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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED
MANAGEMENT INVESTMENT COMPANIES
Investment Company Act file number 811-07870
Pioneer Real Estate Shares
(Exact name of registrant as specified in charter)
60 State Street, Boston, MA 02109
(Address of principal executive offices) (ZIP code)
Dorothy E. Bourassa, Pioneer Investment Management, Inc.,
60 State Street, Boston, MA 02109
(Name and address of agent for service)
Registrant's telephone number, including area code: (617) 742-7825
Date of fiscal year end: December 31
Date of reporting period: January 1, 2008 through June 30, 2008
Form N-CSR is to be used by management investment companies to file reports with
the Commission not later than 10 days after the transmission to stockholders of
any report that is required to be transmitted to stockholders under Rule 30e-1
under the Investment Company Act of 1940 (17 CFR 270.30e-1). The Commission may
use the information provided on Form N-CSR in its regulatory, disclosure review,
inspection, and policymaking roles.
A registrant is required to disclose the information specified by Form N-CSR,
and the Commission will make this information public. A registrant is not
required to respond to the collection of information contained in Form N-CSR
unless the Form displays a currently valid Office of Management and Budget
("OMB") control number. Please direct comments concerning the accuracy of the
information collection burden estimate and any suggestions for reducing the
burden to Secretary, Securities and Exchange Commission, 450 Fifth Street, NW,
Washington, DC 20549-0609. The OMB has reviewed this collection of information
under the clearance requirements of 44 U.S.C. ss. 3507.
ITEM 1. REPORTS TO SHAREOWNERS.
[IMAGE]
Pioneer Real Estate Shares
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Semiannual Report | June 30, 2008
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Ticker Symbols:
Class A PWREX
Class B PBREX
Class C PCREX
Class Y PYREX
[LOGO]PIONEER
Investments(R)
visit us: pioneerinvestments.com
Table of Contents
Letter to Shareowners 2
Portfolio Management Discussion 4
Portfolio Summary 7
Prices and Distributions 8
Performance Update 9
Comparing Ongoing Fund Expenses 13
Schedule of Investments 15
Financial Statements 21
Notes To Financial Statements 29
Approval of Investment Advisory Agreement 37
Trustees, Officers and Service Providers 41
Pioneer Real Estate Shares | Semiannual Report | 6/30/08 1
President's Letter
Dear Shareowner,
Staying diversified and keeping your portfolio invested in the markets are two
general investment principles that have served investors well over time. They
are particularly useful guides to keep in mind today, at a time when markets
around the globe are being buffeted by problems in the financial and real
estate industries and by concerns about a slowing economy.
After an extended period of steady economic growth with sustained low
unemployment and low inflation, the U.S. economy ran into difficulty as 2007
drew to a close. Investors in subprime mortgages were forced to mark down the
value of their assets, imperiling leveraged balance sheets. The ensuing credit
crunch forced central banks in the United States and Europe to assume the role
of "lender of last resort" to keep credit markets functioning. Conditions
worsened in the first quarter of 2008, as falling prices, margin calls and
deleveraging continued and while the auction-rate preferred market seized up.
By then, recession talk was widespread as concern grew that falling home
prices, rising unemployment, sharply rising food and energy prices, and
disruptions in financial markets posed a significant threat to economic growth.
In the next few months, though, there were no further banking crises, and
recession fears began to fade in light of positive economic news. However, a
seemingly unstoppable rise in the price of oil became a new source of recession
fears.
Markets reacted poorly to the developments leading up to the near failure of
Bear Stearns, with fixed-income credit spreads (the difference in rates between
corporate and U.S. government bonds) widening dramatically and stock markets
declining, wiping out the positive returns markets had delivered in the
preceding calendar year. Treasury bond prices rose as the market underwent a
classic "flight to quality." Those trends reversed in the months after the fall
of Bear Stearns, as stock markets rallied, recouping much of their
first-quarter losses, while Treasury bond prices declined. The stock market
then reversed direction yet again, falling sharply to end June 2008 near
earlier lows, while Treasury bond prices ended June near end-of-year levels.
In the six-month period ending June 30, 2008, the Dow Jones Industrial Average
fell 13%, the Standard & Poor's 500 Index fell 12% and the NASDAQ Composite
Index fell 14%. The MSCI EAFE Developed Market Index of international stock
markets fell 11%, and the MSCI Emerging Markets Index fell
2 Pioneer Real Estate Shares | Semiannual Report | 6/30/08
12%. In each case, the majority of the decline was concentrated in the month of
June. The U.S. investment-grade bond market, as measured by the Lehman Brothers
Aggregate Bond Index, rose 1% over the six-month period, while the U.S.
high-yield bond market, as measured by the Merrill Lynch High Yield Bond Master
II Index, fell 1%.
Looking forward, the risk of a 2008 recession seems diminished, but higher
commodity prices, lower real estate prices, and a weakened banking system still
pose substantial risks to the real economy. On the other hand, a weak U.S.
dollar and substantial fiscal and monetary stimulus are potent support for the
economy. Markets remain volatile, and falling risk tolerances and deleveraging
may depress asset prices in the short term, but equity and corporate bond
valuations look attractive over a longer time horizon unless the U.S. economy
falls into a severe and protracted recession.
Sudden swings in the markets are always to be expected, but they are difficult
to time. Maintaining a long-term time horizon, being diversified, and paying
attention to asset allocation are important investment principles. As always,
we encourage you to work closely with your financial advisor to find the mix of
stocks, bonds and money market assets that is best aligned to your particular
risk tolerance and investment objective and to adhere to a strategic plan
rather than letting emotions drive investment decisions.
Respectfully,
/s/ Daniel K. Kingsbury
Daniel K. Kingsbury
President and CEO
Pioneer Investment Management USA, Inc.
Any information in this shareholder report regarding market or economic trends
or the factors influencing the Fund's historical or future performance are
statements of the opinion of Fund management as of the date of this report.
These statements should not be relied upon for any other purposes. Past
performance is no guarantee of future results, and there is no guarantee that
market forecasts discussed will be realized.
Pioneer Real Estate Shares | Semiannual Report | 6/30/08 3
Portfolio Management Discussion | 6/30/08
The first half of 2008 was a difficult period for real estate stocks -- and
U.S. equities in general -- as the slumping economy, soaring oil costs, falling
home prices and difficulties in the credit markets weighed heavily on
investors' minds. Nevertheless, in spite of great volatility, real estate
investment trusts (REITs) outperformed the broader stock market, as Matthew
Troxell of AEW Capital Management, L.P., the Fund's subadviser, explains in the
following interview.
Q Why did real estate investments hold up better than other equity classes
during the semiannual period ended 6/30/08?
A Much of the sector's resiliency was due to increased demand for the sector's
defensive characteristics and from short positions being covered. REITs,
however, were not immune to the conditions affecting the broader stock
market during the six-month period. Difficulties in the credit markets
weighed heavily on REITs as higher financing costs resulted in a sharp
decline in commercial real estate transactions, which in turn put downward
pressure on valuations. Deteriorating credit conditions also raised
concerns over the outlook for underlying commercial property fundamentals,
which could deteriorate in step with the broader economy.
The U.S. REIT market, as measured by the Fund's benchmark -- the MSCI U.S.
REIT Index -- returned -3. 5% for the six months ended June 30, 2008, with
performance driven primarily by an 11% decline in June. For the same
period, the Dow Jones Wilshire Real Estate Securities Index, the Fund's
former benchmark, returned -3.41%. Comparatively, the broader stock market,
as measured by the S&P 500 Index, was down 11.9% for the six months ended
June 30, and dropped 8.4% in June.
Q How did the Fund perform in this environment?
A For the six months ended June 30, 2008, the Fund's Class A shares posted a
total return at net asset value of -3.11%, holding up better than the MSCI
U.S. REIT Index and the Fund's peer group. The average return for the 242
funds in the Fund's Lipper category of real estate funds was -3.94%. Both
stock selection and sector allocation had a modestly positive impact on the
Fund's relative performance during the period. Stock selection in the
industrial, hotel and healthcare sectors contributed to performance.
Positive results in those sectors were partially offset by negative results
in the apartment, triple net lease and shopping center sectors. Positive
sector allocation results were primarily attributable to the Fund's
overweighting in the better performing storage sector and underweighting to
the lagging triple net lease sector.
4 Pioneer Real Estate Shares | Semiannual Report | 6/30/08
Q Could you highlight some of the holdings that contributed positively to
performance?
A Certainly. Public Storage benefited from a strong first quarter 2008 earnings
report that exceeded expectations. Liberty Property Trust, a defensive
play, owns industrial and office properties primarily in the Eastern United
States. This REIT was among the weakest performers in the industrial sector
last year, and so some strengthening in its pricing during the first half
of 2008 was not surprising. The performance of Simon Property Group, the
largest REIT in North America, primarily reflected the defensive
characteristics of the company's solid balance sheet.
Q Which holdings proved most disappointing?
A Shares of iStar Financial lost significant ground primarily as a result of
the negative impact of the company's July 2007 acquisition of a portfolio
of commercial loans with some distressed assets. The performance of Host
Hotels & Resorts, a slight overweight, was reflective of the hotel sector
as a whole, which retreated during the period due to the slowing economy
and the impact of rising fuel costs on travel. Federal Realty Investment
Trust suffered from the economy's weaker growth and its negative impact on
many retailers. (The shopping center sector was down almost 6% for the
period). We continue to believe the companies represent solid values
relative to their peers and have maintained the portfolio's overweight
positions in all three stocks.
Q How are the property sectors holding up given evidence of slower growth?
A In our view, underlying fundamentals have begun to react to the ongoing
economic slowdown, particularly in those markets most affected by the
housing market downturn. In the retail sector, property vacancies have
crept up for several consecutive quarters as American consumers have become
increasingly reluctant to spend. We do believe, however, that the sector
should be fairly well positioned when demand recovers, since supply growth
has been moderate. Office property vacancies have begun to climb in central
business districts and to an even greater degree in suburban locations.
Lack of demand is the primary concern, as supply remains in check and is
likely to weaken further in the wake of the credit crunch. Within the
industrial sector, fundamentals have probably topped out for this cycle as
space availability has increased over the first half of 2008.
Conditions in the apartment sector have been impacted, both negatively and
positively, by troubles in the single-family housing sector. Rising
foreclosures and stricter underwriting standards are forcing some home
buyers and would-be buyers to become renters, while rentals of
investor-owned
Pioneer Real Estate Shares | Semiannual Report | 6/30/08 5
homes and condominiums are providing housing alternatives to
would-be-renters. The conditions are likely to persist until a clear bottom
is reached in single-family fundamentals.
In the hotel sector, occupancies are a couple of percentage points lower
than they were a year earlier, though room rates were still more than 3%
above comparable levels a year earlier. Consequently, revenues per
available room remained flat. We expect hotel occupancies to remain under
pressure as both leisure and business travelers become more cautious in a
slowing economy.
Q What is your outlook?
A We believe that the housing sector, credit markets and oil prices will shape
the degree to which the economy strengthens or weakens during the remainder
of the year. The lack of a clear direction could make for additional bouts
of volatility during the remainder of the year. Our investment process
continues to focus on securities selection within each property sector,
with the goal of identifying real estate stocks that we believe represent
the greatest value in terms of upside potential. We expect to make
incremental changes to our portfolios as values and catalysts continue to
change.
The Fund invests in REIT securities, the value of which can fall for a variety
of reasons, such as declines in rental income, fluctuating interest rates, poor
property management, environmental liabilities, uninsured damage, increased
competition, or changes in real estate tax laws. At times, the Fund's
investments may represent industries or industry sectors that are interrelated
or have common risks, making it more susceptible to any economic, political, or
regulatory developments or other risks affecting those industries or sectors.
Past performance is no guarantee of future results, and there is no guarantee
that market forecasts discussed will be realized.
Any information in this shareholder report regarding market or economic trends
or the factors influencing the Fund's historical or future performance are
statements of the opinion of Fund management as of the date of this report.
These statements should not be relied upon for any other purposes.
6 Pioneer Real Estate Shares | Semiannual Report | 6/30/08
Portfolio Summary | 6/30/08
Portfolio Diversification
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(As a percentage of total investment portfolio)
[THE FOLLOWING DATA WAS REPRESENTED AS A PIE CHART IN THE PRINTED MATERIAL]
U.S. Common Stocks 83.3%
Temporary Cash Investments 16.7%
Sector Diversification
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(As a percentage of equity holdings)
[THE FOLLOWING DATA WAS REPRESENTED AS A PIE CHART IN THE PRINTED MATERIAL]
Regional Mall 19.8%
Apartment 15.0%
Office 13.9%
Diversified 13.2%
Storage 10.4%
Industrial 9.7%
Shopping Center 9.3%
Healthcare 6.7%
Hotel 2.0%
10 Largest Holdings*
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(As a percentage of equity holdings)
1. Simon Property Group 9.27%
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2. Boston Properties, Inc. 5.97
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3. Equity Residential Property Trust 5.92
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4. Public Storage, Inc. 5.35
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5. Vornado Realty Trust 5.05
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6. AvalonBay Communities, Inc. 3.48
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7. Regency Centers Corp. 3.41
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8. Liberty Property Trust 3.37
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9. The Macerich Co. 3.35
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10. Developers Diversified Realty Corp. 3.32
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* This list excludes temporary cash and derivative instruments. Portfolio
holdings will vary for other periods. The holdings listed should not be
considered recommendations to buy or sell any securities listed.
Pioneer Real Estate Shares | Semiannual Report | 6/30/08 7
Prices and Distributions | 6/30/08
Net Asset Value Per Share
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Class 6/30/08 12/31/07
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A $20.92 $ 21.94
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B $20.68 $ 21.68
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C $20.71 $ 21.72
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Y $20.89 $ 21.90
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Distributions Per Share: 1/1/08-6/30/08
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Short-Term Long-Term
Class Dividends Capital Gains Capital Gains
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A $0.3600 $ -- $ --
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B $0.2400 $ -- $ --
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C $0.2600 $ -- $ --
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Y $0.4200 $ -- $ --
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8 Pioneer Real Estate Shares | Semiannual Report | 6/30/08
Performance Update | 6/30/08 Class A Shares
Investment Returns
- --------------------------------------------------------------------------------
The mountain chart on the right shows the change in value of a $10,000
investment made in Pioneer Real Estate Shares at public offering price,
compared to that of the Morgan Stanley Capital International (MSCI) US REIT
Index and the Dow Jones Wilshire Real Estate Securities Index.
