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 811-10491
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Nuveen Real Estate Income Fund
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(Exact name of registrant as specified in charter)
Nuveen Investments
333 West Wacker Drive
Chicago, IL 60606
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(Address of principal executive offices) (Zip code)
Jessica R. Droeger
Nuveen Investments
333 West Wacker Drive
Chicago, IL 60606
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(Name and address of agent for service)
Registrant's telephone number, including area code: (312) 917-7700
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Date of fiscal year end: December 31
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Date of reporting period: March 31, 2006
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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 STOCKHOLDERS.
QUARTERLY REPORT March 31, 2006
(Unaudited)
Nuveen Investments
Exchange-Traded
Closed-End
Funds
NUVEEN
REAL ESTATE
INCOME FUND
JRS
HIGH CURRENT INCOME FROM A PORTFOLIO OF COMMERCIAL REAL ESTATE INVESTMENTS
Chairman's Letter
For period ended March 31, 2006
Dear Shareholder:
I am very pleased to report that over the 3-month period covered by this report,
your Fund continued to provide you with attractive monthly income from a
diversified portfolio of quality real estate securities. For more information on
your Fund's performance, please read the Portfolio Managers' Comments, the
Distribution and Share Price Information, and the Performance Overview sections
of this report.
Portfolio diversification is a recognized way to try to reduce some of the risk
that comes with investing. Since one part of your portfolio may be going up when
another is going down, portfolio diversification may help smooth your investment
returns over time. In addition to providing regular monthly income, an
investment like your Fund may help you achieve and benefit from greater
portfolio diversification. Your financial advisor can explain these potential
advantages in more detail. I urge you to contact him or her soon for more
information on this important investment strategy.
At Nuveen Investments, our mission continues to be to assist you and your
financial advisor by offering investment services and products that can help you
to secure your financial objectives. We are grateful that you have chosen us as
a partner as you pursue your financial goals, and we look forward to continuing
to earn your trust in the months and years ahead.
Sincerely,
/s/ Timothy R. Schwertfeger
TIMOTHY R. SCHWERTFEGER
Chairman of the Board
May 3, 2006
Callout:
"In addition to providing regular monthly income, an investment like your Fund
may help you achieve and benefit from greater portfolio diversification."
Portfolio Manager's Comments
The Nuveen Real Estate Income Fund is managed by a team of real estate
investment professionals at Security Capital Research & Management Incorporated,
a wholly-owned subsidiary of J. P. Morgan Chase & Co. Anthony R. Manno Jr. and
Kenneth D. Statz, who each have more than 23 years' experience in managing real
estate investments, lead the team. Here they review the economic environment and
performance of the Fund.
WHAT WAS YOUR OVERALL MANAGEMENT STRATEGY FOR THE THREE-MONTH PERIOD ENDED
MARCH 31, 2006?
During the quarter, we continued to focus on those securities that we believed
were best positioned to generate sustainable income and potential price
appreciation over the long-run. In managing the JRS portfolio, we sought to
maintain significant diversification while taking into account company credit
quality, sector and geographic exposure and security-type allocations. Every
investment decision was based on a multi-layered analysis of the company, the
real estate it owns, its management, and the relative price of the security.
The ability to shift allocations between preferred and common stocks based on
the relative attractiveness of these two distinct markets is an important tool
in managing JRS for income and long-term capital appreciation. In 2004, an
environment characterized by rising interest rates indicated a shift in the risk
and reward characteristics of common stocks versus preferred stocks, and as a
result we significantly tilted the portfolio toward common stocks, especially
those of companies exhibiting the greatest potential in an improving economy. In
the first quarter of 2006, we maintained the portfolio's tilt toward common. The
portfolio continues to emphasize companies and property types with a cyclical
orientation associated with shorter lease terms and favor the strongest infill
markets and locations where we feel there is value enhancement potential and a
real inflation hedge over the long term.
As of March 31, 2006, the portfolio allocations were 70.3% common stocks, 27.6%
preferred stocks, of which 2.6% was in convertible preferred securities, and
2.1% short-term investments.
HOW DID THE FUND PERFORM?
Fund performance results, as well as the performance of two real estate indexes,
are shown in the accompanying table:
Total Return on Net Asset Value*
For the 3-month period ended March 31, 2006
JRS 11.78%
Comparative benchmark(1) 9.41%
Dow Jones Wilshire Real Estate Securities Index(2) 15.42%
*Three-month returns are cumulative
Past performance does not guarantee future results. Current performance may be
higher or lower than the data shown.
Returns do not reflect the deduction of taxes that a shareholder may have to pay
on Fund distributions or upon the sale of Fund shares.
See the Performance Overview Page for additional information.
---------
(1) The comparative benchmark return is a market capitalization weighted
benchmark using the preferred stock, convertible securities and the top 50% of
common stock based on yield securities of in the SNL Financial LC real estate
database.
(2) The Dow Jones Wilshire Real Estate Securities Index is an unmanaged index
comprised of common shares of publicly-traded REITs and other real estate
operating companies
Since 2003, we have been gradually and selectively shifting the portfolio's
property type weightings from a largely defensive posture to one better
positioned with respect to a growing economy, while at all times remaining
highly focused on the current income objectives of the fund. For the past year
we have pursued this strategy by increasing the portfolio's allocation toward
more cyclically sensitive multifamily companies as well as mall companies. This
research-based theme was rewarded, as our specific selections within the
multifamily and mall sectors substantially outperformed their respective sector
components of the Specialized Real Estate Benchmark. We also actively researched
a growing number of IPO's in the past 12 months and have selectively invested in
those we believe will thrive in the public arena.
1
In seeking to maintain the income objective of the Fund, our investments in the
higher yielding, but historically defensive Health Care sector underperformed
the Benchmark as a whole.
It is important to note that investing in preferred stock remains an important
component of the income and appreciation strategy of JRS as well as the Fund's
Specialized Real Estate Securities Benchmark. However, preferred securities are
not included in broader real estate securities indices, like the Dow Jones
Wilshire Real Estate Securities Index (WARESI). Though we have substantially
reduced JRS's allocation to preferred stocks, they remained a significant
allocation in the Fund's portfolio over the year. While we believe it helped the
Fund's overall risk profile, it did create a drag on performance when compared
to an all common stock index like the WARESI.
