UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
 
FORM N-CSR
 
CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT
INVESTMENT COMPANIES
 
Investment Company Act file number 811-08034
 
Franklin Real Estate Securities Trust
(Exact name of registrant as specified in charter)
 
One Franklin Parkway, San Mateo, CA 94403-1906
(Address of principal executive offices) (Zip code)
 
Alison Baur, One Franklin Parkway, San Mateo, CA 94403-1906
(Name and address of agent for service)
 
Registrant's telephone number, including area code: 650 312-2000
 
Date of fiscal year end: 4/30
 
Date of reporting period: 4/30/22
 
 
Item 1. Reports to Stockholders.
 
a.)
 
The following is a copy of the report transmitted to shareholders pursuant to Rule30e-1 under the Investment Company Act of 1940, as amended (the “1940 Act”) (17 CFR 270.30e-1.)


b.)
 
Include a copy of each notice transmitted to stockholders in reliance on Rule 30e-3 under the Act (17 CFR 270.30e-3) that contains disclosures specified by paragraph (c)(3) of that rule.   
Not Applicable
.
 
Annual
Report
and
shareholder
letter
Franklin
Real
Estate
Securities
Fund
A
Series
of
Franklin
Real
Estate
Securities
Trust
April
30,
2022
Sign
up
for
electronic
delivery
at
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FDIC
Insured
May
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Value
No
Bank
Guarantee
franklintempleton.com
Annual
Report
1
SHAREHOLDER
LETTER
Dear
Shareholder:
During
the
12
months
ended
April
30,
2022,
the
U.S.
economy
showed
progress
as
it
continued
to
recover
from
the
COVID-19
pandemic
amid
declining
unemployment
and
rising
wages
and
personal
consumption.
Growth
mostly
accelerated
in
2021
as
the
reopening
of
businesses,
widespread
vaccinations
and
federal
assistance
programs
boosted
consumer
spending,
excepting
slower
third-quarter
growth
as
the
swiftly
spreading
Delta
variant
hindered
global
supply
chains.
The
U.S.
economy
contracted
in
2022’s
first
quarter
given
a
record
trade
deficit
and
a
decline
in
inventory
investment.
Inflation
increased
during
the
12-month
period,
influenced
by
pandemic-related
supply
and
demand
imbalances,
higher
energy
prices,
Russia’s
invasion
of
Ukraine
and
broader
price
pressures.
During
most
of
the
period,
the
U.S.
Federal
Reserve
(Fed)
continued
quantitative
easing
measures
to
bolster
credit
markets
and
encourage
economic
activity.
However,
the
Fed
decreased
its
monthly
asset
purchases
starting
in
November
2021,
increased
its
tapering
in
subsequent
months
and
ended
purchases
in
March
2022.
To
support
its
goals
of
maximizing
employment
and
returning
long-term
annual
inflation
to
2%,
the
Fed
raised
the
federal
funds
target
rate
to
a
range
of
0.25%–0.50%
at
its
March
meeting.
Shortly
after
the
reporting
period,
at
its
May
meeting,
the
Fed
raised
its
key
target
rate
again
to
a
range
of
0.75%–1.00%
and
stated
its
anticipation
of
ongoing
increases.
Although
stocks
benefited
early
in
the
period
from
the
economic
recovery,
during
the
period’s
last
four
months,
investor
concerns
about
inflation,
geopolitics
and
interest
rates
reversed
most
gains,
and
most
bond
valuations
also
declined.
In
this
environment,
U.S.
stocks,
as
measured
by
the
Standard
&
Poor’s
®
500
Index,
posted
a
+0.21%
total
return
for
the
12-month
period.
1
We
are
committed
to
our
long-term
perspective
and
disciplined
investment
approach
as
we
conduct
a
rigorous,
fundamental
analysis
of
securities
with
a
regular
emphasis
on
investment
risk
management.
We
believe
active,
professional
investment
management
serves
investors
well.
We
also
recognize
the
important
role
of
financial
professionals
in
today’s
markets
and
encourage
investors
to
continue
to
seek
their
advice.
Amid
changing
markets
and
economic
conditions,
we
are
confident
investors
with
a
well-diversified
portfolio
and
a
patient,
long-term
outlook
should
be
well-positioned
for
the
years
ahead.
In
addition,
Franklin
Real
Estate
Securities
Fund’s
annual
report
includes
more
detail
about
prevailing
conditions
and
a
discussion
about
investment
decisions
during
the
period.
All
securities
markets
fluctuate,
as
do
mutual
fund
share
prices.
We
thank
you
for
investing
with
Franklin
Templeton,
welcome
your
questions
and
comments,
and
look
forward
to
serving
your
future
investment
needs.
Sincerely,
Edward
Perks,
CFA
President
and
Chief
Executive
Officer
Investment
Management
Franklin
Real
Estate
Securities
Trust
This
letter
reflects
our
analysis
and
opinions
as
of
April
30,
2022,
unless
otherwise
indicated.
The
information
is
not
a
complete
analysis
of
every
aspect
of
any
market,
country,
industry,
security
or
fund.
Statements
of
fact
are
from
sources
considered
reliable.
CFA
®
is
a
trademark
owned
by
CFA
Institute.
1.
Source:
Morningstar.
See
www.franklintempletondatasources.com
for
additional
data
provider
information.
franklintempleton.com
Annual
Report
2
Contents
Annual
Report
Franklin
Real
Estate
Securities
Fund
3
Performance
Summary
6
Your
Fund’s
Expenses
9
Financial
Highlights
and
Schedule
of
Investments
10
Financial
Statements
17
Notes
to
Financial
Statements
20
Report
of
Independent
Registered
Public
Accounting
Firm
28
Tax
Information
29
Special
Meeting
of
Shareholders
30
Board
Members
and
Officers
31
Shareholder
Information
36
Visit
franklintempleton.com
for
fund
updates,
to
access
your
account,
or
to
find
helpful
financial
planning
tools.
3
franklintempleton.com
Annual
Report
ANNUAL
REPORT
Franklin
Real
Estate
Securities
Fund
This
annual
report
for
Franklin
Real
Estate
Securities
Fund
covers
the
fiscal
year
ended
April
30,
2022
.
Your
Fund’s
Goal
and
Main
Investments
The
Fund
seeks
to
maximize
total
return.
Under
normal
market
conditions,
the
Fund
invests
at
least
80%
of
its
net
assets
in
equity
securities
of
companies
operating
in
the
real
estate
industry
predominantly
in
the
U.S.,
including
real
estate
investment
trusts
(REITs)
and
companies
that
derive
at
least
half
of
their
assets
or
revenues
from
the
ownership,
construction,
management,
operation,
development
or
sale
of
commercial
or
residential
real
estate.
1
Performance
Overview
The
Fund’s
Class
A
shares
posted
a
+11.99%
cumulative
total
return
for
the
12
months
under
review.
In
comparison,
the
Fund’s
benchmark,
the
MSCI
U.S.
IMI
Real
Estate
25/50
Index,
which
tracks
the
large,
mid-
and
small-cap
segments
of
the
U.S.
REIT
universe,
posted
a
+7.90%
cumulative
total
return.
2
You
can
find
the
Fund’s
long-term
performance
data
in
the
Performance
Summary
beginning
on
page
6
.
Performance
data
represent
past
performance,
which
does
not
guarantee
future
results.
Investment
return
and
principal
value
will
fluctuate,
and
you
may
have
a
gain
or
loss
when
you
sell
your
shares.
Current
performance
may
differ
from
figures
shown.
For
most
recent
month-end
performance,
go
to
franklintempleton.com
or
call
(800)
342-5236
.
Economic
and
Market
Overview
U.S.
equities,
as
measured
by
the
Standard
&
Poor’s
500
Index
(S&P
500
®
),
posted
a
+0.21%
total
return
for
the
12
months
ended
April
30,
2022.
2
Stocks
benefited
from
the
continued
economic
recovery,
implementation
of
COVID-19
vaccination
programs
and
resumption
of
both
business
and
leisure
travel.
Higher
wages
and
strong
household
balance
sheets
contributed
to
increased
consumer
spending,
particularly
on
goods.
A
rebound
in
corporate
earnings
and
the
passage
of
a
bipartisan
infrastructure
bill
further
bolstered
investor
sentiment.
However,
concerns
surrounding
inflation,
geopolitical
stability
and
interest
rates
erased
most
gains
in
the
final
third
of
the
12-month
period.
Elevated
demand
combined
with
supply
chain
disruptions
led
to
the
highest
inflation
since
1981.
Russia’s
invasion
of
Ukraine
injected
further
uncertainty
into
financial
markets,
provoking
significant
volatility
in
commodity
and
equity
prices.
Rising
interest
rates
also
pressured
stocks,
as
borrowing
costs
began
to
increase
from
historically
low
levels.
Gross
domestic
product
growth
was
robust
in
2021
before
contracting
in
the
first
quarter
of
2022
amid
lower
investments
in
inventories
and
a
growing
trade
deficit.
Nonetheless,
both
exports
and
imports
increased
significantly
and
industrial
production
grew
robustly.
However,
rising
prices
precipitated
a
notable
decline
in
consumer
confidence,
despite
high
spending
levels.
The
inflation
rate
was
notably
elevated
during
the
12-month
period
amid
increased
demand
and
supply-chain
bottlenecks.
Consequently,
the
personal
consumption
expenditures
index,
a
measure
of
inflation,
surged
during
Portfolio
Composition
4/30/22
%
of
Total
Net
Assets
Specialized
REITs
33.4%
Residential
REITs
17.3%
Industrial
REITs
15.3%
Retail
REITs
11.5%
Health
Care
REITs
7.6%
Office
REITs
6.5%
Hotel
&
Resort
REITs
3.5%
Diversified
REITs
1.6%
Real
Estate
Services
1.5%
Real
Estate
Development
1.0%
Other
0.4%
Short-Term
Investments
&
Other
Net
Assets
0.4%
1.
A
REIT
is
a
type
of
real
estate
company
that
is
dedicated
to
owning
and
usually
operating
income-producing
real
estate
properties
such
as
apartments,
hotels,
industrial
properties,
office
buildings
or
shopping
centers.
Equity
REITs
generally
receive
income
from
rents
received,
are
generally
operated
by
experienced
property
management
teams
and
typically
concentrate
on
a
specific
geographic
region
or
property
type.
2.
Source:
Morningstar.
The
index
is
unmanaged
and
includes
reinvestment
of
any
income
or
distributions.
It
does
not
reflect
any
fees,
expenses
or
sales
charges.
One
cannot
invest
directly
in
an
index,
and
an
index
is
not
representative
of
the
Fund’s
portfolio.
See
www.franklintempletondatasources.com
for
additional
data
provider
information.
The
dollar
value,
number
of
shares
or
principal
amount,
and
names
of
all
portfolio
holdings
are
listed
in
the
Fund’s
Schedule
of
Investments
(SOI).
The
SOI
begins
on
page
14
.
Franklin
Real
Estate
Securities
Fund
4
franklintempleton.com
Annual
Report
the
period,
representing
the
highest
12-month
increase
in
decades.
The
unemployment
rate
declined
from
6.0%
in
April
2021
to
3.6%
in
April
2022
as
job
openings
increased,
but
a
relative
lack
of
available
workers
fueled
wage
growth,
adding
to
some
investors’
inflation
concerns.
In
an
effort
to
control
inflation,
the
U.S.
Federal
Reserve
(Fed)
raised
the
federal
funds
target
rate
to
a
range
of
0.25%–0.50%
in
March
2022,
the
first
such
increase
since
2018.
The
Fed
noted
in
its
March
meeting
that
strength
in
the
U.S.
job
market
and
continued
inflationary
pressure,
exacerbated
by
the
war
in
Ukraine,
meant
it
anticipated
making
further
increases
to
the
federal
funds
target
rate.
Furthermore,
the
Fed
said
it
expected
to
begin
reducing
its
bond
holdings
at
a
future
meeting.
Investment
Strategy
We
are
research-driven,
fundamental
investors.
Our
investment
strategy
is
centered
on
the
belief
that
unsynchronized
economic
activity
within
real
estate
sectors
provides
consistent,
attractive
return
opportunities
in
real
estate
markets.
When
selecting
investments
for
the
Fund’s
portfolio,
we
use
a
bottom-up
security
selection
process
that
incorporates
macro-level
views
in
the
evaluation
process.
In
our
portfolio
construction
process,
we
analyze
individual
stock
and
real
estate
market
fundamentals
and
provide
regional,
property
type
and
company-size
perspectives
in
identifying
local
cyclical
and
thematic
trends
that
highlight
investment
opportunities.
Manager’s
Discussion
For
the
12
months
under
review,
Franklin
Real
Estate
Securities
Fund
outperformed
its
benchmark
due
primarily
to
stock
selection
and
an
underweighting
in
the
real
estate
services
sector
and
stock
selection
and
an
overweighting
in
the
industrial
property
sector.
Lack
of
exposure
to
the
specialty
sector,
which
delivered
positive
results
for
the
benchmark,
was
the
most
significant
detractor
from
relative
performance.
Relative
performance
in
the
real
estate
services
sector
benefited
from
our
avoidance
of
several
benchmark
stocks
that
declined
over
the
period.
The
Fund’s
top-two
relative
contributors,
Rexford
Industrial
Realty
and
Prologis,
were
in
the
industrial
property
sector.
Both
companies
lease
warehouse
space
and
have
been
benefiting
from
an
increase
in
warehouse
demand
from
e-commerce
expansion
and
supply-chain
shifts.
In
contrast,
Americold
Realty
Trust,
a
major
temperature-controlled
warehousing
and
transportation
company,
detracted
from
relative
returns
in
the
sector.
Elsewhere,
Camden
Property
Trust
was
a
leading
relative
contributor
in
the
residential
sector.
Camden
owns,
operates
and
develops
apartment
properties,
mostly
in
the
larger
Sun
Belt
markets
of
the
U.S.
We
continue
to
like
the
company
for
what
we
view
as
its
quality
assets
and
footprint,
proven
operating
platform,
strong
balance
sheet
and
seasoned
management
team.
In
the
storage
property
sector,
the
pandemic
sparked
strong
demand
for
storage
space,
generating
unprecedented
pricing
power
for
storage
companies.
Beneficiaries
included
our
holding
in
Public
Storage,
which
outperformed
over
the
period.
In
contrast,
Healthpeak
Properties
in
the
health
care
property
sector
was
a
meaningful
relative
detractor
over
the
period.
Healthpeak
is
a
diversified
REIT
focused
on
life
sciences
and
medical
office
property
management
and
niche
senior
housing
offerings.
The
stock’s
premium
valuation
eroded
as
financial
results
failed
to
significantly
outperform
expectations.
In
the
triple
net
sector,
Spirit
Realty
Capital
is
an
owner
and
acquirer
of
free-standing
single-tenant
properties,
mostly
in
non-discretionary
retail
and
services,
under
long-term
triple
net
lease
structures.
The
company
continues
to
enjoy
a
robust
acquisition
pipeline
that
provides
for
healthy
growth,
but
the
stock
underperformed
during
the
period,
likely
due
to
the
long-duration
nature
of
Spirit’s
assets
in
a
time
of
rising
bond
rates.
Top
10
Holdings
4/30/22
Company
Sub-Industry
%
of
Total
Net
Assets
a
a
Prologis,
Inc.
10.0%
Industrial
REITs
American
Tower
Corp.
6.1%
Specialized
REITs
Equinix
,
Inc.
5.9%
Specialized
REITs
Public
Storage
5.6%
Specialized
REITs
SBA
Communications
Corp.
5.0%
Specialized
REITs
Crown
Castle
International
Corp.
