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Morningstar FundInvestor
August
2015
Morningstar Analyst Rating
07-17-15
Œ
Morningstar Pillars
Process
Performance
People
Parent
Price
Positive
Positive
Positive
Positive
Positive
Morningstar Analyst Rating
Morningstar evaluates mutual funds based on five key pillars, which
its analysts believe lead to funds that are more likely to outperform
over the long term on a risk-adjusted basis.
Analyst Rating Spectrum
Π㠫
•
•
¨
Pillar Spectrum
Positive
§
Negative
¶
Neutral
NAV
26.74
26.86
21.21
21.01
18.36
17.50
13.83
11.13
19.18
25.33
19.49
17.90
Total Return %
0.52
29.75
3.28
17.03
7.32
29.89
31.65
-39.08
-18.80
36.75
14.54
36.82
+/-MSCI Ac Wrld ND
-3.03
25.59
-19.52
0.90
14.67
17.22
-2.98
3.11
-30.46
15.80
3.70
21.59
+/-S&P US REIT TR USD
1.35
-0.51
0.88
-0.96
-1.16
1.42
3.05
-0.75
-2.10
0.72
2.37
5.04
Income Return %
0.97
2.86
2.35
2.53
2.30
3.07
5.06
3.91
2.90
3.23
3.98
4.46
Capital Return %
-0.45
26.89
0.93
14.50
5.02
26.82
26.59
-42.99
-21.70
33.52
10.56
32.36
Total Rtn % Rank Cat
19
45
14
43
59
16
26
55
82
20
27
13
Income $
0.26
0.60
0.49
0.46
0.40
0.42
0.55
0.74
0.72
0.62
0.70
0.60
Capital Gains $
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.79
0.60
0.24
0.07
Expense Ratio %
.
0.76
0.79
0.78
0.78
0.76
0.77
0.75
0.73
0.78
0.85
0.90
Income Ratio %
.
1.54
1.25
1.35
1.10
1.26
2.84
2.85
1.49
1.60
1.86
2.74
Turnover Rate %
.
3
4
6
5
13
20
15
33
25
18
8
Net Assets $mil
4,617
4,826
3,476
3,392
2,670
2,519
2,206
1,585
1,940
2,333
944
640
Performance
07-31-15
1st Qtr
2nd Qtr
3rd Qtr
4th Qtr
Total
2011
2012
2013
2014
2015
6.01 4.50 -15.37 14.47
7.32
12.53 2.40
0.15 1.41 17.03
5.90 -0.85
-2.34 0.72
3.28
10.00 6.51
-3.05 14.23 29.75
5.55 -9.89
. . .
Trailing
Total +/- MSCI
+/- S&P %Rank Growth of
Return%Ac Wrld ND US REIT TR USD
Cat
$10,000
3 Mo
6 Mo
1 Yr
3 Yr Avg
5 Yr Avg
10 Yr Avg
15 Yr Avg
1.00 2.63
0.42
36 10,100
-4.89 -10.09
2.16
17 9,511
11.50 8.67
1.71
18 11,150
10.64 -2.19
0.61
12 13,544
13.57 3.19
0.16
13 18,894
6.94 0.83
0.19
32 19,561
11.29 7.39
0.08
21 49,756
Tax Analysis
Tax-Adj Rtn% %Rank Cat Tax-Cost Rat %Rank Cat
3 Yr (estimated)
5 Yr (estimated)
10 Yr (estimated)
9.58
4
0.96
29
12.55
9
0.89
43
5.61
20
1.25
31
Potential Capital Gain Exposure: 36% of assets
Rating and Risk
Time Load-Adj
Morningstar
Morningstar
Morningstar
Period Return % Rtn vs Cat
Risk vs Cat
Risk-Adj Rating
1 Yr
11.50
3 Yr
10.64
+Avg
Avg
5 Yr
13.57
+Avg
-Avg
10 Yr
6.94
+Avg
+Avg
Incept
10.28
Other Measures
Standard Index
Best Fit Index
MSCI Ac Wrld ND S&P US REIT TR USD
Alpha
5.5
1.2
Beta
0.44
0.93
R-Squared
9
98
Standard Deviation
13.02
Mean
10.64
Sharpe Ratio
0.84
Morningstar’s Take
by David Kathman, CFA 07-17-15
T. Rowe Price Real Estate has long been a top choice
for fund investors seeking real estate exposure,
earning it a Morningstar Analyst Rating of Gold. It has
one of the most consistently solid long-term records in
the real estate Morningstar Category; as of July 2015,
its returns ranked near the top of the category since its
1997 inception. While it has seldom been among the
best performers in any given year, it has mostly
avoided big losses and has managed to outpace its
peers in a wide variety of market conditions.
Investors have a single manager to thank for this
impressive record: David Lee, who has been in charge
since the fund launched. He employs a strategy that’s
grounded in fundamentals and focused on the long
term, thus accounting for the portfolio’s low annual
turnover (typically around 10%). Lee and his team look
for REITs and real estate operating companies with
good long-term growth prospects and talented
management teams that are trading below the net
asset value of their underlying real estate assets.
