nvq
 
 
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM N-Q
QUARTERLY SCHEDULE OF PORTFOLIO HOLDINGS OF REGISTERED MANAGEMENT INVESTMENT COMPANY
Investment Company Act file number       811-10491      
Nuveen Real Estate Income Fund
(Exact name of registrant as specified in charter)
     333 West Wacker Drive, Chicago, Illinois 60606     
(Address of principal executive offices) (Zip code)
Kevin J. McCarthy—Vice President and Secretary
     333 West Wacker Drive, Chicago, Illinois 60606     
(Name and address of agent for service)
Registrant’s telephone number, including area code:      312-917-7700     
Date of fiscal year end:        12/31      
Date of reporting period:    9/30/2010   
Form N-Q is to be used by management investment companies, other than small business investment companies registered on Form N-5 (§§ 239.24 and 274.5 of this chapter), to file reports with the Commission, not later than 60 days after the close of the first and third fiscal quarters, pursuant to rule 30b1-5 under the Investment Company Act of 1940 (17 CFR 270.30b1-5). The Commission may use the information provided on Form N-Q in its regulatory, disclosure review, inspection, and policymaking roles.
A registrant is required to disclose the information specified by Form N-Q, and the Commission will make this information public. A registrant is not required to respond to the collection of information contained in Form N-Q 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 the 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. § 3507.
 
 

 

 

Item 1. Schedule of Investment
Portfolio of Investments (Unaudited)
Nuveen Real Estate Income Fund (JRS)
September 30, 2010
                                                   
Shares     Description (1)                                   Value  
 
       
 
                                        
        Real Estate Investment Trust Common Stocks - 78.1% (62.0% of Total Investments)
       
 
                                        
        Diversified – 1.7%
       
 
                                        
  53,281    
Vornado Realty Trust
                                   $ 4,557,125  
 
       
 
                                        
        Industrial – 6.7%
       
 
                                        
  426,100    
AMB Property Corp.
                                     11,278,867  
  562,700    
ProLogis
                                     6,628,606  
 
       
Total Industrial
                                    17,907,473  
         
       
 
                                        
        Office – 16.1%
       
 
                                        
  136,650    
Boston Properties, Inc.
                                     11,358,348  
  374,900    
Brandywine Realty Trust
                                     4,592,525  
  194,900    
HRPT Properties Trust
                                     4,989,440  
  145,000    
Corporate Office Properties
                                     5,409,950  
  259,900    
Douglas Emmett Inc.
                                     4,550,849  
  200,350    
Mack-Cali Realty Corporation
                                     6,553,449  
  87,600    
SL Green Realty Corporation
                                     5,547,708  
 
       
Total Office
                                    43,002,269  
         
       
 
                                        
        Residential – 15.8%
       
 
                                        
  404,300    
Apartment Investment & Management Company, Class A
                     8,643,934  
  65,638    
AvalonBay Communities, Inc.
                                     6,821,757  
  337,000    
Equity Residential
                                     16,031,090  
  99,500    
Essex Property Trust Inc.
                                     10,889,280  
 
       
Total Residential
                                    42,386,061  
         
       
 
                                        
        Retail – 15.7%
       
 
                                        
  54,150    
Federal Realty Investment Trust
                                     4,421,889  
  165,827    
Macerich Company
                                     7,122,270  
  189,950    
Regency Centers Corporation
                                     7,497,327  
  185,369    
Simon Property Group, Inc.
                                     17,191,121  
  128,850    
Taubman Centers Inc.
                                     5,747,999  
 
       
Total Retail
                                    41,980,606  
         
       
 
                                        
        Specialized – 22.1%
       
 
                                        
  424,250    
Health Care Property Investors Inc.
                                     15,264,515  
  721,475    
Host Hotels & Resorts Inc.
                                     10,446,958  
  178,700    
Public Storage, Inc.
                                     17,341,044  
  239,900    
Senior Housing Properties Trust
                                     5,637,650  
  364,750    
Sunstone Hotel Investors Inc., (2)
                                     3,308,283  
  134,550    
Ventas Inc.
                                     6,938,744  
 
       
Total Specialized
                                    58,937,194  
         
        Total Real Estate Investment Trust Common Stocks (cost $160,616,470)     208,770,728  
         
       
 
                                        
Shares    
Description (1)
           Coupon           Ratings (3)     Value  
 
       
 
                                        
        Convertible Preferred Securities – 2.8% (2.3% of Total Investments)
       
 
                                        
        Office – 2.8%
       
 
                                        
  340,756    
HRPT Properties Trust, Preferred Convertible Bonds
     6.500 %             Baa3     $ 7,571,598  
 
        Total Convertible Preferred Securities (cost $6,642,673)     7,571,598  
         
       
 
                                        
Shares    
Description (1)
           Coupon                 Value  
 
       
 