4.2%
Specialized
REITs
AvalonBay
Communities,
Inc.
4.2%
Residential
REITs
Welltower
,
Inc.
3.9%
Health
Care
REITs
Realty
Income
Corp.
3.5%
Retail
REITs
American
Homes
4
Rent
3.3%
Residential
REITs
Franklin
Real
Estate
Securities
Fund
5
franklintempleton.com
Annual
Report
In
the
data
centers
sector,
Equinix
owns,
develops
and
manages
more
than
200
data
centers
in
52
markets
worldwide,
providing
interconnection,
colocation
and
managed
IT
services
to
enterprises,
internet
service
companies
and
cloud
providers.
Equinix
lagged
over
the
period
due
to
concerns
about
slowing
growth
in
data
centers
amid
rising
churn.
Thank
you
for
your
continued
participation
in
Franklin
Real
Estate
Securities
Fund.
We
look
forward
to
serving
your
future
investment
needs.
Blair
Schmicker,
CFA
Daniel
Scher
Portfolio
Management
Team
The
foregoing
information
reflects
our
analysis,
opinions
and
portfolio
holdings
as
of
April
30,
2022,
the
end
of
the
reporting
period.
The
way
we
implement
our
main
investment
strategies
and
the
resulting
portfolio
holdings
may
change
depending
on
factors
such
as
market
and
economic
conditions.
These
opinions
may
not
be
relied
upon
as
investment
advice
or
an
offer
for
a
particular
security.
The
information
is
not
a
complete
analysis
of
every
aspect
of
any
market,
country,
industry,
security
or
the
Fund.
Statements
of
fact
are
from
sources
considered
reliable,
but
the
investment
manager
makes
no
representation
or
warranty
as
to
their
completeness
or
accuracy.
Although
historical
performance
is
no
guarantee
of
future
results,
these
insights
may
help
you
understand
our
investment
management
philosophy.
Performance
Summary
as
of
April
30,
2022
Franklin
Real
Estate
Securities
Fund
6
franklintempleton.com
Annual
Report
The
performance
table
and
graphs
do
not
reflect
any
taxes
that
a
shareholder
would
pay
on
Fund
dividends,
capital
gain
distributions,
if
any,
or
any
realized
gains
on
the
sale
of
Fund
shares.
Total
return
reflects
reinvestment
of
the
Fund’s
dividends
and
capital
gain
distributions,
if
any,
and
any
unrealized
gains
or
losses.
Your
dividend
income
will
vary
depending
on
dividends
or
interest
paid
by
securities
in
the
Fund’s
portfolio,
adjusted
for
operating
expenses
of
each
class.
Capital
gain
distributions
are
net
profits
realized
from
the
sale
of
portfolio
securities.
Performance
as
of
4/30/22
Cumulative
total
return
excludes
sales
charges.
Average
annual
total
return
includes
maximum
sales
charges.
Sales
charges
will
vary
depending
on
the
size
of
the
investment
and
the
class
of
share
purchased.
The
maximum
is
5.50%
and
the
minimum
is
0%.
Class
A
:
5.50%
maximum
initial
sales
charge;
Advisor
Class:
no
sales
charges.
For
other
share
classes,
visit
franklintempleton.com.
Performance
data
represent
past
performance,
which
does
not
guarantee
future
results.
Investment
return
and
principal
value
will
fluctuate,
and
you
may
have
a
gain
or
loss
when
you
sell
your
shares.
Current
performance
may
differ
from
figures
shown.
For
most
recent
month-end
performance,
go
to
franklintempleton.com
or
call
(800)
342-5236
.
Share
Class
Cumulative
Total
Return
1
Average
Annual
Total
Return
2
A
3
1-Year
+11.99%
+5.85%
5-Year
+54.51%
+7.87%
10-Year
+127.37%
+7.95%
Advisor
1-Year
+12.25%
+12.25%
5-Year
+56.43%
+9.36%
10-Year
+133.15%
+8.83%
See
page
8
for
Performance
Summary
footnotes.
Franklin
Real
Estate
Securities
Fund
Performance
Summary
7
franklintempleton.com
Annual
Report
See
page
8
for
Performance
Summary
footnotes.
Total
Return
Index
Comparison
for
a
Hypothetical
$10,000
Investment
Total
return
represents
the
change
in
value
of
an
investment
over
the
periods
shown.
It
includes
any
applicable
maximum
sales
charge,
Fund
expenses,
account
fees
and
reinvested
distributions.
The
unmanaged
index
includes
reinvestment
of
any
income
or
distributions.
It
differs
from
the
Fund
in
composition
and
does
not
pay
management
fees
or
expenses.
One
cannot
invest
directly
in
an
index.
Class
A
(5/1/12–4/30/22)
Advisor
Class
(5/1/12–4/30/22)
Franklin
Real
Estate
Securities
Fund
Performance
Summary
8
franklintempleton.com
Annual
Report
Each
class
of
shares
is
available
to
certain
eligible
investors
and
has
different
annual
fees
and
expenses,
as
described
in
the
prospectus.
All
investments
involve
risks,
including
possible
loss
of
principal.
The
Fund’s
concentration
in
real
estate
securities
involves
special
risks,
such
as
declines
in
the
value
of
real
estate
and
increased
susceptibility
to
adverse
economic
or
regulatory
developments
affecting
the
sector.
The
Fund’s
investments
in
REITs
involve
additional
risks;
since
REITs
typically
are
invested
in
a
limited
number
of
projects
or
in
a
particular
market
segment,
they
are
more
susceptible
to
adverse
developments
affecting
a
single
project
or
market
segment
than
more
broadly
diversified
investments.
Events
such
as
the
spread
of
deadly
diseases,
disasters,
and
financial,
political
or
social
disruptions,
may
heighten
risks
and
adversely
affect
performance.
The
Fund’s
prospectus
also
includes
a
description
of
the
main
investment
risks.
Russia’s
military
invasion
of
Ukraine
in
February
2022,
the
resulting
responses
by
the
United
States
and
other
countries,
and
the
potential
for
wider
conflict
could
increase
volatility
and
uncertainty
in
the
financial
markets
and
adversely
affect
regional
and
global
economies.
The
United
States
and
other
countries
have
im-
posed
broad-ranging
economic
sanctions
on
Russia
and
certain
Russian
individuals,
banking
entities
and
corporations
as
a
response
to
its
invasion
of
Ukraine.
The
United
States
and
other
countries
have
also
imposed
economic
sanctions
on
Belarus
and
may
impose
sanctions
on
other
countries
that
support
Russia’s
military
invasion.
These
sanctions,
as
well
as
any
other
economic
consequences
related
to
the
invasion,
such
as
additional
sanctions,
boycotts
or
changes
in
consumer
or
purchaser
preferences
or
cyberattacks
on
governments,
companies
or
individuals,
may
further
decrease
the
value
and
liquidity
of
certain
Russian
securities
and
securities
of
issuers
in
other
countries
that
are
subject
to
economic
sanctions
related
to
the
invasion.
1.
Cumulative
total
return
represents
the
change
in
value
of
an
investment
over
the
periods
indicated.
2.
Average
annual
total
return
represents
the
average
annual
change
in
value
of
an
investment
over
the
periods
indicated.
Return
for
less
than
one
year,
if
any,
has
not
been
annualized.
3.
Prior
to
9/10/18,
these
shares
were
offered
at
a
higher
initial
sales
charge
of
5.75%,
thus
actual
returns
(with
sales
charges)
would
have
differed.
Average
annual
total
returns
(with
sales
charges)
have
been
restated
to
reflect
the
current
maximum
initial
sales
charge
of
5.50%.
4.
Source:
Morningstar.
The
MSCI
U.S.
IMI
Real
Estate
25/50
Index
tracks
the
large,
mid-
and
small-cap
segments
of
the
U.S.
REIT
universe.
The
inception
date
of
the
MSCI
U.S.
IMI
Real
Estate
25/50
Index
was
September
1,
2016;
however,
the
performance
prior
to
its
inception
has
been
calculated
by
MSCI
for
purposes
of
this
chart.
5.
Figures
are
as
stated
in
the
Fund’s
current
prospectus
and
may
differ
from
the
expense
ratios
disclosed
in
the
Your
Fund’s
Expenses
and
Financial
Highlights
sections
in
this
report.
In
periods
of
market
volatility,
assets
may
decline
significantly,
causing
total
annual
Fund
operating
expenses
to
become
higher
than
the
figures
shown.
See
www.franklintempletondatasources.com
for
additional
data
provider
information.
Distributions
(5/1/21–4/30/22)
Share
Class
Net
Investment
Income
Short-Term
Capital
Gain
Long-Term
Capital
Gain
Total
A
$0.1804
$0.1255
$0.9722
$1.2781
C
$0.0894
$0.1255
$0.9722
$1.1871
R6
$0.2417
$0.1255
$0.9722
$1.3394
Advisor
$0.2118
$0.1255
$0.9722
$1.3095
Total
Annual
Operating
Expenses
5
Share
Class
A
1.07%
Advisor
0.82%
Your
Fund’s
Expenses
Franklin
Real
Estate
Securities
Fund
9
franklintempleton.com
Annual
Report
As
a
Fund
shareholder,
you
can
incur
two
types
of
costs:
(1)
transaction
costs,
including
sales
charges
(loads)
on
Fund
purchases
and
redemptions;
and
(2)
ongoing
Fund
costs,
including
management
fees,
distribution
and
service
(12b-1)
fees,
and
other
Fund
expenses.
All
mutual
funds
have
ongoing
costs,
sometimes
referred
to
as
operating
expenses.
The
table
below
shows
ongoing
costs
of
investing
in
the
Fund
and
can
help
you
understand
these
costs
and
compare
them
with
those
of
other
mutual
funds.
The
table
assumes
a
$1,000
investment
held
for
the
six
months
indicated.
Actual
Fund
Expenses
The
table
below
provides
information
about
actual
account
values
and
actual
expenses
in
the
columns
under
the
heading
“Actual.”
In
these
columns
the
Fund’s
actual
return,
which
includes
the
effect
of
Fund
expenses,
is
used
to
calculate
the
“Ending
Account
Value.”
You
can
estimate
the
expenses
you
paid
during
the
period
by
following
these
steps
(
of
course,
your
account
value
and
expenses
will
differ
from
those
in
this
illustration
):
Divide
your
account
value
by
$1,000
(
if
your
account
had
an
$8,600
value,
then
$8,600
÷
$1,000
=
8.6
).
Then
multiply
the
result
by
the
number
in
the
row
for
your
class
of
shares
under
the
headings
“Actual”
and
“Expenses
Paid
During
Period”
(
if
Actual
Expenses
Paid
During
Period
were
$7.50,
then
8.6
x
$7.50
=
$64.50
).
In
this
illustration,
the
actual
expenses
paid
this
period
are
$64.50.
Hypothetical
Example
for
Comparison
with
Other
Funds
Under
the
heading
“Hypothetical”
in
the
table,
information
is
provided
about
hypothetical
account
values
and
hypothetical
expenses
based
on
the
Fund’s
actual
expense
ratio
and
an
assumed
rate
of
return
of
5%
per
year
before
expenses,
which
is
not
the
Fund’s
actual
return.
This
information
may
not
be
used
to
estimate
the
actual
ending
account
balance
or
expenses
you
paid
for
the
period,
but
it
can
help
you
compare
ongoing
costs
of
investing
in
the
Fund
with
those
of
other
funds.
To
do
so,
compare
this
5%
hypothetical
example
for
the
class
of
shares
you
hold
with
the
5%
hypothetical
examples
that
appear
in
the
shareholder
reports
of
other
funds.
Please
note
that
expenses
shown
in
the
table
are
meant
to
highlight
ongoing
costs
and
do
not
reflect
any
transactional
costs.
Therefore,
information
under
the
heading
“Hypothetical”
is
useful
in
comparing
ongoing
costs
only,
and
will
not
help
you
compare
total
costs
of
owning
different
funds.
In
addition,
if
transactional
costs
were
included,
your
total
costs
would
have
been
higher.
1.
Expenses
are
equal
to
the
annualized
expense
ratio
for
the
six-month
period
as
indicated
above—in
the
far
right
column—multiplied
by
the
simple
average
account
value
over
the
period
indicated,
and
then
multiplied
by
181/365
to
reflect
the
one-half
year
period.
2.
Reflects
expenses
after
fee
waivers
and
expense
reimbursements.
Do
es
not
include
acquired
fund
fees
and
expenses.
Actual
(actual
return
after
expenses)
Hypothetical
(5%
annual
return
before
expenses)
Share
Class
Beginning
Account
Value
11/1/21
Ending
Account
Value
4/30/22
Expenses
Paid
During
Period
11/1/21–4/30/22
1,2
Ending
Account
Value
4/30/22
Expenses
Paid
During
Period
11/1/21–4/30/22
1,2
a
Net
Annualized
Expense
Ratio
2
A
$1,000
$994.30
$5.60
$1,019.18
$5.67
1.13%
C
$1,000
$990.60
$9.35
$1,015.40
$9.46
1.89%
R6
$1,000
$996.70
$2.93
$1,021.86
$2.97
0.59%
Advisor
$1,000
$995.20
$4.38
$1,020.41
$4.43
0.88%
Franklin
Real
Estate
Securities
Trust
Financial
Highlights
Franklin
Real
Estate
Securities
Fund
franklintempleton.com
Annual
Report
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
10
a
Year
Ended
April
30,
2022
2021
2020
2019
2018
Class
A
Per
share
operating
performance
(for
a
share
outstanding
throughout
the
year)
Net
asset
value,
beginning
of
year
...................
$20.66
$17.11
$21.69
$19.64
$22.40
Income
from
investment
operations
a
:
Net
investment
income
b
.........................
0.09
0.14
0.33
0.39
0.37
Net
realized
and
unrealized
gains
(losses)
...........
2.44
4.91
(1.41)
2.69
(0.79)
Total
from
investment
operations
....................
2.53
5.05
(1.08)
3.08
(0.42)
Less
distributions
from:
Net
investment
income
..........................
(0.18)
(0.21)
(0.28)
(0.37)
(0.38)
Net
realized
gains
.............................
(1.10)
(1.29)
(3.22)
(0.66)
(1.96)
Total
distributions
...............................
(1.28)
(1.50)
(3.50)
(1.03)
(2.34)
Net
asset
value,
end
of
year
.......................
$21.91
$20.66
$17.11
$21.69
$19.64
Total
return
c
...................................
11.99%
30.97%
(6.96)%
16.32%
(2.66)%
Ratios
to
average
net
assets
Expenses
d
....................................
1.11%
1.07%
e
1.00%
e
1.01%
e
1.11%
e
Net
investment
income
...........................
0.41%
0.77%
1.53%
1.89%
1.72%
Supplemental
data
Net
assets,
end
of
year
(000’s)
.....................
$361,133
$318,415
$281,341
$338,260
$327,085
Portfolio
turnover
rate
............................
22.14%
19.61%
53.37%
21.85%
19.84%
a
The
amount
shown
for
a
share
outstanding
throughout
the
period
may
not
correlate
with
the
Statement
of
Operations
for
the
period
due
to
the
timing
of
sales
and
repurchases
of
the
Fund’s
shares
in
relation
to
income
earned
and/or
fluctuating
fair
value
of
the
investments
of
the
Fund.
b
Based
on
average
daily
shares
outstanding.
c
Total
return
does
not
reflect
sales
commissions
or
contingent
deferred
sales
charges,
if
applicable.
d
Benefit
of
waiver
and
payments
by
affiliates
rounds
to
less
than
0.01%.
e
Benefit
of
expense
reduction
rounds
to
less
than
0.01%.
Franklin
Real
Estate
Securities
Trust
Financial
Highlights
Franklin
Real
Estate
Securities
Fund
(continued)
franklintempleton.com
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
Annual
Report
11
a
Year
Ended
April
30,
2022
2021
2020
2019
2018
Class
C
Per
share
operating
performance
(for
a
share
outstanding
throughout
the
year)
Net
asset
value,
beginning
of
year
...................
$19.37
$16.12
$20.66
$18.77
$21.56
Income
from
investment
operations
a
:
Net
investment
income
(loss)
b
....................
(0.08)
c
0.16
0.25
0.20
Net
realized
and
unrealized
gains
(losses)
...........
2.29
4.61
(1.31)
2.54
(0.77)
Total
from
investment
