<PAGE>
<PAGE>
- --------------------------------------------------------------------------------
COHEN & STEERS REALTY INCOME FUND, INC.
July 24, 1996
To Our Shareholders:
We are pleased to submit to you the semi-annual report for Cohen & Steers
Realty Income Fund, Inc. for the six months ended June 30, 1996. The net asset
value per share at that date was $9.03. In addition, a regular quarterly
dividend of $0.17 was declared for shareholders of record on June 21, 1996 and
paid on July 12, 1996.
MID-YEAR REVIEW
Real estate securities recorded a period of excellent absolute and relative
performance in the second quarter. For the first time since 1994, Equity REIT
returns matched those of common stocks as the S&P 500 Index and the NAREIT
Equity REIT Index both had a total return of 4.5%. In addition, these excellent
returns came amid a declining bond market; the total return of the Lehman
Brothers Government/Corporate Bond Index was 0.5%. The Fund's total return based
on income and change in net asset value for the quarter and the six months ended
June 30, 1996 were 5.1% and 9.2%, respectively.
The best performing broad industry group during the quarter was Shopping
Centers, led by the Regional Mall sector. It was our heavy concentration in
owners of shopping centers that enabled us to outperform the NAREIT Equity Index
in the second quarter and the first half of the year. This group, which was
perhaps the most out-of-favor in all of the real estate industry at the
beginning of the year, staged a dramatic recovery due to the fast growing
economy and high levels of consumer confidence and spending.
Capital-raising by REITs in the first half of 1996 approximated $3.4
billion in equity and $1.2 billion in debt. With modest capital appreciation the
stock market capitalization of all equity REITs rose by 12% to $64.9 billion at
June 30, compared to $58.1 billion six months earlier. There were no initial
public offerings of REITs so far this year and, in fact, there was a net
reduction of 5% in the number of existing equity REITs to 169 at June 30, from
178 at the beginning of the year. This is the result of an ongoing consolidation
of the industry with capital increasingly becoming more concentrated in the
hands of the largest companies.
This trend has raised several issues with regard to the influence of REITs
on the real estate industry in general and, in turn, the influence of investment
advisers on the REIT market. As we have mentioned in the past, the so-called
securitization of real estate over the past several years is the result of
investor recognition that capital market conditions must dictate the required
returns from all asset classes. This is unlike the situation that existed in the
1980s when the tax code allowed substantial tax relief for individuals owning
real estate even though that real estate may have been purchased on entirely
uneconomic terms. Similarly, real estate held directly by institutions was
valued on an appraisal system which often ignored economic realities of the
capital or real estate markets. In this period, a handful of firms dominated the
real estate syndication and investment advisory businesses. Along with highly
imprudent lending standards on the part of financial institutions, these factors
strongly contributed to speculation and an unprecedented boom in construction
that ended in what was perhaps the greatest real estate depression of all time.
By the early 1990's the real estate industry was in need of a complete
- --------------------------------------------------------------------------------
1
<PAGE>
<PAGE>
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COHEN & STEERS REALTY INCOME FUND, INC.
financial overhaul and recapitalization that was largely accomplished through
the public markets. The U.S. Government liquidated several hundred billion
dollars of assets seized from financial institutions. In the process, over 100
companies came public and together with the already-existing companies raised
over $50 billion in equity and debt.
This transformation from private to public ownership was painful for many
property owners and their real estate advisers but resulted in what is a much
more rational allocation of capital in the real estate industry. The current
consolidation of the industry is a logical extension of that allocation process,
with the best-managed and best-positioned companies enjoying healthy market
valuations and ready access to low-cost capital. These companies continue to
acquire property from private hands at a steady and substantial pace. Those
entities, both public and private, which are not efficient employers of capital
are either liquidating their portfolios or merging with those that are.
Importantly, unlike the environment in which the real estate investment advisers
of the 1980's operated, access to capital by the public companies is not
unconstrained; their cost of capital is largely controlled by the financial
market's continual evaluation of their investment strategy and performance. This
effectively provides a governor on the flow of capital and may, in the long run,
attenuate the amplitude of the real estate cycle by preventing many of the
excesses of the past from repeating themselves. This has caused many to believe
that the REIT industry is embarking on a period of substantial growth and
prosperity over the coming years.