Average Annual Total Returns
(As of June 30, 2008)
- ---------------------------------------------------------------------
Net Asset Public Offering
Period Value (NAV) Price (POP)
- ---------------------------------------------------------------------
10 Years 9.94% 9.30%
5 Years 14.51 13.16
1 Year -15.43 -20.28
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Expense Ratio
(Per prospectus dated May 1, 2008)
- ---------------------------------------------------------------------
Gross Net
- ---------------------------------------------------------------------
1.36% 1.36%
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[THE FOLLOWING DATA WAS REPRESENTED AS A MOUNTAIN CHART IN THE PRINTED MATERIAL]
Value of $10,000 Investment
Pioneer Real Dow Jones Wilshire MSCI US
Estate Shares Real Estate Securities Index REIT Index
6/98 $ 9,425 $10,000 $10,000
$ 8,475 $ 9,312 $ 9,159
6/00 $ 8,824 $ 9,726 $ 9,468
$10,563 $12,112 $11,697
6/02 $12,048 $13,786 $13,575
$12,354 $14,198 $14,110
6/04 $15,826 $18,359 $17,825
$21,286 $24,661 $23,695
6/06 $26,249 $30,055 $28,350
$28,759 $33,579 $31,767
6/08 $24,322 $28,402 $27,274
Call 1-800-225-6292 or visit www.pioneerinvestments.com for the most recent
month-end performance results. Current performance may be lower or higher than
the performance data quoted.
The performance data quoted represents past performance, which is no guarantee
of future results. Investment return and principal value will fluctuate, and
shares, when redeemed, may be worth more or less than their original cost.
NAV results represent the percent change in net asset value per share. Returns
would have been lower had sales charges been reflected. POP returns reflect
deduction of maximum 5.75% sales charge. All results are historical and assume
the reinvestment of dividends and capital gains. Other share classes are
available for which performance and expenses will differ.
Performance results reflect any applicable expense waivers in effect during the
periods shown. Without such waivers Fund performance would be lower. Waivers
may not be in effect for all funds. Certain fee waivers are contractual through
a specified period. Otherwise, fee waivers can be rescinded at any time. See
the prospectus and financial statements for more information.
The performance table and graph do not reflect the deduction of fees and taxes
that a shareowner would pay on Fund distributions or the redemption of Fund
shares.
The MSCI US REIT Index is a widely-used index comprising a broad representation
of the most actively traded real estate trusts and is designed to be a measure
of real estate equity performance. The Dow Jones Wilshire Real Estate
Securities Index measures the performance of publicly traded real estate
securities, such as real estate investment trusts and real estate operating
companies. Index returns assume reinvestment of dividends and, unlike Fund
returns, do not reflect any fees, expenses or sales charges. You cannot invest
directly in the Index. Effective April 1, 2008, the Fund's benchmark changed to
the MSCI REIT Index. The securities represented in the new index better reflect
the types of securities in which the Fund is likely to invest.
Pioneer Real Estate Shares | Semiannual Report | 6/30/08 9
Performance Update | 6/30/08 Class B Shares
Investment Returns
- --------------------------------------------------------------------------------
The mountain chart on the right shows the change in value of a $10,000
investment made in Pioneer Real Estate Shares, compared to that of the Morgan
Stanley Capital International (MSCI) US REIT Index and the Dow Jones Wilshire
Real Estate Securities Index.
Average Annual Total Returns
(As of June 30, 2008)
- -------------------------------------------------------------
If If
Period Held Redeemed
- -------------------------------------------------------------
10 Years 9.03% 9.03%
5 Years 13.49 13.49
1 Year -16.27 -19.03
- -------------------------------------------------------------
Expense Ratio
(Per prospectus dated May 1, 2008)
- -------------------------------------------------------------
Gross Net
- -------------------------------------------------------------
2.28% 2.28%
- -------------------------------------------------------------
[THE FOLLOWING DATA WAS REPRESENTED AS A MOUNTAIN CHART IN THE PRINTED MATERIAL]
Value of $10,000 Investment
Pioneer Real Dow Jones Wilshire MSCI US
Estate Shares Real Estate Securities Index REIT Index
6/98 $10,000 $10,000 $10,000
$ 8,918 $ 9,312 $ 9,159
6/00 $ 9,224 $ 9,726 $ 9,468
$10,954 $12,112 $11,697
6/02 $12,393 $13,786 $13,575
$12,609 $14,198 $14,110
6/04 $16,023 $18,359 $17,825
$21,369 $24,661 $23,695
6/06 $26,107 $30,055 $28,350
$28,352 $33,579 $31,767
6/08 $23,740 $28,402 $27,274
Call 1-800-225-6292 or visit www.pioneerinvestments.com for the most recent
month-end performance results. Current performance may be lower or higher than
the performance data quoted.
The performance data quoted represents past performance, which is no guarantee
of future results. Investment return and principal value will fluctuate, and
shares, when redeemed, may be worth more or less than their original cost.
"If Held" results represent the percent change in net asset value per share.
Returns would have been lower had sales charges been reflected. "If redeemed"
returns reflect the deduction of applicable contingent deferred sales charge
(CDSC). Effective December 1, 2004, the period during which a CDSC is applied
to withdrawals was shortened to 5 years. The maximum CDSC for Class B shares
continues to be 4%. For more complete information, please see the prospectus
for details. Note: Shares purchased prior to December 1, 2004 remain subject to
the CDSC in effect at the time you purchased those shares. For performance
information for shares purchased prior to December 1, 2004, please visit
www.pioneerinvestments.com.
All results are historical and assume the reinvestment of dividends and capital
gains. Other share classes are available for which performance and expenses
will differ.
Performance results reflect any applicable expense waivers in effect during the
periods shown. Without such waivers Fund performance would be lower. Waivers
may not be in effect for all funds. Certain fee waivers are contractual through
a specified period. Otherwise, fee waivers can be rescinded at any time. See
the prospectus and financial statements for more information.
The performance table and graph do not reflect the deduction of fees and taxes
that a shareowner would pay on Fund distributions or the redemption of Fund
shares.
The MSCI US REIT Index is a widely-used index comprising a broad representation
of the most actively traded real estate trusts and is designed to be a measure
of real estate equity performance. The Dow Jones Wilshire Real Estate
Securities Index measures the performance of publicly traded real estate
securities, such as real estate investment trusts and real estate operating
companies. Index returns assume reinvestment of dividends and, unlike Fund
returns, do not reflect any fees, expenses or sales charges. You cannot invest
directly in an Index. Effective April 1, 2008, the Fund's benchmark changed to
the MSCI REIT Index. The securities represented in the new index better reflect
the types of securities in which the Fund is likely to invest.
10 Pioneer Real Estate Shares | Semiannual Report | 6/30/08
Performance Update | 6/30/08 Class C Shares
Investment Returns
- --------------------------------------------------------------------------------
The mountain chart on the right shows the change in value of a $10,000
investment made in Pioneer Real Estate Shares, compared to that of the Morgan
Stanley Capital International (MSCI) US REIT Index and the Dow Jones Wilshire
Real Estate Securities Index.
Average Annual Total Returns
(As of June 30, 2008)
- --------------------------------------------------------------
If If
Period Held Redeemed
- --------------------------------------------------------------
10 Years 9.09% 9.09%
5 Years 13.58 13.58
1 Year -16.16 -16.16
- --------------------------------------------------------------
Expense Ratio
(Per prospectus dated May 1, 2008)
- --------------------------------------------------------------
Gross Net
- --------------------------------------------------------------
2.17% 2.17%
- --------------------------------------------------------------
[THE FOLLOWING DATA WAS REPRESENTED AS A MOUNTAIN CHART IN THE PRINTED MATERIAL]
Value of $10,000 Investment
Pioneer Real Dow Jones Wilshire MSCI US
Estate Shares Real Estate Securities Index REIT Index
6/98 $10,000 $10,000 $10,000
$ 8,909 $ 9,312 $ 9,159
6/00 $ 9,232 $ 9,726 $ 9,468
$10,956 $12,112 $11,697
6/02 $12,402 $13,786 $13,575
$12,628 $14,198 $14,110
6/04 $16,053 $18,359 $17,825
$21,429 $24,661 $23,695
6/06 $26,205 $30,055 $28,350
$28,467 $33,579 $31,767
6/08 $23,867 $28,402 $27,274
Call 1-800-225-6292 or visit www.pioneerinvestments.com for the most recent
month-end performance results. Current performance may be lower or higher than
the performance data quoted.
The performance data quoted represents past performance, which is no guarantee
of future results. Investment return and principal value will fluctuate, and
shares, when redeemed, may be worth more or less than their original cost.
Class C shares held for less than one year are also subject to a 1% contingent
deferred sales charge (CDSC). The performance of Class C shares does not
reflect the 1% front-end sales charge in effect prior to February 1, 2004. If
you paid a 1% sales charge, your returns would be lower than those shown above.
"If Held" results represent the percent change in net asset value per share.
Returns would have been lower had sales charges been reflected. All results are
historical and assume the reinvestment of dividends and capital gains. Other
share classes are available for which performance and expenses will differ.
Performance results reflect any applicable expense waivers in effect during the
periods shown. Without such waivers Fund performance would be lower. Waivers
may not be in effect for all funds. Certain fee waivers are contractual through
a specified period. Otherwise, fee waivers can be rescinded at any time. See
the prospectus and financial statements for more information.
The performance table and graph do not reflect the deduction of fees and taxes
that a shareowner would pay on Fund distributions or the redemption of Fund
shares.
The MSCI US REIT Index is a widely-used index comprising a broad representation
of the most actively traded real estate trusts and is designed to be a measure
of real estate equity performance. The Dow Jones Wilshire Real Estate
Securities Index measures the performance of publicly traded real estate
securities, such as real estate investment trusts and real estate operating
companies. Index returns assume reinvestment of dividends and, unlike Fund
returns, do not reflect any fees, expenses or sales charges. You cannot invest
directly in an Index. Effective April 1, 2008, the Fund's benchmark changed to
the MSCI REIT Index. The securities represented in the new index better reflect
the types of securities in which the Fund is likely to invest.
Pioneer Real Estate Shares | Semiannual Report | 6/30/08 11
Performance Update | 6/30/08 Class Y Shares
Investment Returns
- --------------------------------------------------------------------------------
The mountain chart on the right shows the change in value of a $10,000
investment made in , compared to that of the Morgan Stanley Capital
International (MSCI) US REIT Index and the Dow Jones Wilshire Real Estate
Securities Index.
Average Annual Total Returns
(As of June 30, 2008)
- --------------------------------------------------------------
If If
Period Held Redeemed
- --------------------------------------------------------------
10 Years 10.59% 10.59%
5 Years 15.10 15.10
1 Year -14.98 -14.98
- --------------------------------------------------------------
Expense Ratio
(Per prospectus dated May 1, 2008)
- --------------------------------------------------------------
Gross Net
- --------------------------------------------------------------
0.90% 0.90%
- --------------------------------------------------------------
[THE FOLLOWING DATA WAS REPRESENTED AS A MOUNTAIN CHART IN THE PRINTED MATERIAL]
Value of $10,000 Investment
Pioneer Real Dow Jones Wilshire MSCI US
Estate Shares Real Estate Securities Index REIT Index
6/98 $10,000 $10,000 $10,000
$ 9,077 $ 9,312 $ 9,159
6/00 $ 9,520 $ 9,726 $ 9,468
$11,452 $12,112 $11,697
6/02 $13,125 $13,786 $13,575
$13,545 $14,198 $14,110
6/04 $17,451 $18,359 $17,825
$23,589 $24,661 $23,695
6/06 $29,236 $30,055 $28,350
$32,187 $33,579 $31,767
6/08 $27,366 $28,402 $27,274
Call 1-800-225-6292 or visit www.pioneerinvestments.com for the most recent
month-end performance results. Current performance may be lower or higher than
the performance data quoted.
The performance data quoted represents past performance, which is no guarantee
of future results. Investment return and principal value will fluctuate, and
shares, when redeemed, may be worth more or less than their original cost.
Class Y shares are not subject to sales charges and are available for limited
groups of eligible investors, including institutional investors. All results
are historical and assume the reinvestment of dividends, and capital gains.
Other share classes are available for which performance and expenses will
differ.
Performance results reflect any applicable expense waivers in effect during the
periods shown. Without such waivers Fund performance would be lower. Waivers
may not be in effect for all funds. Certain fee waivers are contractual through
a specified period. Otherwise, fee waivers can be rescinded at any time. See
the prospectus and financial statements for more information.
The performance table and graph do not reflect the deduction of fees and taxes
that a shareowner would pay on Fund distributions or the redemption of Fund
shares.
The MSCI US REIT Index is a widely-used index comprising a broad representation
of the most actively traded real estate trusts and is designed to be a measure
of real estate equity performance. The Dow Jones Wilshire Real Estate
Securities Index measures the performance of publicly traded real estate
securities, such as real estate investment trusts and real estate operating
companies. Index returns assume reinvestment of dividends and, unlike Fund
returns, do not reflect any fees, expenses or sales charges. You cannot invest
directly in an Index. Effective April 1, 2008, the Fund's benchmark changed to
the MSCI REIT Index. The securities represented in the new index better reflect
the types of securities in which the Fund is likely to invest.
12 Pioneer Real Estate Shares | Semiannual Report | 6/30/08
Comparing Ongoing Fund Expenses
As a shareowner in the Fund, you incur two types of costs:
(1) ongoing costs, including management fees, distribution and/or service
(12b-1) fees, and other Fund expenses; and
(2) transaction costs, including sales charges (loads) on purchase payments.
This example is intended to help you understand your ongoing expenses (in
dollars) of investing in the Fund and to compare these costs with the ongoing
costs of investing in other mutual funds. The example is based on an investment
of $1,000 at the beginning of the Fund's latest six-month period and held
throughout the six months.
Using the Tables
- --------------------------------------------------------------------------------
Actual Expenses
The first table below provides information about actual account values and
actual expenses. You may use the information in this table, together with the
amount you invested, to estimate the expenses that you paid over the period as
follows:
(1) Divide your account value by $1,000
Example: an $8,600 account value [divided by] $1,000 = 8.6
(2) Multiply the result in (1) above by the corresponding share class's number
in the third row under the heading entitled "Expenses Paid During Period"
to estimate the expenses you paid on your account during this period.
Expenses Paid on a $1,000 Investment in Pioneer Real Estate Shares
Based on actual returns from January 1, 2008 through June 30, 2008.
