N-Q 1 d607907dnq.htm N-Q N-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM N-Q

QUARTERLY SCHEDULE OF PORTFOLIO HOLDINGS OF REGISTERED

MANAGEMENT INVESTMENT COMPANY

Investment Company Act file number                811-21465                               

                                 CBRE Clarion Global Real Estate Income Fund                                

(Exact name of registrant as specified in charter)

201 King of Prussia Road, Suite 600

            Radnor, PA 19087                  

(Address of principal executive offices) (Zip code)

T. Ritson Ferguson, President and Chief Executive Officer

CBRE Clarion Global Real Estate Income Fund

201 King of Prussia Road, Suite 600

                                         Radnor, PA 19087                                                  

(Name and address of agent for service)

Registrant’s telephone number, including area code:    1-877-711-4272        

Date of fiscal year end:    December 31            

Date of reporting period:   September 30, 2018

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.

Attached hereto.


CBRE Clarion Global Real Estate Income Fund

Portfolio of Investments (unaudited)

September 30, 2018

 

 

   

 

 

 

 

 

Shares          Market
Value ($)

 

 

   

 

 

 

 

 

  Real Estate Securities*- 113.1%  
  Common Stock - 91.4%  
  Australia - 4.6%  
  6,448,626     Aventus Retail Property Fund Ltd.   $ 9,985,037      
  14,107,802     Mirvac Group     24,600,566      
  3,688,725     Scentre Group     10,595,842      

 

 

   

 

 

 

 

 

      45,181,445      
   

 

 

 

  Belgium - 0.9%  
  67,859     Warehouses De Pauw CVA     8,937,984      

 

 

   

 

 

 

 

 

  Canada - 2.3%  
  520,400     Chartwell Retirement Residences     5,894,055      
  470,200     Killam Apartment Real Estate Investment Trust     5,867,497      
  439,800     SmartCentres Real Estate Investment Trust     10,380,859      

 

 

   

 

 

 

 

 

      22,142,411      
   

 

 

 

  France - 0.9%  
  36,175     Altarea     8,386,642      

 

 

   

 

 

 

 

 

  Germany - 4.7%  
  163,342     ADO Properties SA     9,789,638      
  191,784     Deutsche EuroShop AG     6,210,466      
  138,194     LEG Immobilien AG     16,412,379      
  280,573     Vonovia SE     13,713,258      

 

 

   

 

 

 

 

 

      46,125,741      
   

 

 

 

  Hong Kong - 7.6%  
  6,057,200     CK Asset Holdings Ltd.     45,477,961      
  1,575,300     Hongkong Land Holdings Ltd.     10,428,486      
  1,833,500     Link REIT     18,054,055      

 

 

   

 

 

 

 

 

      73,960,502      
   

 

 

 

  Ireland - 1.2%  
  7,073,713     Hibernia REIT PLC     11,666,882      

 

 

   

 

 

 

 

 

  Japan - 8.9%  
  1,102,584     Hulic Co. Ltd.     10,823,446      
  15,770     Japan Hotel REIT Investment Corp.     11,481,965      
  1,098     Kenedix Office Investment Corp.     7,008,408      
  932,200     Mitsui Fudosan Co., Ltd.     22,068,810      
  3,756     Nippon Prologis REIT, Inc.     7,436,936      
  570,700     Nomura Real Estate Holdings, Inc.     11,526,045      
  10,382     Orix JREIT, Inc.     16,214,877      

 

 

   

 

 

 

 

 

      86,560,487      
   

 

 

 

  Mexico - 1.3%  
  6,043,300     Prologis Property Mexico SA de CV     12,245,445      

 

 

   

 

 

 

 

 

 

 

   

 

 

 

 

 

Shares          Market
Value ($)

 

 

   

 

 

 

 

 

  Singapore - 2.4%  
  9,442,100     CapitaLand Ltd.   $ 23,288,233      

 

 

   

 

 

 

 

 

  Spain - 1.0%  
  926,151     Inmobiliaria Colonial Socimi SA     9,627,730      

 

 

   

 

 

 

 

 

  Sweden - 2.5%  
  551,515     Castellum AB     9,866,644      
  1,022,420     Fabege AB     14,156,974      

 

 

   