Distribution and Share Price Information
In addition to owning preferred stocks, the Fund has issued its own preferred
shares, called Taxable Auctioned Preferred Shares(TM). This provides a degree of
financial leverage that can increase share price volatility, but also can
enhance Fund returns and supplement the income available to pay common
shareholder distributions. This leveraging strategy provided incremental income
and helped enhance shareholder distributions over the 3-month period.
The Fund has a managed distribution policy designed to provide relatively stable
monthly cash flow to investors. Under this policy, the Fund's monthly
distributions will be paid from net investment income generated by its
underlying securities as well as from net realized capital gains and/or returns
of capital, generally representing unrealized capital gains. The Fund declared a
monthly distribution increase in March to $0.1550 per share.
As of March 31, 2006, the Fund was trading at a -7.57% discount to its net asset
value, compared with an average discount of -8.79% for the entire three-month
period.
Nuveen Real Estate Income Fund
JRS
Performance
OVERVIEW As of March 31, 2006
PORTFOLIO ALLOCATION
(as a % of total investments)
Common Stocks 70.3%
Preferred Stocks 27.6%
Short-Term Investments 2.1%
Bar Chart:
2005-2006 MONTHLY DISTRIBUTIONS PER SHARE
Apr 0.1350
May 0.1350
Jun 0.1350
Jul 0.1350
Aug 0.1350
Sep 0.1450
Oct 0.1450
Nov 0.1450
Dec 0.1450
Jan 0.1450
Feb 0.1450
Mar 0.1550
Line Chart:
SHARE PRICE PERFORMANCE
Weekly Closing Price
Past Performance is not predictive of future results.
4/1/2005 18.25
4/8/2005 18.42
4/15/2005 18.44
4/22/2005 18.70
4/29/2005 19.40
5/6/2005 19.95
5/13/2005 19.92
5/20/2005 20.17
5/27/2005 19.60
6/3/2005 20.19
6/10/2005 20.17
6/17/2005 20.13
6/24/2005 20.11
7/1/2005 20.33
7/8/2005 20.69
7/15/2005 20.40
7/22/2005 20.66
7/29/2005 21.20
8/5/2005 20.18
8/12/2005 19.48
8/19/2005 19.02
8/26/2005 19.38
9/2/2005 19.88
9/9/2005 20.40
9/16/2005 20.29
9/23/2005 20.00
9/30/2005 20.35
10/7/2005 19.93
10/14/2005 19.31
10/21/2005 19.28
10/28/2005 19.85
11/4/2005 19.59
11/11/2005 19.64
11/18/2005 19.55
11/25/2005 19.88
12/2/2005 20.03
12/9/2005 19.82
12/16/2005 19.72
12/23/2005 19.80
12/30/2005 19.99
1/6/2006 20.74
1/13/2006 20.45
1/20/2006 20.65
1/27/2006 20.80
2/3/2006 20.97
2/10/2006 20.99
2/17/2006 21.70
2/24/2006 22.13
3/3/2006 22.43
3/10/2006 22.80
3/17/2006 23.15
3/24/2006 22.60
3/31/2006 22.70
FUND SNAPSHOT
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Common Share Price $22.70
------------------------------------
Common Share Net Asset Value $24.56
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Premium / (Discount) to NAV -7.57%
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Market Yield(1) 8.19%
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Net Assets Attributable to
Common Sharse ($000) $690,959
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AVERAGE ANNUAL TOTAL RETURN
(Inception 11/15/01)
------------------------------------
ON SHARE PRICE ON NAV
------------------------------------
3-Month
(Cumulative) 15.87% 11.78%
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1-Year 36.37% 31.20%
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Since Inception 19.34% 22.42%
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INDUSTRIES
(as a % of total investments)
------------------------------------
Office 25.6%
------------------------------------
Specialized 20.2%
------------------------------------
Retail 19.6%
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Residential 18.1%
------------------------------------
Diversified 11.3%
------------------------------------
Industrial 3.1%
------------------------------------
Short-Term Investments 2.1%
------------------------------------
TOP FIVE COMMON STOCK ISSUERS
(as a % of total investments)
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Macerich Company 6.1%
------------------------------------
Mack-Cali Realty
Corporation 6.0%
------------------------------------
Reckson Associates
Realty Corporation 5.9%
------------------------------------
AvalonBay Communities, Inc. 5.9%
------------------------------------
Archstone-Smith Trust 4.5%
------------------------------------
TOP FIVE PREFERRED STOCK ISSUERS
(as a % of total investments)
------------------------------------
Crescent Real Estate
Equities Company 5.1%
------------------------------------
Apartment Investment
& Management Company 3.8%
------------------------------------
Home Properties Inc. 2.8%
------------------------------------
LaSalle Hotel Properties 1.8%
------------------------------------
Maguire Properties, Inc. 1.6%
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1 Market yield is based on the Fund's current annualized monthly distribution
divided by the Fund's current market price. REIT distributions received by the
Fund are generally comprised of investment income, long-term and short-term
capital gains and a REIT return of capital. The Fund's monthly distributions to
its shareholders may be comprised of ordinary income, net realized capital
gains and, if at the end of the calendar year the Fund's cumulative net
ordinary income and net realized gains are less than the amount of the Fund's
distributions, a return of capital for tax purposes.