- --------------------------------------------------------------------------------------
Share Class A B C Y
- --------------------------------------------------------------------------------------
Beginning Account $ 1,000.00 $ 1,000.00 $ 1,000.00 $ 1,000.00
Value On 1/1/08
- --------------------------------------------------------------------------------------
Ending Account $ 968.90 $ 964.20 $ 964.70 $ 971.90
Value On 6/30/08
- --------------------------------------------------------------------------------------
Expenses Paid $ 7.44 $ 12.36 $ 11.63 $ 4.76
During Period*
- --------------------------------------------------------------------------------------
* Expenses are equal to the Fund's annualized expense ratio of 1.52%, 2.53%,
2.38% and 0.97% for Class A, Class B, Class C and Class Y shares,
respectively, multiplied by the average account value over the period,
multiplied by 182/366 (to reflect the one-half year period).
Pioneer Real Estate Shares | Semiannual Report | 6/30/08 13
Comparing Ongoing Fund Expenses (continued)
Hypothetical Example for Comparison Purposes
The table below provides information about hypothetical account values and
hypothetical expenses based on the Fund's actual expense ratio and an assumed
rate of return of 5% per year before expenses, which is not the Fund's actual
return. The hypothetical account values and expenses may not be used to
estimate the actual ending account balance or expenses you paid for the period.
You may use this information to compare the ongoing costs of investing in the
Fund and other funds. To do so, compare this 5% hypothetical example with the
5% hypothetical examples that appear in the shareholder reports of the other
funds.
Please note that the expenses shown in the tables are meant to highlight your
ongoing costs only and do not reflect any transaction costs, such as sales
charges (loads) that are charged at the time of the transaction. Therefore, the
table below is useful in comparing ongoing costs only and will not help you
determine the relative total costs of owning different funds. In addition, if
these transaction costs were included, your costs would have been higher.
Expenses Paid on a $1,000 Investment in Pioneer Real Estate Shares
Based on a hypothetical 5% return per year before expenses, reflecting the
period from January 1, 2008 through June 30, 2008.
- --------------------------------------------------------------------------------------
Share Class A B C Y
- --------------------------------------------------------------------------------------
Beginning Account $ 1,000.00 $ 1,000.00 $ 1,000.00 $ 1,000.00
Value On 1/1/08
- --------------------------------------------------------------------------------------
Ending Account $ 1,017.30 $ 1,012.28 $ 1,013.03 $ 1,020.04
Value On 6/30/08
- --------------------------------------------------------------------------------------
Expenses Paid $ 7.62 $ 12.66 $ 11.91 $ 4.87
During Period*
- --------------------------------------------------------------------------------------
* Expenses are equal to the Fund's annualized expense ratio of 1.52%, 2.53%,
2.38% and 0.97% for Class A, Class B, Class C and Class Y shares,
respectively, multiplied by the average account value over the period,
multiplied by 182/366 (to reflect the one-half year period).
14 Pioneer Real Estate Shares | Semiannual Report | 6/30/08
Schedule of Investments | 6/30/08 (unaudited)
- --------------------------------------------------------------------------------
Shares Value
- --------------------------------------------------------------------------------
COMMON STOCKS -- 98.0%
CONSUMER SERVICES -- 1.9%
Hotels, Resorts & Cruise Lines -- 1.9%
74,500 Starwood Hotels & Resorts Worldwide, Inc. $ 2,985,215
------------
Total Consumer Services $ 2,985,215
- --------------------------------------------------------------------------------
REAL ESTATE -- 96.0%
Diversified Real Estate Investment Trusts -- 9.2%
155,000 Liberty Property Trust $ 5,138,250
30,000 PS Business Parks, Inc.* 1,548,000
87,500 Vornado Realty Trust (b) 7,700,000
------------
$ 14,386,250
- --------------------------------------------------------------------------------
Industrial Real Estate Investment Trusts -- 9.5%
79,500 AMB Property Corp. (b) $ 4,005,210
365,000 DCT Industrial Trust, Inc. 3,022,200
83,300 Dupont Fabros Technology, Inc. (b) 1,552,712
79,700 First Potomac Realty Trust 1,214,628
92,500 ProLogis Trust 5,027,375
------------
$ 14,822,125
- --------------------------------------------------------------------------------
Mortgage Real Estate Investment Trusts -- 0.6%
74,900 iStar Financial, Inc. (b) $ 989,429
- --------------------------------------------------------------------------------
Office Real Estate Investment Trusts -- 13.7%
85,000 BioMed Property Trust, Inc. $ 2,085,050
100,800 Boston Properties, Inc. (b) 9,094,176
117,500 Brandywine Realty Trust (b) 1,851,800
73,000 Corporate Office Properties Trust 2,506,090
37,500 Digital Realty Trust, Inc. (b) 1,534,125
198,100 HRPT Properties Trust (b) 1,341,137
60,000 Kilroy Realty Corp. 2,821,800
------------
$ 21,234,178
- --------------------------------------------------------------------------------
Real Estate Management & Development -- 3.1%
270,000 Brookfield Properties Corp. $ 4,803,300
- --------------------------------------------------------------------------------
Residential Real Estate Investment Trust -- 14.6%
91,575 Apartment Investment & Management Co. $ 3,119,045
59,500 AvalonBay Communities, Inc.* 5,305,020
90,600 Camden Property Trust* 4,009,956
235,900 Equity Residential Property Trust (b) 9,027,893
58,500 United Dominion Realty Trust, Inc. (b) 1,309,230
------------
$ 22,771,144
- --------------------------------------------------------------------------------
Retail Real Estate Investment Trusts -- 28.5%
145,800 Developers Diversified Realty Corp. (b) $ 5,060,718
66,600 Federal Realty Investment Trust 4,595,400
92,500 General Growth Properties, Inc. (b) 3,240,275
83,200 Kimco Realty Corp. (b) 2,872,064
The accompanying notes are an integral part of these financial statements.
Pioneer Real Estate Shares | Semiannual Report | 6/30/08 15
Schedule of Investments | 6/30/08 (unaudited) (continued)
- -----------------------------------------------------------------------------------------
Shares Value
- -----------------------------------------------------------------------------------------
Retail Real Estate Investment Trusts -- (continued)
110,200 Kite Realty Group Trust $ 1,377,500
88,000 Regency Centers Corp. 5,202,560
157,100 Simon Property Group, Inc. 14,121,719
56,600 Taubman Centers, Inc. 2,753,590
82,200 The Macerich Co. (b) 5,107,086
------------
$ 44,330,912
- -----------------------------------------------------------------------------------------
Specialized Real Estate Investment Trusts -- 16.8%
177,900 Ashford Hospitality Trust $ 821,898
123,000 Extra Space Storage, Inc. (b) 1,889,280
73,000 HCP, Inc. (b) 2,322,130
15,100 Hospitality Properties Trust 369,346
339,100 Host Hotels & Resorts, Inc. 4,628,715
160,000 Nationwide Health Properties, Inc. (b) 5,038,400
171,200 Omega Healthcare Investors, Inc. 2,850,480
101,000 Public Storage, Inc. 8,159,790
------------
$ 26,080,039
------------
Total Real Estate $149,417,377
- -----------------------------------------------------------------------------------------
TOTAL COMMON STOCKS
(Cost $109,547,041) $152,402,592
- -----------------------------------------------------------------------------------------
TEMPORARY CASH INVESTMENTS -- 19.6%
Repurchase Agreements -- 1.5%
465,000 Bank of America, 2.2%, dated 6/30/08, repurchase price of
$465,000 plus accrued interest on 7/1/08 collateralized by
the following:
$1,256,027 Federal National Mortgage Association,
5.5%, 6/1/33 $ 465,000
465,000 Barclays Plc, 2.27%, dated 6/30/08, repurchase price of
$465,000 plus accrued interest on 7/2/08 collateralized by
the following:
$282,692 Federal Home Loan Mortgage Corp.,
4.171 - 6.27%, 12/1/34 - 10/1/37
$290,482 Federal National Mortgage Association,
4.024 - 6.082%, 8/1/36 - 2/1/48 465,000
470,000 Deutsche Bank, 2.3%, dated 6/30/08, repurchase price of
$470,000 plus accrued interest on 7/1/08 collateralized by
the following:
$115,811 Federal National Mortgage Association (ARM),
4.708 - 5.887%, 12/1/13 - 3/1/37
$87,817 Federal Home Loan Mortgage Corp.,
4.703 - 4.704%, 12/1/35 - 3/1/35
$360,998 Freddie Mac Giant,
4.5 - 7.0%, 10/1/34 - 5/1/38
$193,862 U.S. Treasury Strip, 0.0%, 8/15/22 470,000
The accompanying notes are an integral part of these financial statements.
16 Pioneer Real Estate Shares | Semiannual Report | 6/30/08
Shares Value
Repurchase Agreements -- (continued)
465,000 JP Morgan, 2.26%, dated 6/30/08, repurchase price of
$465,000 plus accrued interest on 7/1/08 collateralized
by $517,064 Federal National Mortgage Association,
4.5 - 6.5%, 3/1/23 - 5/1/38 $ 465,000
465,000 Merrill Lynch, 2.5%, dated 6/30/08, repurchase price of
$460,000 plus accrued interest on 7/1/08 collateralized
by $580,498 Federal Home Loan Mortgage Corp.,
5.065 - 6.025%, 9/1/36 - 4/1/38 465,000
------------
$ 2,330,000
------------
Total Repurchase Agreements $ 2,330,000
- ---------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------
Principal
Amount
- ---------------------------------------------------------------------------------------
SECURITIES LENDING COLLATERAL -- 18.1% (c)
Certificates of Deposit:
$ 577,782 American Express, 2.72, 8/8/08 $ 577,782
432,472 Bank of America, 2.88%, 8/11/08 432,472
432,472 Citibank, 2.85%, 7/29/08 432,472
155,731 Banco Santander NY, 2.80%, 10/7/08 155,731
432,906 Banco Santander NY, 3.09%, 12/22/08 432,906
432,326 Bank of Nova Scotia, 3.18%, 5/05/09 432,326
216,236 Bank of Scotland NY, 2.73%, 7/11/08 216,236
216,236 Bank of Scotland NY, 2.72%, 8/15/08 216,236
155,516 Bank of Scotland NY, 2.89%, 11/4/08 155,516
216,093 Bank of Scotland NY, 3.03%, 9/26/08 216,093
778,448 Barclay's Bank, 3.18% 5/27/09 778,448
648,714 Bank Bovespa NY, 2.705%, 8/8/08 648,714
432,472 BNP Paribas NY, 2.88%, 7/23/08 432,472
259,487 Calyon NY, 2.85%, 8/25/08 259,487
363,276 Calyon NY, 2.64%, 9/29/08 363,276
137,166 Calyon NY, 2.69%, 01/16/09 137,166
358,951 Commonwealth Bank of Australia NY, 2.63%, 7/11/08 358,951
363,276 Deutsche Bank Financial, 2.72%, 7/30/08 363,276
173,005 Deutsche Bank Financial, 2.72%, 8/4/08 173,005
354,628 Dexia Bank NY, 2.69%, 8/7/08 354,628
86,489 Dexia Bank NY, 2.65%, 08/12/08 86,489
320,453 Dexia Bank NY, 3.37%, 09/29/08 320,453
778,449 DNB NOR Bank ASA NY, 2.90%, 6/8/09 778,449
37,150 Fortis, 3.11%, 09/30/08 37,150
792,288 Intesa SanPaolo S.p.A., 2.72%, 5/22/09 792,288
377,115 Lloyds Bank, 2.61%, 7/11/08 377,115
216,236 Lloyds Bank, 2.61%, 8/18/08 216,236
294,081 Natixis, 2.83%, 8/4/08 294,081
432,472 NORDEA NY, 2.81%, 8/29/08 432,472
49,971 NORDEA NY, 2.72%, 4/9/09 49,971
The accompanying notes are an integral part of these financial statements.
Pioneer Real Estate Shares | Semiannual Report | 6/30/08 17
Schedule of Investments | 6/30/08 (unaudited) (continued)
- --------------------------------------------------------------------------------
Principal
Amount Value
- --------------------------------------------------------------------------------
Certificates of Deposit: (continued)
$ 41,446 NORDEA NY, 2.73%, 12/01/08 $ 41,446
69,180 Rabobank Nederland NY, 2.37%, 8/29/08 69,180
216,236 Royal Bank of Canada NY, 2.57%, 7/15/08 216,236
432,479 Royal Bank of Canada NY, 2.6%, 9/5/08 432,479
259,483 Bank of Scotland NY, 2.7%, 8/1/08 259,483
259,665 Bank of Scotland NY, 2.96%, 11/3/08 259,665
166,935 Skandinavian Enskilda Bank NY, 2.70%, 7/17/08 166,935
50,129 Skandinavian Enskilda Bank NY, 3.18%, 09/22/08 50,129
86,283 Skandinavian Enskilda Bank NY, 3.06%, 02/13/09 86,283
172,989 Svenska Bank NY, 2.70%, 7/17/08 172,989
358,951 Svenska Bank NY, 2.55%, 7/11/08 358,951
544,914 Toronto Dominion Bank NY, 2.77%, 9/5/08 544,914
259,483 Toronto Dominion Bank NY, 2.75%, 11/5/08 259,483
86,306 Wachovia, 3.62%, 10/28/08 86,306
------------
$ 13,526,376
- --------------------------------------------------------------------------------
Commercial Paper:
$ 132,922 Bank of America, 2.70%, 8/26/08 $ 132,922
172,480 Bank of America, 2.60%, 8/11/08 172,480
129,645 CBA, 2.70%, 7/11/08 129,645
344,773 CBA, 2.88%, 8/18/08 344,773
86,446 Deutsche Bank Financial, 2.72%, 7/9/08 86,446
86,357 HSBC, 2.89% 7/21/08 86,357
429,671 HSBC, 2.88%, 9/29/08 429,671
344,905 ING Funding, 2.70%, 8/13/08 344,905
129,649 Natixis, 2.87%, 7/10/08 129,649
129,524 Natixis, 2.87%, 7/21/08 129,524
106,582 PARFIN, 3.18%, 8/1/08 106,582
171,396 Royal Bank of Scotland, 2.66%, 10/21/08 171,396
86,487 Societe Generale, 2.98%, 7/2/08 86,487
215,729 Societe Generale, 2.93%, 7/30/08 215,729
172,499 Societe Generale, 3.18%, 8/5/08 172,499
344,668 Societe Generale, 3.18%, 8/22/08 344,668
172,479 SVSS NY, 3.18%, 8/11/08 172,479
82,281 Bank Bovespa NY, 2.79%, 3/12/09 82,281
389,136 General Electric Capital Corp., 2.77%, 1/5/09 389,136
432,312 General Electric Capital Corp., 2.82%, 3/16/09 432,312
159,930 IBM, 3.18%, 2/13/09 159,930
432,472 IBM, 3.18%, 6/26/09 432,472
778,449 Met Life Global Funding, 3.16%, 6/12/09 778,449
735,202 WestPac, 3.18%, 6/1/09 735,202
------------
$ 6,265,994
- --------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
18 Pioneer Real Estate Shares | Semiannual Report | 6/30/08
- --------------------------------------------------------------------------------
Principal
Amount Value
- --------------------------------------------------------------------------------
Mutual Funds:
$ 518,966 BlackRock Liquidity Money Market Fund, 3.18% $ 518,966
674,915 Dreyfus Preferred Money Market Fund, 3.18% 674,915
------------
$ 1,193,881
- ------------------------------------------------------------------------------
Tri-party Repurchase Agreements:
1,839,535 Deutsche Bank, 2.5% 7/1/08 $ 1,839,535
5,189,660 Lehman Brothers, 2.65% 7/1/08 5,189,660
------------
$ 7,029,195
- ------------------------------------------------------------------------------
Other:
215,073 ABS CFAT 2008-A A1, 3.005%, 4/27/09 $ 215,073
------------
Total Securities Lending Collateral $ 28,230,520
- ------------------------------------------------------------------------------
TOTAL TEMPORARY CASH INVESTMENTS
(Cost $30,560,520) $ 30,560,520
- ------------------------------------------------------------------------------
TOTAL INVESTMENT IN SECURITIES -- 117.6%
(Cost $153,144,780) (a) $182,963,112
- ------------------------------------------------------------------------------
OTHER ASSETS AND LIABILITIES -- (17.6)% $(27,395,210)
- ------------------------------------------------------------------------------
TOTAL NET ASSETS -- 100.0% $155,567,902
==============================================================================
* Non-income producing security.