 

 

 

 

 

      24,023,618      
   

 

 

 

  United Kingdom - 4.0%  
  992,045     Hammerson PLC     5,908,218      
  2,211,881     Segro PLC     18,396,719      
  1,260,837     UNITE Group PLC (The)     14,682,652      

 

 

   

 

 

 

 

 

      38,987,589      
   

 

 

 

  United States - 49.1%  
  168,619     Alexandria Real Estate Equities, Inc.     21,210,584      
  163,808     American Campus Communities, Inc.     6,742,337      
  475,745     Columbia Property Trust, Inc.     11,246,612      
  1,060,250     Cousins Properties, Inc.     9,425,622      
  601,301     CubeSmart     17,155,117      
  377,745     CyrusOne, Inc. (a)     23,949,033      
  598,793     Douglas Emmett, Inc.     22,586,472      
  489,199     Duke Realty Corp.     13,878,576      
  38,199     Equinix, Inc. (a)     16,535,965      
  322,863     Equity Residential     21,392,902      
  88,093     Essex Property Trust, Inc. (a)     21,733,424      
  367,354     Extra Space Storage, Inc. (a)     31,827,551      
  850,172     Healthcare Trust of America, Inc., Class A     22,674,087      
  184,093     Hilton Worldwide Holdings, Inc.     14,871,033      
  1,163,556     Invitation Homes, Inc.     26,657,068      
  459,100     Macerich Co. (The)     25,383,639      
  543,616     MGM Growth Properties LLC, Class A     16,031,236      
  165,903     Park Hotels & Resorts, Inc.     5,444,936      
  545,592     Piedmont Office Realty Trust, Inc., Class A     10,328,057      
  163,903     Prologis, Inc.     11,110,984      
  445,100     Regency Centers Corp.     28,784,617      
  80,424     Simon Property Group, Inc. (a)     14,214,942      
  307,335     STORE Capital Corp.     8,540,840      
  228,724     Sun Communities, Inc.     23,224,635      
  244,421     Taubman Centers, Inc.     14,623,708      
  2,156,485     VEREIT, Inc.     15,656,081      
  297,101     VICI Properties, Inc.     6,423,324      
  256,349     Welltower, Inc.     16,488,368      

 

 

   

 

 

 

 

 

      478,141,750      
   

 

 

 

 

Total Common Stock

 

(cost $892,593,404)

    889,276,459      

 

 

   

 

 

 

 

 

 

 

See previously submitted notes to financial statements for the semi-annual period ended June 30, 2018.


CBRE Clarion Global Real Estate Income Fund

Portfolio of Investments (unaudited) concluded

September 30, 2018

 

 

    

 

  

 

 

 
Shares           Market
Value ($)
 

 

 

    

 

  

 

 

 
   Preferred Stock - 21.7%   
   United States - 21.7%   
  525,265      American Homes 4 Rent, Series D, 6.500%    $ 13,131,625      
  741,000      Brookfield Property REIT, Inc., Series A, 6.375%      17,969,250      
  100,000      CBL & Associates Properties, Inc., Series D, 7.375%      1,597,000      
  369,474      DDR Corp., Series J, 6.500%      9,018,861      
  500,302      Digital Realty Trust, Inc., Series C, 6.625%      13,127,924      
  245,403      Digital Realty Trust, Inc., Series J, 5.250%      5,862,678      
  280,000      EPR Properties, Series G, 5.750%      6,507,200      
  282,200      Federal Realty Investment Trust, Series C, 5.000%      6,456,736      
  767,325      iStar, Inc., Series I, 7.500%      18,630,651      
  400,000      LaSalle Hotel Properties, Series I, 6.375%      9,896,000      
  500,000      LaSalle Hotel Properties, Series J, 6.300%      12,180,000      
  284,500      National Storage Affiliates Trust, Series A, 6.000%      7,064,135      
  500,000      Pebblebrook Hotel Trust, Series D, 6.375%      12,450,000      
  272,000      Pennsylvania Real Estate Investment Trust, Series B, 7.375%      6,394,720      
  341,100      Pennsylvania Real Estate Investment Trust, Series C, 7.200%      7,746,381      
  600,000      Public Storage, Series B, 5.400%      14,640,000      
  143,517      Rexford Industrial Realty, Inc., Series B, 5.875%      3,554,916      
  150,000      STAG Industrial, Inc., Series C, 6.875%      3,907,500      
  225,000      Summit Hotel Properties, Inc., Series D, 6.450%      5,496,750      
  287,077      Summit Hotel Properties, Inc., Series E, 6.250%      6,775,017      
  600,000      Sunstone Hotel Investors, Inc., Series E, 6.950%      15,564,000      
  379,377      Sunstone Hotel Investors, Inc., Series F, 6.450%      9,554,610      
  120,000      Taubman Centers, Inc., Series K, 6.250%      3,015,600      

