Cohen & Steers Institutional Realty Shares, Inc.
Cohen & Steers Institutional Realty Shares, Inc.
A
NO‑LOAD MUTUAL FUND (CSRIX)
280
PARK AVENUE
NEW
YORK, NEW YORK 10017
PROSPECTUS
Advisor
Cohen &
Steers Capital Management, Inc.
280
Park Avenue
New
York, New York 10017
Telephone:
(212) 832‑3232
Transfer Agent
P.O.
Box 219953
Kansas
City, MO 64121-9953
Telephone:
(800) 437‑9912
THE
SECURITIES AND EXCHANGE COMMISSION HAS NOT APPROVED OR DISAPPROVED OF THE FUND’S
SHARES OR DETERMINED WHETHER THIS PROSPECTUS IS TRUTHFUL OR COMPLETE. ANYONE WHO
INDICATES OTHERWISE IS COMMITTING A CRIME.
TABLE
OF CONTENTS
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COHEN &
STEERS INSTITUTIONAL REALTY SHARES, INC.
SUMMARY
SECTION
INVESTMENT
OBJECTIVE
The
investment objective of Cohen & Steers Institutional Realty Shares,
Inc. (the “Fund”) is total return through investment in real estate securities.
FUND
FEES AND EXPENSES
This
table describes the fees and expenses that you could pay if you buy and hold
shares of the Fund. You may pay other fees, such
as brokerage commissions and other fees to financial intermediaries, which are
not reflected in the tables and examples below. If you purchase shares
through a financial intermediary acting as an agent on behalf of its customers,
that financial intermediary may charge you a commission. Such commissions, if
any, are not charged by the Fund and are not reflected in the fee table or
expense example below.
|
| |
Shareholder Fees (fees paid directly from
your investment): |
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Maximum
Sales Charge (Load) Imposed On Purchases (as % of offering price) |
|
None |
Maximum
Deferred Sales Charge (Load) (as % of the net asset value at the time of
purchase or redemption, whichever is lower) |
|
None |
| |
|
Annual Fund Operating Expenses (expenses
that you pay each year as a percentage of the value of your
investment): |
|
|
Management
Fee |
|
0.75% |
Other
Expenses |
|
0.01% |
| |
|
Total
Annual Fund Operating Expenses(1) |
|
0.76% |
Fee
Waiver/Expense Reimbursement(1) |
|
(0.01)% |
| |
|
Total Annual Fund Operating Expenses (after fee
waiver/expense reimbursement)(1). |
|
0.75% |
| |
|
(1) |
Cohen &
Steers Capital Management, Inc., the Fund’s investment advisor (the
“Advisor”), has contractually agreed to waive total annual Fund operating
expenses (excluding brokerage fees and commissions, taxes, certain other
expenses and, upon approval of the Fund’s Board of Directors,
extraordinary expenses) so that total annual Fund operating expenses, as
reflected in the Fund’s financial statements, never exceed 0.75% of
average daily net assets. This commitment is currently expected to remain
in place for the life of the Fund, can only be amended or terminated by
agreement of the Fund’s Board of Directors and the Advisor and will
terminate automatically in the event of termination of the investment
management agreement between the Fund and the Advisor.
|
EXAMPLE
This
example is intended to help you compare the cost of investing in the Fund with
the cost of investing in other mutual funds. The example assumes that you invest
$1,000,000 (the Fund’s minimum initial investment) in the Fund for the time
periods indicated and then redeem all of your shares at the end of those
periods. The example also assumes that your investment has a 5% return each year
and that the Fund’s operating expenses remain the same pursuant to its agreement
with the Advisor. Although your actual costs may be higher or lower, based on
these assumptions your costs would be:
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1
Year |
|
|
3 Years |
|
|
5 Years |
|
|
10 Years |
|
$ |
7,659 |
|
|
$ |
23,969 |
|
|
$ |
41,693 |
|
|
$ |
93,032 |
|
1
PORTFOLIO
TURNOVER
The
Fund pays transaction costs, such as commissions, when it buys and sells
securities (or “turns over” its portfolio). A higher portfolio turnover rate may
indicate higher transaction costs and may result in higher taxes when Fund
shares are held in a taxable account. These costs, which are not reflected in
the annual fund operating expenses or in the example, affect the Fund’s
performance. During the Fund’s most recent fiscal year, the Fund’s portfolio
turnover rate was 34% of the average value of its
portfolio.
PRINCIPAL
INVESTMENT STRATEGIES
The
Advisor adheres to a bottom‑up, relative value investment process when selecting
publicly traded real estate securities. To guide the portfolio construction
process, the Advisor utilizes a proprietary valuation model that quantifies
relative valuation of real estate securities based on price‑to‑net asset value
(“NAV”), cash flow multiple/growth ratios and a dividend discount model (“DDM”).
Analysts incorporate both quantitative and qualitative analysis in their NAV,
cash flow, growth and DDM estimates. The company research process includes an
evaluation of the commercial real estate supply and demand dynamics, management,
strategy, property quality, financial strength and corporate structure.
Judgments with respect to risk control, geographic and property sector
diversification, liquidity and other factors are considered along with the
models’ output and drive the portfolio managers’ investment decisions. The Fund
will not seek to achieve specific environmental, social or governance (“ESG”)
outcomes through its portfolio of investments, nor will it pursue an overall
impact or sustainable investment strategy. However, the Advisor may incorporate
consideration of relevant ESG factors into its investment decision-making. For
example, although the Advisor does not generally exclude investments based on
ESG factors alone, when considering an investment opportunity with material
exposure to carbon emissions regulation, this risk may be considered as one
factor in the Advisor’s holistic review
process.
Under normal market conditions, the
Fund invests at least 80%, and normally substantially all, of its total assets
in common stocks and other equity securities issued by real estate
companies. Real estate equity securities include common stocks,
preferred stocks and other equity securities issued by real estate companies,
including real estate investment trusts (“REITs”) and similar REIT-like
entities. A real estate company is one that (i) derives at least 50% of its
revenue from the ownership, construction, financing, management or sale of
commercial, industrial or residential real estate and land; or (ii) has at
least 50% of its assets invested in such real estate. REITs are companies
that own interests in real estate or in real estate related loans or other
interests, and their revenue primarily consists of rent derived from owned,
income producing real estate properties and capital gains from the sale of such
properties. The Fund may invest, without limit, in shares of REITs. A REIT
in the U.S. is generally not taxed on income distributed to shareholders so long
as it meets certain tax related requirements, including the requirement that it
distribute substantially all of its taxable income to such shareholders (other
than net capital gains for each taxable year). REIT-like entities are organized
outside of the U.S. and have operations and receive tax treatment in their
respective countries similar to that of U.S. REITs. The Fund retains the ability
to invest in real estate companies of any market
capitalization.
The
Fund may invest up to 20% of its total assets in securities of foreign issuers
(including emerging market issuers) which meet the same criteria for investment
as domestic companies, including investments in such companies in the form of
American Depositary Receipts (“ADRs”), Global Depositary Receipts (“GDRs”) and
European Depositary Receipts (“EDRs”).
2
PRINCIPAL
RISKS OF INVESTING IN THE FUND
INVESTMENT
RISK
An investment in the Fund is subject to investment risk,
including the possible loss of the entire principal amount that you
invest.
MARKET
RISK
Your
investment in Fund shares represents an indirect investment in the REIT shares
and other securities owned by the Fund. The value of these securities, like
other investments, may move up or down, sometimes rapidly and unpredictably.
Your Fund shares at any point in time may be worth less than what you invested,
even after taking into account the reinvestment of Fund dividends and
distributions.
COMMON
STOCK RISK
The
Fund may invest in common stocks. Common stocks are subject to special risks.
Although common stocks have historically generated higher average returns than
fixed-income securities over the long-term, common stocks also have experienced
significantly more volatility in returns. Common stocks may be more susceptible
to adverse changes in market value due to issuer specific events or general
movements in the equities markets. A drop in the stock market may depress the
price of common stocks held by the Fund. Common stock prices fluctuate for many
reasons, including changes to investors’ perceptions of the financial condition
of an issuer or the general condition of the relevant stock market, or the
occurrence of political or economic events affecting issuers. For example, an
adverse event, such as an unfavorable earnings report, may depress the value of
common stock in which the Fund has invested; the price of common stock of an
issuer may be particularly sensitive to general movements in the stock market;
or a drop in the stock market may depress the price of most or all of the common
stocks held by the Fund. Also, common stock of an issuer in the Fund’s portfolio
may decline in price if the issuer fails to make anticipated dividend payments
because, among other reasons, the issuer of the security experiences a decline
in its financial condition. The common stocks in which the Fund will invest are
typically subordinated to preferred securities, bonds and other debt instruments
in a company’s capital structure in terms of priority to corporate income and
assets, and, therefore, will be subject to greater risk than the preferred
securities or debt instruments of such issuers. In addition, common stock prices
may be sensitive to rising interest rates as the costs of capital rise and
borrowing costs increase.
REAL
ESTATE MARKET RISK
Since
the Fund concentrates its assets in companies engaged in the real estate
industry, your investment in the Fund will be closely linked to the performance
of the real estate markets. Property values may fall due to increasing vacancies
or declining rents resulting from unanticipated economic, legal, cultural or
technological developments. Real estate company prices also may drop because of
the failure of borrowers to pay their loans and poor management, and residential
developers, in particular, could be negatively impacted by falling home prices,
slower mortgage origination and rising construction costs.
REIT
RISK
REITs
generally are dependent upon management skills and may not be diversified. REITs
are also subject to heavy cash flow dependency, defaults by borrowers and
self-liquidation. In addition, REITs could possibly fail to qualify for
favorable tax treatment under applicable tax law. Various factors may also
adversely affect a borrower’s or a lessee’s ability to meet its obligations to
the REIT. In the event of a default by a borrower or lessee, the REIT may
experience delays in enforcing its rights as a mortgagee or lessor and may incur
substantial costs associated with protecting its investments.
3
FOREIGN
(NON-U.S.) SECURITIES
RISK
Risks
of investing in foreign securities, which can be expected to be greater for
investments in emerging markets, include currency risks, future political and
economic developments, including but not limited to, international wars or
conflicts (including Russia’s military invasion of Ukraine), instability in
regions such as Asia, Eastern Europe and the Middle East, terrorism, natural
disasters and public health epidemics (including the outbreak of COVID‑19
globally), and possible imposition of foreign withholding or other taxes on
income or proceeds payable on the securities (including trading and tariff
arrangements and restrictions, sanctions and cybersecurity attacks). In
addition, there may be less publicly available information about a foreign
issuer than about a domestic issuer, and foreign issuers may not be subject to
the same accounting, auditing and financial recordkeeping standards and
requirements as domestic issuers.
SMALL-AND
MEDIUM-SIZED COMPANIES
RISK
Real
estate companies in the industry tend to be small- to medium‑sized companies in
relation to the equity markets as a whole. There may be less trading in a
smaller company’s stock, which means that buy and sell transactions in that
stock could have a larger impact on the stock’s price than is the case with
larger company stocks. Smaller companies also may have fewer lines of business
so that changes in any one line of business may have a greater impact on a
smaller company’s stock price than is the case for a larger company. Further,
smaller company stocks may perform differently in different cycles than larger
company stocks. Accordingly, real estate company shares can, and at times will,
perform differently than large company
stocks.
PREFERRED
SECURITIES RISK
There
are various risks associated with investing in preferred securities. These risks
include deferral and omission of distributions; credit risk; subordination to
bonds and other debt securities in a company’s capital structure; interest rate
risk; prepayment and extension risk; call, reinvestment and income risk;
liquidity risk; limited voting rights; and special redemption rights. In
addition, the COVID‑19 outbreak has increased certain risks associated with
investing in preferred securities. The impact of the COVID‑19 outbreak could
persist for years to come. See “Geopolitical Risk” below for additional
information regarding the COVID‑19
outbreak.
ACTIVE
MANAGEMENT
RISK
As
an actively managed portfolio, the value of the Fund’s investments could decline
because the financial condition of an issuer may change (due to such factors as
management performance, reduced demand or overall market changes), financial
markets may fluctuate or overall prices may decline, or the Advisor’s investment
techniques could fail to achieve the Fund’s investment objective or negatively
affect the Fund’s investment
performance.
NON-DIVERSIFICATION
RISK
As
a “non‑diversified” investment company, the Fund can invest in fewer individual
companies than a diversified investment company. As a result, the Fund is more
susceptible to any single political, regulatory or economic occurrence and to
the financial condition of individual issuers in which it invests. The Fund’s
relative lack of diversity may subject investors to greater risk of loss than a
fund that has a diversified
portfolio.
GEOPOLITICAL
RISK
Occurrence
of global events similar to those in recent years, such as war (including
Russia’s military invasion of Ukraine), terrorist attacks, natural or
environmental disasters, country instability,
4
infectious
disease epidemics or pandemics, such as that caused by COVID‑19, market
instability, debt crises and downgrades, embargoes, tariffs, sanctions and other
trade barriers and other governmental trade or market control programs, the
potential exit of a country from its respective union and related geopolitical
events, may result in market volatility and may have long-lasting impacts on
U.S. and global economies and financial markets. Supply chain disruptions or
significant changes in the supply or prices of commodities or other economic
inputs may have material and unexpected effects on both global securities
markets and individual countries, regions, sectors, companies or industries.
Events occurring in one region of the world may negatively impact industries and
regions that are not otherwise directly impacted by the events. Additionally,
those events, as well as other changes in foreign and domestic political and
economic conditions, could adversely affect individual issuers or related groups
of issuers, securities markets, interest rates, secondary trading, credit
ratings, inflation, investor sentiment and other factors affecting the value of
the Fund’s investments.
Although
the long-term economic fallout of COVID‑19 is difficult to predict, it has
contributed to, and may continue to contribute to, market volatility, inflation
and systemic economic weakness. COVID‑19 and efforts to contain its spread may
also exacerbate other pre‑existing political, social, economic, market and
financial risks. In addition, the U.S. government and other central banks across
Europe, Asia, and elsewhere announced and/or adopted economic relief packages in
response to COVID‑19. The end of any such program could cause market downturns,
disruptions and volatility, particularly if markets view the ending as
premature. The COVID‑19 pandemic and its effects are expected to continue, and
therefore the economic outlook, particularly for certain industries and
businesses, remains inherently
uncertain.
