||||||||||||
(cost $75,326,029) | 60,884,694 | |||||||||||||||
Total Investments – 145.2% | ||||||||||||||||
(cost $1,295,409,489) | 1,068,591,012 | |||||||||||||||
Liabilities in Excess of Other Assets – (45.2)% | (332,580,200 | ) | ||||||||||||||
Net Assets - 100.0% | $ | 736,010,812 |
* | Includes U.S. Real Estate Investment Trusts (“REIT”) and Real Estate Operating Companies (“REOC”) as well as entities similarly formed under the laws of non-U.S. countries. |
(a) | Non-income producing security. |
Annual Report 2022 CBRE Global Real Estate Income Fund | Confidential & Proprietary | 16 |
Assets | Level 1 | Level 2 | Level 3 | Total | ||||||||||||
INVESTMENT IN REAL ESTATE SECURITIES | ||||||||||||||||
Common Stock | ||||||||||||||||
Australia | $ | 32,736,846 | $ | - | $ | - | $ | 32,736,846 | ||||||||
Belgium | 19,849,332 | - | - | 19,849,332 | ||||||||||||
Canada | 38,841,865 | - | - | 38,841,865 | ||||||||||||
France | 25,662,432 | - | - | 25,662,432 | ||||||||||||
Germany | 6,858,872 | - | - | 6,858,872 | ||||||||||||
Hong Kong | 52,955,268 | - | - | 52,955,268 | ||||||||||||
Japan | 95,611,901 | - | - | 95,611,901 | ||||||||||||
Singapore | 29,697,618 | - | - | 29,697,618 | ||||||||||||
Spain | 10,704,210 | - | - | 10,704,210 | ||||||||||||
Sweden | 7,200,400 | - | - | 7,200,400 | ||||||||||||
Switzerland | 5,645,237 | - | - | 5,645,237 | ||||||||||||
United Kingdom | 25,415,973 | - | - | 25,415,973 | ||||||||||||
United States | 656,526,364 | - | - | 656,526,364 | ||||||||||||
Total Common Stock | 1,007,706,318 | - | - | 1,007,706,318 | ||||||||||||
Preferred Stock | ||||||||||||||||
United States | 60,884,694 | - | - | 60,884,694 | ||||||||||||
TOTAL INVESTMENT IN REAL ESTATE SECURITIES | $ | 1,068,591,012 | $ | - | $ | - | $ | 1,068,591,012 |
Annual Report 2022 CBRE Global Real Estate Income Fund | Confidential & Proprietary | 17 |
December 31, 2022 | ||||
Assets | ||||
Investments, at value (cost $1,295,409,489) | $ | 1,068,591,012 | ||
Cash and cash equivalents | 200,254 | |||
Receivable for investment securities sold | 9,936,848 | |||
Dividends and interest receivable | 4,585,672 | |||
Dividend withholding reclaims receivable | 531,630 | |||
Unrealized appreciation on spot contracts | 1,557 | |||
Other assets | 119,662 | |||
Total assets | 1,083,966,635 | |||
Liabilities | ||||
Line of credit payable | 345,209,400 | |||
Line of credit interest payable | 1,394,831 | |||
Management fees payable | 785,590 | |||
Dividend and distributions payable | 200,162 | |||
Accrued expenses | 365,840 | |||
Total liabilities | 347,955,823 | |||
NET ASSETS | $ | 736,010,812 | ||
Composition of Net Assets | ||||
$0.001 par value per share; | ||||
Unlimited number of shares authorized | ||||
116,590,494 shares issued and outstanding | $ | 116,590 | ||
Additional paid-in capital | 939,656,023 | |||
Distributable earnings / (accumulated loss) | (203,761,801) | |||
NET ASSETS | $ | 736,010,812 | ||
NET ASSET VALUE | ||||
(BASED ON 116,590,494 SHARES OUTSTANDING) | $ | 6.31 |
Annual Report 2022 CBRE Global Real Estate Income Fund | Confidential & Proprietary | 18 |
For the year ended December 31, 2022 | ||||
Investment Income | ||||
Dividends (net of foreign withholding taxes of $1,636,902) | $41,863,823 | |||
Non-cash dividends (net of foreign withholding taxes of $77,348) | 2,275,127 | |||
Interest | 1,186 | |||
Total investment income | 44,140,136 | |||
Expenses | ||||
Management fees | 10,785,803 | |||
Interest expense on line of credit | 8,337,658 | |||
Printing and mailing fees | 499,095 | |||
Legal fees | 290,426 | |||
Administration fees | 263,783 | |||
Custodian fees | 221,414 | |||
Trustees’ fees and expenses | 217,510 | |||
Insurance fees | 175,933 | |||
NYSE listing fee | 122,004 | |||
Audit and tax fees | 90,001 | |||
Transfer agent fees | 71,999 | |||
Miscellaneous expenses | 52,563 | |||
Total expenses | 21,128,189 | |||
NET INVESTMENT INCOME | 23,011,947 | |||
Net Realized and Unrealized Gain (Loss) on Investments, Written Options, and Foreign Currency Transactions | ||||
Net realized gain (loss) on: | ||||
Investments | 66,473,732 | |||
Written options | 1,364,517 | |||
Foreign currency transactions | (307,711) | |||
Total Net Realized Gain | 67,530,538 | |||
Net change in unrealized appreciation (depreciation) on: | ||||
Investments | (494,518,953) | |||
Foreign currency denominated assets and liabilities | (8,463) | |||
Total Net Change in Unrealized Depreciation | (494,527,416) | |||
NET REALIZED AND UNREALIZED LOSS ON INVESTMENTS, WRITTEN OPTIONS, AND FOREIGN CURRENCY TRANSACTIONS | (426,996,878) | |||
NET DECREASE IN NET ASSETS RESULTING FROM OPERATIONS | $(403,984,931) |