 

 

    

 

  

 

 

 
  

Total Preferred Stock

 

(cost $215,619,731)

     210,541,554      

 

 

    

 

  

 

 

 
  

Total Investments - 113.1%

(cost $1,108,213,135)

     1,099,818,013      

 

 

    

 

  

 

 

 
  

Liabilities in Excess of Other

Assets - (13.1)%

     (127,168,695)     

 

 

    

 

  

 

 

 
   Net Assets - 100.0%    $ 972,649,318      

 

 

    

 

  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Number of
Contracts
      Notional
Amount
 

Market

Value ($)

 

 

 

 

 

 

 

 

 

 

 

  Written Call Options - (0.0)%(b)

 

 
  United States - (0.0)%(b)

 

 

(1,486)

  CyrusOne, Inc.    
  Expires 10/19/2018    
  Strike Price $70.00     (148,600   $ (7,430 )    

(175)

  Equinix, Inc.    
  Expires 10/19/2018    
  Strike Price $460.00     (17,500     (11,375 )    

(425)

  Essex Property Trust, Inc.    
  Expires 10/19/2018    
  Strike Price $260.00     (42,500     (9,563 )    

(1,033)

  Extra Space Storage, Inc.    
  Expires 10/19/2018    
  Strike Price $95.00     (103,300     (25,825 )    

(388)

  Simon Property Group, Inc.    
  Expires 10/19/2018    
  Strike Price $190.00     (38,800     (2,716 )    

 

 

 

 

 

 

 

 

 

 

 

 

Total Written Call Options

(Premiums Received $274,694)

    $ (56,909 )    

 

 

 

 

 

 

 

 

 

 

 

 

*

Includes U.S. Real Estate Investment Trusts (“REIT”) and Real Estate Operating Companies (“REOC”) as well as entities similarly formed under the laws of non-U.S. countries.

(a)

A portion of the security has been pledged for open written option contracts. The aggregate market value of the collateral as of September 30, 2018 is $43,422,942.

(b)

Rounds to less than 0.1%

 

`

 

See previously submitted notes to financial statements for the semi-annual period ended June 30, 2018.


Notes to Portfolio of Investments (unaudited)

(A) Securities Valuation

U.S. generally accepted accounting principles (“U.S. GAAP”) provides guidance on fair value measurements. In accordance with the standard, fair value is defined as the price that the Trust would receive to sell an investment or pay to transfer a liability in a timely transaction with an independent buyer in the principal market, or in the absence of a principal market the most advantageous market for the investment or liability. It establishes a single definition of fair value, creates a three-tier hierarchy as a framework for measuring fair value based on inputs used to value the Trust’s investments, and requires additional disclosure about fair value. The hierarchy of inputs is summarized below:

 

• Level 1   -  

unadjusted quoted prices in active markets for identical investments

• Level 2   -  

Other significant observable inputs (including quoted prices for similar investments, interest rates, prepayment speeds, credit risk, etc.)

• Level 3   -  

significant unobservable inputs (including the Trust’s own assumptions in determining the fair value of investments)

For Level 1 inputs, the Trust uses unadjusted quoted prices in active markets for assets or liabilities with sufficient frequency and volume to provide pricing information as the most reliable evidence of fair value.

The Trust’s Level 2 valuation techniques include inputs other than quoted prices within Level 1 that are observable for an asset or liability, either directly or indirectly. Level 2 observable inputs may include quoted prices for similar assets and liabilities in active markets or quoted prices for identical or similar assets or liabilities in markets that are not active in which there are few transactions, the prices are not current, or price quotations vary substantially over time or among market participants. Inputs that are observable for the asset or liability in Level 2 include such factors as interest rates, yield curves, prepayment speeds, credit risk, and default rates for similar liabilities.

