Item 1. | Reports to Stockholders. |
(a) | The Report to Shareholders of CBRE Global Real Estate Income Fund (the “Trust”) is attached herewith. |
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FINANCIAL STATEMENTS | ||||
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Semiannual Report 2023 CBRE Global Real Estate Income Fund | Confidential & Proprietary | 1 |
Semiannual Report 2023 CBRE Global Real Estate Income Fund | Confidential & Proprietary | 2 |
1H2023 | CY2022 | |||
REGION | ||||
North America2 | 4.6% | -25.6% | ||
Europe2 | -6.1% | -40.7% | ||
Asia-Pacific2 | -4.9% | -11.4% | ||
Global Real Estate Common Stocks3 | 1.0% | -25.1% | ||
U.S. REIT Preferred Stocks4 | 9.2% | -20.8% | ||
80/20 Blend of Global Common Stock & U.S. Preferred Stock5 | 2.7% | -24.1% |
Semiannual Report 2023 CBRE Global Real Estate Income Fund | Confidential & Proprietary | 3 |
GEOGRAPHIC EXPOSURE as of June 30, 2023 | SECTOR EXPOSURE as of June 30, 2023 | |
Source: CBRE Investment Management as of 06/30/2023. |
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Japan | Canada | U.K. | Australia | U.S. | Singapore | Cont. Europe | Hong Kong SAR, China | Global Average | ||||||||||||||||||||||||||||
∎ 2022 | 9.3% | 4.1% | 10.6% | 16.7% | 11.6% | 23.3% | 12.8% | -4.2% | 11.1% | |||||||||||||||||||||||||||
∎ 2023f | 6.2% | 4.1% | 4.0% | 3.7% | 3.4% | 1.5% | -3.6% | -4.0% | 2.9% | |||||||||||||||||||||||||||
∎ 2024f | 4.0% | 5.8% | 5.2% | 3.3% | 5.7% | 2.3% | -0.7% | 2.7% | 4.8% |
Semiannual Report 2023 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 |
1. | Global real estate stocks as measured by FTSE EPRA Nareit Developed Index – Net returned +1.0% during the first half of the year. The broader market as measured by the MSCI World Index (USD) returned +15.4% for the first half of the 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. |
6. | The Trust is currently paying distributions in excess of its net investment income and capital gains, which may result in a return of capital. Absent this, the distribution rate would have been lower. 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. |
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Beginning account value | Ending account value | Annualized expense ratio | Expenses paid during the period | |||||||||||||
January 1, 2023 | June 30, 2023 | Per $1,000(1) | ||||||||||||||
CBRE GLOBAL REAL ESTATE INCOME FUND | ||||||||||||||||
Actual | $ | 1,000.00 | $ | 989.60 | 3.68 | % | $ | 18.15 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,006.55 | 3.68 | % | $ | 18.31 |
(1) | Expenses are equal to the Fund’s annualized expense ratio, multiplied by the average account value over the period, multiplied by 181 (the number of days in the most recent six‑month period), then divided by 365. |
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– | 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 and non‑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. |
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– | 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 of on‑site or off‑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 of COVID‑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. |
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– | 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, 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 |
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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. |
