<PAGE> 1
TABLE OF CONTENTS
Portfolio Manager's Report to Shareholders
PAGE 2
Schedule of Portfolio Investments
PAGE 10
Statement of Assets and Liabilities
PAGE 12
Statement of Operations
PAGE 13
Statement of Changes in Net Assets
PAGE 14
Notes to Financial Statements
PAGE 15
Financial Highlights
PAGE 23
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-1-
<PAGE> 2
Portfolio Manager's Report to Shareholders Alpine International Real Estate
Equity Fund
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Value of a $10,000 Investment
MSCI GPR Y Class
<S> <C> <C> <C>
2/1/89 (Inception) 10000.00 10000.00 10000.00
4/30/89 9457.16 9901.26 10010.00
10/31/89 9303.55 10302.10 9800.00
4/30/90 6966.55 8512.84 9579.66
10/31/90 6774.81 8268.63 8633.90
4/30/91 7626.28 8708.65 9874.57
10/31/91 7657.26 8735.16 9111.86
4/30/92 6788.26 7958.99 8827.12
10/31/92 6606.37 8129.01 9315.26
4/30/93 8130.81 9763.09 12030.20
10/31/93 10141.80 11314.70 14600.50
4/30/94 10263.00 11988.70 14684.00
10/31/94 10686.50 12252.40 14210.00
4/30/95 9656.00 11714.10 12058.70
10/31/95 10426.10 11963.90 12833.80
4/30/96 12566.00 13390.50 14528.00
10/31/96 13359.70 14248.20 13631.10
4/30/97 13542.80 14141.60 12622.40
10/31/97 11566.40 13351.80 14386.00
4/30/98 10884.40 12754.70 16914.90
10/31/98 9836.08 11539.50 14374.90
</TABLE>
Past performance is not predictive of future results. Investment return and
principal value of the Alpine International Real Estate Fund will fluctuate, so
that the shares, when redeemed, may be worth more or less than their original
cost. The returns set forth reflect the waiver of certain advisory or
administrative fees. Without the waiver of fees, total return would have been
lower.
The GPR-Global Real Estate Securities Index and the MSCI Morgan Stanley Real
Estate Index are global market capitalization weighted performance indexes of
listed property and real estate securities.
* Prior to 4/30/94, the performance numbers do not reflect dividends.
International investing involves increased risk and volatility.
<TABLE>
<CAPTION>
COMPARATIVE TOTAL RETURNS AS OF 10/31/98
- ---------------------------------------------------------------------------------------
SINCE
1 YEAR 3 YEAR 5 YEAR INCEPTION+
- ---------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Alpine Y Class (0.08)% 3.85% (0.31)% 3.79%
Alpine A Class (4.75%)* (5.08)% 1.99% (1.40)% 3.21%
Alpine B Class (5.00%)* (5.90)% 1.97% (1.33)% 3.45%
Alpine C Class (1.00%)* (2.09)% 2.89% (0.97)% 3.44%
- ---------------------------------------------------------------------------------------
GPR Global Real Estate Securities Index (13.57)% (1.20)% (0.39)% 1.48%
MSCI Morgan Stanley Real Estate Index (14.96)% (1.92)% (0.61)% (0.17)%
</TABLE>
* Represents maximum sales load.
+ Performance of Investor A Class, B Class and C Class shares for the period
prior to their inceptions on 2/10/95, 2/8/95 and 2/9/95, respectively,
represents performance for Y Class shares, which commenced operations on 2/1/89.
- --------------------------------------------------------------------------------
-2-
<PAGE> 3
Portfolio Manager's Report to Shareholders Alpine International Real Estate
Equity Fund
- --------------------------------------------------------------------------------
Dear Shareholder:
We are pleased to present the Alpine International Real Estate Equity Fund's
Annual Report to Shareholders for the fiscal year ended October 31, 1998. The
past twelve months have proven unsettling for the world's real estate markets
and most challenging for its financial markets. In this report, we will discuss
the Fund's performance as well as issues and trends, which are effecting real
estate and securities markets.
Q. WHAT WAS THE ALPINE INTERNATIONAL REAL ESTATE EQUITY FUND'S PERFORMANCE FOR
THE FISCAL YEAR ENDED OCTOBER 31, 1998?
A. We are pleased to report to shareholders that your Fund out-performed its
benchmark Global Property Research (GPR) Global Real Estate Securities Index*
during the 1998 fiscal year, producing a total return of -0.08%. By
comparison, the GPR index declined -13.57% for the one year period ended
October 31, 1998. The Fund also outperformed the MSCI Morgan Stanley Real
Estate Index*(1), which fell -14.96% for the same period. It is worth noting
that, despite its negative return, the GPR Index has outperformed all of the
broad U.S. real estate securities indices for the year to date for the first
time since 1993. While this summer's near-meltdown of global financial
markets eroded some of the Alpine International Real Estate Fund's strong
absolute and relative out-performance from mid-year, we believe the silver
lining of such disruption in financial markets is new opportunities for
investors.
Q. HOW DID THE ALPINE INTERNATIONAL REAL ESTATE EQUITY FUND ACHIEVE HIGHER
RETURNS THAN ITS BENCHMARK OVER THE PAST TWELVE MONTHS?
A. Principally, the Fund benefited from active portfolio management which
combined country selection, stock selection and timely transitions between
investments. These shifts by country and sector were essentially reflecting
individual stock selections based on both opportunistic situations for the
near to medium term, as well as investments where we believe property stocks
are near cyclical troughs from which long term appreciation potential may
result.
The Fund also benefited from an increase in international merger and
acquisition activity. BERNHEIM-COMOFI of Belgium was acquired by Security
Capital Group of the U.S. FASTIGHETS NACKEBRO of Sweden was acquired by a
domestic competitor, Drott, and HORIZON GROUP was acquired by its major U.S.
competitor, Prime Retail. The shares of SOCIETE DU LOUVRE (7.0% of net assets
as of 10/31/98) in France rose in response to a so far unsuccessful takeover
bid from a group led by Asher Edelman.
Over the course of the past twelve months the Fund's performance
benefited from timely shifting investments into stocks, sectors and countries
which appeared relatively undervalued. This accounts for a significant
increase in the Fund's historic portfolio turnover rate to 82%. In comparison
with the portfolio as of October 31, 1997, there have been a number of
significant changes. During the course of the year, the Fund sold its
positions in Belgium and Malaysia while establishing new holdings in New
Zealand, Singapore and Finland. The Fund's holdings in Southeast Asia were
expanded from 7.2% to 16.3%. Singapore rose
- ---------------
*The Global Property Research (GPR) Global Real Estate Securities Index and the
MSCI Morgan Stanley Real Estate Index are global market capitalization weighted
performance indexes of listed property and real estate securities.
(1)With this report we are replacing the MSCI Morgan Stanley Real Estate Index
with the GPR Index as our new benchmark because of its more comprehensive and
accurate reflection of the world's property securities markets.
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-3-
<PAGE> 4
Portfolio Manager's Report to Shareholders Alpine International Real Estate
Equity Fund
- --------------------------------------------------------------------------------
from 0% representation to 5.4% of the Fund and Hong Kong's weighting was
increased from 3% to 6.1%. Productive investments were also made in the
Philippines during the fall. Funding for such new investments came from a
number of countries including the U.S. which was reduced from 25.2% to 20.3%
of the Fund and Latin America which was reduced from 8.4% to 5.0%,
principally through a reduction in the Fund's investments in Mexico at
mid-year. While our holdings in Spain increased from 5.2% to 9.9% through
performance and additions to the Fund's shareholdings in both INMOBILIARIA
URBIS (1.9%) and VALLEHERMOSA, (2.4%) as well as new positions in PRIMA
INMOBILIARIA (3.5%) and MELIA INVERSIONES AMERICANAS, (0.5%) the Fund's
overall holdings in Europe actually fell from 45.5% to 38.9%, reflecting a
near halving of our exposure to Scandinavia. These sales also helped to fund
increased investments in Canada which now represents the Fund's fourth
largest country exposure with 9.1% versus only 4.4% last year. Notably, the
Fund's fifth largest country exposure is in Japan at 6.2%, down from 8.9%
last year.
Q. WHAT WAS THE IMPACT OF THIS PAST SUMMER'S EXTREME MARKET VOLATILITY ON BOTH
THE FUND, REAL ESTATE SECURITIES AND REAL ESTATE ITSELF?
