<PAGE> 1
TABLE OF CONTENTS
Portfolio Manager's Report to Shareholders
PAGE 2
Report of Independent Accountants
PAGE 7
Schedule of Portfolio Investments
PAGE 8
Statement of Assets and Liabilities
PAGE 9
Statement of Operations
PAGE 10
Statements of Changes in Net Assets
PAGE 11
Notes to Financial Statements
PAGE 12
Financial Highlights
PAGE 18
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-1-
<PAGE> 2
Portfolio Manager's Report to Shareholders Alpine U.S. Real Estate Equity Fund
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
ALPINE U.S. REAL ESTATE WILSHIRE REAL ESTATE LIPPER REAL ESTATE FUND
CLASS Y SHARES SECURITIES INDEX AVERAGE
----------------------- -------------------- -----------------------
<S> <C> <C> <C>
'9/3/93' 10000 10000 10000
'9/30/93' 10350 10455 10438
'3/31/94' 10901 9924 9899
'9/30/94' 10117 9890 9622
'3/31/95' 9674 9902 9274
'9/30/95' 11900 10823 10312
'3/31/96' 13085 11685 10922
'9/30/96' 13515 12962 11849
'3/31/97' 16229 15627 13841
'9/30/97' 24151 18410 16088
'3/31/98' 25876 18245 16448
'9/30/98' 18189 15326 13815
'3/31/99' 17446 14654 13275
'9/30/99' 16298 14662 13512
</TABLE>
Past performance is not predictive of future results. Investment return and
principal value of the Alpine U.S. 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 fees. Without the
waiver of fees, total return would have been lower.
The Wilshire Real Estate Securities Index is a market capitalization weighted
performance index of listed property and real estate securities.
The Lipper Real Estate Fund Average is an average of funds that invest 65% of
their portfolio in equity securities of domestic and foreign companies engaged
in the real estate industry.
The Wilshire and Lipper index are unmanaged and do not reflect the deduction of
fees associated with a mutual fund, such as investment adviser fees. The
performance for the Alpine U.S. Real Estate Equity Fund reflects the deduction
of fees for these value-added services.
<TABLE>
<CAPTION>
COMPARATIVE TOTAL RETURNS AS OF 09/30/99
5 SINCE
1 YEAR 3 YEAR YEAR+ INCEPTION+
<S> <C> <C> <C> <C>
- ------------------------------------------------------------------------------------
Alpine Class Y (10.40)% 6.44% 10.01% 8.37%
Alpine Class A (4.75%)* (14.87)% 4.50% 7.29% 7.28%
Alpine Class B (5.00%)** (15.60)% 4.63% 7.97% 7.57%
Alpine Class C (1.00%)** (12.16)% 5.40% 8.34% 7.63%
- ------------------------------------------------------------------------------------
Wilshire Real Estate Securities Index (4.33)% 4.19% 8.19% 6.49%
Lipper Real Estate Fund Average (2.23)% 4.46% 8.62% 5.23%
</TABLE>
* Represents maximum front-end sales load.
** Represents contingent deferred sales charge.
+ Performance of Class A, Class B and Class C shares for the period prior to
their inceptions on 3/10/95, 3/7/95 and 7/12/95, respectively, represents
performance for Class Y shares, which commenced operations on 9/3/93. Class A,
Class B and Class C shares are subject to distribution and service fees, which
had they been included in the prior period, performance would have been lower.
- --------------------------------------------------------------------------------
-2-
<PAGE> 3
Portfolio Manager's Report to Shareholders Alpine U.S. Real Estate Equity Fund
- --------------------------------------------------------------------------------
Dear Shareholder:
We are pleased to present the Alpine U.S. Real Estate Equity Fund's 1999 Annual
Report to shareholders. Over the twelve months ended September 30, 1999 the net
asset value of Class Y shares of the Alpine U.S. Real Estate Equity Fund
declined by 11.23%, from $12.47 to $11.07. In comparison the Wilshire Real
Estate Securities Index(1) lost 4.33%. Real estate stocks are typically
classified as small capitalization in size, so they often correlate closely with
the Russell 2000 Index(2). However, over the past twelve months the usual
pattern did not hold as this Index gained 19.15%. The recent trend of large
stock outperformance continued as the S&P 500 Index(3) rose by 27.79% for the
same period.
I am foregoing our usual question and answer format for this report because
I wish to better convey my impressions of the curious disconnect between the
poor performance of real estate stocks during the past two years and the broadly
positive fundamentals of the direct property market. The downward slide in share
prices contrasts with strong occupancy rates and rising office rents in many
major cities, higher retail sales which have enhanced rents in better shopping
centers, and home sales volumes and prices at or near record levels. Real estate
stocks now trade at the cheapest valuations since the "Gulf War" recession of
1990/1991, when property owners experienced the greatest collapse in rents and
values in the post-depression era.
The last time I saw such a disparity between share prices and underlying
fundamentals was after "Black Monday" in October 1987. Once again, I feel like a
kid in a candystore! Unfortunately in finding ourselves in this "candystore",
real estate investors have had to endure significant underperformance for two
years. Even though the S&P 500 beat Real Estate Investment Trusts (REITs) in
four of the last five years, the past decade is a draw at five for each. In
fact, over the near twenty-eight year history of the NAREIT Equity Total Return
Index(4), REITs outperformed the S&P 500 in fifteen of those twenty-eight years.
It is also worth noting that the S&P Homebuilder Index(5) has bested both REITs
and the S&P 500 in three of the last five years and six times over the past
decade. For those who might expect a reversion to the mean with time, this
should make investors optimistic about the prospective relative returns and
diversification potential of real estate stocks. This is especially relevant
since the longest prior period of negative REIT returns lasted twenty-three
months during the recession of 1973-1974.(6)
For a perspective on current valuations let us start with the historic
average dividend yield since 1975 of 7.68% for Equity REITs tracked by NAREIT.
Currently, Alpine Management computes the weighted and unweighted average
dividend yields for the 135 equity REITs we follow to be 8.51% and 9.16%
respectively. Since the restructuring of the REIT industry in 1974-1975, this
ensuing period has included two significant recessions and three real estate
cycles during which 10-year Government Bond yields averaged 8.58%. As of
September 30,
(1)The Wilshire Real Estate Securities Index is a market capitalization
weighted performance index of listed property and real estate securities.
(2)The Russell 2000 Index is comprised of the smallest 2000 companies in the
Russell 3000 Index, representing approximately 8% of the Russell 3000 total
market capitalization.