Nuveen Real Estate Income Fund (JRS)
PORTFOLIO OF INVESTMENTS March 31, 2006 (Unaudited)
Shares Description (1) Value
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Real Estate Investment Trust Common Stocks - 88.2% (70.3% of Total Investments)
Diversified - 5.3%
1,890,000 Newkirk Realty Trust Inc. $34,190,100
222,900 Spirit Finance Corporation 2,719,380
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Total Diversified 36,909,480
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Industrial - 4.0%
626,600 First Industrial Realty Trust, Inc. 26,749,554
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Office - 26.6%
477,300 Equity Office Properties Trust 16,027,734
3,059,400 HRPT Properties Trust 35,917,356
1,090,500 Mack-Cali Realty Corporation 52,344,000
264,600 Maguire Properties, Inc. 9,657,900
1,120,600 Reckson Associates Realty Corporation 51,345,892
1,579,000 Republic Property Trust 18,584,830
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Total Office 183,877,712
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Residential -14.4%
215,300 Apartment Investment & Management Company, Class A 10,097,570
795,000 Archstone-Smith Trust 38,772,150
464,500 AvalonBay Communities, Inc. 50,676,950
------------------------------------------------------------------------------------------------------------------------------------
Total Residential 99,546,670
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Retail - 19.2%
239,600 Cedar Shopping Centers Inc. 3,795,264
413,800 Federal Realty Investment Trust 31,117,760
775,400 Glimcher Realty Trust 22,021,360
711,000 Macerich Company 52,578,450
880,300 New Plan Excel Realty Trust 22,834,982
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Total Retail 132,347,816
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Specialized -18.7%
2,013,000 Ashford Hospitality Trust Inc. 24,961,200
493,400 Cogdell Spencer Inc. 10,519,288
931,564 Hersha Hospitality Trust 9,120,012
1,587,300 Nationwide Health Properties, Inc. 34,126,950
1,740,300 Senior Housing Properties Trust 31,499,430
984,200 U-Store-It Trust 19,831,630
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Total Specialized 130,058,510
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TOTAL REAL ESTATE INVESTMENT TRUST COMMON STOCKS (COST $373,871,032) 609,489,742
====================================================================================================================
12
Shares Description (1) Coupon Value
------------------------------------------------------------------------------------------------------------------------------------
Real Estate Investment Trust Preferred Stocks - 34.6% (27.6% of Total Investments)
Diversified - 8.9%
1,031,300 Crescent Real Estate Equities Company, Series A (Convertible) 6.750% 22,255,454
850,000 Crescent Real Estate Equities Company, Series B 9.500% 22,206,250
150,000 Lexington Corporate Properties Trust, Series B 8.050% 3,810,000
497,623 PS Business Parks, Inc., Series F 8.750% 12,619,719
------------------------------------------------------------------------------------------------------------------------------------
Total Diversified 60,891,423
--------------------------------------------------------------------------------------------------------------------
Office -5.5%
95,400 Alexandria Real Estate Equities Inc., Series B 9.100% 2,423,160
160,000 Alexandria Real Estate Equities Inc., Series C 8.375% 4,180,800
200,000 Corporate Office Properties Trust, Series G 8.000% 5,116,000
12,141 Highwoods Properties, Inc., Series A 8.625% 12,827,725
543,000 Maguire Properties, Inc., Series A 7.625% 13,634,730
------------------------------------------------------------------------------------------------------------------------------------
Total Office 38,182,415
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Residential - 8.2%
603,500 Apartment Investment & Management Company, Series R 10.000% 15,347,005
511,100 Apartment Investment & Management Company, Series U 7.750% 12,757,056
183,000 Apartment Investment & Management Company, Series Y 7.875% 4,589,640
945,000 Home Properties Inc., Series F 9.000% 24,286,500
------------------------------------------------------------------------------------------------------------------------------------
Total Residential 56,980,201
--------------------------------------------------------------------------------------------------------------------
Retail - 5.5%
160,000 Cedar Shopping Centers Inc., Series A 8.875% 4,290,000
113,000 Glimcher Realty Trust, Series F 8.750% 2,881,500
202,300 Glimcher Realty Trust, Series G 8.125% 5,118,190
115,200 Mills Corp, Series C 9.000% 2,632,320
442,000 Mills Corp, Series G 7.875% 9,414,600
125,000 Saul Centers, Inc., Series A 8.000% 3,287,500
400,000 Taubman Centers, Inc., Series H 7.625% 10,040,000
------------------------------------------------------------------------------------------------------------------------------------
Total Retail 37,664,110
--------------------------------------------------------------------------------------------------------------------
Specialized - 6.5%
130,000 Ashford Hospitality Trust, Series A 8.550% 3,315,000
339,000 Boykin Lodging Company, Series A 10.500% 8,890,275
407,900 FelCor Lodging Trust Inc., Series C, (2) 8.000% 10,205,658
120,000 Hersha Hospitality Trust, Series A 8.000% 2,995,200
592,000 LaSalle Hotel Properties, Series A 10.250% 15,226,240
175,000 Strategic Hotel Capital Inc., Series B 8.250% 4,467,978
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Total Specialized 45,100,351
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TOTAL REAL ESTATE INVESTMENT TRUST PREFERRED STOCKS (COST $232,756,347) 238,818,500
====================================================================================================================
Principal
Amount (000) Description (1) Coupon Maturity Value
------------------------------------------------------------------------------------------------------------------------------------
Short-Term Investments - 2.6% (2.1% of Total Investments)
Repurchase Agreement with State Street Bank, dated 3/31/06, repurchase
price $17,940,909, collateralized by $19,335,000
$17,935 U.S. Treasury Notes, 4.500% due 2/15/36, value $18,295,744 4.250% 4/03/06 17,934,557
================--------------------------------------------------------------------------------------------------------------------
TOTAL SHORT-TERM INVESTMENTS (COST $17,934,557) 17,934,557
====================================================================================================================
TOTAL INVESTMENTS (COST $624,561,936) - 125.4% 866,242,799
====================================================================================================================
OTHER ASSETS LESS LIABILITIES - (0.5)% (3,283,684)
====================================================================================================================
TAXABLE AUCTIONED PREFERRED SHARES, AT LIQUIDATION VALUE - (24.9)% (172,000,000)
====================================================================================================================
NET ASSETS APPLICABLE TO COMMON SHARES - 100% $ 690,959,115
====================================================================================================================
Interest Rate Swaps outstanding at March 31, 2006:
FIXED RATE
PAID FIXED RATE FLOATING RATE FLOATING RATE UNREALIZED
NOTIONAL BY THE FUND PAYMENT RECEIVED PAYMENT TERMINATION APPRECIATION
COUNTERPARTY AMOUNT (ANNUALIZED) FREQUENCY BY THE FUND(3) FREQUENCY DATE (DEPRECIATION)
----------------------------------------------------------------------------------------------------------------------------
Citigroup Inc. $43,000,000 4.800% Monthly 4.661% Monthly 2/06/07 $120,192
Citigroup Inc. 43,000,000 5.190 Monthly 4.661 Monthly 2/06/09 (86,560)
----------------------------------------------------------------------------------------------------------------------------
$ 33,632
============================================================================================================================
(1) All percentages shown in the Portfolio of Investments are based on net
assets applicable to Common shares unless otherwise noted.
