N-CSR 1 ncsr.txt OMB APPROVAL OMB Number: 3235-0570 Expires: August 31, 2010 Estimated average burden hours per response.....18.9 UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM N-CSR CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT INVESTMENT COMPANIES Investment Company Act file number 811-07870 Pioneer Real Estate Shares (Exact name of registrant as specified in charter) 60 State Street, Boston, MA 02109 (Address of principal executive offices) (ZIP code) Terrence J. Cullen, Pioneer Investment Management, Inc., 60 State Street, Boston, MA 02109 (Name and address of agent for service) Registrant's telephone number, including area code: (617) 742-7825 Date of fiscal year end: December 31 Date of reporting period: January 1, 2010 through June 30, 2010 Form N-CSR is to be used by management investment companies to file reports with the Commission not later than 10 days after the transmission to stockholders of any report that is required to be transmitted to stockholders under Rule 30e-1 under the Investment Company Act of 1940 (17 CFR 270.30e-1). The Commission may use the information provided on Form N-CSR in its regulatory, disclosure review, inspection, and policymaking roles. A registrant is required to disclose the information specified by Form N-CSR, and the Commission will make this information public. A registrant is not required to respond to the collection of information contained in Form N-CSR 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 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. ss. 3507. ITEM 1. REPORTS TO SHAREOWNERS. Pioneer Real Estate Shares -------------------------------------------------------------------------------- Semiannual Report | June 30, 2010 -------------------------------------------------------------------------------- Ticker Symbols: Class A PWREX Class B PBREX Class C PCREX Class Y PYREX [LOGO]PIONEER Investments(R) visit us: pioneerinvestments.com Table of Contents Letter to Shareowners 2 Portfolio Management Discussion 4 Portfolio Summary 8 Prices and Distributions 9 Performance Update 10 Comparing Ongoing Fund Expenses 14 Schedule of Investments 16 Financial Statements 21 Notes to Financial Statements 29 Trustees, Officers and Service Providers 36
Pioneer Real Estate Shares | Semiannual Report | 6/30/10 1 President's Letter Dear Shareowner, Stock and bond markets around the globe have begun to recover over the past year from one of their most tumultuous periods in history. This is a welcome relief, and we are generally optimistic about the prospects for the economy going forward. Still, challenges remain. Unemployment is high; consumer demand and loan growth are weak; and housing has not returned to normal. At Pioneer, we have long advocated the benefits of investing for the long term. This strategy has generally performed well for many investors. Those who remained invested in the market during the downturn have most likely seen their portfolios start to recover over the past year, as the Dow Jones Industrial Average climbed back from the depressed levels we saw in early 2009. Many bond investors have similarly seen a strong rebound, with a broad-based recovery occurring across many different fixed-income asset classes. The riskiest asset classes, such as high-yield bonds, outperformed other fixed-income asset classes during most of 2009. At Pioneer, we are not changing the approach to investing that we have used for more than 80 years. We remain focused on company fundamentals and risk management. Our investment process is based on careful research into individual companies, quantitative analysis, and active portfolio management. This three-pillared process, which we apply to each of our portfolios, is supported by an integrated team approach and is designed to carefully balance risk and reward. While we see potential opportunities for making money in many corners of the markets around the globe, it takes research and experience to separate solid investment opportunities from speculation. Following this difficult period, many investors are rethinking their approach to investing and risk management. Some are questioning whether the basic investment principles they were taught in the past are still useful in today's markets. Complicating matters is that financial markets remain unpredictable. Our advice, as always, is to work closely with a trusted financial advisor to discuss your goals and work together to develop an investment strategy that meets your individual needs. There is no single best strategy that works for every investor. 2 Pioneer Real Estate Shares | Semiannual Report | 6/30/10 We invite you to learn more about Pioneer and our time-tested approach to investing by consulting with your financial advisor or visiting us online at www.pioneerinvestments.com. We greatly appreciate your trust in us and we thank you for investing with Pioneer. Sincerely, /s/ Daniel K. Kingsbury Daniel K. Kingsbury President and CEO Pioneer Investment Management USA, Inc. Any information in this shareowner report regarding market or economic trends or the factors influencing the Fund's historical or future performance are statements of the opinion of Fund management as of the date of this report. These statements should not be relied upon for any other purposes. Past performance is no guarantee of future results, and there is no guarantee that market forecasts discussed will be realized. Pioneer Real Estate Shares | Semiannual Report | 6/30/10 3 Portfolio Management Discussion | 6/30/10 Investor concerns about the viability of the economic recovery, sputtering employment growth, Europe's sovereign debt crisis, and the oil spill in the Gulf of Mexico weighed heavily on stocks during the first half of 2010. However, real estate investments held up much better than the broader equity markets, which generally posted negative returns for the six months ended June 30, 2010. In the following interview, Matthew Troxell of AEW Capital Management, L.P., the Fund's sub-adviser, discusses his strategies for managing Pioneer Real Estate Shares amidst the increased volatility over the six months ended June 30, 2010. Q How did the real estate market fare over the six months ended June 30, 2010? A While the real estate sector was not necessarily immune to the broader market woes, it outperformed the major U.S. stock markets considerably over the six-month period, due in large part to positive year-to-date fund flows into the sector, a stabilization of real estate market fundamentals, low interest rates, and increased demand for higher-yielding securities. Real estate investment trusts (REITs) also were aided early in the period by news that Simon Property Group, along with other REITs, expressed an interest in buying all or most of General Growth Properties. Q How did the Fund perform in that environment over the six months ended June 30, 2010? A For the six months ended June 30, 2010, Pioneer Real Estate Shares' Class A shares returned 7.11% at net asset value, while the Fund's benchmark, the Morgan Stanley Capital International (MSCI) U.S. REIT Index1, returned 5.70%. Over the same period, the average return of the 235 funds in Lipper's Real Estate Funds category was 5.21%. The Fund's solid outperformance relative to the benchmark was attributable to strong stock selection in the office, industrial and storage sectors. From a sector-allocation perspective, the Fund's overweights in the outperforming apartment and storage sectors also contributed positively to relative performance. However, the Fund's underweight in the hotel sector, which outperformed, was a detractor. Also, a modest cash balance detracted from performance relative to the benchmark in light of the REIT sector's positive absolute returns for the six-month period. Q Did the Fund's investment strategy change during the six-month period ended June 30, 2010? A Our investment strategy did not change materially during the period, nor did we make any significant changes to the Fund's portfolio. We continue to 4 Pioneer Real Estate Shares | Semiannual Report | 6/30/10 maintain a portfolio that is well diversified by property type and geography, making changes continually at the margin to overweight or underweight sectors and individual stocks depending upon our view of market conditions and company-specific variables, respectively. Q What holdings contributed positively to the Fund's performance over the six months ended June 30, 2010? A The Fund's overweight positions in top-performing DuPont Fabros Technology, which owns and operates wholesale data centers, the apartment REIT Equity Residential, and storage REIT Extra Space Storage were particularly rewarding to performance over the six-month period. DuPont Fabros Technology's performance was due in large part to the stabilized condition of the company's existing property portfolio and continued steady demand for wholesale data center space. The company's stock also enjoyed a favorable reception by investors to its equity offering in May 2010. The performance of Equity Residential reflected the defensive characteristics of the company's solid balance sheet, its high-quality portfolio, and the belief that the company is well positioned to benefit from rising rents in many of its core markets. Extra Space Storage's outperformance also was driven largely by the company's stable balance sheet and high-quality asset portfolio as well as its continued solid operating results and manageable development pipeline. Q What holdings proved most disappointing for the Fund during the six months ended June 30, 2010? A While the reporting period was very rewarding on an absolute and relative basis, there were some disappointments, including an overweight exposure to apartment REIT Camden Property Trust and hotel REIT PebbleBrook Hotel Trust. Camden was one of the strongest-performing multifamily companies in 2009, and so some retrenchment in its stock price during the first half of this year was not surprising and may have been attributable to profit-taking. The company's first quarter announcement of a reduction in its development and predevelopment activity, which resulted in a one-time impairment charge, also contributed to its underperformance. We continue to maintain a Fund overweight in Camden, as we believe it represents a solid relative value in the apartment sector and, given its strong balance sheet and solid management team, is well positioned to benefit from an eventual improvement in the apartment market's fundamentals. PebbleBrook Hotel Trust lagged its hotel peers during the six-month period due to management's decision not to deploy the majority of cash raised from its December 2009 initial public offering until late in the reporting period, when the company announced several acquisitions. We believe the company represents an attractive relative value in the hotel sector due to its unburdened balance sheet and enviable positioning, given its ability to continue acquiring high-quality assets. Pioneer Real Estate Shares | Semiannual Report | 6/30/10 5 Q Given the U.S. economy's uneven recovery, how have the various property types in which the Fund's assets are invested been faring? A Leasing demand fundamentals remain weak in most sectors and vacancy rates are at record levels in retail and industrial markets, and still deteriorating in most office markets. Some office market rents are down by more than 20% from their peak levels of a few years ago, and are down by even more if leasing incentives and tenant improvements are factored in. The apartment sector improved in the first half of 2010 and, by some measures, has seen occupancies improve substantially. That sector benefits from shorter leases in an economic recovery and, true to form, has been the earliest of the four major sectors to turn the corner, though the gains thus far have been modest. Outside of the apartment sector, there has been some improvement in the rate of decline in the rest of the major real estate sectors. Vacancy rates have been climbing at a much slower rate in recent quarters, and we still expect that such measures will begin to top out during 2010, though the recent weakness in labor markets could push that into 2011. Even rent declines have been flattening recently, and the NCREIF (National Council of Real Estate Investment Fiduciaries) Index of private real estate returns was modestly positive in the first quarter of 2010. That said, we feel it will take some time for markets to bottom out. Demand has been the primary driver of leasing weakness, as supply pipelines were never overly large and the credit crisis put many new and even ongoing projects on the shelf. Going forward, we expect net operating income (NOI) in the office, retail and, to some extent, industrial sectors to be held back by the expiration of leases signed before the downturn, with the office sector's NOI being the last to recover given the longer-term nature of those leases. In the hotel sector, revenue per available room (REVPAR) growth has been positive for much of 2010, although that is largely a function of comparisons to the depressed markets from a year earlier. Occupancies are running several percentage points ahead of 2009, but rates are flat. We believe hotel fundamentals should continue to improve through 2011, though they could be particularly sensitive to any lack of confidence in the business sector. Q What is your outlook for the balance of 2010? A The U.S. REIT market has made solid gains since the sector's rally began in March 2009. Companies have benefited from their ability to focus on streamlining operations and improving balance sheets. While the recent pullback has brought valuations to more realistic -- but still above average -- levels, we believe performance expectations for the remainder of 2010 should be tempered. We think prices have limited room to move much higher in the near term considering the current backdrop of uncertainty in 6 Pioneer Real Estate Shares | Semiannual Report | 6/30/10 the broader stock market and the economy. Economic data in June has indicated that the economy could be slowing, which, in turn, could put some pressure on the future NOI growth of REITs, and on property values. We expect the REIT sector's direction over the near term will continue to be guided by macroeconomic developments, such as conditions in the credit and job markets. Our investment process for the Fund will continue to focus on security selection within each property sector, emphasizing those companies that we believe represent the greatest relative value, the strongest price appreciation potential, and the lowest downside risk. 1 The MSCI information may only be used for your internal use, may not be reproduced or redisseminated in any form and may not be used as a basis for or a component of any financial instruments or products or indices. None of the MSCI information is intended to constitute investment advice or a recommendation to make (or refrain from making) any kind of investment decision and may not be relied on as such. Historical data and analysis should not be taken as an indication or guarantee of any future performance analysis, forecast or prediction. The MSCI information is provided on an "as is" basis and the user of this information assumes the entire risk of any use made of this information. MSCI, each of its affiliates and each other person involved in or related to compiling, computing or creating any MSCI information (collectively, the "MSCI Parties") expressly disclaims all warranties (including, without limitation, any warranties of originality, accuracy, completeness, timeliness, non-infringement, merchantability and fitness for a particular purpose) with respect to this information. Without limiting any of the foregoing, in no event shall any MSCI Party have any liability for any direct, indirect, special, incidental, punitive, consequential (including, without limitation, lost profits) or any other damages. (www.mscibarra.com) Please refer to the Schedule of Investments on pages 16-20 for a full listing of Fund securities. The Fund invests in REIT securities, the value of which can fall for a variety of reasons, such as declines in rental income, fluctuating interest rates, poor property management, environmental liabilities, uninsured damage, increased competition, or changes in real estate tax laws. At times, the Fund's investments may represent industries or industry sectors that are interrelated or have common risks, making it more susceptible to any economic, political, or regulatory developments or other risks affecting those industries or sectors. Past performance is no guarantee of future results, and there is no guarantee that market forecasts discussed will be realized. Any information in this shareholder report regarding market or economic trends or the factors influencing the Fund's historical or future performance are statements of the opinion of Fund management as of the date of this report. These statements should not be relied upon for any other purposes. Pioneer Real Estate Shares | Semiannual Report | 6/30/10 7 Portfolio Summary | 6/30/10 Portfolio Diversification -------------------------------------------------------------------------------- (As a percentage of total investment portfolio) [THE DATA BELOW IS REPRESENTED AS A PIE CHART IN THE PRINTED MATERIAL] U.S. Common Stocks 80.6% Temporary Cash Investments 19.4%
Sector Diversification -------------------------------------------------------------------------------- (As a percentage of equity holdings) [THE DATA BELOW IS REPRESENTED AS A PIE CHART IN THE PRINTED MATERIAL] Apartment 16.9% Office 14.2% Regional Mall 13.8% Health Care 11.5% Shopping Center 10.0% Industrial 7.9% Storage 7.8% Diversified 7.7% Hotel 6.0% Triple Net Lease 3.4% Manufactured Home 0.8%