(3)The Standard & Poor's 500 Index is a capitalization-weighted index of 500
stocks. The index is designed to measure performance of the broad domestic
economy through changes in the aggregate market value of 500 stocks
representing all major industries.
(4)The National Association of Real Estate Investment Trusts is a total return
performance index of all equity REITS tracked by NAREIT.
(5)The Standard & Poor's Homebuilding Index is a capitalization-weighted index
of all stocks designed to measure the performance of the homebuilding sector
of the Standard & Poor's 500 Index.
(6)Performance data obtained from Bloomberg.
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-3-
<PAGE> 4
Portfolio Manager's Report to Shareholders Alpine U.S. Real Estate Equity Fund
- --------------------------------------------------------------------------------
GEOGRAPHICAL DISTRIBUTION*
GEO DIST PIE
<TABLE>
<CAPTION>
<S> <C>
South East 17
Mountain States 8
Pacific Southwest 27
New England 6
Central Plains 4
South 15
Midwest 8
Mid Atlantic 12
Pacific Northwest 3
</TABLE>
SECTOR DISTRIBUTION*
SECTOR DIST PIE
<TABLE>
<CAPTION>
<S> <C>
Lodging 35
Home Building 24
Office 7
Retail 16
Operating Cos. 4
Land 2
Apartments 4
HealthCare 8
</TABLE>
1999, 10-year bonds yielded 5.88%. Historically, the dividend yield from REITs
has been a bit less than the interest rate of 10-year treasury bonds, yet today
the opposite is true. Clearly the yield premium from REIT dividends is near
record levels. Even the interest premium or spread between REIT dividend yields
and the yields of both the S&P 500 Index and S&P Utility Index are currently
very high.
As with REITs, homebuilder's stock valuations, relative to most traditional
measures are at historic low levels. Aggregate price-to-earnings (P/E) ratios
for homebuilders relative to the S&P 500 have dropped from 65% of the broad
market P/E to less than 20%. Thus at a P/E 30.5x earnings for the S&P 500, the
S&P Homebuilder Index P/E ratio would traditionally equate to a 20x multiple
(65% of 30.5x), but today's earnings are priced at a 5.5x multiple or 18% of the
S&P ratio. Alpine's analysis of the 15 builders with the largest current market
capitalizations reveals the average P/E multiple was 12.1x earnings for the past
five years, and 14.8x for ten years.
Curiously, these low share valuations for real estate stocks are occurring
during a period of strong real estate fundamentals. Existing home sales this
year have hit record levels for both volume and price, while new home sales are
the best since the 1980's. Meanwhile, the inventory of available new and
existing homes is very low, and large order backlogs provide visibility of
strong earnings into next year. In other sectors, hotel rooms can be hard to get
on short notice in major cities during the working week. Although revenue growth
on a per room basis has slowed to between 2 to 4% for most chains, only poorly
located, low-end hotels are suffering falling revenues due to some excess
development. Nonetheless, lodging companies are trading for 5 to 8 times
earnings before interest, taxes, depreciation and amortization, and Hotel REITs
yield 9 to 14%. Apartments are achieving 2 to 5% rent increases in most markets
in spite of steady new construction, yet this traditionally stable sector's
shares still trade at an average multiple of 8x projected 2000 funds from
operations per share and yield 8.5% on average. Office property prospects vary
widely depending on
- --------------------------------------------------------------------------------
-4-
<PAGE> 5
Portfolio Manager's Report to Shareholders Alpine U.S. Real Estate Equity Fund
- --------------------------------------------------------------------------------
type (downtown or suburban), the location and age of the buildings among other
factors, so generalizations are less useful, but rents are still rising in many
cities and occupancies remain stable. Shopping mall REITs have lost 14% of their
price on average over the past nine months despite strong retail sales volumes
and high levels of consumer confidence. Half of these mall companies now trade
below their initial public offering prices of two to five years ago because of
concern over the potential impact of E-commerce. As a benchmark, mail order
catalog sales have typically been below 10% of total retail store sales. Though
we think the potential for Internet sales is probably greater than catalogs, its
impact on well located real estate appears to be overestimated.
The common theme of the downward valuation pressure on real estate stocks
stems in part from the extended duration of this business cycle; that is, the
market is already pricing in the end of the cycle. In ignoring solid current
business fundamentals, the market appears to need additional confirmation to be
sure that a cyclical downturn is not near before most investors will again buy
these stocks. Unfortunately, the growth premium being paid by this market in
terms of high price valuations does not allow for uncertainty of business
prospects over the next few years. Technical factors, such as increasing inflows
to Index Funds (few real estate related stocks are in the S&P 500) and the
market's desire for liquidity are also limiting interest in the group. Finally,
tax loss selling is currently putting pressure on prices.
From our experience, extreme valuations eventually fade, or burst, and the
market's focus often rotates to lagging sectors. Such a natural progression
could soon occur for these stocks. Given current valuations, the prospect for
more mergers and acquisitions is strong. During this past fiscal year, the Fund
benefited from two take over bids -- Execustay Corp. was acquired by Marriott
International in the spring and Sunstone Hotel Investors, Inc. has negotiated a
management buyout that will soon be complete. We believe these takeover deals
show that cheap values are already attracting serious investors.
Over the past twelve months, the portfolio has been changed as we have
sought to concentrate on the best values. This does not mean the cheapest
companies, but the best companies at large discounts to underlying real estate
values. More than thirty positions have been sold while nine new holdings were
started, and a number of existing investments have been increased. Alpine
estimates that the fund's investments at current prices provide a discount of
30% to 50% below realizable values. The largest portfolio change by sector was
the reduction in Office REITs from 12.5% to 4.2% and the increase in Shopping
Centers from 4.1% to 8.1%. While Hotel REITs remain steady at 14.8%, over half
of that total is in Sunstone Hotel Investors, Inc. which has effectively become
an arbitrage investment. A new sector of investment for the Fund are Health Care
TOP 10 HOLDINGS*
<TABLE>
<C> <S> <C> <C> <C> <C>
1. Sunstone Hotel Investors, Inc. 7.8% 6. Meristar Hotels & Resorts 5.4%
2. Standard Pacific Corp. 6.9% 7. Lennar Corp. 5.3%
3. Homestead Village Inc. 6.9% 8. Felcor Lodging Trust, Inc. 4.7%
4. Excel Legacy Corp. 5.7% 9. Toll Brothers, Inc. 4.6%
5. Alexander's, Inc. 5.4% 10. CareMatrix Corp. 3.6%
* Portfolio composition subject to change.