On
January 31, 2020, the United Kingdom (“UK”) withdrew from the European
Union (“EU”) (referred to as Brexit), commencing a transition period that ended
on December 31, 2020. The EU‑UK Trade and Cooperation Agreement, a
bilateral trade and cooperation deal governing the future relationship between
the UK and the EU (“TCA”), provisionally went into effect on January 1,
2021, and entered into force officially on May 1, 2021, but critical
aspects of the relationship remain unresolved and subject to further negotiation
and agreement. Brexit has resulted in volatility in European and global markets
and could have negative long-term impacts on financial markets in the UK and
throughout Europe. There is still considerable uncertainty relating to the
potential consequences of the exit, how the negotiations for new trade
agreements will be conducted, and whether the UK’s exit will increase the
likelihood of other countries also departing the EU. During this period of
uncertainty, the negative impact on the UK, European and broader global
economies, could be significant, potentially resulting in increased market
volatility and illiquidity, political, economic, and legal uncertainty, and
lower economic growth for companies that rely significantly on Europe for their
business activities and revenues.
On
February 24, 2022, Russia launched a large-scale invasion of Ukraine
significantly amplifying already existing geopolitical tensions. The United
States and many other countries have instituted various economic sanctions
against Russia, Russian individuals and entities and Belarus. The extent and
duration of the military action, sanctions imposed and other punitive actions
taken (including any Russian retaliatory responses to such sanctions and
actions), and resulting disruptions in Europe and globally cannot be predicted,
but could be significant and have a severe adverse effect on the global economy,
securities markets and commodities markets globally, including through global
supply chain disruptions, increased inflationary pressures and reduced economic
activity. To the extent the Fund has exposure to the energy sector, the Fund may
be especially susceptible to these risks. Furthermore, in March 2023, the
shut-down of certain financial institutions raised economic concerns over
disruption in the U.S. banking system. There can be no certainty that the
actions taken by the U.S. government to
5
strengthen
public confidence in the U.S. banking system will be effective in mitigating the
effects of financial institution failures on the economy and restoring public
confidence in the U.S. banking system. These disruptions may also make it
difficult to value the Fund’s portfolio investments and cause certain of the
Fund’s investments to become illiquid. The strengthening or weakening of the
U.S. dollar relative to other currencies may, among other things, adversely
affect the Fund’s investments denominated in non‑U.S. dollar currencies. It is
difficult to predict when similar events affecting the U.S. or global financial
markets may occur, the effects that such events may have, and the duration of
those effects.
REGULATORY
RISK
The
U.S. government has proposed and adopted multiple regulations that could have a
long-lasting impact on the Fund and on the mutual fund industry in general. The
SEC’s final rules, related requirements and amendments to modernize reporting
and disclosure, along with other potential upcoming regulations, could, among
other things, restrict the Fund’s ability to engage in transactions, impact
flows into the Fund and/or increase overall expenses of the Fund. In addition to
Rule 18f‑4, which governs the way derivatives are used by registered investment
companies, the SEC, Congress, various exchanges and regulatory and
self-regulatory authorities, both domestic and foreign, have undertaken reviews
of the use of derivatives by registered investment companies, which could affect
the nature and extent of instruments used by the Fund. The Fund and the
instruments in which it invests may be subject to new or additional regulatory
constraints in the future. While the full extent of all of these regulations is
still unclear, these regulations and actions may adversely affect both the Fund
and the instruments in which the Fund invests and its ability to execute its
investment strategy. For example, climate change regulation (such as
decarbonization legislation, other mandatory controls to reduce emissions of
greenhouse gases, or related disclosure requirements) could significantly affect
the Fund or its investments by, among other things, increasing compliance costs
or underlying companies’ operating costs and capital expenditures. Similarly,
regulatory developments in other countries may have an unpredictable and adverse
impact on the Fund.
CYBER
SECURITY
RISK
With
the increased use of technologies such as the Internet and the dependence on
computer systems to perform necessary business functions, the Fund and its
service providers (including the Advisor) may be susceptible to operational and
information security risks resulting from cyber-attacks and/or other
technological malfunctions. In general, cyber-attacks are deliberate, but
unintentional events may have similar effects. Cyber-attacks include, among
others, stealing or corrupting data maintained online or digitally, preventing
legitimate users from accessing information or services on a website, releasing
confidential information without authorization, gaining unauthorized access to
digital systems for purposes of misappropriating assets and causing operational
disruption. Cyber-attacks may also be carried out in a manner that does not
require gaining unauthorized access, such as causing denial‑of‑service.
Successful cyber-attacks against, or security breakdowns of, the Fund, the
Advisor, or a custodian, transfer agent, or other affiliated or third-party
service provider may adversely affect the Fund or its
shareholders.
Each
of the Fund and the Advisor may have limited ability to prevent or mitigate
cyber-attacks or security or technology breakdowns affecting the Fund’s
third-party service providers. While the Fund has established business
continuity plans and systems designed to prevent or reduce the impact of
cyber-attacks, such plans and systems are subject to inherent
limitations.
6
LARGE
SHAREHOLDER
RISK
The
Fund may have one or more large shareholders or a group of shareholders
investing in classes of Fund shares indirectly through an account, platform or
program sponsored by a financial institution. Investment and asset allocation
decisions by such financial institutions regarding the account, platform or
program through which multiple shareholders invest may result in subscription
and redemption decisions that have a significant impact on the assets, expenses
and trading activities of the Fund. Such a decision may cause the Fund to sell
assets (or invest cash) at disadvantageous times or prices, increase or
accelerate taxable gains or transaction costs and may negatively affect the
Fund’s NAV, performance, or ability to satisfy redemptions in a timely
manner.
OTHER
INVESTMENT COMPANIES
RISK
To
the extent the Fund invests a portion of its assets in investment companies,
including open‑end funds, closed‑end funds, exchange-traded funds (“ETFs”) and
other types of pooled investment funds, those assets will be subject to the
risks of the purchased investment funds’ portfolio securities, and a shareholder
in the Fund will bear not only his or her proportionate share of the Fund’s
expenses, but also indirectly the expenses of the purchased investment funds.
Shareholders would therefore be subject to duplicative expenses to the extent
the Fund invests in other investment funds. Risks associated with investments in
closed‑end funds also generally include market risk, leverage risk, risk of
market price discount from NAV, risk of anti-takeover provisions and
non‑diversification risk. In addition, restrictions under the Investment Company
Act of 1940 (the “1940 Act”) may limit the Fund’s ability to invest in other
investment companies to the extent
desired.
The
SEC adopted Rule 12d1‑4, which permits an investment company to invest in other
investment companies beyond the statutory limits, subject to certain conditions,
rescinded certain SEC exemptive orders permitting investments in excess of the
statutory limits and withdrew certain related SEC staff no‑action letters
effective January 19, 2022. Accordingly, an investment company can no
longer rely on the aforementioned exemptive orders and no‑action letters, and is
subject instead to Rule 12d1‑4 and other applicable rules under
Section 12(d)(1), which could affect the Fund’s ability to redeem its
investments in other investment companies, make such investments less
attractive, cause the Fund to incur losses, realize taxable gains distributable
to shareholders, incur greater or unexpected expenses or experience other
adverse consequences.
Your investment in the Fund is not a deposit of any
bank and is not insured or guaranteed by the Federal Deposit Insurance
Corporation or any other government agency.
FUND
PERFORMANCE
The following
bar chart and table provide some indication of the risks of investing in the
Fund. The bar chart shows changes in the Fund’s performance from year to year.
The table shows how the Fund’s average annual returns compare with the
performance of a selected broad-based market index, the S&P 500® Index, over various time
periods. The S&P 500 Index is an unmanaged index of common
stocks that is frequently used as a general measure of U.S. stock market
performance. In addition to the
broad-based market index, the table shows performance of a linked benchmark (the
“Linked Benchmark”). The Linked Benchmark is represented by the performance of
the FTSE Nareit Equity REITs Index through March 31, 2019 and the FTSE
Nareit All Equity REITs Index thereafter. The FTSE Nareit Equity REITs Index
contains all tax‑qualified real estate investment trusts (REITs) except timber
and infrastructure REITs with more than 50% of total assets in qualifying real
estate assets other than mortgages secured by real property that also meet
minimum size and liquidity criteria. The FTSE Nareit All Equity REITs Index
contains all tax‑qualified REITs with more than 50% of total assets
in
7
qualifying real estate assets
other than mortgages secured by real property that also meet minimum size and
liquidity criteria. The Advisor believes that this index, as compared to the
broad-based market index, is comprised of securities that are more
representative of the Fund’s investment strategy.
Past performance (both before and
after taxes) is not, however, an indication as to how the Fund may perform in
the future. Absent any applicable fee waivers and/or expense
limitation, performance would have been lower. Updated performance information,
including the Fund’s NAV per share, is available at www.cohenandsteers.com
or by calling (800)
330‑7348.
Cohen &
Steers Institutional Realty Shares,
Inc.
Annual
Total Returns
Highest quarterly return
during this period: 17.15% (quarter ended March 31,
2019)
Lowest quarterly return
during this period: –22.80% (quarter ended March 31,
2020)
Average
Annual Total Returns
(for
the periods ended December 31, 2022)
|
|
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| |
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|
1 Year |
|
|
5 Years |
|
|
10 Years |
|
Return
Before Taxes |
|
|
(24.73 |
)% |
|
|
5.94% |
|
|
|
7.97% |
|
Return
After Taxes on Distributions |
|
|
(25.65 |
)% |
|
|
4.09% |
|
|
|
5.66% |
|
Return
After Taxes on Distributions and Sale of Fund Shares |
|
|
(14.12 |
)% |
|
|
4.23% |
|
|
|
5.69% |
|
Linked
Benchmark (reflects no deduction for fees, expenses or taxes) |
|
|
(24.95 |
)% |
|
|
4.16% |
|
|
|
6.78% |
|
S&P
500® Index
(reflects no deduction for fees, expenses or taxes) |
|
|
(18.11 |
)% |
|
|
9.43% |
|
|
|
12.56% |
|
After‑tax returns are
calculated using the historical highest individual federal marginal income tax
rates, and do not reflect the impact of state and local taxes.
Actual after‑tax returns
depend on the investor’s tax situation and may differ from those shown, and the
after‑tax returns shown are not relevant to investors who hold their shares
through tax‑advantaged arrangements such as 401(k) plans or individual
retirement accounts.
INVESTMENT
MANAGEMENT
ADVISOR
Cohen &
Steers Capital Management, Inc.
8
PORTFOLIO
MANAGERS
The
Fund’s portfolio managers are:
· |
|
Jon Cheigh—Chief Investment Officer and
Executive Vice President of the Advisor. Mr. Cheigh has been a
portfolio manager of the Fund since 2007. |
· |
|
Jason Yablon—Executive Vice President of
the Advisor. Mr. Yablon has been a portfolio manager of the Fund
since 2013. |
· |
|
Mathew Kirschner—Senior Vice President of
the Advisor. Mr. Kirschner has been a portfolio manager of the Fund
since 2020. |
PURCHASE
AND SALE OF FUND SHARES
You
may open an account with the Fund with a minimum investment of $1,000,000
(aggregate for registered advisors). Additional investments must be at least
$10,000. The Fund reserves the right to waive or change its minimum investment
requirements.
You
may purchase, redeem or exchange shares of the Fund on any business day, which
is any day the New York Stock Exchange (“NYSE”) is open for business, by written
request, wire transfer (call (800) 437‑9912 for instructions) or telephone.
You may purchase, redeem or exchange shares of the Fund either through a
financial intermediary or directly through Cohen & Steers Securities,
LLC, the Fund’s distributor (the “Distributor”). For accounts opened directly
through the Distributor, a completed and signed Subscription Agreement is
required for the initial account opened with the Fund.
Please
mail the signed Subscription Agreement to:
Cohen &
Steers Funds
P.O.
Box 219953
Kansas
City, MO 64121-9953
Phone:
(800) 437‑9912
TAX
INFORMATION
The
Fund’s distributions may be comprised of taxable ordinary income, taxable
capital gains and/or a non‑taxable return of capital, unless you are investing
through a tax‑advantaged arrangement, such as a 401(k) plan or an individual
retirement account.
PAYMENTS
TO BROKER-DEALERS AND OTHER FINANCIAL INTERMEDIARIES
If
you purchase shares of the Fund through a broker-dealer or other financial
intermediary (such as a bank), the Fund and/or its Advisor or Distributor may
pay the intermediary for the sale of Fund shares and related services. These
payments may create a conflict of interest by influencing the broker-dealer or
other intermediary and your individual financial representative to recommend the
Fund over another investment. Ask your individual financial representative or
visit your financial intermediary’s website for more information.
9
INVESTMENT
OBJECTIVE, PRINCIPAL INVESTMENT STRATEGIES AND RELATED RISKS
OBJECTIVE
The
investment objective of the Fund is total return through investment in real
estate securities. In pursuing its investment objective, the Fund seeks both
capital appreciation and current income. The Fund will concentrate its
investments in the real estate industry. There can be no assurance that the Fund
will achieve its investment objective. The Fund may change its investment
objective without shareholder approval, although it has no current intention to
do so. Shareholders will be provided with at least 60 days’ prior written notice
of any change to the Fund’s investment objective.
PRINCIPAL
INVESTMENT STRATEGIES
The
Advisor adheres to a bottom‑up, relative value investment process when selecting
publicly traded real estate securities. To guide the portfolio construction
process, the Advisor utilizes a proprietary valuation model that quantifies
relative valuation of real estate securities based on price‑to‑NAV, cash flow
multiple/growth ratios and a DDM. Analysts incorporate both quantitative and
qualitative analysis in their NAV, cash flow, growth and DDM estimates. The
company research process includes an evaluation of the commercial real estate
supply and demand dynamics, management, strategy, property quality, financial
strength and corporate structure. Judgments with respect to risk control,
geographic and property sector diversification, liquidity and other factors are
considered along with the models’ output and drive the portfolio managers’
investment decisions. The Fund will not seek to achieve specific ESG outcomes
through its portfolio of investments, nor will it pursue an overall impact or
sustainable investment strategy. However, the Advisor may incorporate
consideration of relevant ESG factors into its investment decision-making. For
example, although the Advisor does not generally exclude investments based on
ESG factors alone, when considering an investment opportunity with material
exposure to carbon emissions regulation, this risk may be considered as one
factor in the Advisor’s holistic review process.
The
following are the Fund’s principal investment strategies. A more detailed
description of the Fund’s investment policies and restrictions and more detailed
information about the Fund’s investments are contained in the Fund’s Statement
of Additional Information (“SAI”).