10 Largest Holdings -------------------------------------------------------------------------------- (As a percentage of equity holdings) 1. Simon Property Group, Inc. 9.83% -------------------------------------------------------------------------------- 2. Equity Residential Property Trust 7.10 -------------------------------------------------------------------------------- 3. Public Storage, Inc. 5.12 -------------------------------------------------------------------------------- 4. Vornado Realty Trust 5.03 -------------------------------------------------------------------------------- 5. AvalonBay Communities, Inc. 5.02 -------------------------------------------------------------------------------- 6. Boston Properties, Inc. 4.97 -------------------------------------------------------------------------------- 7. HCP, Inc. 4.18 -------------------------------------------------------------------------------- 8. Host Hotels & Resorts, Inc. 4.03 -------------------------------------------------------------------------------- 9. Nationwide Health Properties, Inc. 3.99 -------------------------------------------------------------------------------- 10. The Macerich Co. 3.54 --------------------------------------------------------------------------------
* This list excludes temporary cash and derivative instruments. The portfolio is actively managed, and current holdings may be different. The holdings listed should not be considered recommendations to buy or sell any securities listed. 8 Pioneer Real Estate Shares | Semiannual Report | 6/30/10 Prices and Distributions | 6/30/10 Net Asset Value per Share --------------------------------------------------------------------------------
-------------------------------------------------------------------------------- Class 6/30/10 12/31/09 -------------------------------------------------------------------------------- A $17.22 $16.24 -------------------------------------------------------------------------------- B $16.99 $16.03 -------------------------------------------------------------------------------- C $17.01 $16.06 -------------------------------------------------------------------------------- Y $17.20 $16.23 --------------------------------------------------------------------------------
Distributions per Share: 1/1/10-6/30/10 --------------------------------------------------------------------------------
-------------------------------------------------------------------------------- Net Investment Short-Term Long-Term Class Income Capital Gains Capital Gains -------------------------------------------------------------------------------- A $0.1800 $ -- $ -- -------------------------------------------------------------------------------- B $0.0700 $ -- $ -- -------------------------------------------------------------------------------- C $0.1200 $ -- $ -- -------------------------------------------------------------------------------- Y $0.2400 $ -- $ -- --------------------------------------------------------------------------------
Pioneer Real Estate Shares | Semiannual Report | 6/30/10 9 Performance Update | 6/30/10 Class A Shares Investment Returns -------------------------------------------------------------------------------- The mountain chart on the right shows the change in value of a $10,000 investment made in Pioneer Real Estate Shares at public offering price, compared to that of the Morgan Stanley Capital International (MSCI) U.S. REIT Index. Average Annual Total Returns (As of June 30, 2010) ------------------------------------------------------------------------
Net Asset Public Offering Period Value (NAV) Price (POP) ------------------------------------------------------------------------ 10 Years 9.36% 8.72% 5 Years 0.28 -0.90 1 Year 54.43 45.51 ------------------------------------------------------------------------ Expense Ratio (Per prospectus dated May 1, 2010) ------------------------------------------------------------------------ Gross Net ------------------------------------------------------------------------ 1.85% 1.85% ------------------------------------------------------------------------
[THE DATA BELOW IS REPRESENTED AS A MOUNTAIN CHART IN THE PRINTED MATERIAL] Value of $10,000 Investment
Pioneer Real Estate Shares MSCI U.S. REIT Index 6/00 $ 9,425 $10,000 11,284 12,354 6/02 12,871 14,339 13,197 14,903 6/04 16,906 18,827 22,739 25,026 6/06 28,041 29,944 30,722 33,553 6/08 25,983 28,807 14,935 16,207 6/10 23,064 25,159
Call 1-800-225-6292 or visit www.pioneerinvestments.com for the most recent month-end performance results. Current performance may be lower or higher than the performance data quoted. The performance data quoted represents past performance, which is no guarantee of future results. Investment return and principal value will fluctuate, and shares, when redeemed, may be worth more or less than their original cost. NAV results represent the percent change in net asset value per share. Returns would have been lower had sales charges been reflected. POP returns reflect deduction of maximum 5.75% sales charge. All results are historical and assume the reinvestment of dividends and capital gains. Other share classes are available for which performance and expenses will differ. Performance results reflect any applicable expense waivers in effect during the periods shown. Without such waivers Fund performance would be lower. Waivers may not be in effect for all funds. Certain fee waivers are contractual through a specified period. Otherwise, fee waivers can be rescinded at any time. See the prospectus and financial statements for more information. The performance table and graph do not reflect the deduction of fees and taxes that a shareowner would pay on Fund distributions or the redemption of Fund shares. The MSCI U.S. REIT Index is a widely used index comprising a broad representation of the most actively traded real estate trusts, and is designed to be a measure of real estate equity performance. Index returns assume reinvestment of dividends and, unlike Fund returns, do not reflect any fees, expenses or sales charges. You cannot invest directly in an index. 10 Pioneer Real Estate Shares | Semiannual Report | 6/30/10 Performance Update | 6/30/10 Class B Shares Investment Returns -------------------------------------------------------------------------------- The mountain chart on the right shows the change in value of a $10,000 investment made in Pioneer Real Estate Shares, compared to that of the Morgan Stanley Capital International (MSCI) U.S. REIT Index. Average Annual Total Returns (As of June 30, 2010) --------------------------------------------------------------------------------
If If Period Held Redeemed -------------------------------------------------------------------------------- 10 Years 8.32% 8.32% 5 Years -0.81 -0.81 1 Year 52.49 48.49 -------------------------------------------------------------------------------- Expense Ratio (Per prospectus dated May 1, 2010) -------------------------------------------------------------------------------- Gross Net -------------------------------------------------------------------------------- 3.25% 3.25% --------------------------------------------------------------------------------
[THE DATA BELOW IS REPRESENTED AS A MOUNTAIN CHART IN THE PRINTED MATERIAL] Value of $10,000 Investment
Pioneer Real Estate Shares MSCI U.S. REIT Index 6/00 $10,000 $10,000 11,875 12,354 6/02 13,435 14,339 13,669 14,903 6/04 17,370 18,827 23,166 25,026 6/06 28,302 29,944 30,736 33,553 6/08 25,736 28,807 14,583 16,207 6/10 22,237 25,159
Call 1-800-225-6292 or visit www.pioneerinvestments.com for the most recent month-end performance results. Current performance may be lower or higher than the performance data quoted. The performance data quoted represents past performance, which is no guarantee of future results. Investment return and principal value will fluctuate, and shares, when redeemed, may be worth more or less than their original cost. "If Held" results represent the percent change in net asset value per share. Returns would have been lower had sales charges been reflected. "If redeemed" returns reflect the deduction of applicable contingent deferred sales charge (CDSC). Effective December 1, 2004, the period during which a CDSC is applied to withdrawals was shortened to 5 years. The maximum CDSC for Class B shares continues to be 4%. For more complete information, please see the prospectus. Note: Shares purchased prior to December 1, 2004, remain subject to the CDSC in effect at the time you purchased those shares. For performance information for shares purchased prior to December 1, 2004, please visit www.pioneerinvestments.com. All results are historical and assume the reinvestment of dividends and capital gains. Other share classes are available for which performance and expenses will differ. Performance results reflect any applicable expense waivers in effect during the periods shown. Without such waivers Fund performance would be lower. Waivers may not be in effect for all funds. Certain fee waivers are contractual through a specified period. Otherwise, fee waivers can be rescinded at any time. See the prospectus and financial statements for more information. The performance table and graph do not reflect the deduction of fees and taxes that a shareowner would pay on Fund distributions or the redemption of Fund shares. The MSCI U.S. REIT Index is a widely used index comprising a broad representation of the most actively traded real estate trusts, and is designed to be a measure of real estate equity performance. Index returns assume reinvestment of dividends and, unlike Fund returns, do not reflect any fees, expenses or sales charges. You cannot invest directly in an index. Pioneer Real Estate Shares | Semiannual Report | 6/30/10 11 Performance Update | 6/30/10 Class C Shares Investment Returns -------------------------------------------------------------------------------- The mountain chart on the right shows the change in value of a $10,000 investment made in Pioneer Real Estate Shares, compared to that of the Morgan Stanley Capital International (MSCI) U.S. REIT Index. Average Annual Total Returns (As of June 30, 2010) --------------------------------------------------------------------------------
If If Period Held Redeemed -------------------------------------------------------------------------------- 10 Years 8.46% 8.46% 5 Years -0.60 -0.60 1 Year 53.07 53.07 -------------------------------------------------------------------------------- Expense Ratio (Per prospectus dated May 1, 2010) -------------------------------------------------------------------------------- Gross Net -------------------------------------------------------------------------------- 2.89% 2.89% --------------------------------------------------------------------------------
[THE DATA BELOW IS REPRESENTED AS A MOUNTAIN CHART IN THE PRINTED MATERIAL] Value of $10,000 Investment
Pioneer Real Estate Shares MSCI U.S. REIT Index 6/00 $10,000 $10,000 11,868 12,354 6/02 13,434 14,339 13,678 14,903 6/04 17,389 18,827 23,212 25,026 6/06 28,385 29,944 30,836 33,553 6/08 25,853 28,807 14,713 16,207 6/10 22,522 25,159
Call 1-800-225-6292 or visit www.pioneerinvestments.com for the most recent month-end performance results. Current performance may be lower or higher than the performance data quoted. The performance data quoted represents past performance, which is no guarantee of future results. Investment return and principal value will fluctuate, and shares, when redeemed, may be worth more or less than their original cost. Class C shares held for less than one year are also subject to a 1% contingent deferred sales charge (CDSC). The performance of Class C shares does not reflect the 1% front-end sales charge in effect prior to February 1, 2004. If you paid a 1% sales charge, your returns would be lower than those shown above. "If Held" results represent the percent change in net asset value per share. Returns would have been lower had sales charges been reflected. All results are historical and assume the reinvestment of dividends and capital gains. Other share classes are available for which performance and expenses will differ. Performance results reflect any applicable expense waivers in effect during the periods shown. Without such waivers Fund performance would be lower. Waivers may not be in effect for all funds. Certain fee waivers are contractual through a specified period. Otherwise, fee waivers can be rescinded at any time. See the prospectus and financial statements for more information. The performance table and graph do not reflect the deduction of fees and taxes that a shareowner would pay on Fund distributions or the redemption of Fund shares. The MSCI U.S. REIT Index is a widely used index comprising a broad representation of the most actively traded real estate trusts, and is designed to be a measure of real estate equity performance. Index returns assume reinvestment of dividends and, unlike Fund returns, do not reflect any fees, expenses or sales charges. You cannot invest directly in an index. 12 Pioneer Real Estate Shares | Semiannual Report | 6/30/10 Performance Update | 6/30/10 Class Y Shares Investment Returns -------------------------------------------------------------------------------- The mountain chart on the right shows the change in value of a $10,000 investment made in Pioneer Real Estate Shares, compared to that of the Morgan Stanley Capital International (MSCI) U.S. REIT Index. Average Annual Total Returns (As of June 30, 2010) --------------------------------------------------------------------------------
If If Period Held Redeemed -------------------------------------------------------------------------------- 10 Years 9.99% 9.99% 5 Years 0.90 0.90 1 Year 55.46 55.46 -------------------------------------------------------------------------------- Expense Ratio (Per prospectus dated May 1, 2010) -------------------------------------------------------------------------------- Gross Net -------------------------------------------------------------------------------- 1.06% 1.06% --------------------------------------------------------------------------------
[THE DATA BELOW IS REPRESENTED AS A MOUNTAIN CHART IN THE PRINTED MATERIAL] Value of $10,000 Investment
Pioneer Real Estate Shares MSCI U.S. REIT Index 6/00 $10,000 $10,000 12,029 12,354 6/02 13,786 14,339 14,228 14,903 6/04 18,331 18,827 24,778 25,026 6/06 30,709 29,944 33,809 33,553 6/08 28,745 28,807 16,672 16,207 6/10 25,919 25,159
Call 1-800-225-6292 or visit www.pioneerinvestments.com for the most recent month-end performance results. Current performance may be lower or higher than the performance data quoted. The performance data quoted represents past performance, which is no guarantee of future results. Investment return and principal value will fluctuate, and shares, when redeemed, may be worth more or less than their original cost. Class Y shares are not subject to sales charges and are available for limited groups of eligible investors, including institutional investors. All results are historical and assume the reinvestment of dividends and capital gains. Other share classes are available for which performance and expenses will differ. Performance results reflect any applicable expense waivers in effect during the periods shown. Without such waivers Fund performance would be lower. Waivers may not be in effect for all funds. Certain fee waivers are contractual through a specified period. Otherwise, fee waivers can be rescinded at any time. See the prospectus and financial statements for more information. The performance table and graph do not reflect the deduction of fees and taxes that a shareowner would pay on Fund distributions or the redemption of Fund shares. The MSCI U.S. REIT Index is a widely used index comprising a broad representation of the most actively traded real estate trusts, and is designed to be a measure of real estate equity performance. Index returns assume reinvestment of dividends and, unlike Fund returns, do not reflect any fees, expenses or sales charges. You cannot invest directly in an index. Pioneer Real Estate Shares | Semiannual Report | 6/30/10 13 Comparing Ongoing Fund Expenses As a shareowner in the Fund, you incur two types of costs: (1) ongoing costs, including management fees, distribution and/or service (12b-1) fees, and other Fund expenses; and (2) transaction costs, including sales charges (loads) on purchase payments. This example is intended to help you understand your ongoing expenses (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds. The example is based on an investment of $1,000 at the beginning of the Fund's latest six-month period and held throughout the six months. Using the Tables -------------------------------------------------------------------------------- Actual Expenses The first table below provides information about actual account values and actual expenses. You may use the information in this table, together with the amount you invested, to estimate the expenses that you paid over the period as follows: (1) Divide your account value by $1,000 Example: an $8,600 account value [divided by] $1,000 = 8.6 (2) Multiply the result in (1) above by the corresponding share class's number in the third row under the heading entitled "Expenses Paid During Period" to estimate the expenses you paid on your account during this period. Expenses Paid on a $1,000 Investment in Pioneer Real Estate Shares Based on actual returns from January 1, 2010 through June 30, 2010.