A situation that has inspired some comment and criticism pertains to the
role of the investment advisory community on REITs and, by definition, the real
estate industry. Some observers have drawn a parallel between the real estate
advisers of the 1980s and the investment advisers of today, suggesting that
these advisers exert undue control or influence over the REIT market. The facts,
however, indicate otherwise. There are a number of institutional advisers who
specialize in REIT investments who control approximately 6% of the shares of
equity REITs on behalf of pension and endowment funds. Roughly another 4% of the
shares is owned by about 30 mutual funds that specialize in this area of
investment. Some firms, such as Cohen & Steers, represent both categories of
investors. This combined 10% ownership of the shares is insignificant compared
to the 90% held by insiders and the balance of the investment community at
large. It is therefore our opinion that any concerns about the concentration of
ownership by any firm or group is totally unwarranted. On the contrary, we
believe that the public market mechanism is as efficient for REITs as it is for
any other market sector and we believe that this will contribute to the
continued growth of the industry.
OUTLOOK
While owners of shopping centers are not as undervalued as they were at the
beginning of the year, we continue to find good value in this sector,
particularly in companies with above-average prospects for internal growth
through occupancy and rental increases, and external growth through acquisition.
We believe, however, that any material change in the outlook for continued
growth in the economy would cause us to consider reducing our weighting.
- --------------------------------------------------------------------------------
2
<PAGE>
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COHEN & STEERS REALTY INCOME FUND, INC.
We believe that real estate securities continue to offer investors a high
level of current income and are enjoying another year of strong dividend growth.
Increasingly, they are attracting the attention of investors seeking these
characteristics as well as low stock market sensitivity that provides portfolio
diversification. As a result, our portfolio currently appears headed toward a
year of satisfactory total returns.
Sincerely,
<TABLE>
<S> <C>
MARTIN COHEN ROBERT H. STEERS
MARTIN COHEN ROBERT H. STEERS
President Chairman
</TABLE>
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3
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COHEN & STEERS REALTY INCOME FUND, INC.
SCHEDULE OF INVESTMENTS
JUNE 30, 1996 (UNAUDITED)
<TABLE>
<CAPTION>
NUMBER VALUE
OF SHARES (NOTE 1)
--------- -----------
<S> <C> <C>
EQUITIES 93.61%
APARTMENT/RESIDENTIAL 24.09%
Ambassador Apartments........................................ 30,500 $ 514,688
Amli Residential Properties.................................. 25,500 525,938
Associated Estates Realty Corp............................... 42,900 900,900
Camden Property Trust........................................ 11,200 266,000
Colonial Properties Trust.................................... 43,400 1,052,450
Columbus Realty Trust........................................ 26,400 511,500
Pacific Gulf Properties...................................... 47,000 787,250
Summit Properties............................................ 24,700 484,736
Wellsford Residential Property Trust......................... 53,400 1,201,500
-----------
6,244,962
-----------
HEALTH CARE 8.16%
American Health Properties................................... 49,500 1,095,188
Omega Healthcare Investors................................... 36,900 1,019,362
-----------
2,114,550
-----------
INDUSTRIAL 4.98%
Eastgroup Properties......................................... 59,400 1,291,950
-----------
OFFICE 5.63%
Cali Realty Corp............................................. 33,500 812,375
Reckson Associates Realty Corp............................... 19,600 646,800
-----------
1,459,175
-----------
SHOPPING CENTER 50.75%
COMMUNITY CENTER 20.77%
Alexander Haagen Properties.................................. 38,900 495,975
Bradley Real Estate.......................................... 55,500 804,750
Mid-America Realty Investments............................... 111,200 973,000
Mid-Atlantic Realty Trust.................................... 34,100 338,869
Pennsylvania REIT............................................ 47,600 922,250
Price REIT................................................... 31,500 1,019,813
Regency Realty Corp.......................................... 28,300 594,300
Sizeler Property Investors................................... 26,900 235,374
-----------
5,384,331
-----------
</TABLE>
See notes to financial statements.