(2) Security is eligible for the Dividends Received Deduction.
(3) Based on USD-LIBOR (United States Dollar-London Inter-Bank Offered
Rate).
See accompanying notes to financial statements.
13
Statement of
ASSETS AND LIABILITIES March 31, 2006 (Unaudited)
-------------------------------------------------------------------------------------------------------------------
ASSETS
Investments, at value (cost $624,561,936) $866,242,799
Cash 1,250,719
Unrealized appreciation on interest rate swaps 33,632
Dividends and interest receivable 5,043,464
Other assets 49,994
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Total assets 872,620,608
-------------------------------------------------------------------------------------------------------------------
LIABILITIES
Payable for investments purchased 8,980,809
Accrued expenses:
Management fees 419,437
Other 188,132
Taxable Auctioned Preferred share dividends payable 73,115
-------------------------------------------------------------------------------------------------------------------
Total liabilities 9,661,493
-------------------------------------------------------------------------------------------------------------------
Taxable Auctioned Preferred shares, at liquidation value 172,000,000
-------------------------------------------------------------------------------------------------------------------
Net assets applicable to Common shares $690,959,115
===================================================================================================================
Common shares outstanding 28,136,413
===================================================================================================================
Net asset value per Common share outstanding (net assets applicable to
Common shares, divided by Common shares outstanding) $ 24.56
===================================================================================================================
NET ASSETS APPLICABLE TO COMMON SHARES CONSIST OF:
-------------------------------------------------------------------------------------------------------------------
Common shares, $.01 par value per share $ 281,364
Paid-in surplus 391,118,113
Undistributed (Over-distribution of) net investment income 4,331,698
Accumulated net realized gain (loss) from investments and derivative transactions 53,513,445
Net unrealized appreciation (depreciation) of investments and derivative
transactions 241,714,495
-------------------------------------------------------------------------------------------------------------------
Net assets applicable to Common shares $690,959,115
-------------------------------------------------------------------------------------------------------------------
Authorized shares:
Common Unlimited
Table Auctioned Preferred Unlimited
===================================================================================================================
See accompanying notes to financial statements.
14
Statement of
OPERATIONS Three Months Ended March 31, 2006 (Unaudited)
------------------------------------------------------------------------------------------------------------------------------------
INVESTMENT INCOME
Dividends $ 6,786,591
Interest 138,574
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Total investment income 6,925,165
------------------------------------------------------------------------------------------------------------------------------------
EXPENSES
Management fees 1,814,126
Taxable Auctioned Preferred shares - auction fees 106,027
Taxable Auctioned Preferred shares - dividend disbursing agent fees 5,794
Shareholders' servicing agent fees and expenses 1,528
Custodian's fees and expenses 38,062
Trustees' fees and expenses 6,008
Professional fees 11,786
Shareholders' reports - printing and mailing expenses 25,949
Stock exchange listing fees 590
Investor relations expense 28,945
Other expenses 9,514
------------------------------------------------------------------------------------------------------------------------------------
Total expenses before expense reimbursement 2,048,329
Expense reimbursement (619,273)
------------------------------------------------------------------------------------------------------------------------------------
Net expenses 1,429,056
------------------------------------------------------------------------------------------------------------------------------------
Net investment income 5,496,109
------------------------------------------------------------------------------------------------------------------------------------
REALIZED AND UNREALIZED GAIN (LOSS)
Net realized gain (loss) from:
Investments 53,635,897
Interest rate swaps (122,453)
Change in net unrealized appreciation (depreciation) of:
Investments 15,905,097
Interest rate swaps 685,889
------------------------------------------------------------------------------------------------------------------------------------
Net realized and unrealized gain (loss) 70,104,430
------------------------------------------------------------------------------------------------------------------------------------
DISTRIBUTIONS TO TAXABLE AUCTIONED PREFERRED SHAREHOLDERS
From net investment income (1,769,644)
From accumulated net realized gains --
------------------------------------------------------------------------------------------------------------------------------------
Decrease in net assets applicable to Common shares from
distributions to Taxable Auctioned Preferred shareholders (1,769,644)
------------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets applicable to Common shares
from operations $ 73,830,895
====================================================================================================================================
See accompanying notes to financial statements.
15
Statement of
CHANGES IN NET ASSETS (Unaudited)
THREE MONTHS ENDED YEAR ENDED
3/31/06 12/31/05
----------------------------------------------------------------------------------------------------------------------------------
OPERATIONS
Net investment income $ 5,496,109 $ 23,684,837
Net realized gain (loss) from:
Investments 53,635,897 43,150,661
Interest rate swaps (122,453) (1,739,276)
Change in net unrealized appreciation (depreciation) of:
Investments 15,905,097 (18,591,745)
Interest rate swaps 685,889 3,221,965
Distributions to Taxable Auctioned Preferred shareholders:
From net investment income (1,769,644) (976,242)
From accumulated net realized gains -- (4,466,723)
----------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets
applicable to Common shares
from operations 73,830,895 44,283,477
----------------------------------------------------------------------------------------------------------------------------------
DISTRIBUTIONS TO COMMON SHAREHOLDERS
From net investment income (12,520,704) (8,022,508)
From accumulated net realized gains -- (38,683,938)
----------------------------------------------------------------------------------------------------------------------------------
Decrease in net assets applicable to
Common shares from distributions
to Common shareholders (12,520,704) (46,706,446)
----------------------------------------------------------------------------------------------------------------------------------
CAPITAL SHARE TRANSACTIONS
Common shares offering costs adjustments -- 67,319
Taxable Auctioned Preferred shares offering costs adjustments -- 25,537
----------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets
applicable to Common shares from
capital share transactions -- 92,856
----------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets
applicable to Common shares 61,310,191 (2,330,113)
Net assets applicable to Common
shares at the beginning of period 629,648,924 631,979,037
----------------------------------------------------------------------------------------------------------------------------------
Net assets applicable to Common
shares at the end of period $ 690,959,115 $ 629,648,924
==================================================================================================================================
Undistributed (Over-distribution of)
net investment income at the
end of period $ 4,331,698 $ 13,125,937
==================================================================================================================================
See accompanying notes to financial statements.