A. The financial market's uncertainty over an economic collapse particularly
hurt investors' perceptions of economically sensitive sectors such as real
estate. The impact on real estate securities and real estate itself has been
quite significant, in effect by making the debt and equity capital available
to real estate investors more expensive. Currently real estate investors must
pay risk-adjusted yields at much higher premiums than recent norms. This has
temporarily stalled many types of financial transactions, ultimately slowing
business activity. The possible long-term trends from such a slowdown have
yet to unfold, but are already being discounted in the price of real estate
securities. Thus, your Fund has been adversely impacted by the fall of share
prices where investors are uncertain over both the duration of this secular
liquidity contraction and its influence on cyclical levels of demand.
Market observers believe that stock prices often foretell the direction
of the economy and, thus, share price performance from late July through
early October might suggest that a recession is around the corner. For
fragile economies we think this will be the case. Those weak countries which
were initially hurt by collapsing currencies a year ago have experienced high
unemployment, bankruptcies and bank foreclosures. Their continuing malaise
played a part in the spiraling confluence of events which reached a crescendo
of panic with the near collapse and rescue of the giant hedge fund, Long Term
Capital Management.
For diversified and developed economies, we do not believe the global
business cycle has ended. To the contrary, we believe this business cycle may
even be extended by the reaction to this global financial panic. While the
U.S. and Europe have deep, broad economies, they cannot forever remain
islands of prosperity as the global slow-down and liquidity contraction will
likely reduce economic growth rates in the new year. In response to this
threat of collapsing financial liquidity around the world, the dominant G-7
central banks have abandoned their twenty-year crusade against inflationary
growth. We believe the effect of recent significant monetary easing and
fiscal stimulus should prevent recessions in the major developed economies
and provide significant stimulus for both the business cycle and real estate
markets around the globe as we approach the next millennium.
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<PAGE> 5
Portfolio Manager's Report to Shareholders Alpine International Real Estate
Equity Fund
- --------------------------------------------------------------------------------
GEOGRAPHICAL DISTRIBUTION*
[GEOGRAPHICAL DISTRIBUTION PIE GRAPH]
SECTOR DISTRIBUTION*
[SECTOR DISTRIBUTION PIE GRAPH]
TOP 10 HOLDINGS*
<TABLE>
<CAPTION>
<C> <S> <C> <C> <C> <C>
6. IRSA Inversiones Y Representaciones SA
1. Societe du Louvre (France) 7.17% (Argentina) 3.60%
2. U.S. Home Corp. (U.S.) 5.05% 7. Dundee Realty Corp. (Canada) 3.32%
3. Alexander's, Inc. (U.S.) 4.98% 8. European City Estates N.V. (Netherlands) 3.21%
Societe des Immeubles de France
4. (France) 4.83% 9. Tachihi Enterprise Co., Ltd. (Japan) 2.82%
5. Prima Immobiliaria SA (Spain) 3.64% 10. Thorkild Kristensen A/S (Denmark) 2.62%
</TABLE>
* Portfolio composition subject to change.
Q. AT WHAT POINT ARE DIFFERENT COUNTRIES OR REGIONS IN TERMS OF THEIR BUSINESS
CYCLES AND REAL ESTATE CYCLES?
A. As the world's major economic engine of growth, the U.S. is already seven
years into the current business cycle and its real estate markets have fully
recovered from the major recession in 1990. If we are correct in our reading
of the world's financial situation, there could be another three or perhaps
even five years of potential domestic economic expansion. This would be
positive for U.S. real estate in that real estate typically outperforms many
other sectors of the economy during the latter stages of the business cycle.
The greatest real estate capital appreciation potential historically
occurs during the recovery periods which mark the transition from recession
to expansion. Regions and countries which offer such potential are most
notably those in Southeast Asia. However, estimating demand for real estate
based on the pace of recovery of different countries' business cycles must be
combined with the potential for local real estate markets to absorb what in
certain cities or sectors are staggering excesses of supply. As a result, the
period of recuperation and then
- --------------------------------------------------------------------------------
-5-
<PAGE> 6
Portfolio Manager's Report to Shareholders Alpine International Real Estate
Equity Fund
- --------------------------------------------------------------------------------
recovery of property values will vary significantly through the region.
Japan is unique in that it is still recuperating from its bubble of
excess liquidity during the 1980's. Japan suffers from a lack of domestic
demand and inefficient mechanisms for distributing financial liquidity
throughout the economy. Both Japan's banking system and corporate practices
are reflecting stress from reluctantly restructuring its fiscal model. Thus,
Japan remains mired in a seven-year economic decline. Though we remain
hopeful that the current, massive economic stimulus package will begin to
resuscitate the economy, the limited real estate supply situation in itself
does not signal an imminent recovery without an upswing in demand.
Europe, on the other hand, has been enjoying a real estate recovery for
the last few years, despite prolonged high unemployment, as the expanding
service sectors are driving wage growth and economic activity. For much of
Continental Europe, rent levels and property prices are still below their
prior cycle's peak. In many cities, the supply of new space is physically or
economically constrained, vacancy rates remain low and demand appears to be
stable if not growing. Both the business cycle and real estate values appear
to have room to grow. London is a different story as rent levels and property
values were spurred by a strong economy with significant financial liquidity.
Rental levels and property values have already approached the prior cycle's
peak and now are in retreat as new supply and falling demand are already
evident. Scandinavian real estate markets can be fairly described as lying
between both the U.K. and Continental Europe in cyclical terms. Australia and
Canada have also enjoyed reasonably strong recoveries, albeit not quite to
prior peak levels. Concern over potential slowing of their export-oriented
economies have dimmed near term prospects for appreciation.
While a reading of both the business cycle and the real estate cycle are
fundamentally important to our investment program, these are not the only
factors we look at. Alpine's emphasis is on acquiring shares in companies at
either a significant discount to their underlying value or where significant
growth is underestimated by the stock market. The Fund's recent investments
in Southeast Asia, Canada and New Zealand fit the former criteria. We believe
our investments in both Spain and the U.S. fit the latter criteria.
Q. WHAT ARE THE PROSPECTS FOR INVESTING IN REAL ESTATE SECURITIES AROUND THE
WORLD OVER THE NEXT TWELVE MONTHS?
A. The most important factors influencing real estate performance, assuming
supply and demand equilibrium, are economic growth and financial liquidity.
Clearly, both will be limited during the first half of calendar 1999. Our
reading of economic forecasts leads us to project GDP growth rates of between
1% and 2% for both the U.S. and Europe over the course of the next year. We
believe Asian GDP will be flat to negative with similar economic prospects in
store for Latin America. Depending on the level of international economic
activity, 1% to 2% growth for Canada, Australia and New Zealand seems likely.
In our view, much of the growth will come in the second half of the year.
We believe most stock markets are currently pricing in prospects of
limited growth and, in some countries, negative growth during the early part
of 1999. Renewed economic growth and real estate strength in the second half
might surprise some stock investors. We expect to see property shares
moderately higher in both Europe and the U.S. Asian real estate has probably
seen its downward adjustment come to an end for most sectors in Hong Kong,
- --------------------------------------------------------------------------------
-6-
<PAGE> 7
Portfolio Manager's Report to Shareholders Alpine International Real Estate
Equity Fund
- --------------------------------------------------------------------------------
Singapore and the Philippines. However, recovery will take time. Continued
deterioration in Thailand, Malaysia, South Korea, Indonesia and China is
likely. Timing Japan's recovery remains a question mark. We anticipate that
Argentina and Australia will remain relatively stable, and we continue to be
positive on Canada and New Zealand where selective shares are undervalued.
Brazil and Venezuela will need time for their property markets to stabilize.
Q. ASIDE FROM UNDERVALUATION AND CYCLICAL RECOVERY, WHAT OTHER COMPELLING
REASONS ARE THERE FOR INVESTING IN REAL ESTATE STOCKS NOW?
A. It's worth noting that inflation, as measured by CPI, is generally below 2%
throughout much of the world despite the fact that most economies have
relatively high employment rates, due to the deflationary impact of weak
economies in Southeast Asia. Given our projection for modest economic growth
with low inflation and strong employment patterns, it is not surprising that
INTEREST RATES HAVE CONTINUED TO FALL TO LEVELS NOT SEEN FOR THIRTY YEARS! As
of October 31, the yields on 10-year government bonds in most major countries
were between 4.00% to 4.50%, with only Canada and Australia running higher at
4.86% and 4.75%, respectively. Japan at 1.26% was at the other end. The
positive yield curve in most countries suggests that monetary easing will
continue. For example, the positive spread between 1-year and 10-year
treasury bonds of 60 to 100 basis points, is consistent throughout Europe.
The lone exception with a negative yield curve is the U.K., although they've
subsequently begun to lower bank lending rates. As of October 31, the
interest rates in developed countries were at least 60 and typically, 100 to
200 basis points lower than they were one year ago.