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4
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<PAGE>
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COHEN & STEERS REALTY INCOME FUND, INC.
SCHEDULE OF INVESTMENTS -- (CONTINUED)
JUNE 30, 1996 (UNAUDITED)
<TABLE>
<CAPTION>
NUMBER VALUE
OF SHARES (NOTE 1)
--------- -----------
<S> <C> <C>
FACTORY OUTLET CENTER 4.83%
Horizon Group................................................ 47,700 $ 977,850
Tanger Factory Outlet Centers................................ 11,700 272,025
-----------
1,249,875
-----------
REGIONAL MALL 25.15%
CBL & Associates Properties.................................. 27,400 613,075
DeBartolo Realty Corp........................................ 87,400 1,409,325
Glimcher Realty Trust........................................ 77,100 1,301,063
JP Realty.................................................... 43,400 927,675
Simon Property Group......................................... 9,200 225,400
Taubman Centers.............................................. 63,400 705,325
The Mills Corp............................................... 28,800 504,000
Urban Shopping Centers....................................... 35,100 833,625
-----------
6,519,488
-----------
TOTAL SHOPPING CENTER........................................ 13,153,694
-----------
TOTAL EQUITIES (Identified cost $22,282,881)........ 24,264,331
-----------
</TABLE>
<TABLE>
<CAPTION>
S&P PRINCIPAL
BOND RATING AMOUNT
- ------------------- ----------------
<S> <C> <C> <C> <C>
FIXED INCOME 5.19%
B Oriole Homes, 12.50%, sr. sub. notes 1/15/03................. $1,000,000 880,000
BB- Trizec Finance Ltd., 10.875%, sr. notes 10/15/05............. 450,000 463,500
-----------
TOTAL FIXED INCOME (Identified cost $1,419,050)........ 1,343,500
-----------
TOTAL INVESTMENTS (Identified cost $23,701,931)....................... 98.80% 25,607,831
OTHER ASSETS, LESS LIABILITIES........................................ 1.20% 311,840
---------- -----------
NET ASSETS (Equivalent to $9.03 per share based on
2,870,964 shares of capital stock outstanding)..................... 100.00% $25,919,671
---------- -----------
---------- -----------
</TABLE>
See notes to financial statements.
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5
<PAGE>
<PAGE>
- --------------------------------------------------------------------------------
COHEN & STEERS REALTY INCOME FUND, INC.
STATEMENT OF ASSETS AND LIABILITIES
JUNE 30, 1996 (UNAUDITED)
<TABLE>
<S> <C>
ASSETS:
Investments in securities, at value (Identified cost $23,701,931) (Note 1).................... $25,607,831
Cash.......................................................................................... 674,243
Receivable for investment securites sold...................................................... 435,606
Dividends and interest receivable............................................................. 271,761
Other assets.................................................................................. 6,914
-----------
Total Assets............................................................................ 26,996,355
-----------
LIABILITIES:
Payable for investment securities purchased................................................... 519,705
Payable for dividends declared................................................................ 488,064
Payable to investment adviser................................................................. 12,258
Payable to administrator...................................................................... 11,139
Other liabilities............................................................................. 45,518
-----------
Total Liabilities....................................................................... 1,076,684
-----------
NET ASSETS applicable to 2,870,964 shares of $.01 par value common stock
outstanding (Note 4)............................................................................. $25,919,671
-----------
-----------
NET ASSET VALUE PER SHARE:
($25,919,671 [div] 2,870,964 shares outstanding)................................................. $ 9.03
-----------
-----------
MARKET PRICE PER SHARE:............................................................................. $ 9.25
-----------
-----------
MARKET PRICE PREMIUM (DISCOUNT) TO NET ASSET VALUE PER SHARE:....................................... 2.44%
-----------
-----------
NET ASSETS consist of:
Paid-in capital (Note 4)...................................................................... $23,160,887
Distributions in excess of net investment income.............................................. (26,035)
Accumulated net realized gain on investments.................................................. 878,919
Net unrealized appreciation on investments.................................................... 1,905,900
-----------
$25,919,671
-----------
-----------
</TABLE>
See notes to financial statements.