Annual Report 2022 | Confidential & Proprietary | 19 |
For the year ended December 31, 2022 | For the year ended December 31, 2021 | |||||||
Change in Net Assets Resulting from Operations | ||||||||
Net investment income | $23,011,947 | $25,536,872 | ||||||
Net realized gain on investments, written options, and foreign currency transactions | 67,530,538 | 171,081,125 | ||||||
Net change in unrealized appreciation (depreciation) on investments, and foreign currency denominated assets and liabilities | (494,527,416) | 149,751,153 | ||||||
Net increase (decrease) in net assets resulting from operations | (403,984,931) | 346,369,150 | ||||||
Distributions on Common Shares | ||||||||
Distributions from distributable earnings | (81,613,345) | (69,954,297) | ||||||
Total distributions on common shares | (81,613,345) | (69,954,297) | ||||||
Net Increase (Decrease) in Net Assets | (485,598,276) | 276,414,853 | ||||||
Net Assets | ||||||||
Beginning of year | 1,221,609,088 | 945,194,235 | ||||||
End of Year | $736,010,812 | $1,221,609,088 |
Annual Report 2022 | Confidential & Proprietary | 20 |
For the year ended December 31, 2022 | ||||
Cash Flows from Operating Activities | ||||
Net decrease in net assets resulting from operations | $(403,984,931) | |||
Adjustments to Reconcile Net Decrease in Net Assets Resulting from Operations to Net Cash Provided by Operating Activities | ||||
Net change in unrealized appreciation/depreciation on investments | 494,518,953 | |||
Net realized gain on investments | (66,473,732) | |||
Net realized gain on written options | (1,364,517) | |||
Cost of securities purchased | (685,276,848) | |||
Proceeds from sale of securities | 732,862,197 | |||
Premiums received on written options | 1,969,241 | |||
Increase in receivable for investment securities sold | (7,408,218) | |||
Decrease in dividends and interest receivable | 1,483,150 | |||
Increase in dividend withholding reclaims receivable | (83,337) | |||
Increase in unrealized appreciation on spot contracts | (1,557) | |||
Decrease in payable for investment securities purchased | (10,314,288) | |||
Decrease in management fees payable | (265,175) | |||
Increase in line of credit interest payable | 1,187,503 | |||
Decrease in unrealized depreciation on spot contracts | (12,959) | |||
Increase in accrued expenses | 57,305 | |||
NET CASH PROVIDED BY OPERATING ACTIVITIES | 56,892,787 | |||
Cash Flows from Financing Activities: | ||||
Cash distributions paid on Common Shares | (81,570,021) | |||
Proceeds from borrowing on line of credit | 378,658,600 | |||
Payments on line of credit borrowings | (353,938,000) | |||
NET CASH USED IN FINANCING ACTIVITIES | (56,849,421) | |||
Net Increase in Cash | 43,366 | |||
Cash and Cash Equivalents at Beginning of Year | 156,888 | |||
CASH AND CASH EQUIVALENTS AT END OF YEAR | $ 200,254 | |||
Supplemental Disclosure | ||||
Interest paid on line of credit borrowings | $7,150,155 |
Annual Report 2022 | Confidential & Proprietary | 21 |
For the Year Ended December 31, 2022 | For the Year Ended December 31, 2021 | For the Year Ended December 31, 2020 | For the Year Ended December 31, 2019 | For the Year Ended December 31, 2018 | ||||||||||||||||
Per share operating performance for a share outstanding throughout the year | ||||||||||||||||||||
Net asset value, beginning of year | $10.48 | $8.11 | $8.86 | $7.55 | $8.99 | |||||||||||||||
Income from investment operations | ||||||||||||||||||||
Net investment income (1) | 0.20 | 0.22 | 0.17 | 0.16 | 0.19 | |||||||||||||||
Net realized and unrealized gain (loss) on investments, written options and foreign currency transactions | (3.67) | 2.75 | (0.32) | 1.75 | (1.03) | |||||||||||||||
Total from investment operations | (3.47) | 2.97 | (0.15) | 1.91 | (0.84) | |||||||||||||||
Distributions on Common Shares | ||||||||||||||||||||
Net investment income | (0.21) | (0.08) | (0.21) | (0.30) | (0.17) | |||||||||||||||
Net realized gains | (0.49) | (0.52) | – | – | – | |||||||||||||||
Return of capital | – | – | (0.39) | (0.30) | (0.43) | |||||||||||||||
Total distributions to common shareholders | (0.70) | (0.60) | (0.60) | (0.60) | (0.60) | |||||||||||||||
NET ASSET VALUE, END OF YEAR | $6.31 | $10.48 | $8.11 | $8.86 | $7.55 | |||||||||||||||
MARKET VALUE, END OF YEAR | $5.73 | $9.79 | $6.88 | $8.02 | $6.16 | |||||||||||||||
Total investment return (2) | ||||||||||||||||||||
Net asset value | (33.97)% | 37.88% | (0.74)% | 25.74% | (9.75)% | |||||||||||||||
Market value | (35.54)% | 52.66% | (5.52)% | 40.87% | (15.52)% | |||||||||||||||
Ratios and supplemental data | ||||||||||||||||||||