In comparison with long term interest rates of 4.00% to 4.50% RELATIVE
INITIAL INVESTMENT YIELDS ON MOST COMMERCIAL REAL ESTATE INVESTMENTS HAVE NOT
BEEN THIS ATTRACTIVE FOR TWENTY TO THIRTY YEARS! Positive acquisition spreads
of 100 to 200 basis points on prime office and retail properties offer risk
premiums which more than compensate for today's more expensive capital.
Potential positive spreads of 300 to 500 basis points on secondary properties
are also unusually high. Such risk-adjusted returns may prove compelling
enough to lure increasing amounts of both entrepreneurial and institutional
capital to invest in property. Additional investment may drive valuations
higher if the prospect of economic stability also becomes more apparent
during the new year.
If capital does flow into real estate and values begin to rise, so
should the prices of real estate securities. However, if the share prices of
real estate securities remain relatively depressed, this could create a wave
of merger and acquisition activity, as entrepreneurs seek to capitalize on
potentially undervalued companies and assets.
Another appeal for real estate securities investors are the high
dividend yields derived from owning property. As of October 31, 1998 Alpine
Management & Research determined that Real Estate Investment Trusts (REITs)
had an aggregate average dividend yield of 7.8%, a rarely seen premium of 300
basis points over ten-year treasuries. Indeed, dividend yields on REITs range
from 4% to 12%, as do the yields of Australian Property Trusts and Canadian
REITs. Property shares in New Zealand yield between 5% and 10% while Hong
Kong real estate shares provide dividend yields of 3% to 10%. Other Asian
property shares offer lower dividend payout ratios and thus yield between 1%
and 3%, which even by Japanese standards is still attractive relative to a
1.86% yield on 10-year treasuries. Major European property shares currently
yield between 3% and 8% in Belgium, France, the Netherlands and England.
Historically, yields in Sweden and Germany are slightly lower, while in Spain
much more so.
- --------------------------------------------------------------------------------
-7-
<PAGE> 8
Portfolio Manager's Report to Shareholders Alpine International Real Estate
Equity Fund
- --------------------------------------------------------------------------------
Based on both my experience (dating back to 1985) and my analysis of
historical periods (back to the early 1970's) I believe we are entering a
unique period where both real estate yields and property share dividend
yields either match or often surpass the income from long-term government
securities. This unprecedented premium income yield relative to treasury
securities further enhances the appeal of real estate as an attractive
alternative vehicle for a broad spectrum of investors.
Given our world view that economic growth will remain positive for most
of the world's major economies, we believe there is a distinct possibility
that some of the countries currently experiencing recession may recover next
year, while the essential demand drivers for real estate should remain intact
in the U.S. and Europe. We appear to be at a favorable point in both the real
estate cycle and business cycle as many countries are benefiting from their
government's stimulative fiscal and monetary policies. When these factors are
combined with today's relatively low share prices and historically large
yield spreads for both real estate and real estate securities, it appears to
us at Alpine that this is an opportunistic time to invest in real estate
securities throughout the world. We will continue to draw upon our experience
and network of contacts to select the areas of greatest opportunity for both
the recovery of property prices and the growth of unseen values.
Sincerely,
/s/ Samuel A. Lieber
Samuel A. Lieber
Portfolio Manager
This report is authorized for distribution only when preceded or accompanied by
a Prospectus.
- --------------------------------------------------------------------------------
-8-
<PAGE> 9
REPORT OF INDEPENDENT ACCOUNTANTS
TO THE SHAREHOLDERS AND BOARD OF TRUSTEES OF
ALPINE EQUITY TRUST
In our opinion, the accompanying statement of assets and liabilities,
including the schedule of portfolio investments, and related statements of
operations, of changes in net assets and the financial highlights present
fairly, in all material respects, the financial position of the Alpine
International Real Estate Equity Fund of the Alpine Equity Trust at October 31,
1998, the results of its operations for the year then ended, the changes in its
net assets for the years presented and the financial highlights for each of the
periods presented, in conformity with generally accepted accounting principles.
These financial statements and financial highlights (hereafter referred to as
"financial statements") are the responsibility of the Alpine Equity Trust's
management; our responsibility is to express an opinion on these financial
statements based on our audits. We conducted our audits of these financial
statements in accordance with generally accepted auditing standards, which
require that we plan and perform the audit to obtain reasonable assurance about
whether the financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements, assessing the accounting principles
used and significant estimates made by management, and evaluating the overall
financial statement presentation. We believe that our audits, which included
confirmation of securities at October 31, 1998 by correspondence with the
custodian and brokers, provide a reasonable basis for the opinion expressed
above.
PricewaterhouseCoopers LLP
December 8, 1998
Columbus, Ohio
-9-
<PAGE> 10
ALPINE INTERNATIONAL REAL ESTATE EQUITY FUND
SCHEDULE OF PORTFOLIO INVESTMENTS
OCTOBER 31, 1998
<TABLE>
<CAPTION>
SECURITY MARKET
SHARES DESCRIPTION VALUE
- ---------- ------------------------------ -----------
<C> <S> <C>
COMMON STOCKS -- (97.3%)
Argentina -- (3.6%)
281,313 IRSA Inversiones y
Representaciones SA......... $ 723,190
21,268 IRSA Inversiones y
Representaciones SA, GDR.... 550,310
-----------
1,273,500
-----------
Canada -- (9.1%)
55,700 Bentall Corp.................. 504,085
91,500 Canadian Hotel Income
Properties REIT............. 482,057
24,697 Concord Pacific Group, Inc.
(b)......................... 11,175
983,000 Dundee Realty Corp. (b)....... 1,143,790
322,000 Gentra, Inc. (b).............. 551,597
1,124,500 Royop Properties Corp. (b).... 537,912
-----------
3,230,616
-----------
Denmark -- (2.5%)
10,156 Thorkild Kristensen A/S....... 903,339
-----------
Finland -- (0.9%)
50,000 Sponda Oyj (b)................ 332,447
-----------
France -- (11.6%)
20,000 Societe des Immeubles de
France...................... 1,662,805
33,078 Societe Du Louvre............. 2,470,340
-----------
4,133,145
-----------
Germany -- (2.1%)
29,871 Kampa-Haus AG................. 770,142
-----------
Hong Kong -- (6.1%)
270,000 Harbour Centre Development.... 140,302
420,000 Hongkong Land Holdings,
Ltd......................... 596,400
1,290,400 HKR International, Ltd........ 728,846
5,000,000 Midland Realty Holdings,
Ltd......................... 703,607
-----------
2,169,155
-----------
Japan -- (6.2%)
190,000 Diamond City Co., Ltd......... 652,212
22,000 Heiwa Real Estate Co., Ltd.... 67,967
146,410 Kansai Sekiwa Real Estate Co.,
Ltd......................... 464,887
4,400 Meiwa Estate (b).............. 41,536
46,000 Tachihi Enterprise Co.,
Ltd......................... 973,083
-----------
2,199,685
-----------
Mexico -- (1.4%)
70,000 Grupo Posadas SA, Class A
(b)......................... 26,278
1,315,000 Grupo Posadas SA, Class L
(b)......................... 480,652
-----------
506,930
-----------
</TABLE>
<TABLE>
<CAPTION>
SECURITY MARKET
SHARES DESCRIPTION VALUE
- ---------- ------------------------------ -----------
<C> <S> <C>
COMMON STOCKS, CONTINUED:
Netherlands -- (3.1%)
90,500 European City Estates N.V..... $ 1,104,795
-----------
New Zealand -- (1.7%)
2,854,145 Kiwi Development Trust........ 498,640
720,900 Trans Tasman Properties,
Ltd......................... 125,946
-----------
624,586
-----------
Norway -- (1.9%)
133,000 Choice Hotels Scandinavia
ASA......................... 173,196
39,200 Steen & Strom Invest ASA...... 505,154
-----------
678,350
-----------
Philippines -- (3.6%)
1,500,000 Ayala Corp.................... 381,052
1,901,000 Ayala Land, Inc............... 577,148
13,625,000 SM Development Corp........... 320,796
-----------
1,278,996
-----------
Singapore -- (5.4%)
415,000 DBS Land, Ltd................. 468,975
800,000 Marco Polo Developments,
Ltd......................... 761,563
300,000 Singapore Land, Ltd........... 696,461
-----------
1,926,999
-----------
Spain -- (9.9%)
50,355 Inmobilaria Ubris SA (b)...... 677,986
7,053 Melia Inversiones Americanas,
N.V. (b).................... 191,424
150,000 Prima Immobiliaria SA (b)..... 1,254,289
169,993 Sotogrande SA (b)............. 515,584
70,000 Vallehermoso SA............... 863,121
-----------
3,502,404
-----------
Sweden -- (2.1%)
83,900 Castellum AB.................. 740,591
-----------
Thailand -- (1.2%)
105,000 Central Pattana Public Co.,
Ltd. (b).................... 32,148
178,600 Dusit Thani Public Co., Ltd.