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Shares | Market value | |||||||||||||||
Real Estate Securities* – 142.5% | ||||||||||||||||
Common Stock – 134.7% | ||||||||||||||||
Australia – 5.4% | ||||||||||||||||
830,420 | Charter Hall Group | $ | 5,920,161 | |||||||||||||
1,525,133 | Dexus | 7,918,603 | ||||||||||||||
914,821 | Goodman Group | 12,221,647 | ||||||||||||||
2,931,273 | Mirvac Group | 4,409,719 | ||||||||||||||
1,848,334 | Scentre Group | 3,260,412 | ||||||||||||||
8,780,872 | Vicinity Centres | 10,784,009 | ||||||||||||||
44,514,551 | ||||||||||||||||
Belgium – 2.2% | ||||||||||||||||
167,362 | Aedifica SA | 10,718,150 | ||||||||||||||
93,958 | Cofinimmo SA | 7,052,565 | ||||||||||||||
17,770,715 | ||||||||||||||||
Canada – 5.0% | ||||||||||||||||
176,498 | Canadian Apartment Properties REIT | 6,783,819 | ||||||||||||||
728,500 | Chartwell Retirement Residences | 5,213,599 | ||||||||||||||
939,900 | H&R Real Estate Investment Trust | 7,280,540 | ||||||||||||||
850,000 | RioCan Real Estate Investment Trust | 12,384,659 | ||||||||||||||
1,060,471 | Tricon Residential, Inc. | 9,342,750 | ||||||||||||||
41,005,367 | ||||||||||||||||
France – 3.8% | ||||||||||||||||
674,037 | Klepierre SA | 16,707,711 | ||||||||||||||
284,935 | Unibail-Rodamco-Westfield (a) | 14,968,110 | ||||||||||||||
31,675,821 | ||||||||||||||||
Germany – 0.7% | ||||||||||||||||
105,598 | LEG Immobilien SE (a) | 6,064,520 | ||||||||||||||
Hong Kong – 5.5% | ||||||||||||||||
4,706,470 | Link REIT | 26,125,034 | ||||||||||||||
3,630,000 | New World Development Co. Ltd. | 8,930,710 | ||||||||||||||
4,382,000 | Swire Properties Ltd. | 10,769,635 | ||||||||||||||
45,825,379 |
Shares | Market value | |||||||||||||||
Japan – 13.1% | ||||||||||||||||
3,139 | Activia Properties, Inc. | $ | 8,741,464 | |||||||||||||
7,321 | AEON REIT Investment Corp. | 7,871,335 | ||||||||||||||
24,096 | Japan Metropolitan Fund Investment Corp. | 16,054,553 | ||||||||||||||
3,440 | Kenedix Office Investment Corp. | 8,246,861 | ||||||||||||||
10,619 | LaSalle Logiport REIT | 11,101,331 | ||||||||||||||
1,424,600 | Mitsui Fudosan Co., Ltd. | 28,194,336 | ||||||||||||||
10,122 | Orix JREIT, Inc. | 12,423,584 | ||||||||||||||
2,685,592 | Tokyu Fudosan Holdings Corp. | 15,295,806 | ||||||||||||||
107,929,270 | ||||||||||||||||
Singapore – 4.9% | ||||||||||||||||
3,822,800 | CapitaLand Ascendas REIT | 7,683,168 | ||||||||||||||
11,760,444 | CapitaLand China Trust | 8,863,674 | ||||||||||||||
9,348,612 | CapitaLand Integrated Commercial Trust | 13,193,815 | ||||||||||||||
5,878,600 | Frasers Logistics & Commercial Trust | 5,429,674 | ||||||||||||||
8,338,000 | Keppel REIT | 5,544,907 | ||||||||||||||
40,715,238 | ||||||||||||||||
Spain – 1.2% | ||||||||||||||||
1,142,990 | Merlin Properties Socimi SA | 9,776,500 | ||||||||||||||
Sweden – 1.0% | ||||||||||||||||
891,381 | Castellum AB (a) | 8,495,984 | ||||||||||||||
Switzerland – 0.9% | ||||||||||||||||
68,681 | PSP Swiss Property AG | 7,669,180 | ||||||||||||||
United Kingdom – 4.1% | ||||||||||||||||
1,200,719 | British Land Co. PLC (The) | 4,622,319 | ||||||||||||||
1,901,474 | Land Securities Group PLC | 13,880,854 | ||||||||||||||
829,603 | Safestore Holdings PLC | 8,954,485 | ||||||||||||||
2,668,000 | Supermarket Income REIT PLC | 2,476,118 | ||||||||||||||
2,696,061 | Tritax Big Box REIT PLC | 4,284,522 | ||||||||||||||
34,218,298 |