- --------------------------------------------------------------------------------
6
<PAGE>
<PAGE>
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COHEN & STEERS REALTY INCOME FUND, INC.
STATEMENT OF OPERATIONS
FOR THE SIX MONTHS ENDED JUNE 30, 1996 (UNAUDITED)
<TABLE>
<S> <C>
Investment Income:
Dividend income................................................................................ $1,045,044
Interest income................................................................................ 86,969
----------
Total Income............................................................................. 1,132,013
----------
Expenses:
Investment advisory fees (Note 2).............................................................. 81,449
Administrative fees (Note 2)................................................................... 26,587
Professional fees.............................................................................. 22,008
Directors' fees and expenses (Note 2).......................................................... 14,017
Reports to shareholders........................................................................ 13,072
Transfer agent fees............................................................................ 12,126
Custodian fees................................................................................. 6,658
Miscellaneous.................................................................................. 6,823
----------
Total Expenses........................................................................... 182,740
----------
Net Investment Income................................................................................ 949,273
----------
Realized and Unrealized Gain on Investments:
Net realized gain on investments............................................................... 503,929
Increase in unrealized appreciation on investments............................................. 776,893
----------
Net realized and unrealized gain on investments.......................................... 1,280,822
----------
Net increase in net assets resulting from operations................................................. $2,230,095
----------
----------
</TABLE>
See notes to financial statements.
- --------------------------------------------------------------------------------
7
<PAGE>
<PAGE>
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COHEN & STEERS REALTY INCOME FUND, INC.
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
SIX MONTHS ENDED
JUNE 30, 1996 YEAR ENDED
(UNAUDITED) DECEMBER 31, 1995
---------------- -----------------
<S> <C> <C>
Change in Net Assets:
From Operations:
Net investment income.................................... $ 949,273 $ 1,833,008
Net realized gain (loss) on investments.................. 503,929 (943,735)
Increase in unrealized appreciation on investments....... 776,893 1,887,754
---------------- -----------------
Net increase in net assets resulting from
operations...................................... 2,230,095 2,777,027
---------------- -----------------
Dividends and Distributions From (Note 4):
Net investment income.................................... (975,308) (1,134,113)
Tax return of capital.................................... -- (806,210)
---------------- -----------------
Total distributions to shareholders................ (975,308) (1,940,323)
---------------- -----------------
Capital Stock Transactions (Note 4):
Net asset value of shares issued to shareholders in
reinvestment of dividends and distributions from net
investment income..................................... 87,491 192,542
---------------- -----------------
Total increase in net assets....................... 1,342,278 1,029,246
Net Assets:
Beginning of period...................................... 24,577,393 23,548,147
---------------- -----------------
End of period (including distributions in
excess of net investment income of $26,035
at June 30, 1996)..................................... $ 25,919,671 $24,577,393
---------------- -----------------
---------------- -----------------
</TABLE>
See notes to financial statements.
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8
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<PAGE>
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COHEN & STEERS REALTY INCOME FUND, INC.
FINANCIAL HIGHLIGHTS
The following table includes selected data for a share outstanding
throughout each period and other performance information derived from the
Financial Statements. It should be read in conjunction with the Financial
Statements and notes thereto.