(b)......................... 155,541
400,000 Saha Pathana Inter-Holding
Public Co., Ltd. (b)........ 185,066
195,000 Sammakorn Public Co., Ltd.
(b)......................... 48,824
-----------
421,579
-----------
United Kingdom -- (3.6%)
350,000 Greycoat PLC.................. 805,950
1,200,000 Hemingway Properties PLC...... 497,387
-----------
1,303,337
-----------
</TABLE>
Continued
-10-
<PAGE> 11
ALPINE INTERNATIONAL REAL ESTATE EQUITY FUND
SCHEDULE OF PORTFOLIO INVESTMENTS
OCTOBER 31, 1998
<TABLE>
<CAPTION>
SECURITY MARKET
SHARES DESCRIPTION VALUE
- ---------- ------------------------------ -----------
<C> <S> <C>
COMMON STOCKS, CONTINUED:
United States -- (20.3%)
22,900 Alexander's, Inc. (b)......... $ 1,716,069
33,000 Crossmann Communities,
Inc. (b).................... 750,750
48,725 D.R. Horton, Inc.............. 773,509
30,000 FelCor Suite Hotels, Inc...... 706,875
15,000 Lennar Corp................... 303,750
50,000 MeriStar Hotels & Resorts,
Inc. (b).................... 118,750
3,000 Servico, Inc. (b)............. 14,625
92,100 Sunstone Hotel Investors,
Inc......................... 834,656
148,700 The Presley Companies (b)..... 74,350
6,400 Toll Brothers, Inc. (b)....... 148,400
55,000 U.S. Home Corp. (b)........... 1,739,375
-----------
7,181,109
-----------
6,900 Miscellaneous Securities
(1.0%)...................... 163,784
-----------
Total Common Stocks
(Cost $37,110,896).......... 34,445,489
-----------
</TABLE>
<TABLE>
<CAPTION>
SECURITY MARKET
SHARES DESCRIPTION VALUE
- ---------- ------------------------------ -----------
<C> <S> <C>
COMMON STOCKS, CONTINUED:
Total Investments
(Cost $37,110,896)
(a)................... 97.3% $34,445,489
Other assets in excess of
liabilities........... 2.7% 964,777
---- ----------
TOTAL NET ASSETS........100.0% $35,410,266
---- ----------
---- ----------
</TABLE>
- ---------
(a) Represents cost for financial reporting purposes and differs from cost basis
for federal income tax purposes by the amount of losses recognized for
financial reporting in excess of federal income tax reporting of $1,940.
Cost for federal income tax purposes differs from market value by net
unrealized depreciation of securities as follows:
<TABLE>
<S> <C>
Unrealized appreciation................... $ 6,196,959
Unrealized depreciation................... (8,864,306)
-----------
Net unrealized appreciation............... $(2,667,347)
===========
</TABLE>
(b) Non income producing security.
GDR -- Global Depository Receipts
REIT -- Real Estate Investment Trust
See notes to financial statements.
-11-
<PAGE> 12
ALPINE INTERNATIONAL REAL ESTATE EQUITY FUND
STATEMENT OF ASSETS AND LIABILITIES
OCTOBER 31, 1998
<TABLE>
<S> <C>
ASSETS:
Investments at value (identified cost, $37,110,896)....... $34,445,489
Receivable for investment securities sold................. 2,274,073
Receivable for capital shares issued...................... 356
Interest and dividends receivable......................... 69,587
Reclaim receivable........................................ 43,826
Prepaid expenses and other assets......................... 7,723
-----------
Total assets............................................ 36,841,054
-----------
LIABILITIES:
Cash overdrafts........................................... 6,573
Foreign currency overdrafts (Cost, $167,933).............. 172,797
Payable for investment securities purchased............... 1,149,315
Payable for capital shares redeemed....................... 2,445
Accrued expenses and other liabilities:
Investment advisory fees................................ 26,768
Administration fees..................................... 870
Distribution fees-B Class............................... 143
Distribution fees-C Class............................... 96
Shareholder servicing fees-A Class...................... 70
Shareholder servicing fees-B Class...................... 48
Shareholder servicing fees-C Class...................... 32
Custodian fees.......................................... 2,492
Legal fees.............................................. 10,973
Audit fees.............................................. 22,500
Transfer agent fees..................................... 4,275
Trustee fees............................................ 697
Printing fees........................................... 27,324
Other................................................... 3,370
-----------
Total liabilities....................................... 1,430,788
-----------
NET ASSETS.................................................. $35,410,266
===========
NET ASSETS REPRESENTED BY
Capital stock, at par value............................... $ 273
Additional paid-in-capital................................ 40,333,506
Undistributed (distributions in excess of) net investment
income.................................................. (147,129)
Accumulated undistributed net realized gains (losses) from
investment transactions................................. (2,108,820)
Unrealized appreciation (depreciation) from investments
and foreign currency transactions....................... (2,667,564)
-----------
TOTAL NET ASSETS........................................ $35,410,266
===========
NET ASSETS VALUE
Y Class shares
Net assets of $34,645,921 / 2,673,194 shares
outstanding............................................ $ 12.96
===========
A Class shares
Net assets of $363,499 / 28,177 shares outstanding...... $ 12.90
===========
Offering price (based on sales load of 4.75%)........... $ 13.54
===========
B Class shares*
Net assets of $246,009 / 19,568 shares outstanding...... $ 12.57
===========
C Class shares*
Net assets of $154,837 / 12,324 shares outstanding...... $ 12.56
===========
</TABLE>
* Redemption price per share varies based on length of time shares are held
(Note 5)
See notes to financial statements.
-12-
<PAGE> 13
ALPINE INTERNATIONAL REAL ESTATE EQUITY FUND
STATEMENT OF OPERATIONS
YEAR ENDED OCTOBER 31, 1998
<TABLE>
<S> <C> <C>
INVESTMENT INCOME:
Interest............................................................ $ 8,304
Dividends (net of foreign withholding taxes of $77,973)............. 683,306
----------
Total income..................................................... 691,610
----------
EXPENSES:
Investment advisory fees.................................. $379,071
Administration fees....................................... 43,587
Transfer agent fees....................................... 58,391
Distribution fees-B Class................................. 1,854
Distribution fees-C Class................................. 1,259
Shareholder Servicing Fee-A Class......................... 1,123
Shareholder Servicing Fee-B Class......................... 618
Shareholder Servicing Fee-C Class......................... 420
Custodian fees............................................ 45,856
Legal fees................................................ 9,664
Audit fees................................................ 28,261
Trustees' fees and expenses............................... 6,019
Registration and filing fees.............................. 63,969
Printing fees............................................. 24,448
Other..................................................... 16,459
--------
Net expenses.......................................................... 680,999
----------
Net Investment Income................................................. 10,611
----------
NET REALIZED AND UNREALIZED GAIN ON INVESTMENTS:
Net realized gains from investment transactions..................... 2,861,418
Net realized gains from foreign currency transactions............... 8,161
Net change in unrealized (depreciation) from investments............ (2,720,903)
Net change in unrealized appreciation from foreign currency......... 17,137
----------
Net realized/unrealized gains from investments........................ 165,813
----------
Change in net assets resulting from operations........................ $ 176,424
==========
</TABLE>
See notes to financial statements.
-13-
<PAGE> 14
ALPINE INTERNATIONAL REAL ESTATE EQUITY FUND
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
YEAR ENDED YEAR ENDED
OCTOBER 31, 1998 OCTOBER 31, 1997
---------------- ----------------
<S> <C> <C>
OPERATIONS:
Net investment income..................................... $ 10,611 $ (90,765)
Net realized gains from investment and foreign
transactions........................................... 2,869,579 1,941,129
Net change in unrealized appreciation (depreciation) from
investments and foreign currency transactions.......... (2,703,766) 302,113
----------- -----------
Change in net assets resulting from operations......... 176,424 2,152,477
----------- -----------
DISTRIBUTIONS TO SHAREHOLDERS:
From net investment income
A Class................................................ -- --
B Class................................................ -- --
C Class................................................ -- --
Y Class................................................ -- (76,344)
----------- -----------
Total distributions to shareholders.................... -- (76,344)
----------- -----------
SHARES OF BENEFICIAL INTEREST TRANSACTIONS:
Proceeds for shares sold.................................. 10,972,286 1,779,852
Payments for shares redeemed.............................. (11,629,044) (16,374,343)
Dividends reinvested...................................... -- 43,582
----------- -----------
Net (decrease) in net assets resulting from shares of
beneficial interest transactions..................... (656,758) (14,550,909)
----------- -----------
Total (decrease) in net assets......................... (480,334) (12,474,776)
----------- -----------
NET ASSETS:
Beginning of year......................................... 35,890,600 48,365,376
----------- -----------
End of year............................................... $35,410,266 $35,890,600
=========== ===========
Undistributed (accumulated distributions in excess of) net
investment income......................................... $ (147,129) $ (18,581)
=========== ===========
</TABLE>
See notes to financial statements.