----------------------------------------------------------------------------------- Share Class A B C Y ----------------------------------------------------------------------------------- Beginning Account $1,000.00 $1,000.00 $1,000.00 $1,000.00 Value on 1/1/10 ----------------------------------------------------------------------------------- Ending Account $1,071.10 $1,064.10 $1,066.40 $1,074.10 Value on 6/30/10 ----------------------------------------------------------------------------------- Expenses Paid $8.42 $15.05 $12.81 $5.14 During Period* -----------------------------------------------------------------------------------
* Expenses are equal to the Fund's annualized expense ratio of 1.64%, 2.94%, 2.50% and 1.00% for Class A, Class B, Class C and Class Y shares, respectively, multiplied by the average account value over the period, multiplied by 181/365 (to reflect the one-half year period). 14 Pioneer Real Estate Shares | Semiannual Report | 6/30/10 Hypothetical Example for Comparison Purposes The table below provides information about hypothetical account values and hypothetical expenses based on the Fund's actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund's actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds. Please note that the expenses shown in the tables are meant to highlight your ongoing costs only and do not reflect any transaction costs, such as sales charges (loads) that are charged at the time of the transaction. Therefore, the table below is useful in comparing ongoing costs only and will not help you determine the relative total costs of owning different funds. In addition, if these transaction costs were included, your costs would have been higher. Expenses Paid on a $1,000 Investment in Pioneer Real Estate Shares Based on a hypothetical 5% return per year before expenses, reflecting the period from January 1, 2010 through June 30, 2010.
----------------------------------------------------------------------------------- Share Class A B C Y ----------------------------------------------------------------------------------- Beginning Account $1,000.00 $1,000.00 $1,000.00 $1,000.00 Value on 1/1/10 ----------------------------------------------------------------------------------- Ending Account $1,016.66 $1,010.22 $1,012.40 $1,019.84 Value on 6/30/10 ----------------------------------------------------------------------------------- Expenses Paid $8.20 $14.65 $12.47 $5.01 During Period* -----------------------------------------------------------------------------------
* Expenses are equal to the Fund's annualized expense ratio of 1.64%, 2.94%, 2.50% and 1.00% for Class A, Class B, Class C and Class Y shares, respectively, multiplied by the average account value over the period, multiplied by 181/365 (to reflect the one-half year period). Pioneer Real Estate Shares | Semiannual Report | 6/30/10 15 Schedule of Investments | 6/30/10 (unaudited)
Shares Value COMMON STOCKS -- 98.5% CONSUMER SERVICES -- 1.4% Hotels, Resorts & Cruise Lines -- 1.4% 42,600 Starwood Hotels & Resorts Worldwide, Inc. $ 1,764,918 ------------ Total Consumer Services $ 1,764,918 --------------------------------------------------------------------------------- REAL ESTATE -- 97.1% Diversified Real Estate Activities -- 0.6% 39,500 Pebblebrook Hotel Trust* $ 744,575 --------------------------------------------------------------------------------- Diversified Real Estate Investment Trusts -- 8.8% 21,200 Excel Trust, Inc.* $ 254,400 131,500 Liberty Property Trust (b) 3,793,775 90,900 Retail Opportunity Investment Corp. 877,185 87,200 Vornado Realty Trust (b) 6,361,240 ------------ $ 11,286,600 --------------------------------------------------------------------------------- Industrial Real Estate Investment Trusts -- 7.2% 100,500 AMB Property Corp. $ 2,382,855 520,100 DCT Industrial Trust, Inc. (b) 2,350,852 125,800 Dupont Fabros Technology, Inc. 3,089,648 102,000 First Potomac Realty Trust 1,465,740 ------------ $ 9,289,095 --------------------------------------------------------------------------------- Office Real Estate Investment Trusts -- 14.3% 15,700 Alexandria Real Estate Equities, Inc. (b) $ 994,909 150,000 BioMed Property Trust, Inc. (b) 2,413,500 88,000 Boston Properties, Inc. (b) 6,277,920 47,000 Digital Realty Trust, Inc. (b) 2,710,960 26,900 Hudson Pacific Properties, Inc.* 464,025 114,300 Kilroy Realty Corp. 3,398,139 21,300 Mack-Cali Realty Corp. 633,249 76,700 Piedmont Office Realty Trust, Inc. (b) 1,436,591 ------------ $ 18,329,293 --------------------------------------------------------------------------------- Residential Real Estate Investment Trusts -- 17.5% 67,900 AvalonBay Communities, Inc.*(b) $ 6,339,823 90,700 Camden Property Trust*(b) 3,705,095 22,100 Equity Lifestyle Properties, Inc. 1,065,883 215,500 Equity Residential Property Trust 8,973,420 23,900 Essex Property Trust, Inc. (b) 2,331,206 ------------ $ 22,415,427 --------------------------------------------------------------------------------- Retail Real Estate Investment Trusts -- 24.1% 46,800 Developers Diversified Realty Corp. $ 463,320 63,700 Federal Realty Investment Trust (b) 4,476,199 95,600 Kimco Realty Corp. 1,284,864 239,800 Kite Realty Group Trust 1,002,364 79,000 National Retail Properties, Inc. (b) 1,693,760 69,000 Ramco-Gershenson Properties Trust 696,900
The accompanying notes are an integral part of these financial statements. 16 Pioneer Real Estate Shares | Semiannual Report | 6/30/10
Shares Value Retail Real Estate Investment Trusts -- (continued) 15,600 Realty Income Corp. (b) $ 473,148 99,800 Regency Centers Corp. (b) 3,433,120 153,881 Simon Property Group, Inc. 12,425,891 15,100 Taubman Centers, Inc. (b) 568,213 120,000 The Macerich Co. (b) 4,478,400 ------------ $ 30,996,179 ---------------------------------------------------------------------------------- Specialized Real Estate Investment Trusts -- 24.6% 55,500 Entertainment Properties Trust (b) $ 2,112,885 248,900 Extra Space Storage, Inc. 3,459,710 164,000 HCP, Inc. (b) 5,289,000 23,300 HealthCare REIT, Inc. (b) 981,396 378,000 Host Hotels & Resorts, Inc. 5,095,440 141,000 Nationwide Health Properties, Inc. 5,043,570 157,300 Omega Healthcare Investors, Inc. (b) 3,134,989 73,600 Public Storage, Inc. 6,470,176 ------------ $ 31,587,166 ------------ Total Real Estate $124,648,335 ---------------------------------------------------------------------------------- TOTAL COMMON STOCKS (Cost $86,045,963) $126,413,253 ---------------------------------------------------------------------------------- ---------------------------------------------------------------------------------- Principal Amount($) ---------------------------------------------------------------------------------- TEMPORARY CASH INVESTMENTS -- 23.7% Securities Lending Collateral -- 23.7% (c) Certificates of Deposit: 882,717 Bank of Nova Scotia, 0.47%, 9/7/10 $ 882,717 882,717 Barclays, 0.30%, 7/23/10 882,717 970,989 CBA Financial, 0.56%, 1/3/11 970,989 882,717 Deutschebank, 0.30%, 7/19/10 882,717 529,630 DnB NOR Bank ASA NY, 0.49%, 8/26/10 529,630 882,718 Rabobank Nederland NY, 0.23%, 7/6/10 882,718 882,717 Royal Bank of Canada, 0.26%, 1/21/11 882,717 882,717 Svenska NY, 0.265%, 7/19/10 882,717 ------------ $ 6,796,922 ---------------------------------------------------------------------------------- Commercial Paper: 529,630 American Honda Finance, 0.38%, 5/4/11 $ 529,630 353,087 American Honda Finance, 0.38%, 4/15/11 353,087 116,780 Caterpillar Financial Services, 0.47%, 8/20/10 116,780 882,882 Federal Home Loan Bank, 0.31%, 6/1/11 882,882 353,037 NABPP, 0.28%, 7/19/10 353,037 441,163 PARFIN, 0.39%, 8/11/10 441,163 882,683 SOCNAM, 0.28%, 7/6/10 882,683 705,696 CHARF, 0.46%, 8/23/10 705,696 529,220 CLIPPR, 0.45%, 9/1/10 529,220
The accompanying notes are an integral part of these financial statements. Pioneer Real Estate Shares | Semiannual Report | 6/30/10 17 Schedule of Investments | 6/30/10 (unaudited) (continued)
---------------------------------------------------------------------------------- Principal Amount($) ---------------------------------------------------------------------------------- Commercial Paper -- (continued) 367,399 FAIRPP, 0.50%, 8/16/10 $ 367,399 441,003 FASCO, 0.46%, 9/2/10 441,003 405,695 FASCO, 0.45%, 9/9/10 405,695 617,875 SRCPP, 0.26%, 7/7/10 617,875 619,346 STRAIT, 0.43%, 8/23/10 619,346 425,850 TBLLC, 0.40%, 8/9/10 425,850 882,539 Varfun, 0.29%, 7/26/10 882,539 798,077 CME, Inc., 1.00%, 8/6/10 798,077 264,866 GE Capital Corp., 0.64%, 8/20/10 264,866 95,550 GE Capital Corp., 0.40%, 10/21/10 95,550 96,210 GE Capital Corp., 0.35%, 10/6/10 96,210 441,313 GE, 0.37%, 1/26/11 441,313 88,196 GE Capital Corp., 0.33%, 6/6/11 88,196 98,426 John Deere Capital Corp., 0.32%, 7/16/10 98,426 746,464 JPMorgan Chase & Co., 0.57%, 9/24/10 746,464 1,000,751 Santander, 0.30%, 7/23/10 1,000,751 882,717 Toyota Motor Credit Corp., 0.35%, 1/10/11 882,717 529,662 Wachovia, 0.64%, 3/22/11 529,662 247,187 Wal-Mart Stores, Inc., 0.22%, 7/1/10 247,187 353,028 WFC, 0.60%, 12/2/10 353,028 882,717 WESTPAC, 0.39%, 11/5/10 882,717 ------------ $ 15,079,049 ---------------------------------------------------------------------------------- Tri-party Repurchase Agreements: 1,107,457 Barclays, 0.1%, 7/1/10 $ 1,107,457 2,206,793 Deutsche Bank, 0.3%, 7/1/10 2,206,793 2,648,152 RBS Securities, Inc., 0.5%, 7/1/10 2,648,152 ------------ $ 5,962,402 ---------------------------------------------------------------------------------- ---------------------------------------------------------------------------------- Shares ---------------------------------------------------------------------------------- Money Market Mutual Funds: 1,324,076 Blackrock Liquidity Temp Cash Fund $ 1,324,076 1,324,076 Dreyfus Preferred Money Market Fund 1,324,076 ------------ $ 2,648,152 ------------ Total Securities Lending Collateral $ 30,486,525 ---------------------------------------------------------------------------------- TOTAL TEMPORARY CASH INVESTMENTS (Cost $30,486,525) $ 30,486,525 ---------------------------------------------------------------------------------- TOTAL INVESTMENT IN SECURITIES -- 122.2% (Cost $116,532,488) (a) $156,899,778 ---------------------------------------------------------------------------------- OTHER ASSETS AND LIABILITIES -- (22.2)% $(28,479,460) ---------------------------------------------------------------------------------- TOTAL NET ASSETS -- 100.0% $128,420,318 ==================================================================================
The accompanying notes are an integral part of these financial statements. 18 Pioneer Real Estate Shares | Semiannual Report | 6/30/10 * Non-income producing security. (a) At June 30, 2010, the net unrealized gain on investments based on cost for federal income tax purposes of $124,394,309 was as follows: Aggregate gross unrealized gain for all investments in which there is an excess of value over tax cost $ 44,027,095 Aggregate gross unrealized loss for all investments in which there is an excess of tax cost over value (11,521,626) ------------ Net unrealized gain $32,505,469 ------------
(b) At June 30, 2010, the following securities were out on loan:
Shares Security Value 5,000 Alexandria Real Estate Equities, Inc. $ 316,850 41,800 AvalonBay Communities, Inc. * 3,902,866 115,600 BioMed Property Trust, Inc. 1,860,004 11,500 Boston Properties, Inc. 820,410 35,400 Camden Property Trust * 1,446,090 130,000 DCT Industrial Trust, Inc. 587,600 47,000 Digital Realty Trust, Inc. 2,710,960 25,100 Entertainment Properties Trust 955,557 13,050 Essex Property Trust, Inc. 1,272,897 1,000 Federal Realty Investment Trust 70,270 24,300 HCP, Inc. 783,675 12,200 HealthCare REIT, Inc. 513,864 25,000 Liberty Property Trust 721,250 118,800 The Macerich Co. 4,433,616 77,000 National Retail Properties, Inc. 1,650,880 24,400 Omega Healthcare Investors, Inc. 486,292 52,200 Piedmont Office Realty Trust, Inc. 977,706 15,400 Realty Income Corp. 467,082 78,500 Regency Centers Corp. 2,700,400 12,300 Taubman Centers, Inc. 462,849 34,400 Vornado Realty Trust 2,509,480 --------------------------------------------------------------------------------- Total $29,650,598 =================================================================================
(c) Securities lending collateral is managed by Credit Suisse AG, New York Branch. Purchases and sales of securities (excluding temporary cash investments) for the six months ended June 30, 2010 aggregated $6,180,320 and $12,552,739, respectively. Various inputs are used in determining the value of the Fund's investments. These inputs are summarized in the three broad levels listed below. The accompanying notes are an integral part of these financial statements. Pioneer Real Estate Shares | Semiannual Report | 6/30/10 19 Schedule of Investments | 6/30/10 (unaudited) (continued) Highest priority is given to Level 1 inputs and lowest priority is given to Level 3. Level 1 -- quoted prices in active markets for identical securities Level 2 -- other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds, credit risk, etc.) Level 3 -- significant unobservable inputs (including the Fund's own assumptions in determining fair value of investments) The following is a summary of the inputs used as of June 30, 2010, in valuing the Fund's assets:
---------------------------------------------------------------------------------------------- Level 1 Level 2 Level 3 Total ---------------------------------------------------------------------------------------------- Common Stocks $126,413,253 $ -- $ -- $126,413,253 Temporary Cash Investments -- 27,838,373 -- 27,838,373 Money Market Mutual Funds 2,648,152 -- -- 2,648,152 ---------------------------------------------------------------------------------------------- Total $129,061,405 $27,838,373 $ -- $156,899,778 ==============================================================================================