</TABLE>
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-5-
<PAGE> 6
Portfolio Manager's Report to Shareholders Alpine U.S. Real Estate Equity Fund
- --------------------------------------------------------------------------------
Facilities, with a focus on operators of assisted living communities.
Overdevelopment has hit these companies hard as growth funds have been dumping
shares when earnings fall short. Alpine Management has bought shares at levels
that range from 40% to 80% below these companies' peak share prices. Even at
these prices, which are well below Alpine Management's estimate of property
replacement cost, we appear to have bought a bit early. We believe that these
prices will soon appear cheap if we are correct in anticipating mergers and
acquisitions (M&A) activity in this group.
Underlying our conclusion that real estate stocks are cheap, is our view
that the economy will remain stable, if not robust, for the next few years.
Essentially, real estate is near equilibrium which suggests only moderate rent
growth. In 2000, sectors which require regular capital expenditure such as
offices, malls, and hotels, and even apartments may be slightly less profitable.
Industrial, storage and neighborhood shopping centers should remain cash cows.
Urban locations along both coasts and selectively through the Sunbelt should be
favored. Home sales will likely decline by 5 to 7%, but major builders should be
able to increase market share and grow earnings. Overall, rents and prices
should continue to grow at a moderate pace in most regions. Thus, corporate
operating cash flow should grow between 4% to 8% for most companies.
Certainly the current valuation disparities between companies expected to
produce superior growth and companies which are cyclically constrained, have
pushed share prices beyond historic trading ranges to extremes of either wildly
expensive or absurdly cheap. Past experience suggests that a catalyst will
eventually shock the market out of this current pattern, albeit probably with
some serious price dislocations. Since cyclical stocks are already pricing in a
recession, even though one has yet to materialize, they should have reduced
downside risk in any major correction. Alternatively, a gradual market
realignment might occur if a continuation of the "goldilocks economy" renews
interest in perceived cyclically sensitive industries like real estate.
The equity markets will likely continue to emphasize investing for growth
over value, but we think there will be less of a separation than in the past few
years. The increased potential for M&A activity will influence the pattern which
has already begun in 1999. In closing, I wish to remind shareholders that this
Fund had its best year in 1997, when fourteen of its holdings were acquired. In
part, that stemmed from our long standing investment emphasis on value and
stockpicking, not index mimicry. Thus, given current valuations and the
potential for a number of stimulative catalysts, we are optimistic about the
prospects for this portfolio. Thank you for your continued interest and support.
Sincerely,
/s/ Samuel A. Lieber
Samuel A. Lieber
CEO/Portfolio Manager
The Alpine U.S. Real Estate Equity Fund is distributed by BISYS Fund Services.
For more complete information on the U.S. Real Estate Equity Fund, including
fees, expenses and sales charges please call 1-888-785-5578 for a free
prospectus. Please read the prospectus carefully before investing or sending
money.
The views expressed in this report reflect those of the investment adviser only
through the end of the period of the report as stated on the cover. The
manager's views are subject to change at any time based on the market and other
condition.
- --------------------------------------------------------------------------------
-6-
<PAGE> 7
Portfolio Manager's Report to Shareholders Alpine U.S. Real Estate Equity Fund
- --------------------------------------------------------------------------------
REPORT OF INDEPENDENT ACCOUNTANTS
To the Shareholders and Trustees
Alpine Equity Trust
In our opinion, the accompanying statement of assets and liabilities, including
the schedule of portfolio investments, and the related statements of operations
and of changes in net assets and the financial highlights present fairly, in all
material respects, the financial position of the Alpine U.S. Real Estate Equity
Fund of the Alpine Equity Trust (hereafter referred to as the "Fund") at
September 30, 1999, and the results of its operations for the year then ended,
the changes in its net assets 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 Fund's management; our
responsibility is to express an opinion on these financial statements based on
our audit. We conducted our audit 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 audit, which includes confirmation of securities at
September 30, 1999 by correspondence with the custodian and brokers, provides a
reasonable basis for the opinion expressed above.
PricewaterhouseCoopers LLP
Columbus, Ohio
November 19, 1999
- --------------------------------------------------------------------------------
-7-
<PAGE> 8
ALPINE U.S. EQUITY REAL ESTATE FUND
SCHEDULE OF PORTFOLIO INVESTMENTS
SEPTEMBER 30, 1999
<TABLE>
<CAPTION>
SECURITY MARKET
SHARES DESCRIPTION VALUE
- ---------- ------------------------------ -----------
<C> <S> <C>
REAL ESTATE INVESTMENT TRUSTS -- (32.5%)
Hotels -- (14.8%)
65,000 Felcor Lodging Trust, Inc..... $ 1,137,500
44,200 RFS Hotel Investors, Inc...... 508,300
216,200 Sunstone Hotel Investors,
Inc......................... 1,891,749
-----------
3,537,549
-----------
Shopping Centers -- (8.1%)
18,200 Alexander's, Inc. (b)......... 1,316,087
20,150 Chelsea GCA Realty, Inc....... 637,244
-----------
1,953,331
-----------
Office-Industrial Buildings -- (4.2%)
29,500 Kilroy Realty Corp............ 623,188
48,000 Mission West Properties....... 396,000
-----------
1,019,188
-----------
Mixed Use -- (2.7%)
76,800 Meditrust Co.................. 652,800
-----------
Manufactured Home Parks -- (2.7%)
48,280 Asset Investor Corp........... 642,728
-----------
Total Real Estate Investment Trusts
(Cost $9,130,790)............. 7,805,596
-----------
COMMON STOCKS -- (65%)
Homebuilders -- (24.1%)
48,000 Crossmann Communities, Inc.
(b)......................... 783,000
81,060 Lennar Corp. (c).............. 1,291,894
13,500 Palm Harbor Homes, Inc. (b)... 185,625
29,900 Ryland Group, Inc............. 680,225
163,000 Standard Pacific Corp......... 1,670,750
58,300 Toll Brothers, Inc. (b)....... 1,111,344
1,000 U.S. Home Corp. (b)........... 27,813
-----------
5,750,651
-----------
Lodging -- (18.8%)
591,300 Homestead Village Properties,
Inc. (b).................... 1,663,031
89,000 John Q. Hammons Hotels, Inc.