(a) At June 30, 2008, the net unrealized gain on investments based on cost
for federal income tax purposes of $154,277,428 was as follows:
Aggregate gross unrealized gain for all investments in
which there is an excess of value over tax cost. $39,314,534
Aggregate gross unrealized loss for all investments in
which there is an excess of tax cost over value. (10,628,850)
-----------
Net unrealized gain $28,685,684
===========
The accompanying notes are an integral part of these financial statements.
Pioneer Real Estate Shares | Semiannual Report | 6/30/08 19
Schedule of Investments | 6/30/08 (unaudited) (continued)
(b) At June 30, 2008, the following securities were out on loan:
- --------------------------------------------------------------------------------
Shares Security Value
- --------------------------------------------------------------------------------
10,000 AMB Property Corp. $ 502,800
2,500 Boston Properties, Inc. 225,175
53,900 Brandywine Realty Trust 857,010
140,000 Developers Diversified Realty Corp. 4,873,400
37,000 Digital Realty Trust, Inc. 1,502,570
22,000 Dupont Fabros Technology, Inc. 413,600
29,500 Equity Residential Property Trust 1,128,375
34,900 Extra Space Storage, Inc. 533,970
13,100 General Growth Properties, Inc. 460,072
57,000 HCP, Inc. 1,796,640
195,350 HRPT Properties Trust 1,342,055
74,055 iStar Financial, Inc. 1,001,224
82,300 Kimco Realty Corp. 2,861,570
12,200 The Macerich Co. 757,620
14,800 Nationwide Health Properties, Inc. 466,200
50,000 United Dominion Realty Trust, Inc. 1,119,000
86,000 Vornado Realty Trust 7,495,760
- --------------------------------------------------------------------------------
Total $27,337,041
================================================================================
(c) Securities lending collateral is managed by Credit Suisse.
Purchases and sales of securities (excluding temporary cash investments) for
the period ended June 30, 2008 aggregated 5,398,851 and 17,422,822
respectively.
Various inputs are used in determining the value of the Fund's investments.
These inputs are summarized in the three broad levels listed below.
Highest priority is given to Level 1 inputs and lowest priority is given to
Level 3.
Level 1 -- quoted prices in active markets for identical securities
Level 2 -- other significant observable inputs (including quoted prices for
similar securities, interest rates, prepayment speeds, credit risk,
etc.)
Level 3 -- significant unobservable inputs (including the Fund's own
assumptions in determining fair value of investments)
The following is a summary of the inputs used as of June 30, 2008, in valuing
the Fund's assets:
- -------------------------------------------------------------------------------------
Other
Investments in Financial
Valuation Inputs Securities Instruments*
- -------------------------------------------------------------------------------------
Level 1 -- Quoted Prices $ 152,402,592 --
Level 2 -- Other Significant Observable Inputs 30,560,520 --
Level 3 -- Significant Unobservable Inputs -- --
- -------------------------------------------------------------------------------------
Total $ 182,963,112 --
=====================================================================================
The accompanying notes are an integral part of these financial statements.
20 Pioneer Real Estate Shares | Semiannual Report | 6/30/08
Statement of Assets and Liabilities | 6/30/08 (unaudited)
ASSETS:
Investment in securities (including securities loaned of $27,337,042)
(cost $153,144,780) $182,963,112
Cash 269,750
Receivables -
Investment securities sold 36,478
Fund shares sold 54,681
Dividends and interest 768,076
Other 45,865
- ----------------------------------------------------------------------------------------
Total assets $184,137,962
- ----------------------------------------------------------------------------------------
LIABILITIES:
Payables -
Investment securities purchased $ 61,873
Fund shares repurchased 180,548
Upon return of securities loaned 28,230,520
Due to affiliates 54,499
Accrued expenses 42,620
- ----------------------------------------------------------------------------------------
Total liabilities $ 28,570,060
- ----------------------------------------------------------------------------------------
NET ASSETS:
Paid-in capital $129,304,180
Undistributed net investment income 162,830
Accumulated net realized loss on investments (3,717,440)
Net unrealized gain on investments 29,818,332
- ----------------------------------------------------------------------------------------
Total net assets $155,567,902
- ----------------------------------------------------------------------------------------
NET ASSET VALUE PER SHARE:
(No par value, Unlimited number of shares authorized)
Class A (based on $88,811,459/4,245,308 shares) $ 20.92
Class B (based on $15,422,288/745,899 shares) $ 20.68
Class C (based on $13,245,881/639,653 shares) $ 20.71
Class Y (based on $38,088,274/1,823,630 shares) $ 20.89
MAXIMUM OFFERING PRICE:
Class A ($20.92 [divided by] 94.25%) $ 22.20
========================================================================================
The accompanying notes are an integral part of these financial statements.
Pioneer Real Estate Shares | Semiannual Report | 6/30/08 21
Statement of Operations (unaudited)
For the Six Months Ended 6/30/08
INVESTMENT INCOME:
Dividends (net of foreign taxes withheld of $11,340) $3,677,529
Interest 74,848
Income from securities loaned, net 45,295
- -----------------------------------------------------------------------------------------
Total investment income $ 3,797,672
- -----------------------------------------------------------------------------------------
EXPENSES:
Management fees $ 669,677
Transfer agent fees and expenses
Class A 150,965
Class B 48,155
Class C 29,404
Class Y 440
Distribution fees
Class A 120,439
Class B 84,389
Class C 70,621
Administrative fees 18,835
Custodian fees 15,884
Registration fees 30,932
Professional fees 28,273
Printing expense 19,727
Fees and expenses of nonaffiliated trustees 3,529
Miscellaneous 20,431
- -----------------------------------------------------------------------------------------
Total expenses $ 1,311,701
Less fees paid indirectly (4,701)
- -----------------------------------------------------------------------------------------
Net expenses $ 1,307,000
- -----------------------------------------------------------------------------------------
Net investment income $ 2,490,672
- -----------------------------------------------------------------------------------------
REALIZED AND UNREALIZED LOSS ON INVESTMENTS
Net realized loss on investments $ (2,584,792)
- -----------------------------------------------------------------------------------------
Change in net unrealized loss on investments $ (5,388,787)
- -----------------------------------------------------------------------------------------
Net loss on investments $ (7,973,579)
- -----------------------------------------------------------------------------------------
Net decrease in net assets resulting from operations $ (5,482,907)
=========================================================================================
The accompanying notes are an integral part of these financial statements.
22 Pioneer Real Estate Shares | Semiannual Report | 6/30/08
Statement of Changes in Net Assets
For the Six Months Ended 6/30/08 and the Year Ended 12/31/07, respectively
- ---------------------------------------------------------------------------------------------
Six Months Ended
6/30/08 Year Ended
(unaudited) 12/31/07
- ---------------------------------------------------------------------------------------------
FROM OPERATIONS:
Net investment income $ 2,490,672 $ 2,590,458
Net realized gain (loss) on investments (2,584,792) 28,550,165
Change in net unrealized loss on investments (5,388,787) (78,881,246)
- ---------------------------------------------------------------------------------------------
Net decrease in net assets resulting from operations $ (5,482,907) $(47,740,623)
- ---------------------------------------------------------------------------------------------
DISTRIBUTIONS TO SHAREOWNERS:
Net investment income:
Class A ($0.36 and $0.36 per share, respectively) $ (1,536,578) $ (1,632,527)
Class B ($0.24 and $0.07 per share, respectively) (179,098) (65,436)
Class C ($0.26 and $0.11 per share, respectively) (165,526) (78,925)
Class Y ($0.42 and $0.50 per share, respectively) (766,744) (835,689)
Net realized gain:
Class A ($0.00 and $4.37 per share, respectively) -- (17,216,824)
Class B ($0.00 and $4.37 per share, respectively) -- (3,341,072)
Class C ($0.00 and $4.37 per share, respectively) -- (2,655,779)
Class Y ($0.00 and $4.37 per share, respectively) (7,701,384)
- ---------------------------------------------------------------------------------------------
Total distributions to shareowners $ (2,647,946) $(33,527,636)
- ---------------------------------------------------------------------------------------------
FROM FUND SHARE TRANSACTIONS:
Net proceeds from sale of shares $ 17,585,022 $ 63,752,735
Reinvestment of distributions 2,404,659 30,505,083
Cost of shares repurchased (32,213,408) (109,241,936)
- ---------------------------------------------------------------------------------------------
Net decrease in net assets resulting from fund
share transactions $ (12,223,727) $(14,984,118)
- ---------------------------------------------------------------------------------------------
Net decrease in net assets $ (20,354,580) $(96,252,377)
NET ASSETS:
Beginning of period 175,922,482 272,174,859
- ---------------------------------------------------------------------------------------------
End of period $ 155,567,902 $175,922,482
- ---------------------------------------------------------------------------------------------
Undistributed net investment income $ 162,830 $ 320,104
- ---------------------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
Pioneer Real Estate Shares | Semiannual Report | 6/30/08 23
Statement of Changes in Net Assets (continued)
'08 Shares '08 Amount '07 Shares '07 Amount
(unaudited) (unaudited)
Class A
Shares sold 522,262 $11,747,205 994,319 $ 32,914,661
Reinvestment of distributions 61,284 1,373,627 743,988 16,861,749
Less shares repurchased (790,995) (17,578,449) (2,217,291) (68,683,661)
- ----------------------------------------------------------------------------------------------
Net decrease (207,449) $(4,457,617) (478,984) $(18,907,251)
==============================================================================================
Class B
Shares sold 89,487 $ 1,986,185 209,823 $ 6,894,004
Reinvestment of distributions 7,477 165,155 140,171 3,090,523
Less shares repurchased (198,016) (4,240,058) (585,583) (18,011,134)
- ----------------------------------------------------------------------------------------------
Net decrease (101,052) $(2,088,718) (235,589) $ (8,026,607)
==============================================================================================
Class C
Shares sold 83,729 $ 1,876,534 226,661 $ 7,194,207
Reinvestment of distributions 6,383 141,563 107,365 2,374,472
Less shares repurchased (147,390) (3,147,891) (466,697) (14,390,437)
- ----------------------------------------------------------------------------------------------
Net decrease (57,278) $(1,129,794) (132,671) $ (4,821,758)
==============================================================================================
Class Y
Shares sold 90,758 $ 1,975,098 564,016 $ 16,749,863
Reinvestment of distributions 32,378 724,314 362,948 8,178,339
Less shares repurchased (341,486) (7,247,010) (290,653) (8,156,704)
- ----------------------------------------------------------------------------------------------
Net increase (decrease) (218,350) $(4,547,598) 636,311 $ 16,771,498
==============================================================================================
The accompanying notes are an integral part of these financial statements.
24 Pioneer Real Estate Shares | Semiannual Report | 6/30/08
Financial Highlights
Six Months
Ended
6/30/2008 Year Ended Year Ended Year Ended Year Ended Year Ended
(unaudited) 12/31/07 12/31/06 12/31/05 12/31/04(a) 12/31/03
Class A
Net asset value, beginning of period $ 21.94 $ 33.07 $ 25.87 $ 24.52 $ 19.55 $ 15.30
- ------------------------------------------------------------------------------------------------------------------------------------
Increase (decrease) from investment operations:
Net investment income $ 0.34 $ 0.36 $ 0.28 $ 0.28 $ 0.39 $ 0.65
Net realized and unrealized gain (loss) on investments (1.00) (6.76) 8.88 3.29 6.31 4.33
- ------------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) from investment operations $ (0.66) $ (6.40) $ 9.16 $ 3.57 $ 6.70 $ 4.98
Distributions to shareowners:
Net investment income (0.36) (0.36) (0.28) (0.24) (0.40) (0.73)
Net realized gain -- (4.37) (1.68) (1.84) (1.33) --
Tax return of capital -- -- -- (0.14) -- --
- ------------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net asset value $ (1.02) $(11.13) $ 7.20 $ 1.35 $ 4.97 $ 4.25
- ------------------------------------------------------------------------------------------------------------------------------------
Net asset value, end of period $ 20.92 $ 21.94 $ 33.07 $ 25.87 $ 24.52 $ 19.55
====================================================================================================================================
Total return* (3.11)% (19.39)% 35.79% 14.79% 35.26% 33.27%
Ratio of net expenses to average net assets+ 1.53%** 1.36% 1.37% 1.50% 1.56% 1.68%
Ratio of net investment income to average net assets+ 3.01%** 1.10% 0.98% 1.14% 1.85% 3.81%
Portfolio turnover rate 7%** 21% 20% 24% 34% 36%
Net assets, end of period (in thousands) $88,811 $97,691 $163,088 $110,217 $94,198 $61,455
Ratios with reductions for fees paid indirectly:
Net expenses 1.53%** 1.36% 1.37% 1.50% 1.56% 1.68%
Net investment income 3.01%** 1.10% 0.98% 1.14% 1.85% 3.81%
Ratios with waiver of management fees and reduction
for fees paid indirectly:
Net expenses 1.52%** 1.35% 1.36% 1.50% 1.56% 1.68%
Net investment income 3.02%** 1.11% 0.99% 1.14% 1.85% 3.81%
- ------------------------------------------------------------------------------------------------------------------------------------
(a) Effective 5/31/04 AEW Management and Advisors, L.P. became sub-advisor to
the Fund.