Net assets, applicable to common shares, end of year (thousands) | $736,011 | $1,221,609 | $945,194 | $1,032,890 | $880,636 | |||||||||||||||
Borrowings (senior securities) outstanding, end of year (thousands) | $345,209 | $320,489 | $289,727 | $121,020 | $74,111 | |||||||||||||||
Asset Coverage per $1,000 (3) | $3,132 | $4,812 | $4,262 | $9,535 | $12,883 | |||||||||||||||
Ratios to average net assets applicable to common shares of: | ||||||||||||||||||||
Net expenses | 2.29% | 1.46% | 1.53% | 1.57% | 1.54% | |||||||||||||||
Net expenses, excluding interest on line of credit | 1.39% | 1.24% | 1.26% | 1.16% | 1.17% | |||||||||||||||
Net investment income | 2.49% | 2.37% | 2.25% | 1.89% | 2.30% | |||||||||||||||
Portfolio turnover rate | 53.88% | 78.44% | 72.50% | 44.97% | 70.38% | |||||||||||||||
(1) | Based on average shares outstanding. |
(2) | Total investment return does not reflect brokerage commissions. Dividends and distributions are assumed to be reinvested at the prices obtained under the Trust’s Dividend Reinvestment Plan. Net Asset Value (“NAV”) total return is calculated assuming reinvestment of distributions at NAV on the date of the distribution. |
(3) | Asset Coverage per $1,000: Asset coverage per $1,000 of debt is calculated by subtracting the Trust’s liabilities and indebtedness not represented by senior securities from the Trust’s total assets, dividing the result by the aggregate amount of the Trust’s senior securities representing indebtedness then outstanding, and multiplying the result by 1,000. |
Annual Report 2022 | Confidential & Proprietary | 22 |
1 | FUND ORGANIZATION |
2 | SIGNIFICANT ACCOUNTING POLICIES |
Annual Report 2022 | Confidential & Proprietary | 24 |
(i) | market value of investment securities, other assets and liabilities – at the current rates of exchange; |
(ii) | purchases and sales of investment securities, income and expenses – at the rate of exchange prevailing on the respective dates of such transactions. |
Annual Report 2022 | Confidential & Proprietary | 25 |
Annual Report 2022 | Confidential & Proprietary | 26 |
3 | DERIVATIVE INSTRUMENTS |
Realized gain | ||||
EQUITY RISK | ||||
Written options | $1,364,517 |
4 | CONCENTRATION OF RISK |
5 | INVESTMENT MANAGEMENT AGREEMENT AND OTHER AGREEMENTS |
6 | PORTFOLIO SECURITIES |
Annual Report 2022 | Confidential & Proprietary | 27 |
7 | FEDERAL INCOME TAXES |
Annual Report 2022 | Confidential & Proprietary | 28 |
Cost of investments for tax purposes | Gross tax unrealized appreciation | Gross tax unrealized depreciation | Net tax unrealized depreciation on investments | Net tax unrealized depreciation on foreign currency | Qualified late year ordinary losses | Qualified post- October capital deferral | Undistributed ordinary income | Undistributed long-term Capital gains / (accumulated capital loss) | ||||||||
$1,298,126,318 | $21,690,101 | $(251,225,407) | $(229,535,306) | $(10,851) | $0 | $0 | $20,029,505 | $5,754,851 |
8 | BORROWINGS |
9 | CAPITAL |
10 | INDEMNIFICATIONS |
11 | SUBSEQUENT EVENTS |
Annual Report 2022 | Confidential & Proprietary | 29 |
![LOGO](https://capedge.com/proxy/N-CSR/0001193125-23-043544/g359486g93b77.jpg)
Annual Report 2022 | Confidential & Proprietary | 31 |
Number of shares in favor | Number of shares withheld | |||||||
John R. Bartholdson | 88,844,968.840 | 5,950,902.295 | ||||||
Leslie E. Greis | 89,124,454.075 | 5,671,417.060 |
Annual Report 2022 | Confidential & Proprietary | 33 |
Name, address and age | Term of office and length of time served (1) | Title | Principal occupations during the past five years | Number of portfolios in the Trust complex overseen by Trustee | Other directorships held by trustee | |||||
Trustees: | ||||||||||
T. Ritson Ferguson (2) 201 King of Prussia Road, Suite 600 Radnor, PA 19087 Age: 63 | 3 years/ since inception | Trustee (3) | Senior Fellow Wharton Real Estate Center (since 2022); Investment Committee Member of CBRE Investment Management Listed Real Assets LLC (since 2022); Vice Chairman of CBRE Investment Management Listed Real Assets LLC (2021) (Retired); Chief Executive Officer and Co-Chief Investment Officer of CBRE Clarion Securities LLC (1995-2020); Chief Executive Officer, Chief Investment Officer and Global Chief Investment Officer of CBRE Global Investors (2015-2019) | 1 | Duke Management Company (DUMAC) (since 2018) | |||||
Asuka Nakahara 201 King of Prussia Road, Suite 600 Radnor, PA 19087 Age: 67 | 3 years/ since inception | Trustee | Associate Director of the Zell-Lurie Real Estate Center at the Wharton School, University of Pennsylvania (since 1999); Practice Professor of Real Estate at the Wharton School, University of Pennsylvania (since 1999); Partner of Triton Atlantic Partners (since 2009) | 1 | Rice Management Company (since 2022); Comcast Corporation (since 2017) | |||||