(b)......................... 356,000
441,700 MeriStar Hotels & Resorts,
Inc. (b).................... 1,297,494
22,000 Starwood Hotels & Resorts
Worldwide, Inc.............. 490,875
</TABLE>
<TABLE>
<CAPTION>
SECURITY MARKET
SHARES DESCRIPTION VALUE
- ---------- ------------------------------ -----------
<C> <S> <C>
COMMON STOCKS, CONTINUED:
Lodging, continued:
44,000 Sunterra Corp. (b)............ $ 522,500
15,000 Trammell Crow Co. (b)......... 198,750
-----------
4,528,650
-----------
Real Estate Operating Companies -- (16.3%)
19,000 California Coastal
Communities, Inc. (b)....... 147,250
40,200 Capital Trust (b)............. 198,488
162,400 Crescent Operating, Inc.
(b)......................... 664,825
330,900 Excel Legacy Corp. (b)........ 1,385,643
53,400 Grubb & Ellis Co. (b)......... 307,050
30,200 LNR Property Corp............. 615,325
62,800 Wellsford Real Properties,
Inc. (b).................... 596,600
-----------
3,915,181
-----------
Health Care Facilities -- (5.0%)
37,500 Alterra Healthcare Corp.
(b)......................... 332,813
168,250 Carematrix Corp. (b).......... 872,796
-----------
1,205,609
-----------
Other -- (2.4%)
45,000 Sonic Automotive, Inc. (b).... 585,000
-----------
Total Common Stocks
(Cost $20,457,755)............ 15,985,091
-----------
MISCELLANEOUS SECURITIES -- (0.1%)
55,778 (Cost $328,553)............... 234,167
-----------
Total Investments
(Cost $29,917,098) (a) 100.1% 24,024,854
-----------
Liabilities in excess of other
assets................. (0.1)% (26,878)
. ---- -----------
TOTAL NET ASSETS........ 100.0% $23,997,976
---- -----------
---- -----------
</TABLE>
<TABLE>
<CAPTION>
MARKET
SHARES VALUE
- ---------- -----------
<C> <S> <C>
SECURITIES SOLD SHORT -- (1.9%)
12,500 Starwood Financial Trust...... $ 349,219
-----------
Total Securities Sold Short
(Proceeds $627,948)........... $ 349,219
===========
</TABLE>
- ---------------
(a) Represents cost for financial reporting purposes and differs from cost basis
for federal income tax purpose by amount of losses recognized for financial
reporting purposes in excess of federal income tax reporting of $766,517.
Cost for federal income tax purposes differs from value by net unrealized
(depreciation) as follows:
<TABLE>
<S> <C>
Unrealized appreciation................... $ 979,531
Unrealized depreciation................... (7,359,563)
-----------
Net unrealized depreciation............... $(6,380,032)
===========
</TABLE>
(b) Non income producing security.
(c) Part of the security is held as collateral for short sales.
See notes to financial statements.
- --------------------------------------------------------------------------------
-8-
<PAGE> 9
ALPINE U.S. REAL ESTATE EQUITY FUND
STATEMENT OF ASSETS AND LIABILITIES
SEPTEMBER 30, 1999
<TABLE>
<S> <C>
ASSETS:
Investments, at value (Cost $28,855,516).................. $23,288,541
Deposits with broker and custodian bank for securities
sold short (Cost $1,061,582)............................ 736,313
-----------
24,024,854
Interest and dividends receivable......................... 45,097
Receivable for capital shares issued...................... 2,000
Receivable for investment securities sold short........... 627,948
Receivable for investment securities sold................. 2,435,283
Prepaid expenses and other assets......................... 11,357
-----------
Total assets............................................ 27,146,539
-----------
LIABILITIES:
Securities sold short (proceeds $627,948)................. 349,219
Cash overdrafts........................................... 2,583,688
Payable for capital shares redeemed....................... 99,596
Accrued expenses and other liabilities:
Investment advisory fees................................ 21,394
Administration fees..................................... 604
Distribution fees....................................... 4,344
Other................................................... 89,718
-----------
Total liabilities....................................... 3,148,563
-----------
NET ASSETS.................................................. $23,997,976
===========
NET ASSETS REPRESENTED BY
Capital stock, at par value............................... $ 219
Additional paid-in-capital................................ 33,999,039
Distributions in excess of net investment income.......... 0
Distributions in excess of net realized gains from
investment transactions................................. (4,387,937)
Net unrealized depreciation from foreign exchange
transactions, short sales and investments............... (5,613,345)
-----------
TOTAL NET ASSETS........................................ $23,997,976
===========
NET ASSETS VALUE
Class A shares
Net assets of $2,200,070 / 201,378 shares outstanding... $ 10.93
===========
Offering price (based on sales charge of 4.75%)......... $ 11.48
===========
Class B shares*
Net assets of $3,094,550 / 290,524 shares outstanding... $ 10.65
===========
Class C shares*
Net assets of $1,298,775 / 122,004 shares outstanding... $ 10.65
===========
Class Y shares
Net assets of $17,404,581 / 1,572,373 shares
outstanding............................................ $ 11.07
===========
</TABLE>
- ---------------
* Redemption price per share varies based on length of time shares are held
(Note 5)
See notes to financial statements.
-9-
<PAGE> 10
ALPINE U.S. REAL ESTATE EQUITY FUND
STATEMENT OF OPERATIONS
YEAR ENDED SEPTEMBER 30, 1999
<TABLE>
<S> <C> <C>
INVESTMENT INCOME:
Dividends (net of foreign withholding taxes of $6,161).............. $ 862,226
-----------
Total income..................................................... 862,226
-----------
EXPENSES:
Investment advisory fees.................................. $339,537
Administration fees....................................... 78,094
Distribution fees -- Class B.............................. 36,118
Distribution fees -- Class C.............................. 12,628
Shareholder Servicing Fee -- Class A...................... 10,173
Shareholder Servicing Fee -- Class B...................... 12,039
Shareholder Servicing Fee -- Class C...................... 4,209
Custodian fees............................................ 246,127
Fund accounting fees...................................... 378
Legal fees................................................ 71,691
Registration and filing fees.............................. 50,847
Transfer agent fees....................................... 6,933
Trustees' fees............................................ 9,220
Other..................................................... 97,162
--------
Total expenses......................................... 975,156
--------
Net Investment Loss................................................... (112,930)
-----------
NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Net realized losses from foreign exchange and investment
transactions..................................................... (3,946,405)
Net change in unrealized depreciation from foreign exchange
transactions, short sales and investments........................ 1,399,873
-----------
Net realized/unrealized losses from investments....................... (2,546,532)
-----------
Change in net assets resulting from operations........................ $(2,659,462)
===========
</TABLE>
See notes to financial statements.