<TABLE>
<CAPTION>
SIX MONTHS ENDED YEAR ENDED DECEMBER 31,
JUNE 30, 1996 ----------------------------------------------------
PER SHARE OPERATING PERFORMANCE (UNAUDITED) 1995 1994 1993 1992 1991
------------------------------- ---------------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period.......... $ 8.59 $ 8.30 $ 8.70 $ 7.63 $ 7.35 $ 5.33
-------- ------- ------- ------- ------- -------
Income from investment operations:
Net investment income.................... 0.33 0.64 0.65 0.65 0.65 0.64
Net realized and unrealized gains
(losses) on investments............... 0.45 0.33 (0.31) 1.10 0.31 2.06
-------- ------- ------- ------- ------- -------
Total from investment operations... 0.78 0.97 0.34 1.75 0.96 2.70
-------- ------- ------- ------- ------- -------
Less distributions from:
Net investment income.................... (0.34) (0.40) (0.49) (0.65) (0.65) (0.64)
In excess of net investment income....... 0.00 0.00 0.00 (0.03) 0.00 0.00
Capital gain............................. 0.00 0.00 (0.09) 0.00 0.00 0.00
Tax return of capital.................... 0.00 (0.28) (0.16) 0.00 (0.03) (0.04)
-------- ------- ------- ------- ------- -------
Total distributions................ (0.34) (0.68) (0.74) (0.68) (0.68) (0.68)
-------- ------- ------- ------- ------- -------
Net asset value, end of period................ $ 9.03 $ 8.59 $ 8.30 $ 8.70 $ 7.63 $ 7.35
-------- ------- ------- ------- ------- -------
-------- ------- ------- ------- ------- -------
Per share market value, end of period......... $ 9.25 $ 9.13 $ 8.50 $ 9.50 $ 8.00 $ 7.13
-------- ------- ------- ------- ------- -------
-------- ------- ------- ------- ------- -------
- -------------------------------------------------------------------------------------------------------------------
Total investment return(c)(e)................. 5.28% 15.97% (2.78)% 27.77% 22.64% 68.96%
-------- ------- ------- ------- ------- -------
-------- ------- ------- ------- ------- -------
Total net asset value return(c)(e)............ 9.20% 12.12% 3.80% 23.04% 13.63% 51.93%
-------- ------- ------- ------- ------- -------
-------- ------- ------- ------- ------- -------
- -------------------------------------------------------------------------------------------------------------------
Ratios/Supplemental Data:
Net assets, end of period (in
millions)............................. $ 25.920 $24.577 $23.548 $24.502 $21.323 $20.379
-------- ------- ------- ------- ------- -------
-------- ------- ------- ------- ------- -------
Ratios of expenses to average net
assets................................ 1.45%(a) 1.73% 1.51%(b) 1.64% 1.63% 1.66%
-------- ------- ------- ------- ------- -------
-------- ------- ------- ------- ------- -------
Ratio of net investment income to average
net assets............................ 7.55%(a) 7.67% 7.62% 7.31% 8.65% 9.26%
-------- ------- ------- ------- ------- -------
-------- ------- ------- ------- ------- -------
Portfolio turnover rate.................. 28.89%(a) 37.75% 80.68% 107.91% 79.51% 77.62%
-------- ------- ------- ------- ------- -------
-------- ------- ------- ------- ------- -------
Average Commission Rate(d)............... $ 0.0663 N/A N/A N/A N/A N/A
-------- ------- ------- ------- ------- -------
-------- ------- ------- ------- ------- -------
</TABLE>
- ------------------------
(a) Annualized.
(b) Fees paid through directed brokerage commissions have been excluded. Had
these fees been paid by the Fund, the ratio would have been 1.69%.
(c) Total returns for periods of less than one year are not annualized.
(d) For fiscal years beginning on or after September 1, 1995, a portfolio is
required to disclose the average commission rate per share it paid for
trades on which commissions were charged.
(e) Total investment return is computed based upon the American Stock Exchange
market price of the Fund's shares and excludes the effects of brokerage
commissions. Dividends and distributions, if any, are assumed for purposes
of this calculation, to be reinvested at prices obtained under the Funds's
dividend reinvestment plan. Total net asset value return measures the
changes in value over the period indicated taking into account reinvested
dividends.
See notes to financial statements.
- --------------------------------------------------------------------------------
9
<PAGE>
<PAGE>
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COHEN & STEERS REALTY INCOME FUND, INC.
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)
NOTE 1 -- SIGNIFICANT ACCOUNTING POLICIES
Cohen & Steers Realty Income Fund, Inc. (the 'Fund') is a non-diversified,
closed-end management investment company. The Fund was incorporated under the
laws of the State of Maryland on June 21, 1988. The following is a summary of
significant accounting policies followed by the Fund in the preparation of its
financial statements. The policies are in conformity with generally accepted
accounting principles. The preparation of the financial statements in accordance
with generally accepted accounting principles requires management to make
estimates and assumptions that affect the reported amount and estimates on the
financial statements. Actual results could differ from those estimates.