Lee puts a lot of emphasis on the quality of those
underlying assets, with location being a primary
consideration. That’s why the fund has
long been underweight relative to its peers in
health-care REITs, which often feature properties in
unattractive locations. The fund also doesn’t own
data-center REITs, which have been hot recently for
their role in cloud computing, but which tend to have
similarly poor locations.
The lack of health-care REITs hurt the fund in the
brutal 2007-08 downturn, but for the most part, Lee’s
long-term, quality-focused strategy is well-suited to
down markets. The fund ranked in the category’s top
quartile in 2013 and the first half of 2015, two periods
when REITs took a beating in anticipation of rising
interest rates. But it has also performed well in bull
markets for REITs, easily beating its category peers in
2009 and 2010, and edging past them in 2012 and
2014 with gains of 17% and 30%. Recent turnover on
the analyst staff bears watching, but overall this is an
excellent fund, with low expenses adding to its
numerous other pluses.
Address:
T. Rowe Price Real Estate Fund, Inc.
Baltimore, MD 21202
800-638-2587
Web Address:
www.troweprice.comInception:
10-31-97
Advisor:
T. Rowe Price Associates, Inc.
Subadvisor:
None
NTF Plans:
N/A
Minimum Purchase:
$2500
Add: $100 IRA: $1000
Min Auto Inv Plan:
$2500
Add: $100
Sales Fees:
No-load, 1.00%R
Management Fee:
0.30%, 0.15%A
Actual Fees:
Mgt:0.59% Dist:
.
Expense Projections:
3Yr:$243
5Yr:$422 10Yr:$942
Income Distribution:
Quarterly
Data through July 31, 2015
T. Rowe Price Real Estate
Ticker
Status Yield Total Assets
Mstar Category
TRREX Open
2.2% $4,878 mil
Real Estate
97% 92% 93% 93% 93% 95% 93% 94% 94%
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 07-15
Historical Profile
Return
Risk
Rating
Above Avg
Average
Above Avg
Investment Style
Equity
Stock %
Manager Change
Partial Manager Change
Growth of $10,000
Investment Values of
Fund
Investment Values of
MSCI Ac Wrld ND
Performance Quartile
(within Category)
History
10.0
6.0
15.0
20.0
27.0
Portfolio Analysis
06-30-15
Share change since 03-15 Total Stocks:39 Sector
PE Tot Ret% % Assets
Simon Property Group Inc
Real Est
40.5 4.40 9.24
AvalonBay Communities In
Real Est
30.4 7.01 5.33
T. Rowe Price Reserve In
. . .
4.92
Essex Property Trust Inc
Real Est
92.6 10.26 4.77
Equity Residential
Real Est
38.9 5.67 4.29
General Growth Propertie
Real Est
27.1 -2.31 4.28
Public Storage
Real Est
37.6 12.68 4.27
Prologis Inc
Real Est
20.4 -3.95 4.08
Federal Realty Investmen
Real Est
55.6 3.80 3.84
SL Green Realty Corp
Real Est
50.8 -2.25 3.69
Boston Properties Inc
Real Est
65.8 -3.19 3.41
Vornado Realty Trust
Real Est
64.9 -7.32 3.34
Regency Centers Corp
Real Est
51.0 1.82 3.12
Macerich Co
Real Est
7.8 -3.54 3.08
Camden Property Trust
Real Est
19.3 9.74 2.55
Kimco Realty Corp
Real Est
19.4 0.20 2.50
Kilroy Realty Corp
Real Est
51.5 3.59 2.49
Douglas Emmett Inc
Real Est
103.1 4.68 2.44
Hilton Worldwide Holding
Cnsmr Cyc 40.6 2.91 2.02
Weingarten Realty Invest
Real Est
49.3 2.72 2.01
Current Investment Style
Market Cap %
Giant
0.0
Large
42.6
Mid
42.7
Small
13.6
Micro
1.0
Avg $mil:
10,868
Value Blnd Growth
Large Mid Small
Value Measures
Rel Category
Price/Earnings
Price/Book
Price/Sales
Price/Cash Flow
Dividend Yield %
40.56
2.50
7.50
17.61
3.40
1.02
1.12
1.26
1.17
0.97
Growth Measures
% Rel Category
Long-Term Erngs
Book Value
Sales
Cash Flow
Historical Erngs
7.01
3.64
1.93
20.93
46.94
1.10
1.42
0.49
4.55
7.71
Profitability
% Rel Category
Return on Equity
Return on Assets
Net Margin
12.94
4.39
30.90
1.72
1.64
1.60
Industry
Weightings
% of
Stocks
Rel
Cat
Retail
39.0
1.5
Residential
21.3
1.0
Industrial
11.6
1.0
Healthcare
1.9
0.2
Office
14.8
1.1
Diversified
5.9
0.8
Hotel/Motel
2.7
0.5
Mgmt & Dev
0.0
0.0
Other
2.9
0.9
Composition - Net
(% of Stock)
Cash
4.7
Stocks 94.4
Bonds 0.0
Other
1.0
Foreign 0.0
©
2015Morningstar, Inc.All rights reserved. The information herein isnot representedorwarranted to be accurate, correct, complete or
timely.Past performance isnoguaranteeof future results.Accessupdated reports at
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