operations
....................
2.21
4.61
(1.15)
2.79
(0.57)
Less
distributions
from:
Net
investment
income
..........................
(0.09)
(0.07)
(0.17)
(0.24)
(0.26)
Net
realized
gains
.............................
(1.10)
(1.29)
(3.22)
(0.66)
(1.96)
Total
distributions
...............................
(1.19)
(1.36)
(3.39)
(0.90)
(2.22)
Net
asset
value,
end
of
year
.......................
$20.39
$19.37
$16.12
$20.66
$18.77
Total
return
d
...................................
11.13%
29.96%
(7.62)%
15.49%
(3.43)%
Ratios
to
average
net
assets
Expenses
e
....................................
1.87%
1.82%
f
1.75%
f
1.76%
f
1.86%
f
Net
investment
income
(loss)
......................
(0.38)%
0.02%
0.78%
1.14%
0.97%
Supplemental
data
Net
assets,
end
of
year
(000’s)
.....................
$17,704
$23,912
$28,634
$39,619
$61,867
Portfolio
turnover
rate
............................
22.14%
19.61%
53.37%
21.85%
19.84%
a
The
amount
shown
for
a
share
outstanding
throughout
the
period
may
not
correlate
with
the
Statement
of
Operations
for
the
period
due
to
the
timing
of
sales
and
repurchases
of
the
Fund’s
shares
in
relation
to
income
earned
and/or
fluctuating
fair
value
of
the
investments
of
the
Fund.
b
Based
on
average
daily
shares
outstanding.
c
Amount
rounds
to
less
than
$0.01
per
share.
d
Total
return
does
not
reflect
sales
commissions
or
contingent
deferred
sales
charges,
if
applicable.
e
Benefit
of
waiver
and
payments
by
affiliates
rounds
to
less
than
0.01%.
f
Benefit
of
expense
reduction
rounds
to
less
than
0.01%.
Franklin
Real
Estate
Securities
Trust
Financial
Highlights
Franklin
Real
Estate
Securities
Fund
(continued)
franklintempleton.com
Annual
Report
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
12
a
Year
Ended
April
30,
2022
2021
2020
2019
2018
Class
R6
Per
share
operating
performance
(for
a
share
outstanding
throughout
the
year)
Net
asset
value,
beginning
of
year
...................
$21.03
$17.39
$21.97
$19.87
$22.61
Income
from
investment
operations
a
:
Net
investment
income
b
.........................
0.21
0.22
0.41
0.49
0.43
Net
realized
and
unrealized
gains
(losses)
...........
2.49
4.99
(1.43)
2.72
(0.75)
Total
from
investment
operations
....................
2.70
5.21
(1.02)
3.21
(0.32)
Less
distributions
from:
Net
investment
income
..........................
(0.24)
(0.28)
(0.34)
(0.45)
(0.46)
Net
realized
gains
.............................
(1.10)
(1.29)
(3.22)
(0.66)
(1.96)
Total
distributions
...............................
(1.34)
(1.57)
(3.56)
(1.11)
(2.42)
Net
asset
value,
end
of
year
.......................
$22.39
$21.03
$17.39
$21.97
$19.87
Total
return
....................................
12.56%
31.51%
(6.61)%
16.86%
(2.19)%
Ratios
to
average
net
assets
Expenses
before
waiver
and
payments
by
affiliates
......
0.63%
0.73%
0.81%
0.80%
0.76%
Expenses
net
of
waiver
and
payments
by
affiliates
.......
0.60%
0.67%
c
0.60%
c
0.58%
c
0.60%
c
Net
investment
income
...........................
0.93%
1.16%
1.93%
2.32%
2.23%
Supplemental
data
Net
assets,
end
of
year
(000’s)
.....................
$37,871
$32,831
$3,589
$3,699
$3,794
Portfolio
turnover
rate
............................
22.14%
19.61%
53.37%
21.85%
19.84%
a
The
amount
shown
for
a
share
outstanding
throughout
the
period
may
not
correlate
with
the
Statement
of
Operations
for
the
period
due
to
the
timing
of
sales
and
repurchases
of
the
Fund’s
shares
in
relation
to
income
earned
and/or
fluctuating
fair
value
of
the
investments
of
the
Fund.
b
Based
on
average
daily
shares
outstanding.
c
Benefit
of
expense
reduction
rounds
to
less
than
0.01%.
Franklin
Real
Estate
Securities
Trust
Financial
Highlights
Franklin
Real
Estate
Securities
Fund
(continued)
franklintempleton.com
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
Annual
Report
13
a
Year
Ended
April
30,
2022
2021
2020
2019
2018
Advisor
Class
Per
share
operating
performance
(for
a
share
outstanding
throughout
the
year)
Net
asset
value,
beginning
of
year
...................
$20.97
$17.35
$21.93
$19.85
$22.59
Income
from
investment
operations
a
:
Net
investment
income
b
.........................
0.15
0.19
0.38
0.45
0.44
Net
realized
and
unrealized
gains
(losses)
...........
2.48
4.98
(1.42)
2.71
(0.81)
Total
from
investment
operations
....................
2.63
5.17
(1.04)
3.16
(0.37)
Less
distributions
from:
Net
investment
income
..........................
(0.21)
(0.26)
(0.32)
(0.42)
(0.41)
Net
realized
gains
.............................
(1.10)
(1.29)
(3.22)
(0.66)
(1.96)
Total
distributions
...............................
(1.31)
(1.55)
(3.54)
(1.08)
(2.37)
Net
asset
value,
end
of
year
.......................
$22.29
$20.97
$17.35
$21.93
$19.85
Total
return
....................................
12.25%
31.27%
(6.71)%
16.62%
(2.42)%
Ratios
to
average
net
assets
Expenses
c
.....................................
0.86%
0.82%
d
0.75%
d
0.76%
d
0.86%
d
Net
investment
income
...........................
0.65%
1.01%
1.78%
2.14%
1.97%
Supplemental
data
Net
assets,
end
of
year
(000’s)
.....................
$63,140
$67,206
$65,889
$75,240
$71,000
Portfolio
turnover
rate
............................
22.14%
19.61%
53.37%
21.85%
19.84%
a
The
amount
shown
for
a
share
outstanding
throughout
the
period
may
not
correlate
with
the
Statement
of
Operations
for
the
period
due
to
the
timing
of
sales
and
repurchases
of
the
Fund’s
shares
in
relation
to
income
earned
and/or
fluctuating
fair
value
of
the
investments
of
the
Fund.
b
Based
on
average
daily
shares
outstanding.
c
Benefit
of
waiver
and
payments
by
affiliates
rounds
to
less
than
0.01%.
d
Benefit
of
expense
reduction
rounds
to
less
than
0.01%.
Franklin
Real
Estate
Securities
Trust
Schedule
of
Investments,
April
30,
2022
Franklin
Real
Estate
Securities
Fund
franklintempleton.com
Annual
Report
The
accompanying
notes
are
an
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part
of
these
financial
statements.
14
a
a
Country
Shares
a
Value
a
Common
Stocks
99.6%
Diversified
REITs
1.6%
American
Assets
Trust,
Inc.
..............................
United
States
79,721
$
2,917,789
Broadstone
Net
Lease,
Inc.
..............................
United
States
149,476
3,092,658
Empire
State
Realty
Trust,
Inc.,
A
.........................
United
States
198,464
1,714,729
7,725,176
Health
Care
REITs
7.6%
Healthcare
Realty
Trust,
Inc.
.............................
United
States
123,307
3,339,154
Healthpeak
Properties,
Inc.
..............................
United
States
443,648
14,556,091
Welltower
,
Inc.
.......................................
United
States
204,003
18,525,512
36,420,757
Hotel
&
Resort
REITs
3.5%
Host
Hotels
&
Resorts,
Inc.
..............................
United
States
466,992
9,503,287
a
Ryman
Hospitality
Properties,
Inc.
.........................
United
States
79,418
7,423,995
16,927,282
Hotels,
Resorts
&
Cruise
Lines
0.3%
a
Airbnb,
Inc.,
A
........................................
United
States
7,891
1,208,980
a
Industrial
REITs
15.3%
Americold
Realty
Trust
.................................
United
States
143,863
3,795,106
First
Industrial
Realty
Trust,
Inc.
..........................
United
States
113,481
6,581,898
Prologis,
Inc.
.........................................
United
States
299,022
47,930,236
Rexford
Industrial
Realty,
Inc.
............................
United
States
191,823
14,969,867
73,277,107
Office
REITs
6.5%
Alexandria
Real
Estate
Equities,
Inc.
.......................
United
States
86,427
15,743,543
City
Office
REIT,
Inc.
...................................
United
States
76,767
1,139,222
Cousins
Properties,
Inc.
................................
United
States
221,240
7,942,516
Kilroy
Realty
Corp.
....................................
United
States
91,582
6,410,740
31,236,021
Real
Estate
Development
1.0%
a
Howard
Hughes
Corp.
(The)
.............................
United
States
46,866
4,700,191
a
Real
Estate
Operating
Companies
0.1%
a,b
WeWork
,
Inc.
........................................
United
States
82,418
577,750
a
Real
Estate
Services
1.5%
a
CBRE
Group,
Inc.,
A
...................................
United
States
85,229
7,077,416
a
Residential
REITs
17.3%
American
Homes
4
Rent,
A
..............................
United
States
397,858
15,759,155
AvalonBay
Communities,
Inc.
............................
United
States
87,862
19,986,848
Camden
Property
Trust
.................................
United
States
79,344
12,448,280
Equity
LifeStyle
Properties,
Inc.
...........................
United
States
183,087
14,148,963
Independence
Realty
Trust,
Inc.
..........................
United
States
199,686
5,443,440
UDR,
Inc.
...........................................
United
States
289,050
15,380,351
83,167,037
Retail
REITs
11.5%
NETSTREIT
Corp.
....................................
United
States
176,560
3,817,227
Realty
Income
Corp.
...................................
United
States
242,290
16,805,234
Regency
Centers
Corp.
.................................
United
States
174,432
12,006,155
RPT
Realty
..........................................
United
States
268,282
3,565,468
Simon
Property
Group,
Inc.
..............................
United
States
59,221
6,988,078
SITE
Centers
Corp.
....................................
United
States
238,835
3,797,477
Franklin
Real
Estate
Securities
Trust
Schedule
of
Investments
Franklin
Real
Estate
Securities
Fund
(continued)
franklintempleton.com
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
Annual
Report
15
See
Abbreviations
on
page
27
.
a
a
Country
Shares
a
Value
a
Common
Stocks
(continued)
Retail
REITs
(continued)
Spirit
Realty
Capital,
Inc.
................................
United
States
194,307
$
8,442,639
55,422,278
Specialized
REITs
33.4%
American
Tower
Corp.
..................................
United
States
121,779
29,351,175
Crown
Castle
International
Corp.
..........................
United
States
108,087
20,018,793
Equinix
,
Inc.
.........................................
United
States
39,533
28,427,390
Life
Storage,
Inc.
......................................
United
States
50,375
6,674,184
Public
Storage
.......................................
United
States
71,851
26,692,646
SBA
Communications
Corp.
.............................
United
States
69,459
24,109,913
VICI
Properties,
Inc.
...................................
United
States
353,624
10,541,538
Weyerhaeuser
Co.
....................................
United
States
350,994
14,467,973
160,283,612
Total
Common
Stocks
(Cost
$288,388,689)
.....................................
478,023,607
Short
Term
Investments
0.1%
a
a
Country
Shares
a
Value
a
a
a
a
a
a
Money
Market
Funds
0.0%
c,d
Institutional
Fiduciary
Trust
-
Money
Market
Portfolio,
0.0
2
4%
....
United
States
25
25
Total
Money
Market
Funds
(Cost
$25)
..........................................
25
e
Investments
from
Cash
Collateral
Received
for
Loaned
Securities
0.1%
Money
Market
Funds
0.1%
c,d
Institutional
Fiduciary
Trust
-
Money
Market
Portfolio,
0.0
2
4%
....
United
States
325,000
325,000
Principal
Amount
*
Repurchase
Agreements
0.0%
f
Joint
Repurchase
Agreement,
J.P.
Morgan
Securities
LLC,
0.28%,
5/02/22
(Maturity
Value
$82,268)
Collateralized
by
U.S.
Treasury
Bill,
Discount
Note,
5/17/22
-
8/11/22;
and
U.S.
Treasury
Note,
0.125%,
7/31/22
(valued
at
$83,911)
..........................................
82,266
82,266
Total
Investments
from
Cash
Collateral
Received
for
Loaned
Securities
(Cost
$407,266)
...................................................................
407,266
Total
Short
Term
Investments
(Cost
$407,291
)
..................................
407,291
a
Total
Investments
(Cost
$288,795,980)
99.7%
...................................
$478,430,898
Other
Assets,
less
Liabilities
0.3%
.............................................
1,416,048
Net
Assets
100.0%
...........................................................
$479,846,946
*
The
principal
amount
is
stated
in
U.S.
dollars
unless
otherwise
indicated.
Rounds
to
less
than
0.1%
of
net
assets.
a
Non-income
producing.
b
A
portion
or
all
of
the
security
is
on
loan
at
April
30,
2022.
See
Note
1(c).
c
See
Note
3(f)
regarding
investments
in
affiliated
management
investment
companies.
Franklin
Real
Estate
Securities
Trust
Schedule
of
Investments
Franklin
Real
Estate
Securities
Fund
(continued)
franklintempleton.com
Annual
Report
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
16
d
The
rate
shown
is
the
annualized
seven-day
effective
yield
at
period
end.
e
See
Note
1(c)
regarding
securities
on
loan.
f
See
Note
1(b)
regarding
joint
repurchase
agreement.
Franklin
Real
Estate
Securities
Trust
Financial
Statements
Statement
of
Assets
and
Liabilities
April
30,
2022
franklintempleton.com
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
Annual
Report
17
Franklin
Real
Estate
Securities
Fund
Class
A:
Net
assets,
at
value
.......................................................................
$361,132,516
Shares
outstanding
........................................................................
16,481,593
Net
asset
value
per
share
a
..................................................................
$21.91
Maximum
offering
price
per
share
(net
asset
value
per
share
÷
94.50%)
................................
$23.19
Class
C:
Net
assets,
at
value
.......................................................................
$17,704,291
Shares
outstanding
........................................................................
868,314
Net
asset
value
and
maximum
offering
price
per
share
a
.............................................
$20.39
Class
R6:
Net
assets,
at
value
.......................................................................
$37,870,512
Shares
outstanding
........................................................................
1,691,728
Net
asset
value
and
maximum
offering
price
per
share
.............................................
$22.39
Advisor
Class:
Net
assets,
at
value
.......................................................................
$63,139,627
Shares
outstanding
........................................................................
2,833,099
Net
asset
value
and
maximum
offering
price
per
share
