Company: PGZ
Filing Date: 2025-01-03
Form Type: N-CSR
Source: 0001398344-25-000145
Chunk: 50

Company: Principal Real Estate Income Fund
Filing Date: 2025-01-03
Form: N-CSR
Chunk 50
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October 31, 2024 (Unaudited)

Risks Associated with Tax Code or Accounting Changes. CMBS are generally structured as REMICs under the Code, which impacts the tax treatment of the CMBS. Changes to REMIC legislation could impact the investment performance of the CMBS and, as a result, the Fund. In addition, changes in accounting standards, such as mark-to-market or consolidation rules, could negatively impact the performance of the Fund.

Below Investment Grade Securities Risk.The Fund may invest in CMBS and other securities rated below investment grade or, if unrated, determined by PrinREI to be of comparable credit quality, which are commonly referred to as “high-yield” or “junk” bonds. Investment in junk bonds involves substantial risk of loss. Junk bonds are predominantly speculative with respect to the issuer’s capacity to pay interest and repay principal when due and therefore involve a greater risk of default or decline in market value due to adverse economic and issuer-specific developments. Junk bonds display increased price sensitivity to changing interest rates and to a deteriorating economic environment. The market values for junk bonds tend to be more volatile and such securities tend to be less liquid than investment grade debt securities.

Real Estate-Related Securities Risk. The Fund’s investments will be subject to the risks inherent in the ownership and operation of real estate and real estate-related businesses and assets. These risks include, but are not limited to:

| ● | the                                    
 burdens of ownership of real property; |

| ● | general                                                                                
 and local economic conditions (such as an oversupply of space or a reduction in demand 
 for space);                                                                            |

| ● | the                                                                             
 supply and demand for properties (including competition based on rental rates); |

| ● | energy                
 and supply shortages; |

| ● | fluctuations                         
 in average occupancy and room rates; |

| ● | the                                                                                        
 attractiveness, type and location of the properties and changes in the relative popularity 
 of commercial properties as an investment;                                                 |

| ● | the                                                                             
 financial condition and resources of tenants, buyers and sellers of properties; |

| ● | increased          
 mortgage defaults; |

| ● | the                                                        
 quality of maintenance, insurance and management services; |

| ● | changes                                                                                      
 in the availability of debt financing which may render the sale or refinancing of properties 
 difficult or impracticable;                                                                  |

| ● | changes                                                                                 
 in building, environmental and other laws and/or regulations (including those governing 
 usage and improvements), fiscal policies and zoning laws;