The accompanying notes are an integral part of these financial statements. 20 Pioneer Real Estate Shares | Semiannual Report | 6/30/10 Statement of Assets and Liabilities | 6/30/10 (unaudited) ASSETS: Investment in securities (including securities loaned of $29,650,598)(cost $116,532,488) $156,899,778 Cash 1,387,791 Receivables -- Investment securities sold 499,785 Fund shares sold 24,741 Dividends and interest 507,845 Other 35,720 --------------------------------------------------------------------------- Total assets $159,355,660 --------------------------------------------------------------------------- LIABILITIES: Payables -- Investment securities purchased $ 304,929 Fund shares repurchased 66,922 Upon return of securities loaned 30,486,525 Due to affiliates 38,369 Accrued expenses 38,597 --------------------------------------------------------------------------- Total liabilities $ 30,935,342 --------------------------------------------------------------------------- NET ASSETS: Paid-in capital $124,584,245 Undistributed net investment income 72,371 Accumulated net realized loss on investments (36,603,588) Net unrealized gain on investments 40,367,290 --------------------------------------------------------------------------- Total net assets $128,420,318 --------------------------------------------------------------------------- NET ASSET VALUE PER SHARE: (No par value, unlimited number of shares authorized) Class A (based on $68,649,830/3,986,586 shares) $ 17.22 Class B (based on $8,203,380/482,814 shares) $ 16.99 Class C (based on $10,098,519/593,607 shares) $ 17.01 Class Y (based on $41,468,589/2,410,481 shares) $ 17.20 MAXIMUM OFFERING PRICE: Class A ($17.22 [divided by] 94.25%) $ 18.27 ===========================================================================
The accompanying notes are an integral part of these financial statements. Pioneer Real Estate Shares | Semiannual Report | 6/30/10 21 Statement of Operations (unaudited) For the Six Months Ended 6/30/10 INVESTMENT INCOME: Dividends $2,500,547 Interest 580 Income from securities loaned, net 40,015 ------------------------------------------------------------------------------------- Total investment income $2,541,142 ------------------------------------------------------------------------------------- EXPENSES: Management fees $ 527,492 Transfer agent fees and expenses Class A 103,890 Class B 29,495 Class C 21,184 Class Y 220 Distribution fees Class A 86,911 Class B 43,462 Class C 48,994 Shareholder communications expense 48,237 Administrative reimbursements 19,892 Custodian fees 4,831 Registration fees 26,279 Professional fees 31,479 Printing expense 29,226 Fees and expenses of nonaffiliated trustees 3,569 Miscellaneous 14,030 ------------------------------------------------------------------------------------- Total expenses $1,039,191 ------------------------------------------------------------------------------------- Net expenses $1,039,191 ------------------------------------------------------------------------------------- Net investment income $1,501,951 ------------------------------------------------------------------------------------- REALIZED AND UNREALIZED GAIN ON INVESTMENTS: Net realized gain on investments $ 69,746 ------------------------------------------------------------------------------------- Change in net unrealized gain on investments $7,490,735 ------------------------------------------------------------------------------------- Net gain on investments $7,560,481 ------------------------------------------------------------------------------------- Net increase in net assets resulting from operations $9,062,432 =====================================================================================
The accompanying notes are an integral part of these financial statements. 22 Pioneer Real Estate Shares | Semiannual Report | 6/30/10 Statement of Changes in Net Assets For the Six Months Ended 6/30/10 and the Year Ended 12/31/09, respectively
Six Months Ended 6/30/10 Year Ended (unaudited) 12/31/09 FROM OPERATIONS: Net investment income $ 1,501,951 $ 2,739,314 Net realized gain (loss) on investments 69,746 (25,661,256) Change in net unrealized gain on investments 7,490,735 53,330,486 ------------------------------------------------------------------------------------------------ Net increase in net assets resulting from operations $ 9,062,432 $ 30,408,544 ------------------------------------------------------------------------------------------------ DISTRIBUTIONS TO SHAREOWNERS: Net investment income: Class A ($0.18 and $0.34 per share, respectively) $ (726,480) $ (1,438,940) Class B ($0.07 and $0.18 per share, respectively) (35,075) (102,822) Class C ($0.12 and $0.22 per share, respectively) (68,698) (123,573) Class Y ($0.24 and $0.45 per share, respectively) (599,327) (1,073,979) Tax return of capital: Class A ($0.00 and $0.14 per share, respectively) -- (601,023) Class B ($0.00 and $0.14 per share, respectively) -- (82,898) Class C ($0.00 and $0.14 per share, respectively) -- (80,134) Class Y ($0.00 and $0.14 per share, respectively) -- (341,939) ------------------------------------------------------------------------------------------------ Total distributions to shareowners $ (1,429,580) $ (3,845,308) ------------------------------------------------------------------------------------------------ FROM FUND SHARE TRANSACTIONS: Net proceeds from sale of shares $ 12,814,462 $ 22,897,579 Reinvestment of distributions 768,430 2,404,017 Cost of shares repurchased (20,744,637) (21,548,877) ------------------------------------------------------------------------------------------------ Net increase (decrease) in net assets resulting from Fund share transactions $ (7,161,745) $ 3,752,719 ------------------------------------------------------------------------------------------------ Net increase (decrease) in net assets $ 471,107 $ 30,315,955 NET ASSETS: Beginning of period 127,949,211 97,633,256 ------------------------------------------------------------------------------------------------ End of period $128,420,318 $127,949,211 ------------------------------------------------------------------------------------------------ Undistributed net investment income $ 72,371 $ -- ================================================================================================
The accompanying notes are an integral part of these financial statements. Pioneer Real Estate Shares | Semiannual Report | 6/30/10 23 Statement of Changes in Net Assets (continued)
----------------------------------------------------------------------------------------------- '10 Shares '10 Amount '09 Shares '09 Amount (unaudited) (unaudited) ----------------------------------------------------------------------------------------------- Class A Shares sold 473,167 $ 8,411,906 1,045,870 $12,568,673 Reinvestment of distributions 37,394 667,349 140,891 1,676,324 Less shares repurchased (680,977) (11,844,957) (1,288,054) (15,497,747) ----------------------------------------------------------------------------------------------- Net decrease (170,416) $(2,765,702) (101,293) $(1,252,750) =============================================================================================== Class B Shares sold 79,513 $ 1,434,750 81,080 $ 964,620 Reinvestment of distributions 1,921.00 33,887 15,601 176,412 Less shares repurchased (144,726) (2,515,469) (207,052) (2,430,205) ----------------------------------------------------------------------------------------------- Net decrease (63,292) $(1,046,832) (110,371) $(1,289,173) =============================================================================================== Class C Shares sold 115,054 $ 2,018,703 151,985 $ 1,984,736 Reinvestment of distributions 3,417 60,267 15,004 173,266 Less shares repurchased (94,895) (1,634,918) (189,338) (2,312,012) ----------------------------------------------------------------------------------------------- Net increase (decrease) 23,576 $ 444,052 (22,349) $ (154,010) =============================================================================================== Class Y Shares sold 51,551 $ 949,103 665,022 $ 7,379,550 Reinvestment of distributions 389 6,927 41,332 378,015 Less shares repurchased (262,643) (4,749,293) (105,841) (1,308,913) ----------------------------------------------------------------------------------------------- Net increase (decrease) (210,703) $(3,793,263) 600,513 $ 6,448,652 ===============================================================================================
The accompanying notes are an integral part of these financial statements. 24 Pioneer Real Estate Shares | Semiannual Report | 6/30/10
Financial Highlights Six Months Ended 6/30/10 Year Ended (unaudited) 12/31/09 Class A Net asset value, beginning of year $ 16.24 $ 13.00 -------------------------------------------------------------------------------------------- Increase (decrease) from investment operations: Net investment income $ 0.19 $ 0.35 Net realized and unrealized gain (loss) on investments 0.97 3.37 -------------------------------------------------------------------------------------------- Net increase (decrease) from investment operations $ 1.16 $ 3.72 Distributions to shareowners: Net investment income (0.18) (0.34) Net realized gain -- -- Tax return of capital -- (0.14) -------------------------------------------------------------------------------------------- Net increase (decrease) in net asset value $ 0.98 $ 3.24 -------------------------------------------------------------------------------------------- Net asset value, end of period $ 17.22 $ 16.24 ============================================================================================ Total return* 7.11% 30.15% Ratio of net expenses to average net assets+ 1.64%** 1.85% Ratio of net investment income to average net assets+ 2.22%** 2.77% Portfolio turnover rate 10%** 23% Net assets, end of period (in thousands) $68,650 $67,510 Ratios with no waiver of fees and assumption of expenses by the Adviser and no reduction for fees paid indirectly: Net expenses 1.64%** 1.85% Net investment income 2.22%** 2.77% Ratios with waiver of fees and assumption of expenses by the Adviser and reduction for fees paid indirectly: Net expenses 1.64%** 1.85% Net investment income 2.22%** 2.77% ============================================================================================ Year Ended Year Ended Year Ended Year Ended 12/31/08 12/31/07 12/31/06 12/31/05 Class A Net asset value, beginning of year $ 21.94 $ 33.07 $ 25.87 $ 24.52 ---------------------------------------------------------------------------------------------------------------------- Increase (decrease) from investment operations: Net investment income $ 0.43 $ 0.36 $ 0.28 $ 0.28 Net realized and unrealized gain (loss) on investments (8.62) (6.76) 8.88 3.29 ---------------------------------------------------------------------------------------------------------------------- Net increase (decrease) from investment operations $ (8.19) $ (6.40) $ 9.16 $ 3.57 Distributions to shareowners: Net investment income (0.46) (0.36) (0.28) (0.24) Net realized gain -- (4.37) (1.68) (1.84) Tax return of capital (0.29) -- -- (0.14) ---------------------------------------------------------------------------------------------------------------------- Net increase (decrease) in net asset value $ (8.94) $(11.13) $ 7.20 $ 1.35 ---------------------------------------------------------------------------------------------------------------------- Net asset value, end of period $ 13.00 $ 21.94 $ 33.07 $ 25.87 ====================================================================================================================== Total return* (38.31)% (19.39)% 35.79% 14.79% Ratio of net expenses to average net assets+ 1.63% 1.36% 1.37% 1.50% Ratio of net investment income to average net assets+ 2.10% 1.10% 0.98% 1.14% Portfolio turnover rate 18% 21% 20% 24% Net assets, end of period (in thousands) $55,353 $97,691 $163,088 $110,217 Ratios with no waiver of fees and assumption of expenses by the Adviser and no reduction for fees paid indirectly: Net expenses 1.63% 1.36% 1.37% 1.50% Net investment income 2.10% 1.10% 0.98% 1.14% Ratios with waiver of fees and assumption of expenses by the Adviser and reduction for fees paid indirectly: Net expenses 1.63% 1.35% 1.36% 1.50% Net investment income 2.10% 1.11% 0.99% 1.14% ======================================================================================================================
* Assumes initial investment at net asset value at the beginning of each period, reinvestment of all distributions, the complete redemption of the investment at net asset value at the end of each period, and no sales charges. Total return would be reduced if sales charges were taken into account. ** Annualized. + Ratio with no reduction for fees paid indirectly. The accompanying notes are an integral part of these financial statements. Pioneer Real Estate Shares | Semiannual Report | 6/30/10 25 Financial Highlights (continued)
