Principal Real Estate Income Fund Begins Trading on the New York Stock Exchange [NYSE: PGZ]
PGZ Offers Access to a Dynamic Investment Strategy Investing in the Debt and Equity of Commercial Real Estate
DENVER--(BUSINESS WIRE)-- ALPS Advisors, Inc., a DST Company focused on asset servicing and asset gathering, and Principal Real Estate Investors, LLC, one of the largest institutional real estate managers in the United States, today announced the completion of the initial public offering of common shares listed on the New York Stock Exchange for the Principal Real Estate Income Fund (the "Fund").
The Fund raised approximately $126 million in proceeds (before deduction of the sales load and offering expenses and exclusive of the underwriters' overallotment option) in the offering of 6.3 million common shares at $20 per share. The Fund has granted the underwriters an option to purchase additional common shares at the public offering price less the sales load within 45 days of the offering to cover over-allotments, if any.
Wells Fargo Securities, LLC, UBS Securities LLC and RBC Capital Markets, LLC served as lead underwriters in connection with the offering.
"We believe an investment strategy combining debt and equity interests in commercial real estate offers the potential for high current income and capital appreciation, while also providing portfolio diversification benefits to investors," said Marc Peterson, portfolio manager and managing director at Principal Real Estate Investors, and one of the Fund's portfolio managers.
The new closed-end fund seeks to benefit from the recovery in commercial real estate markets by investing in higher-yielding debt and equity investments. The Fund will invest at least 80 percent of its total assets in commercial real estate-related securities, primarily consisting of commercial mortgage backed securities ("CMBS") and other U.S. and non-U.S. real estate-related securities (primarily real estate investment trusts ("REITs") or REIT-like entities). Under normal circumstances, the Fund will invest between 40 and 70 percent of its total assets in CMBS and will invest between 30 and 60 percent in other real estate-related securities (including REITs). CMBS are bonds secured by a diversified pool of first-lien mortgages on commercial real estate property. REITs are pooled investment vehicles that invest directly in income producing real estate, real estate-related loans, or other types of real estate interests.
Additional information on Principal Real Estate Income Fund [PGZ] can be found at www.principalcef.com .
An investment in the Fund is not appropriate for all investors and is not intended to be a complete investment program. The Fund is designed as a long-term investment and not as a trading vehicle.
Investing in the Fund involves risks, including the risk that you may receive little or no return on your investment or that you may lose part or even all of your investment. Therefore, before investing you should carefully consider the risks that you assume when you invest in the Fund's common shares.
The Fund's investment objectives and policies are not designed to seek to return the initial investment to investors that purchase shares.
Investors should consider the Fund's investment objectives, risks, charges and expenses carefully before investing. The prospectus contains this and other information about the fund. For more complete information about the Fund or to obtain a copy of the prospectus, call your financial professional, visit the Fund's site at www.principalcef.com or call 855.838.9485. Please read the prospectus carefully before investing.
Investing in the Fund involves risks, including exposure to below-investment grade investments (i.e., "junk bonds"). The Fund's net asset value will vary and its distribution rate may vary and both may be affected by numerous factors, including changes in the market spread over a specified benchmark, market interest rates and performance of the broader equity markets. Fluctuations in net asset value may be magnified as a result of the Fund's use of leverage.
Because the Fund is newly organized, its Common Shares have no history of public trading. Shares of closed-end investment companies frequently trade at a discount from their net asset value and initial offering prices. The risks associated with this characteristic of closed-end investment companies may be greater for investors expecting to sell their shares in a relatively short period after completion of the initial public offering.
NOT FDIC INSURED | May Lose Value | No Bank Guarantee
ALPS provides customized asset servicing and asset gathering solutions to the financial services community through an entrepreneurial culture based on the commitment to "Do Things Right." Founded in 1985, ALPS continues to actively promote all of its various business segments, from asset servicing through ALPS Fund Services, Inc. to asset gathering through ALPS Distributors, Inc. and ALPS Advisors, Inc. Headquartered in Denver, with offices in Boston, New York, Seattle, and Toronto, ALPS, a wholly-owned subsidiary of DST Systems, Inc., today represents more than 400 employees, over 200 clients, and an executive team that has been in place for more than 18 years. For more information about ALPS and its services, visit www.alpsinc.com. Information about ALPS products is available at www.alpsfunds.com.
About Principal Real Estate Investors
Principal Real Estate Investors advises or subadvises $46.5 billion in real estate assets1. The firm's real estate capabilities include both public and private equity and debt investment alternatives. Principal Real Estate Investors is the dedicated real estate group of Principal Global Investors, a diversified asset management organization and a member of the Principal Financial Group®.
This document is not an offer to sell securities or the solicitation of an offer to buy securities, nor shall there be any sale or offer of these securities in any jurisdiction where such sale or offer is not permitted.
1 As of March 31, 2013
KEYWORDS: United States North America Colorado
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