COHEN & STEERS
REALTY MAJORS
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[logo] Defined Asset Funds (SM)
Buy with Knowledge o Hold with Confidence
The Realty Majors(SM) Portfolio March 31, 1999
The Realty Majors Portfolio
The Equity Investor Fund Cohen & Steers Realty Majors(SM) Portfolio is a
Defined Asset Fund(SM) with investments in many of the leading Real Estate
Investment Trusts ("REITs") in the U.S. The Portfolio is broadly diversified
by both geographic region and property type and is designed to provide a total
investment return from both current income and the potential for capital
appreciation.
Investment Overview
This Fund continued to enjoy strong relative performance in the first quarter
and since inception. Although past performance is no guarantee of future
results, the Fund's focus on the nation's leading real estate companies
enabled it to perform better than the general real estate benchmarks. REITs,
however, remained out of favor despite posting strong earnings and dividend
growth. Cohen & Steers believes that today REIT valuations are, by all
measures, at historically attractive levels. The average REIT dividend yield
at quarter end, for example, was 8.0%. At the same time the health of the
U.S. economy and most property markets remained strong. This suggests that
REITs offer investors value today and Cohen & Steers believes that the large,
well-capitalized companies that comprise the Realty Majors portfolio are
attractively positioned in this environment to execute strategies to enhance
shareholder value and continue to grow earnings and increase dividends.
Realty Majors in the News First Quarter 1999
o Archstone Communities executed a $100 million common share repurchase
program.
o Duke Realty Investments agreed to acquire Weeks Corporation, a NYSE- listed
industrial REIT, for $1.7 billion in stock and the assumption of debt.
o Equity Office Properties, in a first for the REIT industry, received a
ruling from the IRS which will allow it to collect revenue from tenants for
telecommunications and other services without violating REIT rules.
Separately, the company issues $1.0 billion in senior unsecured notes at an
average cost of 6.8%.
o Equity Residential Properties formed a five-year partnership with US West
to provide residents a "one-stop" telecommunications package.
o Health Care Property Investors acquired $49 million in nursing homes leased
to Beverly Enterprises and $108 million in medical office buildings located
primarily in Salt Lake City, UT.
o Highwoods Properties raised $126 million by contributing 1.2 million square
feet of office space to a joint venture it has formed with a German
investment fund.
o Kimco Realty received a $117 million equity commitment from an
institutional investor to fund the Kimco Income REIT ("KIT"), a newly
formed company designed to invest in shopping centers with high,
predictable current income. Kimco will retain a 40% interest in KIT.
o Mack Cali Realty issued $600 million in senior unsecured notes at an
average cost of 7.2%.
o Reckson Associates Realty, in conjunction with its pending acquisition of
Tower Realty Trust, agreed to sell $85 million in New York City office
properties from the NYSE-listed REIT. Separately, Reckson issued $300
million in senior unsecured notes at an average cost of 7.7%.
o Simon Property Group continued its consolidation strategy by contracting to
purchase the New England Development Company's $1.7 billion regional mall
portfolio. The 14 regional malls, which are located in Massachusetts and
surrounding states, will be owned by a joint venture between Simon and a
pension fund, and will give Simon a commanding presence in New England mall
retailing.
o Vornado Realty increased its ownership stake in Charles E. Smith Commercial
Realty LP from 10% to 34% in a transaction valued at $500 million. Smith is
a private company which owns interests in or manages 26 million square feet
of office properties in Washington D.C. and Northern Virginia. In
conjunction with the Smith transaction, Vornado issued $250 million in 6%
preferred stock convertible at $44 per share.
o Fourth quarter Funds From Operations (cash flow) growth averaged 16.6% for
the companies in the Realty Majors Portfolio.
Geographic Diversification as of 3/31/99
[Graphic representation of the U.S., divided into sections and labeled with
section names and percentages.]