16
Notes to
FINANCIAL STATEMENTS (Unaudited)
1. GENERAL INFORMATION AND SIGNIFICANT ACCOUNTING POLICIES
Nuveen Real Estate Income Fund (the "Fund") is a non-diversified, closed-end
management investment company registered under the Investment Company Act of
1940, as amended. The Fund's Common shares are listed on the American Stock
Exchange and trade under the ticker symbol "JRS." The Fund was organized as a
Massachusetts business trust on August 27, 2001.
The Fund seeks to provide high current income by investing primarily in a
portfolio of income-producing common stocks, preferred stocks, convertible
preferred stocks and debt securities issued by real estate companies, such as
Real Estate Investment Trusts ("REITs").
The following is a summary of significant accounting policies followed by the
Fund in the preparation of its financial statements in accordance with U.S.
generally accepted accounting principles.
Investment Valuation
Exchange-listed securities are generally valued at the last sales price on the
securities exchange on which such securities are primarily traded. Securities
traded on a securities exchange for which there are no transactions on a given
day or securities not listed on a securities exchange are valued at the mean of
the closing bid and asked prices. Securities traded on Nasdaq are valued at the
Nasdaq Official Closing Price. Prices of derivative instruments are also
provided by an independent pricing service approved by the Fund's Board of
Trustees. If the pricing service is unable to supply a price for a derivative
instrument the Fund may use a market quote provided by a major broker/dealer in
such investments. If it is determined that market prices for an investment are
unavailable or inappropriate, the Board of Trustees of the Fund, or its
designee, may establish fair value in accordance with procedures established in
good faith by the Board of Trustees. In establishing fair value, the Board of
Trustees, or its designee, will use a wide variety of market data including
yields or prices of comparable securities, indications of value from security
dealers, general market conditions and other information and analysis.
Short-term investments are valued at amortized cost, which approximates market
value.
Investment Transactions
Investment transactions are recorded on a trade date basis. Realized gains and
losses from investment transactions are determined on the specific
identification method. Investments purchased on a when-issued or delayed
delivery basis may have extended settlement periods. Any investments so
purchased are subject to market fluctuation during this period. The Fund has
instructed the custodian to segregate assets with a current value at least equal
to the amount of the when-issued and delayed delivery purchase commitments. At
March 31, 2006, the Fund had no such outstanding purchase commitments.
Investment Income
Dividend income is recorded on the ex-dividend date. Interest income is recorded
on an accrual basis.
Federal Income Taxes
The Fund intends to distribute substantially all net investment income and net
capital gains to shareholders and to otherwise comply with the requirements of
Subchapter M of the Internal Revenue Code applicable to regulated investment
companies. Therefore, no federal income tax provision is required.
17
Notes to
FINANCIAL STATEMENTS (Unaudited) (continued)
Dividends and Distributions to Common Shareholders
Distributions to Common shareholders are recorded on the ex-dividend date. The
amount and timing of distributions are determined in accordance with federal
income tax regulations, which may differ from U.S. generally accepted accounting
principles.
The Fund makes monthly cash distributions to Common Shareholders of a stated
dollar amount based on the Fund's net investment income, net realized capital
gains and/or on net unrealized capital gains in the Fund's portfolio (stated in
terms of a fixed cents per Common Share dividend rate) ("Managed Distribution
Policy"). The Fund seeks to maintain a stable distribution level, subject to
approval and oversight by the Fund's Board of Trustees. Distributions will be
made only after paying any accrued dividends or making any redemption or
liquidation payments to Taxable Auctioned Preferred shares, if any, and interest
and required principal payments on borrowings, if any. Under the Managed
Distribution Policy, if, for any monthly distribution, net investment income and
net realized capital gain were less than the amount of the distribution, the
difference would be distributed from the Fund's assets and would be treated by
shareholders as a return of capital for tax purposes. Distributions during the
first three months of the fiscal year are classified as having been paid from
net investment income; consequently, this will negatively impact the amount of
undistributed net investment income shown in the financial statements in this
interim report. The final determination of the source of all distributions for
the year are made after the end of the year and reflected in the financial
statements contained in the annual report.
Real Estate Investment Trust ("REIT") distributions received by the Fund are
generally comprised of ordinary income, long-term and short-term capital gains,
and a return of REIT capital. The actual character of amounts received during
the period are not known until after year-end. For the fiscal year ended
December 31, 2005, the character of distributions to the Fund from the REITs was
55.38% ordinary income, 32.12% long-term and short-term capital gains, and
12.50% return of REIT capital.
For the three months ended March 31, 2006, the Fund applied the actual
percentages for the twelve months ended December 31, 2005, described above, to
its receipts from the REITs and treated as income in the Statement of
Operations only the amount of ordinary income so calculated. The Fund adjusts
that estimated breakdown of income type (and consequently its not investment
income) as necessary early in the following calendar year when the REITs inform
their shareholders of the actual breakdown of income type. For the fiscal year
ended December 31, 2005, the Fund applied the actual character of distributions
reported by the REITs in which the Fund invests to its receipts from the REITs.
If a REIT held in the portfolio of investments did not report the actual
character of its distributions during the period, the Fund treated the
distributions as ordinary income.
During the three months ended March 31, 2006, the Fund treated each distribution
to its shareholders from the portfolio REITs as being entirely from net
investment income. The Fund will recharacterize those distributions as being
from ordinary income, long-term and short-term capital gains, and return of
capital, if necessary, at the beginning of the subsequent year, based upon the
income type breakdown information conveyed at the time by the REITs whose
securities are held in the Fund's portfolio. Consequently, the financial
statements at March 31, 2006, reflect an over-distribution of net investment
income that is at least partly attributable to the fact that some of the amounts
received by the Fund from the portfolio REITS, but none of the dividends paid by
the Fund to shareholders, were treated as somthing other than ordinary income.
For fiscal year ended December 31, 2005, the Fund applied the actual character
of distributions reported by the REITs in which the Fund invests to the
distributions paid to the Fund shareholders.
Taxable Auctioned Preferred Shares
The Fund has issued and outstanding 1,720 Series M, 1,720 Series T, 1,720 Series
W and 1,720 Series F, Taxable Auctioned Preferred shares, $25,000 stated value
per share, as a means of effecting financial leverage. The dividend rate paid by
the Fund on each Series is determined every seven days, pursuant to a dutch
auction process overseen by the auction agent, and is payable at the end of each
rate period.