-14-
<PAGE> 15
ALPINE INTERNATIONAL REAL ESTATE EQUITY FUND
(FORMERLY EVERGREEN GLOBAL REAL ESTATE EQUITY FUND)
NOTES TO FINANCIAL STATEMENTS
1. ORGANIZATION:
Alpine International Real Estate Equity Fund, formerly Evergreen Global
Real Estate Equity Fund, the ("Fund"), is registered under the Investment
Company Act of 1940, as amended (the "1940 Act"), as a diversified,
open-end management investment company. The Fund is a separate series of
the Alpine Equity Trust, formerly the Evergreen Equity Trust, a
Massachusetts business trust organized in 1988.
The Fund offers A Class, B Class, C Class and Y Class shares. A Class
shares are sold with a maximum front-end sales charge of 4.75%. B Class and
C Class shares are sold without a front-end sales charge, but pay higher
ongoing distribution fees than A Class. B Class shares are sold subject to
a contingent deferred sales charge that is payable upon redemption and
decreases depending on how long the shares have been held. C Class shares
are sold subject to a contingent deferred sales charge payable on shares
redeemed within one year after the month of purchase. B Class shares
purchased after January 1, 1997 will automatically convert to A Class
shares after seven years. B Class shares purchased prior to January 1, 1997
retain their existing conversion rights. Y Class shares are sold at net
asset value and are not subject to contingent deferred sales charges or
distribution fees. Y Class shares are sold only to certain institutional or
individual investors who do not receive services of financial
intermediaries that offer shares of the Fund.
2. SIGNIFICANT ACCOUNTING POLICIES:
The following is a summary of significant accounting policies consistently
followed by the Fund in the preparation of its financial statements. The
policies are in conformity with generally accepted accounting principles,
which require management to make estimates and assumptions that affect
amounts reported herein. Actual results could differ from these estimates.
A. VALUATION OF SECURITIES:
The Fund values securities traded on a national securities exchange or
included on the NASDAQ National Market System ("NASDAQ") at the last
reported sales price on the exchange where primarily traded. The Fund
values securities traded on an exchange or NASDAQ for which there has been
no sale and other securities traded in the over-the-counter market at the
mean between the last reported bid and asked price. Securities for which
market quotations are not available, including restricted securities, are
valued at fair value as determined in good faith according to procedures
approved by the Board of Trustees. Short-term investments with remaining
maturities of 60 days or less are carried at amortized cost, which
approximates market value.
B. REPURCHASE AGREEMENTS:
The Fund may invest in repurchase agreements. Securities pledged as
collateral for repurchase agreements are held by the custodian on the
Fund's behalf. The Fund monitors the adequacy of the collateral daily and
will require the seller to provide additional collateral in the event the
market value of the securities pledged falls below the carrying value of
the repurchase agreement, including accrued interest. The Fund will only
enter into repurchase agreements with banks and other financial
institutions which are deemed by the investment advisor to be creditworthy
pursuant to guidelines established by the Board of Trustees. Repurchase
agreements are considered to be loans under the 1940 act.
Continued
-15-
<PAGE> 16
ALPINE INTERNATIONAL REAL ESTATE EQUITY FUND
(FORMERLY EVERGREEN GLOBAL REAL ESTATE EQUITY FUND)
NOTES TO FINANCIAL STATEMENTS, CONTINUED
C. FOREIGN CURRENCY:
The books and records of the Fund are maintained in United States (U.S.)
dollars. Foreign currency amounts are translated into United States dollars
as follows: market value of investments, other assets and liabilities at
the daily rate of exchange; purchases and sales of investments, income and
expenses at the rate of exchange prevailing on the respective dates of such
transactions. Net unrealized foreign exchange gain (loss) resulting from
changes in foreign currency exchange rates is a component of net unrealized
appreciation (depreciation) on investments and foreign currency related
transactions. Net realized foreign currency gains and losses resulting from
changes in exchange rates include foreign currency gains and losses between
trade date and settlement date on investment securities transactions,
foreign currency related transactions and the difference between the
amounts of interest and dividends recorded on the books on the Fund and the
amounts that are actually received and are included in realized gain (loss)
on foreign currency related transactions. The portion of foreign currency
gains and losses related to fluctuations in exchange rates between the
initial purchase trade date and subsequent sale trade date is included in
realized gain (loss) on foreign currency related transactions.
D. SECURITY TRANSACTIONS AND INVESTMENT INCOME:
Securities transactions are accounted for no later than one business day
after the trade date. Realized gains and losses are computed on the
identified cost basis. Interest income is recorded on the accrual basis and
includes accretion of discounts and amortization of premiums. Dividend
income is recorded on the ex-dividend date or in the case of some foreign
securities, on the date thereafter when the Fund is made aware of the
dividend. Foreign income may be subject to foreign withholding taxes, which
are accrued as applicable. Capital gains realized on some foreign
securities are subject to foreign taxes and are accrued as applicable.
E. FEDERAL 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
timely, all of its net investment company income and net realized capital
gains to shareholders. Therefore, no federal income tax provision is
required. (Under the applicable foreign tax law, a withholding tax may be
imposed on interest, dividends and capital gains earned on foreign
investments at various rates. Where available, the Fund will file for
claims on foreign taxes withheld.)
F. DIVIDENDS AND DISTRIBUTIONS:
The Fund intends to distribute substantially all of its net investment
income and net realized capital gains, if any, annually in the form of
dividends. Distributions to shareholders are recorded at the close of
business on the ex-dividend date.
The amounts of dividends from net investment income and of distributions
from net realized gains are determined in accordance with federal income
tax regulations, which may differ from generally accepted accounting
principles. These "book/tax" differences are either considered temporary or
permanent in nature. To the extent these differences are permanent in
nature, such amounts are reclassified within the composition of net assets
based on their federal tax-basis treatment; temporary differences do not
require reclassification.
Continued
-16-
<PAGE> 17
ALPINE INTERNATIONAL REAL ESTATE EQUITY FUND
(FORMERLY EVERGREEN GLOBAL REAL ESTATE EQUITY FUND)
NOTES TO FINANCIAL STATEMENTS, CONTINUED
Dividends and distributions to shareholders which exceed net investment
income and net realized capital gains for financial reporting purposes but
not for tax purposes are reported as dividends in excess of net investment
income or distributions in excess of net realized gains. To the extent they
exceed net investment income and net realized gains for tax purposes, they
are reported as distributions of capital.
As of October 31, 1998, the following reclassification have been made to
increase (decrease) such accounts.
<TABLE>
<CAPTION>
ACCUMULATED
UNDISTRIBUTED
(DISTRIBUTIONS IN ACCUMULATED UNDISTRIBUTED NET
EXCESS OF) NET REALIZED GAINS (LOSSES)
INVESTMENT INCOME (LOSSES) FROM INVESTMENT TRANSACTIONS
-------------------------- -----------------------------
<S> <C> <C>
International Real Estate Equity
Fund.............................. $(139,159) $139,159
</TABLE>
G. CLASS ALLOCATIONS:
Income, expenses (other than class specific expenses) and realized and
unrealized gains and losses are prorated among the classes based on the
relative net assets of each class. Class specific expenses are allocated to
the class to which they relate. Currently, class specific expenses are
limited to expenses incurred under the Distribution Plans for each class.
