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:    3/31/2011   

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 Investments

Portfolio of Investments

Nuveen Real Estate Income Fund (JRS)
March 31, 2011(Unaudited)

Shares				Description (1)														Value
				Real Estate Investment Trust Common Stocks – 80.9% (63.3% of Total Investments)
				Diversified – 3.8%
	257,500			Colonial Properties Trust														$	4,956,875
	185,300			Liberty Property Trust															6,096,370
				Total Diversified															11,053,245
				Industrial – 8.4%
	404,550			AMB Property Corp.															14,551,664
	612,500			ProLogis															9,787,750
				Total Industrial															24,339,414
				Office – 15.5%
	273,130			BioMed Realty Trust Inc.															5,194,933
	136,700			Boston Properties, Inc.															12,965,995
	206,250			Common Wealth REIT															5,356,313
	249,200			Mack-Cali Realty Corporation															8,447,880
	126,800			Piedmont Office Realty Trust															2,461,188
	138,900			SL Green Realty Corporation															10,445,280
				Total Office															44,871,589
				Residential – 15.3%
	296,700			Apartment Investment & Management Company, Class A															7,556,949
	69,438			AvalonBay Communities, Inc.															8,338,115
	356,650			Equity Residential															20,118,626
	67,700			Essex Property Trust Inc.															8,394,800
				Total Residential															44,408,490
				Retail – 13.5%
	57,300			Federal Realty Investment Trust															4,673,388
	387,929			General Growth Properties Inc.															6,005,141
	138,177			Macerich Company															6,843,907
	201,050			Regency Centers Corporation															8,741,654
	120,819			Simon Property Group, Inc.															12,946,964
				Total Retail															39,211,054
				Specialized – 24.4%
	242,300			Extra Space Storage Inc.															5,018,033
	489,050			HCP, Inc.															18,554,556
	212,150			Health Care REIT, Inc.															11,125,146
	930,125			Host Hotels & Resorts Inc.															16,379,501
	108,150			Public Storage, Inc.															11,994,917
	142,450			Ventas Inc.															7,735,035
				Total Specialized															70,807,188
				Total Real Estate Investment Trust Common Stocks (cost $169,746,992)															234,690,980
Shares				Description (1)		Coupon								Ratings (2)				Value
				Convertible Preferred Securities – 2.5% (2.0% of Total Investments)
				Office – 2.5%
	340,756			Common Wealth REIT, Preferred Convertible Bonds			6.500	%						Baa3				$	7,333,069
				Total Convertible Preferred Securities (cost $6,642,673)															7,333,069
Shares				Description (1)		Coupon												Value
				Real Estate Investment Trust Preferred Stocks – 39.4% (30.8% of Total Investments)
				Diversified – 1.1%
	131,400			PS Business Parks, Inc., Series O			7.375	%										$	3,304,710
				Office – 19.2%
	181,000			Common Wealth REIT			7.125	%											4,546,720
	12,141			Highwoods Properties, Inc., Series A			8.625	%											12,937,753
	293,000			Hudson Pacific Properties Inc.			8.375	%											7,412,900
	335,978			Lexington Realty Trust			7.550	%											7,935,800
	314,000			Parkway Properties, Inc.			8.000	%											7,790,340
	600,000			SL Green Realty Corporation			7.625	%											15,036,000
				Total Office															55,659,513
				Residential – 7.3%
	511,100			Apartment Investment & Management Company, Series U			7.750	%											12,762,167
	179,300			Apartment Investment & Management Company, Series Y			7.875	%											4,491,465
	160,000			Equity Lifestyle Properties Inc.			8.034	%											3,966,400
				Total Residential															21,220,032
				Retail – 3.1%
	37,842			CBL & Associates Properties Inc.			7.750	%											942,266
	102,000			CBL & Associates Properties Inc.			7.375	%											2,480,640
	70,550			Glimcher Realty Trust, Series G			8.125	%											1,759,517
	152,800			Saul Centers, Inc.			8.000	%											3,896,400
				Total Retail															9,078,823
				Specialized – 8.7%
	38,000			Health Care REIT, Inc.			7.875	%											963,300
	103,300			Hersha Hospitality Trust, Series A			8.000	%											2,565,972
	611,000			Hospitality Properties Trust, Series C			7.000	%											14,877,851
	271,452			Sunstone Hotel Investors Inc., Series A			8.000	%											6,707,578
				Total Specialized															25,114,701
				Total Real Estate Investment Trust Preferred Stocks (cost $111,564,405)															114,377,779
Principal
Amount (000)				Description (1)		Coupon				Maturity				Ratings (2)				Value
				Convertible Bonds – 2.2% (1.7% of Total Investments)
				Industrial – 2.2%
$	6,300			Prologis Trust, Convertible Bonds			2.250	%			4/01/37			BBB-				$	6,284,250
$	6,300			Total Convertible Bonds (cost $5,914,806)															6,284,250
Principal
Amount (000)				Description (1)		Coupon				Maturity								Value
				Short-Term Investments – 2.8% (2.2% of Total Investments)
$	8,131			Repurchase Agreement with Fixed Income Clearing Corporation, dated 3/31/11, repurchase price $8,130,979, collateralized by $7,665,000 U.S. Treasury Notes, 4.250%, due 8/15/13, value $8,297,363			0.010	%			4/01/11							$	8,130,977
				Total Short-Term Investments (cost $8,130,977)															8,130,977
				Total Investments (cost $301,999,853) – 127.8%															370,817,055
				Borrowings – (28.6)% (3), (4)															(82,910,000	)
				Other Assets Less Liabilities – 0.8%															2,192,220
				Net Assets Applicable to Common Shares – 100%														$	290,099,275