.............................................
$22.29
Franklin
Real
Estate
Securities
Fund
Assets:
Investments
in
securities:
Cost
-
Unaffiliated
issuers
...................................................................
$288,388,689
Cost
-
Non-controlled
affiliates
(Note
3f)
........................................................
325,025
Cost
-
Unaffiliated
repurchase
agreements
......................................................
82,266
Value
-
Unaffiliated
issuers
(Includes
securities
loaned
of
$380,643)
...................................
$478,023,607
Value
-
Non-controlled
affiliates
(Note
3f)
........................................................
325,025
Value
-
Unaffiliated
repurchase
agreements
......................................................
82,266
Receivables:
Investment
securities
sold
...................................................................
3,490,767
Capital
shares
sold
........................................................................
403,807
Dividends
...............................................................................
179,082
European
Union
tax
reclaims
(Note
1
d
)
.........................................................
25,811
Total
assets
..........................................................................
482,530,365
Liabilities:
Payables:
Capital
shares
redeemed
...................................................................
338,357
Management
fees
.........................................................................
208,299
Distribution
fees
..........................................................................
93,512
Transfer
agent
fees
........................................................................
205,992
Trustees'
fees
and
expenses
.................................................................
14,815
Funds
advanced
by
custodian
.................................................................
1,265,741
Payable
upon
return
of
securities
loaned
(Note
1
c
)
..................................................
407,266
Accrued
expenses
and
other
liabilities
...........................................................
149,437
Total
liabilities
.........................................................................
2,683,419
Net
assets,
at
value
.................................................................
$479,846,946
Net
assets
consist
of:
Paid-in
capital
.............................................................................
$295,030,946
Total
distributable
earnings
(losses)
.............................................................
184,816,000
Net
assets,
at
value
.................................................................
$479,846,946
a
Redemption
price
is
equal
to
net
asset
value
less
contingent
deferred
sales
charges,
if
applicable.
Franklin
Real
Estate
Securities
Trust
Financial
Statements
Statement
of
Operations
for
the
year
ended
April
30,
2022
franklintempleton.com
Annual
Report
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
18
Franklin
Real
Estate
Securities
Fund
Investment
income:
Dividends:
(net
of
foreign
taxes
of
$11,559)
Unaffiliated
issuers
........................................................................
$7,273,860
Non-controlled
affiliates
(Note
3f)
.............................................................
297
Income
from
securities
loaned:
Unaffiliated
entities
(net
of
fees
and
rebates)
.....................................................
1,211
Non-controlled
affiliates
(Note
3f)
.............................................................
23
Total
investment
income
...................................................................
7,275,391
Expenses:
Management
fees
(Note
3
a
)
...................................................................
2,404,445
Distribution
fees:
(Note
3c
)
    Class
A
................................................................................
890,977
    Class
C
................................................................................
203,122
Transfer
agent
fees:
(Note
3e
)
    Class
A
................................................................................
1,044,608
    Class
C
................................................................................
60,154
    Class
R6
...............................................................................
24,221
    Advisor
Class
............................................................................
187,538
Custodian
fees
(Note
4
)
......................................................................
2,399
Reports
to
shareholders
fees
..................................................................
91,211
Registration
and
filing
fees
....................................................................
100,302
Professional
fees
...........................................................................
73,952
Trustees'
fees
and
expenses
..................................................................
19,084
Other
....................................................................................
24,773
Total
expenses
.........................................................................
5,126,786
Expenses
waived/paid
by
affiliates
(Note
3
f
and
3
g
)
..............................................
(16,153)
Net
expenses
.........................................................................
5,110,633
Net
investment
income
................................................................
2,164,758
Realized
and
unrealized
gains
(losses):
Net
realized
gain
(loss)
from:
Investments:
Unaffiliated
issuers
......................................................................
23,333,627
Foreign
currency
transactions
................................................................
(4,537)
Net
realized
gain
(loss)
..................................................................
23,329,090
Net
change
in
unrealized
appreciation
(depreciation)
on:
Investments:
Unaffiliated
issuers
......................................................................
26,955,645
Translation
of
other
assets
and
liabilities
denominated
in
foreign
currencies
..............................
(5,289)
Net
change
in
unrealized
appreciation
(depreciation)
............................................
26,950,356
Net
realized
and
unrealized
gain
(loss)
............................................................
50,279,446
Net
increase
(decrease)
in
net
assets
resulting
from
operations
..........................................
$52,444,204
Franklin
Real
Estate
Securities
Trust
Financial
Statements
Statements
of
Changes
in
Net
Assets
franklintempleton.com
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
Annual
Report
19
Franklin
Real
Estate
Securities
Fund
Year
Ended
April
30,
2022
Year
Ended
April
30,
2021
Increase
(decrease)
in
net
assets:
Operations:
Net
investment
income
.................................................
$2,164,758
$3,025,340
Net
realized
gain
(loss)
.................................................
23,329,090
15,567,334
Net
change
in
unrealized
appreciation
(depreciation)
...........................
26,950,356
90,518,396
Net
increase
(decrease)
in
net
assets
resulting
from
operations
................
52,444,204
109,111,070
Distributions
to
shareholders:
Class
A
.............................................................
(20,337,420)
(22,730,266)
Class
C
.............................................................
(1,008,188)
(1,827,864)
Class
R6
............................................................
(2,252,095)
(1,173,748)
Advisor
Class
........................................................
(3,642,159)
(4,888,603)
Total
distributions
to
shareholders
..........................................
(27,239,862)
(30,620,481)
Capital
share
transactions:
(Note
2
)
Class
A
.............................................................
24,750,920
(18,776,518)
Class
C
.............................................................
(7,699,349)
(9,332,002)
Class
R6
............................................................
2,863,851
23,999,112
Advisor
Class
........................................................
(7,636,674)
(11,469,984)
Total
capital
share
transactions
............................................
12,278,748
(15,579,392)
Net
increase
(decrease)
in
net
assets
...................................
37,483,090
62,911,197
Net
assets:
Beginning
of
year
.......................................................
442,363,856
379,452,659
End
of
year
...........................................................
$479,846,946
$442,363,856
Franklin
Real
Estate
Securities
Trust
Notes
to
Financial
Statements
Franklin
Real
Estate
Securities
Fund
20
franklintempleton.com
Annual
Report
1.
Organization
and
Significant
Accounting
Policies
Franklin
Real
Estate
Securities
Trust (Trust)
is
registered
under
the
Investment
Company
Act
of
1940
(1940
Act)
as
an
open-end
management
investment
company,
consisting
of
one
fund, Franklin
Real
Estate
Securities
Fund
(Fund)
and
applies
the
specialized
accounting
and
reporting
guidance
in
U.S.
Generally
Accepted
Accounting
Principles
(U.S.
GAAP).
The
Fund
offers
four
classes
of
shares:
Class
A,
Class
C,
Class
R6
and
Advisor
Class.
Effective
August
2,
2021,
Class
C
shares
automatically
convert
to
Class
A
shares
on
a
monthly
basis
after
they
have
been
held
for
8
years.
Prior
to
August
2,
2021,
Class
C
shares
converted
to
Class
A
shares
after
a
10-year
holding
period.
Each
class
of
shares
may
differ
by
its
initial
sales
load,
contingent
deferred
sales
charges,
voting
rights
on
matters
affecting
a
single
class,
its
exchange
privilege
and
fees
due
to
differing
arrangements
for
distribution
and
transfer
agent
fees.
The
following
summarizes
the Fund's
significant
accounting
policies.
a.
Financial
Instrument
Valuation 
The
Fund's
investments
in
financial
instruments
are
carried
at
fair
value
daily.
Fair
value
is
the
price
that
would
be
received
to
sell
an
asset
or
paid
to
transfer
a
liability
in
an
orderly
transaction
between
market
participants
on
the
measurement
date.
The
Fund
calculates
the
net
asset
value
(NAV)
per
share
each business
day as
of
4
p.m.
Eastern
time
or
the
regularly
scheduled
close
of
the
New
York
Stock
Exchange
(NYSE),
whichever
is
earlier.
Under
compliance
policies
and
procedures
approved
by
the
Fund's
Board
of
Trustees
(the
Board),
the Fund's
administrator
has
responsibility
for
oversight
of
valuation,
including
leading
the
cross-functional
Valuation
Committee
(VC).
The
Fund
may
utilize
independent
pricing
services,
quotations
from
securities
and
financial
instrument
dealers,
and
other
market
sources
to
determine
fair
value.
Equity
securities
listed
on
an
exchange
or
on
the
NASDAQ
National
Market
System
are
valued
at
the
last
quoted
sale
price
or
the
official
closing
price of
the
day,
respectively.
Over-the-counter
(OTC)
securities
are
valued
within
the
range
of
the
most
recent
quoted
bid
and
ask
prices.
Securities
that
trade
in
multiple
markets
or
on
multiple
exchanges
are
valued
according
to
the
broadest
and
most
representative
market.
Certain
equity
securities
are
valued
based
upon
fundamental
characteristics
or
relationships
to
similar
securities. 
Investments
in open-end mutual
funds
are
valued
at
the
closing
NAV.
The
Fund
has
procedures
to
determine
the
fair
value
of
financial
instruments
for
which
market
prices
are
not
reliable
or
readily
available.
Under
these
procedures,
the Fund
primarily
employs
a
market-based
approach
which
may
use
related
or
comparable
assets
or
liabilities,
recent
transactions,
market
multiples,
book
values,
and
other
relevant
information
for
the
investment
to
determine
the
fair
value
of
the
investment.
An
income-based
valuation
approach
may
also
be
used
in
which
the
anticipated
future
cash
flows
of
the
investment
are
discounted
to
calculate
fair
value.
Discounts
may
also
be
applied
due
to
the
nature
or
duration
of
any
restrictions
on
the
disposition
of
the
investments.
Due
to
the
inherent
uncertainty
of
valuations
of
such
investments,
the
fair
values
may
differ
significantly
from
the
values
that
would
have
been
used
had
an
active
market
existed.
b.
Joint
Repurchase
Agreement
The
Fund
enters
into
a
joint
repurchase
agreement
whereby
its
uninvested
cash
balance
is
deposited
into
a
joint
cash
account
with
other
funds
managed
by
the
investment
manager
or
an
affiliate
of
the
investment
manager
and
is
used
to
invest
in
one
or
more
repurchase
agreements.
The
value
and
face
amount
of
the
joint
repurchase
agreement
are
allocated
to
the
funds
based
on
their
pro-rata
interest.
A
repurchase
agreement
is
accounted
for
as
a
loan
by
the
Fund
to
the
seller,
collateralized
by
securities
which
are
delivered
to
the
Fund's
custodian.
The
fair
value,
including
accrued
interest,
of
the
initial
collateralization
is
required
to
be
at
least
102%
of
the
dollar
amount
invested
by
the
funds,
with
the
value
of
the
underlying
securities
marked
to
market
daily
to
maintain
coverage
of
at
least
100%.
Repurchase
agreements
are
subject
to
the
terms
of
Master
Repurchase
Agreements
(MRAs)
with
approved
counterparties
(sellers).
The
MRAs
contain
various
provisions,
including
but
not
limited
to
events
of
default
and
maintenance
of
collateral
for
repurchase
agreements.
In
the
event
of
default
by
either
the
seller
or
the
Fund,
certain
MRAs
may
permit
the
non-
defaulting
party
to
net
and
close-out
all
transactions,
if
any,
traded
under
such
agreements.
The
Fund
may
sell
securities
it
holds
as
collateral
and
apply
the
proceeds
towards
the
repurchase
price
and
any
other
amounts
owed
by
the
seller
to
the
Fund
in
the
event
of
default
by
the
seller.
This
could
involve
costs
or
delays
in
addition
to
a
loss
on
the
securities
if
their
value
falls
below
the
repurchase
price
owed
by
the
Franklin
Real
Estate
Securities
Trust
Notes
to
Financial
Statements
21
franklintempleton.com
Annual
Report
Franklin
Real
Estate
Securities
Fund
(continued)
seller.
The
joint
repurchase
agreement
held
by
the Fund
at
year
end,
as
indicated
in
the
Schedule
of
Investments,
had
been
entered
into
on
April
29,
2022.
c.
Securities