For Level 3 valuation techniques, the Trust uses unobservable inputs that reflect assumptions market participants would be expected to use in pricing the asset or liability. Unobservable inputs are used to measure fair value to the extent that observable inputs are not available and are developed based on the best information available under the circumstances. In developing unobservable inputs, market participant assumptions are used if they are reasonably available without undue cost and effort.

The inputs or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities. The following is a summary of the inputs used as of September 30, 2018 in valuing the Trust’s investments carried at fair value:

 

        Assets    Level 1          Level 2          Level 3          Total  

Investments in Real Estate Securities

           

 

Common Stock

           

Australia

   $       45,181,445      $                   –      $                   –      $         45,181,445  

Belgium

     8,937,984                      8,937,984  

Canada

     22,142,411                      22,142,411  

France

     8,386,642                      8,386,642  

Germany

     46,125,741                      46,125,741  

Hong Kong

     73,960,502                      73,960,502  

Ireland

     11,666,882                      11,666,882  

Japan

     86,560,487                      86,560,487  

Mexico

     12,245,445                      12,245,445  

Singapore

     23,288,233                      23,288,233  

Spain

     9,627,730                      9,627,730  

Sweden

     24,023,618                      24,023,618  

United Kingdom

     38,987,589                      38,987,589  

United States

     478,141,750                      478,141,750  

Total Common Stock

     889,276,459                      889,276,459  

Preferred Stock

           

United States

     158,049,444        52,492,110               210,541,554  

Total Investments in Real Estate Securities

   $   1,047,325,903      $   52,492,110      $                   –      $    1,099,818,013  

 

Liabilities

                                   

Other Financial Instruments

           

Written Call Options

   $            (21,521)      $         (35,388)      $                     –      $             (56,909)  

Total Liabilities

   $            (21,521)      $         (35,388)      $                     –      $             (56,909)  

 

See previously submitted notes to financial statements for the semi-annual period ended June 30, 2018.


Notes to Portfolio of Investments (unaudited) (continued)

 

The primary third party pricing vendor for the Trust’s listed preferred stock investments is FT Interactive Data (“IDC”). When available, the Trust will obtain a closing exchange price to value the preferred stock investments and, in such instances, the investment will be classified as Level 1 since an unadjusted quoted price was utilized. When a closing price is not available for the listed preferred stock investments, IDC will produce an evaluated mean price (midpoint between the bid and the ask evaluation) and such investments will be classified as Level 2 since other observable inputs were used in the valuation. Factors used in the IDC evaluation include trading activity, the presence of a two-sided market, and other relevant market data.

The Trust’s policy is to recognize transfers in and transfers out at the fair value as of the beginning of the period. The portfolio may hold securities which are periodically fair valued in accordance with the Trust’s fair value procedures. This may result in movements between Levels 1, 2 and 3 throughout the period. $25,378,500 was transferred out of Level 1 into Level 2 during the period ended September 30, 2018 due to the unavailability of significant observable pricing inputs. $3,651,072 was transferred out of level 2 into level 1 during the period ended September 30, 2018 due to the availability of significant observable pricing inputs. Pursuant to the Trust’s fair value procedures noted previously, equity securities (including exchange traded securities and open-end regulated investment companies) and exchange traded derivatives (i.e. futures contracts and options) are generally categorized as Level 1 securities in the fair value hierarchy. Fixed income securities, non-exchange traded derivatives and money market instruments are generally categorized as Level 2 securities in the fair value hierarchy. Investments for which there are no such quotations, or for which quotations do not appear reliable, are valued at fair value as determined in accordance with procedures established by and under the general supervision of the Trustees. These valuations are typically categorized as Level 2 or Level 3 securities in the fair value hierarchy.

For the period ended September 30, 2018, there have been no significant changes to the Trust’s fair valuation methodology.