18
Interest Rate Swap Transactions
The Fund is authorized to invest in certain derivative financial instruments.
The Fund's use of interest rate swap transactions is intended to mitigate the
negative impact that an increase in short-term interest rates could have on
Common share net earnings as a result of leverage. Interest rate swap
transactions involve the Fund's agreement with the counterparty to pay a fixed
rate payment in exchange for the counterparty paying the Fund a variable rate
payment that is intended to approximate the Fund's variable rate payment
obligation on Taxable Auctioned Preferred shares or any variable rate borrowing.
The payment obligation is based on the notional amount of the interest rate swap
contract. Interest rate swaps do not involve the delivery of securities or other
underlying assets or principal. Accordingly, the risk of loss with respect to
the swap counterparty on such transactions is limited to the net amount of
interest payments that the Fund is to receive. Interest rate swap positions are
valued daily. Although there are economic advantages of entering into interest
rate swap transactions, there are also additional risks. The Fund helps manage
the credit risks associated with interest rate swap transactions by entering
into agreements only with counterparties the Adviser believes have the financial
resources to honor their obligations and by having the Adviser continually
monitor the financial stability of the swap counterparties.
Repurchase Agreements
In connection with transactions in repurchase agreements, it is the Fund's
policy that its custodian take possession of the underlying collateral
securities, the fair value of which exceeds the principal amount of the
repurchase transaction, including accrued interest, at all times. If the seller
defaults, and the fair value of the collateral declines, realization of the
collateral may be delayed or limited.
Custodian Fee Credit
The Fund has an arrangement with the custodian bank whereby certain custodian
fees and expenses are reduced by credits earned on the Fund's cash on deposit
with the bank. Such deposit arrangements are an alternative to overnight
investments.
Indemnifications
Under the Fund's organizational documents, its Officers and Trustees are
indemnified against certain liabilities arising out of the performance of their
duties to the Fund. In addition, in the normal course of business, the Fund
enters into contracts that provide general indemnifications to other parties.
The Fund's maximum exposure under these arrangements is unknown as this would
involve future claims that may be made against the Fund that have not yet
occurred. However, the Fund has not had prior claims or losses pursuant to these
contracts and expects the risk of loss to be remote.
Use of Estimates
The preparation of financial statements in conformity with U.S. generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities at the
date of the financial statements and the reported amounts of increases and
decreases in net assets applicable to Common shares from operations during the
reporting period. Actual results may differ from those estimates.
2. FUND SHARES
The Fund did not engage in transactions in its own shares during the three
months ended March 31, 2006, nor during the fiscal year ended December 31, 2005.
3. INVESTMENT TRANSACTIONS
Purchases and sales (excluding short-term investments and derivative
transactions) during the three months ended March 31, 2006, aggregated
$83,947,142 and $94,983,117, respectively.
19
Notes to
FINANCIAL STATEMENTS (Unaudited) (continued)
4. 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 recording income and timing differences
in recognizing certain gains and losses on investment transactions.
At March 31, 2006, the cost of investments was $624,561,936.
Gross unrealized appreciation and gross unrealized depreciation of investments
at March 31, 2006, were as follows:
--------------------------------------------------------------------------------
Gross unrealized:
Appreciation $244,019,442
Depreciation (2,338,579)
--------------------------------------------------------------------------------
Net unrealized appreciation (depreciation) of investments $241,680,863
================================================================================
The tax components of undistributed net ordinary income and net realized gains
at December 31, 2005, the Fund's last tax year end, were as follows:
--------------------------------------------------------------------------------
Undistributed net ordinary income * $13,172,759
Undistributed net long-term capital gains --
================================================================================
* Net ordinary income consists of net taxable income derived from dividends,
interest, and net short-term capital gains, if any.
The tax character of distributions paid during the tax year ended December 31,
2005, the Fund's last tax year end, was designated for purposes of the dividends
paid deduction as follows:
--------------------------------------------------------------------------------
Distributions from net ordinary income * $ 9,490,892
Distributions from net long-term capital gains ** 42,608,613
================================================================================
* Net ordinary income consists of net taxable income derived from dividends,
interest, and net short-term capital gains, if any.
** The Fund designated as a long-term capital gain dividend, pursuant to
Internal Revenue Code Section 852(b)(3), the amount necessary to reduce the
earnings and profits of the Fund related to net capital gain to zero for
the tax period ended December 31, 2005.
20
5. MANAGEMENT FEE AND OTHER TRANSACTIONS WITH AFFILIATES
The Fund's management fee is separated into two components - a complex-level
component, based on the aggregate amount of all fund assets managed by Nuveen
Asset Management (the "Adviser"), a wholly owned subsidiary of Nuveen
Investments, Inc., and a specific fund-level component, based only on the
amount of assets within the Fund. This pricing structure enables Nuveen fund
shareholders to benefit from growth in the assets within each individual fund as
well as from growth in the amount of complex-wide assets managed by the Adviser.
The annual fund-level fee, payable monthly, is based upon the average daily
Managed Assets of the Fund as follows:
AVERAGE DAILY MANAGED ASSETS FUND-LEVEL FEE RATE
--------------------------------------------------------------------------------
For the first $500 million .7000%
For the next $500 million .6750
For the next $500 million .6500
For the next $500 million .6250
For Managed Assets over $2 billion .6000
================================================================================
The annual complex-level fee, payable monthly, which is additive to the
fund-level fee, for all Nuveen sponsored funds in the U.S., is based on the
aggregate amount of total fund assets managed as stated in the table below. As
of March 31, 2006, the complex-level fee rate was .1887%.
COMPLEX-LEVEL ASSETS(1) COMPLEX-LEVEL FEE RATE
--------------------------------------------------------------------------------
For the first $55 billion .2000%
For the next $1 billion .1800
For the next $1 billion .1600
For the next $3 billion .1425
For the next $3 billion .1325
For the next $3 billion .1250
For the next $5 billion .1200
For the next $5 billion .1175
For the next $15 billion .1150
For Managed Assets over $91 billion (2) .1400
================================================================================
(1) The complex-level fee component of the management fee for the funds is
calculated based upon the aggregate Managed Assets ("Managed Assets" means
the average daily net assets of each fund including assets attributable to
all types of leverage used by the Nuveen funds) of Nuveen-sponsored funds in
the U.S.