* Assumes initial investment at net asset value at the beginning of each
period, reinvestment of all distributions, the complete redemption of the
investment at net asset value at the end of each period, and no sales
charges. Total return would be reduced if sales charges were taken into
account.
+ Ratio with no reduction for fees paid indirectly.
** Annualized.
The accompanying notes are an integral part of these financial statements.
Pioneer Real Estate Shares | Semiannual Report | 6/30/08 25
Financial Highlights (continued)
Six Months
Ended
6/30/2008 Year Ended Year Ended Year Ended Year Ended Year Ended
(unaudited) 12/31/07 12/31/06 12/31/05 12/31/04(a) 12/31/03
Class B
Net asset value, beginning of period $ 21.68 $ 32.74 $ 25.64 $ 24.32 $ 19.40 $ 15.17
- ------------------------------------------------------------------------------------------------------------------------------------
Increase (decrease) from investment operations:
Net investment income $ 0.24 $ 0.06 $ 0.01 $ 0.06 $ 0.19 $ 0.51
Net realized and unrealized gain (loss) on investments (1.00) (6.68) 8.78 3.24 6.28 4.30
- ------------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) from investment operations $ (0.76) $ (6.61) $ 8.79 $ 3.30 $ 6.47 $ 4.81
Distributions to shareowners:
Net investment income (0.24) (0.07) (0.01) (0.05) (0.22) ( 0.58)
Net realized gain -- (4.37) (1.68) (1.84) (1.33) --
Tax return of capital -- -- -- (0.09) -- --
- ------------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net asset value $ (1.00) $ (11.06) $ 7.10 $ 1.32 $ 4.92 $ 4.23
- ------------------------------------------------------------------------------------------------------------------------------------
Net asset value, end of period $ 20.68 $ 21.68 $ 32.74 $ 25.64 $ 24.32 $ 19.40
====================================================================================================================================
Total return* (3.58)% (20.14)% 34.51% 13.72% 34.20% 32.30%
Ratio of net expenses to average net assets+ 2.54%** 2.28% 2.31% 2.42% 2.37% 2.50%
Ratio of net investment income to average net assets+ 1.98%** 0.11% 0.00%(b) 0.14% 0.96% 2.98%
Portfolio turnover rate 7%** 21% 20% 24% 34% 36%
Net assets, end of period (in thousands) $15,422 $ 18,364 $35,442 $29,992 $39,833 $37,325
Ratios with reduction for fees paid indirectly:
Net expenses 2.54%** 2.28% 2.31% 2.42% 2.37% 2.50%
Net investment income 1.98%** 0.11% 0.00%(b) 0.14% 0.96% 2.98%
Ratios with waiver of management fees and reduction
for fees paid indirectly:
Net expenses 2.53%** 2.26% 2.30% 2.42% 2.37% 2.50%
Net investment income 1.99%** 0.13% 0.01% 0.14% 0.96% 2.98%
- ------------------------------------------------------------------------------------------------------------------------------------
(a) Effective 5/31/04 AEW Management and Advisors, L.P. became sub-advisor to
the Fund.
(b) Amount rounds to less than 0.01% per share.
* Assumes initial investment at net asset value at the beginning of each
period, reinvestment of all distributions, the complete redemption of the
investment at net asset value at the end of each period, and no sales
charges. Total return would be reduced if sales charges were taken into
account.
+ Ratio with no reduction for fees paid indirectly.
** Annualized.
The accompanying notes are an integral part of these financial statements.
26 Pioneer Real Estate Shares | Semiannual Report | 6/30/08
Six Months
Ended
6/30/2008 Year Ended Year Ended Year Ended Year Ended Year Ended
(unaudited 12/31/07 12/31/06 12/31/05 12/31/04(a) 12/31/03
Class C
Net asset value, beginning of period $ 21.72 $ 32.80 $ 25.68 $ 24.35 $ 19.42 $ 15.20
- ------------------------------------------------------------------------------------------------------------------------------------
Increase (decrease) from investment operations:
Net investment income $ 0.24 $ 0.10 $ 0.02 $ 0.08 $ 0.20 $ 0.52
Net realized and unrealized gain (loss) on investments (0.99) (6.70) 8.80 3.26 6.29 4.31
- ------------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) from investment operations $ (0.75) $ (6.60) $ 8.82 $ 3.34 $ 6.49 $ 4.83
Distributions to shareowners:
Net investment income (0.26) (0.11) (0.02) (0.07) (0.23) (0.61)
Net realized gain -- (4.37) (1.68) (1.84) (1.33) --
Tax return of capital -- -- -- (0.10) -- --
- ------------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net asset value $ (1.01) $(11.08) $ 7.12 $ 1.33 $ 4.93 $ 4.22
- ------------------------------------------------------------------------------------------------------------------------------------
Net asset value, end of period $ 20.71 $ 21.72 $ 32.80 $ 25.68 $ 24.35 $ 19.42
====================================================================================================================================
Total return* (3.53)% (20.07)% 34.60% 13.85% 34.27% 32.35%
Ratio of net expenses to average net assets+ 2.38%** 2.17% 2.24% 2.32% 2.34% 2.39%
Ratio of net investment income to average net assets+ 2.16%** 0.26% 0.10% 0.27% 1.02% 3.20%
Portfolio turnover rate 7%** 21% 20% 24% 34% 36%
Net assets, end of period (in thousands) $13,246 $15,139 $27,209 $19,824 $20,675 $14,686
Ratios with reduction for fees paid indirectly:
Net expenses 2.38%** 2.17% 2.24% 2.32% 2.34% 2.39%
Net investment income 2.16%** 0.26% 0.10% 0.27% 1.02% 3.20%
Ratios with waiver of management fees and reduction
for fees paid indirectly:
Net expenses 2.38%** 2.16% 2.23% 2.32% 2.34% 2.39%
Net investment income 2.16%** 0.27% 0.11% 0.27% 1.02% 3.20%
- ------------------------------------------------------------------------------------------------------------------------------------
(a) Effective 5/31/04 AEW Management and Advisors, L.P. became sub-advisor to
the Fund.
* Assumes initial investment at net asset value at the beginning of each
period, reinvestment of all distributions, the complete redemption of the
investment at net asset value at the end of each period, and no sales
charges. Total return would be reduced if sales charges were taken into
account.
+ Ratio with no reduction for fees paid indirectly.
** Annualized.
The accompanying notes are an integral part of these financial statements.
Pioneer Real Estate Shares | Semiannual Report | 6/30/08 27
Financial Highlights (continued)
Six Months
Ended
6/30/2008 Year Ended Year Ended Year Ended Year Ended Year Ended
(unaudited) 12/31/07 12/31/06 12/31/05 12/31/04(a) 12/31/03
CLASS Y
Net asset value, beginning of period $ 21.90 $ 33.03 $ 25.84 $ 24.49 $ 19.53 $ 15.27
- ------------------------------------------------------------------------------------------------------------------------------------
Increase (decrease) from investment operations:
Net investment income $ 0.41 $ 0.49 $ 0.42 $ 0.35 $ 0.50 $ 0.76
Net realized and unrealized gain (loss) on investments (1.00) (6.75) 8.87 3.34 6.31 4.33
- ------------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) from investment operations $ (0.59) $ (6.26) $ 9.29 $ 3.69 $ 6.81 $ 5.09
Distributions to shareowners:
Net investment income (0.42) (0.50) (0.42) (0.34) (0.52) ( 0.83)
Net realized gain -- (4.37) (1.68) (1.84) (1.33) --
Tax return of capital -- -- -- (0.16) -- --
- ------------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net asset value $ (1.01) $(11.13) $ 7.19 $ 1.35 $ 4.96 $ 4.26
- ------------------------------------------------------------------------------------------------------------------------------------
Net asset value, end of period $ 20.89 $ 21.90 $ 33.03 $ 25.84 $ 24.49 $ 19.53
====================================================================================================================================
Total return* 2.81% (19.03)% 36.43% 15.36% 35.97% 34.16%
Ratio of net expenses to average net assets+ 0.97%** 0.90% 0.87% 1.00% 1.01% 1.05%
Ratio of net investment income to average net assets+ 3.57%** 1.81% 1.54% 1.84% 2.47% 4.47%
Portfolio turnover rate 7%** 21% 20% 24% 34% 36%
Net assets, end of period (in thousands) $38,088 $44,729 $46,436 $26,490 $ 9,172 $ 4,984
Ratios with reduction for fees paid indirectly:
Net expenses 0.97%** 0.90% 0.87% 1.00% 1.01% 1.05%
Net investment income 3.57%** 1.81% 1.54% 1.84% 2.47% 4.47%
Ratios with waiver of management fees and reduction
for fees paid indirectly:
Net expenses 0.97%** 0.90% 0.87% 1.00% 1.01% 1.05%
Net investment income 3.57%** 1.81% 1.54% 1.84% 2.47% 4.47%
- ------------------------------------------------------------------------------------------------------------------------------------
(a) Effective 5/31/04 AEW Management and Advisors, L.P. became sub-advisor to
the Fund.
* Assumes initial investment at net asset value at the beginning of each
period, reinvestment of all distributions, and the complete redemption of
the investment at net asset value at each end of each period.
+ Ratio with no reduction for fees paid indirectly.
** Annualized.
The accompanying notes are an integral part of these financial statements.
28 Pioneer Real Estate Shares | Semiannual Report | 6/30/08
Notes To Financial Statements | 6/30/08 (unaudited)
1. Organization and Significant Accounting Policies
Pioneer Real Estate Shares (the Fund) is a Delaware statutory trust registered
under the Investment Company Act of 1940 as a diversified, open-end management
investment company. The investment objective of the Fund is to seek long-term
growth of capital. Current income is a secondary objective.
The Fund offers four classes of shares - Class A, Class B, Class C, and Class Y
shares. Each class of shares represents an interest in the same portfolio of
investments of the Fund and has equal rights to voting, redemptions, dividends
and liquidation, except that each class of shares can bear different transfer
agent and distribution fees and have exclusive voting rights with respect to
the distribution plans that have been adopted by Class A, Class B and Class C
shareowners, respectively. There is no distribution plan for Class Y shares.
The Fund's financial statements have been prepared in conformity with U.S.
generally accepted accounting principles that require the management of the
Fund to, among other things, make estimates and assumptions that affect the
reported amounts of assets and liabilities, the disclosure of contingent assets
and liabilities at the date of the financial statements, and the reported
amounts of income, expenses and gains and losses on investments during the
reporting year. Actual results could differ from those estimates.
Information regarding the Fund's principal risks is contained in the Fund's
prospectus. Please refer to those documents when considering the Fund's risks.
Because the Fund may invest a substantial portion of its assets in Real Estate
Investment Trusts (REITs), the Fund may be subject to certain risks associated
with direct investments in REITs. REITs may be affected by changes in the value
of their underlying properties and by defaults of their borrowers or tenants.
REITs depend generally on their ability to generate cash flow to make
distributions to shareowners, and certain REITs have self-liquidation
provisions by which mortgages held may be paid in full and distributions of
capital returns may be made at any time. In addition, the performance of a REIT
may be affected by its failure to qualify for tax-free pass-through of income
under the Internal Revenue Code or its failure to maintain exemption from
registration under the Investment Company Act of 1940.
The following is a summary of significant accounting policies followed by the
Fund in the preparation of its financial statements, which are consistent with
those policies generally accepted in the investment company industry.
Pioneer Real Estate Shares | Semiannual Report | 6/30/08 29
A. Security Valuation
Security transactions are recorded on trade date. The net asset value of the
Fund is computed once daily, on each day the New York Stock Exchange (NYSE)
is open, as of the close of regular trading on the NYSE. In computing the
net asset value, securities are valued at the last sale price on the
principal exchange where they are traded. Securities that have not traded on
the date of valuation, or securities for which sale prices are not generally
reported, are valued at the mean between the last bid and asked prices.
Securities for which market quotations are not readily available are valued
at their fair values as determined by, or under the direction of, the Board
of Trustees. Trading in foreign securities is substantially completed each
day at various times prior to the close of the NYSE. The values of such
securities used in computing the net asset value of the Fund's shares are
determined as of such times. The Fund may also use the fair value of a
security, including a non-U.S. security, when the closing market price on
the principal exchange where the security is traded no longer reflects the
value of the security. At June 30, 2008, there were no securities fair
valued. Dividend income is recorded on the ex-dividend date, except that
certain dividends from foreign securities where the ex-dividend date may
have passed are recorded as soon as the Fund becomes aware of the
ex-dividend data in the exercise of reasonable diligence. Interest income is
recorded on the accrual basis. Temporary cash investments are valued at cost
which approximates market value.
Gains and losses on sales of investments are calculated on the identified
cost method for both financial reporting and federal income tax purposes.
B. Federal Income Taxes
It is the Fund's policy to comply with the requirements of the Internal
Revenue Code applicable to regulated investment companies and to distribute
all of its taxable income and net realized capital gains, if any, to its
shareowners. Therefore, no federal income tax provision is required. Tax
years prior to 2004 are closed (not subject to examination by tax
authorities) due to the expiration of statute of limitations; all other tax
years are open.
The amounts and characterizations of distributions to shareowners for
financial reporting purposes are determined in accordance with federal
income tax rules. Therefore, the sources of the Fund's distributions may be
shown in the accompanying financial statements as from or in excess of net
investment income or net realized gain on investment transactions, or as
from paid-in capital, depending on the type of book/tax differences that may
exist. A portion of the dividend income recorded by the Fund is from
distributions by publicly traded REITs, and such distributions for tax
purposes may also consist of capital gains and return of capital. The actual
return of capital and capital gains portions of such distributions will be
30 Pioneer Real Estate Shares | Semiannual Report | 6/30/08
determined by formal notifications from the REITs subsequent to the calendar
year-end. Distributions received from the REITs that are determined to be a
return of capital, are recorded by the Fund as a reduction of the cost basis
of the securities held.
The Fund has reclassified $320,073 to decrease undistributed net investment
income, $277,015 to decrease accumulated realized loss on investments and
$43,058 to increase paid in capital to reflect permanent book/tax
differences. The reclassification has no impact on the net asset value and
is designed to present the Fund's capital accounts on a tax basis.