Continued
-17-
<PAGE> 18
ALPINE INTERNATIONAL REAL ESTATE EQUITY FUND
(FORMERLY EVERGREEN GLOBAL REAL ESTATE EQUITY FUND)
NOTES TO FINANCIAL STATEMENTS, CONTINUED
3. CAPITAL SHARE TRANSACTIONS:
The Fund has an unlimited number of shares of beneficial interest, with
$0.0001 par value, authorized. Transactions in shares and dollars of the
Fund were as follows:
<TABLE>
<CAPTION>
YEAR ENDED YEAR ENDED
OCTOBER 31, 1998 OCTOBER 31, 1997
------------------------ --------------------------
SHARES AMOUNT SHARES AMOUNT
-------- ------------ ---------- ------------
<S> <C> <C> <C> <C>
A CLASS
Shares sold...................... 83,001 $ 1,177,240 40,811 $ 505,405
Shares redeemed.................. (80,825) (1,131,032) (73,533) (893,699)
-------- ------------ ---------- ------------
Net increase/decrease............ 2,176 46,208 (32,722) (388,294)
-------- ------------ ---------- ------------
B CLASS
Shares sold...................... 13,606 190,234 14,681 182,292
Shares redeemed.................. (10,848) (149,239) (8,946) (109,808)
-------- ------------ ---------- ------------
Net increase/decrease............ 2,758 40,995 5,735 72,484
-------- ------------ ---------- ------------
C CLASS
Shares sold...................... 17,119 232,674 8,782 109,223
Shares redeemed.................. (13,173) (171,623) (1,080) (13,742)
-------- ------------ ---------- ------------
Net increase/decrease............ 3,946 61,051 7,702 95,481
-------- ------------ ---------- ------------
Y CLASS
Shares sold...................... 683,226 9,372,138 79,254 982,932
Shares redeemed.................. (725,879) (10,177,150) (1,226,663) (15,357,094)
Shares issued in reinvestment of
distributions.................. -- -- 3,475 43,582
-------- ------------ ---------- ------------
Net increase/decrease............ (42,653) (805,012) (1,143,934) (14,330,580)
-------- ------------ ---------- ------------
Total Net increase/decrease...... (33,773) $ (656,758) (1,163,219) $(14,550,909)
-------- ------------ ---------- ------------
</TABLE>
4. SECURITIES TRANSACTIONS:
Cost of purchases and proceeds from sales of investment securities,
excluding securities sold short and short-term investments, were
$30,448,274 and $31,890,906, respectively, for the year ended October 31,
1998.
5. DISTRIBUTION PLANS:
BISYS Fund Services L.P. ("BISYS L.P."), a wholly-owned subsidiary of The
BISYS Group Inc. ("BISYS") serves as principal underwriter to the Fund.
Continued
-18-
<PAGE> 19
ALPINE INTERNATIONAL REAL ESTATE EQUITY FUND
(FORMERLY EVERGREEN GLOBAL REAL ESTATE EQUITY FUND)
NOTES TO FINANCIAL STATEMENTS, CONTINUED
The Fund has adopted Distribution Plans for each class of shares, except Y
Class shares, as allowed by Rule 12b-1 of the 1940 Act. Distribution plans
permit the Fund to reimburse its principal underwriter for costs related to
selling shares of the Fund and for various other services. These costs,
which consist primarily of commissions and service fees to broker-dealers
who sell shares of the Fund, are paid by the Fund. Pursuant to the
Distribution plans, each class, except Y Class, currently pays a service
fee equal to 0.25% of the average daily net assets of the class. B Class
and C Class also presently pay distribution fees equal to 0.75% of the
average daily net assets of the class. Distribution Plan fees are
calculated daily and paid monthly.
During the year ended October 31, 1998, amounts paid to BISYS L.P. and its
predecessor pursuant to the Fund's A Class, B Class and C Class
Distribution Plans were $1,123, $2,472 and $1,679, respectively.
Each of the Distribution Plans may be terminated at any time by vote of the
Independent Trustees or by vote of a majority of the outstanding voting
shares of the respective class.
A Class shares are subject to a 4.75% sales charge at the time of purchase.
B Class shares are subject to a Contingent Deferred Sales Charge (CDSC) on
redemptions of shares made within six years of purchase. The applicable
CDSC is equal to a percentage of the lesser of the net asset value per
share (NAV) at the date of the original purchase or at the date of
redemption, according to the following chart:
<TABLE>
<CAPTION>
YEAR OF REDEMPTION CDSC
------------------ ----
<S> <C>
First....................................................... 5%
Second...................................................... 4
Third....................................................... 3
Fourth...................................................... 3
Fifth....................................................... 2
Sixth....................................................... 1
</TABLE>
C Class shares are subject to a 1% CDSC on shares redeemed during the first
year after purchase.
6. INVESTMENT ADVISORY AGREEMENT AND OTHER AFFILIATED TRANSACTIONS:
Effective February 23, 1998, the Fund entered into an investment advisory
agreement with Alpine Management & Research LLC ("Alpine"). Alpine is a
newly formed Delaware limited liability company organized for the purpose
of providing investment advisory and management services to investment
companies and other advisory clients. Prior to February 23, 1998, Evergreen
Asset Management Corp. ("Evergreen Asset"), a wholly owned subsidiary of
First Union National Bank ("First Union"), served as investment advisor to
the Fund. Pursuant to each investment advisor's agreement with the Fund,
Alpine and Evergreen Asset were entitled to an annual fee based on the
Fund's average daily net assets, in accordance with the following schedule:
<TABLE>
<S> <C>
First $750 million.......................................... 1.00%
Next $250 million........................................... 0.90%
Over $1 billion............................................. 0.80%
</TABLE>
Continued
-19-
<PAGE> 20
ALPINE INTERNATIONAL REAL ESTATE EQUITY FUND
(FORMERLY EVERGREEN GLOBAL REAL ESTATE EQUITY FUND)
NOTES TO FINANCIAL STATEMENTS, CONTINUED
For the period from February 23, 1998 through October 31, 1998, Alpine was
paid $259,733 for its services. For the period November 1, 1997 through
February 22, 1998, Evergreen Asset was paid $119,338 for its services.
Evergreen Investment Services, Inc. ("EIS"), formerly Evergreen Keystone
Investment Services, Inc, a subsidiary of First Union, served as
administrator for the Fund and State Street Bank and Trust Company, served
as the transfer and dividend disbursing agent for the Fund from November 1,
1997 to April 27, 1998. Effective April 27, 1998, BISYS Fund Services L.P.
("BISYS L.P.") became the Fund's Principal Underwriter and Distributor.
BISYS Fund Services Ohio, Inc. became the Fund's Administrator and BISYS
Fund Services, Inc. ("BISYS") became the Fund's Fund Accountant, Transfer
Agent and Dividend Disbursing Agent. In addition, effective April 27, 1998,
Investors Fiduciary Trust Company ("IFTC") became the Fund's custodian. In
return for these serves, BISYS L.P. and BISYS will earn an annual fee
amounting to 0.23% of the Fund's average daily net assets and IFTC will
earn an annual fee amounting to 0.095% of the Fund's average daily net
assets. The Distribution fees incurred by the Fund under its Distribution
Plans will not be affected by the change in service provider.
Prior to February 23, 1998, Lieber & Company, an affiliate of First Union,
was the investment sub-advisor to the Fund and also provided brokerage
services with respect to substantially all security transactions of the
Fund effected on the New York or American Stock Exchanges. For the period
November 1, 1997 through February 22, 1998, the Fund incurred $ 30,035 in
brokerage commissions with Lieber & Company. Lieber & Company was
reimbursed by Evergreen Asset, at no additional expense to the Fund, for
its cost of providing investment advisory services.
Officers of the Fund and affiliated Trustees receive no compensation
directly from the Fund.
7. EXPENSE OFFSET ARRANGEMENT:
The Fund has entered into an expense offset arrangement with its custodian.
The assets deposited with the custodian under this expense offset
arrangement could have been invested in income-producing assets.
8. CONCENTRATION OF CREDIT RISK:
The Fund invests a substantial portion of its assets in the equity
securities of issuers engaged in the real estate industry, including real
estate investment trusts (REITs). As a result, the Fund may be more
affected by economic developments in the real estate industry than would a
general equity fund.
