UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM N-Q
QUARTERLY SCHEDULE OF PORTFOLIO HOLDINGS OF REGISTERED
MANAGEMENT INVESTMENT COMPANY
_______________________________
Investment Company Act file number 811-21340
DWS RREEF Real Estate Fund II, Inc.
(Exact name of registrant as specified in charter)
One South Street
Baltimore, MD 21202
(Address of principal executive offices) (Zip code)
Paul Schubert
345 Park Avenue
New York, NY 10154
(Name and address of agent for service)
Registrant's telephone number, including area code: (212) 454-7190
Date of fiscal year end: 12/31
Date of reporting period: 09/30/06
Form N-Q is to be used by registered management investment companies, other than small business investment companies registered on Form N-5 (§§ 239.24 and 274.5 of this chapter), to file reports with the Commission, not later than 60 days after the close of the first and third fiscal quarters, pursuant to rule 30b1-5 under the Investment Company Act of 1940 (17 CFR 270.30b1-4). The Commission may use the information provided on Form N-Q in its regulatory, disclosure review, inspection, and policymaking roles.
A registrant is required to disclose the information specified by Form N-Q, and the Commission will make this information public. A registrant is not required to respond to the collection of information contained in Form N-Q unless the Form displays a currently valid Office of Management and Budget ("OMB") control number. Please direct comments concerning the accuracy of the information collection burden estimate and any suggestions for reducing the burden to the Secretary, Securities and Exchange Commission, 450 Fifth Street, NW, Washington, DC 20549-0609. The OMB has reviewed this collection of information under the clearance requirements of 44 U.S.C. § 3507.
ITEM 1. SCHEDULE OF INVESTMENTS
|
Investment Portfolio |
as of September 30, 2006 (Unaudited) |
DWS RREEF Real Estate Fund II, Inc.
|
|
Shares |
|
Value ($) | ||||
|
| |||||||
|
|
Common Stocks 118.4% |
| |||||
|
Apartments 14.8% |
| ||||||
|
American Campus Communities, Inc. (REIT) |
|
540,102 |
|
13,778,002 | |||
|
Apartment Investment & Management Co. "A" (REIT) |
|
1,288,859 |
|
70,126,818 | |||
|
BRE Properties, Inc. "A" (REIT) |
|
229,900 |
|
13,731,927 | |||
|
GMH Communities Trust (REIT) |
|
591,800 |
|
7,468,516 | |||
|
Home Properties, Inc. (REIT) |
|
321,700 |
|
18,388,372 | |||
|
| |||||||
|
|
123,493,635 | ||||||
|
Diversified 3.5% |
| ||||||
|
iStar Financial, Inc. (REIT) |
|
381,700 |
|
15,916,890 | |||
|
Spirit Finance Corp. (REIT) |
|
1,125,900 |
|
13,071,699 | |||
|
| |||||||
|
|
28,988,589 | ||||||
|
Health Care 10.1% |
| ||||||
|
LTC Properties, Inc. (REIT) |
|
248,300 |
|
6,021,275 | |||
|
Medical Properties Trust, Inc. (REIT) |
|
460,100 |
|
6,160,739 | |||
|
National Health Investors, Inc. (REIT) |
|
287,600 |
|
8,147,708 | |||
|
National Health Realty, Inc. (REIT) |
|
137,800 |
|
2,743,598 | |||
|
Senior Housing Properties Trust (REIT) |
|
1,386,900 |
|
29,596,446 | |||
|
Ventas, Inc. (REIT) |
|
810,200 |
|
31,225,108 | |||
|
| |||||||
|
|
83,894,874 | ||||||
|