Semiannual Report 2023 CBRE Global Real Estate Income Fund | Confidential & Proprietary | 16 |
Shares | Market value | |||||||||||||||
United States – 86.9% | ||||||||||||||||
178,107 | Alexandria Real Estate Equities, Inc. | $ | 20,213,363 | |||||||||||||
93,273 | American Tower Corp. | 18,089,366 | ||||||||||||||
372,093 | Apartment Income REIT Corp. | 13,428,836 | ||||||||||||||
138,979 | AvalonBay Communities, Inc. | 26,304,555 | ||||||||||||||
791,471 | Brixmor Property Group, Inc. | 17,412,362 | ||||||||||||||
652,710 | Broadstone NET Lease, Inc. | 10,077,842 | ||||||||||||||
74,659 | Camden Property Trust | 8,128,125 | ||||||||||||||
258,236 | Crown Castle, Inc. | 29,423,410 | ||||||||||||||
741,425 | CubeSmart | 33,112,041 | ||||||||||||||
82,914 | Equinix, Inc. | 64,999,601 | ||||||||||||||
76,610 | Essex Property Trust, Inc. | 17,949,723 | ||||||||||||||
666,620 | Healthcare Realty Trust, Inc., Class A | 12,572,453 | ||||||||||||||
844,349 | Healthpeak Properties, Inc. | 16,971,415 | ||||||||||||||
454,631 | Hudson Pacific Properties, Inc. | 1,918,543 | ||||||||||||||
74,291 | Hyatt Hotels Corp., Class A | 8,512,263 | ||||||||||||||
418,300 | Independence Realty Trust, Inc. | 7,621,426 | ||||||||||||||
1,039,635 | Invitation Homes, Inc. | 35,763,444 | ||||||||||||||
1,003,594 | Macerich Co. (The) | 11,310,504 | ||||||||||||||
316,068 | National Storage Affiliates Trust | 11,008,648 | ||||||||||||||
800,659 | Park Hotels & Resorts, Inc. | 10,264,448 | ||||||||||||||
515,041 | Pebblebrook Hotel Trust | 7,179,672 | ||||||||||||||
696,892 | Piedmont Office Realty Trust, Inc., Class A | 5,066,405 | ||||||||||||||
672,408 | Prologis, Inc. | 82,457,393 | ||||||||||||||
128,528 | Public Storage | 37,514,753 | ||||||||||||||
581,300 | Retail Opportunity Investments Corp. | 7,853,363 | ||||||||||||||
505,000 | Rexford Industrial Realty, Inc. | 26,371,100 | ||||||||||||||
77,754 | SBA Communications Corp., Class A | 18,020,267 | ||||||||||||||
424,495 | Simon Property Group, Inc. | 49,020,683 | ||||||||||||||
585,007 | Spirit Realty Capital, Inc. | 23,037,576 | ||||||||||||||
262,148 | Sun Communities, Inc. | 34,199,828 |
Shares | Market value | |||||||||||||||
1,408,200 | Sunstone Hotel Investors, Inc. | $ | 14,250,984 | |||||||||||||
468,091 | Welltower, Inc. | 37,863,881 | ||||||||||||||
717,918,273 | ||||||||||||||||
Total Common Stock | ||||||||||||||||
(cost $1,354,403,585) | 1,113,579,096 | |||||||||||||||
Preferred Stock – 7.8% | ||||||||||||||||
United States – 7.8% | ||||||||||||||||
245,403 | Digital Realty Trust, Inc., Series J, 5.250% | 5,219,722 | ||||||||||||||
301,100 | Digital Realty Trust, Inc., Series L, 5.200% | 6,491,716 | ||||||||||||||
282,200 | Federal Realty Investment Trust, Series C, 5.000% | 6,064,478 | ||||||||||||||
405,900 | National Storage Affiliates Trust, Series A, 6.000% | 9,469,647 | ||||||||||||||
383,644 | Pebblebrook Hotel Trust, Series E, 6.375% | 7,116,596 | ||||||||||||||
541,950 | Pebblebrook Hotel Trust, Series F, 6.300% | 10,557,186 | ||||||||||||||
262,125 | Pebblebrook Hotel Trust, Series G, 6.375% | 4,901,737 | ||||||||||||||
143,517 | Rexford Industrial Realty, Inc., Series B, 5.875% | 3,277,928 | ||||||||||||||
287,077 | Summit Hotel Properties, Inc., Series E, 6.250% | 5,956,848 | ||||||||||||||
265,000 | Sunstone Hotel Investors, Inc., Series H, 6.125% | 5,355,650 | ||||||||||||||
Total Preferred Stock | ||||||||||||||||