REAL
ESTATE COMPANIES
For
purposes of the Fund’s investment policies, a real estate company is one
that:
· |
|
derives
at least 50% of its revenues from the ownership, construction, financing,
management or sale of commercial, industrial or residential real estate
and land; or |
· |
|
has
at least 50% of its assets invested in such real
estate. |
Under
normal market conditions, the Fund will invest at least 80%, and normally
substantially all, of its total assets in a portfolio of equity securities
issued by real estate companies (including REITs and REIT-like
entities).
The
equity securities in which the Fund
invests can consist of:
· |
|
rights
or warrants to purchase common stocks; |
10
· |
|
securities
convertible into common stocks where the conversion feature represents, in
the Advisor’s view, a significant element of the securities’
value; |
· |
|
private
investments in public equity (“PIPEs”);
and |
· |
|
real
estate private placements. |
REAL
ESTATE INVESTMENT
TRUSTS
REITs
are companies that own interests in real estate or in real estate related loans
or other interests, and their revenue primarily consists of rent derived from
owned, income producing real estate properties and capital gains from the sale
of such properties. The Fund may invest, without limit, in shares of
REITs. A REIT in the U.S. is generally not taxed on income distributed to
shareholders so long as it meets certain tax related requirements, including the
requirement that it distribute substantially all of its taxable income to such
shareholders (other than net capital gains for each taxable year). As a result,
U.S. REITs tend to pay relatively higher dividends than other types of
companies. Dividends paid by U.S. REITs generally will not be eligible for the
dividends-received deduction, and are generally not considered “qualified
dividend income” (“QDI”) eligible for reduced rates of taxation for U.S. federal
income tax purposes but may be considered to be “qualified REIT dividends”
eligible for a 20% deduction for non‑corporate taxpayers. Between 2018 and 2025,
“qualified REIT dividends” are treated as eligible for a 20% deduction by
non‑corporate taxpayers. Qualified REIT dividends are dividends received from
REITs that are neither capital gain dividends nor are eligible for treatment as
QDI, and with respect to which the REIT shareholder meets certain other
requirements. The Fund is permitted to pass through qualified REIT dividends to
its shareholders, provided the shareholders meet certain holding period and
other requirements with respect to their shares. See “Additional Information—Tax
Considerations” in this Prospectus and “Taxation” in the SAI.
REITs
can generally be classified as equity REITs or mortgage REITs. Equity REITs,
which invest the majority of their assets directly in real property, derive
their income primarily from rents. Equity REITs can also realize capital gains
by selling properties that have appreciated in value. Mortgage REITs, which
invest the majority of their assets in real estate mortgages, derive their
income primarily from interest payments. The Fund invests primarily in equity
REITs.
FOREIGN
(NON-U.S.) SECURITIES AND
DEPOSITARY RECEIPTS
The
Fund may invest up to 20% of its total assets in securities of non-U.S. real
estate companies, including investments in such companies in the form of ADRs,
GDRs and EDRs. Generally, ADRs in registered form are dollar-denominated
securities designed for use in the U.S. securities markets, which represent and
may be converted into an underlying foreign security. GDRs, in bearer form, are
designed for use outside the United States. EDRs, in bearer form, are designed
for use in the European securities markets. The Fund may invest in foreign
issuers in both developed and emerging markets.
PREFERRED
STOCKS
The
Fund may invest in preferred stocks. Preferred stocks are securities that pay
dividends at a specified rate and have a preference over common stocks in the
payment of dividends and the liquidation of assets. This means that a company
must pay dividends on its preferred stock prior to paying dividends on its
common stock. In addition, in the event a company is liquidated, preferred
shareholders must be fully repaid on their investments before common
shareholders can receive any money from the company. Preferred shareholders,
however, usually have no right to vote for a company’s directors or on other
corporate matters. Preferred stocks pay a fixed stream of income to investors,
and this income
11
stream
is a primary source of the long-term investment return on preferred stocks. As a
result, the market value of preferred stocks is generally more sensitive to
changes in interest rates than the market value of common stocks. In this
respect, preferred stocks share many investment characteristics with debt
securities.
INVESTMENT
RESTRICTIONS
Except
as otherwise stated, all percentage restrictions referenced in this Prospectus
or the SAI are measured at the time of investment. If a percentage restriction
is adhered to at the time a transaction is effected, a later increase or
decrease in such percentage resulting from market movements will not be
considered a violation of the restriction.
PRINCIPAL
RISKS OF INVESTING IN THE FUND
This
section contains a discussion of the general risks of investing in the Fund. As
with any fund, there can be no guarantee that the Fund will meet its investment
objective or that the Fund’s performance will be positive for any period of
time. An investment in the Fund is not a deposit in any bank and is not insured
or guaranteed by the Federal Deposit Insurance Corporation or by any bank or
governmental agency.
INVESTMENT
RISK
An
investment in the Fund is subject to investment risk, including the possible
loss of the entire principal amount that you invest.
MARKET
RISK
Your
investment in Fund shares represents an indirect investment in the REIT shares
and other securities owned by the Fund. The value of these securities, like
other investments, may move up or down, sometimes rapidly and unpredictably.
Your Fund shares at any point in time may be worth less than what you invested,
even after taking into account the reinvestment of Fund dividends and
distributions.
COMMON
STOCK RISK
The
Fund may invest in common stocks. Common stocks are subject to special risks.
Although common stocks have historically generated higher average returns than
fixed-income securities over the long-term, common stocks also have experienced
significantly more volatility in returns. Common stocks may be more susceptible
to adverse changes in market value due to issuer specific events or general
movements in the equities markets. A drop in the stock market may depress the
price of common stocks held by the Fund. Common stock prices fluctuate for many
reasons, including changes to investors’ perceptions of the financial condition
of an issuer or the general condition of the relevant stock market, or the
occurrence of political or economic events affecting issuers. For example, an
adverse event, such as an unfavorable earnings report, may depress the value of
common stock in which the Fund has invested; the price of common stock of an
issuer may be particularly sensitive to general movements in the stock market;
or a drop in the stock market may depress the price of most or all of the common
stocks held by the Fund. Also, common stock of an issuer in the Fund’s portfolio
may decline in price if the issuer fails to make anticipated dividend payments
because, among other reasons, the issuer of the security experiences a decline
in its financial condition. The common stocks in which the Fund will invest are
typically subordinated to preferred securities, bonds and other debt instruments
in a company’s capital structure in terms of priority to corporate income and
assets, and, therefore, will be subject to greater risk than the preferred
securities or debt instruments of such issuers. In addition, common stock prices
may be sensitive to rising interest rates as the costs of capital rise and
borrowing costs increase.
12
REAL
ESTATE MARKET RISK
The
Fund will not invest in real estate directly, but will invest in securities
issued by real estate companies. However, because of its policy of concentration
in the securities of companies in the real estate industry, the Fund is also
subject to the risks associated with the direct ownership of real
estate.
These
risks include:
· |
|
declines
in the value of real estate; |
· |
|
risks
related to general and local economic
conditions; |
· |
|
possible
lack of availability of mortgage funds; |
· |
|
extended
vacancies of properties; |
· |
|
increases
in property taxes and operating expenses; |
· |
|
changes
in zoning laws; |
· |
|
losses
due to costs resulting from the clean‑up of environmental
problems; |
· |
|
liability
to third parties for damages resulting from environmental
problems; |
· |
|
casualty
or condemnation losses; |
· |
|
changes
in neighborhood values and the appeal of properties to
tenants; |
· |
|
changes
in interest rates; |
· |
|
failure
of borrowers to pay their loans; |
· |
|
early
payment or restructuring of mortgage
loans; |
· |
|
slower
mortgage origination; and |
· |
|
rising
construction costs. |
Thus,
the value of the Fund’s shares may change at different rates compared to the
value of shares of a mutual fund with investments in a mix of different
industries. See also “Principal Risks of Investing in the
Fund—Non‑Diversification Risk”.
REIT
RISK
In
addition to the risks of securities linked to the real estate industry, REITs
are subject to certain other risks related to their structure and focus. REITs
generally are dependent upon management skills and may not be diversified. REITs
are also subject to heavy cash flow dependency, defaults by borrowers and
self-liquidation. In addition, REITs could possibly fail to (i) qualify for
favorable tax treatment under applicable tax law, or (ii) maintain their
exemptions from registration under the 1940 Act. The above factors may also
adversely affect a borrower’s or a lessee’s ability to meet its obligations to
the REIT. In the event of a default by a borrower or lessee, the REIT may
experience delays in enforcing its rights as a mortgagee or lessor and may incur
substantial costs associated with protecting its investments.
13
FOREIGN
(NON-U.S.) SECURITIES
RISK
Investing
in foreign securities involves certain risks not involved in domestic
investments, including, but not limited to:
· |
|
foreign
economic, financial, political and social developments, such as,
international wars or conflicts (including Russia’s military invasion of
Ukraine), instability in regions such as Asia, Eastern Europe and the
Middle East, terrorism, natural disasters and public health epidemics
(including the outbreak of COVID‑19
globally); |
· |
|
different
legal systems; |
· |
|
the
possible imposition of exchange controls or other foreign governmental
laws or restrictions; |
· |
|
less
governmental supervision; |
· |
|
less
publicly available information about foreign companies due to less
rigorous disclosure and accounting standards or regulatory
practices; |
· |
|
high
and volatile rates of inflation; |
· |
|
foreign
currency devaluation; |
· |
|
fluctuating
interest rates; and |
· |
|
different
accounting, auditing and financial record-keeping standards and
requirements. |
Investments
in foreign securities, especially in emerging market countries, will expose the
Fund to the direct or indirect consequences of political, social or economic
changes in the countries that issue the securities or in which the issuers are
located. Political developments in foreign countries or the United States may at
times subject such countries to sanctions from the U.S. government, foreign
governments and/or international institutions that could negatively affect the
Fund’s investments in issuers located in, doing business in or with assets in
such countries. Certain countries in which the Fund may invest, especially
emerging market countries, have historically experienced, and may continue to
experience, high rates of inflation, high interest rates, exchange rate
fluctuations, large amounts of external debt, balance of payments and trade
difficulties and extreme poverty and unemployment. Many of these countries are
also characterized by political uncertainty and instability. The cost of
servicing external debt will generally be adversely affected by rising
international interest rates because many external debt obligations bear
interest at rates which are adjusted based upon international interest rates. In
addition, with respect to certain foreign countries, there is a risk
of:
· |
|
the
possibility of expropriation of assets; |
· |
|
difficulty
in obtaining or enforcing a court
judgment; |
· |
|
economic,
political or social instability; and |
· |
|
diplomatic
developments that could affect investments in those
countries. |
In
addition, individual foreign economies may differ favorably or unfavorably from
the U.S. economy in such respects as:
· |
|
growth
of gross domestic product; |
14
· |
|
balance
of payments position. |
To
the extent the Fund’s investments are focused in a geographic region or country,
the Fund will be subject, to a greater extent than if the Fund’s assets were
less geographically focused, to the risks of adverse changes in that region or
country. In addition, certain investments in foreign securities also may be
subject to foreign withholding or other taxes, which would reduce the Fund’s
return on those securities.
Certain
non‑U.S. real estate companies in which the Fund invests may constitute “passive
foreign investment companies.” See “Taxation” in the SAI. This may subject the
Fund to U.S. federal tax and interest charges, or may cause the Fund to
recognize taxable income without a corresponding receipt of cash. The Fund may
be required to liquidate other investments (including when it is not
advantageous to do so) to meet its distribution requirements for qualification
as a “regulated investment company” (“RIC”).
SMALL-AND
MEDIUM-SIZED COMPANIES
RISK
Real
estate companies in the industry tend to be small- to medium‑sized companies in
relation to the equity markets as a whole. There may be less trading in a
smaller company’s stock, which means that buy and sell transactions in that
stock could have a larger impact on the stock’s price than is the case with
larger company stocks. Smaller companies also may have fewer lines of business
so that changes in any one line of business may have a greater impact on a
smaller company’s stock price than is the case for a larger company. Further,
smaller company stocks may perform differently in different cycles than larger
company stocks. Accordingly, real estate company shares can, and at times will,
perform differently than large company stocks.
PREFERRED
SECURITIES RISK
There
are various risks associated with investing in preferred securities. These risks
include deferral and omission of distributions; credit risk; subordination to
bonds and other debt securities in a company’s capital structure; interest rate
risk; prepayment and extension risk; call, reinvestment and income risk;
liquidity risk; limited voting rights; special redemption rights and regulatory
risk. In addition, the COVID‑19 outbreak has increased certain risks associated
with investing in preferred securities. The impact of the COVID‑19 outbreak
could persist for years to come. See “Geopolitical Risk” below for additional
information regarding the COVID‑19 outbreak.
· |
|
Deferral and Omission Risk. Preferred
securities may include provisions that permit the issuer, at its
discretion, to defer or omit distributions for a stated period without any
adverse consequences to the issuer. In certain cases, deferring or
omitting distributions may be mandatory. If the Fund owns a preferred
security that is deferring its distributions, the Fund may be required to
report income for tax purposes although it has not yet received such
income. In addition, recent changes in bank regulations may increase the
likelihood for issuers to defer or omit
distributions. |
· |
|
Credit and Subordination Risk. Credit
risk is the risk that a preferred security in the Fund’s portfolio will
decline in price or the issuer of the security will fail to make dividend,
interest or principal payments when due because the issuer experiences a
decline in its financial status. Preferred securities are generally
subordinated to bonds and other debt instruments in a company’s capital
structure in terms of having priority to corporate income, claims to
corporate assets and liquidation payments, and therefore will be subject
to greater credit risk than more senior debt
instruments. |
15
· |
|
Interest Rate Risk. Interest rate risk
is the risk that preferred securities will decline in value because of
changes in market interest rates. When market interest rates rise, the
market value of such securities generally will fall, and therefore the
Fund may underperform during periods of rising interest rates. Interest
rates may change frequently and drastically as a result of various
factors, including unexpected shifts in the domestic or global economy (or
expectations that domestic or global economic policies will change). The
Fund may be subject to a greater risk of rising interest rates than it
would normally be given the current market environment. Preferred
securities with longer periods before maturity may be more sensitive to
interest rate changes. |
· |
|
Prepayment and Extension Risk.
Prepayment risk is the risk that changes in interest rates, credit spreads
or other factors will result in the call (repayment) of a preferred
security more quickly than expected, such that the Fund may have to invest
the proceeds in lower yielding securities, or that expectations of such
early call will negatively impact the market price of the security.
Extension risk is the risk that changes in the interest rates or credit
spreads may result in diminishing call expectations, which can cause
prices to fall. |
· |
|
Call, Reinvestment and Income Risk.