Portfolio Valuation: Investments in securities that are listed on the New
York Stock Exchange are valued, except as indicated below, at the last sale
price reflected at the close of the New York Stock Exchange on the business day
as of which such value is being determined. If there has been no sale on such
day, the securities are valued at the mean of the closing bid and asked prices
for the day.
Securities not listed on the New York Stock Exchange but listed on other
domestic or foreign securities exchanges or admitted to trading on the National
Association of Securities Dealers Automated Quotations, Inc. ('NASDAQ') National
Market System are valued in a similar manner. Securities traded on more than one
securities exchange are valued at the last sale price on the business day as of
which such value is being determined as reflected on the tape at the close of
the exchange representing the principal market for such securities.
Readily marketable securities traded in the over-the-counter market,
including listed securities whose primary market is believed by the Adviser to
be over-the-counter, but excluding securities admitted to trading on the NASDAQ
National List, are valued at the mean of the current bid and asked prices as
reported by NASDAQ, the National Quotations Bureau or such other comparable
sources as the Board of Directors deems appropriate to reflect their fair market
value. Where securities are traded on more than one exchange and also
over-the-counter, the securities will generally be valued using the quotations
the Board of Directors believes reflect most closely the value of such
securities.
Short-term debt securities, which have a maturity of 60 days or less, are
valued at amortized cost which approximates value.
Security Transactions and Investment Income: Security transactions are
recorded on trade date. Realized gains and losses on investments sold are
recorded on the basis of identified cost for accounting and tax purposes.
Interest income is recorded on the accrual basis. Dividend income is recorded on
ex-dividend date.
Dividends and Distributions to Shareholders: Dividends from net investment
income are declared and paid quarterly. Net realized capital gains, unless
offset by any available capital loss carryforward, are distributed to
shareholders annually. Distributions to shareholders are recorded on the
ex-dividend date.
Dividends from net income and capital gain distributions are determined in
accordance with U.S. Federal Income Tax regulations which may differ from
generally accepted accounting principles.
Federal Income Taxes: The Fund has qualified and intends to remain
qualified as a regulated investment company under Subchapter M of the Internal
Revenue Code of 1986. The principal tax benefits of qualifying as a regulated
investment company, as compared to an ordinary taxable corporation, are that a
regulated investment
- --------------------------------------------------------------------------------
10
<PAGE>
<PAGE>
- --------------------------------------------------------------------------------
COHEN & STEERS REALTY INCOME FUND, INC.
NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)
company is not itself subject to federal income tax on ordinary investment
income and net capital gains that are currently distributed (or deemed
distributed) to its shareholders and that the tax character of long-term capital
gains recognized by a regulated investment company flows through to its
shareholders who received such distributions. At December 31, 1995, the Fund had
for federal income tax purposes, an unused capital loss carryforward of $453,458
to be applied against future realized gains, if any. If not applied, the capital
loss carryforward will expire in 2003.
NOTE 2 -- INVESTMENT ADVISORY AND ADMINISTRATIVE FEES AND OTHER TRANSACTIONS
WITH AFFILIATES
Investment Advisory Fees: Cohen & Steers Capital Management, Inc. (the
'Adviser') serves as the Fund's Investment Adviser pursuant to an investment
advisory agreement (the 'Advisory Agreement'). Under the terms of the Advisory
Agreement, the Adviser provides the Fund with the day-to-day investment
decisions and generally manages the Fund's investments in accordance with the
stated policies of the Fund, subject to the supervision of the Fund's Board of
Directors. For the services provided to the Fund, the Adviser receives a monthly
fee in an amount equal to 1/12th of .65% of the average daily net assets of the
Fund (approximately .65% on an annual basis). For the six months ended June 30,
1996, the Fund incurred $81,449 in advisory fees.
Administrative Fees: The Chase Manhattan Bank, N.A., through its affiliate
Chase Global Funds Services Company ('CGFSC') (the Administrator), serves as the
Fund's Administrator pursuant to an Administration Agreement (the 'Agreement').