Lending
The
Fund
participates
in
an
agency
based
securities
lending
program
to
earn
additional
income.
The
Fund
receives
collateral
in
the
form
of
cash
and/or
U.S.
Government
and
Agency
securities
against
the
loaned
securities
in
an
amount
equal
to
at
least
102%
of
the
fair
value
of
the
loaned
securities.
Collateral
is
maintained
over
the
life
of
the
loan
in
an
amount
not
less
than
100%
of
the
fair
value
of
loaned
securities,
as
determined
at
the
close
of
Fund
business
each
day;
any
additional
collateral
required
due
to
changes
in
security
values
is
delivered
to
the
Fund
on
the
next
business
day.
Any
cash
collateral
received
is
deposited
into
a
joint
cash
account
with
other
funds
and
is
used
to
invest
in
a
money
market
fund
managed
by
Franklin
Advisers,
Inc.,
an
affiliate
of
the Fund,
and/or
a
joint
repurchase
agreement.
The
Fund
may
receive
income
from
the
investment
of
cash
collateral,
in
addition
to
lending
fees
and
rebates
paid
by
the
borrower.
Income
from
securities
loaned,
net
of
fees
paid
to
the
securities
lending
agent
and/or
third-party
vendor,
is
reported
separately
in
the
Statement
of
Operations.
The
Fund
bears
the
market
risk
with
respect
to any
cash collateral
investment,
securities
loaned,
and
the
risk
that
the
agent
may
default
on
its
obligations
to
the
Fund.
If
the
borrower
defaults
on
its
obligation
to
return
the
securities
loaned,
the
Fund
has
the
right
to
repurchase
the
securities
in
the
open
market
using
the
collateral
received.
The
securities
lending
agent
has
agreed
to
indemnify
the
Fund
in
the
event
of
default
by
a
third
party
borrower.
d.
Income
and
Deferred
Taxes
It
is the Fund's
policy
to
qualify
as
a
regulated
investment
company
under
the
Internal
Revenue
Code. The Fund
intends
to
distribute
to
shareholders
substantially
all
of
its
taxable
income
and
net
realized
gains
to
relieve
it
from
federal
income
and excise
taxes.
As
a
result,
no
provision
for
U.S.
federal
income
taxes
is
required.
The
Fund
may
be
subject
to
foreign
taxation
related
to
income
received,
capital
gains
on
the
sale
of
securities
and
certain
foreign
currency
transactions
in
the
foreign
jurisdictions
in
which it
invests.
Foreign
taxes,
if
any,
are
recorded
based
on
the
tax
regulations
and
rates
that
exist
in
the
foreign
markets
in
which
the
Fund
invests.
When
a
capital
gain
tax
is
determined
to
apply,
the
Fund
records
an
estimated
deferred
tax
liability
in
an
amount
that
would
be
payable
if
the
securities
were
disposed
of
on
the
valuation
date.
As
a
result
of
several
court
cases,
in
certain
countries
across
the
European
Union, the
Fund
filed
additional
tax
reclaims
for
previously
withheld
taxes
on
dividends
earned
in
those
countries
(EU
reclaims). Income
recognized,
if
any,
for
EU
reclaims
is
reflected
as
other
income
in
the
Statement
of
Operations
and
any
related
receivable,
if
any,
is
reflected
as
European
Union
tax
reclaims
in
the
Statement
of
Assets
and
Liabilities.
Any
fees
associated
with
these
filings
are
reflected
in
other
expenses
in
the
Statement
of
Operations.
When
uncertainty
exists
as
to
the
ultimate
resolution
of
these
proceedings,
the
likelihood
of
receipt
of
these
EU
reclaims,
and
the
potential
timing
of
payment,
no
amounts
are
reflected
in
the
financial
statements.
For
U.S.
income
tax
purposes,
EU
reclaims
received
by
the
Fund,
if
any,
reduce
the
amount
of
foreign
taxes
Fund
shareholders
can
use
as
tax
deductions
or credits
on
their
income
tax
returns.
The
Fund
may
recognize
an
income
tax
liability
related
to
its
uncertain
tax
positions
under
U.S.
GAAP
when
the
uncertain
tax
position
has
a
less
than
50%
probability
that
it
will
be
sustained
upon
examination
by
the
tax
authorities
based
on
its
technical
merits.
As
of
April
30,
2022,
the
Fund
has
determined
that
no
tax
liability
is
required
in
its
financial
statements
related
to
uncertain
tax
positions
for
any
open
tax
years
(or
expected
to
be
taken
in
future
tax
years).
Open
tax
years
are
those
that
remain
subject
to
examination
and
are
based
on
the
statute
of
limitations
in
each
jurisdiction
in
which
the
Fund
invests. 
e.
Security
Transactions,
Investment
Income,
Expenses
and
Distributions
Security
transactions
are
accounted
for
on
trade
date.
Realized
gains
and
losses
on
security
transactions
are
determined
on
a
specific
identification
basis.
Estimated
expenses
are
accrued
daily.
Dividend
income
is
recorded
on
the
ex-dividend
date.
Distributions
to shareholders
are
recorded
on
the
ex-dividend
date.
Distributable
earnings
are
determined
according
to
income
tax
regulations
(tax
basis)
and
may
differ
from
earnings
recorded
in
accordance
with
U.S.
GAAP.
These
differences
may
be
permanent
or
temporary.
Permanent
differences
are
reclassified
among
1.
Organization
and
Significant
Accounting
Policies
(continued)
b.
Joint
Repurchase
Agreement
(continued)
Franklin
Real
Estate
Securities
Trust
Notes
to
Financial
Statements
22
franklintempleton.com
Annual
Report
Franklin
Real
Estate
Securities
Fund
(continued)
capital
accounts
to
reflect
their
tax
character.
These
reclassifications
have
no
impact
on
net
assets
or
the
results
of
operations.
Temporary
differences
are
not
reclassified,
as
they
may
reverse
in
subsequent
periods.
Realized
and
unrealized
gains
and
losses
and
net
investment
income,
excluding
class
specific
expenses,
are
allocated
daily
to
each
class
of
shares
based
upon
the
relative
proportion
of
net
assets
of
each
class.
Differences
in
per
share
distributions
by
class
are
generally
due
to
differences
in
class
specific
expenses.
Distributions
received
by
the
Fund
from
certain
securities
may
be
a
return
of
capital
(ROC).
Such
distributions
reduce
the
cost
basis
of
the
securities,
and
any
distributions
in
excess
of
the
cost
basis
are
recognized
as
capital
gains.
For
U.S.
Real
Estate
Investment
Trust
(REIT)
securities,
the
Fund
records
ROC
estimates,
if
any,
on
the
ex-dividend
date
and
are
adjusted
once
actual
tax
designations
are
known.
f.
Accounting
Estimates
The
preparation
of
financial
statements
in
accordance
with
U.S.
GAAP
requires
management
to
make
estimates
and
assumptions
that
affect
the
reported
amounts
of
assets
and
liabilities
at
the
date
of
the
financial
statements
and
the
amounts
of
income
and
expenses
during
the
reporting
period.
Actual
results
could
differ
from
those
estimates.
g.
Guarantees
and
Indemnifications
Under
the
Fund's
organizational
documents,
its
officers
and
trustees
are
indemnified
by
the
Fund
against
certain
liabilities
arising
out
of
the
performance
of
their
duties
to
the
Fund.
Additionally,
in
the
normal
course
of
business,
the
Fund
enters
into
contracts
with
service
providers
that
contain
general
indemnification
clauses.
The
Fund's
maximum
exposure
under
these
arrangements
is
unknown
as
this
would
involve
future
claims
that
may
be
made
against
the
Fund
that
have
not
yet
occurred.
Currently,
the
Fund
expects
the
risk
of
loss
to
be
remote.
2.
Shares
of
Beneficial
Interest
At
April
30,
2022,
there
were
an
unlimited
number
of
shares
authorized
(without
par
value).
Transactions
in
the
Fund’s
shares
were
as
follows:
Year
Ended
April
30,
2022
Year
Ended
April
30,
2021
Shares
Amount
Shares
Amount
Class
A
Shares:
Shares
sold
a
...................................
2,789,991
$62,678,839
1,894,947
$34,950,383
Shares
issued
in
reinvestment
of
distributions
..........
860,916
19,668,835
1,232,022
21,987,838
Shares
redeemed
...............................
(2,580,965)
(57,596,754)
(4,157,045)
(75,714,739)
Net
increase
(decrease)
..........................
1,069,942
$24,750,920
(1,030,076)
$(18,776,518)
Class
C
Shares:
Shares
sold
...................................
220,838
$4,560,881
160,550
$2,776,472
Shares
issued
in
reinvestment
of
distributions
..........
46,898
999,863
108,268
1,812,201
Shares
redeemed
a
..............................
(634,154)
(13,260,093)
(810,908)
(13,920,675)
Net
increase
(decrease)
..........................
(366,418)
$(7,699,349)
(542,090)
$(9,332,002)
Class
R6
Shares:
Shares
sold
...................................
507,676
$11,522,861
1,491,363
$26,583,394
Shares
issued
in
reinvestment
of
distributions
..........
37,859
881,860
29,591
536,694
Shares
redeemed
...............................
(414,730)
(9,540,870)
(166,379)
(3,120,976)
Net
increase
(decrease)
..........................
130,805
$2,863,851
1,354,575
$23,999,112
1.
Organization
and
Significant
Accounting
Policies
(continued)
e.
Security
Transactions,
Investment
Income,
Expenses
and
Distributions
(continued)
Franklin
Real
Estate
Securities
Trust
Notes
to
Financial
Statements
23
franklintempleton.com
Annual
Report
Franklin
Real
Estate
Securities
Fund
(continued)
3.
Transactions
with
Affiliates
Franklin
Resources,
Inc.
is
the
holding
company
for
various
subsidiaries
that
together
are
referred
to
as
Franklin
Templeton.
Certain
officers
and
trustees
of
the
Trust
are
also
officers
and/or
directors
of
the
following
subsidiaries:
a.
Management
Fees
The
Fund
pays
an
investment
management
fee,
calculated
daily
and
paid
monthly,
to
Advisers
based
on
the
average
daily
net
assets
of
the
Fund
as
follows:
For
the
year
ended
April
30,
2022,
the
gross
effective
investment
management
fee
rate
was
0.502%
of
the
Fund’s
average
daily
net
assets. 
b.
Administrative
Fees
Under
an
agreement
with
Advisers,
FT
Services
provides
administrative
services
to
the
Fund.
The
fee
is
paid
by
Advisers
based
on
the
Fund’s
average
daily
net
assets,
and
is
not
an
additional
expense
of
the
Fund.
Year
Ended
April
30,
2022
Year
Ended
April
30,
2021
Shares
Amount
Shares
Amount
Advisor
Class
Shares:
Shares
sold
...................................
424,035
$9,575,910
1,161,935
$21,382,950
Shares
issued
in
reinvestment
of
distributions
..........
98,657
2,290,254
167,142
3,026,574
Shares
redeemed
...............................
(894,097)
(19,502,838)
(1,922,269)
(35,879,508)
Net
increase
(decrease)
..........................
(371,405)
$(7,636,674)
(593,192)
$(11,469,984)
a
May
include
a
portion
of
Class
C
shares
that
were
automatically
converted
to
Class
A.
Subsidiary
Affiliation
Franklin
Advisers,
Inc.
(Advisers)
Investment
manager
Franklin
Templeton
Services,
LLC
(FT
Services)
Administrative
manager
Franklin
Distributors,
LLC
(Distributors)
Principal
underwriter
Franklin
Templeton
Investor
Services,
LLC
(Investor
Services)
Transfer
agent
Annualized
Fee
Rate
Net
Assets
0.625%
Up
to
and
including
$100
million
0.500%
Over
$100
million,
up
to
and
including
$250
million
0.450%
Over
$250
million,
up
to
and
including
$7.5
billion
0.440%
Over
$7.5
billion,
up
to
and
including
$10
billion
0.430%
Over
$10
billion,
up
to
and
including
$12.5
billion
0.420%
Over
$12.5
billion,
up
to
and
including
$15
billion
0.400%
In
excess
of
$15
billion
2.
Shares
of
Beneficial
Interest
(continued)
Franklin
Real
Estate
Securities
Trust
Notes
to
Financial
Statements
24
franklintempleton.com
Annual
Report
Franklin
Real
Estate
Securities
Fund
(continued)
c.
Distribution
Fees
The
Board
has
adopted
distribution
plans
for
each
share
class,
with
the
exception
of
Class
R6
and
Advisor
Class
shares,
pursuant
to
Rule
12b-1
under
the
1940
Act.
Under
the
Fund’s
Class A reimbursement
distribution
plan,
the
Fund
reimburses
Distributors
for
costs
incurred
in
connection
with
the
servicing,
sale
and
distribution
of
the
Fund's
shares
up
to
the
maximum
annual
plan
rate.
Under
the
Class
A
reimbursement
distribution
plan,
costs
exceeding
the
maximum
for
the
current
plan
year
cannot
be
reimbursed
in
subsequent
periods.
In
addition,
under
the
Fund’s
Class C
compensation
distribution
plan,
the
Fund
pays
Distributors
for
costs
incurred
in
connection
with
the
servicing,
sale
and
distribution
of
the
Fund's
shares
up
to
the
maximum
annual
plan
rate
for
each
class.
The
plan
year,
for
purposes
of
monitoring
compliance
with
the
maximum
annual
plan
rate,
is
February
1
through
January
31.
The
maximum
annual
plan
rates,
based
on
the
average
daily
net
assets,
for
each
class,
are
as
follows:
d.
Sales
Charges/Underwriting
Agreements
Front-end
sales
charges
and
contingent
deferred
sales
charges
(CDSC)
do
not
represent
expenses
of
the
Fund.
These
charges
are
deducted
from
the
proceeds
of
sales
of
Fund
shares
prior
to
investment
or
from
redemption
proceeds
prior
to
remittance,
as
applicable.
Distributors
has
advised
the
Fund
of
the
following
commission
transactions
related
to
the
sales
and
redemptions
of
the
Fund's
shares
for
the
year:
e.
Transfer
Agent
Fees
Each
class
of
shares pays
transfer
agent
fees
to
Investor
Services
for
its
performance
of
shareholder
servicing
obligations.
The
fees
are
based
on
an
annualized
asset
based
fee
of
0.02%
plus
a
transaction
based
fee.
In
addition,
each
class reimburses
Investor
Services
for
out
of
pocket
expenses
incurred
and,
except
for
Class
R6,
reimburses
shareholder
servicing
fees
paid
to
third
parties.
These
fees
are
allocated
daily
based
upon
their
relative
proportion
of
such
classes'
aggregate
net
assets.
Class
R6
pays
Investor
Services
transfer
agent
fees
specific
to
that
class.
For
the
year
ended
April
30,
2022,
the
Fund
paid
transfer
agent
fees
of
$1,316,521,
of
which $386,683
was
retained
by
Investor
Services.
f.
Investments
in
Affiliated
Management
Investment
Companies
The
Fund
invests
in
one
or
more
affiliated
management
investment
companies.
As
defined
in
the
1940
Act,
an
investment
is
deemed
to
be
a
“Controlled
Affiliate”
of
a
fund
when
a
fund
owns,
either
directly
or
indirectly,
25%
or
more
of
the
affiliated
fund’s
outstanding
shares
or
has
the
power
to
exercise
control
over
management
or
policies
of
such
fund.
The
Fund
does
not
invest
for
purposes
of
exercising
a
controlling
influence
over
the
management
or
policies.
Management
fees
paid
by
the
Fund
are
waived
on
assets
invested
in
the
affiliated
management
investment
companies,
as
noted
in
the
Statement
of
Operations,
in
an
amount
not
to
exceed
the
management
and
administrative
fees
paid
directly
or
indirectly
by
each
affiliate.
During
the
year
ended
April
30,
2022,
the
Fund
held
investments
in
affiliated
management
investment
companies
as
follows:
Class
A
....................................................................................