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Section Name States Percentage
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North West Central North Dakota, South Dakota, 4%
Nebraska, Kansas, Oklahoma,
Minnesota, Iowa, Missouri, Arkansas,
Louisiana
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Pacific Washington, Oregon, California 20%
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Mountain Idaho, Nevada, Utah, Arizona, 9%
Montana, Wyoming, Colorado, New
Mexico
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South West Central Texas 11%
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North East Central Wisconsin, Michigan, Illinois, 14%
Indiana, Ohio
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New England Maine, New Hampshire, Vermont, 3%
Massachusetts, Connecticut, Rhode
Island
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Mid-Atlantic New York, Pennsylvania, New Jersey 16%
South Atlantic Delaware, Maryland, West Virginia, 21%
Virginia, North Carolina, South
Carolina, Georgia, Florida
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South East Central Kentucky, Tennessee, Mississippi, 2%
Alabama
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Portfolio Highlights as of 3/13/99
Symbol RMP001
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Number of Holdings 29
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Total Net Assets $609 million
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NAV per Unit $0.82904
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Termination Date April, 2001
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Investment Consultant Cohen & Steers Capital Management
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Investment Performance
Total Return from Inception 4/23/98 to 3/31/99(1)
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Realty Majors Portfolio -12.68%
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Dow Jones REIT Index(2) -15.66%
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S&P REIT Index -20.18%
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Dow Jones Industrial Average 8.84%
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S&P 500 Index 16.50%
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(1) Change in Total Returns (stock prices plus dividends reinvested divided
by initial price). The Portfolio reflects deduction of ongoing expenses of .348
annually.
(2) The Dow Jones Equity REIT Total Return Index reflects both price changes
and dividend payouts of 118 equity REIT stocks. The S&P REIT Index is a
capitalization-weighted index of 100 REIT stocks. The Dow Jones Industrial
Average is a price-weighted index of 30 large-cap common stocks chosen as
representative of American Industry. The S&P 500 Stock Price Composite Index is
a capitalization weighted index of 500 large-cap common stocks.
Dividend Review
Twenty four of the Realty Majors increased their dividends by an average 10.5%
(most recent dividend versus prior year) see reverse for details.
Dividends are paid monthly or can be reinvested in additional units of the
Fund.
The annual dividend and current yield for each of the Realty Majors is listed
on the back of this form.
Sector Diversification as of 3/31/99
[Pie chart divided into sections labeled with section names and percentages]
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Section Name Percentage
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Shopping Centers 6%
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Regional Malls 14%
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Self Storage 5%
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Office/Industrial 10%
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Industrial 11%
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Apartment 22%
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Diversified 5%
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Health Care 5%
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Office 22%
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[copyright symbol] Merrill Lynch, Pierce, Fenner & Smith Incorporated. Member
SIPC. -- This material is authorized for client distribution only when
accompanied or preceded by a current prospectus.
Dividend Changes since inception -- 4/23/98 through 3/31/99
Twenty four companies have announced annualized dividend increases averaging
10.5% (most recent dividend versus prior year).
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% Change vs.
Company New Dividend Prior Year
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Crescent Real Estate Equities Co. $2.20 44.7%
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Kimco Realty Corp. 2.40 25.0(3)
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AvalonBay Communities, Inc. 2.04 24.4
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Equity Office Properties Trust 1.48 15.6
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Duke Realty Investments, Inc. 1.36 13.3
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First Industrial Realty Trust, Inc. 2.40 13.2
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Mack-Cali Realty Corp. 2.20 10.0
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Vornado Realty Trust 1.76 10.0
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Archstone Communities Trust 1.48 8.8
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Reckson Associates Realty Corp. 1.35 8.0
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Post Properties, Inc. 2.80 7.7
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Nationwide Health Properties, Inc. 1.80 7.1
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% Change vs.