John R. Bartholdson 201 King of Prussia Road, Suite 600 Radnor, PA 19087 Age: 78 | 3 years/ 18 years | Trustee/ Audit Committee Financial Expert | Senior Vice President, CFO and Treasurer, and a Director of Triumph Group, Inc. (1993-2007) (Retired) | 1 | Berwyn Cornerstone Fund, Berwyn Income Fund, and Berwyn Fund (2013-2016) | |||||
Leslie E. Greis 201 King of Prussia Road, Suite 600 Radnor, PA 19087 Age: 64 | 3 years/ 4 years | Trustee | Founder and Managing Member of Perennial Capital Advisors, LLC (since 2003) | 1 | AIM Mutual, Inc. (2016); Kinefac Corporation (since 2009) |
Annual Report 2022 | Confidential & Proprietary | 34 |
Name, address and age | Term of office and length of time served (1) | Title | Principal occupations during the past five years | Number of portfolios in the Trust complex overseen by Trustee | Other directorships held by trustee | |||||
Trustees: | ||||||||||
Heidi Stam 201 King of Prussia Road, Suite 600 Radnor, PA 19087 Age: 66 | 3 years/ 2 years | Trustee | Managing Director and General Counsel, The Vanguard Group, Inc. (2005-2016) (Retired) | 1 | Bridge Builder Trust (since 2022); Edward Jones Money Market Fund (since 2022); Investor Advisory Committee, U.S. Securities and Exchange Commission (2017-2021); National Adjudicatory Council, FINRA (2017-2021) |
(1) | Each Trustee is elected to serve a three-year term concurrent with the class of Trustees to which he or she belongs. Mr. Ferguson and Ms. Stam, as Class I Trustees, are currently serving a term expiring at the Trust’s 2023 annual meeting of shareholders. Mr. Nakahara, as Class II Trustee, is currently serving a term expiring at the Trust’s 2024 annual meeting of shareholders. Mr. Bartholdson and Ms. Greis, as Class III Trustees, are currently serving a term expiring at the Trust’s 2025 annual meeting of shareholders. |
(2) | Mr. Ferguson is deemed to be an interested person of the Trust as defined in the Investment Company Act of 1940 (the “1940 ACT”), as amended, due to his previous position with the Adviser, and his engagement as an external consultant to the Adviser, which began on January 1, 2022. |
(3) | Effective January 1, 2022, Mr. Ferguson stepped down from his responsibilities as the President and Chief Executive Officer of the Trust, in conjunction with his retirement from the Trust’s Adviser. |
Name, Address, Age and Position(s) Held with Registrant Officers: | Length of Time Served | Principal Occupations During the Past Five Years and Other Affiliations | ||
Joseph P. Smith 201 King of Prussia Road, Suite 600 Radnor, PA 19087 Age: 55 President and Chief Executive Officer | Since 2022 1 | Chief Investment Officer-Listed Real Assets of CBRE Investment Management Listed Real Assets LLC (since 2021); Co-Chief Investment Officer of CBRE Clarion Securities LLC (2016-2020) | ||
Jonathan A. Blome 201 King of Prussia Road, Suite 600 Radnor, PA 19087 Age: 45 Chief Financial Officer | since 2006 | Chief Operating Officer of CBRE Investment Management Listed Real Assets LLC (since 2021); Chief Financial Officer and Director of Operations of CBRE Investment Management Listed Real Assets LLC (since 2011) | ||
Robert S. Tull III 201 King of Prussia Road, Suite 600 Radnor, PA 19087 Age: 45 Outgoing Chief Compliance Officer and Secretary | 2019-2022 | Chief Compliance Officer of CBRE Investment Management Listed Real Assets LLC (2010-2022); Compliance Officer of CBRE Clarion Securities LLC (2008-2010); Global Chief Compliance Officer for CBRE Global Investors (2017-2018) | ||
Jeff Chang 201 King of Prussia Road, Suite 600 Radnor, PA 19087 Age: 49 Chief Compliance Officer and Secretary | since 2023 2 | Chief Compliance Officer of CBRE Investment Management Listed Real Assets LLC (since 2023); Chief Compliance Officer of First Quadrant, LP (2012-2022) |
1 | Effective January 1, 2022, Mr. Smith assumed responsibilities as the President and Chief Executive Officer of the Trust; he maintains his role as Portfolio Manager of the Trust. |
2 | Effective January 1, 2023, Mr. Chang assumed responsibilities as the Chief Compliance Officer and Secretary of the Trust. |
Annual Report 2022 | Confidential & Proprietary | 35 |
Annual Report 2022 CBRE Global Real Estate Income Fund | Confidential & Proprietary | 36 |
Annual Report 2022 CBRE Global Real Estate Income Fund | Confidential & Proprietary | 37 |
Annual Report 2022 CBRE Global Real Estate Income Fund | Confidential & Proprietary | 38 |
![LOGO](https://capedge.com/proxy/N-CSR/0001193125-23-043544/g359486g67w40.jpg)