(cost $75,326,030) | 64,411,508 | |||||||||||||||
Total Investments – 142.5% | ||||||||||||||||
(cost $1,429,729,615) | 1,177,990,604 | |||||||||||||||
Liabilities in Excess of Other Assets – (42.5)% | (351,579,873 | ) | ||||||||||||||
Net Assets – 100.0% | $ | 826,410,731 |
* | 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. |
Semiannual Report 2023 CBRE Global Real Estate Income Fund | Confidential & Proprietary | 17 |
Assets | Level 1 | Level 2 | Level 3 | Total | ||||||||||||
INVESTMENT IN REAL ESTATE SECURITIES | ||||||||||||||||
Common Stock | ||||||||||||||||
Australia | $44,514,551 | $ - | $ - | $44,514,551 | ||||||||||||
Belgium | 17,770,715 | - | - | 17,770,715 | ||||||||||||
Canada | 41,005,367 | - | - | 41,005,367 | ||||||||||||
France | 31,675,821 | - | - | 31,675,821 | ||||||||||||
Germany | 6,064,520 | - | - | 6,064,520 | ||||||||||||
Hong Kong | 45,825,379 | - | - | 45,825,379 | ||||||||||||
Japan | 107,929,270 | - | - | 107,929,270 | ||||||||||||
Singapore | 40,715,238 | - | - | 40,715,238 | ||||||||||||
Spain | 9,776,500 | - | - | 9,776,500 | ||||||||||||
Sweden | 8,495,984 | - | - | 8,495,984 | ||||||||||||
Switzerland | 7,669,180 | - | - | 7,669,180 | ||||||||||||
United Kingdom | 34,218,298 | - | - | 34,218,298 | ||||||||||||
United States | 717,918,273 | - | - | 717,918,273 | ||||||||||||
Total Common Stock | 1,113,579,096 | - | - | 1,113,579,096 | ||||||||||||
Preferred Stock | ||||||||||||||||
United States | 64,411,508 | - | - | 64,411,508 | ||||||||||||
TOTAL INVESTMENT IN REAL ESTATE SECURITIES | $1,177,990,604 | $ - | $ - | $1,177,990,604 |
Semiannual Report 2023 CBRE Global Real Estate Income Fund | Confidential & Proprietary | 18 |
June 30, 2023 | ||||
Assets | ||||
Investments, at value (cost $1,429,729,615) | $ | 1,177,990,604 | ||
Cash and cash equivalents | 257,280 | |||
Dividends and interest receivable | 5,564,952 | |||
Dividend withholding reclaims receivable | 928,811 | |||
Other assets | 103,826 | |||
Total assets | 1,184,845,473 | |||
Liabilities | ||||
Line of credit payable | 353,676,800 | |||
Line of credit interest payable | 1,658,790 | |||
Payable for investment securities purchased | 1,460,736 | |||
Management fees payable | 815,963 | |||
Dividend and distributions payable | 260,629 | |||
Unrealized depreciation on spot contracts | 1,834 | |||
Accrued expenses | 559,990 | |||
Total liabilities | 358,434,742 | |||
NET ASSETS | $ | 826,410,731 | ||
Composition of Net Assets | ||||
$0.001 par value per share; | ||||
Unlimited number of shares authorized | ||||
139,968,594 shares issued and outstanding | $ | 139,969 | ||
Additional paid‑in capital | 1,055,325,553 | |||
Distributable earnings / (accumulated loss) | (229,054,791) | |||
NET ASSETS | $ | 826,410,731 | ||
NET ASSET VALUE | ||||
(BASED ON 139,968,594 SHARES OUTSTANDING) | $ | 5.90 |
Semiannual Report 2023 CBRE Global Real Estate Income Fund | Confidential & Proprietary | 19 |
For the six months ended June 30, 2023 | ||||
Investment Income | ||||
Dividends (net of foreign withholding taxes of $1,024,682) | $21,761,013 | |||
Interest | 4,255 | |||
Total investment income | 21,765,268 | |||
Expenses | ||||
Interest expense on line of credit | 9,010,949 | |||
Management fees | 4,741,248 | |||
Printing and mailing fees | 122,519 | |||
Administration fees | 116,518 | |||
Trustees’ fees and expenses | 110,570 | |||
Legal fees | 100,683 | |||
Custodian fees | 92,329 | |||
Insurance fees | 81,102 | |||