0.25%
Class
C
....................................................................................
1.00%
Sales
charges
retained
net
of
commissions
paid
to
unaffiliated
brokers/dealers
..............................
$39,782
CDSC
retained
..............................................................................
$2,547
3.
Transactions
with
Affiliates
(continued)
Franklin
Real
Estate
Securities
Trust
Notes
to
Financial
Statements
25
franklintempleton.com
Annual
Report
Franklin
Real
Estate
Securities
Fund
(continued)
g.
Waiver
and
Expense
Reimbursements
Investor
Services
has
contractually
agreed
in
advance
to
waive
or
limit
its
fees
so
that
the
Class
R6
transfer
agent
fees
do
not
exceed
0.03%
based
on
the
average
net
assets
of
the
class
until
August
31,
2022.
4.
Expense
Offset
Arrangement
The Fund has
entered
into
an
arrangement
with
its
custodian
whereby
credits
realized
as
a
result
of
uninvested
cash
balances
are
used
to
reduce
a
portion
of
the
Fund's
custodian
expenses.
During
the
year
ended
April
30,
2022,
there
were
no
credits
earned. 
5.
Income
Taxes
The
tax
character
of
distributions
paid
during
the
years
ended
April
30,
2022
and
2021,
was
as
follows:
At
April
30,
2022,
the
cost
of
investments,
net
unrealized
appreciation
(depreciation),
undistributed
ordinary
income
and
undistributed
long
term
capital
gains
for
income
tax
purposes
were
as
follows:
    aa
Value
at
Beginning
of
Year
Purchases
Sales
Realized
Gain
(Loss)
Net
Change
in
Unrealized
Appreciation
(Depreciation)
Value
at
End
of
Year
Number
of
Shares
Held
at
End
of
Year
Investment
Income
a      
a  
a  
a  
a  
a  
a  
a  
Franklin
Real
Estate
Securities
Fund
Non-Controlled
Affiliates
Dividends
Institutional
Fiduciary
Trust
-
Money
Market
Portfolio,
0.0
2
4%
$
2,173,280
$
42,587,579
$
(44,760,834)
$
$
$
25
25
$
297
Non-Controlled
Affiliates
Income
from
securities
loaned
Institutional
Fiduciary
Trust
-
Money
Market
Portfolio,
0.0
2
4%
$—
$4,484,000
$(4,159,000)
$—
$—
$325,000
325,000
$23
Total
Affiliated
Securities
...
$2,173,280
$47,071,579
$(48,919,834)
$—
$—
$325,025
$320
2022
2021
Distributions
paid
from:
Ordinary
income
..........................................................
$6,599,260
$4,189,809
Long
term
capital
gain
......................................................
20,640,602
26,430,672
$27,239,862
$30,620,481
Cost
of
investments
..........................................................................
$300,947,333
Unrealized
appreciation
........................................................................
$191,003,410
Unrealized
depreciation
........................................................................
(13,519,845)
Net
unrealized
appreciation
(depreciation)
..........................................................
$177,483,565
3.
Transactions
with
Affiliates
(continued)
f.
Investments
in
Affiliated
Management
Investment
Companies
(continued)
Franklin
Real
Estate
Securities
Trust
Notes
to
Financial
Statements
26
franklintempleton.com
Annual
Report
Franklin
Real
Estate
Securities
Fund
(continued)
Differences
between
income
and/or
capital
gains
as
determined
on
a
book
basis
and
a
tax
basis
are
primarily
due
to
differing
treatments
of
corporate
actions
and
wash
sales.
6.
Investment
Transactions
Purchases
and
sales
of
investments
(excluding
short
term
securities)
for
the
year
ended
April
30,
2022,
aggregated
$104,750,588,
and
$112,007,500,
respectively.
At
April
30,
2022,
in
connection
with
securities
lending
transactions,
the
Fund
loaned
equity
investments
and
received $407,266
of
cash
collateral.
The
gross
amount
of
recognized
liability
for
such
transactions
is
included
in
payable
upon
return
of
securities
loaned
in
the
Statement
of
Assets
and
Liabilities.
The
agreements
can
be
terminated
at
any
time.
7.
Concentration
of
Risk
The
Fund
invests
a
large
percentage
of
its
total
assets
in
REIT
securities.
Such
concentration
may
subject
the
Fund
to
special
risks
associated
with
real
estate
securities.
These
securities
may
be
more
sensitive
to
economic
or
regulatory
developments
due
to
a
variety
of
factors
such
as
local,
regional,
national
and
global
economic
conditions,
interest
rates
and
tax
considerations. 
8.
Geopolitical
Risk 
On
February
24,
2022,
Russia
engaged
in
military
actions
in
the
sovereign
territory
of
Ukraine.
The
current
political
and
financial
uncertainty
surrounding
Russia
and
Ukraine
may
increase
market
volatility
and
the
economic
risk
of
investing
in
securities
in
these
countries
and
may
also
cause
uncertainty
for
the
global
economy
and
broader
financial
markets.
The
ultimate
fallout
and
long-term
impact
from
these
events
are
not
known.
The
Fund
will
continue
to
assess
the
impact
on
valuations
and
liquidity
and
will
take
any
potential
actions
needed
in
accordance
with
procedures
approved
by
the
Board.
9.
Novel
Coronavirus
Pandemic 
The
global
outbreak
of
the
novel
coronavirus
disease,
known
as
COVID-19, has
caused
adverse
effects
on
many
companies,
sectors,
nations,
regions
and
the
markets
in
general, and
may
continue for
an unpredictable duration.
The
effects
of
this
pandemic
may
materially
impact
the
value
and
performance
of
the Fund, its ability
to
buy
and
sell
fund
investments
at
appropriate
valuations
and its ability
to
achieve its investment
objectives.
10.
Credit
Facility
The
Fund,
together
with
other
U.S.
registered
and
foreign
investment
funds
(collectively,
Borrowers),
managed
by
Franklin
Templeton,
are
borrowers
in
a
joint
syndicated
senior
unsecured
credit
facility
totaling
$2.675
billion
(Global
Credit
Facility)
which
matures
on
February
3,
2023.
This
Global
Credit
Facility
provides
a
source
of
funds
to
the
Borrowers
for
temporary
and
emergency
purposes,
including
the
ability
to
meet
future
unanticipated
or
unusually
large
redemption
requests.
Distributable
earnings:
Undistributed
ordinary
income
...................................................................
$782,708
Undistributed
long
term
capital
gains
..............................................................
$6,520,474
Total
distributable
earnings
.....................................................................
$7,303,182
5.
Income
Taxes
(continued)
Franklin
Real
Estate
Securities
Trust
Notes
to
Financial
Statements
27
franklintempleton.com
Annual
Report
Franklin
Real
Estate
Securities
Fund
(continued)
Under
the
terms
of
the
Global
Credit
Facility,
the
Fund
shall,
in
addition
to
interest
charged
on
any
borrowings
made
by
the
Fund
and
other
costs
incurred
by
the
Fund,
pay
its
share
of
fees
and
expenses
incurred
in
connection
with
the
implementation
and
maintenance
of
the
Global
Credit
Facility,
based
upon
its
relative
share
of
the
aggregate
net
assets
of
all
of
the
Borrowers,
including
an
annual
commitment
fee
of
0.15%
based
upon
the
unused
portion
of
the
Global
Credit
Facility.
These
fees
are
reflected
in
other
expenses
in
the
Statement
of
Operations.
During
the
year
ended
April
30,
2022,
the Fund
did
not
use
the
Global
Credit
Facility.
11.
Fair
Value
Measurements
The
Fund
follows
a
fair
value
hierarchy
that
distinguishes
between
market
data
obtained
from
independent
sources
(observable
inputs)
and
the Fund's
own
market
assumptions
(unobservable
inputs).
These
inputs
are
used
in
determining
the
value
of
the
Fund's financial
instruments
and
are
summarized
in
the
following
fair
value
hierarchy:
Level
1
quoted
prices
in
active
markets
for
identical
financial
instruments
Level
2
other
significant
observable
inputs
(including
quoted
prices
for
similar
financial
instruments,
interest
rates,
prepayment
speed,
credit
risk,
etc.)
Level
3
significant
unobservable
inputs
(including
the
Fund's
own
assumptions
in
determining
the
fair
value
of
financial
instruments)
The
input
levels
are
not
necessarily
an
indication
of
the
risk
or
liquidity
associated
with
financial
instruments
at
that
level.
A
summary
of
inputs
used
as
of
April
30,
2022,
in
valuing
the
Funds'
assets
and
liabilities
carried
at
fair
value,
is
as
follows:
12.
Subsequent
Events
The
Fund
has
evaluated
subsequent
events
through
the
issuance
of
the financial
statements
and
determined
that
no
events
have
occurred
that
require
disclosure.
Abbreviations
Level
1
Level
2
Level
3
Total
Franklin
Real
Estate
Securities
Fund
Assets:
Investments
in
Securities:
a
Common
Stocks
........................
$
478,023,607
$
$
$
478,023,607
Short
Term
Investments
...................
325,025
82,266
407,291
Total
Investments
in
Securities
...........
$478,348,632
$82,266
$—
$478,430,898
a
For
detailed
categories,
see
the
accompanying
schedule
of
investments.
Selected
Portfolio
REIT
Real
Estate
Investment
Trust
10.
Credit
Facility
(continued)
Franklin
Real
Estate
Securities
Trust
Report
of
Independent
Registered
Public
Accounting
Firm
28
franklintempleton.com
Annual
Report
To
the
Board
of
Trustees
of
Franklin
Real
Estate
Securities
Trust
and
Shareholders
of
Franklin
Real
Estate
Securities
Fund
Opinion
on
the
Financial
Statements
We
have
audited
the
accompanying
statement
of
assets
and
liabilities,
including
the
schedule
of
investments,
of
Franklin
Real
Estate
Securities
Fund
(the
"Fund")
as
of
April
30,
2022,
the
related
statement
of
operations
for
the
year
ended
April
30,
2022,
the
statement
of
changes
in
net
assets
for
each
of
the
two
years
in
the
period
ended
April
30,
2022,
including
the
related
notes,
and
the
financial
highlights
for
each
of
the
five
years
in
the
period
ended
April
30,
2022
(collectively
referred
to
as
the
“financial
statements”).
In
our
opinion,
the
financial
statements
present
fairly,
in
all
material
respects,
the
financial
position
of
the
Fund
as
of
April
30,
2022,
the
results
of
its
operations
for
the
year
then
ended,
the
changes
in
its
net
assets
for
each
of
the
two
years
in
the
period
ended
April
30,
2022
and
the
financial
highlights
for
each
of
the
five
years
in
the
period
ended
April
30,
2022
in
conformity
with
accounting
principles
generally
accepted
in
the
United
States
of
America.
Basis
for
Opinion
These
financial
statements
are
the
responsibility
of
the
Fund’s
management.
Our
responsibility
is
to
express
an
opinion
on
the
Fund’s
financial
statements
based
on
our
audits.
We
are
a
public
accounting
firm
registered
with
the
Public
Company
Accounting
Oversight
Board
(United
States)
(PCAOB)
and
are
required
to
be
independent
with
respect
to
the
Fund
in
accordance
with
the
U.S.
federal
securities
laws
and
the
applicable
rules
and
regulations
of
the
Securities
and
Exchange
Commission
and
the
PCAOB.
We
conducted
our
audits
of
these
financial
statements
in
accordance
with
the
standards
of
the
PCAOB.
Those
standards
require
that
we
plan
and
perform
the
audit
to
obtain
reasonable
assurance
about
whether
the
financial
statements
are
free
of
material
misstatement,
whether
due
to
error
or
fraud.
Our
audits
included
performing
procedures
to
assess
the
risks
of
material
misstatement
of
the
financial
statements,
whether
due
to
error
or
fraud,
and
performing
procedures
that
respond
to
those
risks.
Such
procedures
included
examining,
on
a
test
basis,
evidence
regarding
the
amounts
and
disclosures
in
the
financial
statements.
Our
audits
also
included
evaluating
the
accounting
principles
used
and
significant
estimates
made
by
management,
as
well
as
evaluating
the
overall
presentation
of
the
financial
statements.
Our
procedures
included
confirmation
of
securities
owned
as
of
April
30,
2022
by
correspondence
with
the
custodian,
transfer
agent
and
brokers;
when
replies
were
not
received
from
brokers,
we
performed
other
auditing
procedures.
We
believe
that
our
audits
provide
a
reasonable
basis
for
our
opinion.
PricewaterhouseCoopers
LLP
San
Francisco,
California
June
16,
2022
We
have
served
as
the
auditor
of
one
or
more
investment
companies
in
the
Franklin
Templeton
Group
of
Funds
since
1948.
Franklin
Real
Estate
Securities
Trust
Tax
Information
(unaudited)
29
franklintempleton.com
Annual
Report
Franklin
Real
Estate
Securities
Fund
By
mid-February,
tax
information
related
to
a
shareholder's
proportionate
share
of
distributions
paid
during
the
preceding
calendar
year
will
be
received,
if
applicable.
Please
also
refer
to
www.franklintempleton.com
for
per
share
tax
information
related
to
any
distributions
paid
during
the
preceding
calendar
year.
Shareholders
are
advised
to
consult
with
their
tax
advisors
for
further
information
on
the
treatment
of
these
amount
s
on
their
tax
returns.
The
following
tax
information
for
the
Fund
is
required
to
be
furnished
to
shareholders
with
respect
to
income
earned
and
distributions
paid
during
its
fiscal
year.
The
Fund
hereby
reports
the
following
amounts,
or
if
subsequently
determined
to
be
different,
the
maximum
allowable
amounts,
for
the
fiscal
year
ended
April
30,
2022:
Pursuant
to:
Amount
Reported
Long-Term
Capital
Gain
Dividends
Distributed
§852(b)(3)(C)
$20,640,602
Short-Term
Capital
Gain
Dividends
Distributed
§871(k)(2)(C)
$3,951,689
Qualified
Business
Income
Dividends
Earned
§199A
$7,499,163
Franklin
Real
Estate
Securities
Trust
30
franklintempleton.com
Annual
Report
Special
Meeting
of
Shareholders
November
12,
2020
and
reconvened
on
December
10,
2020
(unaudited)
A
Special
Meeting
of
Shareholders
of
Franklin
Real
Estate
Securities
Fund,
a
series
of
Franklin
Real
Estate
Securities
Trust,
was
held
virtually
on
November
12,
2020
and
reconvened
on
December
10,
2020.
The
purpose
of
the
meeting
was
to
approve
(1)
a
new
Investment
Management
Agreement
with
Franklin
Advisers,
Inc.;
(2)
change
in
the
Fund’s
classification
from
a
diversified
to
a
non-diversified
fund;
(3)
the
use
of
a
“manager
of
managers”
structure;
and
(4)
an
amended
fundamental
investment
restriction
regarding
investments
in
commodities.
At
the
meeting
all
proposals
were
passed.
No
other
business
was
transacted
at
the
meeting
with
respect
to
the
Fund.
The
results
of
the
voting
at
the
meeting
are
as
follows:
1.
To
approve
a
new
Investment
Management
Agreement
with
Franklin
Advisers,
Inc.:
2.
To
approve
a
change
in
the
Fund’s
classification
from
a
diversified
to
a
non-diversified
fund:
3.
To