During periods of declining interest rates, an issuer may be able to
exercise an option to redeem its issue at par earlier than scheduled which
is generally known as call risk. Recent regulatory changes may increase
call risk with respect to certain types of preferred securities. If this
occurs, the Fund may be forced to reinvest in lower yielding securities.
This is known as reinvestment risk. Preferred securities frequently have
call features that allow the issuer to repurchase the security prior to
its stated maturity. An issuer may redeem preferred securities if the
issuer can refinance the preferred securities at a lower cost due to
declining interest rates or an improvement in the credit standing of the
issuer, or in the event of regulatory changes affecting the capital
treatment of a security. Another risk associated with a declining interest
rate environment is that the income from the Fund’s portfolio may decline
over time when the Fund invests the proceeds from new share sales at
market rates that are below the portfolio’s current earnings
rate. |
· |
|
Liquidity Risk. Certain preferred
securities may be substantially less liquid than many other securities,
such as common stocks or U.S. government securities. Illiquid securities
involve the risk that the securities will not be able to be sold at the
time desired by the Fund or at prices approximating the value at which the
Fund is carrying the securities on its books. During periods of high
volatility, the Fund may experience increased redemptions, requiring it to
liquidate securities when it is difficult to do
so. |
· |
|
Limited Voting Rights Risk. Generally,
traditional preferred securities offer no voting rights with respect to
the issuer unless preferred dividends have been in arrears for a specified
number of periods, at which time the preferred security holders may elect
a number of directors to the issuer’s board of directors. Generally, once
all the arrearages have been paid, the preferred security holders no
longer have voting rights. Hybrid-preferred security holders generally
have no voting rights. |
· |
|
Special Redemption Rights. In certain
varying circumstances, an issuer of preferred securities may redeem the
securities prior to a specified date. For instance, for certain types of
preferred securities, a redemption may be triggered by a change in U.S.
federal income tax or securities laws. As with call provisions, a
redemption by the issuer may have a negative impact on the return of the
security held by the Fund. See “Call, Reinvestment and Income Risk” above
and “Regulatory Risk” below. |
· |
|
New Types of Securities. From time to
time, preferred securities, including hybrid-preferred securities, have
been, and may in the future be, offered having features other than those
described herein. The Fund reserves the right to invest in these
securities if the Advisor believes that doing so would be consistent with
the Fund’s investment objective and policies. Since the market for
these |
16
|
instruments
would be new, the Fund may have difficulty disposing of them at a suitable
price and time. In addition to limited liquidity, these instruments may
present other risks, such as high price
volatility. |
ACTIVE
MANAGEMENT RISK
As
an actively managed portfolio, the value of the Fund’s investments could decline
because the financial condition of an issuer may change (due to such factors as
management performance, reduced demand or overall market changes), financial
markets may fluctuate or overall prices may decline, or the Advisor’s investment
techniques could fail to achieve the Fund’s investment objective or negatively
affect the Fund’s investment performance.
NON-DIVERSIFICATION
RISK
As
a “non‑diversified” investment company, the Fund can invest in fewer individual
companies than a diversified investment company. As a result, the Fund is more
susceptible to any single political, regulatory or economic occurrence and to
the financial condition of individual issuers in which it invests. The Fund’s
relative lack of diversity may subject investors to greater risk of loss than a
fund that has a diversified portfolio.
GEOPOLITICAL
RISK
Occurrence
of global events similar to those in recent years, such as war (including
Russia’s military invasion of Ukraine), terrorist attacks, natural or
environmental disasters, country instability, infectious disease epidemics or
pandemics, such as that caused by COVID‑19, market instability, debt crises and
downgrades, embargoes, tariffs, sanctions and other trade barriers and other
governmental trade or market control programs, the potential exit of a country
from its respective union and related geopolitical events, may result in market
volatility and may have long-lasting impacts on U.S. and global economies and
financial markets. Supply chain disruptions or significant changes in the supply
or prices of commodities or other economic inputs may have material and
unexpected effects on both global securities markets and individual countries,
regions, sectors, companies or industries. Events occurring in one region of the
world may negatively impact industries and regions that are not otherwise
directly impacted by the events. Additionally, those events, as well as other
changes in foreign and domestic political and economic conditions, could
adversely affect individual issuers or related groups of issuers, securities
markets, interest rates, secondary trading, credit ratings, inflation, investor
sentiment and other factors affecting the value of the Fund’s
investments.
Although
the long-term economic fallout of COVID‑19 is difficult to predict, it has
contributed to, and may continue to contribute to, market volatility, inflation
and systemic economic weakness. COVID‑19 and efforts to contain its spread may
also exacerbate other pre‑existing political, social, economic, market and
financial risks. In addition, the U.S. government and other central banks across
Europe, Asia, and elsewhere announced and/or adopted economic relief packages in
response to COVID‑19. The end of any such program could cause market downturns,
disruptions and volatility, particularly if markets view the ending as
premature. The COVID‑19 pandemic and its effects are expected to continue, and
therefore the economic outlook, particularly for certain industries and
businesses, remains inherently uncertain.
On
January 31, 2020, the UK withdrew from the EU (referred to as Brexit),
commencing a transition period that ended on December 31, 2020. The TCA
provisionally went into effect on January 1, 2021, and entered into force
officially on May 1, 2021, but critical aspects of the relationship remain
unresolved and subject to further negotiation and agreement. Brexit has resulted
in volatility in European and global markets and could have negative long-term
impacts on financial markets in the UK and throughout Europe. There is still
considerable uncertainty relating to the potential
17
consequences
of the exit, how the negotiations for new trade agreements will be conducted,
and whether the UK’s exit will increase the likelihood of other countries also
departing the EU. During this period of uncertainty, the negative impact on the
UK, European and broader global economies, could be significant, potentially
resulting in increased market volatility and illiquidity, political, economic,
and legal uncertainty, and lower economic growth for companies that rely
significantly on Europe for their business activities and revenues.
On
February 24, 2022, Russia launched a large-scale invasion of Ukraine
significantly amplifying already existing geopolitical tensions. The United
States and many other countries have instituted various economic sanctions
against Russia, Russian individuals and entities and Belarus. The extent and
duration of the military action, sanctions imposed and other punitive actions
taken (including any Russian retaliatory responses to such sanctions and
actions), and resulting disruptions in Europe and globally cannot be predicted,
but could be significant and have a severe adverse effect on the global economy,
securities markets and commodities markets globally, including through global
supply chain disruptions, increased inflationary pressures and reduced economic
activity. To the extent the Fund has exposure to the energy sector, the Fund may
be especially susceptible to these risks. Furthermore, in March 2023, the
shut-down of certain financial institutions raised economic concerns over
disruption in the U.S. banking system. There can be no certainty that the
actions taken by the U.S. government to strengthen public confidence in the U.S.
banking system will be effective in mitigating the effects of financial
institution failures on the economy and restoring public confidence in the U.S.
banking system. These disruptions may also make it difficult to value the Fund’s
portfolio investments and cause certain of the Fund’s investments to become
illiquid. The strengthening or weakening of the U.S. dollar relative to other
currencies may, among other things, adversely affect the Fund’s investments
denominated in non‑U.S. dollar currencies. It is difficult to predict when
similar events affecting the U.S. or global financial markets may occur, the
effects that such events may have, and the duration of those
effects.
REGULATORY
RISK
The
U.S. government has proposed and adopted multiple regulations that could have a
long-lasting impact on the Fund and on the mutual fund industry in general. The
SEC’s final rules, related requirements and amendments to modernize reporting
and disclosure, along with other potential upcoming regulations, could, among
other things, restrict the Fund’s ability to engage in transactions, impact
flows into the Fund and/or increase overall expenses of the Fund. In addition to
Rule 18f‑4, which governs the way derivatives are used by registered investment
companies, the SEC, Congress, various exchanges and regulatory and
self-regulatory authorities, both domestic and foreign, have undertaken reviews
of the use of derivatives by registered investment companies, which could affect
the nature and extent of instruments used by the Fund. The Fund and the
instruments in which it invests may be subject to new or additional regulatory
constraints in the future. While the full extent of all of these regulations is
still unclear, these regulations and actions may adversely affect both the Fund
and the instruments in which the Fund invests and its ability to execute its
investment strategy. For example, climate change regulation (such as
decarbonization legislation, other mandatory controls to reduce emissions of
greenhouse gases, or related disclosure requirements) could significantly affect
the Fund or its investments by, among other things, increasing compliance costs
or underlying companies’ operating costs and capital expenditures. Similarly,
regulatory developments in other countries may have an unpredictable and adverse
impact on the Fund.
CYBER
SECURITY RISK
With
the increased use of technologies such as the Internet and the dependence on
computer systems to perform necessary business functions, the Fund and its
service providers (including the Advisor)
18
may
be susceptible to operational and information security risks resulting from
cyber-attacks and/or other technological malfunctions. In general, cyber-attacks
are deliberate, but unintentional events may have similar effects. Cyber-attacks
include, among others, stealing or corrupting data maintained online or
digitally, preventing legitimate users from accessing information or services on
a website, releasing confidential information without authorization, gaining
unauthorized access to digital systems for purposes of misappropriating assets
and causing operational disruption. Cyber-attacks may also be carried out in a
manner that does not require gaining unauthorized access, such as causing
denial‑of‑service. Successful cyber-attacks against, or security breakdowns of,
the Fund, the Advisor, or a custodian, transfer agent, or other affiliated or
third-party service provider may adversely affect the Fund or its shareholders.
For instance, cyber-attacks may interfere with the processing of shareholder
transactions, affect the Fund’s ability to calculate its NAV, cause the release
of private shareholder information or confidential Fund information, impede
trading, cause reputational damage, and subject the Fund to regulatory fines,
penalties or financial losses, reimbursement or other compensation costs, and
additional compliance costs. Furthermore, as a result of breaches in cyber
security or other operational and technology disruptions or failures, an
exchange or market may close or issue trading halts on specific securities or an
entire market, which may result in a Fund being, among other things, unable to
buy or sell certain securities or financial instruments or unable to accurately
price its investments. While the Fund has established business continuity plans
and systems designed to prevent cyber-attacks, there are inherent limitations in
such plans and systems including the possibility that certain risks have not
been identified. Similar types of cyber security risks also are present for
issuers of securities in which the Fund invests, which could result in material
adverse consequences for such issuers, and may cause the Fund’s investment in
such securities to lose value.
Each
of the Fund and the Advisor may have limited ability to prevent or mitigate
cyber-attacks or security or technology breakdowns affecting each Fund’s
third-party service providers. While the Fund has established business
continuity plans and systems designed to prevent or reduce the impact of
cyber-attacks, such plans and systems are subject to inherent
limitations.
LARGE
SHAREHOLDER RISK
The
Fund may have one or more large shareholders or a group of shareholders
investing in classes of Fund shares indirectly through an account, platform or
program sponsored by a financial institution. Investment and asset allocation
decisions by such financial institutions regarding the account, platform or
program through which multiple shareholders invest may result in subscription
and redemption decisions that have a significant impact on the assets, expenses
and trading activities of the Fund. Such a decision may cause the Fund to sell
assets (or invest cash) at disadvantageous times or prices, increase or
accelerate taxable gains or transaction costs and may negatively affect the
Fund’s NAV, performance, or ability to satisfy redemptions in a timely
manner.
OTHER
INVESTMENT COMPANIES
RISK
To
the extent the Fund invests a portion of its assets in investment companies,
including open‑end funds, closed‑end funds, ETFs and other types of pooled
investment funds, those assets will be subject to the risks of the purchased
investment funds’ portfolio securities, and a shareholder in the Fund will bear
not only his or her proportionate share of the Fund’s expenses, but also
indirectly the expenses of the purchased investment funds. Shareholders would
therefore be subject to duplicative expenses to the extent the Fund invests in
other investment funds. Risks associated with investments in closed‑end funds
also generally include market risk, leverage risk, risk of market price discount
from NAV, risk of anti-takeover provisions and non‑diversification risk. In
addition, restrictions under the 1940 Act may limit the Fund’s ability to invest
in other investment companies to the extent desired.
19
The
SEC adopted Rule 12d1‑4, which permits an investment company to invest in other
investment companies beyond the statutory limits, subject to certain conditions,
rescinded certain SEC exemptive orders permitting investments in excess of the
statutory limits and withdrew certain related SEC staff no‑action letters
effective January 19, 2022. Accordingly, an investment company can no
longer rely on the aforementioned exemptive orders and no‑action letters, and is
subject instead to Rule 12d1‑4 and other applicable rules under
Section 12(d)(1), which could affect the Fund’s ability to redeem its
investments in other investment companies, make such investments less
attractive, cause the Fund to incur losses, realize taxable gains distributable
to shareholders, incur greater or unexpected expenses or experience other
adverse consequences.
ADDITIONAL
INVESTMENT INFORMATION
In
addition to the principal investment strategies described above, the Fund has
other investment practices that are described here and in the SAI. These
investment practices may subject the Fund to additional risks. Please review
this section and the SAI for more information about the additional investment
practices and their associated risks.
ILLIQUID
SECURITIES
Illiquid
investments are generally investments that a Fund cannot reasonably expect to be
sold or disposed of in current market conditions in seven (7) calendar days
or less without the sale or disposition significantly changing the market value
of the instrument. The Fund will not invest more than 15% of its net assets in
illiquid securities. Restricted securities, which are securities that may not be
resold to the public without an effective registration statement under the
Securities Act of 1933, or, if they are unregistered, may be sold only in a
privately negotiated transaction or pursuant to an exemption from registration,
may be illiquid. Such investments may include private investments in public
equity (“PIPEs”) and real estate private placements in which the Fund may
invest.
Pursuant
to Rule 22e‑4 under the 1940 Act, the Fund has adopted a liquidity risk
management program to assess and manage its liquidity risk. Under its program,
the Fund is required to classify its investments into specific liquidity
categories and monitor compliance with limits on investments in illiquid
securities. While the liquidity risk management program attempts to assess and
manage liquidity risk, there is no guarantee it will be effective in its
operation, and it will not reduce the liquidity risk inherent in the Fund’s
investments.
DEFENSIVE
POSITION
When
the Advisor believes that market or general economic conditions justify a
temporary defensive position, the Fund may deviate from its investment objective
and invest all or any portion of its assets in short-term debt instruments,
government securities, cash or cash equivalents. When and to the extent the Fund
assumes a temporary defensive position, it may not pursue or achieve its
investment objective. In addition, the Fund may be required to hold more cash
than anticipated to support its derivative positions, which could have a
negative impact on returns.