NYSE listing fee | 59,261 | |||
Audit and tax fees | 44,629 | |||
Transfer agent fees | 26,182 | |||
Miscellaneous expenses | 75,543 | |||
Total expenses | 14,581,533 | |||
NET INVESTMENT INCOME | 7,183,735 | |||
Net Realized and Unrealized Gain (Loss) on Investments, Written Options, and Foreign Currency Transactions | ||||
Net realized gain (loss) on: | ||||
Investments | 38,229,994 | |||
Written options | 518,033 | |||
Foreign currency transactions | (85,209) | |||
Total Net Realized Gain | 38,662,818 | |||
Net change in unrealized appreciation (depreciation) on: | ||||
Investments | (24,920,534) | |||
Foreign currency denominated assets and liabilities | (38,373) | |||
Total Net Change in Unrealized Depreciation | (24,958,907) | |||
NET REALIZED AND UNREALIZED GAIN ON INVESTMENTS, WRITTEN OPTIONS, AND FOREIGN CURRENCY TRANSACTIONS | 13,703,911 | |||
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS | $20,887,646 |
Semiannual Report 2023 CBRE Global Real Estate Income Fund | Confidential & Proprietary | 20 |
For the six months ended June 30, 2023 (unaudited) | For the year ended December 31, 2022 | |||||||
Change in Net Assets Resulting from Operations | ||||||||
Net investment income | $7,183,735 | $23,011,947 | ||||||
Net realized gain on investments, written options, and foreign currency transactions | 38,662,818 | 67,530,538 | ||||||
Net change in unrealized depreciation on investments, and foreign currency denominated assets and liabilities | (24,958,907) | (494,527,416) | ||||||
Net increase (decrease) in net assets resulting from operations | 20,887,646 | (403,984,931) | ||||||
Distributions on Common Shares | ||||||||
Distributions from distributable earnings | (46,180,636) | (81,613,345) | ||||||
Total distributions on common shares | (46,180,636) | (81,613,345) | ||||||
Capital Share transactions | ||||||||
Proceeds from shares sold | 117,591,843 | – | ||||||
Offering costs for common shares charged to paid-in capital | (1,898,934) | – | ||||||
Net increase from capital share transactions | 115,692,909 | – | ||||||
Net Increase (Decrease) in Net Assets | 90,399,919 | (485,598,276) | ||||||
Net Assets | ||||||||
Beginning of period | 736,010,812 | 1,221,609,088 | ||||||
End of period | $826,410,731 | $736,010,812 |
Semiannual Report 2023 CBRE Global Real Estate Income Fund | Confidential & Proprietary | 21 |
For the Six Months Ended June 30, 2023 | ||||
Cash Flows from Operating Activities | ||||
Net increase in net assets resulting from operations | $20,887,646 | |||
Adjustments to Reconcile Net Increase in Net Assets Resulting from Operations to Net Cash Used in Operating Activities | ||||
Net change in unrealized appreciation/depreciation on investments | 24,920,534 | |||
Net realized gain on investments | (38,229,994) | |||
Net realized gain on written options | (518,033) | |||
Cost of securities purchased | (349,971,327) | |||
Proceeds from sale of securities | 253,881,195 | |||
Premiums received on written options | 545,959 | |||
Payments to close written options | (27,926) | |||
Decrease in receivable for investment securities sold | 9,936,848 | |||
Increase in dividends and interest receivable | (979,280) | |||
Increase in dividend withholding reclaims receivable | (397,181) | |||
Decrease in unrealized appreciation on spot contracts | 1,557 | |||
Decrease in other assets | 15,836 | |||
Increase in payable for investment securities purchased | 1,460,736 | |||
