Notes

ING Clarion Global Real Estate Income Fund - IGR

"The Fund's primary objective is high current income and its secondary objective is capital appreciation. The Fund invests from 80% to 100% of its total assets in income-producing real estate securities (including REITs) located mainly in the developed markets of North America, Europe, Australia, and Asia. The Fund can invest up to 25% of its assets in preferred shares of global real estate companies.

19FEB09 - $3

Feb. 19:
NAV 4.12
Market Price 3.00
Premium/Discount -27.2%
Distribution Yield 18%
Net Expenses: 1%

"As we write this letter, many real estate companies around the globe are reporting their final 2008 results and are providing a glimpse of current market conditions and guidance for 2009. The picture is sobering. As reported in our year-end letter, we expect earnings for real estate companies to decline an average of -5.5% in 2009.

As of Dec. 31, 2008.
Retail 29%
Diversified 10%
Office 17%
Residential 7%
Industrial 7%
Healthcare 10%
Hotels 5%
Storage 4%
Other 2%
US REITs 27%
US RE Preferred 16%

Canada 5%
Brazil 1%
Europe 19%
UK 7%
Australia 6%
Hong Kong 5%
Japan 5%
Other Asia 2%

Cash 8%

The CEO bought shares in Oct. 2008, at $5.50.

Thoughts: Closed-end funds rarely have discounts to NAV over 25%. Those that do usually either hold private equity (so the NAV is unreliable), or have expense ratios over 2%. IGR holds mostly publicly traded stock, and its expense ratio is 1%. I doubt its discount will widen much. The stock may go down, if its portfolio does, but the discount provides a nice cushion. If the portfolio goes up, IGR will probably go up more, returning to a more average discount to NAV. My guess is REIT income will decline by more than 5.5% in 2009.

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