PORTFOLIO
HOLDINGS
A
description of the Fund’s policies and procedures with respect to the disclosure
of the Fund’s portfolio securities is available in the Fund’s SAI. The Fund has
filed its complete schedule of portfolio holdings with the SEC. Disclosure of
the Fund’s complete holdings are required to be made monthly on Form N‑PORT,
with every third month made available to the public by the SEC 60 days after the
end of the Fund’s fiscal quarter. The Fund’s Form N‑PORT is available
(i) without charge, upon request, by calling 800‑330‑7348 or (ii) on
the SEC’s website at www.sec.gov. The Fund’s full portfolio holdings
are
20
published
semi-annually in reports sent to shareholders and filed with the SEC on Form
N‑CSR and such reports are made available at www.cohenandsteers.com in the
“Funds” section under “Fund Literature,” generally within 70 days after the end
of each semi-annual period. The Fund also posts an uncertified list of portfolio
holdings on the website, no earlier than 15 days after the end of each calendar
quarter. The holdings information remains available until the Fund files a
publicly available report on Form N‑PORT or Form N‑CSR for the period that
includes the date as of which the information is current. In addition to
information on portfolio holdings, other Fund statistical information may be
found on www.cohenandsteers.com or by calling 800‑330‑7348.
MANAGEMENT
OF THE FUND
THE
ADVISOR
The
Advisor, a registered investment advisor located at 280 Park Avenue, New York,
New York 10017, was formed in 1986 and its clients include pension plans,
endowment funds and investment companies, including each of the open‑end and
closed‑end Cohen & Steers funds. As of March 31, 2023, the Advisor
managed approximately $79.9 billion in assets. The Advisor is a
wholly-owned subsidiary of Cohen & Steers, Inc. (“CNS”), a publicly
traded company whose common stock is listed on the NYSE under the symbol “CNS.”
Under
its investment management agreement (the “Investment Management Agreement”) with
the Fund, the Advisor furnishes a continuous investment program for the Fund’s
portfolio, makes the day‑to‑day investment decisions for the Fund and generally
manages the Fund’s investments in accordance with the stated policies of the
Fund, subject to the general supervision of the Board of Directors of the Fund.
The Advisor also performs certain administrative services for the Fund and
provides persons satisfactory to the Board of Directors of the Fund to serve as
officers of the Fund. Such officers, as well as certain Directors of the Fund,
may also be directors, officers, or employees of the Advisor. The Advisor also
selects brokers and dealers to execute the Fund’s portfolio transactions.
For
its services under the Investment Management Agreement, the Fund pays the
Advisor a monthly investment management fee at the annual rate of 0.75% of the
average daily net assets of the Fund. The Advisor pays all expenses of the Fund
except for brokerage fees and commissions, taxes, interest, fees and expenses of
the independent directors (including fees and expenses of their independent
counsel and other independent consultants), trade organization membership dues,
federal and state registration fees and extraordinary expenses. The Fund’s
effective investment advisory fee during 2022 was 0.74% of average daily net
assets.
The
Advisor has contractually agreed to waive its fee and/or reimburse the Fund so
that total annual Fund operating expenses (excluding brokerage fees and
commissions, taxes, certain other expenses and, upon approval of the Fund’s
Board of Directors, extraordinary expenses), as reflected in the Fund’s
financial statements, never exceed 0.75% of average daily net assets. This
commitment is currently expected to remain in place for the life of the Fund,
can only be amended or terminated by agreement of the Fund’s Board of Directors
and the Advisor, and will terminate automatically in the event of termination of
the Investment Management Agreement between the Fund and the Advisor.
A
discussion regarding the Board of Directors’ basis for approving the Investment
Management Agreement is available in the Fund’s semi-annual report to
shareholders for the period ended June 30, 2022.
21
PORTFOLIO
MANAGERS
The
Fund’s portfolio managers are:
· |
|
Jon Cheigh—Mr. Cheigh joined the
Advisor in 2005 and currently serves as Executive Vice President of the
Advisor, Chief Investment Officer and Head of the Global Real Estate
investment team. He is based in New York. |
· |
|
Jason Yablon—Mr. Yablon joined the
Advisor in 2004 and currently serves as Executive Vice President of the
Advisor and Head of the U.S. Real Estate investment team. He is based in
New York. |
· |
|
Mathew Kirschner – Mr. Kirschner
joined the Advisor in 2004 and currently serves as Senior Vice President
of the Advisor and a member of the U.S. real estate investment team.
Mr. Kirschner is a Chartered Financial Analyst charterholder. He is
based in New York. |
The
Advisor utilizes a team-based approach in managing the Fund. Messrs. Cheigh,
Yablon and Kirschner direct and supervise the execution of the Fund’s investment
strategy.
The
SAI contains additional information about the portfolio managers’ compensation,
other accounts they manage, and their ownership of securities in the Fund.
PRICING
OF FUND SHARES
The
price at which you can purchase and redeem the Fund’s shares is the NAV of the
shares next determined after we receive your order in proper form. Proper form
means that your request includes the Fund name and account number, states the
amount of the transaction (in dollars or shares), includes the signatures of all
owners exactly as registered on the account, signature guarantees (if
necessary), any supporting legal documentation that may be required and any
outstanding certificates representing shares to be redeemed.
The
Fund calculates its NAV per share as of the close of regular trading on the
NYSE, generally 4:00 p.m. eastern time, on each day the NYSE is open for
trading. Thus, purchase or redemption orders must be received in proper form by
the close of regular trading on the NYSE in order to receive that day’s NAV;
orders received after the close of regular trading on the NYSE will receive the
NAV next determined. The Fund has authorized one or more brokers to accept on
its behalf purchase and redemption orders, and these brokers are authorized to
designate other intermediaries on the Fund’s behalf. The Fund will be deemed to
have received a purchase or redemption order when an authorized broker, or that
broker’s designee, accepts the order, and that order will be priced at the next
computed NAV after this acceptance. The Fund determines NAV per share by
dividing the net assets of the Fund (i.e., its assets less liabilities) by the
total number of outstanding shares.
Investments
in securities that are listed on the NYSE are valued, except as indicated below,
at the last sale price reflected at the close of the NYSE on the business day as
of which such value is being determined. If there has been no sale on such day,
the securities are valued at the mean of the closing bid and ask prices on such
day or, if no ask price is available, at the bid price. Futures contracts traded
on an exchange are valued at their settlement price at the close of trading on
their primary exchange. Forward foreign currency contracts are valued daily at
the prevailing forward exchange rate. Exchange-traded options are valued at
their last sale price as of the close of options trading on applicable exchanges
on the valuation date. In the absence of a last sale price on such day, options
are valued at the average of the quoted bid and ask prices as of the close of
business. OTC options are valued based upon prices provided by a third-party
pricing service or counterparty.
22
Securities
not listed on the NYSE but listed on other domestic or foreign securities
exchanges (including NASDAQ) are valued in a similar manner. Securities traded
on more than one securities exchange are valued at the last sale price reflected
at the close of the exchange representing the principal market for such
securities on the business day as of which such value is being determined. If
after the close of a foreign market, but prior to the close of business on the
day the securities are being valued, market conditions change significantly,
certain non‑U.S. equity holdings may be fair valued pursuant to procedures
established by the Board of Directors.
Readily
marketable securities traded in the OTC market, including listed securities
whose primary market is believed by the Advisor to be OTC, are valued on the
basis of prices provided by a third-party pricing service or third-party
broker-dealers when such prices are believed by the Advisor, pursuant to
delegation by the Board of Directors, to reflect the fair value of such
securities.
Fixed-income
securities are valued on the basis of prices provided by a third-party pricing
service or third-party broker-dealers when such prices are believed by the
Advisor, pursuant to delegation by the Board of Directors, to reflect the fair
value of such securities. The pricing services or broker-dealers use multiple
valuation techniques to determine fair value. In instances where sufficient
market activity exists, the pricing services or broker-dealers may utilize a
market-based approach through which quotes from market makers are used to
determine fair value. In instances where sufficient market activity may not
exist or is limited, the pricing services or broker-dealers also utilize
proprietary valuation models which may consider market transactions in
comparable securities and the various relationships between securities in
determining fair value and/or characteristics such as benchmark yield curves,
option-adjusted spreads, credit spreads, estimated default rates, coupon rates,
anticipated timing of principal repayments, underlying collateral, and other
unique security features which are then used to calculate the fair values.
The
Board of Directors has designated the Advisor as the Fund’s “Valuation Designee”
under Rule 2a‑5 under the 1940 Act. As Valuation Designee, the Advisor is
authorized to make fair valuation determinations, subject to the oversight of
the Board of Directors. The Advisor has established a valuation committee
(“Valuation Committee”) to administer, implement and oversee the fair valuation
process according to the policies and procedures approved annually by the Board
of Directors. Among other things, these procedures allow the Fund to utilize
independent pricing services, quotations from securities and financial
instrument dealers and other market sources to determine fair value.
Securities
for which market prices are unavailable, or securities for which the Advisor
determines that the bid and/or ask price or a counterparty valuation does not
reflect market value, will be valued at fair value, as determined in good faith
by the Valuation Committee, pursuant to procedures approved by the Fund’s Board
of Directors. Circumstances in which market prices may be unavailable include,
but are not limited to, when trading in a security is suspended, the exchange on
which the security is traded is subject to an unscheduled close or disruption or
material events occur after the close of the exchange on which the security is
principally traded. In these circumstances, the Fund determines fair value in a
manner that fairly reflects the market value of the security on the valuation
date based on consideration of any information or factors it deems appropriate.
These may include, but are not limited to, recent transactions in comparable
securities, information relating to the specific security and developments in
the markets.
Foreign
equity fair value pricing procedures utilized by the Fund may cause certain
non‑U.S. equity holdings to be fair valued on the basis of fair value factors
provided by a pricing service to reflect any significant market movements
between the time the Fund values such securities and the earlier closing of
foreign markets.
23
The
Fund’s use of fair value pricing may cause the NAV of Fund shares to differ from
the NAV that would be calculated using market quotations. Fair value pricing
involves subjective judgments and it is possible that the fair value determined
for a security may be materially different than the value that could be realized
upon the sale of that security.
Short-term
debt securities, which have a maturity date of 60 days or less, are valued at
amortized cost, which approximates fair value. Investments in open‑end mutual
funds are valued at NAV.
Since
the Fund may hold securities that are primarily listed on foreign exchanges that
trade on weekends or days when the Fund does not price its shares, the value of
securities held in the Fund may change on days when you will not be able to
purchase or redeem Fund shares.
HOW
TO PURCHASE, EXCHANGE AND SELL FUND SHARES
PURCHASE
MINIMUMS
You
may open an account with the Fund with a minimum investment of $1,000,000
(aggregate for registered advisors). Additional investments must be at least
$10,000. The Fund reserves the right to waive or change its minimum investment
requirements.
The
investment minimum is waived for the following:
· |
|
Registered
investment advisors clearing through multiple firms having an aggregate
$1,000,000 or more invested in shares of Cohen & Steers open‑end
funds; |
· |
|
Consultant
firms investing on behalf of underlying investors having aggregate assets
of $1.0 million or more invested in Cohen & Steers open‑end
funds; |
· |
|
Group
retirement plans; and |
· |
|
New
consultant relationships, if the consultant is expected to meet the
investment minimum over time. |
Group
retirement plans include 401(k) plans, 457 plans, employer-sponsored 403(b)
plans, profit-sharing and money purchase pension plans, and defined benefit
plans; non‑qualified deferred compensation plans where plan level or omnibus
accounts are held on the books of a Fund; and employee benefit plans, including
certain health savings accounts. Group retirement plans generally do not include
retail non‑retirement accounts; traditional and Roth individual retirement
accounts, otherwise known as “IRAs;” SIMPLE, SEP or SARSEP plans; Coverdell
Education Savings Accounts; or plans covering self-employed individuals and
their employees (formerly Keogh/H.R. 10 plans).
The
Fund does not accept investments from investors with non‑U.S. addresses and
dealer controlled accounts designated as foreign accounts (“Restricted
Accounts”). Existing Restricted Accounts can remain in the Fund, but are
prohibited from making further investments. U.S. Armed Forces and Diplomatic
post office addresses abroad are treated as U.S. addresses and can invest in the
Fund. Addresses in U.S. territories, such as Guam and Puerto Rico, are also
treated as U.S. addresses and can invest in the Fund.
The
Fund reserves the right to reject or cancel any purchase order and to withdraw
or suspend the offering of shares at any time. In addition, the Fund reserves
the right to waive or change its minimum investment requirements.
To
help the government fight the funding of terrorism and money laundering
activities, federal law requires all financial institutions to obtain, verify
and record information that identifies each person
24
who
opens an account. In some cases, federal law also requires us to verify and
record information that identifies the natural persons who control and
beneficially own a legal entity that opens an account. When you open an account,
the Fund may request additional information to verify your identity including:
names, addresses, dates of birth and other information that will allow us to
identify you and certain other natural persons associated with the account. For
some legal entity accounts, you will be asked to provide identifying information
for one natural person that controls the entity, and for each natural person
that beneficially owns 25% or more of the legal entity.
The
Fund is also required to obtain information that identifies each authorized
signer for an account by requesting the name, residential address, date of birth
and social security number for each of your authorized signers.
If
you do not provide this information or if such information cannot be verified,
we reserve the right to close your account to the extent required or permitted
by applicable law or regulations. If the net asset value per share of the Fund
has decreased since your purchase, you may lose money as a result of this
account closure. You may also incur any applicable sales charge.
HOW
TO PURCHASE FUND SHARES
FORM
OF PAYMENT
We
will accept payment for shares in two forms:
1.
A check drawn on any bank or domestic savings institution. Checks must be
payable in U.S. dollars and will be accepted subject to collection at full face
value.
2.
A bank wire or Federal Reserve wire of federal funds.
PURCHASES
OF FUND SHARES
INITIAL
PURCHASE BY WIRE
1.
Telephone toll free from any continental U.S. state: (800) 437‑9912. When you
contact the Transfer Agent, you will need the following information:
· |
|
name(s)
in which shares are to be registered; |
· |
|
social
security or tax identification number (where applicable);
|
· |
|
dividend
payment election; |
· |
|
name
of the wiring bank; and |
· |
|
name
and telephone number of the person to be contacted in connection with the
order. |
The
Transfer Agent will assign you an account number.
2.
Instruct the wiring bank to transmit at least the required minimum amount (see
“Purchase Minimums” above) to the following:
State
Street Bank and Trust Company
One
Lincoln Street
Boston,
Massachusetts 02111
25
ABA
# 011000028
Account:
DDA # 99055287
Attn:
Cohen & Steers Institutional Realty Shares, Inc.