                                        
        Real Estate Investment Trust Preferred Stocks – 31.4% (25.1% of Total Investments)
       
 
                                        
        Diversified – 1.1%
       
 
                                        
  111,400    
PS Business Parks, Inc., Series O
             7.375 %                   $ 2,879,689  
 
       
 
                                        
        Office – 12.5%
       
 
                                        
  34,951    
HRPT Properties Trust, Series B
             9.875 %                     886,008  
  181,000    
HRPT Properties Trust, Series C
             7.125 %                     4,472,510  
  12,141    
Highwoods Properties, Inc., Series A
             8.625 %                     12,159,212  
  335,978    
Lexington Realty Trust
             7.550 %                     7,935,800  
  314,000    
Parkway Properties, Inc.
             8.000 %                     8,007,000  
 
       
Total Office
                                    33,460,530  
         
       
 
                                        
        Residential – 6.5%
       
 
                                        
  511,100    
Apartment Investment & Management Company, Series U
   7.750 %                     12,966,607  
  179,300    
Apartment Investment & Management Company, Series Y
   7.875 %                     4,575,736  
 
       
Total Residential
                                    17,542,343  
         
       
 
                                        
        Retail – 2.3%
       
 
                                        
  5,842    
CBL & Associates Properties Inc., Series C
             7.750 %                     143,129  
  21,151    
CBL & Associates Properties Inc., Series D
             7.375 %                     504,240  
  70,550    
Glimcher Realty Trust, Series G
             8.125 %                     1,724,948  
  152,800    
Saul Centers, Inc.
             8.000 %                     3,888,760  
 
       
Total Retail
                                    6,261,077  
         
       
 
                                        
        Specialized – 9.0%
       
 
                                        
  103,300    
Hersha Hospitality Trust, Series A
             8.000 %                     2,530,850  
  611,000    
Hospitality Properties Trust, Series C
             7.000 %                     15,042,820  
  271,452    
Sunstone Hotel Investors Inc., Series A
             8.000 %                     6,666,861  
 
       
Total Specialized
                                     24,240,531  
         
        Total Real Estate Investment Trust Preferred Stocks (cost $82,182,654)     84,384,170  
         
       
 
                                        
Principal    
 
                                        
    Amount (000)    
Description (1)
           Coupon   Maturity     Ratings (3)     Value  
 
       
 
                                        
        Convertible Bonds – 9.6% (7.7% of Total Investments)
       
 
                                        
        Industrial – 2.3%
       
 
                                        
$ 6,300    
Prologis Trust, Convertible Bonds
             2.250 %     4/01/37       BBB-     $ 6,126,750  
 
       
 
                                        
        Office – 4.0%
       
 
                                        
  7,750    
Alexandria Real Estate Equities Inc., Convertible Bonds, 144A
   3.700 %     1/15/27       N/R       7,643,438  
  2,000    
Kilroy Realty Limited Partnership, Convertible Bond, 144A
   3.250 %     4/15/12       N/R       1,995,000  
  1,200    
SL Green Realty Corporation, Convertible Bond, 144A
   3.000 %     3/30/27       N/R       1,170,000  
 
  10,950    
Total Office
                                    10,808,438  
 
       
 
                                        
        Retail – 3.3%
       
 
                                        
  9,000    
Macerich Company, Convertible Bond, 144A
             3.250 %     3/15/12       N/R       8,966,250  
 
$ 26,250    
Total Convertible Bonds (cost $23,871,237)
                                 25,901,438  
 
       
 
                                        
Principal    
 
                                        
  Amount (000)    
Description (1)
           Coupon   Maturity             Value  
 
       
 
                                        
        Short-Term Investments – 3.6% (2.9% of Total Investments)
       
 
                                        
$ 9,734    
Repurchase Agreement with Fixed Income Clearing Corporation, dated 9/30/10, repurchase price $9,734,323, collateralized by $9,215,000 U.S. Treasury Notes, 3.125%, due 5/15/19, value $9,929,163
           0.080 %     10/01/10             $ 9,734,301  
   
        Total Short-Term Investments (cost $9,734,301)     9,734,301  
         
        Total Investments (cost $283,047,335) – 125.5%     336,362,235  
         
        Borrowings – (24.1)% (4)(5)     (64,710,000 )
         
        Other Assets Less Liabilities – (1.4)%     (3,560,812 )
         
        Net Assets Applicable to Common Shares – 100%   $ 268,091,423  
         
Fair Value Measurements
In determining the fair value of the Fund’s investments, various inputs are used. These inputs are summarized in the three broad levels listed below:
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 management’s assumptions in determining the fair value of investments).
The inputs or methodologies used for valuing securities are not an indication of the risk associated with investing in those securities. The following is a summary of the Fund’s fair value measurements as of September 30, 2010:
                                 
    Level 1     Level 2     Level 3     Total  
 
 
                                
Investments:
                                