9. SPECIAL MEETING OF SHAREHOLDERS (UNAUDITED):
A special meeting of shareholders of the Fund was held on February 23, 1998
to consider a number of proposals. On January 12, 1998, the record date for
the meeting, the Fund had 2,808,677 shares outstanding, of which 1,863,557
were represented at the meeting. The votes recorded at the meeting, by
proposal, were as follows:
Continued
-20-
<PAGE> 21
ALPINE INTERNATIONAL REAL ESTATE EQUITY FUND
(FORMERLY EVERGREEN GLOBAL REAL ESTATE EQUITY FUND)
NOTES TO FINANCIAL STATEMENTS, CONTINUED
PROPOSAL 1 -- APPROVAL OF A NEW INVESTMENT ADVISORY AGREEMENT BETWEEN THE FUND
AND ALPINE MANAGEMENT & RESEARCH LLC:
<TABLE>
<S> <C>
Voted "For"................................................. 1,818,899
Voted "Against"............................................. 32,475
Voted "Abstain"............................................. 12,183
</TABLE>
PROPOSAL 2 -- ELECTION OF TRUSTEES:
<TABLE>
<CAPTION>
VOTED VOTED VOTED
"FOR" "AGAINST" "ABSTAINED"
--------- ----------- -------------
<S> <C> <C> <C>
Laurence B. Ashkin............................ 1,838,919 18,403 6,235
Foster Bam.................................... 1,837,927 19,395 6,235
Samuel A Lieber............................... 1,840,137 17,185 6,235
H. Guy Leibler................................ 1,838,969 18,353 6,235
</TABLE>
PROPOSAL 3 -- CHANGES IN INVESTMENT POLICIES AND RESTRICTIONS:
<TABLE>
<S> <C>
Proposal 3.B.(1) -- Concentration of investments
Voted "For"............................................ 1,804,475
Voted "Against"........................................ 44,951
Voted "Abstain"........................................ 14,131
Proposal 3.B.(2) -- Borrowings
Voted "For"............................................ 1,804,526
Voted "Against"........................................ 44,900
Voted "Abstain"........................................ 14,131
Proposal 3.B.(3) -- Pledging Assets
Voted "For"............................................ 1,804,059
Voted "Against"........................................ 45,367
Voted "Abstain"........................................ 14,131
Proposal 3.B.(4) -- Short Sales
Voted "For"............................................ 1,804,747
Voted "Against"........................................ 44,679
Voted "Abstain"........................................ 14,131
Proposal 3.B.(5) -- Loans
Voted "For"............................................ 1,804,475
Voted "Against"........................................ 44,951
Voted "Abstain"........................................ 14,131
Proposal 3.B.(6) -- Investment in securities of Non-U.S.
issuers
Voted "For"............................................ 1,804,747
Voted "Against"........................................ 44,679
Voted "Abstain"........................................ 14,131
</TABLE>
Continued
-21-
<PAGE> 22
ALPINE INTERNATIONAL REAL ESTATE EQUITY FUND
(FORMERLY EVERGREEN GLOBAL REAL ESTATE EQUITY FUND)
NOTES TO FINANCIAL STATEMENTS, CONTINUED
<TABLE>
<S> <C>
Proposal 3.B.(7) -- Options
Voted "For"............................................ 1,804,747
Voted "Against"........................................ 44,679
Voted "Abstain"........................................ 14,131
Proposal 3.B.(8) -- Restriction on diversification of
investments
Voted "For"............................................ 1,804,747
Voted "Against"........................................ 44,679
Voted "Abstain"........................................ 14,131
Proposal 3.B.(9) -- Investments in securities of unseasoned
issuers
Voted "For"............................................ 1,804,747
Voted "Against"........................................ 44,679
Voted "Abstain"........................................ 14,131
Proposal 3.B.(10) -- Restriction limiting the purchase of
warrants
Voted "For"............................................ 1,804,747
Voted "Against"........................................ 44,679
Voted "Abstain"........................................ 14,131
Proposal 3.B.(11) -- Restriction on purchase of securities
of related parties entities
Voted "For"............................................ 1,804,747
Voted "Against"........................................ 44,679
Voted "Abstain"........................................ 14,131
Proposal 3.B.(12) -- Commodities
Voted "For"............................................ 1,804,398
Voted "Against"........................................ 45,028
Voted "Abstain"........................................ 14,131
</TABLE>
10. FEDERAL INCOME TAX INFORMATION (UNAUDITED):
CAPITAL LOSS CARRYFORWARD
At October 31, 1998, the Fund had net capital loss carryforwards in the
amount of $2,106,880 which will be available through October 31, 2003, to
offset future net capital gains, if any, to the extent provided by the
Treasury regulations. To the extent that these carryforwards are used to
offset future capital gains, it is probable that the gains so offset will
not be distributed to shareholders.
Continued
-22-
<PAGE> 23
ALPINE INTERNATIONAL REAL ESTATE EQUITY FUND
FINANCIAL HIGHLIGHTS
(FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD)
<TABLE>
<CAPTION>
PERIOD ENDED
YEAR ENDED OCTOBER 31, SEPTEMBER 30,
------------------------------------------- --------------
1998 1997(a) 1996(a) 1995(a)(b) 1995(a)(c)
------- ------- ------- ---------- --------------
<S> <C> <C> <C> <C> <C>
A CLASS SHARES
NET ASSET VALUE BEGINNING OF YEAR.... $ 12.94 $12.28 $11.58 $12.12 $11.46
------- ------ ------ ------ ------
INCOME (LOSS) FROM INVESTMENT
OPERATIONS:
Net investment income (loss)....... (0.05) (0.06) 0.06 (0.01) 0.07
Net realized and unrealized gain
(loss) from investments......... 0.01 0.72 0.64 (0.53) 0.59
------- ------ ------ ------ ------
Total from investment operations... (0.04) 0.66 0.70 (0.54) 0.66
------- ------ ------ ------ ------
NET ASSET VALUE END OF YEAR.......... $ 12.90 $12.94 $12.28 $11.58 $12.12
------- ------ ------ ------ ------
TOTAL RETURN (EXCLUDES SALES
CHARGES)........................... (0.31)% 5.40% 6.00% (4.50)%(g) 5.80%(g)
ANNUALIZED RATIOS / SUPPLEMENTARY
DATA:
Net assets at end of period
(000)........................... $ 363 $ 336 $ 721 $ 74 $ 66
Ratio of expenses to average net
assets.......................... 2.04% 2.10% 1.79% 1.73%(f) 1.61%(f)
Ratio of interest expense to
average net assets.............. N/A 0.03% 0.03% 0.03%(f) 0.01%(f)
Ratio of net investment income
(loss) to average net assets.... (0.26)% (0.47)% 0.40% (1.26)%(f) 0.98%(f)
Ratio of expenses to average net
assets(d)....................... 2.04% 2.19% 2.97% 46.90%(f) 21.59%(f)
Ratio of expenses to average net
assets(e)....................... N/A 2.10% N/A N/A N/A
Portfolio Turnover(h).............. 82% 44% 25% 1% 28%
</TABLE>
- ---------
<TABLE>
<S> <C>
(a) Net investment income is based on average shares outstanding during the period.
(b) The Fund changed its year end from September 30 to October 31, effective October 31, 1995.
(c) For the period from February 10, 1995 (commencement of class operations) to September 30, 1995.
(d) During the period, certain fees were waived or reimbursed. If such fees waived or reimbursed had not
occurred, the ratios would have been as indicated.
(e) During the period, certain fees were indirectly paid. If such fees indirectly paid had not occurred, the
ratios would have been as indicated.
(f) Annualized.
(g) Not annualized.
(h) Portfolio turnover is calculated on the basis of the Fund, as a whole, without distinguishing between
the classes of shares issued.
</TABLE>
See notes to financial statements.
-23-
<PAGE> 24
ALPINE INTERNATIONAL REAL ESTATE EQUITY FUND
FINANCIAL HIGHLIGHTS
(FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD)
<TABLE>
<CAPTION>
PERIOD ENDED
YEAR ENDED OCTOBER 31, SEPTEMBER 30,
------------------------------------------- --------------
1998 1997(a) 1996(a) 1995(a)(b) 1995(a)(c)
------- ------- ------- ---------- --------------
<S> <C> <C> <C> <C> <C>
B CLASS SHARES
NET ASSET VALUE BEGINNING OF YEAR.... $ 12.69 $12.14 $11.53 $12.08 $11.44
------- ------ ------ ------ ------
INCOME (LOSS) FROM INVESTMENT
OPERATIONS:
Net investment income (loss)....... (0.10) (0.15) (0.13) (0.02) 0.08
Net realized and unrealized gain
(loss) from investments......... (0.02) 0.70 0.74 (0.53) 0.56
------- ------ ------ ------ ------
Total from investment operations... (0.12) 0.55 0.61 (0.55) 0.64
------- ------ ------ ------ ------
NET ASSET VALUE END OF YEAR.......... $ 12.57 $12.69 $12.14 $11.53 $12.08
------- ------ ------ ------ ------
TOTAL RETURN (EXCLUDES SALES
CHARGES)........................... (0.95)% 4.50% 5.30% (4.60)%(g) 5.60%(g)
ANNUALIZED RATIOS / SUPPLEMENTARY
DATA:
Net assets at end of period
(000)........................... $ 246 $ 213 $ 134 $ 100 $ 128
Ratio of expenses to average net
assets.......................... 2.80% 2.82% 2.56% 2.44%(f) 2.42%(f)
Ratio of interest expense to
average net assets.............. N/A 0.03% 0.03% 0.03%(f) 0.03%(f)
Ratio of net investment income
(loss) to average net assets.... (0.95)% (1.23)% (1.03)% (1.98)%(f) (1.38)%(f)
Ratio of expenses to average net
assets(d)....................... 2.80% 2.90% 14.45% 31.39%(f) 82.74%(f)
Ratio of expenses to average net
assets(e)....................... N/A 2.81% N/A N/A N/A
Portfolio Turnover(h).............. 82% 44% 25% 1% 28%
</TABLE>
- ---------
<TABLE>
<S> <C>
(a) Net investment income is based on average shares outstanding during the period.