For
further credit to: (Account Name)
Account
Number: (provided by the Transfer Agent)
3.
Complete the Subscription Agreement attached to this Prospectus and mail the
Subscription Agreement to the Transfer Agent:
Attn:
Cohen & Steers Funds
P.O.
Box 219953
Kansas
City, MO 64121-9953
ADDITIONAL
PURCHASES BY WIRE
1.
Telephone toll free from any continental U.S. state: (800) 437‑9912. When you
contact the Transfer Agent, you will need the following information:
· |
|
name
of the wiring bank; and |
· |
|
name
and telephone number of the person to be contacted in connection with the
order. |
2.
Instruct the wiring bank to transmit at least the required minimum amount (see
“Purchase Minimums” above) to the following:
State
Street Bank and Trust Company
One
Lincoln Street
Boston,
Massachusetts 02111
ABA
# 011000028
Account:
DDA # 99055287
Attn:
Cohen & Steers Institutional Realty Shares, Inc.
For
further credit to: (Account Name)
Account
Number: (provided by the Transfer Agent)
INITIAL
PURCHASE BY MAIL
1.
Complete the Subscription Agreement attached to this Prospectus.
2.
Mail the Subscription Agreement and a check in at least the required minimum
amount (see “Purchase Minimums” above), payable to the Fund, to the Transfer
Agent at the above address.
ADDITIONAL
PURCHASES BY MAIL
1.
Make a check payable to the Fund in at least the required minimum amount (see
“Purchase Minimums” above). Write your Fund account number on the check.
2.
Mail the check and the detachable stub from your account statement (or a letter
providing your account number) to the Transfer Agent at the address set forth
above.
PURCHASES
THROUGH DEALERS AND
INTERMEDIARIES
You
may purchase the Fund’s shares through authorized dealers and other financial
intermediaries.
26
Financial
service firms that do not have a sales agreement with the Distributor also may
place orders for purchases of the Fund’s shares, but may charge you a
transaction fee.
Dealers
and financial service firms are responsible for promptly transmitting purchase
orders to the Distributor. These dealers and financial service firms may also
impose charges for handling transactions placed through them that are in
addition to any other charges described in this Prospectus. Such charges may
include processing or service fees, which are typically fixed dollar amounts.
You should contact your dealer or financial service firm for more information
about any additional charges that may apply.
ADDITIONAL
INFORMATION ON PURCHASE OF FUND SHARES
AUTOMATIC
INVESTMENT PLAN AND
PURCHASES BY ACH
The
Fund’s automatic investment plan (the “Plan”) provides a convenient way to
invest in the Fund. Under the Plan, you can have money transferred automatically
from your checking account to the Fund each month to buy additional shares. If
you are interested in this Plan, please refer to the automatic investment plan
section of the Subscription Agreement attached to this Prospectus or contact
your dealer. The market value of the Fund’s shares may fluctuate, and a
systematic investment plan such as this will not assure a profit or protect
against a loss. You may discontinue the Plan at any time by notifying the Fund
by mail or telephone at the address or number on the back cover of this
Prospectus.
You
may purchase additional shares of the Fund by automated clearing house (“ACH”).
To elect the Auto‑Buy option, select it on your Subscription Agreement attached
to this Prospectus or call the Transfer Agent and request an optional
shareholder services form. ACH is similar to the Plan, except that you may
choose the date on which you want to make the purchase. We will need a voided
check or deposit slip before you may purchase by ACH. If you are interested in
this option, please call (800) 437‑9912.
The
Plan and purchases by ACH may not be available to customers of certain financial
intermediaries. Please contact your dealer or financial service firm for more
information.
EXCHANGE
PRIVILEGE
You
may exchange or convert some or all of your Fund shares for shares of other
Cohen & Steers open‑end funds, provided that you meet applicable
investment minimums.
An
exchange of shares may result in your realizing a taxable gain or loss for
income tax purposes. See “Additional Information—Tax Considerations.” The
exchange privilege is available to shareholders residing in any state in which
the shares being acquired may be legally sold. Before you exercise the exchange
privilege, you should read the prospectus of the fund whose shares you are
acquiring, and all exchanges are subject to any other limits on sales for or
exchanges into that fund. Certain dealers and other financial intermediaries may
limit or prohibit your right to use the exchange privilege and may charge you a
fee for exchange transactions placed through them.
We
have adopted reasonable procedures that are designed to ensure that any
telephonic exchange instructions are genuine. Neither the Fund nor its agents
will be liable for any loss or expenses if we act in accordance with these
procedures. We may modify or suspend telephone
privileges without notice during periods of drastic economic or market
changes. We may modify or revoke the
exchange privilege for all shareholders upon 60 days’ prior written notice and
this privilege may be revoked immediately with respect to any shareholder if the
Fund believes the shareholder is engaged in, or has
27
engaged in, market timing or other abusive trading
practices. For additional information concerning exchanges, or to make an
exchange, please call the Transfer Agent at (800) 437‑9912.
HOW
TO SELL FUND SHARES
You
may sell or redeem your shares through authorized dealers, or other financial
intermediaries or through the Transfer Agent. If your shares are held by your
dealer or intermediary in “street name,” you must redeem your shares through
that dealer or intermediary.
REDEMPTIONS
THROUGH DEALERS AND
OTHER INTERMEDIARIES
If
you have an account with an authorized dealer or other intermediary, you may
submit a redemption request to such dealer or intermediary. They are responsible
for promptly transmitting redemption requests to the Distributor. Dealers and
intermediaries may impose charges for handling redemption transactions placed
through them that are in addition to any other charges described in this
Prospectus. Such charges may include processing or service fees, which are
typically fixed dollar amounts. You should contact your dealer or intermediary
for more information about any additional charges that may apply.
REDEMPTION
BY TELEPHONE
To
redeem shares by telephone, call the Transfer Agent at (800) 437‑9912. In order
to be honored at that day’s price, we must receive any telephone redemption
requests by the close of regular trading on the NYSE that day, generally 4:00
p.m., eastern time. Orders received after the close of regular trading on the
NYSE will receive the NAV next determined.
If
you would like to change your telephone redemption instructions, you must send
the Transfer Agent written notification signed by all of the account’s
registered owners, accompanied by signature guarantee(s), as described below.
We
may modify or suspend telephone redemption privileges without notice during
periods of drastic economic or market changes. We have adopted reasonable
procedures that are designed to ensure that any telephonic redemption
instructions are genuine. Neither the Fund nor its agents will be liable for any
loss or expenses if we act in accordance with these procedures. We may modify or terminate the telephone redemption
privilege at any time on 30 days’ notice to shareholders.
REDEMPTION
BY MAIL
You
can redeem Fund shares by sending a written request for redemption to the
Transfer Agent:
P.O.
Box 219953
Kansas
City, MO 64121-9953
Attn:
Cohen & Steers Institutional Realty Shares, Inc.
A
written redemption request must:
· |
|
state
the number of shares or dollar amount to be redeemed;
|
· |
|
identify
your account number and tax identification number; and
|
· |
|
be
signed by each registered owner exactly as the shares are registered.
|
If
the shares to be redeemed were issued in certificate form, the certificate must
be endorsed for transfer (or be accompanied by a duly executed stock power) and
must be submitted to the Transfer Agent together with a redemption request.
28
For
redemptions made by corporations, executors, administrators or guardians, the
Transfer Agent may require additional supporting documents evidencing the
authority of the person making the redemption (including evidence of appointment
or incumbency). For additional information regarding the specific documentation
required, contact the Transfer Agent at (800) 437‑9912.
The
Transfer Agent will not consider your redemption request to be properly made
until it receives all required documentation in proper form.
OTHER
REDEMPTION INFORMATION
PAYMENT
OF REDEMPTION PROCEEDS
Except
as noted below, the Fund normally sends redemption proceeds to redeeming
shareholders by mailing a check or via electronic transfer ACH within five
business days after a redemption request is received in good order. Redemptions
by wire will normally be sent within two business days. Regardless of the
methods used to pay redemption proceeds, there may be instances where payments
may take up to seven calendar days. When proceeds of redemptions are to be paid
to someone other than the shareholder, either by wire or check, you must send a
letter of instruction and the signature(s) on the letter of instruction must be
guaranteed, as described below, regardless of the amount of the redemption. The
Fund will delay the payment of redemption proceeds, however, if the check used
to purchase the shares to be redeemed has not cleared, which may take up to 15
days or more. The Fund may suspend the right of redemption or postpone the date
of payment if trading is halted or restricted on the NYSE or under other
emergency conditions, including as determined by the SEC or as permitted by the
1940 Act.
The
Fund may establish policies permitting the Fund’s transfer agent to place a
temporary hold for up to 25 business days on the disbursement of redemption
proceeds from an account held directly with the Fund if the transfer agent
reasonably believes that financial exploitation of a Specified Adult (as defined
below) has occurred, is occurring, has been attempted, or will be attempted.
“Specified Adult” refers to an individual who is a natural person (i) age
65 and older, or (ii) age 18 and older and whom the Fund’s transfer agent
reasonably believes has a mental or physical impairment that renders the
individual unable to protect his or her own interests. The transfer agent and/or
the Fund may not be aware of factors suggesting financial exploitation of a
Specified Adult and may not be able to identify Specified Adults in all
circumstances. Furthermore, neither the transfer agent nor the fund is required
to delay the disbursement of redemption proceeds and nor do they assume any
obligation to do so.
Under
normal market conditions, the Fund expects to meet redemption requests by check,
ACH or wire, as described above, through the sale of readily marketable
portfolio securities or using cash on hand. The Fund may also meet all or a
portion of your redemption proceeds with readily marketable portfolio securities
of the Fund transferred into your name (“in‑kind”) in the following
circumstances: (i) if the Advisor believes that stressed economic
conditions exist or (ii) if the Advisor otherwise determines that meeting
redemption requests by selling portfolio securities or using cash on hand would
be detrimental to the best interests of the Fund and remaining shareholders.
In‑kind redemptions generally, but not necessarily, result in a pro rata distribution of each security held in
a Fund’s portfolio. The securities distributed in an in‑kind redemption will be
valued in the same manner as they are valued for purposes of computing the
Fund’s NAV. A redemption is generally a taxable event for shareholders,
regardless of whether the redemption is satisfied in cash or in kind. The
securities distributed are subject to market risk until they are sold and may
increase or decrease in value prior to converting them into cash. You may incur
brokerage and other transaction costs, and could incur a taxable gain or loss
for income tax purposes when converting the securities to cash. The Fund has
elected, however, to be governed by Rule 18f‑1 under the 1940 Act, as a result
of which the Fund is
29
obligated
to redeem shares, with respect to any one shareholder during any 90‑day period,
solely in cash up to the lesser of $250,000 or 1% of the Fund’s NAV at the
beginning of the period.
COST
BASIS REPORTING
Upon
the redemption or exchange of your shares in the Fund, the Fund or, if you
purchase your shares through a financial intermediary, your financial
intermediary will be required to provide you and the Internal Revenue Service
(“IRS”) with cost basis and certain other related tax information about the Fund
shares you redeemed or exchanged. This cost basis reporting requirement is
effective for shares purchased, including through dividend reinvestment, on or
after January 1, 2012. Please see the Subscription Agreement or consult
your financial intermediary, as appropriate, for more information regarding
available methods for cost basis reporting and how to select or change a
particular method. Please consult your tax advisor to determine which available
cost basis method is best for you.
SIGNATURE
GUARANTEE
You
may need to have your signature guaranteed (STAMP 2000 Medallion) in certain
situations, such as:
· |
|
sending
written requests to wire redemption proceeds (if not previously authorized
on the Subscription Agreement); |
· |
|
sending
redemption proceeds to any person, address or bank account not on record;
and |
· |
|
transferring
redemption proceeds to a Cohen & Steers fund account with a
different registration (name/ownership) from yours.
|
You
can obtain a signature guarantee from most banks, savings institutions,
broker-dealers and other guarantors acceptable to the Fund. The Fund cannot
accept guarantees from notaries public or organizations that do not provide
reimbursement in the case of fraud. A medallion signature guarantee may be
waived in certain limited circumstances. A Signature Validation Program stamp
may be accepted for certain non‑financial shareholder account changes.
SYSTEMATIC
WITHDRAWAL PLAN
Shareholders
may redeem their shares through a Systematic Withdrawal Plan (“SWP”). Under the
SWP, shareholders or their financial intermediaries may request that a payment
drawn in a predetermined amount be sent to them on a monthly, quarterly or
annual basis. If you elect this method of redemption, the Fund will send a check
directly to your address of record or will send the payment directly to your
bank account via electronic funds transfer through the ACH network. For payment
through the ACH network, your bank must be an ACH member and your bank account
information must be previously established on your account. For additional
information on the SWP, please contact the Transfer Agent at (800) 437‑9912. The
SWP may be terminated at any time by the Fund.
REDEMPTION
OF SMALL ACCOUNTS
If
your Fund account value falls below $250 as the result of any voluntary
redemption, we may redeem your remaining shares. We will, however, give you 30
days’ notice of our intention to do so. During this 30‑day notice period, you
may make additional investments to increase your account value above the minimum
purchase amount and avoid having the Fund automatically liquidate your account.
FREQUENT
PURCHASES AND REDEMPTIONS OF FUND SHARES
The
Fund is designed for long-term investors. Excessive trading, short-term market
timing or other abusive trading practices may disrupt portfolio management
strategies and harm portfolio
30
performance.
For example, in order to handle large flows of cash into and out of the Fund, a
portfolio manager may need to allocate more assets to cash or other short-term
investments or sell securities. Transaction costs, such as brokerage commissions
and market spreads, can detract from the Fund’s performance. Additionally,
excessive trading is a concern for the Fund because the Fund’s portfolio will
have foreign securities and therefore could be subject to time-zone arbitrage.
Because
of potential harm to the Fund and its long-term investors, the Board of
Directors of the Fund has adopted policies and procedures to discourage and
prevent excessive trading and short-term market timing. As part of these
policies and procedures, the Advisor monitors purchase, exchange and redemption
activity in Fund shares. The intent is not to inhibit legitimate strategies such
as asset allocation, dollar cost averaging or similar activities that may
nonetheless result in frequent trading of the Fund’s shares. Under these
procedures, the Fund generally prohibits more than two purchases and sales or
exchanges of its shares within a 60 day calendar year period.
The
following transactions are excluded when determining whether trading activity is
excessive: (i) transfers associated with systematic purchases or
redemptions; (ii) transactions through firm- sponsored, discretionary asset
allocation or wrap programs; and (iii) transactions subject to the trading
policy of an intermediary that the Fund deems materially similar to the Fund’s
policy.