(b) | Not applicable |
Item 2. | Code of Ethics. |
(a) | The Trust, as of the end of the period covered by this report, has adopted a Code of Ethics for Senior Financial Officers (the “Financial Officer Code of Ethics”) that applies to the Trust’s principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions, regardless of whether these individuals are employed by the Trust or a third party. |
(b) | Not applicable. |
(c) | There have been no amendments, during the period covered by this report, to a provision of the Financial Officer Code of Ethics that applies to the Trust’s principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions, regardless of whether these individuals are employed by the Trust or a third party, and that relates to any element of the code of ethics description. |
(d) | The Trust has not granted any waivers, including an implicit waiver, from a provision of the Financial Officer Code of Ethics that applies to the Trust’s principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions, regardless of whether these individuals are employed by the Trust or a third party, that relates to one or more of the items set forth in paragraph (b) of this item’s instructions. |
(e) | Not applicable. |
(f) | The Trust’s Financial Officer Code of Ethics is attached hereto as an exhibit. |
Item 3. | Audit Committee Financial Expert. |
All of the members of the audit committee have the business and financial experience necessary to understand the fundamental financial statements of a closed-end, registered investment company; further, each member of the committee is financially literate, as such qualification is interpreted by the Board of Trustees in its business judgment. In addition, the Board has determined that John R. Bartholdson is an “audit committee financial expert” and “independent” as those terms are defined in Item 3 of Form N-CSR.
Item 4. | Principal Accountant Fees and Services. |
• | Registrant may incorporate the following information by reference, if this information has been disclosed in the registrant’s definitive proxy statement or definitive information statement. The proxy statement or information statement must be filed no later than 120 days after the end of the fiscal year covered by the Annual Report. |
Audit Fees
(a) | The aggregate fees billed for each of the last two fiscal years for professional services rendered by the principal accountant for the audit of the Trust’s annual financial statements or services that are normally provided by the accountant in connection with statutory and regulatory filings or engagements for those fiscal years are $66,000 for 2022 and $60,000 for 2021. |
Audit-Related Fees
(b) | The aggregate fees billed in each of the last two fiscal years for assurance and related services by the principal accountant that are reasonably related to the performance of the audit of the Trust’s financial statements and are not reported under paragraph (a) of this Item are $0 for 2022 and $0 for 2021. |
Tax Fees
(c) | The aggregate fees billed in each of the last two fiscal years for professional services rendered by the principal accountant for tax compliance, tax advice, and tax planning are $24,000 for 2022 and $24,000 for 2021. Services include income tax return services including the review and signing of the Trust’s Form 1120-RIC as prepared by the Trust’s administrator. |
All Other Fees
(d) | The aggregate fees billed in each of the last two fiscal years for products and services provided by the principal accountant, other than the services reported in paragraphs (a) through (c) of this Item are $12,000 for 2022 and $0 for 2021. [These services consisted of certain filings to reclaim taxes paid to European countries by the Trust.] |
(e)(1) | (i) The Trust has an Audit Committee Charter in place (the “Charter”) that governs the pre-approval by the Trust’s Audit Committee of all engagements for audit services and all Covered Non-Audit Engagements (as defined in the Charter) provided by the Trust’s independent auditor (the “Independent Auditor”) to the Trust and other “Related Entities” (as defined below). Each calendar year, the Audit Committee will review and re-approve the Charter, together with any changes deemed necessary or desirable by the Audit Committee. The Audit Committee may, from time to time, modify the nature of the services pre-approved, the aggregate level of fees pre-approved, or both. |
“Related Entities” means (i) CBRE Investment Management Listed Real Assets LLC (the “Advisor”) or (ii) any entity controlling, controlled by or under common control with the Advisor.