Increase in management fees payable | 30,373 | |||
Increase in unrealized depreciation on spot contracts | 1,834 | |||
Increase in line of credit interest payable | 263,959 | |||
Increase in accrued expenses | 194,150 | |||
NET CASH USED IN OPERATING ACTIVITIES | (77,983,114) | |||
Cash Flows from Financing Activities: | ||||
Cash distributions paid on Common Shares | (46,120,169) | |||
Proceeds from shares sold | 117,591,843 | |||
Offering costs for common shares charged to paid-in capital | (1,898,934) | |||
Proceeds from borrowing on line of credit | 301,769,300 | |||
Payments on line of credit borrowings | (293,301,900) | |||
NET CASH PROVIDED BY FINANCING ACTIVITIES | 78,040,140 | |||
Net increase in cash | 57,026 | |||
Cash and Cash Equivalents at Beginning of Year | 200,254 | |||
CASH AND CASH EQUIVALENTS AT END OF YEAR | $257,280 | |||
Supplemental Disclosure | ||||
Interest paid on line of credit borrowings | $8,746,990 |
Semiannual Report 2023 CBRE Global Real Estate Income Fund | Confidential & Proprietary | 22 |
For the Six Months Ended June 30, 2023 (unaudited) | 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 period | ||||||||||||||||||||||||
Net asset value, beginning of period | $6.31 | $10.48 | $8.11 | $8.86 | $7.55 | $8.99 | ||||||||||||||||||
Income from investment operations | ||||||||||||||||||||||||
Net investment income(1) | 0.06 | 0.20 | 0.22 | 0.17 | 0.16 | 0.19 | ||||||||||||||||||
Net realized and unrealized gain (loss) on investments, written options and foreign currency transactions | 0.11 | (3.67) | 2.75 | (0.32) | 1.75 | (1.03) | ||||||||||||||||||
Total from investment operations | 0.17 | (3.47) | 2.97 | (0.15) | 1.91 | (0.84) | ||||||||||||||||||
Common Share transactions | ||||||||||||||||||||||||
Dilutive effect on net asset value as a result of rights offering(2) | (0.21) | – | – | – | – | – | ||||||||||||||||||
Offering costs charged to paid-in-capital | (0.01) | – | – | – | – | – | ||||||||||||||||||
Total from Common Share transactions | (0.22) | – | – | – | – | – | ||||||||||||||||||
Distributions on Common Shares | ||||||||||||||||||||||||
Net investment income | (0.36) | (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 | (0.36) | (0.70) | (0.60) | (0.60) | (0.60) | (0.60) | ||||||||||||||||||
NET ASSET VALUE, END OF PERIOD | $5.90 | $6.31 | $10.48 | $8.11 | $8.86 | $7.55 | ||||||||||||||||||
MARKET VALUE, END OF PERIOD | $5.23 | $5.73 | $9.79 | $6.88 | $8.02 | $6.16 | ||||||||||||||||||
Total investment return(3) | ||||||||||||||||||||||||
Net asset value | (1.04)% | (33.97)% | 37.88% | (0.74)% | 25.74% | (9.75)% | ||||||||||||||||||
Market value | (2.78)% | (35.54)% | 52.66% | (5.52)% | 40.87% | (15.52)% | ||||||||||||||||||
Ratios and supplemental data | ||||||||||||||||||||||||
Net assets, applicable to common shares, end of period (thousands) | $826,411 | $736,011 | $1,221,609 | $945,194 | $1,032,890 | $880,636 | ||||||||||||||||||
Borrowings (senior securities) outstanding, end of period (thousands) | $353,677 | $345,209 | $320,489 | $289,727 | $121,020 | $74,111 | ||||||||||||||||||
Asset Coverage per $1,000(4) | $3,337 | $3,132 | $4,812 | $4,262 | $9,535 | $12,883 | ||||||||||||||||||
Ratios to average net assets applicable to common shares of: | ||||||||||||||||||||||||
Net expenses | 3.68%(5) | 2.29% | 1.46% | 1.53% | 1.57% | 1.54% | ||||||||||||||||||
Net expenses, excluding interest on line of credit | 1.41%(5) | 1.39% | 1.24% | 1.26% | 1.16% | 1.17% | ||||||||||||||||||