Six Months Ended 6/30/10 Year Ended Year Ended (unaudited) 12/31/09 12/31/08 Class B Net asset value, beginning of year $16.03 $12.84 $ 21.68 --------------------------------------------------------------------------------------------------------- Increase (decrease) from investment operations: Net investment income $ 0.08 $ 0.17 $ 0.19 Net realized and unrealized gain (loss) on investments 0.95 3.34 (8.50) --------------------------------------------------------------------------------------------------------- Net increase (decrease) from investment operations $ 1.03 $ 3.51 $ (8.31) Distributions to shareowners: Net investment income (0.07) (0.18) (0.24) Net realized gain -- -- -- Tax return of capital -- (0.14) (0.29) --------------------------------------------------------------------------------------------------------- Net increase (decrease) in net asset value $ 0.96 $ 3.19 $ (8.84) --------------------------------------------------------------------------------------------------------- Net asset value, end of period $16.99 $16.03 $ 12.84 ========================================================================================================= Total return* 6.41% 28.38% (39.01)% Ratio of net expenses to average net assets+ 2.94%** 3.25% 2.72% Ratio of net investment income to average net assets+ 0.90%** 1.41% 0.89% Portfolio turnover rate 10%** 23% 18% Net assets, end of period (in thousands) $8,203 $8,753 $ 8,428 Ratios with no waiver of fees and assumption of expenses by the Adviser and no reduction for fees paid indirectly: Net expenses 2.94%** 3.25% 2.72% Net investment income 0.90%** 1.41% 0.89% Ratios with waiver of fees and assumption of expenses by the Adviser and reduction for fees paid indirectly: Net expenses 2.94%** 3.25% 2.71% Net investment income 0.90%** 1.41% 0.90% ========================================================================================================= Year Ended Year Ended Year Ended 12/31/07 12/31/06 12/31/05 Class B Net asset value, beginning of year $ 32.74 $ 25.64 $ 24.32 -------------------------------------------------------------------------------------------------------- Increase (decrease) from investment operations: Net investment income $ 0.06 $ 0.01 $ 0.06 Net realized and unrealized gain (loss) on investments (6.68) 8.78 3.24 -------------------------------------------------------------------------------------------------------- Net increase (decrease) from investment operations $ (6.61) $ 8.79 $ 3.30 Distributions to shareowners: Net investment income (0.07) (0.01) (0.05) Net realized gain (4.37) (1.68) (1.84) Tax return of capital -- -- (0.09) -------------------------------------------------------------------------------------------------------- Net increase (decrease) in net asset value $(11.06) $ 7.10 $ 1.32 -------------------------------------------------------------------------------------------------------- Net asset value, end of period $ 21.68 $ 32.74 $ 25.64 ======================================================================================================== Total return* (20.14)% 34.51% 13.72% Ratio of net expenses to average net assets+ 2.28% 2.31% 2.42% Ratio of net investment income to average net assets+ 0.11% 0.00%(a) 0.14% Portfolio turnover rate 21% 20% 24% Net assets, end of period (in thousands) $18,364 $35,442 $29,992 Ratios with no waiver of fees and assumption of expenses by the Adviser and no reduction for fees paid indirectly: Net expenses 2.28% 2.31% 2.42% Net investment income 0.11% 0.00%(a) 0.14% Ratios with waiver of fees and assumption of expenses by the Adviser and reduction for fees paid indirectly: Net expenses 2.26% 2.30% 2.42% Net investment income 0.13% 0.01% 0.14% ========================================================================================================
(a) Amount rounds to less than 0.01% per share. * Assumes initial investment at net asset value at the beginning of each period, reinvestment of all distributions, the complete redemption of the investment at net asset value at the end of each period, and no sales charges. Total return would be reduced if sales charges were taken into account. ** Annualized. + Ratio with no reduction for fees paid indirectly. The accompanying notes are an integral part of these financial statements. 26 Pioneer Real Estate Shares | Semiannual Report | 6/30/10
Six Months Ended 6/30/10 Year Ended (unaudited) 12/31/09 Class C Net asset value, beginning of year $ 16.06 $12.86 ------------------------------------------------------------------------------------------ Increase (decrease) from investment operations: Net investment income $ 0.12 $ 0.22 Net realized and unrealized gain (loss) on investments 0.95 3.34 ------------------------------------------------------------------------------------------ Net increase (decrease) from investment operations $ 1.07 $ 3.56 Distributions to shareowners: Net investment income (0.12) (0.22) Net realized gain -- -- Tax return of capital -- (0.14) ------------------------------------------------------------------------------------------ Net increase (decrease) in net asset value $ 0.95 $ 3.20 ------------------------------------------------------------------------------------------ Net asset value, end of period $ 17.01 $16.06 ========================================================================================== Total return* 6.64% 28.87% Ratio of net expenses to average net assets+ 2.50%** 2.89% Ratio of net investment income to average net assets+ 1.37%** 1.76% Portfolio turnover rate 10%** 23% Net assets, end of period (in thousands) $10,098 $9,153 Ratios with no waiver of fees and assumption of expenses by the Adviser and no reduction for fees paid indirectly: Net expenses 2.50%** 2.89% Net investment income 1.37%** 1.76% Ratios with waiver of fees and assumption of expenses by the Adviser and reduction for fees paid indirectly: Net expenses 2.50%** 2.89% Net investment income 1.37%** 1.76% ========================================================================================== Year Ended Year Ended Year Ended Year Ended 12/31/08 12/31/07 12/31/06 12/31/05 Class C Net asset value, beginning of year $ 21.72 $ 32.80 $ 25.68 $ 24.35 --------------------------------------------------------------------------------------------------------------------- Increase (decrease) from investment operations: Net investment income $ 0.25 $ 0.10 $ 0.02 $ 0.08 Net realized and unrealized gain (loss) on investments (8.53) (6.70) 8.80 3.26 --------------------------------------------------------------------------------------------------------------------- Net increase (decrease) from investment operations $ (8.28) $ (6.60) $ 8.82 $ 3.34 Distributions to shareowners: Net investment income (0.29) (0.11) (0.02) (0.07) Net realized gain -- (4.37) (1.68) (1.84) Tax return of capital (0.29) -- -- (0.10) --------------------------------------------------------------------------------------------------------------------- Net increase (decrease) in net asset value $ (8.86) $(11.08) $ 7.12 $ 1.33 --------------------------------------------------------------------------------------------------------------------- Net asset value, end of period $ 12.86 $ 21.72 $ 32.80 $ 25.68 ===================================================================================================================== Total return* (38.85)% (20.07)% 34.60% 13.85% Ratio of net expenses to average net assets+ 2.50% 2.17% 2.24% 2.32% Ratio of net investment income to average net assets+ 1.18% 0.26% 0.10% 0.27% Portfolio turnover rate 18% 21% 20% 24% Net assets, end of period (in thousands) $ 7,619 $15,139 $27,209 $19,824 Ratios with no waiver of fees and assumption of expenses by the Adviser and no reduction for fees paid indirectly: Net expenses 2.50% 2.17% 2.24% 2.32% Net investment income 1.18% 0.26% 0.10% 0.27% Ratios with waiver of fees and assumption of expenses by the Adviser and reduction for fees paid indirectly: Net expenses 2.49% 2.16% 2.23% 2.32% Net investment income 1.19% 0.27% 0.11% 0.27% =====================================================================================================================
* Assumes initial investment at net asset value at the beginning of each period, reinvestment of all distributions, the complete redemption of the investment at net asset value at the end of each period, and no sales charges. Total return would be reduced if sales charges were taken into account. ** Annualized. + Ratio with no reduction for fees paid indirectly. The accompanying notes are an integral part of these financial statements. Pioneer Real Estate Shares | Semiannual Report | 6/30/10 27 Financial Highlights (continued)
Six Months Ended 6/30/10 Year Ended (unaudited) 12/31/09 Class Y Net asset value, beginning of year $ 16.23 $ 12.98 ------------------------------------------------------------------------------------------ Increase (decrease) from investment operations: Net investment income $ 0.25 $ 0.44 Net realized and unrealized gain (loss) on investments 0.96 3.40 ------------------------------------------------------------------------------------------ Net increase (decrease) from investment operations $ 1.21 $ 3.84 Distributions to shareowners: Net investment income (0.24) (0.45) Net realized gain -- -- Tax return of capital -- (0.14) ------------------------------------------------------------------------------------------ Net increase (decrease) in net asset value $ 0.97 $ 3.25 ------------------------------------------------------------------------------------------ Net asset value, end of period $ 17.20 $ 16.23 ========================================================================================== Total return* 7.41% 31.38% Ratio of net expenses to average net assets+ 1.00%** 1.06% Ratio of net investment income to average net assets+ 2.84%** 3.49% Portfolio turnover rate 10%** 23% Net assets, end of period (in thousands) $41,469 $42,533 Ratios with no waiver of fees and assumption of expenses by the Adviser and no reduction for fees paid indirectly: Net expenses 1.00%** 1.06% Net investment income 2.84%** 3.49% Ratios with waiver of fees and assumption of expenses by the Adviser and reduction for fees paid indirectly: Net expenses 1.00%** 1.06% Net investment income 2.84%** 3.49% ========================================================================================== Year Ended Year Ended Year Ended Year Ended 12/31/08 12/31/07 12/31/06 12/31/05 Class Y Net asset value, beginning of year $ 21.90 $ 33.03 $ 25.84 $ 24.49 --------------------------------------------------------------------------------------------------------------------- Increase (decrease) from investment operations: Net investment income $ 0.54 $ 0.49 $ 0.42 $ 0.35 Net realized and unrealized gain (loss) on investments (8.59) (6.75) 8.87 3.34 --------------------------------------------------------------------------------------------------------------------- Net increase (decrease) from investment operations $ (8.05) $ (6.26) $ 9.29 $ 3.69 Distributions to shareowners: Net investment income (0.58) (0.50) (0.42) (0.34) Net realized gain -- (4.37) (1.68) (1.84) Tax return of capital (0.29) -- -- (0.16) --------------------------------------------------------------------------------------------------------------------- Net increase (decrease) in net asset value $ (8.92) $(11.13) $ 7.19 $ 1.35 --------------------------------------------------------------------------------------------------------------------- Net asset value, end of period $ 12.98 $ 21.90 $ 33.03 $ 25.84 ===================================================================================================================== Total return* (37.90)% (19.03)% 36.43% 15.36% Ratio of net expenses to average net assets+ 1.02% 0.90% 0.87% 1.00% Ratio of net investment income to average net assets+ 2.76% 1.81% 1.54% 1.84% Portfolio turnover rate 18% 21% 20% 24% Net assets, end of period (in thousands) $26,233 $44,729 $46,436 $26,490 Ratios with no waiver of fees and assumption of expenses by the Adviser and no reduction for fees paid indirectly: Net expenses 1.02% 0.90% 0.87% 1.00% Net investment income 2.76% 1.81% 1.54% 1.84% Ratios with waiver of fees and assumption of expenses by the Adviser and reduction for fees paid indirectly: Net expenses 1.02% 0.90% 0.87% 1.00% Net investment income 2.76% 1.81% 1.54% 1.84% =====================================================================================================================
* Assumes initial investment at net asset value at the beginning of each period, reinvestment of all distributions, and the complete redemption of the investment at net asset value at the end of each period. ** Annualized. + Ratio with no reduction for fees paid indirectly. The accompanying notes are an integral part of these financial statements. 28 Pioneer Real Estate Shares | Semiannual Report | 6/30/10 Notes to Financial Statements | 6/30/10 (unaudited) 1. Organization and Significant Accounting Policies Pioneer Real Estate Shares (the Fund) is a Delaware statutory trust registered under the Investment Company Act of 1940 as a diversified, open-end management investment company. The investment objective of the Fund is to seek long-term growth of capital. Current income is a secondary objective. The Fund offers three classes of shares designated as Class A, Class C and Class Y shares. Effective as of the close of business on December 31, 2009, Class B shares are no longer offered to new or existing shareholders, except that dividends and/or capital gain distributions may continue to be reinvested in Class B shares, and shareholders may exchange their Class B shares for Class B shares of other Pioneer funds, as permitted by existing exchange privileges. Each class of shares represents an interest in the same portfolio of investments of the Fund and has identical rights (based on relative net asset values) to assets and liquidation proceeds. Share classes can bear different rates of class-specific fees and expenses such as transfer agent and distribution fees. Differences in class-specific fees and expenses will result in differences in net investment income and, therefore, the payment of different dividends from net investment income earned by each class. The Amended and Restated Declaration of Trust of the Fund gives the Board the flexibility to specify either per-share voting or dollar-weighted voting when submitting matters for shareholder approval. Under per-share voting, each share of a class of the Fund is entitled to one vote. Under dollar-weighted voting, a shareholder's voting power is determined not by the number of shares owned, but by the dollar value of the shares on the record date. Each share class exclusive voting rights with respect to matters affecting only that class, including with respect to the distribution plan for that class. There is no distribution plan for Class Y shares. Class B shares convert to Class A shares approximately eight years after the date of purchase. Because the Fund may invest a substantial portion of its assets in