Pre-approval shall be required only with respect to non-audit services (i) related directly to the operations and financial reporting of the Trust and (ii) provided to a Related Entity that furnishes ongoing services to the Trust. Such pre-approval shall not apply to non-audit services provided to any sub-adviser whose role is primarily portfolio management and is subcontracted with or overseen by another investment adviser. Pre-approval by the Audit Committee of such non-audit services shall be effected pursuant to the pre-approval procedures described in the Charter. The Charter shall not be violated if pre-approval of any such non-audit service is not obtained in circumstances in which the pre-approval requirement is waived under applicable rules promulgated by the Securities and Exchange Commission (“SEC”) or the NYSE, in accordance with the Sarbanes Oxley Act.
Requests for pre-approval of Covered Non-Audit Engagements are submitted to the Audit Committee by the Independent Auditor and by the chief financial officer of the Related Entity for which the non-audit services are to be performed. Such requests must include a statement as to whether, in the view of the Independent Auditor and such officer, (a) the request is consistent with the SEC’s rules on auditor independence and (b) the requested service is or is not a non-audit service prohibited by the SEC. A request submitted between scheduled meetings of the Audit Committee should state the reason that approval is being sought prior to the next regularly scheduled meeting of the Audit Committee.
Between regularly scheduled meetings of the Audit Committee, the Committee Chairman or Audit Committee Financial Expert shall have the authority to pre-approve Covered Non-Audit Engagements, provided that fees associated with such engagement do not exceed $10,000 and the services to be provided do not involve provision of any of the following services by the Independent Auditor: (i) bookkeeping or other services related to the accounting records or financial statements of the audit client; (ii) financial information systems design and implementation; (iii) appraisal or valuation services, fairness opinions, or contribution-in-kind reports; (iv) actuarial services; (v) internal audit outsourcing services; (vi) management functions; (vii) human resources; (vii) broker dealer, investment advisor or investment banking services; (ix) legal services; or (x) expert services unrelated to the audit.
Fee levels for all Covered Services to be provided by the Independent Auditor and pre-approved under this Policy will be established annually by the Audit Committee. Any increase in pre-approved fee levels will require specific pre-approval by the Audit Committee.
The terms and fees of the annual Audit services engagement for the Trust are subject to the specific pre-approval of the Audit Committee. The Audit Committee will approve, if necessary, any changes in terms, conditions or fees resulting from changes in audit scope, Trust structure or other matters.
(e)(2) | 100% percent of services described in each of paragraphs (b) through (d) of this Item were approved by the Trust’s audit committee pursuant to paragraph (c)(7)(i)(C) of Rule 2-01 of Regulation S-X. |
(f) | The percentage of hours expended on the principal accountant’s engagement to audit the Trust’s financial statements for the most recent fiscal year that were attributed to work performed by persons other than the principal accountant’s full-time, permanent employees was less than fifty percent. |
(g) | The aggregate non-audit fees billed by the Trust’s accountant for services rendered to the Trust, and rendered to the Trust’s investment adviser (not including any sub-adviser whose role is primarily portfolio management and is subcontracted with or overseen by another investment adviser), and any entity controlling, controlled by, or under common control with the adviser that provides ongoing services to the Trust for each of the last two fiscal years of the Trust was $326,000 for 2022 and $319,000 for 2021. |
(h) | The registrant’s audit committee of the board of trustees has considered whether the provision of non-audit services that were rendered to the registrant’s investment adviser (not including any sub-adviser whose role is primarily portfolio management and is subcontracted with or overseen by another investment adviser), and any entity controlling, controlled by, or under common control with the investment adviser that provides ongoing services to the registrant that were not pre-approved pursuant to paragraph (c)(7)(ii) of Rule 2-01 of Regulation S-X is compatible with maintaining the principal accountant’s independence. |
(i) | Not applicable. |
(j) | Not applicable. |
Item 5. | Audit Committee of Listed Registrants. |
(a) | The Trust has a separately designated audit committee consisting of all the independent trustees of the Trust. The members of the audit committee are: Asuka Nakahara, Leslie Greis, Heidi Stam and John R. Bartholdson. |
Item 6. | Investments. |
(a) | Schedule of Investments in securities of unaffiliated issuers as of the close of the reporting period is included as part of the report to shareholders filed under Item 1(a) of this form. |
(b) | Not applicable. |
Item 7. | Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies. |
The Trust has delegated the voting of proxies relating to its voting securities to the Advisor, pursuant to the proxy voting procedures of the Advisor. The Trust’s and the Advisor’s Proxy Voting Policies and Procedures are included as an exhibit hereto.