Net investment income | 1.81%(5) | 2.49% | 2.37% | 2.25% | 1.89% | 2.30% | ||||||||||||||||||
Portfolio turnover rate | 22.18% | 53.88% | 78.44% | 72.50% | 44.97% | 70.38% | ||||||||||||||||||
(1) | Based on average shares outstanding. |
(2) | Shares issued at a 5% discount on a 5-day average market price from 3/31/2023 to 4/6/2023 |
(3) | 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. |
(4) | 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. |
(5) | Annualized. |
Semiannual Report 2023 CBRE Global Real Estate Income Fund | Confidential & Proprietary | 23 |
1 | FUND ORGANIZATION |
2 | SIGNIFICANT ACCOUNTING POLICIES |
Semiannual Report 2023 CBRE Global Real Estate Income Fund | Confidential & Proprietary | 25 |
(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. |
Semiannual Report 2023 CBRE Global Real Estate Income Fund | Confidential & Proprietary | 26 |
Semiannual Report 2023 CBRE Global Real Estate Income Fund | Confidential & Proprietary | 27 |
3 | DERIVATIVE INSTRUMENTS |
Realized gain | ||||
EQUITY RISK | ||||
Written options | $518,033 |
4 | CONCENTRATION OF RISK |
5 | INVESTMENT MANAGEMENT AGREEMENT AND OTHER AGREEMENTS |
6 | PORTFOLIO SECURITIES |
Semiannual Report 2023 CBRE Global Real Estate Income Fund | Confidential & Proprietary | 28 |
7 | FEDERAL INCOME TAXES |
Cost of investments for tax purposes | Gross tax unrealized appreciation | Gross tax unrealized depreciation | Net tax unrealized appreciation on investments | Net tax unrealized appreciation 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 |
Semiannual Report 2023 CBRE Global Real Estate Income Fund | Confidential & Proprietary | 29 |
8 | BORROWINGS |
9 | CAPITAL |
10 | INDEMNIFICATIONS |
11 | SUBSEQUENT EVENTS |
Semiannual Report 2023 CBRE Global Real Estate Income Fund | Confidential & Proprietary | 30 |
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) 555 East Lancaster Ave. Suite 120 Radnor, PA 19087 Age: 64 | 3 years/ since inception | Trustee | Senior Fellow Wharton Real Estate Center (since 2022); Managing Director of TRF3 Advisors (since 2022); Independent Investment Committee Member of CBRE Investment Management Listed Real Assets LLC (since 2022); Vice Chairman (2021) and Chief Executive Officer and Co‑Chief Investment Officer (1995—2020) of CBRE Investment Management Listed Real Assets LLC; 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 555 East Lancaster Ave. Suite 120 Radnor, PA 19087 Age: 67 | 3 years/ since inception | Trustee | Co‑Founder of Incompass Labs (since 2022); 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 555 East Lancaster Ave. Suite 120 Radnor, PA 19087 Age: 78 | 3 years/ 19 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 555 East Lancaster Ave. Suite 120 Radnor, PA 19087 Age: 64 | 3 years/ 41⁄2 years | Trustee | Founder and Managing Member of Perennial Capital Advisors, LLC (since 2003) | 1 | AIM Mutual, Inc. (2016), Kinefac Corporation (since 2009) |
Semiannual Report 2023 CBRE Global Real Estate Income Fund | Confidential & Proprietary | 32 |
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 | |||||
Heidi Stam 555 East Lancaster Ave. Suite 120 Radnor, PA 19087 Age 66 | 3 years/ 3 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. Ms. Greis, as Class III Trustee, is currently serving a term expiring at the Trust’s 2025 annual meeting of shareholders. Mr. Bartholdson has informed the Board that he intends to retire from the Board upon the conclusion of his term and, therefore, will not stand for re‑election at the 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. |