-10-
<PAGE> 11
ALPINE U.S. REAL ESTATE EQUITY FUND
STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
YEAR ENDED YEAR ENDED
SEPTEMBER 30, 1999 SEPTEMBER 30, 1998
------------------ ------------------
<S> <C> <C>
OPERATIONS:
Net investment income (loss).............................. $ (112,930) $ 172,407
Net realized gains (losses) from foreign exchange and
investment transactions................................ (3,946,405) 692,757
Net change in unrealized appreciation (depreciation) from
foreign exchange transactions, short sales and
investments............................................ 1,399,873 (13,160,995)
----------- ------------
Change in net assets resulting from operations............ (2,659,462) (12,295,831)
----------- ------------
DISTRIBUTIONS TO SHAREHOLDERS:
From net investment income
Class A................................................ (72) (33,856)
Class B................................................ -- (32,220)
Class C................................................ -- (13,786)
Class Y................................................ -- (151,695)
From realized gains on investments
Class A................................................ -- (645,169)
Class B................................................ -- (785,584)
Class C................................................ -- (336,121)
Class Y................................................ -- (2,702,405)
In excess of realized gains on investments
Class A................................................ (45,681) --
Class B................................................ (50,514) --
Class C................................................ (16,152) --
Class Y................................................ (208,945) --
Tax return of capital
Class A................................................ (6,501) --
Class B................................................ (7,197) --
Class C................................................ (2,298) --
Class Y................................................ (29,953) --
----------- ------------
Total distribution to shareholders..................... (367,313) (4,700,836)
----------- ------------
SHARES OF BENEFICIAL INTEREST TRANSACTIONS:
Proceeds from shares sold................................. 6,689,349 46,870,986
Payments from shares redeemed............................. (19,766,365) (21,835,045)
Dividends reinvested...................................... 329,632 4,376,852
----------- ------------
Change in net assets resulting from shares of
beneficial interest transactions..................... (12,747,384) 29,412,793
----------- ------------
Change in net assets................................... (15,774,159) 12,416,126
----------- ------------
NET ASSETS:
Beginning of period....................................... 39,772,135 27,356,009
----------- ------------
End of period............................................. $23,997,976 $ 39,772,135
=========== ============
</TABLE>
See notes to financial statements.
-11-
<PAGE> 12
ALPINE U.S. REAL ESTATE EQUITY FUND
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 1999
1. ORGANIZATION:
Alpine U.S. 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, a Massachusetts business trust organized
in 1988.
The Fund offers Class A, Class B, Class C and Class Y shares. Class A
shares are sold with a maximum front-end sales charge of 4.75%. Class B and
Class C shares are sold without a front-end sales charge, but pay higher
ongoing distribution fees than Class A. Class B 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. Class C shares
are sold subject to a contingent deferred sales charge payable on shares
redeemed within one year after the month of purchase. Class B shares
purchased after January 1, 1997 will automatically convert to Class A
shares after seven years. Class B shares purchased prior to January 1, 1997
retain their existing conversion rights. Class Y shares are sold at net
asset value and are not subject to contingent deferred sales charges or
distribution fees. Class Y 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
-12-
<PAGE> 13
ALPINE U.S. REAL ESTATE EQUITY FUND
NOTES TO FINANCIAL STATEMENTS, CONTINUED
SEPTEMBER 30, 1999
C. 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.
D. SHORT SALE TRANSACTIONS:
Short sales are transactions in which the Fund sells a security it does not
own, in anticipation of a decline in the market value of that security. To
complete such a transaction, the Fund must borrow the security to deliver
to the buyer upon the short sale; the Fund then is obligated to replace the
security borrowed by purchasing it in the open market at some later date.
The Fund will incur a loss if the market price of the security increases
between the date of the short sale and the date on which the Fund replaces
the borrowed security. The Fund will realize a gain if the security
declines in value between those dates. All short sales must be fully
collateralized. The Fund maintains the collateral in a segregated account
with its custodian, consisting of cash, equities and/or U.S. Government
securities sufficient to collateralize its obligation on the short
positions. At September 30, 1999, the value of securities sold short
amounted to $349,219, against which collateral of $736,313 was held.
For financial statement purposes, an amount equal to the settlement amount
is included in the Statement of Assets and Liabilities as an asset and an
equivalent liability. The amount of the liability is subsequently
marked-to-market to reflect the current value of the short position.
Securities sold short at September 30, 1999, and their related market
values and proceeds are set forth in the schedule of portfolio investments.
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.
Continued
-13-
<PAGE> 14
ALPINE U.S. REAL ESTATE EQUITY FUND
NOTES TO FINANCIAL STATEMENTS, CONTINUED
SEPTEMBER 30, 1999
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.
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 returns of capital.
As of September 30, 1999, the following reclassifications have been made to
increase (decrease) such accounts with offsetting adjustments made to
additional paid-in-capital:
<TABLE>
<CAPTION>
ACCUMULATED UNDISTRIBUTED ACCUMULATED UNDISTRIBUTED
(DISTRIBUTIONS IN EXCESS OF) NET REALIZED GAINS
NET INVESTMENT (LOSSES) FROM INVESTMENT
INCOME (LOSSES) TRANSACTIONS
---------------------------- -------------------------
<S> <C> <C>
U.S. Real Estate Equity................... $32,346 $38,772
</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.
H. FOREIGN EXCHANGE TRANSACTIONS:
The Fund may invest up to 15% of the value of its total assets in foreign
securities. The books and records of the Fund are maintained in U.S.
dollars. Non-U.S. denominated amounts are translated into U.S. dollars as
follows, with the resultant exchange gains and losses recorded in the
Statement of Operations:
i) market value of investment securities and other assets and
liabilities at the exchange rate on the valuation date,
ii) purchases and sales of investment securities, income and expenses
at the exchange rate prevailing on the respective date of such
transactions.
Dividends and interest from non-U.S. sources received by the Fund are
generally subject to non-U.S. withholding taxes at rates ranging up to 30%.
Such withholding taxes may be reduced or eliminated under the terms of
applicable U.S. income tax treaties, and the Fund intends to undertake any
procedural steps required to claim the benefits of such treaties.