Item 8. | Portfolio Managers of Closed-End Management Investment Companies. |
As of February 21, 2023:
Joseph P. Smith
President and Chief Investment Officer – Listed Real Assets, CBRE Investment Management Listed Real Assets LLC (formerly named CBRE Clarion Securities LLC) since 1997
Kenneth S. Weinberg
Senior Portfolio Manager, CBRE Investment Management Listed Real Assets LLC (formerly named CBRE Clarion Securities LLC since 2004
Jonathan D. Miniman
Senior Portfolio Manager, CBRE Investment Management Listed Real Assets LLC (formerly named CBRE Clarion Securities LLC) since 2002
(a)(2) | Other Accounts Managed (as of December 31, 2022). |
The Portfolio Managers are also collectively responsible for the day-to-day management of the Advisor’s other accounts, as indicated by the following table.
Name of Portfolio Manager | Type of Accounts | Number of Accounts Managed | Total Assets in the Accounts | Managed with Advisory Fee Based on Performance | Managed with Advisory Fee Based on Performance | |||||||||||||
Joseph P. Smith | Registered Investment Companies | 8 | $ | 5,904,633,676.33 | 0 | |||||||||||||
Other Pooled Investment Vehicles | 10 | $ | 1,008,451,839.98 | 1 | $ | 25,434,036.87 | ||||||||||||
Other Accounts | 22 | $ | 1,550,007,528.59 | 6 | $ | 174,227,521.52 | ||||||||||||
Kenneth S. Weinberg | Registered Investment Companies | 5 | $ | 2,715,767,364.67 | 0 | |||||||||||||
Other Pooled Investment Vehicles | 2 | $ | 225,960,897.63 | 0 | ||||||||||||||
Other Accounts | 21 | $ | 1,547,284,888.47 | 5 | $ | 171,504,881.40 | ||||||||||||
Jonathan D. Miniman | Registered Investment Companies | 3 | $ | 1,595,764,371.62 | 0 | |||||||||||||
Other Pooled Investment Vehicles | 7 | $ | 577,100,701.30 | 0 | ||||||||||||||
Other Accounts | 7 | $ | 343,011,115.80 | 0 |
Potential Conflicts of Interests
A portfolio manager may be subject to potential conflicts of interest because the portfolio manager is responsible for other accounts in addition to the Trust. These other accounts may include, among others, other closed-end funds, mutual funds, separately managed advisory accounts, commingled trust accounts, insurance separate accounts, wrap fee programs, and private funds. Potential conflicts may arise out of the implementation of differing investment strategies for a portfolio manager’s various accounts, the allocation of investment opportunities among those accounts or differences in the advisory fees paid by the portfolio manager’s accounts.
A potential conflict of interest may arise as a result of a portfolio manager’s responsibility for multiple accounts with similar investment guidelines. Under these circumstances, a potential investment may be suitable for more than one of the portfolio manager’s accounts, but the quantity of the investment available for purchase is less than the aggregate amount the accounts would ideally devote to the opportunity. Similar conflicts may arise when multiple accounts seek to dispose of the same investment.
A portfolio manager may also manage accounts whose objectives and policies differ from those of the Trust. These differences may be such that under certain circumstances, trading activity appropriate for one account managed by the portfolio manager may have adverse consequences for another account managed by the portfolio manager. For example, if an account were to sell a significant position in a security, which could cause the market price of that security to decrease while the Trust maintained its position in that security.
A potential conflict may arise when a portfolio manager is responsible for accounts that have different advisory fees – the difference in the fees may create an incentive for the portfolio manager to favor one account over another, for example, in terms of access to particularly appealing investment opportunities. This conflict may be heightened where an account is subject to a performance-based fee.
The Advisor recognizes the duty of loyalty it owes to its clients and has established and implemented certain policies and procedures designed to control and mitigate conflicts of interest arising from the execution of a variety of portfolio management and trading strategies across the firm’s diverse client base. Such policies and procedures include, but are not limited to: (i) investment process, portfolio management, and trade allocation procedures; (ii) procedures regarding short sales in securities recommended for other clients; and (iii) procedures regarding personal trading by the firm’s employees (contained in the Code of Ethics).