The tax character of distributions paid during the years ended December 31,
2007 was as follows:
- --------------------------------------------------------------------------------
2007
- --------------------------------------------------------------------------------
Distributions paid from:
Ordinary income $ 3,370,381
Long-term capital gain 30,157,255
- --------------------------------------------------------------------------------
Total $33,527,636
================================================================================
The following shows the components of distributable earnings on a federal
income tax basis at December 31, 2007:
- --------------------------------------------------------------------------------
2007
- --------------------------------------------------------------------------------
Distributable earnings:
Undistributed Net Investment Income $ 320,104
Unrealized appreciation 34,074,471
- --------------------------------------------------------------------------------
Total $34,394,575
================================================================================
The difference between book basis and tax-basis unrealized appreciation is
attributable to the tax deferral of losses on wash sales.
C. Fund Shares
The Fund records sales and repurchases of its shares on trade date. Pioneer
Funds Distributor, Inc. (PFD), the principal underwriter for the Fund and a
wholly owned indirect subsidiary of UniCredit. PFD earned $1,286 in
underwriting commissions on the sale of Class A shares during the period
ended June 30, 2008.
D. Class Allocations
Income, common expenses and realized and unrealized gains and losses are
calculated at the Fund level and allocated daily to all classes of shares
based on their respective percentage of adjusted net assets at the beginning
of the day. Distribution fees are calculated based on the average daily net
asset value attributable to Class A, Class B and Class C shares of the Fund,
respectively. Class Y shares are not subject to a distribution plan (see
Note 4).
Pioneer Real Estate Shares | Semiannual Report | 6/30/08 31
Shareowners of each class participate in all expenses and fees paid to the
transfer agent, Pioneer Investment Management Shareholder Services, Inc.
(PIMSS), for its services, which are allocated based on the number of
accounts in each class and the ratable allocation of related out-of-pocket
expenses (see Note 3).
Distributions to shareowners are recorded as of the ex-dividend date.
Distributions paid by the Fund with respect to each class of shares are
calculated in the same manner, at the same time, and in the same amount,
except that Class A, Class B, Class C and Class Y can bear different
transfer agent and distribution fees.
E. Securities Lending
The Fund lends securities in its portfolio to certain broker-dealers or
other institutional investors. When entering into a loan, the Fund receives
collateral and earns income in the form of negotiated lenders' fees. The
Fund also continues to receive interest or payments in lieu of dividends on
the securities loaned. Gain or loss on the fair value of the loaned
securities that may occur during the term of the loan will be for the
account of the Fund. The loans are secured by collateral which is required
to be at least 102%, at all times, of the fair value of the securities
loaned. The amount of collateral is required to be adjusted daily to reflect
any price fluctuation in the value of the loaned securities. The Fund has
the right under the lending agreement to recover the securities from the
borrower on demand. The Fund invests cash collateral in cash equivalent
investments.
F. Repurchase Agreements
With respect to repurchase agreements entered into by the Fund, the value of
the underlying securities (collateral), including accrued interest received
from counterparties, is required to be at least equal to or in excess of the
value of the repurchase agreement at the time of purchase. The collateral
for all repurchase agreements is held in safekeeping in the customer-only
account of the Fund's custodian, or subcustodians. The Fund's investment
adviser, Pioneer Investment Management, Inc. (PIM), is responsible for
determining that the value of the collateral remains at least equal to the
repurchase price.
2. Management Agreement
PIM, a wholly owned indirect subsidiary of UniCredit, manages the Fund's
portfolio. Management fees are calculated daily at the annual rate of 0.80% of
the Fund's average daily net assets. PIM pays a portion of the fee it receives
from the Fund to AEW Management and Advisors L.P. as compensation for
sub-advisory services to the Fund.
32 Pioneer Real Estate Shares | Semiannual Report | 6/30/08
In addition, under the management and administration agreements, certain other
services and costs, including accounting, regulatory reporting and insurance
premiums, are paid by the Fund. Included in "Due to affiliates" reflected on
the statement of Assets and Liabilities is $10,535 in management fees,
administrative costs and certain other services payable at June 30, 2008.
3. Transfer Agent
PIMSS, a wholly owned indirect subsidiary of UniCredit, provides substantially
all transfer agent and shareowner services to the Fund at negotiated rates.
Included in "Due to affiliates" reflected on the Statement of Assets and
Liabilities is $39,785 in transfer agent fees payable to PIMSS at June 30,
2008.
4. Distribution Plans
The Fund adopted a Plan of Distribution with respect to Class A, Class B and
Class C shares (Class A Plan, Class B Plan and Class C Plan) in accordance with
Rule 12b-1 of the Investment Company Act of 1940. Currently under the Class A
Plan, PFD is reimbursed for distribution expenses in an amount up to 0.25% of
the Fund's average daily net assets attributable to Class A shares. Pursuant to
the Class B Plan and the Class C Plan, the Fund pays PFD 1.00% of the average
daily net assets attributable to each class of shares. The fee consists of a
0.25% service fee and a 0.75% distribution fee paid as compensation for
personal services and/or account maintenance services or distribution services
with regard to Class B and Class C shares. Prior to February 1, 2008, PFD was
reimbursed under the Plan of Distribution for distribution expenses in an
amount up to 0.25% of the average daily net assets attributable to Class A
shares. Included in "Due to affiliates" reflected on the Statement of Assets
and Liabilities is $4,179 in distribution fees payable to PFD at June 30, 2008.
In addition, redemptions of each class of shares (except Class Y shares) may be
subject to a contingent deferred sales charge (CDSC). A CDSC of 1.00% may be
imposed on redemptions of certain net asset value purchases of Class A shares
within 18 months of purchase. Class B shares that are redeemed within five
years of purchase are subject to a CDSC at declining rates beginning at 4.0%,
based on the lower of cost or market value of shares being redeemed.
Redemptions of Class C shares within one year of purchase are subject to a CDSC
of 1.00%. Proceeds from the CDSC are paid to PFD. For the six months ended June
30, 2008, CDSCs in the amount of $41,378 were paid to PFD.
5. Expense Offset Arrangements
The Fund has entered into certain expense offset arrangements with PIMSS
resulting in a reduction in the Fund's total expenses due to interest earned on
cash held by PIMSS. For the six months ended June 30, 2008, the Fund's expenses
were reduced by $4,701 under such arrangements.
Pioneer Real Estate Shares | Semiannual Report | 6/30/08 33
6. Line of Credit Facility
The Fund along with certain other funds in the Pioneer Family of Funds (the
Funds) collectively participate in a $200 million committed, unsecured
revolving line of credit facility. Borrowings are used solely for temporary or
emergency purposes. The Fund may borrow up to the lesser of $200 million or the
limits set by its prospectus for borrowings. Interest on collective borrowings
is payable at the Federal Funds Rate plus 1/2% on an annualized basis. The
Funds pay an annual commitment fee for this facility. The commitment fee is
allocated among such Funds based on their respective borrowing limits. For the
six months ended June 30, 2008, the Fund had no borrowings under this
agreement.
7. New Pronouncement
In March 2008, Statement of Financial Accounting Standards No. 161, Disclosures
about Derivative instruments and Hedging Activities (SFAS 161), was issued and
is effective for fiscal years beginning after November 15, 2008. SFAS 161
requires enhanced disclosures about an entity's derivative and hedging
activities. Management is currently evaluating the impact the adoption of SFAS
161 will have on the Fund's financial statement disclosures.
Results of Shareholder Meeting
At a special meeting held on May 13, 2008, shareholders of the Fund were asked
to consider the proposals described below. A report of the total votes cast by
the Fund's shareholders follows:
- ---------------------------------------------------------------------------------------------
Broker
For Withhold Abstain Non-Votes
- ---------------------------------------------------------------------------------------------
Proposal 1 -- To elect Trustees
John F. Cogan, Jr. 6,114,586.773 70,247.796 19,603.528 0
Daniel K. Kingsbury 6,116,108.773 68,725.796 19,603.528 0
David R. Bock 6,108,361.989 76,472.579 19,603.528 0
Mary K. Bush 6,052,713.285 132,121.283 19,603.528 0
Benjamin M. Friedman 6,112,788.312 72,046.256 19,603.528 0
Margaret B.W. Graham 6,051,663.574 133,170.995 19,603.528 0
Thomas J. Perna 6,113,838.024 70,996.545 19,603.528 0
Marguerite A. Piret 6,101,084.636 83,749.933 19,603.528 0
Stephen K. West 6,114,235.547 70,599.022 19,603.528 0
John Winthrop 6,114,524.047 70,310.522 19,603.528 0
- ------------------------------------------------------------------------------------------------------
Broker
For Against Abstain Non-Votes
- ------------------------------------------------------------------------------------------------------
Proposal 2 -- To approve an
amendment to the
Declaration of Trust 4,575,837.534 117,206.555 91,756.007 1,419,638.000
34 Pioneer Real Estate Shares | Semiannual Report | 6/30/08
- -------------------------------------------------------------------------------------------------------------
Broker
For Against Abstain Non-Votes
- -------------------------------------------------------------------------------------------------------------
Proposal 3A -- To approve
changes to the Fund's
fundamental investment
policy relating to borrowing
money 4,583,074.825 107,088.960 94,636.310 1,419,638.000
Proposal 3B -- To approve
changes to the Fund's
fundamental investment
policy relating to
underwriting 4,569,518.583 120,647.203 94,634.310 1,419,638.000
Proposal 3C -- To approve
changes to the Fund's
fundamental investment
policy relating to lending 4,577,192.978 110,974.252 96,632.866 1,419,638.000
Proposal 3D -- To approve
changes to the Fund's
fundamental investment
policy relating to issuing
senior securities 4,598,869.598 90,081.704 95,848.794 1,419,638.000
Proposal 3E -- To approve
changes to the Fund's
fundamental investment
policy relating to real estate 4,593,160.066 97,313.236 94,326.794 1,419,638.000
Proposal 3F -- To approve
changes to the Fund's
fundamental investment
policy relating to
commodities 4,584,301.165 98,163.065 102,335.866 1,419,638.000
Proposal 3G -- To approve
changes to the Fund's
fundamental investment
policy relating to
concentration 4,598,365.553 92,948.749 93,485.794 1,419,638.000
Proposal 3H -- To approve
changes to the Fund's
fundamental investment
policy relating to
diversification 4,591,536.081 102,146.221 91,177.794 1,419,638.000
Proposal 3I -- To approve
the conversion of the Fund's
investment objective from
fundamental to non-
fundamental 4,560,519.002 130,693.785 93,587.309 1,419,638.000
Pioneer Real Estate Shares | Semiannual Report | 6/30/08 35
- --------------------------------------------------------------------------------------------------------
Broker
For Against Abstain Non-Votes
- --------------------------------------------------------------------------------------------------------
Proposal 4 -- To approve an
Amended and Restated
Management Agreement
with PIM 4,638,063.107 74,017.135 72,719.854 1,419,638.000
- --------------------------------------------------------------------------------------------------------
Broker
For Against Abstain Non-Votes
- --------------------------------------------------------------------------------------------------------
Proposal 5 -- To approve
a policy allowing the
appointment of unaffiliated
sub-advisers and
amendments to sub-
advisory agreements without
shareholder approval 4,512,749.655 161,671.889 110,378.552 1,419,638.000
36 Pioneer Real Estate Shares | Semiannual Report | 6/30/08
Approval of Investment Advisory Agreement
Pioneer Investment Management, Inc. (PIM) serves as the Fund's investment
adviser pursuant to an investment advisory agreement between PIM and the Fund.
The Trustees of the Fund, as required by law, determine annually whether to
continue the investment advisory agreement for the Fund. In connection with
their most recent consideration of the investment advisory agreement for the
Fund, the Trustees received and reviewed a substantial amount of information
provided by PIM in response to requests of the independent Trustees and their
independent legal counsel. The independent Trustees met on a number of
occasions with PIM and also separately with their independent legal counsel to
evaluate and discuss the information provided to them by PIM. At a meeting held
on November 13, 2007, based on their evaluation of the information provided by
PIM, the Trustees, including the independent Trustees voting separately,
unanimously approved the continuation of the investment advisory agreement for
another year.
At a meeting held on January 8, 2008, the Trustees considered whether an
amended and restated investment advisory agreement for the Fund should be
approved for an initial period ending December 31, 2009. The management fee to
be paid by the Fund to PIM under the amended and restated investment advisory
agreement is the same as the management fee provided in the previously approved
investment advisory agreement. Based on their evaluation of the information
provided by PIM, including the information provided by PIM in connection with
the Trustees' most recent approval of the continuation of the previous
investment advisory agreement, the Trustees, including the independent Trustees
voting separately, unanimously approved the amended and restated investment
advisory agreement. Shareholders of the Fund approved the amended and restated
investment advisory agreement at a meeting held on May 13, 2008.
In considering the amended and restated investment advisory agreement, the
Trustees considered various factors that they determined were relevant,
including the factors described below. The Trustees did not identify any single
factor as the controlling factor in determining to approve the amended and
restated investment advisory agreement.
Nature, Extent and Quality of Services
The Trustees considered the nature, extent and quality of the services that
were provided by PIM to the Fund under the previous investment advisory
agreement, and that would continue to be provided by PIM to the Fund under the
amended and restated investment advisory agreement, taking into account the
investment objective and strategy of the Fund and the information related to
Pioneer Real Estate Shares | Semiannual Report | 6/30/08 37
the Fund provided to the Trustees at each quarterly meeting. The Trustees
reviewed the terms of the amended and restated investment advisory agreement.
The Trustees also reviewed PIM's investment approach for the Fund and its
research process. The Trustees considered the resources of PIM and the
personnel of PIM who provide investment management services to the Fund. They
also considered PIM's compliance and legal resources and personnel.
In addition, the Trustees considered the other services that PIM provided under
the previous investment advisory agreement and that PIM would continue to
provide to the Fund under the amended and restated investment advisory
agreement and that, as administrator, PIM is responsible for the administration
of the Fund's business and other affairs. It was noted that PIM supervises and
monitors the performance of the Fund's service providers and provides the Fund
with personnel (including officers) as are necessary for the Fund's operations.
The Trustees considered the fees paid to PIM for the provision of such
services.
Based on these considerations, the Trustees concluded that the nature, extent
and quality of services that PIM would continue to provide to the Fund under
the amended and restated investment advisory agreement, were satisfactory and
consistent with the terms of the amended and restated investment advisory
agreement.