Continued
-14-
<PAGE> 15
ALPINE U.S. REAL ESTATE EQUITY FUND
NOTES TO FINANCIAL STATEMENTS, CONTINUED
SEPTEMBER 30, 1999
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
SEPTEMBER 30, 1999 SEPTEMBER 30, 1998
-------------------------- ------------------------
SHARES AMOUNT SHARES AMOUNT
---------- ------------ --------- -----------
<S> <C> <C> <C> <C>
CLASS A
Shares sold...................... 51,927 $ 633,527 804,558 $13,656,844
Shares redeemed.................. (306,363) (3,785,541) (535,972) (8,757,392)
Shares issued in reinvestment of
dividends..................... 3,603 44,996 40,006 636,489
---------- ------------ --------- -----------
Net change....................... (250,833) (3,107,018) 308,592 5,535,941
---------- ------------ --------- -----------
CLASS B
Shares sold...................... 12,316 145,539 489,790 8,252,330
Shares redeemed.................. (249,576) (3,069,937) (193,555) (3,096,673)
Shares issued in reinvestment of
dividends..................... 3,863 47,319 47,696 749,779
---------- ------------ --------- -----------
Net change....................... (233,397) (2,877,079) 343,931 5,905,436
---------- ------------ --------- -----------
CLASS C
Shares sold...................... 74,205 909,809 243,416 4,143,415
Shares redeemed.................. (118,685) (1,452,165) (185,069) (3,079,800)
Shares issued in reinvestment of
dividends..................... 988 12,100 19,734 310,020
---------- ------------ --------- -----------
Net change....................... (43,492) (530,256) 78,081 1,373,635
---------- ------------ --------- -----------
CLASS Y
Shares sold...................... 394,300 5,000,465 1,325,466 20,817,418
Shares redeemed.................. (910,641) (11,458,713) (420,021) (6,900,201)
Shares issued in reinvestment of
dividends..................... 17,823 225,217 167,013 2,680,564
---------- ------------ --------- -----------
Net change....................... (498,518) (6,233,031) 1,072,458 16,597,781
---------- ------------ --------- -----------
Total net change................. (1,026,240) $(12,747,384) 1,803,062 $29,412,793
---------- ------------ --------- -----------
</TABLE>
4. SECURITIES TRANSACTIONS
Cost of purchases and proceeds from sales of investment securities,
excluding securities sold short and short-term investments, were
$27,089,929 and $39,505,035, respectively, for the fiscal year ended
September 30, 1999.
5. DISTRIBUTION PLANS
BISYS Fund Services L.P. ("BISYS L.P."), a wholly-owned subsidiary of The
BISYS Group Inc. serves as principal underwriter to the Fund.
Continued
-15-
<PAGE> 16
ALPINE U.S. REAL ESTATE EQUITY FUND
NOTES TO FINANCIAL STATEMENTS, CONTINUED
SEPTEMBER 30, 1999
The Fund has adopted Distribution Plans for each class of shares, except
Class Y 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 Class Y, currently pays a
service fee equal to 0.25% of the average daily net assets of the class.
Class B and Class C 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 fiscal year ended September 30, 1999, amounts earned by BISYS
L.P. and its predecessor pursuant to the Fund's Class A, Class B and Class
C Distribution Plans were $10,173, $48,157 and $16,837, 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.
Class A shares are subject to a 4.75% sales charge at the time of purchase.
Class B 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 within one year
after the month of purchase.
6. INVESTMENT ADVISORY AGREEMENT AND OTHER AFFILIATED TRANSACTIONS
Investment advisory services are provided to the Fund by Alpine Management
& Research LLC ("Alpine"). Pursuant to the investment advisor's agreement
with the Fund, Alpine is 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>
For the period from October 1,1998 through September 30,1999, Alpine earned
$339,537 for its services.
BISYS L.P. is the Fund's principal underwriter and Distributor. BISYS Fund
Services Ohio, Inc. is the Fund's Administrator and BISYS Fund Services,
Inc. ("BISYS") is the Fund's Fund Accountant, Transfer
Continued
-16-
<PAGE> 17
ALPINE U.S. REAL ESTATE EQUITY FUND
NOTES TO FINANCIAL STATEMENTS, CONTINUED
SEPTEMBER 30, 1999
Agent and Dividend Disbursing Agent. In addition, Investors Fiduciary Trust
Company ("IFTC") is the Fund's Custodian. In return for these services,
BISYS L.P and BISYS will earn an annual fee amounting to 0.23% of the
Fund's average daily net assets. As of July 1, 1999 this changed to the
greater of an annual fee amounting to 0.23% of the Fund's average daily net
assets or $250,000 annually for the Alpine Equity Trust. IFTC will earn an
annual fee amounting to 0.095% of the Fund's average daily net assets.
Officers of the Fund and affiliated Trustees receive no compensation
directly from the Fund.
7. 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.
8. OTHER FEDERAL INCOME TAX INFORMATION (UNAUDITED)
As of September 30, 1999 the following Funds have net capital loss
carryforwards which will be available through the stated years to offset
future net capital gains, if any, to the extent provided by the applicable
regulations. To the extent that this carryforward is used to offset future
capital gains, it is probable that the gains so offset will not be
distributed to shareholders:
<TABLE>
<CAPTION>
AMOUNT EXPIRES
-------- --------
<S> <C> <C>
U.S. Real Estate Equity................ 180,229 2007
</TABLE>
Under current tax law, capital losses realized after October 31 of a Fund's
fiscal year may be deferred and treated as occurring on the first day of
the next fiscal year. As of September 30, 1999 the following funds have
elected to defer such losses:
<TABLE>
<CAPTION>
POST-OCTOBER
CAPITAL LOSSES
--------------
<S> <C>
U.S. Real Estate Equity....................... $3,417,903
</TABLE>
During the fiscal year ended September 30, 1999 the following Funds
declared long term capital gain distributions as follows:
<TABLE>
<CAPTION>
20%
--------------
<S> <C>
U.S. Real Estate Equity....................... $133,329
</TABLE>
For corporate shareholders the following percentage of the total ordinary
income distributions paid during the fiscal year ended September 30, 1999
qualify for the corporate dividend received deduction for the following
funds:
<TABLE>
<S> <C>
U.S. Real Estate Equity......................... 5.26%
</TABLE>
Continued
-17-
<PAGE> 18
ALPINE U.S. REAL ESTATE EQUITY FUND
FINANCIAL HIGHLIGHTS
(FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD)
<TABLE>
<CAPTION>
YEAR ENDED SEPTEMBER 30,
-----------------------------------------------------------
1999(a) 1998(a) 1997(a) 1996(a) 1995(b)
------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C>
CLASS A SHARES
NET ASSET VALUE BEGINNING OF YEAR.................... $12.34 $19.34 $12.49 $11.42 $ 9.21
------ ------ ------ ------ ------
INCOME (LOSS) FROM INVESTMENT OPERATIONS
Net investment income (loss)....................... (0.01) 0.08 0.12(d) 0.20 0.18
Net realized and unrealized gain (loss) foreign
exchange transactions, short sales and
investments...................................... (1.28) (4.25) 8.57 1.28 2.03
------ ------ ------ ------ ------
Total from investment operations................... (1.29) (4.17) 8.69 1.48 2.21
------ ------ ------ ------ ------
LESS DISTRIBUTIONS
Net investment income.............................. --(c) (0.15) (0.26)(d) (0.20) --
Net realized gains from investments................ -- (2.68) (1.58) (0.21) --
In excess of net realized gains from investments... (0.11) -- -- -- --
Tax return of capital.............................. (0.01) -- -- -- --
------ ------ ------ ------ ------
Total distributions................................ (0.12) (2.83) (1.84) (0.41) --
------ ------ ------ ------ ------
NET ASSET VALUE END OF YEAR.......................... $10.93 $12.34 $19.34 $12.49 $11.42
====== ====== ====== ====== ======
TOTAL RETURN (EXCLUDES SALES CHARGE)................. (10.59)% (24.86)% 78.28% 13.12% 24.00%
ANNUALIZED RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000).................... $2,200 $5,582 $2,778 $ 263 $ 5
Ratio of expenses to average net assets.............. 2.82% 1.95% 1.77% 1.72% 1.78%(g)
Ratio of interest expense to average net assets...... N/A N/A N/A 0.04% N/A
Ratio of net investment income (loss) to average net
assets............................................. (0.05)% 0.27% 0.90% 1.60% 3.13%(g)
Ratio of expenses to average net assets (e).......... N/A N/A 1.76% N/A N/A
Ratio of expenses to average net assets (f).......... 2.82% 1.97% 2.49% 9.65% 364.74%(g)
Portfolio Turnover (h)............................... 77% 138% 205% 169% 115%
</TABLE>
- ---------
<TABLE>
<S> <C>
(a) Net investment income is based on average shares outstanding
during the period.
