Cohen & Steers Qty Realty Stock Price, News & Analysis
Company Description
Cohen & Steers Quality Income Realty Fund, Inc. (NYSE: RQI) is a diversified, closed-end management investment company. According to its stated investment objectives, the Fund focuses on high current income as its primary goal, with capital appreciation as a secondary objective. It pursues these objectives by investing in real estate securities within the finance and insurance sector, which is classified under securities and commodity exchanges.
Under normal market conditions, the Fund invests at least its total assets in income-producing common stocks and other securities issued by real estate companies, including real estate investment trusts (REITs). By concentrating on income-producing real estate securities, the Fund is structured to generate a stream of distributions while also seeking long-term total return potential through exposure to real estate-related assets.
Managed distribution policy
In December 2012, the Fund implemented a managed distribution policy in accordance with exemptive relief issued by the U.S. Securities and Exchange Commission. This policy is designed to deliver the Fund's long-term total return potential through regular monthly distributions declared at a fixed rate per common share. The policy gives the Fund greater flexibility to realize long-term capital gains throughout the year and to distribute those gains on a regular monthly basis.
The Fund states that its monthly distributions may include long-term capital gains, short-term capital gains, net investment income and/or return of capital for federal income tax purposes. A return of capital occurs when distributions exceed net investment income and net realized capital gains and are paid from the Fund's assets. The Fund notes that a return of capital is not taxable when received but reduces a shareholder's tax basis in their shares.
The Board of Directors of the Fund may amend, terminate or suspend the managed distribution policy at any time, and the Fund notes that such changes could have an adverse effect on the market price of its shares. The Fund also explains that the amount of monthly distributions may vary depending on factors such as portfolio changes and market conditions.
Real estate securities focus
The Fund's strategy centers on real estate securities, including securities issued by REITs. Distributions from the Fund's investments in REITs may later be characterized for tax purposes as capital gains and/or return of capital, depending on how the REIT dividends are reported to the Fund after year end. This structure ties the Fund's income and distribution profile to the performance and tax character of underlying real estate companies.
Because the Fund is a closed-end investment company, its shares trade on an exchange and the market price of the Fund's shares is determined by supply and demand in the open market. The Fund highlights that its net asset value (NAV) is calculated as the total market value of all securities and other assets held, minus total liabilities, divided by the number of shares outstanding. While NAV performance may be indicative of investment performance, the Fund notes that a shareholder's actual investment value is determined by the market price, which can differ from NAV.
Distribution reporting and tax information
For each monthly distribution, the Fund provides shareholders with a notice that includes estimated amounts and sources of the distribution, broken down among net investment income, short-term capital gains, long-term capital gains and return of capital. These notices emphasize that the amounts and sources are estimates, may change over time and are not intended for tax reporting purposes.
The Fund states that the final tax characteristics of all distributions cannot be determined with certainty until after the end of the calendar year. Shareholders receive a Form 1099-DIV after year end, which provides the final information needed for federal income tax reporting. The Fund cautions shareholders not to use the interim distribution notices when preparing tax returns.
Role within the Cohen & Steers platform
The Fund is part of the broader Cohen & Steers family of funds. Cohen & Steers is described as a global investment manager specializing in real assets and alternative income, including listed and private real estate, preferred securities, infrastructure, resource equities, commodities and multi-strategy solutions. The firm was founded in 1986 and is headquartered in New York City, with additional offices in London, Dublin, Hong Kong, Tokyo and Singapore. RQI reflects Cohen & Steers' focus on real estate-related strategies and income-oriented investment products.
Investor information and regulatory filings
The Fund encourages investors to consider its investment objectives, risks, charges and expenses carefully before investing. It notes that periodic reports and other regulatory filings are available through financial advisors and through the Securities and Exchange Commission's EDGAR database. These documents provide more detail on the Fund's holdings, performance, risks and fee structure.
Because the Fund is a closed-end management investment company, it is subject to the regulatory framework governing registered investment companies, and it provides regular disclosures on performance metrics such as year-to-date cumulative total return, cumulative distribution rate, average annual total return and current annualized distribution rate based on NAV. The Fund explains how these measures are calculated, emphasizing that total return figures assume reinvestment of distributions and that distribution rates are measured as a percentage of NAV over specified periods.
Key characteristics of RQI
- Diversified, closed-end management investment company.
- Primary objective of high current income; secondary objective of capital appreciation.
- Invests at least its total assets in income-producing common stocks and other securities issued by real estate companies, including REITs, under normal market conditions.
- Operates under a managed distribution policy implemented in December 2012, providing regular monthly distributions at a fixed rate per common share.
- Distributions may consist of net investment income, short-term capital gains, long-term capital gains and/or return of capital for tax purposes.
- Part of the Cohen & Steers platform, which specializes in real assets and alternative income.
Overall, Cohen & Steers Quality Income Realty Fund, Inc. offers exposure to real estate securities through a closed-end fund structure, with an emphasis on generating current income and providing regular, managed distributions, while also seeking long-term total return.