Performance of the Fund
The Trustees considered the performance results of the Fund over various time
periods. They reviewed information comparing the Fund's performance with the
average performance of its peer group of funds as classified by Morningstar,
Inc. (Morningstar), an independent provider of investment company data, and
with the performance of the Fund's benchmark index. The Trustees considered
that the Fund's annualized total return was in the fourth quintile of its
Morningstar category for the one year period ended June 30, 2007, in the second
quintile of its Morningstar category for the three year period ended June 30,
2007 and in the third quintile of its Morningstar category for the five year
period ended June 30, 2007. (In all quintile rankings referred to throughout
this disclosure, first quintile is most favorable to the Fund's shareowners.
Thus, highest relative performance would be first quintile and lowest relative
expenses would also be first quintile.) After discussing the reasons for the
Fund's short-term underperformance with PIM, the Trustees concluded that the
investment performance of the Fund was satisfactory.
Management Fee and Expenses
The Trustees considered that the management fee to be paid by the Fund to PIM
under the amended and restated investment advisory agreement would be the same
as the management fee to be paid by the Fund under the previously approved
investment advisory agreement. The Trustees considered information on the fees
and expenses of the Fund in comparison to the management
38 Pioneer Real Estate Shares | Semiannual Report | 6/30/08
fees of its peer group of funds as classified by Morningstar and the expense
ratios of a peer group of funds selected on the basis of criteria determined by
the independent Trustees for this purpose using data provided by Strategic
Insight Mutual Fund Research and Consulting, LLC (Strategic Insight), an
independent third party.
The Trustees considered that the Fund's management fee for the twelve months
ended June 30, 2007 was in the second quintile relative to the management fees
paid by other funds in its peer group Morningstar category for the comparable
period. The Trustees also considered that the Fund's expense ratio for the
twelve months ended June 30, 2007 was in the second quintile relative to its
Strategic Insight peer group. It was noted that PIM did not currently manage
any accounts with an investment objective and strategies that were similar to
the Fund.
The Trustees concluded that the management fee payable by the Fund to PIM was
reasonable in relation to the nature and quality of services provided, taking
into account the fees charged by other advisers for managing comparable mutual
funds with similar strategies. The Trustees also concluded that the Fund's
expense ratio was reasonable, taking into account the size of the Fund, the
quality of services provided by PIM and the investment performance of the Fund.
Profitability
The Trustees considered information provided by PIM regarding the profitability
of PIM with respect to the advisory services provided by PIM to the Fund,
including the methodology used by PIM in allocating certain of its costs to the
management of the Fund. The Trustees also considered PIM's profit margin in
connection with the overall operation of the Fund. They further reviewed the
financial results realized by PIM and its affiliates from non-fund businesses.
The Trustees considered PIM's profit margins with respect to the Fund in
comparison to the limited industry data available and noted that the
profitability of any adviser was affected by numerous factors, including its
organizational structure and method for allocating expenses. The Trustees
recognized that PIM should be entitled to earn a reasonable level of profit for
the services provided to the Fund. The Trustees concluded that PIM's
profitability with respect to the management of the Fund was not unreasonable.
Economies of Scale
The Trustees considered the economies of scale with respect to the management
of the Fund, whether the Fund had appropriately benefited from any economies of
scale, and whether there was potential for realization of any further economies
of scale.
The Trustees considered that, although the Fund pays a management fee at a
fixed rate as a percentage of the Fund's net assets, without any breakpoints,
the management fee rate paid by the Fund for the twelve months ended June 30,
Pioneer Real Estate Shares | Semiannual Report | 6/30/08 39
2007 was in the second quintile relative to the management fees paid by other
funds in its peer group Morningstar category for the comparable period and
that, on a hypothetical basis, such fee would be in the second or third
quintile relative to the peer group at higher asset levels. The Trustees also
considered the relatively small size of the Fund compared to its peer group
Morningstar category. The Trustees concluded that, at current and reasonably
foreseeable asset levels, breakpoints in the management fee were not currently
necessary.
Other Benefits
The Trustees considered the other benefits to PIM from its relationship with
the Fund. The Trustees considered that affiliates of PIM serve as the Fund's
transfer agent and distributor. The Trustees considered the receipt by PIM and
its affiliates of sales loads and payments under Rule 12b-1 plans in respect of
the Fund and the other Pioneer funds. The Trustees further considered the
intangible benefits to PIM by virtue of its relationship with the Fund and the
other Pioneer funds. The Trustees concluded that the receipt of these benefits
was reasonable in the context of the overall relationship between PIM and the
Fund.
Conclusion
After consideration of the factors described above as well as other factors,
the Trustees, including all of the independent Trustees, concluded that the
terms of the amended and restated investment advisory agreement between PIM and
the Fund, including the fees payable thereunder, were fair and reasonable and
voted to approve the amended and restated investment advisory agreement for the
Fund.
40 Pioneer Real Estate Shares | Semiannual Report | 6/30/08
Trustees, Officers and Service Providers
Trustees Officers
John F. Cogan, Jr., Chairman John F. Cogan, Jr., President
David R. Bock Daniel K. Kingsbury, Executive
Mary K. Bush Vice President
Benjamin M. Friedman Mark E. Bradley, Treasurer
Margaret B.W. Graham Dorothy E. Bourassa, Secretary
Daniel K. Kingsbury
Thomas J. Perna
Marguerite A. Piret
Stephen K. West
John Winthrop
Investment Adviser and Administrator
Pioneer Investment Management, Inc.
Custodian
Brown Brothers Harriman & Co.
Principal Underwriter
Pioneer Funds Distributor, Inc.
Legal Counsel
Bingham McCutchen LLP
Shareowner Services and Transfer Agent
Pioneer Investment Management Shareholder Services, Inc.
Proxy Voting Policies and Procedures of the Fund are available without charge,
upon request, by calling our toll free number (1-800-225-6292). Information
regarding how the Fund voted proxies relating to portfolio securities during
the most recent 12-month period ended June 30 is publicly available to
shareowners at pioneerinvestments.com. This information is also available on
the Securities and Exchange Commission's web site at http://www.sec.gov.
Pioneer Real Estate Shares | Semiannual Report | 6/30/08 41
This page for your notes.
42 Pioneer Real Estate Shares | Semiannual Report | 6/30/08
This page for your notes.
Pioneer Real Estate Shares | Semiannual Report | 6/30/08 43
This page for your notes.
44 Pioneer Real Estate Shares | Semiannual Report | 6/30/08
How To Contact Pioneer
We are pleased to offer a variety of convenient ways for you to contact us for
assistance or information.
Call us for:
- --------------------------------------------------------------------------------
Account Information, including existing accounts,
new accounts, prospectuses, applications
and service forms 1-800-225-6292
FactFone(SM) for automated fund yields, prices,
account information and transactions 1-800-225-4321
Retirement plans information 1-800-622-0176
Telecommunications Device for the Deaf (TDD) 1-800-225-1997
Write to us:
- --------------------------------------------------------------------------------
PIMSS, Inc.
P.O. Box 55014
Boston, Massachusetts 02205-5014
Our toll-free fax 1-800-225-4240
Our internet e-mail address ask.pioneer@pioneerinvestments.com
(for general questions about Pioneer only)
Visit our web site: pioneerinvestments.com
This report must be preceded or accompanied by a prospectus.
The Fund files a complete schedule of investments with the Securities and
Exchange Commission for the first and third quarters for each fiscal year on
Form N-Q. Shareholders may view the filed Form N-Q by visiting the Commission's
web site at http://www.sec.gov. The filed form may also be viewed and copied at
the Commission's Public Reference Room in Washington, DC. Information regarding
the operations of the Public Reference Room may be obtained by calling
1-800-SEC-0330.
ITEM 2. CODE OF ETHICS.
(a) Disclose whether, as of the end of the period covered by the report, the
registrant has adopted a code of ethics that applies to the registrant'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 registrant or a third party. If
the registrant has not adopted such a code of ethics, explain why it has not
done so.
The registrant has adopted, as of the end of the period covered by this report,
a code of ethics that applies to the registrant's principal executive officer,
principal financial officer, principal accounting officer and controller.
(b) For purposes of this Item, the term "code of ethics" means written standards
that are reasonably designed to deter wrongdoing and to promote:
(1) Honest and ethical conduct, including the ethical handling of actual
or apparent conflicts of interest between personal and professional
relationships;
(2) Full, fair, accurate, timely, and understandable disclosure in
reports and documents that a registrant files with, or submits to, the
Commission and in other public communications made by the registrant;
(3) Compliance with applicable governmental laws, rules, and
regulations;
(4) The prompt internal reporting of violations of the code to an
appropriate person or persons identified in the code; and
(5) Accountability for adherence to the code.
(c) The registrant must briefly describe the nature of any amendment, during the
period covered by the report, to a provision of its code of ethics that applies
to the registrant'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
registrant or a third party, and that relates to any element of the code of
ethics definition enumerated in paragraph (b) of this Item. The registrant must
file a copy of any such amendment as an exhibit pursuant to Item 10(a), unless
the registrant has elected to satisfy paragraph (f) of this Item by posting its
code of ethics on its website pursuant to paragraph (f)(2) of this Item, or by
undertaking to provide its code of ethics to any person without charge, upon
request, pursuant to paragraph (f)(3) of this Item.
The registrant has made no amendments to the code of ethics during the period
covered by this report.
(d) If the registrant has, during the period covered by the report, granted a
waiver, including an implicit waiver, from a provision of the code of ethics to
the registrant'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
registrant or a third party, that relates to one or more of the items set forth
in paragraph (b) of this Item, the registrant must briefly describe the nature
of the waiver, the name of the person to whom the waiver was granted, and the
date of the waiver.
Not applicable.
(e) If the registrant intends to satisfy the disclosure requirement under
paragraph (c) or (d) of this Item regarding an amendment to, or a waiver from,
a provision of its code of ethics that applies to the registrant's principal
executive officer, principal financial officer, principal accounting officer or
controller, or persons performing similar functions and that relates to any
element of the code of ethics definition enumerated in paragraph (b) of this
Item by posting such information on its Internet website, disclose the
registrant's Internet address and such intention.
Not applicable.
(f) The registrant must:
(1) File with the Commission, pursuant to Item 10(a), a copy of its code
of ethics that applies to the registrant's principal executive officer,
principal financial officer, principal accounting officer or controller,
or persons performing similar functions, as an exhibit to its annual
report on this Form N-CSR;
(2) Post the text of such code of ethics on its Internet website and
disclose, in its most recent report on this Form N-CSR, its Internet
address and the fact that it has posted such code of ethics on its
Internet website; or
(3) Undertake in its most recent report on this Form N-CSR to provide to
any person without charge, upon request, a copy of such code of ethics
and explain the manner in which such request may be made.
See Item 10(2)
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.
(a) (1) Disclose that the registrant's board of trustees has determined that
the registrant either:
(i) Has at least one audit committee financial expert serving on its audit
committee; or
(ii) Does not have an audit committee financial expert serving on its audit
committee.
The registrant's Board of Trustees has determined that the registrant has at
least one audit committee financial expert.
(2) If the registrant provides the disclosure required by paragraph
(a)(1)(i) of this Item, it must disclose the name of the audit committee
financial expert and whether that person is "independent." In order to be
considered "independent" for purposes of this Item, a member of an audit
committee may not, other than in his or her capacity as a member of the audit
committee, the board of trustees, or any other board committee:
(i) Accept directly or indirectly any consulting, advisory, or other
compensatory fee from the issuer; or
(ii) Be an "interested person" of the investment company as defined in
Section 2(a)(19) of the Act (15 U.S.C. 80a-2(a)(19)).
Ms. Marguerite A. Piret, an independent trustee, is such an audit committee
financial expert.
(3) If the registrant provides the disclosure required by paragraph (a)(1)
(ii) of this Item, it must explain why it does not have an audit committee
financial expert.
Not applicable.
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.
(a) Disclose, under the caption AUDIT FEES, 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 registrant'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.
N/A
(b) Disclose, under the caption AUDIT-RELATED FEES, 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 registrant's financial statements and are not reported under
paragraph (a) of this Item. Registrants shall describe the nature of the
services comprising the fees disclosed under this category.
N/A
(c) Disclose, under the caption TAX FEES, 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. Registrants shall
describe the nature of the services comprising the fees disclosed under this
category.
N/A
(d) Disclose, under the caption ALL OTHER FEES, 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. Registrants shall describe the nature of the services
comprising the fees disclosed under this category.
N/A
(e) (1) Disclose the audit committee's pre-approval policies and procedures
described in paragraph (c)(7) of Rule 2-01 of Regulation S-X.
PIONEER FUNDS
APPROVAL OF AUDIT, AUDIT-RELATED, TAX AND OTHER SERVICES
PROVIDED BY THE INDEPENDENT AUDITOR
SECTION I - POLICY PURPOSE AND APPLICABILITY
The Pioneer Funds recognize the importance of maintaining the independence of
their outside auditors. Maintaining independence is a shared responsibility
involving Pioneer Investment Management, Inc ("PIM"), the audit committee and
the independent auditors.
The Funds recognize that a Fund's independent auditors: 1) possess knowledge of
the Funds, 2) are able to incorporate certain services into the scope of the
audit, thereby avoiding redundant work, cost and disruption of Fund personnel
and processes, and 3) have expertise that has value to the Funds. As a result,
there are situations where it is desirable to use the Fund's independent
auditors for services in addition to the annual audit and where the potential
for conflicts of interests are minimal. Consequently, this policy, which is
intended to comply with Rule 210.2-01(C)(7), sets forth guidelines and
procedures to be followed by the Funds when retaining the independent audit firm
to perform audit, audit-related tax and other services under those
circumstances, while also maintaining independence.
Approval of a service in accordance with this policy for a Fund shall also
constitute approval for any other Fund whose pre-approval is required pursuant
to Rule 210.2-01(c)(7)(ii).
In addition to the procedures set forth in this policy, any non-audit services
that may be provided consistently with Rule 210.2-01 may be approved by the
Audit Committee itself and any pre-approval that may be waived in accordance
with Rule 210.2-01(c)(7)(i)(C) is hereby waived.
Selection of a Fund's independent auditors and their compensation shall be
determined by the Audit Committee and shall not be subject to this policy.