Real Estate Investment Trusts (REITs), the Fund may be subject to certain risks associated with direct investments in REITs. REITs may be affected by changes in the value of their underlying properties and by defaults of their borrowers or tenants. REITs depend generally on their ability to generate cash flow to make distributions to shareowners, and certain REITs have self-liquidation provisions by which mortgages held may be paid in full and distributions of capital returns may be made at any time. In addition, the performance of a REIT may be affected by its failure to qualify for tax-free pass through of income under the Internal Revenue Code or its failure to maintain exemption from registration under the Investment Company Act of 1940. The Fund's prospectus Pioneer Real Estate Shares | Semiannual Report | 6/30/10 29 contains unaudited information regarding the Fund's principal risks. Please refer to that document when considering the Fund's principal risks. The Fund's financial statements have been prepared in conformity with U.S. generally accepted accounting principles that require the management of the Fund to, among other things, make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of income, expenses and gains and losses on investments during the reporting period. Actual results could differ from those estimates. The following is a summary of significant accounting policies followed by the Fund in the preparation of its financial statements, which are consistent with those policies generally accepted in the investment company industry. A. Security Valuation Security transactions are recorded as of trade date. The net asset value of the Fund is computed once daily, on each day the New York Stock Exchange (NYSE) is open, as of the close of regular trading on the NYSE. In computing the net asset value, securities that have traded on an exchange are fair valued at the last sale price on the principal exchange where they are traded. Securities that have not traded on the date of valuation, or securities for which sale prices are not available, generally are fair valued at the mean between the last bid and asked prices. Securities for which market prices and/or quotations are not readily available or are considered to be unreliable are valued using fair value methods pursuant to procedures adopted by the Board of Trustees. Trading in foreign securities is substantially completed each day at various times prior to the close of the NYSE. The values of such securities used in computing the net asset value of the Fund's shares are determined as of such times. The Fund may use fair value methods if it is determined that a significant event has occurred after the close of the exchange or market on which the security trades and prior to the determination of the Fund's net asset value. Thus, the valuation of the Fund's securities may differ from exchange prices. At June 30, 2010, there were no securities that were valued using fair value methods (other than securities that were valued using prices supplied by independent pricing services). Inputs used in the valuation of a security using fair value methods include credit ratings, the financial condition of the company, current market conditions and comparable securities. Short-term fixed income securities with remaining maturities of sixty days or less generally are valued at amortized cost. Money market mutual funds are valued at net asset value. 30 Pioneer Real Estate Shares | Semiannual Report | 6/30/10 Dividend income is recorded on the ex-dividend date except that certain dividends from foreign securities where the ex-dividend date may have passed are recorded as soon as the Fund becomes aware of the ex-dividend data in the exercise of reasonable diligence. Interest income, including interest on income bearing cash accounts, is recorded on the accrual basis. Dividend and interest income are reported net of unrecoverable foreign taxes withheld at the applicable country rates. Gains and losses on sales of investments are calculated on the identified cost method for both financial reporting and federal income tax purposes. B. Federal Income Taxes It is the Fund's policy to comply with the requirements of the Internal Revenue Code applicable to regulated investment companies and to distribute all of its taxable income and net realized capital gains, if any, to its shareowners. Therefore, no federal income tax provision is required. Tax years for the prior three fiscal years remain subject to examination by tax authorities. The amounts and characterizations of distributions to shareowners for financial reporting purposes are determined in accordance with federal income tax rules. Therefore, the sources of the Fund's distributions may be shown in the accompanying financial statements as from or in excess of net investment income or net realized gain on investment transactions, or as from paid-in capital, depending on the type of book/tax differences that may exist. A portion of the dividend income recorded by the Fund is from distributions by publicly traded REITs, and such distributions for tax purposes may also consist of capital gains and return of capital. The actual return of capital and capital gains portions of such distributions will be determined by formal notifications from the REITs subsequent to the calendar year-end. Distributions received from the REITs that are determined to be a return of capital are recorded by the Fund as a reduction of the cost basis of the securities held and those determined to be capital gain are reflected as such on the Statement of Operations. The tax character of current year distributions will be determined at the end of the Fund's taxable year. The tax character of distributions paid during the year ended December 31, 2009 was as follows:
-------------------------------------------------------------------------------- 2009 -------------------------------------------------------------------------------- Distributions paid from: Ordinary income $2,739,314 Return of capital 1,105,994 -------------------------------------------------------------------------------- Total $3,845,308 ================================================================================
Pioneer Real Estate Shares | Semiannual Report | 6/30/10 31 The following shows the components of distributable earnings on a federal income tax basis at December 31, 2009:
-------------------------------------------------------------------------------- 2009 -------------------------------------------------------------------------------- Distributable earnings: Capital loss carryforward $(27,375,691) Post-October loss deferred (1,435,822) Unrealized appreciation 25,014,734 -------------------------------------------------------------------------------- Total $ (3,796,779) ================================================================================
The difference between book-basis and tax-basis unrealized appreciation is attributable to the tax deferral of losses on wash sales. C. Fund Shares The Fund records sales and repurchases of its shares as of trade date. Pioneer Funds Distributor, Inc. (PFD), the principal underwriter for the Fund and a wholly owned indirect subsidiary of UniCredit S.p.A. (UniCredit), earned approximately $6,711 in underwriting commissions on the sale of Class A shares during the six months ended June 30, 2010. D. Class Allocations Income, common expenses and realized and unrealized gains and losses are calculated at the Fund level and allocated daily to each class of shares based on its respective percentage of adjusted net assets at the beginning of the day. Distribution fees are calculated based on the average daily net asset value attributable to Class A, Class B and Class C shares of the Fund, respectively (see Note 4). Class Y shares do not pay distribution fees. Shareowners of each class participate in all expenses and fees paid to the transfer agent, Pioneer Investment Management Shareholder Services, Inc. (PIMSS), for its services, which are allocated among the classes of shares based on the number of accounts in each class and the ratable allocation of related out-of-pocket expenses (see Note 3). Distributions to shareowners are recorded as of the ex-dividend date. Distributions paid by the Fund with respect to each class of shares are calculated in the same manner and at the same time, except that net investment income dividends to Class A, Class B, Class C and Class Y shares can reflect different transfer agent and distribution expense rates. E. Securities Lending The Fund lends securities in its portfolio to certain broker-dealers or other institutional investors. When entering into a securities loan transaction, the Fund typically receives cash collateral from the borrower equal to at least the 32 Pioneer Real Estate Shares | Semiannual Report | 6/30/10 fair value of the securities loaned, which is invested in temporary investments. Credit Suisse AG, New York Branch, as the Fund's securities lending agent, manages the Fund's securities lending collateral. The income earned on the investment of collateral is shared with the borrower and the lending agent in payment of any rebate due to the borrower with respect to the securities loan, and in compensation for the lending agent's services to the Fund. The Fund also continues to receive payments in lieu of dividends or interest on the securities loaned. Gain or loss on the fair value of the loaned securities that may occur during the term of the loan will be for the account of the Fund. The amount of the collateral is required to be adjusted daily to reflect any price fluctuation in the fair value of the loaned securities. If the required market value of the collateral is less than the fair value of the loaned securities, the borrower is required to deliver additional collateral for the account of the Fund prior to the close of the next business day. The Fund has the right, under the lending agreement, to terminate the loan and recover the securities from the borrower with prior notice. The Fund is required to return the cash collateral to the borrower and could suffer a loss if the value of the collateral, as invested, has declined. F. Repurchase Agreements With respect to repurchase agreements entered into by the Fund, the value of the underlying securities (collateral), including accrued interest, is required to be equal to or in excess of the repurchase price. The collateral for all repurchase agreements is held in safekeeping in the customer-only account of the Fund's custodian or a subcustodian of the Fund. The Fund's investment adviser, Pioneer Investment Management, Inc. (PIM), is responsible for determining that the value of the collateral remains at least equal to the repurchase price. 2. Management Agreement PIM, a wholly owned indirect subsidiary of UniCredit, manages the Fund's portfolio. Management fees are calculated daily at the annual rate of 0.80% of the Fund's average daily net assets up to $1 billion; and 0.75% of the Fund's average daily net assets over $1 billion. Prior to January 1, 2010, management fees were calculated daily at the annual rate of 0.80% of the Fund's average daily net assets. PIM pays a portion of the fee it receives from the Fund to AEW Capital Management, L.P. as compensation for sub-advisory services to the Fund. In addition, under the management and administration agreements, certain other services and costs, including accounting, regulatory reporting and insurance premiums, are paid by the Fund as administrative reimbursements. Included in "Due to affiliates" reflected on the statement of Assets and Liabilities is $2,956 in management fees, administrative costs and certain other reimbursements payable to PIM at June 30, 2010. Pioneer Real Estate Shares | Semiannual Report | 6/30/10 33 3. Transfer Agent PIMSS, a wholly owned indirect subsidiary of UniCredit, provides substantially all transfer agent and shareowner services to the Fund at negotiated rates. In addition, the Fund reimburses PIMSS for out-of-pocket expenses incurred by PIMSS related to shareholder communications activities such as proxy and statement mailings, outgoing phone calls and omnibus relationship contracts. For the six months ended June 30, 2010, such out-of-pocket expenses by class of shares were as follows:
-------------------------------------------------------------------------------- Shareholder Communications: -------------------------------------------------------------------------------- Class A $33,293 Class B 11,358 Class C 3,472 Class Y 114 -------------------------------------------------------------------------------- Total $48,237 ================================================================================