(a)(3) | Compensation Structure of Portfolio Manager(s) or Management Team Members |
In principle, portfolio manager compensation is not based on the performance of any particular account, including the Trust, nor is compensation based on the level of Trust assets.
Compensation for each portfolio manager is structured as follows:
Base Salary—Each portfolio manager receives a base salary. Base salaries have been established at a competitive market levels and are set forth in the portfolio manager’s employment agreement. An annual adjustment is made based on changes in the consumer price index. Base salaries are be reviewed periodically by the Advisor’s Compensation Committee and its Board of Directors, but adjustments are expected to be relatively infrequent.
Bonus—Portfolio manager bonuses are drawn from an incentive compensation pool into which a significant percentage of Advisor’s pre-tax profits is set aside. Incentive compensation allocations are determined by the Compensation Committee based on a variety of factors, including the performance of particular investment strategies. To avoid the pitfalls of relying solely on a rigid performance format, however, incentive compensation decisions also take into account other important factors, such as the portfolio manager’s contribution to the team, firm, and overall investment process. Each of the portfolio managers is a member of the Committee. Incentive compensation allocations are reported to the Board of Directors, but the Board’s approval is not required.
Deferred Compensation—The Advisor requires deferral of a percentage of incentive compensation exceeding a certain threshold in respect of a single fiscal year. The Compensation Committee may, in its discretion, require the deferral of additional amounts. Such deferred amounts are subject to the terms of a Deferred Bonus Plan adopted by the Board of Directors. The purpose of the Deferred Bonus Plan is to foster the retention of key employees, to focus plan participants on value creation and growth and to encourage continued cooperation among key employees in providing services to the Advisor’s clients. The value of deferred bonus amounts is tied to the performance of the Advisor’s investment funds chosen by the Compensation Committee; provided, that the Committee may elect to leave a portion of the assets uninvested. Deferred compensation vests incrementally, one-third after 2 years, 3 years and 4 years. The Deferred Bonus Plan provides for forfeiture upon voluntary termination of employment, termination for cause or conduct detrimental to the firm.
Profit Participation—Each of the portfolio managers owns equity shares of the Advisor. The Advisor distributes its income to its owners each year, so each portfolio manager receives income distributions corresponding to their ownership share. Ownership is structured so that the owners receive an increasing share of the Advisor’s profit over time. In addition, an owner may forfeit a portion of their ownership if they resign voluntarily.
Other Compensation—Portfolio managers may also participate in benefit plans and programs available generally to all employees, such as CBRE Group’s 401(k) plan.
(a)(4) | Disclosure of Securities Ownership |
Name of Portfolio Managers | Dollar Value of Trust Shares Beneficially Owned | |||
Joseph P. Smith | $ | 100,001 to $500,000 | ||
Kenneth S. Weinberg | $ | 50,001 to $100,000 | ||
Jonathan D. Miniman | $ | 50,001 to $100,000 |
(b) | 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. |
Not applicable.
Item 11. | Controls and Procedures. |
(a) | The Trust’s principal executive officer and principal financial officer have evaluated the Trust’s disclosure controls and procedures within 90 days of this filing and have concluded that the Trust’s disclosure controls and procedures were effective, as of that date, in ensuring that information required to be disclosed by the Trust in this Form N-CSR was recorded, processed, summarized, and reported timely. |
(b) | The Trust’s principal executive officer and principal financial officer are aware of no changes in the Trust’s internal control over financial reporting that occurred during the Trust’s last fiscal quarter that has materially affected, or is reasonably likely to materially affect, the Trust’s internal control over financial reporting. |
Item 12. | Disclosure of Securities Lending Activities for Closed-End Management Investment Companies. |
Not applicable.
Item 13. | Exhibits. |
The Trust has received exceptive relief from the Securities and Exchange Commission permitting it to make periodic distributions of long-term capital gains with respect to its outstanding common stock as frequently as twelve times each year. This relief is conditioned, in part, on an undertaking by the Trust to make the disclosures to the holders of the Trust’s common shares, in addition to the information required by Section 19(a) of the Investment Company Act and Rule 19a-1 thereunder. The Trust is likewise obligated to file with the Commission the information contained in any such notice to shareholders and, in that regard, has attached hereto copies of each such notice made during the period.
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.
(Registrant) | CBRE Global Real Estate Income Fund | |
By (Signature and Title)* | /s/ Joseph P. Smith | |
Joseph P. Smith | ||
President and Chief 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 (Signature and Title)* | /s/ Joseph P. Smith | |
Joseph P. Smith | ||
President and Chief Executive Officer | ||
Date February 21, 2023 | ||
By (Signature and Title)* | /s/ Jonathan A. Blome | |
Jonathan A. Blome | ||
Chief Financial Officer | ||
Date February 21, 2023 |
* | Print the name and title of each signing officer under his or her signature. |