SECTION II - POLICY
- ---------------- -------------------------------- -------------------------------------------------
SERVICE SERVICE CATEGORY DESCRIPTION SPECIFIC PRE-APPROVED SERVICE SUBCATEGORIES
CATEGORY
- ---------------- -------------------------------- -------------------------------------------------
I. AUDIT Services that are directly o Accounting research assistance
SERVICES related to performing the o SEC consultation, registration
independent audit of the Funds statements, and reporting
o Tax accrual related matters
o Implementation of new accounting
standards
o Compliance letters (e.g. rating agency
letters)
o Regulatory reviews and assistance
regarding financial matters
o Semi-annual reviews (if requested)
o Comfort letters for closed end
offerings
- ---------------- -------------------------------- -------------------------------------------------
II. Services which are not o AICPA attest and agreed-upon procedures
AUDIT-RELATED prohibited under Rule o Technology control assessments
SERVICES 210.2-01(C)(4) (the "Rule") o Financial reporting control assessments
and are related extensions of o Enterprise security architecture
the audit services support the assessment
audit, or use the
knowledge/expertise gained
from the audit procedures as a
foundation to complete the
project. In most cases, if
the Audit-Related Services are
not performed by the Audit
firm, the scope of the Audit
Services would likely
increase. The Services are
typically well-defined and
governed by accounting
professional standards (AICPA,
SEC, etc.)
- ---------------- -------------------------------- -------------------------------------------------
------------------------------------- ------------------------------------
AUDIT COMMITTEE APPROVAL POLICY AUDIT COMMITTEE
REPORTING POLICY
------------------------------------- ------------------------------------
o "One-time" pre-approval o A summary of all such
for the audit period for all services and related fees
pre-approved specific service reported at each regularly
subcategories. Approval of the scheduled Audit Committee
independent auditors as meeting.
auditors for a Fund shall
constitute pre approval for
these services.
------------------------------------- ------------------------------------
o "One-time" pre-approval o A summary of all such
for the fund fiscal year within services and related fees
a specified dollar limit (including comparison to
for all pre-approved specified dollar limits)
specific service subcategories reported quarterly.
o Specific approval is
needed to exceed the
pre-approved dollar limit for
these services (see general
Audit Committee approval policy
below for details on obtaining
specific approvals)
o Specific approval is
needed to use the Fund's
auditors for Audit-Related
Services not denoted as
"pre-approved", or
to add a specific service
subcategory as "pre-approved"
------------------------------------- ------------------------------------
SECTION III - POLICY DETAIL, CONTINUED
- ----------------------- --------------------------- -----------------------------------------------
SERVICE CATEGORY SERVICE CATEGORY SPECIFIC PRE-APPROVED SERVICE SUBCATEGORIES
DESCRIPTION
- ----------------------- --------------------------- -----------------------------------------------
III. TAX SERVICES Services which are not o Tax planning and support
prohibited by the Rule, o Tax controversy assistance
if an officer of the Fund o Tax compliance, tax returns, excise
determines that using the tax returns and support
Fund's auditor to provide o Tax opinions
these services creates
significant synergy in
the form of efficiency,
minimized disruption, or
the ability to maintain a
desired level of
confidentiality.
- ----------------------- --------------------------- -----------------------------------------------
- ------------------------------------- -------------------------
AUDIT COMMITTEE APPROVAL POLICY AUDIT COMMITTEE
REPORTING POLICY
- ------------------------------------- -------------------------
- ------------------------------------- -------------------------
o "One-time" pre-approval o A summary of
for the fund fiscal year all such services and
within a specified dollar limit related fees
(including comparison
to specified dollar
limits) reported
quarterly.
o Specific approval is
needed to exceed the
pre-approved dollar limits for
these services (see general
Audit Committee approval policy
below for details on obtaining
specific approvals)
o Specific approval is
needed to use the Fund's
auditors for tax services not
denoted as pre-approved, or to add a specific
service subcategory as
"pre-approved"
- ------------------------------------- -------------------------
SECTION III - POLICY DETAIL, CONTINUED
- ----------------------- --------------------------- -----------------------------------------------
SERVICE CATEGORY SERVICE CATEGORY SPECIFIC PRE-APPROVED SERVICE SUBCATEGORIES
DESCRIPTION
- ----------------------- --------------------------- -----------------------------------------------
IV. OTHER SERVICES Services which are not o Business Risk Management support
prohibited by the Rule, o Other control and regulatory
A. SYNERGISTIC, if an officer of the Fund compliance projects
UNIQUE QUALIFICATIONS determines that using the
Fund's auditor to provide
these services creates
significant synergy in
the form of efficiency,
minimized disruption,
the ability to maintain a
desired level of
confidentiality, or where
the Fund's auditors
posses unique or superior
qualifications to provide
these services, resulting
in superior value and
results for the Fund.
- ----------------------- --------------------------- -----------------------------------------------
- --------------------------------------- ------------------------
AUDIT COMMITTEE APPROVAL POLICY AUDIT COMMITTEE
REPORTING POLICY
- ------------------------------------- --------------------------
o "One-time" pre-approval o A summary of
for the fund fiscal year within all such services and
a specified dollar limit related fees
(including comparison
to specified dollar
limits) reported
quarterly.
o Specific approval is
needed to exceed the
pre-approved dollar limits for
these services (see general
Audit Committee approval policy
below for details on obtaining
specific approvals)
o Specific approval is
needed to use the Fund's
auditors for "Synergistic" or
"Unique Qualifications" Other
Services not denoted as
pre-approved to the left, or to
add a specific service
subcategory as "pre-approved"
- ------------------------------------- --------------------------
SECTION III - POLICY DETAIL, CONTINUED
- ----------------------- ------------------------- -----------------------------------------------
SERVICE CATEGORY SERVICE CATEGORY SPECIFIC PROHIBITED SERVICE SUBCATEGORIES
DESCRIPTION
- ----------------------- ------------------------- -----------------------------------------------
PROHIBITED SERVICES Services which result 1. Bookkeeping or other services
in the auditors losing related to the accounting records or
independence status financial statements of the audit
under the Rule. client*
2. Financial information systems design
and implementation*
3. Appraisal or valuation services,
fairness* opinions, or
contribution-in-kind reports
4. Actuarial services (i.e., setting
actuarial reserves versus actuarial
audit work)*
5. Internal audit outsourcing services*
6. Management functions or human
resources
7. Broker or dealer, investment
advisor, or investment banking services
8. Legal services and expert services
unrelated to the audit
9. Any other service that the Public
Company Accounting Oversight Board
determines, by regulation, is
impermissible
- ----------------------- ------------------------- -----------------------------------------------
- ------------------------------------------- ------------------------------
AUDIT COMMITTEE APPROVAL POLICY AUDIT COMMITTEE
REPORTING POLICY
- ------------------------------------------- ------------------------------
o These services are not to be o A summary of all
performed with the exception of the(*) services and related
services that may be permitted fees reported at each
if they would not be subject to audit regularly scheduled
procedures at the audit client (as Audit Committee meeting
defined in rule 2-01(f)(4)) level will serve as continual
the firm providing the service. confirmation that has
not provided any
restricted services.
- ------------------------------------------- ------------------------------
- --------------------------------------------------------------------------------
GENERAL AUDIT COMMITTEE APPROVAL POLICY:
o For all projects, the officers of the Funds and the Fund's auditors will each
make an assessment to determine that any proposed projects will not impair
independence.
o Potential services will be classified into the four non-restricted service
categories and the "Approval of Audit, Audit-Related, Tax and Other
Services" Policy above will be applied. Any services outside the specific
pre-approved service subcategories set forth above must be specifically
approved by the Audit Committee.
o At least quarterly, the Audit Committee shall review a report summarizing the
services by service category, including fees, provided by the Audit firm as
set forth in the above policy.
- --------------------------------------------------------------------------------
(2) Disclose the percentage of services described in each of paragraphs (b)
through (d) of this Item that were approved by the audit committee pursuant
to paragraph (c)(7)(i)(C) of Rule 2-01 of Regulation S-X.
N/A
(f) If greater than 50 percent, disclose the percentage of hours expended on the
principal accountant's engagement to audit the registrant'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.
N/A
(g) Disclose the aggregate non-audit fees billed by the registrant's accountant
for services rendered to the registrant, and 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 adviser that provides ongoing services to the registrant for each of
the last two fiscal years of the registrant.
N/A
(h) Disclose whether 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 subadviser 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.
The Fund's audit committee of the Board of Trustees has
considered whether the provision of non-audit services that
were rendered to the Affiliates (as defined) 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.
Item 5. Audit Committee of Listed Registrants
(a) If the registrant is a listed issuer as defined in Rule 10A-3
under the Exchange Act (17 CFR 240.10A-3), state whether
or not the registrant has a separately-designated standing
audit committee established in accordance with Section
3(a)(58)(A) of the Exchange Act (15 U.S.C. 78c(a)(58)(A)).
If the registrant has such a committee, however designated,
identify each committee member. If the entire board of directors
is acting as the registrants audit committee as specified in
Section 3(a)(58)(B) of the Exchange Act (15 U.S.C. 78c(a)(58)(B)),
so state.
N/A
(b) If applicable, provide the disclosure required by Rule 10A-3(d)
under the Exchange Act (17 CFR 240.10A-3(d)) regarding an exemption
from the listing standards for audit committees.
N/A
Item 6. Schedule of Investments.
File Schedule I Investments in securities of unaffiliated issuers
as of the close of the reporting period as set forth in 210.12-
12 of Regulation S-X [17 CFR 210.12-12], unless the schedule is
included as part of the report to shareholders filed under Item
1 of this Form.
Included in Item 1
ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR
CLOSED-END MANAGEMENT INVESTMENT COMPANIES.
A closed-end management investment company that is filing an annual report on
this Form N-CSR must, unless it invests exclusively in non-voting securities,
describe the policies and procedures that it uses to determine how to vote
proxies relating to portfolio securities, including the procedures that the
company uses when a vote presents a conflict between the interests of its
shareholders, on the one hand, and those of the company's investment adviser;
principal underwriter; or any affiliated person (as defined in Section 2(a)(3)
of the Investment Company Act of 1940 (15 U.S.C. 80a-2(a)(3)) and the rules
thereunder) of the company, its investment adviser, or its principal
underwriter, on the other. Include any policies and procedures of the company's
investment adviser, or any other third party, that the company uses, or that are
used on the company's behalf, to determine how to vote proxies relating to
portfolio securities.
Not applicable to open-end management investment companies.
Item 8. Portfolio Managers of Closed-End Management Investment
Companies.
(a) If the registrant is a closed-end management investment company that
is filing an annual report on this Form N-CSR,provide the following
information:
(1) State the name, title, and length of service of the person or persons
employed by or associated with the registrant or an investment adviser
of the registrant who are primarily responsible for the day-to-day management
of the registrants portfolio (Portfolio Manager). Also state each Portfolio
Managers business experience during the past 5 years.
Not applicable to open-end management investment companies.
Item 9. Purchases of Equity Securities by Closed-End Management
Investment Company and Affiliated Purchasers.
(a) If the registrant is a closed-end management investment company,
in the following tabular format, provide the information specified in
paragraph (b) of this Item with respect to any purchase made by or on
behalf of the registrant or any affiliated purchaser, as defined in
Rule 10b-18(a)(3) under the Exchange Act (17 CFR 240.10b-18(a)(3)), of
shares or other units of any class of the registrants equity securities
that is registered by the registrant pursuant to Section 12 of the
Exchange Act (15 U.S.C. 781). Instruction to paragraph (a). Disclose
all purchases covered by this Item, including purchases that do not
satisfy the conditions of the safe harbor of Rule 10b-18 under the
Exchange Act (17 CFR 240.10b-18), made in the period covered by the
report. Provide disclosures covering repurchases made on a monthly basis.
For example, if the reporting period began on January 16 and ended on
July 15, the chart would show repurchases for the months from January 16
through February 15, February 16 through March 15, March 16 through
April 15, April 16 through May 15, May 16 through June 15, and June 16
through July 15.
Not applicable to open-end management investment companies.
Item 10. Submission of Matters to a Vote of Security Holders.
Describe any material changes to the procedures by which shareholders
may recommend nominees to the registrants board of directors, where
those changes were implemented after the registrant last provided
disclosure in response to the requirements of Item 7(d)(2)(ii)(G)
of Schedule 14A (17 CFR 240.14a-101), or this Item.
There have been no material changes to the procedures by which the
shareholders may recommend nominees to the registrants board of
directors since the registrant last provided disclosure in response
to the requirements of Item 7(d)(2)(ii)(G) of Schedule 14(A) in
its definitive proxy statement, or this Item.
ITEM 11. CONTROLS AND PROCEDURES.
(a) Disclose the conclusions of the registrant's principal executive officer or
officers and principal financial officer or officers, or persons performing
similar functions, about the effectiveness of the registrant's disclosure
controls and procedures (as defined in Rule 30a-2(c) under the Act (17 CFR
270.30a-2(c))) based on their evaluation of these controls and procedures as of
a date within 90 days of the filing date of the report that includes the
disclosure required by this paragraph.
The registrant's principal executive officer
and principal financial officer have
concluded that the registrant's disclosure
controls and procedures are effective based
on their evaluation of these controls and
procedures as of a date within 90 days of the
filing date of this report.
(b) Disclose whether or not there were significant changes in the registrant's
internal controls or in other factors that could significantly affect these
controls subsequent to the date of their evaluation, including any corrective
actions with regard to significant deficiencies and material weaknesses.
There were no significant changes in the
registrant's internal control over financial
reporting that occurred during the second
fiscal quarter of the period covered by this
report that have materially affected, or are
reasonably likely to materially affect, the
registrant's internal control over financial
reporting.
The registrant's principal executive officer and principal financial
officer, however, voluntarily are reporting the following information:
In August of 2006 the registrant's investment adviser
enhanced its internal procedures for reporting performance
information required to be included in prospectuses.
Those enhancements involved additional internal controls
over the appropriateness of performance data
generated for this purpose. Such enhancements were made
following an internal review which identified
prospectuses relating to certain classes of shares of
a limited number of registrants where, inadvertently,
performance information not reflecting the deduction of
applicable sales charges was included. Those prospectuses
were revised, and the revised prospectuses were distributed to
shareholders.
ITEM 12. EXHIBITS.
File the exhibits listed below as part of this Form. Letter or number the
exhibits in the sequence indicated.
(a) Any code of ethics, or amendment thereto, that is the subject of the
disclosure required by Item 2, to the extent that the registrant intends to
satisfy the Item 2 requirements through filing of an exhibit.
(b) A separate certification for each principal executive officer and principal
financial officer of the registrant as required by Rule 30a-2 under the Act
(17 CFR 270.30a-2).
Filed herewith.
SIGNATURES
[See General Instruction F]
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) Pioneer Real Estate Shares
By (Signature and Title)* /s/ John F. Cogan, Jr.
John F. Cogan, Jr, President
Date August 29, 2008
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/ John F. Cogan, Jr.
John F. Cogan, Jr., President
Date August 29, 2008
By (Signature and Title)* /s/ Mark Bradley
Mark Bradley, Treasurer
Date August 29, 2008
* Print the name and title of each signing officer under his or her signature.