Included in "Due to affiliates" reflected on the Statement of Assets and Liabilities is $34,426 in transfer agent fees and out-of-pocket reimbursements payable to PIMSS at June 30, 2010. 4. Distribution Plan The Fund has adopted a Distribution Plan pursuant to Rule 12b-1 of the Investment Company Act of 1940 with respect to its Class A, Class B and Class C shares. Pursuant to the Plan, the Fund pays PFD 0.25% of the average daily net assets attributable to Class A shares as compensation for personal services and/or account maintenance services or distribution services with regard to Class A shares. Pursuant to the Plan, the Fund also pays PFD 1.00% of the average daily net assets attributable to Class B and Class C shares. The fee for Class B and Class C shares consists of a 0.25% service fee and a 0.75% distribution fee paid as compensation for personal services and/or account maintenance services or distribution services with regard to Class B and Class C shares. Included in "Due to affiliates" reflected on the Statement of Assets and Liabilities is $987 in distribution fees payable to PFD at June 30, 2010. In addition, redemptions of each class of shares (except Class Y shares) may be subject to a contingent deferred sales charge (CDSC). A CDSC of 1.00% may be imposed on redemptions of certain net asset value purchases of Class A shares within 18 months of purchase (within 12 months for purchases made on or after April 1, 2009). Class B shares that are redeemed within five years of purchase are subject to a CDSC at declining rates beginning at 4.00%, based on the lower of cost or market value of shares being redeemed. Redemptions of Class C shares within one year of purchase are subject to a CDSC of 1.00%, based on the lower of cost or market value of shares being redeemed. Shares purchased as part of an exchange remain subject to any CDSC that applied to 34 Pioneer Real Estate Shares | Semiannual Report | 6/30/10 the original purchase of those shares. There is no CDSC for Class Y shares. Proceeds from the CDSCs are paid to PFD. For the six months ended June 30, 2010, CDSCs in the amount of $5,788 were paid to PFD. 5. Expense Offset Arrangements The Fund has entered into certain expense offset arrangements with PIMSS resulting in a reduction in the Fund's total expenses due to interest earned on cash held by PIMSS. For the six months ended June 30, 2010, the Fund's expenses were not reduced under such arrangements. 6. Line of Credit Facility The Fund, along with certain other funds in the Pioneer Family of Funds (the Funds), participates in a $165 million committed, unsecured revolving line of credit facility. Borrowings are used solely for temporary or emergency purposes. The Fund may borrow up to the lesser of the amount available under the facility or the limits set for borrowing by the Fund's prospectus and the 1940 Act. Interest on borrowings is payable at the higher of the London Interbank Offered Rate (LIBOR) on the borrowing date plus 1.25% on an annualized basis or the Federal Funds Rate on the borrowing date plus 1.25% on an annualized basis. The Funds pay an annual commitment fee for this facility. The commitment fee is allocated among participating Funds based on an allocation schedule set forth in the credit agreement. For the six months ended June 30, 2010, the Fund had no borrowings under this agreement. 7. Subsequent Events In preparing these financial statements, PIM has evaluated the impact of all events and transactions for potential recognition or disclosure and has determined that there were no subsequent events requiring recognition or disclosure in the financial statements. Pioneer Real Estate Shares | Semiannual Report | 6/30/10 35 Trustees, Officers and Service Providers Trustees John F. Cogan, Jr., Chairman David R. Bock Mary K. Bush Benjamin M. Friedman Margaret B.W. Graham Daniel K. Kingsbury Thomas J. Perna Marguerite A. Piret Stephen K. West Officers John F. Cogan, Jr., President Daniel K. Kingsbury, Executive Vice President Mark E. Bradley, Treasurer Christopher J. Kelley, Secretary Investment Adviser and Administrator Pioneer Investment Management, Inc. Custodian Brown Brothers Harriman & Co. Principal Underwriter Pioneer Funds Distributor, Inc. Legal Counsel Bingham McCutchen LLP Shareowner Services and Transfer Agent Pioneer Investment Management Shareholder Services, Inc. Proxy Voting Policies and Procedures of the Fund are available without charge, upon request, by calling our toll free number (1-800-225-6292). Information regarding how the Fund voted proxies relating to portfolio securities during the most recent 12-month period ended June 30 is publicly available to shareowners at pioneerinvestments.com. This information is also available on the Securities and Exchange Commission's web site at http://www.sec.gov. 36 Pioneer Real Estate Shares | Semiannual Report | 6/30/10 How To Contact Pioneer We are pleased to offer a variety of convenient ways for you to contact us for assistance or information. Call us for: -------------------------------------------------------------------------------- Account Information, including existing accounts, new accounts, prospectuses, applications and service forms 1-800-225-6292 FactFone(SM) for automated fund yields, prices, account information and transactions 1-800-225-4321 Retirement plans information 1-800-622-0176 Write to us: -------------------------------------------------------------------------------- PIMSS, Inc. P.O. Box 55014 Boston, Massachusetts 02205-5014 Our toll-free fax 1-800-225-4240 Our internet e-mail address ask.pioneer@pioneerinvestments.com (for general questions about Pioneer only) Visit our web site: pioneerinvestments.com This report must be preceded or accompanied by a prospectus. The Fund files a complete schedule of investments with the Securities and Exchange Commission for the first and third quarters for each fiscal year on Form N-Q. Shareholders may view the filed Form N-Q by visiting the Commission's web site at http://www.sec.gov. The filed form may also be viewed and copied at the Commission's Public Reference Room in Washington, DC. Information regarding the operations of the Public Reference Room may be obtained by calling 1-800-SEC-0330. ITEM 2. CODE OF ETHICS. (a) Disclose whether, as of the end of the period covered by the report, the registrant has adopted a code of ethics that applies to the registrant's principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions, regardless of whether these individuals are employed by the registrant or a third party. If the registrant has not adopted such a code of ethics, explain why it has not done so. The registrant has adopted, as of the end of the period covered by this report, a code of ethics that applies to the registrant's principal executive officer, principal financial officer, principal accounting officer and controller. (b) For purposes of this Item, the term "code of ethics" means written standards that are reasonably designed to deter wrongdoing and to promote: (1) Honest and ethical conduct, including the ethical handling of actual or apparent conflicts of interest between personal and professional relationships; (2) Full, fair, accurate, timely, and understandable disclosure in reports and documents that a registrant files with, or submits to, the Commission and in other public communications made by the registrant; (3) Compliance with applicable governmental laws, rules, and regulations; (4) The prompt internal reporting of violations of the code to an appropriate person or persons identified in the code; and (5) Accountability for adherence to the code. (c) The registrant must briefly describe the nature of any amendment, during the period covered by the report, to a provision of its code of ethics that applies to the registrant's principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions, regardless of whether these individuals are employed by the registrant or a third party, and that relates to any element of the code of ethics definition enumerated in paragraph (b) of this Item. The registrant must file a copy of any such amendment as an exhibit pursuant to Item 10(a), unless the registrant has elected to satisfy paragraph (f) of this Item by posting its code of ethics on its website pursuant to paragraph (f)(2) of this Item, or by undertaking to provide its code of ethics to any person without charge, upon request, pursuant to paragraph (f)(3) of this Item. The registrant has made no amendments to the code of ethics during the period covered by this report. (d) If the registrant has, during the period covered by the report, granted a waiver, including an implicit waiver, from a provision of the code of ethics to the registrant's principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions, regardless of whether these individuals are employed by the registrant or a third party, that relates to one or more of the items set forth in paragraph (b) of this Item, the registrant must briefly describe the nature of the waiver, the name of the person to whom the waiver was granted, and the date of the waiver. Not applicable. (e) If the registrant intends to satisfy the disclosure requirement under paragraph (c) or (d) of this Item regarding an amendment to, or a waiver from, a provision of its code of ethics that applies to the registrant's principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions and that relates to any element of the code of ethics definition enumerated in paragraph (b) of this Item by posting such information on its Internet website, disclose the registrant's Internet address and such intention. Not applicable. (f) The registrant must: (1) File with the Commission, pursuant to Item 10(a), a copy of its code of ethics that applies to the registrant's principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions, as an exhibit to its annual report on this Form N-CSR; (2) Post the text of such code of ethics on its Internet website and disclose, in its most recent report on this Form N-CSR, its Internet address and the fact that it has posted such code of ethics on its Internet website; or (3) Undertake in its most recent report on this Form N-CSR to provide to any person without charge, upon request, a copy of such code of ethics and explain the manner in which such request may be made. See Item 10(2) ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT. (a) (1) Disclose that the registrant's board of trustees has determined that the registrant either: (i) Has at least one audit committee financial expert serving on its audit committee; or (ii) Does not have an audit committee financial expert serving on its audit committee. The registrant's Board of Trustees has determined that the registrant has at least one audit committee financial expert. (2) If the registrant provides the disclosure required by paragraph (a)(1)(i) of this Item, it must disclose the name of the audit committee financial expert and whether that person is "independent." In order to be considered "independent" for purposes of this Item, a member of an audit committee may not, other than in his or her capacity as a member of the audit committee, the board of trustees, or any other board committee: (i) Accept directly or indirectly any consulting, advisory, or other compensatory fee from the issuer; or (ii) Be an "interested person" of the investment company as defined in Section 2(a)(19) of the Act (15 U.S.C. 80a-2(a)(19)). Ms. Marguerite A. Piret, an independent trustee, is such an audit committee financial expert. (3) If the registrant provides the disclosure required by paragraph (a)(1) (ii) of this Item, it must explain why it does not have an audit committee financial expert. Not applicable. ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES. (a) Disclose, under the caption AUDIT FEES, the aggregate fees billed for each of the last two fiscal years for professional services rendered by the principal accountant for the audit of the registrant's annual financial statements or services that are normally provided by the accountant in connection with statutory and regulatory filings or engagements for those fiscal years. N/A (b) Disclose, under the caption AUDIT-RELATED FEES, the aggregate fees billed in each of the last two fiscal years for assurance and related services by the principal accountant that are reasonably related to the performance of the audit of the registrant's financial statements and are not reported under paragraph (a) of this Item. Registrants shall describe the nature of the services comprising the fees disclosed under this category. N/A (c) Disclose, under the caption TAX FEES, the aggregate fees billed in each of the last two fiscal years for professional services rendered by the principal accountant for tax compliance, tax advice, and tax planning. Registrants shall describe the nature of the services comprising the fees disclosed under this category. N/A (d) Disclose, under the caption ALL OTHER FEES, the aggregate fees billed in each of the last two fiscal years for products and services provided by the principal accountant, other than the services reported in paragraphs (a) through (c) of this Item. Registrants shall describe the nature of the services comprising the fees disclosed under this category. N/A (e) (1) Disclose the audit committee's pre-approval policies and procedures described in paragraph (c)(7) of Rule 2-01 of Regulation S-X. PIONEER FUNDS APPROVAL OF AUDIT, AUDIT-RELATED, TAX AND OTHER SERVICES PROVIDED BY THE INDEPENDENT AUDITOR SECTION I - POLICY PURPOSE AND APPLICABILITY The Pioneer Funds recognize the importance of maintaining the independence of their outside auditors. Maintaining independence is a shared responsibility involving Pioneer Investment Management, Inc ("PIM"), the audit committee and the independent auditors. The Funds recognize that a Fund's independent auditors: 1) possess knowledge of the Funds, 2) are able to incorporate certain services into the scope of the audit, thereby avoiding redundant work, cost and disruption of Fund personnel and processes, and 3) have expertise that has value to the Funds. As a result, there are situations where it is desirable to use the Fund's independent auditors for services in addition to the annual audit and where the potential for conflicts of interests are minimal. Consequently, this policy, which is intended to comply with Rule 210.2-01(C)(7), sets forth guidelines and procedures to be followed by the Funds when retaining the independent audit firm to perform audit, audit-related tax and other services under those circumstances, while also maintaining independence. Approval of a service in accordance with this policy for a Fund shall also constitute approval for any other Fund whose pre-approval is required pursuant to Rule 210.2-01(c)(7)(ii). In addition to the procedures set forth in this policy, any non-audit services that may be provided consistently with Rule 210.2-01 may be approved by the Audit Committee itself and any pre-approval that may be waived in accordance with Rule 210.2-01(c)(7)(i)(C) is hereby waived. Selection of a Fund's independent auditors and their compensation shall be determined by the Audit Committee and shall not be subject to this policy.