Investment in Derivatives

Interest Rate Swaps outstanding at March 31, 2011:

Fund

Fixed Rate

Unrealized Appreciation

Notional

Pay/Receive

Floating Rate

Payment

Termination

Value

(Depreciation)

Counterparty

Amount

Floating Rate

Index

Fixed Rate*

Frequency

Date

(U.S. Dollars)

(U.S. Dollars)

JPMorgan Chase

$

20,727,500

Receive

1-Month USD-LIBOR

1.412

%

Monthly

3/29/14

$

17,000

$

17,000

Morgan Stanley

20,727,500

Receive

1-Month USD-LIBOR

0.409

Monthly

3/29/12

(6,046

)

(6,046

)

Morgan Stanley

20,727,500

Receive

1-Month USD-LIBOR

2.323

Monthly

3/29/16

21,924

21,924

$

32,878

*    Annualized

Fair Value Measurements

Fair value is defined as the price that the Fund would receive upon selling an investment or transferring a liability in an orderly transaction to an independent buyer in the principal or most advantageous market of the investment. A three-tier hierarchy is used to maximize the use of observable market data and minimize the use of unobservable inputs and to establish classification of fair value measurements for disclosure purposes. Observable inputs reflect the assumptions market participants would use in pricing the asset or liability. Observable inputs are based on market data obtained from sources independent of the reporting entity. Unobservable inputs reflect the reporting entity’s own assumptions about the assumptions market participants would use in pricing the asset or liability. Unobservable inputs are based on the best information available in the circumstances. The three-tier hierarchy of inputs is 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 March 31, 2011:

		Level 1				Level 2				Level 3				Total
Investments:
Real Estate Investment Trust Common Stocks		$	234,690,980			$	—			$	—			$	234,690,980
Convertible Preferred Securities			7,333,069				—				—				7,333,069
Real Estate Investment Trust Preferred Stocks			101,440,026				12,937,753				—				114,377,779
Convertible Bonds			—				6,284,250				—				6,284,250
Short-Term Investments			—				8,130,977				—				8,130,977
Derivatives:
Interest Rate Swaps*			—				32,878				—				32,878
		$	343,464,075			$	27,385,858			$	—			$	370,849,933

* Represents net unrealized appreciation (depreciation).

During the period ended March 31, 2011, the Fund recognized no significant transfers to/from Level 1, Level 2 or Level 3.

Derivative Instruments and Hedging Activities

The Fund records derivative instruments at fair value, with changes in fair value recognized on the Statement of Operations, when applicable. Even though the Fund’s investments in derivatives may represent economic hedges, they are not considered to be hedge transactions for financial reporting purposes.

The table below presents the fair value of all derivative instruments held by the Fund as of March 31, 2011, the location of these instruments on the Statement of Assets and Liablilities, and the primary underlying risk exposure.

Location on the Statements of Assets Liabilities

Underlying

Derivative

Asset Derivatives

Liability Derivatives

Risk Exposure

Instrument

Location

Value

Location

Value

Interest Rate

Swaps

Unrealized appreciation on interest rate swaps*

$

32,878

Unrealized depreciation on interest rate swaps*

$ —

*		Represents cumulative appreciation (depreciation) of swap contracts as reported in the Portfolio of Investments. Some swap contracts require a counterparty to pay or receive a premium, which is disclosed on the Statement of Assets and Liabilities but is not reflected in the cumulative appreciation (depreciation) presented above.

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 March 31, 2011, the cost of investments (excluding investments in derivatives) was $304,980,642.

Gross unrealized appreciation and gross unrealized depreciation of investments (excluding investments in derivatives) at March 31, 2011, were as follows:

Gross unrealized:
Appreciation		$	70,043,540
Depreciation			(4,207,127	)
Net unrealized appreciation (depreciation) of investments		$	65,836,413

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, and/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)		Ratings (not covered by the report of independent registered public accounting firm): 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.
(3)		Borrowings Payable as a percentage of Total Investments is 22.4%.
(4)		The Fund may pledge up to 100% of its eligible investments in the Portfolio of Investments as collateral for Borrowings. As of March 31, 2011, investments with a value of $177,944,642 have been pledged as collateral for Borrowings.
USD-LIBOR		United States Dollar-London Inter-Bank Offered Rate.

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

Date May 27, 2011

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.

Date May 27, 2011

Date May 27, 2011