approve
the
use
of
a
“manager
of
managers”
structure:
4.
To
approve
an
amended
fundamental
investment
restriction
regarding
investments
in
commodities:
For
%
Voted
FOR
%
FOR
of
Outstanding
Shares
9,382,224
87.64%
44.25%
Against
%
Voted
Against
%
Against
of
Outstanding
Shares
306,497
2.86%
1.45%
Abstain
%
Voted
Abstain
%
Abstain
of
Outstanding
Shares
1,016,364
9.49%
4.79%
For
%
Voted
FOR
%
FOR
of
Outstanding
Shares
8,883,566
82.98%
41.90%
Against
%
Voted
Against
%
Against
of
Outstanding
Shares
780,414
7.29%
3.68%
Abstain
%
Voted
Abstain
%
Abstain
of
Outstanding
Shares
1,041,106
9.73%
4.91%
For
%
Voted
FOR
%
FOR
of
Outstanding
Shares
8,940,349
83.51%
42.17%
Against
%
Voted
Against
%
Against
of
Outstanding
Shares
782,499
7.31%
3.69%
Abstain
%
Voted
Abstain
%
Abstain
of
Outstanding
Shares
982,235
9.18%
4.63%
For
%
Voted
FOR
%
FOR
of
Outstanding
Shares
9,038,343
84.43%
42.63%
Against
%
Voted
Against
%
Against
of
Outstanding
Shares
615,137
5.75%
2.90%
Abstain
%
Voted
Abstain
%
Abstain
of
Outstanding
Shares
1,058,207
9.89%
4.99%
Franklin
Real
Estate
Securities
Trust
Board
Members
and
Officers
31
franklintempleton.com
Annual
Report
The
name,
year
of
birth
and
address
of
the
officers
and
board
members,
as
well
as
their
affiliations,
positions
held
with
the
Trust,
principal
occupations
during
at
least
the
past
five
years
and
number
of
U.S.
registered
portfolios
overseen
in
the
Franklin
Templeton/Legg
Mason
Investments
fund
complex,
are
shown
below.
Generally,
each
board
member
serves
until
that
person’s
successor
is
elected
and
qualified.
Independent
Board
Members
Name,
Year
of
Birth
and
Address
Position
Length
of
Time
Served
Number
of
Portfolios
in
Fund
Complex
Overseen
by
Board
Member*
Other
Directorships
Held
During
at
Least
the
Past
5
Years
Harris
J.
Ashton
(1932)
Trustee
Since
1993
119
Bar-S
Foods
(meat
packing
company)
(1981-2010).
One
Franklin
Parkway
San
Mateo,
CA
94403-1906
Principal
Occupation
During
at
Least
the
Past
5
Years:
Director
of
various
companies;
and
formerly
,
Director,
RBC
Holdings,
Inc.
(bank
holding
company)
(until
2002);
and
President,
Chief
Executive
Officer
and
Chairman
of
the
Board,
General
Host
Corporation
(nursery
and
craft
centers)
(until
1998).
Terrence
J.
Checki
(1945)
Trustee
Since
2017
100
Hess
Corporation
(exploration
of
oil
and
gas)
(2014-present).
One
Franklin
Parkway
San
Mateo,
CA
94403-1906
Principal
Occupation
During
at
Least
the
Past
5
Years:
Member
of
the
Council
on
Foreign
Relations
(1996-present);
Member
of
the
National
Committee
on
U.S.-China
Relations
(1999-present);
member
of
the
board
of
trustees
of
the
Economic
Club
of
New
York
(2013-present);
member
of
the
board
of
trustees
of
the
Foreign
Policy
Association
(2005-present);
member
of
the
board
of
directors
of
Council
of
the
Americas
(2007-present)
and
the
Tallberg
Foundation
(2018-present);
and
formerly
,
Executive
Vice
President
of
the
Federal
Reserve
Bank
of
New
York
and
Head
of
its
Emerging
Markets
and
Internal
Affairs
Group
and
Member
of
Management
Committee
(1995-2014);
and
Visiting
Fellow
at
the
Council
on
Foreign
Relations
(2014).
Mary
C.
Choksi
(1950)
Trustee
Since
2014
120
Omnicom
Group
Inc.
(advertising
and
marketing
communications
services)
(2011-present)
and
White
Mountains
Insurance
Group,
Ltd.
(holding
company)
(2017-present);
and
formerly
,
Avis
Budget
Group
Inc.
(car
rental)
(2007-2020).
One
Franklin
Parkway
San
Mateo,
CA
94403-1906
Principal
Occupation
During
at
Least
the
Past
5
Years:
Director
of
various
companies;
and
formerly
,
Founder
and
Senior
Advisor,
Strategic
Investment
Group
(investment
management
group)
(2015-2017);
Founding
Partner
and
Senior
Managing
Director,
Strategic
Investment
Group
(1987-2015);
Founding
Partner
and
Managing
Director,
Emerging
Markets
Management
LLC
(investment
management
firm)
(1987-2011);
and
Loan
Officer/Senior
Loan
Officer/Senior
Pension
Investment
Officer,
World
Bank
Group
(international
financial
institution)
(1977-1987).
Franklin
Real
Estate
Securities
Trust
32
franklintempleton.com
Annual
Report
Name,
Year
of
Birth
and
Address
Position
Length
of
Time
Served
Number
of
Portfolios
in
Fund
Complex
Overseen
by
Board
Member*
Other
Directorships
Held
During
at
Least
the
Past
5
Years
Edith
E.
Holiday
(1952)
Lead
Independent
Trustee
Trustee
since
2005
and
Lead
Independent
Trustee
since
2019
120
Hess
Corporation
(exploration
of
oil
and
gas)
(1993-present),
Santander
Consumer
USA
Holdings,
Inc.
(consumer
finance)
(2016-present);
Santander
Holdings
USA
(holding
company)
(2019-present);
and
formerly
,
Canadian
National
Railway
(railroad)
(2001-2021),
White
Mountains
Insurance
Group,
Ltd.
(holding
company)
(2004-
2021),
RTI
International
Metals,
Inc.
(manufacture
and
distribution
of
titanium)
(1999-2015)
and
H.J.
Heinz
Company
(processed
foods
and
allied
products)
(1994-2013).
One
Franklin
Parkway
San
Mateo,
CA
94403-1906
Principal
Occupation
During
at
Least
the
Past
5
Years:
Director
or
Trustee
of
various
companies
and
trusts;
and
formerly
,
Assistant
to
the
President
of
the
United
States
and
Secretary
of
the
Cabinet
(1990-1993);
General
Counsel
to
the
United
States
Treasury
Department
(1989-1990);
and
Counselor
to
the
Secretary
and
Assistant
Secretary
for
Public
Affairs
and
Public
Liaison-United
States
Treasury
Department
(1988-1989).
J.
Michael
Luttig
(1954)
Trustee
Since
2009
120
Boeing
Capital
Corporation
(aircraft
financing)
(2006-2010).
One
Franklin
Parkway
San
Mateo,
CA
94403-1906
Principal
Occupation
During
at
Least
the
Past
5
Years:
Counselor
and
Special
Advisor
to
the
CEO
and
Board
of
Directors
of
the
Coca-Cola
Company
(beverage
company)
(2021-present);
and
formerly
,
Counselor
and
Senior
Advisor
to
the
Chairman,
CEO,
and
Board
of
Directors,
of
The
Boeing
Company
(aerospace
company),
and
member
of
the
Executive
Council
(2019-2020);
Executive
Vice
President,
General
Counsel
and
member
of
the
Executive
Council,
The
Boeing
Company
(2006-2019);
and
Federal
Appeals
Court
Judge,
United
States
Court
of
Appeals
for
the
Fourth
Circuit
(1991-2006).
Larry
D.
Thompson
(1945)
Trustee
Since
2007
120
Graham
Holdings
Company
(education
and
media
organization)
(2011-2021);
The
Southern
Company
(energy
company)
(2014-2020;
previously
2010-
2012)
and
Cbeyond,
Inc.
(business
communications
provider)
(2010-
2012).
One
Franklin
Parkway
San
Mateo,
CA
94403-1906
Principal
Occupation
During
at
Least
the
Past
5
Years:
Director
of
various
companies;
Counsel,
Finch
McCranie,
LLP
(law
firm)
(2015-present);
John
A.
Sibley
Professor
of
Corporate
and
Business
Law,
University
of
Georgia
School
of
Law
(2015-present;
previously
2011-2012);
and
formerly
,
Independent
Compliance
Monitor
and
Auditor,
Volkswagen
AG
(manufacturer
of
automobiles
and
commercial
vehicles)
(2017-2020);
Executive
Vice
President
-
Government
Affairs,
General
Counsel
and
Corporate
Secretary,
PepsiCo,
Inc.
(consumer
products)
(2012-2014);
Senior
Vice
President
-
Government
Affairs,
General
Counsel
and
Secretary,
PepsiCo,
Inc.
(2004-2011);
Senior
Fellow
of
The
Brookings
Institution
(2003-2004);
Visiting
Professor,
University
of
Georgia
School
of
Law
(2004);
and
Deputy
Attorney
General,
U.S.
Department
of
Justice
(2001-2003).
Independent
Board
Members
(continued)
Franklin
Real
Estate
Securities
Trust
33
franklintempleton.com
Annual
Report
Interested
Board
Members
and
Officers
Name,
Year
of
Birth
and
Address
Position
Length
of
Time
Served
Number
of
Portfolios
in
Fund
Complex
Overseen
by
Board
Member*
Other
Directorships
Held
During
at
Least
the
Past
5
Years
Valerie
M.
Williams
(1956)
Trustee
Since
2021
100
Omnicom
Group,
Inc.
(advertising
and
marketing
communications
services)
(2016-present),
DTE
Energy
Co.
(gas
and
electric
utility)
(2018-present),
Devon
Energy
Corporation
(exploration
and
production
of
oil
and
gas)
(2021-present);
and
formerly
,
WPX
Energy,
Inc.
(exploration
and
production
of
oil
and
gas)
(2018-
2021).
One
Franklin
Parkway
San
Mateo,
CA
94403-1906
Principal
Occupation
During
at
Least
the
Past
5
Years:
Director
of
various
companies;
and
formerly
,
Regional
Assurance
Managing
Partner,
Ernst
&
Young
LLP
(public
accounting)
(2005-2016),
various
roles
of
increasing
responsibility
at
Ernst
&
Young
(1981-2005).
Name,
Year
of
Birth
and
Address
Position
Length
of
Time
Served
Number
of
Portfolios
in
Fund
Complex
Overseen
by
Board
Member*
Other
Directorships
Held
During
at
Least
the
Past
5
Years
**Gregory
E.
Johnson
(1961)
Trustee
Since
2007
131
None
One
Franklin
Parkway
San
Mateo,
CA
94403-1906
Principal
Occupation
During
at
Least
the
Past
5
Years:
Executive
Chairman,
Chairman
of
the
Board
and
Director,
Franklin
Resources,
Inc.;
officer
and/or
director
or
trustee,
as
the
case
may
be,
of
some
of
the
other
subsidiaries
of
Franklin
Resources,
Inc.
and
of
certain
funds
in
the
Franklin
Templeton/Legg
Mason
fund
complex;
Vice
Chairman,
Investment
Company
Institute;
and
formerly
,
Chief
Executive
Officer
(2013-2020)
and
President
(1994-2015)
Franklin
Resources,
Inc.
**Rupert
H.
Johnson,
Jr.
(1940)
Chairman
of
the
Board
and
Trustee
Since
2013
120
None
One
Franklin
Parkway
San
Mateo,
CA
94403-1906
Principal
Occupation
During
at
Least
the
Past
5
Years:
Director
(Vice
Chairman),
Franklin
Resources,
Inc.;
Director,
Franklin
Advisers,
Inc.;
and
officer
and/or
director
or
trustee,
as
the
case
may
be,
of
some
of
the
other
subsidiaries
of
Franklin
Resources,
Inc.
and
of
certain
funds
in
the
Franklin
Templeton/Legg
Mason
fund
complex.
Alison
E.
Baur
(1964)
Vice
President
Since
2012
Not
Applicable
Not
Applicable
One
Franklin
Parkway
San
Mateo,
CA
94403-1906
Principal
Occupation
During
at
Least
the
Past
5
Years:
Deputy
General
Counsel,
Franklin
Templeton;
and
officer
of
some
of
the
other
subsidiaries
of
Franklin
Resources,
Inc.
and
of
certain
funds
in
the
Franklin
Templeton/Legg
Mason
fund
complex.
Breda
M.
Beckerle
(1958)
Chief
Compliance
Officer
Since
2020
Not
Applicable
Not
Applicable
280
Park
Avenue
New
York,
NY
10017
Principal
Occupation
During
at
Least
the
Past
5
Years:
Chief
Compliance
Officer,
Fiduciary
Investment
Management
International,
Inc.,
Franklin
Advisers,
Inc.,
Franklin
Mutual
Advisers,
LLC,
Franklin
Templeton
Institutional,
LLC;
and
officer
of
certain
funds
in
the
Franklin
Templeton/Legg
Mason
fund
complex.
Independent
Board
Members
(continued)
Franklin
Real
Estate
Securities
Trust
34
franklintempleton.com
Annual
Report
Name,
Year
of
Birth
and
Address
Position
Length
of
Time
Served
Number
of
Portfolios
in
Fund
Complex
Overseen
by
Board
Member*
Other
Directorships
Held
During
at
Least
the
Past
5
Years
Steven
J.
Gray
(1955)
Vice
President
and
Co-
Secretary
Vice
President
since
2009
and
Co-
Secretary
since
2019
Not
Applicable
Not
Applicable
One
Franklin
Parkway
San
Mateo,
CA
94403-1906
Principal
Occupation
During
at
Least
the
Past
5
Years:
Senior
Associate
General
Counsel,
Franklin
Templeton;
Assistant
Secretary,
Franklin
Distributors,
LLC;
and
officer
of
certain
funds
in
the
Franklin
Templeton/Legg
Mason
fund
complex.
Matthew
T.
Hinkle
(1971)
Chief
Executive
Officer
Finance
and
Administration
Since
2017
Not
Applicable
Not
Applicable
One
Franklin
Parkway
San
Mateo,
CA
94403-1906
Principal
Occupation
During
at
Least
the
Past
5
Years:
Senior
Vice
President,
Franklin
Templeton
Services,
LLC;
officer
of
certain
funds
in
the
Franklin
Templeton/Legg
Mason
fund
complex;
and
formerly
,
Vice
President,
Global
Tax
(2012-April
2017)
and
Treasurer/Assistant
Treasurer,
Franklin
Templeton
(2009-2017).
Susan
Kerr
(1949)
Vice
President
AML
Compliance
Since
2021
Not
Applicable
Not
Applicable
620
Eighth
Avenue
New
York,
NY
10018
Principal
Occupation
During
at
Least
the
Past
5
Years:
Senior
Compliance
Analyst,
Franklin
Templeton;
Chief
Anti-Money
Laundering
Compliance
Officer,
Legg
Mason
&
Co.,
or
its
affiliates;
Anti
Money
Laundering
Compliance
Officer;
Senior
Compliance
Officer,
LMIS;
and
officer
of
certain
funds
in
the
Franklin
Templeton/Legg
Mason
fund
complex.
Christopher
Kings
(1974)
Chief
Financial
Officer,
Chief
Accounting
Officer
and
Treasurer
Since
January
2022
Not
Applicable
Not
Applicable
One
Franklin
Parkway
San
Mateo,
CA
94403-1906
Principal
Occupation
During
at
Least
the
Past
5
Years:
Treasurer,
U.S.
Fund
Administration
&
Reporting;
and
officer
of
certain
funds
in
the
Franklin
Templeton/Legg
Mason
fund
complex.
Edward
D.
Perks
(1970)
President
and
Chief
Executive
Officer
Investment
Management
Since
2018
Not
Applicable
Not
Applicable
One
Franklin
Parkway
San
Mateo,
CA
94403-1906
Principal
Occupation
During
at
Least
the
Past
5
Years:
President
and
Director,
Franklin
Advisers,
Inc.
and
officer
of
certain
funds
in
the
Franklin
Templeton/Legg
Mason
fund
complex.
Navid
J.
Tofigh
(1972)
Vice
President
Since
2015
Not
Applicable
Not
Applicable
One
Franklin
Parkway
San
Mateo,
CA
94403-1906
Principal
Occupation
During
at
Least
the
Past
5
Years:
Senior
Associate
General
Counsel,
Franklin
Templeton;
and
officer
of
certain
funds
in
the
Franklin
Templeton/Legg
Mason
fund
complex.
Interested
Board
Members
and
Officers
(continued)
Franklin
Real
Estate
Securities
Trust
35
franklintempleton.com
Annual
Report
*We
base
the
number
of
portfolios
on
each
separate
series
of
the
U.S.
registered
investment
companies
within
the
Franklin
Templeton/Legg
Mason
fund
complex.
These
portfolios
have
a
common
investment
manager
or
affiliated
investment
managers.
**Gregory
E.
Johnson
is
considered
to
be
an
interested
person
of
the
Fund
under
the
federal
securities
laws
due
to
his
position
as
an
officer
and
director
of
Franklin
Resources,
Inc.
(Resources),
which
is
the
parent
company
of
the
Fund’s
investment
manager
and
distributor.
Rupert
H.
Johnson,
Jr.
is
considered
to
be
an
interested
person
of
the
Fund
under
the
federal
securities
laws
due
to
his
position
as
an
officer
and
director
and
major
shareholder
of
Resources.
Note
1:
Rupert
H.
Johnson,
Jr.
is
the
uncle
of
Gregory
E.
Johnson.
Note
2:
Officer
information
is
current
as
of
the
date
of
this
report.
It
is
possible
that
after
this
date,
information
about
officers
may
change.
The
Sarbanes-Oxley
Act
of
2002
and
Rules
adopted
by
the
Securities
and
Exchange