(b) For the period from March 10, 1995 (commencement of Class
operations) to September 30, 1995.
(c) Distribution per share was less than $0.005.
(d) The per share amount of net investment income is not in
accord with the distributions per share from net investment
income due to the timing of sales of Fund shares after the
Fund declared its annual income distribution on December 26,
1996. The distributions declared on such date were paid
principally from net investment income earned during the
previous fiscal year.
(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) During the period, certain fees were waived or reimbursed.
If such fees were not waived or reimbursed, the ratios would
have been as indicated.
(g) Annualized
(h) Portfolio turnover is calculated on the basis of the Fund,
as a whole, without distinguishing between the classes of
shares issued.
</TABLE>
-18-
<PAGE> 19
ALPINE U.S. REAL ESTATE EQUITY FUND
FINANCIAL HIGHLIGHTS
(FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD)
<TABLE>
<CAPTION>
YEAR ENDED SEPTEMBER 30,
-----------------------------------------------------------
1999(a) 1998(a) 1997(a) 1996(a) 1995(b)
------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C>
CLASS B SHARES
NET ASSET VALUE BEGINNING OF YEAR.................... $12.12 $19.14 $12.41 $11.37 $ 9.19
------ ------ ------ ------ ------
INCOME (LOSS) FROM INVESTMENT OPERATIONS
Net investment income (loss)....................... (0.12) (0.05) 0.02(c) 0.13 0.05
Net realized and unrealized gain (loss) foreign
exchange transactions, short sales and
investments...................................... (1.23) (4.18) 8.49 1.27 2.13
------ ------ ------ ------ ------
Total from investment operations............ (1.35) (4.23) 8.51 1.40 2.18
------ ------ ------ ------ ------
LESS DISTRIBUTIONS
Net investment income.............................. -- (0.11) (0.20)(c) (0.15) --
Net realized gains from investments................ -- (2.68) (1.58) (0.21) --
In excess of net realized gains from investments... (0.11) -- -- -- --
Tax return of capital.............................. (0.01) -- -- -- --
------ ------ ------ ------ ------
Total distributions................................ (0.12) (2.79) (1.78) (0.36) --
------ ------ ------ ------ ------
NET ASSET VALUE END OF YEAR.......................... $10.65 $12.12 $19.14 $12.41 $11.37
====== ====== ====== ====== ======
TOTAL RETURN (EXCLUDES SALES CHARGE)................. (11.28)% (25.43)% 76.87% 12.49% 23.72%
ANNUALIZED RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000).................... $3,094 $6,352 $3,446 $ 431 $ 160
Ratio of expenses to average net assets.............. 3.61% 2.70% 2.52% 2.46% 2.51%(f)
Ratio of interest expense to average net assets...... N/A N/A N/A 0.04% N/A
Ratio of net investment income (loss) to average net
assets............................................. (0.96)% (0.42)% 0.12% 1.05% 2.00%(f)
Ratio of expenses to average net assets (d).......... N/A N/A 2.51% N/A N/A
Ratio of expenses to average net assets (e).......... 3.61% 2.72% 3.24% 6.19% 28.70%(f)
Portfolio Turnover (g)............................... 77% 138% 205% 169% 115%
</TABLE>
- ---------
<TABLE>
<S> <C>
(a) Net investment income is based on average shares outstanding
during the period.
(b) For the period from March 7, 1995 (commencement of Class
operations) to September 30, 1995.
(c) The per share amount of net investment income is not in
accord with the distributions per share from net investment
income due to the timing of sales of Fund shares after the
Fund declared its annual income distribution on December 26,
1996. The distributions declared on such date were paid
principally from net investment income earned during the
previous fiscal year.
(d) During the period, certain fees were indirectly paid. If
such fees indirectly paid had not occurred, the ratios would
have been as indicated.
(e) During the period, certain fees were waived or reimbursed.
If such fees were not waived or reimbursed, the ratios would
have been as indicated.
(f) Annualized
(g) Portfolio turnover is calculated on the basis of the Fund,
as a whole, without distinguishing between the classes of
shares issued.