If,
based on these procedures, the Advisor determines that a shareholder is engaged
in, or has engaged in, market timing or excessive trading, we may place a
temporary or permanent block on all further purchases or exchanges of Fund
shares.
Multiple
accounts under common ownership or control may be considered one account for the
purpose of determining a pattern of excessive trading, short-term market timing
or other abusive trading practices.
The
Fund will also utilize fair value pricing in an effort to reduce arbitrage
opportunities available to short-term traders.
Due
to the complexity involved in identifying excessive trading and market timing
activity, there can be no guarantee that the Fund will be able to identify and
restrict such activity in all cases. Additionally, it is more difficult for the
Fund to monitor the trading activity of beneficial owners of Fund shares who
hold those shares through third-party 401(k) and other group retirement plans
and other omnibus arrangements maintained by broker/dealers and other
intermediaries. Omnibus account arrangements permit multiple investors to
aggregate their respective share ownership positions and purchase, redeem and
exchange Fund shares in a single account.
In
certain circumstances the Fund may accept frequent trading restrictions of
intermediaries that differ from the Fund’s policies. Since such intermediaries
execute or administer transactions with many fund families, it may be
impractical for them to enforce a particular fund’s frequent trading or exchange
policy. These alternate trading restrictions would be authorized only if the
Fund believes that the alternate restrictions would provide reasonable
protection to the Fund and its shareholders. The Fund reserves the right to
prohibit any purchase, sale or exchange of its shares that the Fund believes may
be disruptive to the Fund or its long-term investors.
ADDITIONAL
INFORMATION
OTHER
COMPENSATION
The
Advisor and the Distributor may make payments from their own resources to
dealers and other financial intermediaries for distribution, administrative or
other services. These payments may be
31
significant
to the dealers and the financial intermediaries, and may create an incentive for
a dealer or financial intermediary or their representatives to recommend or sell
shares of a particular fund or share class over other mutual funds or share
classes. Additionally, these payments may result in the Fund receiving certain
marketing or servicing advantages that are not generally available to mutual
funds that do not make such payments, including placement on a sales list, such
as a preferred or select sales list, or in other sales programs. These payments,
which are in addition to any amounts you may pay your dealer or other financial
intermediary, create potential conflicts of interest between an investor and a
dealer or other financial intermediary who is recommending a particular mutual
fund over other mutual funds. Please contact your dealer or intermediary for
details about payments it may receive. For further details, please consult the
SAI.
DIVIDENDS
AND DISTRIBUTIONS
The
Fund intends to declare and pay dividends from its investment income quarterly.
The Fund intends to distribute net realized capital gains, if any, at least once
each year, normally in December. The Transfer Agent will automatically reinvest
your dividends and distributions in additional shares of the Fund unless you
elected to have them paid to you in cash. If you elect to have dividends and
distributions paid in cash and a dividend or distribution check mailed to you is
returned as undeliverable or is not presented for payment within six months, the
Transfer Agent will reinvest the dividend or distribution in additional shares
of the Fund promptly and the check will be canceled. In addition, future
dividends and distributions will be automatically reinvested in additional
shares of the Fund unless you contact the Fund or Transfer Agent and request to
receive distributions by check.
TAX
CONSIDERATIONS
The
following tax discussion offers only a brief outline of the U.S. federal income
tax consequences of investing in the Fund and is based on the federal tax laws
in effect on the date hereof. Such tax laws are subject to change by
legislative, judicial or administrative action, possibly with retroactive
effect. Further, this discussion does not address tax consequences to specific
types of shareholders such as tax‑advantaged retirement plans or foreign
shareholders (defined below). In the SAI, we have provided more detailed
information regarding the tax consequences of investing in the Fund. Investors
should consult their own tax advisors for more detailed information and for
information regarding the impact of state, local and foreign taxes on an
investment in the Fund.
Dividends
paid to you out of the Fund’s investment income will generally be taxable to you
as ordinary income to the extent of the Fund’s current and accumulated earnings
and profits. Taxes on distributions of capital gains are determined by how long
the Fund owned or is considered to have owned the investments that generated
them, rather than how long you have owned your shares. Distributions from the
sale of investments that the Fund owned for more than one year and that are
properly reported by the Fund as capital gain dividends are taxable to you as
long-term capital gains includible in net capital gain and taxed to individuals
at reduced rates. Distributions from the sale of investments that the Fund owned
for one year or less are taxable to you as ordinary income.
If
a portion of the Fund’s income consists of dividends paid by U.S. corporations,
a portion of the dividends paid by the Fund may be eligible for the corporate
dividends-received deduction for corporate shareholders. In addition,
distributions reported by the Fund as derived from QDI will be taxed in the
hands of individuals at the reduced rates applicable to net capital gain,
provided certain holding period and other requirements are met by both the
shareholder and the Fund. Dividend income that the Fund receives from
U.S. REITs will generally not be treated as QDI and will not qualify
32
for
the dividends-received deduction. The Fund cannot predict at this time what
portion, if any, of its dividends will qualify for the corporate
dividends-received deduction or be eligible for the reduced rates of taxation
applicable to QDI.
Between
2018 and 2025, “qualified REIT dividends” are treated as eligible for a 20%
deduction by non‑corporate taxpayers. Qualified REIT dividends are dividends
received from REITs that are neither capital gain dividends nor are eligible for
treatment as QDI, and with respect to which the REIT shareholder meets certain
other requirements. The Fund is permitted to pass through qualified REIT
dividends to its shareholders, provided the shareholders meet certain holding
period and other requirements with respect to their shares.
A
3.8% Medicare contribution tax is imposed on the net investment income of
certain individuals, trusts and estates to the extent their income exceeds
certain threshold amounts. Net investment income generally includes for this
purpose dividends paid by the Fund, including any capital gain dividends, and
net gains recognized on the sale, exchange or other taxable disposition of
shares of the Fund. Shareholders are advised to consult their tax advisors
regarding the possible implications of this additional tax on their investment
in the Fund.
Because
of “non‑cash” expenses such as property depreciation, the cash flow of a REIT
that owns properties may exceed its taxable income. The REIT, and in turn the
Fund, may distribute this excess cash to shareholders. Such a distribution is
classified as a return of capital. Return of capital distributions generally are
not taxable to you. Your cost basis in your Fund shares will be decreased by the
amount of any return of capital. Any return of capital distributions in excess
of your cost basis will be treated as capital gains.
The
tax treatment of your dividends and distributions will be the same regardless of
whether they were paid to you in cash or reinvested in additional Fund shares.
If you buy shares of the Fund when the Fund has realized but not yet distributed
income or capital gains, you will be “buying a dividend” by paying the full
price for the shares and then receiving a portion back in the form of a taxable
distribution.
A
distribution will be treated as paid to you on December 31 of the current
calendar year if it is declared by the Fund in October, November or December
with a record date in such a month and paid during January of the following
year.
Each
year, we will notify you of the tax status of dividends and other distributions.
The
Fund has elected to be treated as, and intends to qualify each year to be
treated as, a RIC under U.S. federal income tax law. In order to qualify and be
treated as a RIC, the Fund must derive at least 90% of its gross income for each
taxable year from “qualifying income” as defined in the Internal Revenue Code of
1986 (the “Code”) and meet requirements with respect to diversification of
assets and distribution of income and gains. If the Fund does so, the Fund
generally will not be required to pay federal income taxes on any income it
distributes to shareholders. If the Fund were to fail to meet any one of these
requirements, the Fund could in some cases cure such failure, including by
paying a Fund-level tax, paying interest, making additional distributions, or
disposing of certain assets. If the Fund were ineligible to or otherwise did not
cure such failure for any year, the Fund would be subject to tax on its taxable
income and net capital gains at corporate rates, and all distributions from
earnings and profits, including any distributions of net tax‑exempt income and
net long-term capital gains, would be taxable to shareholders as ordinary
income.
Certain
income of the Fund’s investments, including investments in certain debt
instruments, could affect the amount, timing and character of distributions you
receive and could cause the Fund to
33
recognize
taxable income in excess of the cash generated by such investments, which may
require the Fund to liquidate other investments (including when it is not
advantageous to do so) to meet its distribution requirements or otherwise
qualify for treatment as a RIC.
If
you sell or redeem your Fund shares, or exchange them for shares of another
Cohen & Steers open‑end fund, you may realize a capital gain or loss
(provided the shares are held as a capital asset) which will be long-term or
short-term, depending generally on your holding period for the shares.
We
may be required to withhold U.S. federal income tax on all taxable distributions
and redemption proceeds payable if you:
· |
|
fail
to provide us with your correct taxpayer identification number;
|
· |
|
fail
to make required certifications; or |
· |
|
have
been notified by the IRS that you are subject to backup withholding.
|
Backup
withholding is not an additional tax. Any amounts withheld may be credited
against your U.S. federal income tax liability.
Fund
distributions also may be subject to state and local taxes. You should consult
with your own tax advisor regarding the particular consequences of investing in
the Fund.
Non‑resident
alien individuals, foreign trusts or estates, foreign corporations or foreign
partnerships (foreign shareholders) are advised to consult their own tax
advisors with respect to the particular tax consequences to them of an
investment in the Fund.
The
foregoing discussion is based on the federal tax laws in effect on the date
hereof. Such tax laws are subject to change by legislative, judicial, or
administrative action, possibly with retroactive effect. Such changes may have a
negative impact on the Fund or its investors. You should consult with your own
tax advisor regarding potential consequences of changes in tax laws for
investors in the Fund.
Please
see the SAI for more detailed tax information.
34
FINANCIAL
HIGHLIGHTS
The
financial highlights table is intended to help you understand the financial
performance of the Fund for the fiscal years shown below. Certain information
reflects financial results for a single Fund share. The total returns in the
table represent the rate that an investor would have earned or lost on an
investment in the Fund (assuming reinvestment of all dividends and
distributions). These financial highlights have been derived from financial
statements audited by PricewaterhouseCoopers LLP, whose report, along with the
Fund’s audited financial statements, is included in the Fund’s current annual
report, which is available free of charge upon request or by visiting
www.cohenandsteers.com.
The
following table includes selected data for a share outstanding throughout each
year and other performance information derived from the financial statements. It
should be read in conjunction with the financial statements and notes thereto.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
|
For the Year Ended
December 31, |
|
Per
Share Operating Data: |
|
2022 |
|
|
2021 |
|
|
2020 |
|
|
2019 |
|
|
2018 |
|
Net
asset value, beginning of year |
|
$ |
59.18 |
|
|
$ |
43.31 |
|
|
$ |
46.89 |
|
|
$ |
39.25 |
|
|
$ |
43.32 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income
(loss) from investment operations: |
|
|
|
| |
|
|
| |
|
|
| |
|
|
| |
|
| |
Net
investment income (loss)(a) |
|
|
0.85 |
|
|
|
0.43 |
|
|
|
0.80 |
|
|
|
0.84 |
|
|
|
0.93 |
|
Net
realized and unrealized gain (loss) |
|
|
(15.37 |
) |
|
|
17.73 |
|
|
|
(2.25 |
) |
|
|
11.80 |
|
|
|
(2.51 |
)(b) |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
from investment operations |
|
|
(14.52 |
) |
|
|
18.16 |
|
|
|
(1.45 |
) |
|
|
12.64 |
|
|
|
(1.58 |
) |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Less
dividends and distributions to shareholders from: |
|
|
|
| |
|
|
| |
|
|
| |
|
|
| |
|
| |
Net
investment income |
|
|
(0.78 |
) |
|
|
(0.51 |
) |
|
|
(1.03 |
) |
|
|
(0.63 |
) |
|
|
(0.75 |
) |
Net
realized gain |
|
|
(1.32 |
) |
|
|
(1.78 |
) |
|
|
(1.00 |
) |
|
|
(4.37 |
) |
|
|
(1.74 |
) |
Tax
return of capital |
|
|
— |
|
|
|
— |
|
|
|
(0.10 |
) |
|
|
— |
|
|
|
— |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
dividends and distributions to shareholders |
|
|
(2.10 |
) |
|
|
(2.29 |
) |
|
|
(2.13 |
) |
|
|
(5.00 |
) |
|
|
(2.49 |
) |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
increase (decrease) in net asset value |
|
|
(16.62 |
) |
|
|
15.87 |
|
|
|
(3.58 |
) |
|
|
7.64 |
|
|
|
(4.07 |
) |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
asset value, end of year |
|
$ |
42.56 |
|
|
$ |
59.18 |
|
|
$ |
43.31 |
|
|
$ |
46.89 |
|
|
$ |
39.25 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
return(c) |
|
|
–24.73 |
% |
|
|
42.47 |
% |
|
|
–2.57 |
% |
|
|
33.01 |
% |
|
|
–4.01 |
%(b) |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
Ratios/Supplemental
Data: |
|
|
|
| |
|
|
| |
|
|
| |
|
|
| |
|
| |
Net
assets, end of year (in millions) |
|
$ |
5,780.7 |
|
|
$ |
7,476.1 |
|
|
$ |
3,918.8 |
|
|
$ |
3,712.1 |
|
|
$ |
2,659.6 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Ratios
to average daily net assets: |
|
|
|
| |
|
|
| |
|
|
| |
|
|
| |
|
| |
Expenses (before
expense reduction) |
|
|
0.76 |
% |
|
|
0.76 |
% |
|
|
0.76 |
% |
|
|
0.76 |
% |
|
|
0.78 |
%(b) |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Expenses (net
of expense reduction) |
|
|
0.75 |
% |
|
|
0.75 |
% |
|
|
0.75 |
% |
|
|
0.75 |
% |
|
|
0.77 |
%(b) |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
investment income (loss) (before expense reduction) |
|
|
1.72 |
% |
|
|
0.81 |
% |
|
|
1.93 |
% |
|
|
1.81 |
% |
|
|
2.22 |
% |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
investment income (loss) (net of expense reduction) |
|
|
1.73 |
% |
|
|
0.82 |
% |
|
|
1.94 |
% |
|
|
1.82 |
% |
|
|
2.23 |
% |
| |
|
|
|
|
|
|
|
|
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Portfolio
turnover rate |
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34 |
% |
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34 |
% |
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66 |
% |
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82 |
% |
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68 |
% |
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(a) |
Calculation
based on average shares outstanding. |
(b) |
During
the reporting period the Fund settled legal claims against two issuers of
securities previously held by the Fund. As a result, the net realized and
unrealized gain (loss) on investments per share includes proceeds received
from the settlements. Without these proceeds the net realized and
unrealized gain (loss) on investments per share would have been $(2.56).