Hotels 17.7% |
| ||||||
|
Ashford Hospitality Trust (REIT) |
|
1,903,900 |
|
22,713,527 | |||
|
Canyon Ranch Holdings LLC (REIT) (Units) |
|
864,000 |
|
23,731,563 | |||
|
DiamondRock Hospitality Co. (REIT) |
|
921,900 |
|
15,312,759 | |||
|
Eagle Hospitality Properties Trust, Inc. (REIT) |
|
670,500 |
|
6,235,650 | |||
|
Hersha Hospitality Trust (REIT) |
|
2,744,400 |
|
26,346,240 | |||
|
Hospitality Properties Trust (REIT) |
|
581,250 |
|
27,435,000 | |||
|
Strategic Hotels & Resorts, Inc. (REIT) |
|
1,020,600 |
|
20,289,528 | |||
|
Winston Hotels, Inc. (REIT) |
|
449,043 |
|
5,532,210 | |||
|
| |||||||
|
|
147,596,477 | ||||||
|
Industrial 13.0% |
| ||||||
|
First Industrial Realty Trust, Inc. (REIT) |
|
1,119,500 |
|
49,258,000 | |||
|
Liberty Property Trust (REIT) |
|
1,234,500 |
|
58,996,755 | |||
|
| |||||||
|
|
108,254,755 | ||||||
|
Office 29.6% |
| ||||||
|
American Financial Realty Trust (REIT) |
|
2,079,400 |
|
23,206,104 | |||
|
Digital Realty Trust, Inc. (REIT) |
|
791,000 |
|
24,774,120 | |||
|
Duke Realty Corp. (REIT) |
|
309,100 |
|
11,544,885 | |||
|
Equity Office Properties Trust (REIT) |
|
437,500 |
|
17,395,000 | |||
|
Glenborough Realty Trust, Inc. (REIT) |
|
1,403,808 |
|
36,119,980 | |||
|
Highwoods Properties, Inc. (REIT) |
|
754,800 |
|
28,086,108 | |||
|
HRPT Properties Trust (REIT) |
|
4,221,700 |
|
50,449,315 | |||
|
Lexington Corporate Properties Trust (REIT) |
|
1,775,700 |
|
37,609,326 | |||
|
Mack-Cali Realty Corp. (REIT) |
|
343,482 |
|
17,792,367 | |||
|
| |||||||
|
|
246,977,205 | ||||||
|
Other 1.9% |
| ||||||
|
Crystal River Capital, Inc. 144A |
|
332,500 |
|
7,607,600 | |||
|
Deerfield Triarc Capital Corp. (REIT) |
|
662,500 |
|
8,685,375 | |||
|
| |||||||
|
|
16,292,975 | ||||||
|
Regional Malls 16.4% |
| ||||||
|
Feldman Mall Properties, Inc. (REIT) |
|
837,400 |
|
9,236,522 | |||
|
Glimcher Realty Trust (REIT) |
|
2,062,753 |
|
51,115,020 | |||
|
Pennsylvania Real Estate Investment Trust (REIT) |
|
656,839 |
|
27,961,636 | |||
|
Simon Property Group, Inc. (REIT) |
|
533,800 |
|
48,372,956 | |||
|
| |||||||
|
|
136,686,134 | ||||||
|
Shopping Centers 4.4% |
| ||||||
|
Inland Real Estate Corp. (REIT) |
|
706,900 |
|
12,384,888 | |||
|
Ramco-Gershenson Properties Trust (REIT) |
|
754,800 |
|
24,115,860 | |||
|
| |||||||
|
|
36,500,748 | ||||||
|
Specialty Services 2.0% |
| ||||||
|
Entertainment Properties Trust (REIT) |
|
265,400 |
|
13,089,528 | |||
|
One Liberty Properties, Inc. (REIT) |
|
150,000 |
|
3,360,000 | |||
|
| |||||||
|
|
16,449,528 | ||||||
|
Storage 5.0% |
| ||||||
|
Extra Space Storage, Inc. (REIT) |
|
2,416,203 |
|
41,824,474 | |||
|
| |||||||
|
| |||||||
|
| |||||||
|
Total Common Stocks (Cost $753,208,172) |
|
986,959,394 | |||||
|
|
Preferred Stocks 19.8% |
| |||||
|
Apartments 1.8% |
| ||||||
|
Apartment Investment & Management Co., 8.0%, Series T (REIT) |
|
136,200 |
|
3,456,756 | |||
|
Associated Estates Realty Corp., 8.7%, Series II (REIT) |
|
429,000 |
|
11,209,770 | |||
|
| |||||||
|
|
14,666,526 | ||||||
|
Health Care 0.9% |
| ||||||
|
LTC Properties, Inc., 8.0%, Series F (REIT) |
|
300,000 |