Real Estate Investment Trust Common Stocks
   $ 208,770,728     $ —     $ —     $ 208,770,728  
Preferred Securities*
     7,571,598       —       —       7,571,598  
Real Estate Investment Trust Preferred Stocks
     72,224,958       12,159,212       —       84,384,170  
Convertible Bonds
     —       25,901,438       —       25,901,438  
Short-Term Investments
     9,734,301       —       —       9,734,301  
 
 
                                
Total
   $ 298,301,585     $ 38,060,650     $ —     $ 336,362,235  
 
* Preferred Securities includes Convertible Preferred Securities, $25 par (or similar) Preferred Securities and Capital Preferred Securities held by the Fund at the end of the reporting period, if any.
Income Tax Information
The following information is presented on an income tax basis. Differences between amounts for financial statement and federal income tax purposes are primarily due to timing differences in recognizing certain gains and losses on investment transactions. To the extent that differences arise that are permanent in nature, such amounts are reclassified within the capital accounts on the Statement of Assets and Liabilities presented in the annual report, based on their federal tax basis treatment; temporary differences do not require reclassification. Temporary and permanent differences do not impact the net asset value of the Fund.
At September 30, 2010, the cost of investments was $286,833,397.
Gross unrealized appreciation and gross unrealized depreciation of investments at September 30, 2010, were as follows:
         
 
 
        
Gross unrealized:
        
Appreciation
   $ 54,793,483  
Depreciation
     (5,264,645 )
 
 
        
Net unrealized appreciation (depreciation) of investments
   $ 49,528,838  
 
For Fund portfolio compliance purposes, the Fund’s industry classifications refer to any one or more of the industry sub-classifications used by one or more widely recognized market indexes or ratings group indexes, as/or as defined by Fund management. This definition may not apply for purposes of this report, which may combine industry sub-classifications into sectors for reporting ease.
     
(1)
  All percentages shown in the Portfolio of Investments are based on net assets applicable to Common shares unless otherwise noted.
 
    
(2)
  Non-income producing; issuer has not declared a dividend within the past twelve months.
 
    
(3)
  Ratings: Using the highest of Standard & Poor’s Group (“Standard & Poor’s”), Moody’s Investor Service, Inc. (“Moody’s”) or Fitch, Inc. (“Fitch”) rating. Ratings below BBB by Standard & Poor’s, Baa by Moody’s or BBB by Fitch are considered to be below investment grade. Holdings designated N/R are not rated by any of these national rating agencies.
 
    
(4)
  Borrowings Payable as a percentage of total investments is 19.2%.
 
    
(5)
  The Fund may pledge up to 100% of its eligible investments in the Portfolio of Investments as collateral for Borrowings. As of September 30, 2010, investments with a value of $138,895,784 have been pledged as collateral for Borrowings.
 
    
N/R
  Not rated.
 
    
144A
  Investment is exempt from registration under Rule 144A of the Securities Act of 1933, as amended. These investments may only be resold in transactions exempt from registration, which are normally those transactions with qualified institutional buyers.

 

Item 2. Controls and Procedures.
  a.   The registrant’s principal executive and principal financial officers, or persons performing similar functions, have concluded that the registrant’s disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940, as amended (the “1940 Act”) (17 CFR 270.30a-3(c))) are effective, as of a date within 90 days of the filing date of this report that includes the disclosure required by this paragraph, based on their evaluation of the controls and procedures required by Rule 30a-3(b) under the 1940 Act (17 CFR 270.30a-3(b)) and Rule 13a-15(b) or 15d-15(b) under the Securities Exchange Act of 1934 (17 CFR 240.13a-15(b) or 240.15d-15(b)).
 
  b.   There were no changes in the registrant’s internal control over financial reporting (as defined in Rule 30a-3(d) under the 1940 Act (17 CFR 270.30a-3(d)) that occurred during the registrant’s last fiscal quarter that have materially affected, or are reasonably likely to materially affect, the registrant’s internal control over financial reporting.
Item 3. Exhibits.
File as exhibits as part of this Form a separate certification for each principal executive officer and principal financial officer of the registrant as required by Rule 30a-2(a) under the 1940 Act (17 CFR 270.30a-2(a)), exactly as set forth below: EX-99 CERT Attached hereto.

 

 

SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
(Registrant) Nuveen Real Estate Income Fund
         
     
By (Signature and Title)  /s/ Kevin J. McCarthy    
  Kevin J. McCarthy  
  Vice President and Secretary   
 
Date November 29, 2010
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/ Gifford R. Zimmerman    
  Gifford R. Zimmerman   
  Chief Administrative Officer (principal executive officer)   
 
Date November 29, 2010
         
     
By (Signature and Title)  /s/ Stephen D. Foy    
  Stephen D. Foy   
  Vice President and Controller (principal financial officer)   
 
Date November 29, 2010