(2) With respect to the complex-wide Managed Assets over $91 billion, the fee
rate or rates that will apply to such assets will be determined at a later
date. In the unlikely event that complex-wide Managed Assets reach $91
billion prior to a determination of the complex-level fee rate or rates to
be applied to Managed Assets in excess of $91 billion, the complex-level fee
rate for such complex-wide Managed Assets shall be .1400% until such time as
a different rate or rates is determined.
The management fee compensates the Adviser for overall investment advisory and
administrative services and general office facilities. The Adviser has entered
into a Sub-Advisory Agreement with Security Capital Research & Management
Incorporated ("Security Capital"), under which Security Capital manages the
investment portfolio of the Fund. Security Capital is compensated for its
services to the Fund from the management fee paid to the Adviser.
The Fund pays no compensation directly to those of its Trustees who are
affiliated with the Adviser or to its officers, all of whom receive remuneration
for their services to the Fund from the Adviser or its affiliates. The Board of
Trustees has adopted a deferred compensation plan for independent Trustees that
enables Trustees to elect to defer receipt of all or a portion of the annual
compensation they are entitled to receive from certain Nuveen advised Funds.
Under the plan, deferred amounts are treated as though equal dollar amounts had
been invested in shares of select Nuveen advised Funds.
For the first ten years of the Fund's operations, the Adviser has agreed to
reimburse the Fund, as a percentage of average daily Managed Assets, for fees
and expenses in the amounts and for the time periods set forth below:
YEAR ENDING YEAR ENDING
NOVEMBER 30, NOVEMBER 30,
--------------------------------------------------------------------------------
2001* .30% 2007 .25%
2002 .30 2008 .20
2003 .30 2009 .15
2004 .30 2010 .10
2005 .30 2011 .05
2006 .30
================================================================================
* From the commencement of operations.
The Adviser has not agreed to reimburse the Fund for any portion of its fees and
expenses beyond November 30, 2011.
21
Notes to
FINANCIAL STATEMENTS (Unaudited) (continued)
6. SUBSEQUENT EVENTS
DISTRIBUTIONS TO COMMON SHAREHOLDERS
The Fund declared a distribution of $.1550 per Common share which was paid on
May 1, 2006, to shareholders of record on April 15, 2006.
TAXABLE AUCTIONED PREFERRED SHARE OFFERING
On May 25, 2006, the Fund issued an additional $50 million in Taxable Auctioned
Preferred shares.
22
Financial
HIGHLIGHTS (Unaudited)
Selected data for a Common share outstanding throughout each period:
Investment Operations Less Distributions
---------------------------------------------------------------- -----------------------------------------
Distributions Distributions
from Net from
Investment Capital
Income to Gains to Net
Beginning Taxable Taxable Investment Capital
Common Net Auctioned Auctioned Income to Gains to Tax
Share Net Realized/ Preferred Preferred Common Common Return
Net Asset Investment Unrealized Share- Share- Share- Share- of
Value Income(a) Gain (Loss) holders+ holders+ Total holders holders Capital Total
====================================================================================================================================
Year Ended 12/31:
2006(b) $22.38 $ .20 $2.49 $(.06) $ -- $2.63 $(.45) $ -- $ -- $ (.45)
2005 22.46 .84 .93 (.03) (.16) 1.58 (.29) (1.37) -- (1.66)
2004(c) 18.57 .88 4.56 (.05) (.04) 5.35 (.69) (.63) (.14) (1.46)
2003(d) 17.30 .12 1.38 (.01) -- 1.49 (.01) (.08) (.13) (.22)
Year Ended 10/31:
2003 13.56 .85 4.38 (.05) (.02) 5.16 (.97) (.41) (.04) (1.42)
2002(e) 14.33 1.02 (.46) (.07) (.02) .47 (.89) (.25) -- (1.14)
====================================================================================================================================
Total Returns
---------------------
Offering
Costs and
Taxable Based
Auctioned Ending on
Preferred Common Based Common
Share Share Ending on Share Net
Underwriting Net Asset Market Market Asset
Discounts Value Value Value** Value**
=======================================================================================
Year Ended 12/31:
2006(b) $ -- $24.56 $22.70 15.87% 11.78%
2005 -- 22.38 19.99 4.75 7.42
2004(c) -- 22.46 20.75 19.80 30.12
2003(d) -- 18.57 18.73 6.49 8.69
Year Ended 10/31:
2003 -- 17.30 17.81 35.40 39.80
2002(e) (.10) 13.56 14.40 3.30 2.09
=======================================================================================
Ratios/Supplemental Data
--------------------------------------------------------------------------------------------
Before Credit/Reimbursement After Credit/Reimbursement***
----------------------------- -----------------------------
Ratio of Net Ratio of Net
Ratio of Investment Ratio of Investment
Ending Expenses Income to Expenses Income to
Net to Average Average to Average Average
Assets Net Assets Net Assets Net Assets Net Assets
Applicable Applicable Applicable Applicable Applicable Portfolio
to Common to Common to Common to Common to Common Turnover
Shares (000) Shares++ Shares++ Shares++ Shares++ Rate
==================================================================================================================
Year Ended 12/31:
2006(b) $690,959 1.25%* 2.96%* .87%* 3.34%* 10%
2005 629,649 1.28 3.46 .90 3.85 13
2004(c) 631,979 1.34 4.13 .94 4.52 14
2003(d) 522,576 2.31* 4.07* 1.91* 4.47* 2
Year Ended 10/31:
2003 486,814 2.51 5.17 2.09 5.59 26
2002(e) 381,290 2.12* 6.71* 1.72* 7.11* 37
==================================================================================================================
Cumulative Taxable Auctioned
Preferred at End of Period
-----------------------------------------
Aggregate Liquidation
Amount and Market Asset
Outstanding Value Coverage
(000) Per Share Per Share
================================================================
Year Ended 12/31:
2006(b) $172,000 $25,000 $125,430
2005 172,000 25,000 116,519
2004(c) 172,000 25,000 116,857
2003(d) 172,000 25,000 100,956
Year Ended 10/31:
2003 172,000 25,000 95,758
2002(e) 172,000 25,000 80,420
================================================================
(a) Per share Net Investment Income is calculated using the average daily
shares method.