|
7,521,000 | |||
|
Hotels 7.2% |
| ||||||
|
Eagle Hospitality Properties Trust, Inc., 8.25%, Series A (REIT) |
|
348,200 |
|
8,824,711 | |||
|
Equity Inns, Inc. 8.0%, Series C (REIT) |
|
380,000 |
|
9,652,000 | |||
|
FelCor Lodging Trust, Inc., 8.0%, Series C (REIT) |
|
75,000 |
|
1,868,250 | |||
|
Host Marriott Corp., 8.875%, Series E (REIT) |
|
204,400 |
|
5,410,468 | |||
|
LaSalle Hotel Properties, 8.375%, Series B (REIT) |
|
270,000 |
|
6,914,700 | |||
|
Strategic Hotels & Resorts, Inc. 8.25%, Series B (REIT) |
|
115,400 |
|
3,007,612 | |||
|
Strategic Hotels & Resorts, Inc. 8.5%, 144A (REIT) |
|
332,500 |
|
8,478,750 | |||
|
Sunstone Hotel Investors, Inc., 8.0%, Series A (REIT) |
|
633,500 |
|
16,193,844 | |||
|
| |||||||
|
|
60,350,335 | ||||||
|
Manufactured Homes 0.2% |
| ||||||
|
American Land Lease, Inc., 7.75%, Series A (REIT) |
|
51,000 |
|
1,284,435 | |||
|
Office 3.5% |
| ||||||
|
Digital Realty Trust, Inc., 8.5%, Series A (REIT) |
|
356,700 |
|
9,407,963 | |||
|
SL Green Realty Corp., 7.58%, Series C (REIT) |
|
775,000 |
|
19,615,250 | |||
|
| |||||||
|
|
29,023,213 | ||||||
|
Regional Malls 1.0% |
| ||||||
|
Taubman Centers, Inc., 8.0%, Series G (REIT) |
|
329,253 |
|
8,768,007 | |||
|
Shopping Centers 5.2% |
| ||||||
|
Cedar Shopping Centers, Inc., 8.875% (REIT) |
|
300,000 |
|
7,977,000 | |||
|
The Mills Corp., 8.75%, Series E (REIT) |
|
1,720,000 |
|
35,672,800 | |||
|
| |||||||
|
|
43,649,800 | ||||||
|
| |||||||
|
Total Preferred Stocks (Cost $170,487,348) |
|
165,263,316 | |||||
|
|
Other 1.4% |
| |||||||
|
Innkeepers USA Trust (REIT) (Limited Partnership) (a) (Cost $9,299,494) |
|
696,309 |
|
11,342,874 | |||||
|
|
Cash Equivalents 0.4% |
| |||||||
|
Cash Management QP Trust, 5.34% (b) (Cost $3,612,467) |
|
|
3,612,467 |
|
3,612,467 | ||||
|
|
% of |
|
Value ($) | ||||||
|
| |||||||||
|
Total Investment Portfolio (Cost $ 936,607,481) |
140.0 |
|
1,167,178,051 | ||||||
|
Other Assets and Liabilities, Net |
2.0 |
|
16,781,041 | ||||||
|
Preferred Stock, at Redemption Value |
(42.0) |
|
(350,000,000) | ||||||
|
| |||||||||
|
Net Assets |
100.0 |
|
833,959,092 | ||||||
|
|
For information on the Fund's policies regarding the valuation of investments and other significant accounting policies, please refer to the Fund's most recent semi-annual or annual financial statements. | ||||||||
|
|
| ||||||||
|
(a) |
The Fund may purchase securities that are subject to legal or contractual restrictions on resale ("restricted securities"). Restricted securities are securities which have not been registered with the Securities and Exchange Commission under the Securities Act of 1933. The fund may be unable to sell a restricted security and it may be more difficult to determine a market value for a restricted security. Moreover, if adverse market conditions were to develop during the period between the Fund's decision to sell a restricted security and the point at which the Fund is permitted or able to sell such security, the Fund might obtain a price less favorable than the price that prevailed when it decided to sell. This investment practice, therefore, could have the effect of increasing the level of illiquidity of the Fund. The future value of these securities is uncertain and there may be changes in the estimated value of these securities. | ||||||||