Under the terms of the Agreement, the Administrator maintains the Fund's books
and records, prepares financial information for the Fund's tax returns, proxy
statements, quarterly and annual reports to shareholders and generally assists
in all aspects of Fund operations, other than providing investment advice,
subject to the supervision of the Fund's Board of Directors. For the services
provided the Fund, the Administrator receives a monthly fee in an amount equal
to 1/12th of .20% of the average daily net assets of the Fund (approximately
.20% on an annual basis). For the six months ended June 30, 1996, the Fund
incurred $26,587 in administration fees.
Directors' Fees: Certain directors of the Fund are also directors, officers
and/or employees of the Adviser. None of the directors so affiliated received
compensation for their services as directors of the Fund with the exception of
out-of-pocket expenses relating to attendance at Board and committee meetings.
Similarly, none of the Fund's officers received compensation from the Fund. Fees
and related expenses accrued for non-affiliated directors totaled $14,017 for
the six months ended June 30, 1996.
NOTE 3 -- PURCHASES AND SALES OF SECURITIES
Purchases and sales of securities, excluding short-term investments, for
the six months ended June 30, 1996 aggregated $3,630,271 and $3,747,525,
respectively.
- --------------------------------------------------------------------------------
11
<PAGE>
<PAGE>
- --------------------------------------------------------------------------------
COHEN & STEERS REALTY INCOME FUND, INC.
NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)
At June 30, 1996, the cost and unrealized appreciation or depreciation in
value of the investments owned by the Fund, as computed on a federal income tax
basis, are as follows:
<TABLE>
<S> <C>
Aggregate cost.......................................................................... $23,701,931
-----------
Gross unrealized appreciation........................................................... $ 2,553,789
Gross unrealized depreciation........................................................... $ (647,889)
-----------
Net unrealized appreciation............................................................. $ 1,905,900
-----------
-----------
</TABLE>
NOTE 4 -- CAPITAL STOCK AND DISTRIBUTION REINVESTMENT
At June 30, 1996, the Fund has one class of common stock, par value $.01
per share, of which 6,900,000 shares are authorized and 2,870,964 shares are
outstanding.
Distributions in 1996 resulted in 10,048 shares being issued at an average
price of $8.71 through the dividend reinvestment plan.
Registered shareholders may elect to receive all distributions in cash paid
by check mailed directly to the shareholder by The Chase Manhattan Bank, N.A.
('Chase') as dividend paying agent. Pursuant to the Automatic Reinvestment Plan
(the 'Plan') shareholders not making such election will have all amounts
automatically reinvested by Chase, as the Plan agent in whole or fractional
shares of the Fund.
NOTE 5 -- SELECTED QUARTERLY FINANCIAL DATA (UNAUDITED)
<TABLE>
<CAPTION>
NET INCREASE
NET REALIZED (DECREASE)
TOTAL NET AND UNREALIZED IN NET ASSETS
INVESTMENT INVESTMENT GAIN (LOSS) RESULTING NET ASSETS AT
INCOME INCOME ON INVESTMENTS FROM OPERATIONS END OF PERIOD
----------------- ----------------- ------------------- ------------------ ------------------
QUARTERLY PER PER PER PER PER
PERIOD AMOUNT SHARE AMOUNT SHARE AMOUNT SHARE AMOUNT SHARE AMOUNT SHARE
- ---------------------------------- ---------- ----- ---------- ----- ----------- ------ ---------- ------ ----------- -----
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
FISCAL 1996
- -----------
March 31.......................... $ 536,236 $0.19 $ 444,453 $0.16 $ 493,917 $ 0.17 $ 938,370 $ 0.33 $25,073,634 $8.75
June 30........................... 595,777 0.20 504,820 0.17 786,905 0.28 1,291,725 0.45 25,919,671 9.03
---------- ----- ---------- ----- ----------- ------ ---------- ------
$1,132,013 $0.39 $ 949,273 $0.33 $ 1,280,822 $ 0.45 $2,230,095 $ 0.78
---------- ----- ---------- ----- ----------- ------ ---------- ------
---------- ----- ---------- ----- ----------- ------ ---------- ------
FISCAL 1995
- -----------