Additionally, the expense ratio includes extraordinary expenses related to
the direct action. Without these expenses, the ratio of expenses to
average daily net assets (before expense reduction and net of expense
reduction) would have been 0.76% and 0.75%, respectively. Excluding the
proceeds from and expenses relating to the settlements, the total return
would have been ‑4.12%. |
(c) |
Return
assumes the reinvestment of all dividends and distributions at net asset
value. |
35
COHEN &
STEERS INSTITUTIONAL REALTY
SHARES, INC.
THE
USA PATRIOT ACT
To
help the government fight the funding of terrorism and money laundering
activities, federal law requires all financial institutions to obtain, verify
and record information that identifies each person who opens an account. For
more information on obtaining, verifying and recording this information please
see the “Purchasing the Class of Fund Shares that is Best for You.”
What
this means for you: when you open an account, we will ask you for your name,
address, date of birth and other information that will allow us to identify you.
This information will be verified to ensure the identity of all individuals
opening a mutual fund account.
SUBSCRIPTION
AGREEMENT
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1 |
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Account Type (Please print;
indicate only one registration type) |
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A. Individual
or Joint Account* |
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Name |
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Social
Security Number** |
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Date of Birth |
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Name of Joint Owner,
if any |
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Social
Security Number** |
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Date of Birth |
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Citizenship: ☐ U.S.
Citizen ☐ Resident
Alien |
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B. Uniform
Gifts/Transfers to Minors (UGMA/UTMA) |
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Custodian’s name
(only one permitted) |
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Social
Security Number** |
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Date of Birth |
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Minor’s name (only
one permitted) |
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Social
Security Number** |
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Date of Birth |
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under the
Uniform Gifts/Transfers to Minors Act |
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(state
residence of minor) |
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Citizenship of custodian: |
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U.S. Citizen |
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Resident Alien |
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Country
of Citizenship |
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Citizenship of
minor: |
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U.S. Citizen |
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Resident Alien |
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Country
of Citizenship |
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C. Trust,
Corporation or Other Entity*** |
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Name of Trust,
Corporation or Other Entity |
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Tax Identification
Number** |
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Date of Trust
Agreement*** |
Check
the box that describes the entity establishing the account:
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☐ |
U.S.
Financial Institution governed by a federal regulator.
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Bank
governed by a U.S. state bank regulator. |
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Corporation.
If Corporation, provide the tax classification: (C
= C Corporation, S = S Corporation).† Attach a copy of the certified
articles of incorporation or business license unless the corporation is
publicly traded on the New York Stock Exchange or NASDAQ. If so, please
provide ticker symbol:
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☐ |
Retirement
plan governed by ERISA. |
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Trust.
Attach a copy of the Trust Agreement. |
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Partnership.
Attach a copy of Partnership Agreement. |
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Limited
Liability Company (LLC). If LLC, provide the tax classification: (C
= C Corporation, |
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S
= S Corporation, P = Partnership) † |
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U.S.
Government Agency or Instrumentality. |
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☐ |
Foreign
correspondent account, foreign broker-dealer or foreign private banking
account. |
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☐ |
Other. Attach
copy of document that formed entity or by laws or similar document.
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Call
(800) 437‑9912 to see if additional information is required.
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CSIRPRO-052023
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* |
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All joint registrations
will be registered as “joint tenants with rights of survivorship” unless
otherwise specified. |
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** |
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If applied for, include
a copy of application for social security or tax identification number.
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*** |
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In the event your
account type is a Trust, Corporation or Other Entity (including a
corporation, limited liability company, general partnership, statutory
trust, non‑profit or any similar business entity formed in the United
States), a Legal Entity Beneficial Ownership Certification Form (the
“Form”) must be completed by the person opening a new account on behalf of
a legal entity. This form is available at
https://www.cohenandsteers.com/page/fund-documents. If an Application
requires a Form and a Form is not provided, the Application will be
rejected. |
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† |
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If no classification is
provided, per IRS regulations, your account will default to an S
Corporation. |
If
you are establishing an account under 1C above as a (i) Corporation
(non‑publicly traded), (ii) Partnership, (iii) Trust or (iv) Other,
information on each of the individuals authorized to effect transactions must be
provided below:
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Authorized
Individual/Trustee |
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Social
Security Number* |
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Date of Birth |
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Authorized
Individual/Trustee |
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Social
Security Number* |
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Date of Birth |
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Citizenship: ☐ U.S.
Citizen ☐ Resident
Alien |
(If
there are more than two authorized persons, provide the information, in the same
format, on a separate sheet for each such additional person.)
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* |
If
applied for, include a copy of application for social security number.
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** |
Nonresident
aliens must include a copy of a government-issued photo ID with this
application. |
(If
mailing address is a post office box, a street address is also required. APO and
FPO addresses will be accepted.)
Registrant
Street Address
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( ) |
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Street |
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Home Telephone
Number |
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( ) |
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City and
State Zip
Code |
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Business Telephone
Number |
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Mailing Address |
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City |
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State |
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Zip |
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Joint
Registrant Street Address (required if different than Registrant Address above)
$
Amount to invest (must meet minimum investment requirement). Do not send cash.
Investment will be paid for by
(please check one):
|
☐ |
Check
or draft made payable to “Cohen & Steers Institutional Realty
Shares, Inc.” |
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☐ |
Wire
through the Federal Reserve System.*
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* |
Call
(800) 437‑9912 to notify the Fund of investments by wire and to obtain an
account number. See the Purchase of Fund Shares section of the Prospectus
for wire instructions. |
Federal
law requires mutual fund companies to report cost basis information to
shareholders and to the Internal Revenue Service (“IRS”) on mutual fund shares
acquired and subsequently redeemed after December 31, 2011 (“covered
shares”). In order to provide you and the IRS with accurate cost basis
accounting, you are being asked to select a cost basis method to be applied to
your covered shares.
Please
consult your tax adviser to determine which method best suits your individual
tax situation.
If
you do not elect a method, the Fund default method of Average Cost will apply
until it is either revoked or changed by you.
Please
check one of the following available cost basis methods:
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☐ |
Average
Cost (ACST) — The purchase price of all shares in the account are averaged
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☐ |
First
In, First Out (FIFO) — Depletes shares beginning with the earliest
acquisition date |
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☐ |
Last
In, First Out (LIFO) — Depletes shares beginning with the most recent
acquisition date |
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☐ |
High
Cost (HIFO) — Depletes shares beginning with the most expensive shares
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☐ |
Low
Cost (LOFO) — Depletes shares beginning with the least expensive shares
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☐ |
Loss/Gain
Utilization (LGUT) — Depletes shares with losses prior to shares with
gains and short-term shares prior to long-term shares
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☐ |
Specific
Lot Identification — Depletes shares according to the lots chosen by the
shareholder at the time of each redemption. If you choose this method, you
will need to select a secondary cost basis method to be used for
systematic redemptions in cases where the lots you designate are
insufficient or unavailable. Please check one of the following:
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☐ |
First
In, First Out (FIFO) |
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☐ |
Last
In, First Out (LIFO) |
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☐ |
Loss/Gain
Utilization (LGUT) |
Your elected cost basis method will be applied to all
covered shares in this account and future accounts opened with the
Cohen & Steers Funds that have the identical name, account type and
registration as listed on this Subscription Agreement.
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6 |
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Automatic Investment Plan |
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A. |
The
automatic investment plan makes possible regularly scheduled monthly
purchases of Fund shares. The Fund’s Transfer Agent can arrange for an
amount of money selected by you (must meet minimum subsequent investment
minimum) to be deducted from your checking account and used to purchase
shares of the Fund. |
Please
debit $
from my checking account beginning on *.
(Month)
Please
debit my account on (check
one): ☐ 1st of
Month ☐ 15th of Month
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B. |
☐ Please
establish the Auto‑Buy option, which allows you to make additional
investments on dates you choose by having an amount of money selected by
you (must meet minimum subsequent investment minimum) deducted from your
checking account.* |
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* |
To
initiate the Automatic Investment Plan or the Auto‑Buy option, section 11
of this Subscription Agreement must be completed.
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7 |
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Reduced Sales Charge (Class A Only) |
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Aggregating
Accounts or Rights of Accumulation
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☐ |
I
apply for Aggregating Accounts reduced sales charges based on the
following accounts: |
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☐ |
I
apply for Rights of Accumulation reduced sales charges based on the
following accounts: |
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Account
Name |
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Social
Security Number |
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1. |
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- |
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2. |
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3. |
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Letter
of Intention
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☐ |
I
am already investing under an existing Letter of Intention.
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☐ |
I
agree to the Letter of Intention provisions in the Fund’s current
Prospectus. During a 12 month period, I plan to invest a dollar amount of
at least: ☐
$100,000 ☐ $250,000 ☐ $500,000 ☐ $1,000,000
|
Net
Asset Value Purchase
|
☐ |
I
certify that I qualify for an exemption from the sales charge by meeting
the conditions set forth in the Prospectus. |
Exchange
privileges will be automatically granted unless you check the box below.
Shareholders wishing to exchange into other Cohen & Steers Funds or the
SSgA Money Market Fund should consult the Exchange Privilege section of the
Prospectus. (Note: If shares are being purchased through a dealer, please
contact your dealer for availability of this service.)
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☐ |
I
decline the exchange privilege. |
Shareholders
may select the following redemption privileges by checking the box(es) below.
See How to Sell Fund Shares section of the Prospectus for further details.
Redemption privileges will be automatically declined for boxes not checked.
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☐ |
I
authorize the Transfer Agent to redeem shares in my account(s) by
telephone, in accordance with the procedures and conditions set forth in
the Fund’s current Prospectus. |
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☐ |
I
wish to have redemption proceeds paid by wire (please complete
Section 11). |
Dividends
and capital gains may be reinvested or paid by check. If no options are selected
below, both dividends and capital gains will be reinvested in additional Fund
shares.
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Dividends |
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☐ Reinvest. |
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☐ Pay in cash. |
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Capital Gains |
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☐ Reinvest. |
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☐ Pay in cash. |
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☐ |
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I wish to have my
distributions paid by wire (please complete Section 11).
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11 |
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Bank of Record (for Wire Instructions and/or
Automatic Investment Plan) |
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Please
attach a voided check from your bank account.
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Bank
Name |
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Bank
ABA Number |
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Street
or P.O. Box |
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Bank
Account Number |
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City and
State Zip
Code |
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Account
Name |
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12 |
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Signature and Certifications |
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(a) |
By
signing this agreement, I represent and warrant that:
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(1) |
I
have the full right, power, capacity and authority to invest in the Fund;
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(2) |
I
am of legal age in my state of residence or am an emancipated minor;
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(3) |
All
of the information on this agreement is true and correct; and
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(4) |
I
will notify the Fund immediately if there is any change in this
information. |
(b) |
I
have read the current Prospectus of the Fund and this agreement and agree
to all their terms. I also agree that any shares purchased now or later
are and will be subject to the terms of the Fund’s Prospectus as in effect
from time to time. Further, I agree that the Fund, its administrators and
service providers and any of their directors, trustees, employees and
agents will not be liable for any claims, losses or expenses (including
legal fees) for acting on any instructions believed to be genuine,
provided that reasonable security procedures have been followed. If an
account has multiple owners, the Fund may rely on the instructions of any
one account owner unless all owners specifically instruct the Fund
otherwise. |
(c) |
I
am aware that under the laws of certain states, the assets in my account
may be transferred (escheated) to the state if no activity occurs in my
account within a specified period of time. |
(d) |
If
I am a U.S. citizen, resident alien, or a representative of a U.S. entity,
I certify, under penalty of perjury, that: |
|
(1) |
The
taxpayer identification number and tax status shown on this form are
correct. |
|
(2) |
I
am not subject to backup withholding because: |
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• |
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I
am exempt from backup withholding, OR |
|
• |
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I
have not been notified by the IRS that I am subject to backup withholding
as a result of a failure to report all interest or dividends, OR
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• |
|
The
IRS has notified me that I am no longer subject to backup withholding.
|
NOTE:
If you have been notified by the IRS that you are currently subject to backup
withholding because of under-reporting interest or dividends on your tax return,
you must cross out this Item 2
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(3) |
I
am a U.S. person (including resident alien). |
(e) |
Additional
Certification: |
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(1) |
Neither
I (we), nor any person having a direct or indirect beneficial interest in
the shares to be acquired, appears on any U.S. government published list
of persons who are known or suspected to engage in money laundering
activities, such as the Specially Designated Nationals and Blocked Persons
List of the Office of Foreign Assets Control of the United States
Department of the Treasury. I (we) do not know or have any reason to
suspect that (i) the monies used to fund my (our) investment have
been or will be derived from or related to any illegal activities and
(ii) the proceeds from my (our) investment will be used to finance
any illegal activities. |
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(2) |
I
agree to provide such information and execute and deliver such documents
as the Fund may reasonably request from time to time to verify the
accuracy of the information provided in connection with the opening of an
account or to comply with any law, rule or regulation to which the Fund
may be subject, including compliance with anti-money laundering laws.
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The
IRS does not require your consent to any provision of this document other
than the certifications required to avoid backup withholding.
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x |
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x |
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Signature*
(Owner, Trustee, Etc.) |
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Date |
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Signature* (Joint Owner, Co‑Trustee) |
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Date |
* |
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If shares are to be
registered in (1) joint names, both persons should sign, (2) a
custodian’s name, the custodian should sign, (3) a trust, the
trustee(s) should sign, or (4) a corporation or other entity, an
officer or other authorized person should sign and print name and title
above. Persons signing as representatives or fiduciaries of corporations,
partnerships, trusts or other organizations are required to furnish
corporate resolutions or similar documents providing evidence that they
are authorized to effect securities transactions on behalf of the Investor
(alternatively, the secretary or another designated officer of the entity
may certify the authority of the persons signing on the space provided
above). |
Mail
to: SS&C GIDS, Inc., P.O. Box 219953, Kansas City, MO 64121-9953
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For Authorized Dealer Use
Only |
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We hereby authorize the Transfer
Agent to act as our agent in connection with the transactions authorized
by the Subscription Agreement and agree to notify the Transfer Agent of
any purchases made under a Letter of Intention, Rights of Accumulation or
Aggregating Accounts. If the Subscription Agreement includes a telephone
redemption privilege, we guarantee the signature(s) above. |
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Dealer’s Name |
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Dealer Number |
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Main Office Address |
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Branch Number |
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Representative’s Name |
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Rep. Number |
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( ) |
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Branch Address |
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Telephone Number |
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Authorized Signature of Dealer |
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Date |