|
|
Acquisition |
|
|
As a % of |
|
Restricted Security |
Dates |
Cost ($) |
Value ($) |
Net Assets |
|
Innkeepers USA Trust |
November 2002- |
|
|
|
|
(REIT) (Limited Partnership) |
March 2005 |
9,299,494 |
11,342,874 |
1.4 |
|
(b) |
Cash Management QP Trust, an affiliated fund, is managed by Deutsche Investment Management Americas Inc. The rate shown is the annualized seven-day yield at period end. | ||||||||||
|
144A: Security exempt from registration under Rule 144A of the Securities Act of 1933. These securities may be resold in transactions exempt from registration, normally to qualified institutional buyers. | |||||||||||
|
REIT: Real Estate Investment Trust | |||||||||||
|
At September 30, 2006, open interest rate swaps were as follows: | |||||||||||
|
Effective/ |
|
Notional |
|
Cash Flows Paid |
|
Cash Flows |
|
Net Unrealized | |||
|
| |||||||||||
|
| |||||||||||
|
11/26/2003 |
|
87,500,000
|
†
|
Fixed — 2.805% |
|
USD— Floating |
|
366,905
|
| ||
|
1/14/2004 |
|
87,500,000
|
††
|
Fixed — 2.992% |
|
USD— Floating |
|
2,432,124
|
| ||
|
11/26/2003 |
|
87,500,000
|
†
|
Fixed — 3.589% |
|
USD— Floating |
|
2,603,212
|
| ||
|
11/26/2003 |
|
87,500,000
|
†††
|
Fixed —4.064% |
|
USD— Floating |
|
3,058,186
|
| ||
|
| |||||||||||
|
Total net unrealized appreciation |
|
8,460,427 |
| ||||||||
|
| |||||||||||
Counterparties:
† Bank of America
†† UBS AG
††† Goldman, Sachs & Co.
LIBOR: Represents the London InterBank Offered Rate.
BBA: British Banker’s Association
|
|
An affiliated issuer includes any company in which the Fund has ownership of at least 5% of the outstanding voting securities. A summary of the Fund's transactions during the nine months ended September 30, 2006, with companies which are or were affiliates is as follows: |
|
Affiliate |
|
Common Shares |
Purchase Cost ($) |
Sales (Cost) ($) |
Realized Gain/(Loss) ($) |
Dividend Income ($) |
Value at 9/30/06 ($) | |||
|
Feldman Mall Properties, Inc. (REIT) |
|
837,400 |
- |
- |
- |
571,526 |
N/A |
| ||
|
Glimcher Realty Trust (REIT) |
|
2,062,753 |
- |
- |
- |
2,975,315 |
N/A |
| ||
|
Hersha Hospitality Trust (REIT) |
|
2,744,400 |
2,593,035 |
- |
- |
1,378,620 |
N/A |
| ||
|
AMLI Residential Property (REIT) |
|
- |
- |
36,886,498 |
16,521,974 |
172,032 |
- |
| ||
|
|
|
|
2,593,035 |
36,886,498 |
16,521,974 |
5,097,493 |
- |
| ||
|
N/A |
No longer an affiliate at September 30, 2006. |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
|
Registrant: |
DWS RREEF Real Estate Fund II, Inc. |
|
By: |
/s/Michael G. Clark |
|
|
Michael G. Clark |
President
|
Date: |
November 21, 2006 |
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.
|
Registrant: |
DWS RREEF Real Estate Fund II, Inc. |
|
By: |
/s/Michael G. Clark |
|
|
Michael G. Clark |
President
|
Date: |
November 21, 2006 |
|
By: |
/s/Paul Schubert |
|
|
Paul Schubert |
Chief Financial Officer and Treasurer
Date: November 21, 2006