(b) For the three months ended March 31, 2006.
(c) For the fiscal year ended December 31, 2004, the Fund changed its method of
presentation for net interest expense on interest rate swap transactions.
The effect of this reclassification was to increase Net Investment Income
by $0.15 per share with a corresponding decrease in Net Realized/Unrealized
Gain (Loss), a decrease in each of the Ratios of Expenses to Average Net
Assets Applicable to Common Shares by 0.77% with a corresponding increase
in each of the Ratios of Net Investment Income to Average Net Assets
Applicable to Common Shares.
(d) For the period November 1, 2003 through December 31, 2003.
(e) For the period November 15, 2001 (commencement of operations) through
October 31, 2002.
* Annualized.
** Total Return on Market Value is the combination of changes in the market
price per share and the effect of reinvested dividend income and reinvested
capital gains distributions, if any, at the average price paid per share at
the time of reinvestment. Total Return on Common Share Net Asset Value is
the combination of changes in Common share net asset value, reinvested
dividend income at net asset value and reinvested capital gains
distributions at net asset value, if any. Total returns are not annualized.
*** After custodian fee credit and expense reimbursement, where applicable.
+ The amounts shown are based on Common share equivalents.
++ o Ratios do not reflect the effect of dividend payments to Taxable
Auctioned Preferred shareholders.
o Income ratios reflect income earned on assets attributable to Taxable
Auctioned Preferred shares.
o For periods ended prior to December 31, 2004, each Ratio of Expenses to
Average Net Assets Applicable to Common Shares and each Ratio of Net
Investment Income to Average Net Assets Applicable to Common Shares
included the effect of the net interest expense incurred on interest
rate swap transactions as follows:
Year Ended 12/31:
2003(d) .91*
Year Ended 10/31:
2003 1.03
2002(e) .68*
See accompanying notes to financial statements.
24-25 SPREAD
23
ITEM 2. CODE OF ETHICS.
Not applicable to this filing.
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.
Not applicable to this filing.
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.
Not applicable to this filing.
ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS.
Not applicable to this filing.
ITEM 6. SCHEDULE OF INVESTMENTS.
See Portfolio of Investments in Item 1.
ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END
MANAGEMENT INVESTMENT COMPANIES.
Not applicable to this filing.
ITEM 8. PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT INVESTMENT COMPANIES.
Not applicable to this filing.
ITEM 9. PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT
COMPANY AND AFFILIATED PURCHASERS.
Not applicable.
ITEM 10. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
During this reporting period, the registrant's Board of Trustees implemented a
change to the procedures by which shareholders may recommend nominees to the
registrant's board of trustees by amending the registrant's by-laws to include a
provision specifying the date by which shareholder nominations for election as
trustee at a subsequent meeting must be submitted to the registrant.
Shareholders must deliver or mail notice to the registrant not less than
forty-five days nor more than sixty days prior to the first anniversary date of
the date on which the registrant first mailed its proxy materials for the prior
year's annual meeting; provided, however, if and only if the annual meeting is
not scheduled to be held within a period that commences thirty days before the
first anniversary date of the annual meeting for the preceding year and ends
thirty days after such anniversary date (an annual meeting date outside such
period being referred to as an "Other Annual Meeting Date" hereafter), the
shareholder notice must be given no later than the close of business on the date
forty-five days prior to such Other Annual Meeting Date or the tenth business
day following the date such Other Annual Meeting Date is first publicly
announced or disclosed. The shareholder's notice must be in writing and set
forth the name, age, date of birth, business address, residence address and
nationality of the person(s) being nominated and the class or series, number of
all shares of the registrant owned of record or beneficially be each such
person(s), any other information regarding such person required by Item 401 of
Regulation S-K or Item 22 of Rule 14a-101 (Schedule 14A) under the Securities
Exchange Act of 1934, as amended, any other information regarding the person(s)
to be nominated that would be required to be disclosed in a proxy statement or
other filings required to be made in connection with solicitation of proxies for
election of trustees, and whether such shareholder believes any nominee is or
will be an "interested person" (as that term is defined in the Investment
Company Act of 1940, as amended) of the registrant or sufficient information to
enable the registrant to make that determination and the written and signed
consent of the person(s) to be nominated.
ITEM 11. 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 Rules 13a-15(b) or
15d-15(b) under the Securities Exchange Act of 1934, as amended (the
"Exchange Act")(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 second fiscal quarter
of the period covered by this report that has materially affected,
or is reasonably likely to materially affect, the registrant's
internal control over financial reporting.
ITEM 12. EXHIBITS.
File the exhibits listed below as part of this Form.
(a)(1) 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: Not applicable to
this filing.
(a)(2) 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)) in the exact form set forth below: Ex-99.CERT
attached hereto.
(a)(3) Any written solicitation to purchase securities under Rule 23c-1 under
the 1940 Act (17 CFR 270.23c-1) sent or given during the period covered by the
report by or on behalf of the registrant to 10 or more persons: Not applicable.
(b) If the report is filed under Section 13(a) or 15(d) of the Exchange Act,
provide the certifications required by Rule 30a-2(b) under the 1940 Act (17 CFR
270.30a-2(b)); Rule 13a-14(b) or Rule 15d-14(b) under the Exchange Act (17 CFR
240.13a-14(b) or 240.15d-14(b)), and Section 1350 of Chapter 63 of Title 18 of
the United States Code (18 U.S.C. 1350) as an exhibit. A certification furnished
pursuant to this paragraph will not be deemed "filed" for purposes of Section 18
of the Exchange Act (15 U.S.C. 78r), or otherwise subject to the liability of
that section. Such certification will not be deemed to be incorporated by
reference into any filing under the Securities Act of 1933 or the Exchange Act,
except to the extent that the registrant specifically incorporates it by
reference. Ex-99.906 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/ Jessica R. Droeger
---------------------------------------
Jessica R. Droeger
Vice President and Secretary
Date: June 8, 2006
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: June 8, 2006
By (Signature and Title)* /s/ Stephen D. Foy
---------------------------------------
Stephen D. Foy
Vice President and Controller
(principal financial officer)
Date: June 8, 2006
* Print the name and title of each signing officer under his or her signature.