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 555 East Lancaster Ave, Suite 120 Radnor, PA 19087 Age: 55 President and Chief Executive Officer | Since 20221 | Chief Investment Officer (since 2021) and Co‑Chief Investment Officer (since 2011) of CBRE Investment Management Listed Real Assets LLC (formerly CBRE Clarion Securities LLC) | ||
Jonathan A. Blome 555 East Lancaster Ave, Suite 120 Radnor, PA 19087 Age: 46 Chief Financial Officer | since 2006 | Chief Operating Officer (since 2021) and Chief Financial Officer and Director of Operations (since 2011) of CBRE Investment Management Listed Real Assets LLC (formerly CBRE Clarion Securities LLC) | ||
Jeff Chang 555 East Lancaster Ave, Suite 120 Radnor, PA 19087 Age: 49 Chief Compliance Officer and Secretary | since 20232 | 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. |
Semiannual Report 2023 CBRE Global Real Estate Income Fund | Confidential & Proprietary | 33 |
Semiannual Report 2023 CBRE Global Real Estate Income Fund | Confidential & Proprietary | 34 |
Semiannual Report 2023 CBRE Global Real Estate Income Fund | Confidential & Proprietary | 35 |
Semiannual Report 2023 CBRE Global Real Estate Income Fund | Confidential & Proprietary | 36 |
(b) | Not applicable |
Item 2. | Code of Ethics. |
Not applicable for semi-annual reporting period.
Item 3. | Audit Committee Financial Expert. |
Not applicable for semi-annual reporting period.
Item 4. | Principal Accountant Fees and Services. |
Not applicable for semi-annual reporting period.
Item 5. | Audit Committee of Listed Registrants. |
Not applicable for semi-annual reporting period.
Item 6. | Investments. |
(a) | The Schedule of Investments is included as part of the report to shareholders filed under Item 1 of this form. |
(b) | Not applicable. |
Item 7. | Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies. |
Not applicable for semi-annual reporting period.
Item 8. | Portfolio Managers of Closed-End Management Investment Companies. |
There has been no change, as of the date of this filing, in any of the portfolio managers identified in response to paragraph (a)(1) of this Item in the registrant’s most recently filed annual report on Form N-CSR.
Item 9. | Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers. |
None.
Item 10. | Submission of Matters to a Vote of Security Holders. |
There have been no material changes to the procedures by which the shareholders may recommend nominees to the registrant’s board of directors, where those changes were implemented after the registrant last provided disclosure in response to the requirements of Item 407(c)(2)(iv) of Regulation S-K (17 CFR 229.407) (as required by Item 22(b)(15) of Schedule 14A (17 CFR 240.14a-101)), or this Item.
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 period covered by this report 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. |
1 | The Trust has received exemptive 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: August 28, 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: August 28, 2023 | ||||||
By (Signature and Title)*: | /s/ Jonathan A. Blome | |||||
Jonathan A. Blome | ||||||
Chief Financial Officer | ||||||
Date: August 28, 2023 |
* | Print the name and title of each signing officer under his or her signature. |