Company New Dividend Prior Year
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The Rouse Company $1.20 7.1%
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Spieker Properties, Inc. 2.44 7.0
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Developers Diversified Realty Corp. 1.40 6.9
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Manufactured Home Communities, Inc. 1.55 6.9
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Health Care Properties Investors 2.72 6.3
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Equity Residential Properties 2.84 6.0
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Arden Realty, Inc. 1.78 6.0
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Highwoods Properties 2.16 5.9
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The Macerich Company 1.94 5.4
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ProLogis Trust 1.31 2.8
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Taubman Centers 0.96 2.1
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TriNet Corporate Realty Trust, Inc. 2.60 1.6
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(3) Excludes $0.05 Special Dividend
The Realty Majors Portfolio as of 3/31/99
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Price Annual
Company Symbol Per Share Dividend
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Archstone Communities Trust ASN $20.125 $1.48
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Arden Realty, Inc. ARI 22.250 1.78
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AvalonBay Communities, Inc. AVB 31.625 2.04
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Carr America Realty Corp. CRE 22.063 1.85
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Crescent Real Estate Equities Co. CEI 21.500 2.20
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Developers Diversified Realty Corp. DDR 14.313 1.40
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Duke Realty Investments, Inc. DRE 21.500 1.36
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Equity Office Properties Trust EOP 25.438 1.48
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Equity Residential Properties Trust EQR 41.250 2.84
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First Industrial Realty Trust, Inc. FR 23.938 2.40
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Health Care Property Investors, Inc. HCP 28.750 2.72
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Highwoods Properties, Inc. HIW 23.563 2.16
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Kimco Realty Corp. KIM 36.875 2.40
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The Macerich Company MAC 22.688 1.94
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Mack-Cali Realty Corp. CLI 29.375 2.20
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Manufactured Home Communities Inc. MHC 24.000 1.55
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Nationwide Health Properties, Inc. NHP 19.000 1.80
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Post Properties, Inc. PPS 36.000 2.80
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ProLogis Trust PLD 20.500 1.31
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Public Storage, Inc. PSA 25.000 0.88
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Reckson Associates Realty Corp. RA 20.563 1.35
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Reckson Services Industries, Inc.(4) RSII 4.500 0.0
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The Rouse Company RSE 22.188 1.20
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Simon Property Group, Inc. SPG 27.438 2.02
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Spieker Properties, Inc. SPK 35.250 2.44
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Taubman Centers, Inc. TCO 12.250 0.96
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TriNet Corporate Realty Trust, Inc. TRI 25.375 2.60
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Vornado Operating Co.(5) VOO 6.000 0.0
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Vornado Realty Trust VNO 34.500 1.76
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(4) Reckson Services Industries, Inc., spun off from Reckson Associates
Realty in June, 1998.
(5) Vornado Operating Co. was spun off from Vornado Realty Trust in October,
1998.
Current Market Cap Property
Company Dividend ($ in Millions) Sector
Yield(6)
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Archstone Communities Trust 7.4% $2,797 Apartment
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Arden Realty, Inc. 8.0 1,389 Office
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AvalonBay Communities, Inc. 6.5 2,035 Apartment
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Carr America Realty Corp. 8.4 1,583 Office
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Crescent Real Estate Equities 10.2 2,457 Office
Co.
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Developers Diversified Realty 9.8 877 Retail
Corp.
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Duke Realty Investments, Inc. 6.3 1,832 Office/
Industrial
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Equity Office Properties Trust 5.8 6,600 Office
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Equity Residential Properties 6.9 4,902 Apartment
Trust
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First Industrial Realty Trust, 10.0 910 Industrial
Inc.
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Health Care Property Investors, 9.5 892 Health Care
Inc.
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Highwoods Properties, Inc. 9.2 1,401 Office
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Kimco Realty Group 6.5 2,128 Retail
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The Macerich Company 8.6 768 Retail
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Mack-Cali Realty Corp. 7.5 1,712 Office
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Manufactured Home 6.5 638 Manufactured
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Communities Inc. Homes
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Nationwide Health Properties, 9.5 878 Health Care
Inc.
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Post Properties, Inc. 7.8 1,384 Apartment
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ProLogis Trust 6.4 3,294 Industrial
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Public Storage, Inc. 3.5 2,893 Self Storage
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Reckson Associates Realty 6.6 824 Office/
Corp. Industrial
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Reckson Services Industries, 0.0 111 Diversified
Inc. (7)
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The Rouse Company 5.4 1,522 Retail
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Simon Property Group, Inc. 7.4 4,488 Retail
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Spieker Properties, Inc. 6.9 2,157 Office/
Industrial
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Taubman Centers, Inc. 7.8 650 Retail
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TriNet Corporate Realty Trust, 10.2 631 Office/
Inc. Industrial
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Vornado Operating Co.(8) 0.0 25 Diversified
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Vornado Realty Trust 5.1 2,906 Diversified
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(6) Calculated by annualizing the latest quarterly or semi-annual ordinary
dividend declared and dividing the result by its market value as of the close
of trading on March 31, 1999.
(7) Reckson Services Industries, Inc., spun off from Reckson Associates
Realty in June, 1998.
(8) Vornado Operating Co. was spun off from Vornado Realty Trust in October,
1998.
The Fund is subject to special risk considerations similar to those associated
with the direct ownership of real estate due to its policy of concentration in
the securities of real estate companies. Real estate valuations may be
subject to factors such as changing general and local economic, financial,
competitive and environmental conditions. The Fund is also classified as
non-diversified and therefore is not limited in the proportion of its assets
that may be invested in a single issuer.
70137IN-4/99
[ML logo] Merrill Lynch
COHEN & STEERS
Realty Majors
[logo] Defined Asset Funds(SM)
Buy With Knowledge o Hold With Confidence