SECTION II - POLICY ---------------- -------------------------------- ------------------------------------------------- SERVICE SERVICE CATEGORY DESCRIPTION SPECIFIC PRE-APPROVED SERVICE SUBCATEGORIES CATEGORY ---------------- -------------------------------- ------------------------------------------------- I. AUDIT Services that are directly o Accounting research assistance SERVICES related to performing the o SEC consultation, registration independent audit of the Funds statements, and reporting o Tax accrual related matters o Implementation of new accounting standards o Compliance letters (e.g. rating agency letters) o Regulatory reviews and assistance regarding financial matters o Semi-annual reviews (if requested) o Comfort letters for closed end offerings ---------------- -------------------------------- ------------------------------------------------- II. Services which are not o AICPA attest and agreed-upon procedures AUDIT-RELATED prohibited under Rule o Technology control assessments SERVICES 210.2-01(C)(4) (the "Rule") o Financial reporting control assessments and are related extensions of o Enterprise security architecture the audit services support the assessment audit, or use the knowledge/expertise gained from the audit procedures as a foundation to complete the project. In most cases, if the Audit-Related Services are not performed by the Audit firm, the scope of the Audit Services would likely increase. The Services are typically well-defined and governed by accounting professional standards (AICPA, SEC, etc.) ---------------- -------------------------------- ------------------------------------------------- ------------------------------------- ------------------------------------ AUDIT COMMITTEE APPROVAL POLICY AUDIT COMMITTEE REPORTING POLICY ------------------------------------- ------------------------------------ o "One-time" pre-approval o A summary of all such for the audit period for all services and related fees pre-approved specific service reported at each regularly subcategories. Approval of the scheduled Audit Committee independent auditors as meeting. auditors for a Fund shall constitute pre approval for these services. ------------------------------------- ------------------------------------ o "One-time" pre-approval o A summary of all such for the fund fiscal year within services and related fees a specified dollar limit (including comparison to for all pre-approved specified dollar limits) specific service subcategories reported quarterly. o Specific approval is needed to exceed the pre-approved dollar limit for these services (see general Audit Committee approval policy below for details on obtaining specific approvals) o Specific approval is needed to use the Fund's auditors for Audit-Related Services not denoted as "pre-approved", or to add a specific service subcategory as "pre-approved" ------------------------------------- ------------------------------------
SECTION III - POLICY DETAIL, CONTINUED ----------------------- --------------------------- ----------------------------------------------- SERVICE CATEGORY SERVICE CATEGORY SPECIFIC PRE-APPROVED SERVICE SUBCATEGORIES DESCRIPTION ----------------------- --------------------------- ----------------------------------------------- III. TAX SERVICES Services which are not o Tax planning and support prohibited by the Rule, o Tax controversy assistance if an officer of the Fund o Tax compliance, tax returns, excise determines that using the tax returns and support Fund's auditor to provide o Tax opinions these services creates significant synergy in the form of efficiency, minimized disruption, or the ability to maintain a desired level of confidentiality. ----------------------- --------------------------- ----------------------------------------------- ------------------------------------- ------------------------- AUDIT COMMITTEE APPROVAL POLICY AUDIT COMMITTEE REPORTING POLICY ------------------------------------- ------------------------- ------------------------------------- ------------------------- o "One-time" pre-approval o A summary of for the fund fiscal year all such services and within a specified dollar limit related fees (including comparison to specified dollar limits) reported quarterly. o Specific approval is needed to exceed the pre-approved dollar limits for these services (see general Audit Committee approval policy below for details on obtaining specific approvals) o Specific approval is needed to use the Fund's auditors for tax services not denoted as pre-approved, or to add a specific service subcategory as "pre-approved" ------------------------------------- -------------------------
SECTION III - POLICY DETAIL, CONTINUED ----------------------- --------------------------- ----------------------------------------------- SERVICE CATEGORY SERVICE CATEGORY SPECIFIC PRE-APPROVED SERVICE SUBCATEGORIES DESCRIPTION ----------------------- --------------------------- ----------------------------------------------- IV. OTHER SERVICES Services which are not o Business Risk Management support prohibited by the Rule, o Other control and regulatory A. SYNERGISTIC, if an officer of the Fund compliance projects UNIQUE QUALIFICATIONS determines that using the Fund's auditor to provide these services creates significant synergy in the form of efficiency, minimized disruption, the ability to maintain a desired level of confidentiality, or where the Fund's auditors posses unique or superior qualifications to provide these services, resulting in superior value and results for the Fund. ----------------------- --------------------------- ----------------------------------------------- --------------------------------------- ------------------------ AUDIT COMMITTEE APPROVAL POLICY AUDIT COMMITTEE REPORTING POLICY ------------------------------------- -------------------------- o "One-time" pre-approval o A summary of for the fund fiscal year within all such services and a specified dollar limit related fees (including comparison to specified dollar limits) reported quarterly. o Specific approval is needed to exceed the pre-approved dollar limits for these services (see general Audit Committee approval policy below for details on obtaining specific approvals) o Specific approval is needed to use the Fund's auditors for "Synergistic" or "Unique Qualifications" Other Services not denoted as pre-approved to the left, or to add a specific service subcategory as "pre-approved" ------------------------------------- --------------------------
SECTION III - POLICY DETAIL, CONTINUED ----------------------- ------------------------- ----------------------------------------------- SERVICE CATEGORY SERVICE CATEGORY SPECIFIC PROHIBITED SERVICE SUBCATEGORIES DESCRIPTION ----------------------- ------------------------- ----------------------------------------------- PROHIBITED SERVICES Services which result 1. Bookkeeping or other services in the auditors losing related to the accounting records or independence status financial statements of the audit under the Rule. client* 2. Financial information systems design and implementation* 3. Appraisal or valuation services, fairness* opinions, or contribution-in-kind reports 4. Actuarial services (i.e., setting actuarial reserves versus actuarial audit work)* 5. Internal audit outsourcing services* 6. Management functions or human resources 7. Broker or dealer, investment advisor, or investment banking services 8. Legal services and expert services unrelated to the audit 9. Any other service that the Public Company Accounting Oversight Board determines, by regulation, is impermissible ----------------------- ------------------------- ----------------------------------------------- ------------------------------------------- ------------------------------ AUDIT COMMITTEE APPROVAL POLICY AUDIT COMMITTEE REPORTING POLICY ------------------------------------------- ------------------------------ o These services are not to be o A summary of all performed with the exception of the(*) services and related services that may be permitted fees reported at each if they would not be subject to audit regularly scheduled procedures at the audit client (as Audit Committee meeting defined in rule 2-01(f)(4)) level will serve as continual the firm providing the service. confirmation that has not provided any restricted services. ------------------------------------------- ------------------------------
-------------------------------------------------------------------------------- GENERAL AUDIT COMMITTEE APPROVAL POLICY: o For all projects, the officers of the Funds and the Fund's auditors will each make an assessment to determine that any proposed projects will not impair independence. o Potential services will be classified into the four non-restricted service categories and the "Approval of Audit, Audit-Related, Tax and Other Services" Policy above will be applied. Any services outside the specific pre-approved service subcategories set forth above must be specifically approved by the Audit Committee. o At least quarterly, the Audit Committee shall review a report summarizing the services by service category, including fees, provided by the Audit firm as set forth in the above policy. -------------------------------------------------------------------------------- (2) Disclose the percentage of services described in each of paragraphs (b) through (d) of this Item that were approved by the audit committee pursuant to paragraph (c)(7)(i)(C) of Rule 2-01 of Regulation S-X. N/A (f) If greater than 50 percent, disclose the percentage of hours expended on the principal accountant's engagement to audit the registrant's financial statements for the most recent fiscal year that were attributed to work performed by persons other than the principal accountant's full-time, permanent employees. N/A (g) Disclose the aggregate non-audit fees billed by the registrant's accountant for services rendered to the registrant, and rendered to the registrant's investment adviser (not including any sub-adviser whose role is primarily portfolio management and is subcontracted with or overseen by another investment adviser), and any entity controlling, controlled by, or under common control with the adviser that provides ongoing services to the registrant for each of the last two fiscal years of the registrant. N/A (h) Disclose whether the registrant's audit committee of the board of trustees has considered whether the provision of non-audit services that were rendered to the registrant's investment adviser (not including any subadviser whose role is primarily portfolio management and is subcontracted with or overseen by another investment adviser), and any entity controlling, controlled by, or under common control with the investment adviser that provides ongoing services to the registrant that were not pre-approved pursuant to paragraph (c)(7)(ii) of Rule 2-01 of Regulation S-X is compatible with maintaining the principal accountant's independence. The Fund's audit committee of the Board of Trustees has considered whether the provision of non-audit services that were rendered to the Affiliates (as defined) that were not pre- approved pursuant to paragraph (c)(7)(ii) of Rule 2-01 of Regulation S-X is compatible with maintaining the principal accountant's independence. Item 5. Audit Committee of Listed Registrants (a) If the registrant is a listed issuer as defined in Rule 10A-3 under the Exchange Act (17 CFR 240.10A-3), state whether or not the registrant has a separately-designated standing audit committee established in accordance with Section 3(a)(58)(A) of the Exchange Act (15 U.S.C. 78c(a)(58)(A)). If the registrant has such a committee, however designated, identify each committee member. If the entire board of directors is acting as the registrants audit committee as specified in Section 3(a)(58)(B) of the Exchange Act (15 U.S.C. 78c(a)(58)(B)), so state. N/A (b) If applicable, provide the disclosure required by Rule 10A-3(d) under the Exchange Act (17 CFR 240.10A-3(d)) regarding an exemption from the listing standards for audit committees. N/A Item 6. Schedule of Investments. File Schedule I Investments in securities of unaffiliated issuers as of the close of the reporting period as set forth in 210.12- 12 of Regulation S-X [17 CFR 210.12-12], unless the schedule is included as part of the report to shareholders filed under Item 1 of this Form. Included in Item 1 ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END MANAGEMENT INVESTMENT COMPANIES. A closed-end management investment company that is filing an annual report on this Form N-CSR must, unless it invests exclusively in non-voting securities, describe the policies and procedures that it uses to determine how to vote proxies relating to portfolio securities, including the procedures that the company uses when a vote presents a conflict between the interests of its shareholders, on the one hand, and those of the company's investment adviser; principal underwriter; or any affiliated person (as defined in Section 2(a)(3) of the Investment Company Act of 1940 (15 U.S.C. 80a-2(a)(3)) and the rules thereunder) of the company, its investment adviser, or its principal underwriter, on the other. Include any policies and procedures of the company's investment adviser, or any other third party, that the company uses, or that are used on the company's behalf, to determine how to vote proxies relating to portfolio securities. Not applicable to open-end management investment companies. Item 8. Portfolio Managers of Closed-End Management Investment Companies. (a) If the registrant is a closed-end management investment company that is filing an annual report on this Form N-CSR,provide the following information: (1) State the name, title, and length of service of the person or persons employed by or associated with the registrant or an investment adviser of the registrant who are primarily responsible for the day-to-day management of the registrants portfolio (Portfolio Manager). Also state each Portfolio Managers business experience during the past 5 years. Not applicable to open-end management investment companies. Item 9. Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers. (a) If the registrant is a closed-end management investment company, in the following tabular format, provide the information specified in paragraph (b) of this Item with respect to any purchase made by or on behalf of the registrant or any affiliated purchaser, as defined in Rule 10b-18(a)(3) under the Exchange Act (17 CFR 240.10b-18(a)(3)), of shares or other units of any class of the registrants equity securities that is registered by the registrant pursuant to Section 12 of the Exchange Act (15 U.S.C. 781). Instruction to paragraph (a). Disclose all purchases covered by this Item, including purchases that do not satisfy the conditions of the safe harbor of Rule 10b-18 under the Exchange Act (17 CFR 240.10b-18), made in the period covered by the report. Provide disclosures covering repurchases made on a monthly basis. For example, if the reporting period began on January 16 and ended on July 15, the chart would show repurchases for the months from January 16 through February 15, February 16 through March 15, March 16 through April 15, April 16 through May 15, May 16 through June 15, and June 16 through July 15. Not applicable to open-end management investment companies. Item 10. Submission of Matters to a Vote of Security Holders. Describe any material changes to the procedures by which shareholders may recommend nominees to the registrants board of directors, where those changes were implemented after the registrant last provided disclosure in response to the requirements of Item 7(d)(2)(ii)(G) of Schedule 14A (17 CFR 240.14a-101), or this Item. There have been no material changes to the procedures by which the shareholders may recommend nominees to the registrants board of directors since the registrant last provided disclosure in response to the requirements of Item 7(d)(2)(ii)(G) of Schedule 14(A) in its definitive proxy statement, or this Item. ITEM 11. CONTROLS AND PROCEDURES. (a) Disclose the conclusions of the registrant's principal executive officer or officers and principal financial officer or officers, or persons performing similar functions, about the effectiveness of the registrant's disclosure controls and procedures (as defined in Rule 30a-2(c) under the Act (17 CFR 270.30a-2(c))) based on their evaluation of these controls and procedures as of a date within 90 days of the filing date of the report that includes the disclosure required by this paragraph. The registrant's principal executive officer and principal financial officer have concluded that the registrant's disclosure controls and procedures are effective based on their evaluation of these controls and procedures as of a date within 90 days of the filing date of this report. (b) Disclose whether or not there were significant changes in the registrant's internal controls or in other factors that could significantly affect these controls subsequent to the date of their evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses. There were no significant changes in the registrant's internal control over financial reporting that occurred during the second fiscal quarter of the period covered by this report that have materially affected, or are reasonably likely to materially affect, the registrant's internal control over financial reporting. The registrant's principal executive officer and principal financial officer, however, voluntarily are reporting the following information: In August of 2006 the registrant's investment adviser enhanced its internal procedures for reporting performance information required to be included in prospectuses. Those enhancements involved additional internal controls over the appropriateness of performance data generated for this purpose. Such enhancements were made following an internal review which identified prospectuses relating to certain classes of shares of a limited number of registrants where, inadvertently, performance information not reflecting the deduction of applicable sales charges was included. Those prospectuses were revised, and the revised prospectuses were distributed to shareholders. ITEM 12. EXHIBITS. File the exhibits listed below as part of this Form. Letter or number the exhibits in the sequence indicated. (a) Any code of ethics, or amendment thereto, that is the subject of the disclosure required by Item 2, to the extent that the registrant intends to satisfy the Item 2 requirements through filing of an exhibit. (b) A separate certification for each principal executive officer and principal financial officer of the registrant as required by Rule 30a-2 under the Act (17 CFR 270.30a-2). Filed herewith. SIGNATURES [See General Instruction F] 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) Pioneer Real Estate Shares By (Signature and Title)* /s/ John F. Cogan, Jr. John F. Cogan, Jr, President Date August 27, 2010 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. By (Signature and Title)* /s/ John F. Cogan, Jr. John F. Cogan, Jr., President Date August 27, 2010 By (Signature and Title)* /s/ Mark Bradley Mark Bradley, Treasurer Date August 27, 2010 * Print the name and title of each signing officer under his or her signature.