March 31.......................... $ 539,726 $0.19 $ 436,860 $0.15 $ (515,916) $(0.18) $ (79,056) $(0.03) $23,044,970 $8.10
June 30........................... 513,451 0.18 405,020 0.14 948,709 0.33 1,353,729 0.47 23,958,714 8.40
September 30...................... 548,067 0.19 431,265 0.15 474,071 0.17 905,336 0.32 24,908,041 8.72
December 31....................... 645,437 0.23 559,863 0.20 37,155 0.01 597,018 0.21 24,577,393 8.59
---------- ----- ---------- ----- ----------- ------ ---------- ------
$2,246,681 $0.79 $1,833,008 $0.64 $ 944,019 $ 0.33 $2,777,027 $ 0.97
---------- ----- ---------- ----- ----------- ------ ---------- ------
---------- ----- ---------- ----- ----------- ------ ---------- ------
FISCAL 1994
- -----------
September 30...................... $ 377,737 $0.13 $ 282,496 $0.10 $ (463,803) $(0.16) $ (181,307) $(0.06) $25,146,129 $8.80
December 31....................... 619,151 0.19 517,212 0.16 (1,027,521) (0.34) (510,309) (0.18) 23,548,147 8.30
---------- ----- ---------- ----- ----------- ------ ---------- ------
996,888 $0.32 $ 799,708 $0.26 $(1,491,324) $(0.50) $ (691,616) $ 0.24
---------- ----- ---------- ----- ----------- ------ ---------- ------
---------- ----- ---------- ----- ----------- ------ ---------- ------
</TABLE>
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12
<PAGE>
<PAGE>
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COHEN & STEERS REALTY INCOME FUND, INC.
NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)
NOTE 6 -- SHAREHOLDER MEETING
During the six-month period ended June 30, 1996, Cohen & Steers Realty
Income Fund, Inc. shareholders voted on proposals at the annual meeting held on
April 25, 1996. The description of each proposal and number of shares voted are
as follows:
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------------------------------
SHARES VOTED SHARES VOTED
FOR WITHOUT AUTHORITY
- --------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
1. To elect Gregory C. Clark as a Director of the Fund to 2,573,431 23,670
hold office for a term of three years and until his
successor is duly elected and qualified.
<CAPTION>
- --------------------------------------------------------------------------------------------------------------
SHARES VOTED SHARES VOTED SHARES VOTED
FOR AGAINST ABSTAIN
- --------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
2. To select Coopers & Lybrand, L.L.P. as the Fund's 2,563,485 12,311 21,305
independent auditors.
- --------------------------------------------------------------------------------------------------------------
</TABLE>
Notice is hereby given in accordance with Section 23(c) of the Investment
Company Act of 1940 that the Fund may purchase, from time to time, shares of its
common stock in the open market.
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13
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COHEN & STEERS REALTY INCOME FUND, INC.
[This page intentionally left blank]
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14
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COHEN & STEERS REALTY INCOME FUND, INC.
OFFICERS AND DIRECTORS
Robert H. Steers
Director and Chairman
Martin Cohen
Director and President
Gregory C. Clark
Director
George Grossman
Director
Jeffrey H. Lynford
Director
Willard H. Smith, Jr.
Director
Elizabeth O. Reagan
Vice President
INVESTMENT ADVISER
Cohen & Steers Capital Management, Inc.
757 Third Avenue
New York, New York 10017
(212) 832-3232
FUND ADMINISTRATOR AND TRANSFER AGENT
Chase Global Funds Services Co.
73 Tremont Street
Boston, Massachusetts 02108
(800) 437-9912
CUSTODIAN
The Chase Manhattan Bank, N.A.
770 Broadway
New York, New York 10003
LEGAL COUNSEL
Dechert Price & Rhoads
477 Madison Avenue
New York, New York 10022
American Stock Exchange Symbol: RIF
This report is for shareholder information. This is not a prospectus intended
for use in the purchase or sale of Fund shares.
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15
<PAGE>
<PAGE>
- --------------------------------------------------------------------------------
COHEN & STEERS
REALTY INCOME FUND
757 THIRD AVENUE
NEW YORK, N.Y. 10017
[COHEN & STEERS LOGO]
SEMI-ANNUAL REPORT
JUNE 30, 1996
- --------------------------------------------------------------------------------
STATEMENT OF DIFFERENCES
The mathematical division symbol will be represented by [div]