(B) Forward Foreign Currency Contracts

The Trust enters into forward foreign currency contracts in order to hedge its exposure to changes in foreign currency exchange rates on its foreign portfolio holdings, to hedge certain Trust purchase and sales commitments denominated in foreign currencies and for investment purposes. A forward foreign currency contract is a commitment to purchase or sell a foreign currency on a future date at a negotiated forward rate. The gain or loss arising from the difference between the original contracts and the closing of such contracts would be included in net realized gain or loss on foreign currency transactions.

Fluctuations in the value of open forward foreign currency contracts are recorded for financial reporting purposes as unrealized appreciation and depreciation by the Trust.

The Trust’s custodian will place and maintain cash not available for investment or other liquid assets in a separate account of the Trust having a value at least equal to the aggregate amount of the Trust’s commitments under forward foreign currency contracts entered into with respect to position hedges.

Risks may arise from the potential inability of counterparty to meet the terms of a contract and from unanticipated movements in the value of a foreign currency relative to the U.S. dollar. The face or contract amount, in U.S. dollars, reflects the total exposure the Trust has in that particular currency contract. As of September 30, 2018, the Trust did not hold any forward foreign currency contracts.

(C) Options

The Trust may purchase or sell (write) options on securities and securities indices which are listed on national securities exchange or in the over-the-counter (“OTC”) market as a means of achieving additional return or of hedging the value of the Trust’s portfolio.

An option on a security is a contract that gives the holder of the option, in return for a premium, the right to buy from (in the case of a call) or sell to (in the case of a put) the writer of the option the security underlying the option at a specified exercise or “strike” price. The writer of an option on a security has an obligation upon exercise of the option to deliver the underlying security upon payment of the exercise price (in the case of a call) or to pay the exercise price upon delivery of the underlying security (in the case of a put).

There are several risks associated with transactions in options on securities. As the writer of a covered call option, the Trust forgoes, during the option’s life, the opportunity to profit from increases in the market value of the security covering the call option above the sum of the premium and the strike price of the call but has retained the risk of loss should the price of the underlying security decline. The writer of an option has no control over the time when it may be required to fulfil its obligation as writer of the option. Once an option writer has received an exercise notice, it cannot effect a closing purchase transaction in order to terminate its obligation under the option and must deliver the underlying security at the exercise price. Written Options for the period ended September 30, 2018 are disclosed in the Trust’s Portfolio of Investments.

 

See previously submitted notes to financial statements for the semi-annual period ended June 30, 2018.


Notes to Portfolio of Investments (unaudited) (concluded)

 

(D) New Accounting Pronouncement

In August 2018, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework—Changes to the Disclosure Requirements for Fair Value Measurements. The amendments in the ASU modify the disclosure requirements on fair value measurements in Topic 820. The ASU is effective for interim and annual reporting periods beginning after December 15, 2019. Management is currently evaluating the impact, if any, of applying this provision and believes the adoption of this ASU will not have a material impact on the financial statements.

 

See previously submitted notes to financial statements for the semi-annual period ended June 30, 2018.


Item 2. Controls and Procedures.

 

  (a)

The Trust’s principal executive officer and principal financial officer have evaluated the Trust’s disclosure controls and procedures within 90 days of this filing and have concluded that the Trust’s disclosure controls and procedures were effective, as of that date, in ensuring that information required to be disclosed by the Trust in this Form N-Q was recorded, processed, summarized, and reported timely.

 

  (b)

The Trust’s principal executive officer and principal financial officer are aware of no changes in the Trust’s internal control over financial reporting that occurred during the Trust’s most recent quarter that has materially affected, or is reasonably likely to materially affect, the Trust’s internal control over financial reporting.

Item 3. Exhibits.

Certification of chief executive officer and chief financial officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.


SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

(Registrant)    CBRE Clarion Global Real Estate Income Fund

By (Signature and Title)*        /s/ T. Ritson Ferguson                                                                             

 

                                                T. Ritson Ferguson

 

                                                President and Chief Executive Officer

Date 11/19/2018

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/ T. Ritson Ferguson                                                                             

  

                                T. Ritson Ferguson

  

                                President and Chief Executive Officer

Date 11/19/2018

By (Signature and Title)*        /s/ Jonathan A. Blome                                                                             

  

                               Jonathan A. Blome

  

                               Chief Financial Officer

Date 11/19/2018

* Print the name and title of each signing officer under his or her signature.