(b) The Fund changed its year end from September 30 to October 31, effective October 31, 1995.
(c) For the period from February 8, 1995 (commencement of class operations) to September 30, 1995.
(d) During the period, certain fees were waived or reimbursed. If such fees waived or reimbursed had not
occurred, the ratios would have been as indicated.
(e) During the period, certain fees were indirectly paid. If such fees indirectly paid had not occurred, the
ratios would have been as indicated.
(f) Annualized.
(g) Not annualized.
(h) Portfolio turnover is calculated on the basis of the Fund, as a whole, without distinguishing between
the classes of shares issued.
</TABLE>
See notes to financial statements.
-24-
<PAGE> 25
ALPINE INTERNATIONAL REAL ESTATE EQUITY FUND
FINANCIAL HIGHLIGHTS
(FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD)
<TABLE>
<CAPTION>
PERIOD ENDED
YEAR ENDED OCTOBER 31, SEPTEMBER 30,
------------------------------------------- --------------
1998 1997(a) 1996(a) 1995(a)(b) 1995(a)(c)
------- ------- ------- ---------- --------------
<S> <C> <C> <C> <C> <C>
C CLASS SHARES
NET ASSET VALUE BEGINNING OF YEAR... $ 12.70 $12.14 $ 11.53 $12.08 $11.43
------- ------ ------- ------ ------
INCOME (LOSS) FROM INVESTMENT
OPERATIONS:
Net investment income (loss)...... (0.08) (0.14) (0.13) (0.02) 0.06
Net realized and unrealized gain
(loss) from investments........ (0.06) 0.70 0.74 (0.53) 0.59
------- ------ ------- ------ ------
Total from investment
operations..................... (0.14) 0.56 0.61 (0.55) 0.65
------- ------ ------- ------ ------
NET ASSET VALUE END OF YEAR......... $ 12.56 $12.70 $ 12.14 $11.53 $12.08
------- ------ ------- ------ ------
TOTAL RETURN (EXCLUDES SALES
CHARGES).......................... (1.10)% 4.60% 5.30% (4.60)%(g) 5.70%(g)
ANNUALIZED RATIOS / SUPPLEMENTARY
DATA:
Net assets at end of period
(000).......................... $ 155 $ 106 $ 8 $ 4 $ 7
Ratio of expenses to average net
assets......................... 2.83% 2.83% 2.54% 2.37%(f) 1.54%(f)
Ratio of interest expense to
average net assets............. N/A 0.03% 0.03% 0.02%(f) 0.01%(f)
Ratio of net investment income
(loss) to average net assets... (0.82)% (1.15)% (1.06)% (1.94)%(f) 0.86%(f)
Ratio of expenses to average net
assets(d)...................... 2.83% 2.91% 118.64% 570.26%(f) 269.60%(f)
Ratio of expenses to average net
assets(e)...................... N/A 2.83% N/A N/A N/A
Portfolio Turnover(h)............. 82% 44% 25% 1% 28%
</TABLE>
- ---------
<TABLE>
<S> <C>
(a) Net investment income is based on average shares outstanding during the period.
(b) The Fund changed its year end from September 30 to October 31, effective October 31, 1995.
(c) For the period from February 9, 1995 (commencement of class operations) to September 30, 1995.
(d) During the period, certain fees were waived or reimbursed. If such fees waived or reimbursed had not
occurred, the ratios would have been as indicated.
(e) During the period, certain fees were indirectly paid. If such fees indirectly paid had not occurred, the
ratios would have been as indicated.
(f) Annualized.
(g) Not annualized.
(h) Portfolio turnover is calculated on the basis of the Fund, as a whole, without distinguishing between
the classes of shares issued.
</TABLE>
See notes to financial statements.
-25-
<PAGE> 26
ALPINE INTERNATIONAL REAL ESTATE EQUITY FUND
FINANCIAL HIGHLIGHTS
(FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD)
<TABLE>
<CAPTION>
YEAR ENDED YEAR ENDED
YEAR ENDED OCTOBER 31, SEPTEMBER 30, SEPTEMBER 30,
---------------------------------------- ------------- -------------
1998 1997(a) 1996(a) 1995(a)(b) 1995(a) 1994(a)(c)
------- ------- ------- ---------- ------------- -------------
<S> <C> <C> <C> <C> <C> <C>
Y CLASS SHARES
NET ASSET VALUE
BEGINNING OF YEAR.................... $ 12.97 $ 12.31 $ 11.59 $ 12.13 $ 13.81 $ 14.75
------- ------- ------- ------- ------- --------
INCOME (LOSS) FROM INVESTMENT
OPERATIONS:
Net investment income (loss)......... 0.01 (0.03) 0.01 (0.01) 0.11 0.07
Net realized and unrealized gain
(loss) from investments............ (0.02) 0.71 0.71 (0.53) (1.17) (1.01)
------- ------- ------- ------- ------- --------
Total from investment operations..... (0.01) 0.68 0.72 (0.54) (1.06) (0.94)
------- ------- ------- ------- ------- --------
LESS DISTRIBUTIONS
From net investment income........... -- (0.02) -- -- (0.10) --
From net realized gain from
investments........................ -- -- -- -- (0.52) --
------- ------- ------- ------- ------- --------
Total distributions.................. -- (0.02) -- -- (0.62) --
------- ------- ------- ------- ------- --------
NET ASSET VALUE END OF YEAR............ $ 12.96 $ 12.97 $ 12.31 $ 11.59 $ 12.13 $ 13.81
------- ------- ------- ------- ------- --------
TOTAL RETURN........................... (0.08)% 5.50% 6.20% (4.50)% (7.70)% (6.40)%
ANNUALIZED RATIOS / SUPPLEMENTARY DATA:
Net Assets at end of period (000)...... $34,646 $35,234 $47,502 $61,418 $67,645 $132,294
Ratio of expenses to average net
assets............................... 1.78% 1.82% 1.62% 1.62% 1.54% 1.46%(f)
Ratio of interest expense to average
net assets........................... N/A 0.03% 0.03% 0.03% 0.05% 0.08%(f)
Ratio of net investment income (loss)
to average net assets................ 0.04% (0.21)% 0.11% (1.14)% 0.92% 0.56%(f)
Ratio of expenses to average net assets
(d).................................. 1.78% 1.90% 1.67% N/A N/A N/A
Ratio of expenses to average net assets
(e).................................. N/A 1.82% N/A N/A N/A N/A
Portfolio Turnover(h).................. 82% 44% 25% 1% 28% 63%
</TABLE>
- ---------
<TABLE>
<S> <C>
(a) Net investment income is based on average shares outstanding during the period.
(b) The Fund changed its year end from September 30 to October 31, effective October 31, 1995.
(c) The Fund changed its year end from December 31 to September 30, effective September 30, 1994.
(d) During the period, certain fees were waived or reimbursed. If such fees waived or reimbursed had not
occurred, the ratios would have been as indicated.
(e) During the period, certain fees were indirectly paid. If such fees indirectly paid had not occurred, the
ratios would have been as indicated.
(f) Annualized.
(g) Not annualized.
(h) Portfolio turnover is calculated on the basis of the Fund, as a whole, without distinguishing between
the classes of shares issued.
</TABLE>
See notes to financial statements.
-26-
<PAGE> 27
TRUSTEES
Samuel A. Lieber
Laurence B. Ashkin
Foster Bam
H. Guy Leibler
INVESTMENT ADVISER
Alpine Management and Research, LLC
122 East 42nd Street, 37th floor
New York, NY 10168
CUSTODIAN
IFTC
801 Pennsylvania
Kansas City, MO 64105
TRANSFER AGENT
BISYS Fund Services, Inc.
3435 Stelzer Road
Columbus, OH 43219
ACCOUNTANTS
PricewaterhouseCoopers LLP
100 East Broad Street
Columbus, OH 43215
LEGAL COUNSEL
Schulte Roth & Zabel LLP
900 Third Avenue
New York, NY 10022
ADMINISTRATOR AND DISTRIBUTOR
BISYS Fund Services L.P.
3435 Stelzer Road
Columbus, OH 43219
[Alpine Logo]
International
Real Estate
Equity
Fund
_____________________________
Annual Report
October 31, 1998
Alpine International Real Estate Equity Fund
122 East 42nd Street, 37th floor
New York, NY 10168
(12/98) (212) 687-5588