</TABLE>
-19-
<PAGE> 20
ALPINE U.S. REAL ESTATE EQUITY FUND
FINANCIAL HIGHLIGHTS
(FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD)
<TABLE>
<CAPTION>
YEAR ENDED SEPTEMBER 30,
-----------------------------------------------------------
1999(a) 1998(a) 1997(a) 1996(a) 1995(b)
------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C>
CLASS C SHARES
NET ASSET VALUE BEGINNING OF YEAR.................... $12.12 $19.13 $12.44 $11.41 $10.87
------ ------ ------ ------ ------
INCOME (LOSS) FROM INVESTMENT OPERATIONS
Net investment income (loss)....................... (0.15) (0.05) 0.03(c) 0.13 0.08
Net realized and unrealized gain (loss) foreign
exchange transactions, short sales and
investments...................................... (1.20) (4.17) 8.47 1.28 0.46
------ ------ ------ ------ ------
Total from investment operations................... (1.35) (4.22) 8.50 1.41 0.54
------ ------ ------ ------ ------
LESS DISTRIBUTIONS
Net investment income.............................. -- (0.11) (0.23)(c) (0.17) --
Net realized gains from investments................ -- (2.68) (1.58) (0.21) --
In excess of net realized gains from investments... (0.11) -- -- -- --
Tax return of capital.............................. (0.01) -- -- -- --
------ ------ ------ ------ ------
Total distributions................................ (0.12) (2.79) (1.81) (0.38) --
------ ------ ------ ------ ------
NET ASSET VALUE END OF YEAR.......................... $10.65 $12.12 $19.13 $12.44 $11.41
====== ====== ====== ====== ======
TOTAL RETURN (EXCLUDES SALES CHARGE)................. (11.28)% (25.38)% 76.89% 12.49% 4.97%
ANNUALIZED RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000).................... $1,299 $2,006 $1,673 $ 125 $ 3
Ratio of expenses to average net assets.............. 3.67% 2.70% 2.52% 2.47% 2.49%(f)
Ratio of interest expense to average net assets...... N/A N/A N/A 0.04% N/A
Ratio of net investment income (loss) to average net
assets............................................. (1.19)% (0.46)% 0.23% 1.08% 2.55%(f)
Ratio of expenses to average net assets (d).......... N/A N/A 2.51% N/A N/A
Ratio of expenses to average net assets (e).......... 3.67% 2.72% 3.24% 18.82% 421.54%(f)
Ratio of net investment income (loss) to average net
assets (e)......................................... (1.19)% (0.48)% 0.21% 1.06% 2.53%(f)
Portfolio Turnover (g)............................... 77% 138% 205% 169% 115%
</TABLE>
- ---------
<TABLE>
<S> <C>
(a) Net investment income is based on average shares outstanding
during the period.
(b) For the period from July 12, 1995 (commencement of Class
operations) to September 30, 1995.
(c) The per share amount of net investment income is not in
accord with the distributions per share from net investment
income due to the timing of sales of Fund shares after the
Fund declared its annual income distribution on December 26,
1996. The distributions declared on such date were paid
principally from net investment income earned during the
previous fiscal year.
(d) During the period, certain fees were indirectly paid. If
such fees indirectly paid had not occurred, the ratios would
have been as indicated.
(e) During the period, certain fees were waived or reimbursed.
If such fees were not waived or reimbursed, the ratios would
have been as indicated.
(f) Annualized
(g) Portfolio turnover is calculated on the basis of the Fund,
as a whole, without distinguishing between the classes of
shares issued.
</TABLE>
-20-
<PAGE> 21
ALPINE U.S. REAL ESTATE EQUITY FUND
FINANCIAL HIGHLIGHTS
(FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD)
<TABLE>
<CAPTION>
YEAR ENDED SEPTEMBER 30,
--------------------------------------------------------------
1999(a) 1998(a) 1997(a) 1996(a) 1995(a)
------- ------- ------- ------- ----------
<S> <C> <C> <C> <C> <C>
CLASS Y SHARES
NET ASSET VALUE BEGINNING OF YEAR.................... $ 12.47 $ 19.49 $ 12.56 $ 11.44 $10.07
------- ------- ------- ------- ------
INCOME (LOSS) FROM INVESTMENT OPERATIONS
Net investment income (loss)....................... (0.02) 0.13 0.16(b) 0.24 0.23
Net realized and unrealized gain (loss) foreign
exchange transactions, short sales and
investments...................................... (1.26) (4.32) 8.63 1.29 1.46
------- ------- ------- ------- ------
Total from investment operations................... (1.28) (4.19) 8.79 1.53 1.69
------- ------- ------- ------- ------
LESS DISTRIBUTIONS
Net investment income.............................. -- (0.15) (0.28)(b) (0.20) (0.20)
Net realized gains from investments................ -- (2.68) (1.58) (0.21) (0.12)
In excess of net realized gains from investments... (0.11) -- -- -- --
Tax return of capital.............................. (0.01) -- -- -- --
------- ------- ------- ------- ------
Total distributions................................ (0.12) (2.83) (1.86) (0.41) (0.32)
------- ------- ------- ------- ------
NET ASSET VALUE END OF YEAR.......................... $ 11.07 $ 12.47 $ 19.49 $ 12.56 $11.44
======= ======= ======= ======= ======
TOTAL RETURN....................................... (10.40)% (24.69)% 78.79% 13.57% 17.63%
ANNUALIZED RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000).................... $17,405 $25,832 $19,459 $10,601 $9,456
Ratio of expenses to average net assets.............. 2.68% 1.70% 1.51% 1.46% 1.50%
Ratio of interest expense to average net assets...... N/A N/A N/A 0.04% N/A
Ratio of net investment income (loss) to average net
assets............................................. (0.19)% 0.58% 1.10% 2.02% 2.45%
Ratio of expenses to average net assets (c).......... N/A N/A 1.50% N/A N/A
Ratio of expenses to average net assets (d).......... 2.68% 1.72% 2.26% 2.25% 2.70%
Ratio of net investment income (loss) to average net
assets (d)......................................... (0.19)% 0.56% 1.08% 2.00% 2.43%
Portfolio Turnover (e)............................... 77% 138% 205% 169% 115%
</TABLE>
- ---------
<TABLE>
<S> <C>
(a) Net investment income is based on average shares outstanding
during the period.
(b) The per share amount of net investment income is not in
accord with the distributions per share from net investment
income due to the timing of sales of Fund shares after the
Fund declared its annual income distribution on December 26,
1996. The distributions declared on such date were paid
principally from net investment income earned during the
previous fiscal year.
(c) During the period, certain fees were indirectly paid. If
such fees indirectly paid had not occurred, the ratios would
have been as indicated.
(d) During the period, certain fees were waived or reimbursed.
If such fees were not waived or reimbursed, the ratios would
have been as indicated.
(e) Portfolio turnover is calculated on the basis of the Fund,
as a whole, without distinguishing between the classes of
shares issued.
</TABLE>
-21-
<PAGE> 22
[This Page Intentionally Left Blank]
<PAGE> 23
[LOGO] ALPINE
U.S. REAL ESTATE
Equity Fund
ANNUAL REPORT
September 30, 1999
ALPINE U.S. REAL ESTATE EQUITY FUND
122 East 42nd Street, 37th floor
New York, NY 10168
(212) 687-5588
(11/99)
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