Commission
require
the
Fund
to
disclose
whether
the
Fund’s
Audit
Committee
includes
at
least
one
member
who
is
an
audit
committee
financial
expert
within
the
meaning
of
such
Act
and
Rules.
The
Fund’s
Board
has
determined
that
there
is
at
least
one
such
financial
expert
on
the
Audit
Committee
and
has
designated
Mary
C.
Choksi
as
its
audit
committee
financial
expert.
The
Board
believes
that
Ms.
Choksi
qualifies
as
such
an
expert
in
view
of
her
extensive
business
background
and
experience.
She
served
as
a
director
of
Avis
Budget
Group,
Inc.
(2007
to
2020)
and
formerly,
Founder
and
Senior
Advisor,
Strategic
Investment
Group
(1987
to
2017).
Ms.
Choksi
has
been
a
Member
of
the
Fund’s
Audit
Committee
since
2014.
As
a
result
of
such
background
and
experience,
the
Board
believes
that
Ms.
Choksi
has
acquired
an
understanding
of
generally
accepted
accounting
principles
and
financial
statements,
the
general
application
of
such
principles
in
connection
with
the
accounting
estimates,
accruals
and
reserves,
and
analyzing
and
evaluating
financial
statements
that
present
a
breadth
and
level
of
complexity
of
accounting
issues
generally
comparable
to
those
of
the
Fund,
as
well
as
an
understanding
of
internal
controls
and
procedures
for
financial
reporting
and
an
understanding
of
audit
committee
functions.
Ms.
Choksi
is
an
independent
Board
member
as
that
term
is
defined
under
the
relevant
Securities
and
Exchange
Commission
Rules
and
Releases.
The
Statement
of
Additional
Information
(SAI)
includes
additional
information
about
the
board
members
and
is
available,
without
charge,
upon
request.
Shareholders
may
call
(800)
DIAL
BEN/342-5236
to
request
the
SAI.
Name,
Year
of
Birth
and
Address
Position
Length
of
Time
Served
Number
of
Portfolios
in
Fund
Complex
Overseen
by
Board
Member*
Other
Directorships
Held
During
at
Least
the
Past
5
Years
Lori
A.
Weber
(1964)
Vice
President
and
Co-
Secretary
Vice
President
since
2011
and
Co-
Secretary
since
2019
Not
Applicable
Not
Applicable
300
S.E.
2nd
Street
Fort
Lauderdale,
FL
33301-
1923
Principal
Occupation
During
at
Least
the
Past
5
Years:
Senior
Associate
General
Counsel,
Franklin
Templeton;
Assistant
Secretary,
Franklin
Resources,
Inc.;
Vice
President
and
Secretary,
Templeton
Investment
Counsel,
LLC;
and
officer
of
certain
funds
in
the
Franklin
Templeton/Legg
Mason
fund
complex.
Interested
Board
Members
and
Officers
(continued)
Franklin
Real
Estate
Securities
Trust
Shareholder
Information
36
franklintempleton.com
Annual
Report
BOARD
APPROVAL
OF
INVESTMENT
MANAGEMENT
AGREEMENTS
FRANKLIN
REAL
ESTATE
SECURITIES
TRUST
Franklin
Real
Estate
Securities
Fund
(Fund)
At
an
in-person
meeting
held
on
April
12,
2022
(Meeting),
the
Board
of
Trustees
(Board)
of
Franklin
Real
Estate
Securities
Trust
(Trust),
including
a
majority
of
the
trustees
who
are
not
“interested
persons”
as
defined
in
the
Investment
Company
Act
of
1940
(Independent
Trustees),
reviewed
and
approved
the
continuance
of
the
existing
investment
management
agreement
between
Franklin
Advisers,
Inc.
(Manager)
and
the
Trust,
on
behalf
of
the
Fund
(Management
Agreement)
for
an
additional
one-year
period.
The
Independent
Trustees
received
advice
from
and
met
separately
with
Independent
Trustee
counsel
in
considering
whether
to
approve
the
continuation
of
the
Management
Agreement.
In
considering
the
continuation
of
the
Management
Agreement,
the
Board
reviewed
and
considered
information
provided
by
the
Manager
at
the
Meeting
and
throughout
the
year
at
meetings
of
the
Board
and
its
committees.
The
Board
also
reviewed
and
considered
information
provided
in
response
to
a
detailed
set
of
requests
for
information
submitted
to
the
Manager
by
Independent
Trustee
counsel
on
behalf
of
the
Independent
Trustees
in
connection
with
the
annual
contract
renewal
process.
In
addition,
prior
to
the
Meeting,
the
Independent
Trustees
held
a
virtual
contract
renewal
meeting
at
which
the
Independent
Trustees
first
conferred
amongst
themselves
and
Independent
Trustee
counsel
about
contract
renewal
matters;
and
then
met
with
management
to
request
additional
information
that
Independent
Trustees
reviewed
and
considered
at
the
Meeting.
The
Board
reviewed
and
considered
all
of
the
factors
it
deemed
relevant
in
approving
the
continuance
of
the
Management
Agreement,
including,
but
not
limited
to:
(i)
the
nature,
extent
and
quality
of
the
services
provided
by
the
Manager;
(ii)
the
investment
performance
of
the
Fund;
(iii)
the
costs
of
the
services
provided
and
profits
realized
by
the
Manager
and
its
affiliates
from
the
relationship
with
the
Fund;
(iv)
the
extent
to
which
economies
of
scale
are
realized
as
the
Fund
grows;
and
(v)
whether
fee
levels
reflect
these
economies
of
scale
for
the
benefit
of
Fund
investors.
In
approving
the
continuance
of
the
Management
Agreement,
the
Board,
including
a
majority
of
the
Independent
Trustees,
determined
that
the
terms
of
the
Management
Agreement
are
fair
and
reasonable
and
that
the
continuance
of
such
Management
Agreement
is
in
the
best
interests
of
the
Fund
and
its
shareholders.
While
attention
was
given
to
all
information
furnished,
the
following
discusses
some
primary
factors
relevant
to
the
Board’s
determination.
Nature,
Extent
and
Quality
of
Services
The
Board
reviewed
and
considered
information
regarding
the
nature,
extent
and
quality
of
investment
management
services
provided
by
the
Manager
and
its
affiliates
to
the
Fund
and
its
shareholders.
This
information
included,
among
other
things,
the
qualifications,
background
and
experience
of
the
senior
management
and
investment
personnel
of
the
Manager,
as
well
as
information
on
succession
planning
where
appropriate;
the
structure
of
investment
personnel
compensation;
oversight
of
third-
party
service
providers;
investment
performance
reports
and
related
financial
information
for
the
Fund;
reports
on
expenses
and
shareholder
services;
legal
and
compliance
matters;
risk
controls;
pricing
and
other
services
provided
by
the
Manager
and
its
affiliates;
and
management
fees
charged
by
the
Manager
and
its
affiliates
to
US
funds
and
other
accounts,
including
management’s
explanation
of
differences
among
accounts
where
relevant.
The
Board
also
reviewed
and
considered
an
annual
report
on
payments
made
by
Franklin
Templeton
(FT)
or
the
Fund
to
financial
intermediaries,
as
well
as
a
memorandum
relating
to
third-
party
servicing
arrangements,
which
included
discussion
of
the
changing
distribution
landscape
for
the
Fund.
The
Board
acknowledged
the
ongoing
integration
of
the
Legg
Mason
family
of
funds
into
the
FT
family
of
funds
and
developing
strategies
to
address
areas
of
heightened
concern
in
the
mutual
fund
industry,
including
various
regulatory
initiatives
and
recent
geopolitical
concerns.
The
Board
also
reviewed
and
considered
the
benefits
provided
to
Fund
shareholders
of
investing
in
a
fund
that
is
part
of
the
FT
family
of
funds.
The
Board
noted
the
financial
position
of
Franklin
Resources,
Inc.
(FRI),
the
Manager’s
parent,
and
its
commitment
to
the
mutual
fund
business
as
evidenced
by
its
reassessment
of
the
fund
offerings
in
response
to
the
market
environment
and
project
initiatives
and
capital
investments
relating
to
the
services
provided
to
the
Fund
by
the
FT
organization.
The
Board
specifically
noted
FT’s
commitment
to
being
a
global
leader
in
stewardship
and
sustainability
and
the
recent
addition
of
a
senior
executive
focused
on
environmental,
social
and
governance
and
climate
control
initiatives.
Franklin
Real
Estate
Securities
Trust
Shareholder
Information
37
franklintempleton.com
Annual
Report
Following
consideration
of
such
information,
the
Board
was
satisfied
with
the
nature,
extent
and
quality
of
services
provided
by
the
Manager
and
its
affiliates
to
the
Fund
and
its
shareholders.
Fund
Performance
The
Board
reviewed
and
considered
the
performance
results
of
the
Fund
over
various
time
periods
ended
January
31,
2022.
The
Board
considered
the
performance
returns
for
the
Fund
in
comparison
to
the
performance
returns
of
mutual
funds
deemed
comparable
to
the
Fund
included
in
a
universe
(Performance
Universe)
selected
by
Broadridge
Financial
Solutions,
Inc.
(Broadridge),
an
independent
provider
of
investment
company
data.
The
Board
received
a
description
of
the
methodology
used
by
Broadridge
to
select
the
mutual
funds
included
in
a
Performance
Universe.
The
Board
also
reviewed
and
considered
Fund
performance
reports
provided
and
discussions
that
occurred
with
portfolio
managers
at
Board
meetings
throughout
the
year.
A
summary
of
the
Fund’s
performance
results
is
below.
The
Performance
Universe
for
the
Fund
included
the
Fund
and
all
retail
and
institutional
real
estate
funds.
The
Board
noted
that
the
Fund’s
annualized
total
return
for
the
one-
and
three-year
periods
was
above
the
median
of
its
Performance
Universe,
but
for
the
five-
and
10-year
periods
was
below
the
median
of
its
Performance
Universe.
The
Board
concluded
that
the
Fund’s
performance
was
satisfactory.
Comparative
Fees
and
Expenses
The
Board
reviewed
and
considered
information
regarding
the
Fund’s
actual
total
expense
ratio
and
its
various
components,
including,
as
applicable,
management
fees;
transfer
agent
expenses;
underlying
fund
expenses;
Rule
12b-1
and
non-Rule
12b-1
service
fees;
and
other
non-
management
fees.
The
Board
also
noted
the
quarterly
and
annual
reports
it
receives
on
all
marketing
support
payments
made
by
FT
to
financial
intermediaries.
The
Board
considered
the
actual
total
expense
ratio
and,
separately,
the
contractual
management
fee
rate,
without
the
effect
of
fee
waivers,
if
any
(Management
Rate)
of
the
Fund
in
comparison
to
the
median
expense
ratio
and
median
Management
Rate,
respectively,
of
other
mutual
funds
deemed
comparable
to
and
with
a
similar
expense
structure
to
the
Fund
selected
by
Broadridge
(Expense
Group).
Broadridge
fee
and
expense
data
is
based
upon
information
taken
from
each
fund’s
most
recent
annual
or
semi-annual
report,
which
reflects
historical
asset
levels
that
may
be
quite
different
from
those
currently
existing,
particularly
in
a
period
of
market
volatility.
While
recognizing
such
inherent
limitation
and
the
fact
that
expense
ratios
and
Management
Rates
generally
increase
as
assets
decline
and
decrease
as
assets
grow,
the
Board
believed
the
independent
analysis
conducted
by
Broadridge
to
be
an
appropriate
measure
of
comparative
fees
and
expenses.
The
Broadridge
Management
Rate
includes
administrative
charges,
and
the
actual
total
expense
ratio,
for
comparative
consistency,
was
shown
for
Class
A
shares
for
the
Fund
and
for
Class
A
shares
and
Class
E
shares
for
each
other
fund
in
its
Expense
Group.
The
Board
received
a
description
of
the
methodology
used
by
Broadridge
to
select
the
mutual
funds
included
in
an
Expense
Group.
The
Expense
Group
for
the
Fund
included
the
Fund
and
10
other
real
estate
funds.
The
Board
noted
that
the
Management
Rate
and
actual
total
expense
ratio
for
the
Fund
were
below
the
medians
of
and
in
the
first
quintile
(least
expensive)
of
its
Expense
Group.
The
Board
concluded
that
the
Management
Rate
charged
to
the
Fund
is
reasonable.
Profitability
The
Board
reviewed
and
considered
information
regarding
the
profits
realized
by
the
Manager
and
its
affiliates
in
connection
with
the
operation
of
the
Fund.
In
this
respect,
the
Board
considered
the
Fund
profitability
analysis
provided
by
the
Manager
that
addresses
the
overall
profitability
of
FT’s
US
fund
business,
as
well
as
its
profits
in
providing
investment
management
and
other
services
to
each
of
the
individual
funds
during
the
12-month
period
ended
September
30,
2021,
being
the
most
recent
fiscal
year-
end
for
FRI.
The
Board
noted
that
although
management
continually
makes
refinements
to
its
methodologies
used
in
calculating
profitability
in
response
to
organizational
and
product-related
changes,
the
overall
methodology
has
remained
consistent
with
that
used
in
the
Fund’s
profitability
report
presentations
from
prior
years.
The
Board
also
noted
that
PricewaterhouseCoopers
LLP,
auditor
to
FRI
and
certain
FT
funds,
has
been
engaged
by
the
Manager
to
periodically
review
and
assess
the
allocation
methodologies
to
be
used
solely
by
the
Fund’s
Board
with
respect
to
the
profitability
analysis.
The
Board
noted
management’s
belief
that
costs
incurred
in
establishing
the
infrastructure
necessary
for
the
type
of
mutual
fund
operations
conducted
by
the
Manager
and
its
affiliates
may
not
be
fully
reflected
in
the
expenses
allocated
to
the
Fund
in
determining
its
profitability,
as
well
as
the
fact
that
the
level
of
profits,
to
a
certain
extent,
reflected
operational
cost
savings
and
efficiencies
initiated
by
management.
As
part
of
this
evaluation,
the
Board
considered
management’s
outsourcing
of
certain
operations,
which
effort
has
required
considerable
up-front
expenditures
by
the
Manager
but,
over
the
long
run
is
expected
to
result
in
greater
efficiencies.
The
Board
also
noted
management’s
expenditures
in
improving
shareholder
services
provided
Franklin
Real
Estate
Securities
Trust
Shareholder
Information
38
franklintempleton.com
Annual
Report
to
the
Fund,
as
well
as
the
need
to
implement
systems
and
meet
additional
regulatory
and
compliance
requirements
resulting
from
recent
US
Securities
and
Exchange
Commission
and
other
regulatory
requirements.
The
Board
also
considered
the
extent
to
which
the
Manager
and
its
affiliates
might
derive
ancillary
benefits
from
fund
operations,
including
revenues
generated
from
transfer
agent
services,
potential
benefits
resulting
from
personnel
and
systems
enhancements
necessitated
by
fund
growth,
as
well
as
increased
leverage
with
service
providers
and
counterparties.
Based
upon
its
consideration
of
all
these
factors,
the
Board
concluded
that
the
level
of
profits
realized
by
the
Manager
and
its
affiliates
from
providing
services
to
the
Fund
was
not
excessive
in
view
of
the
nature,
extent
and
quality
of
services
provided
to
the
Fund.
Economies
of
Scale
The
Board
reviewed
and
considered
the
extent
to
which
the
Manager
may
realize
economies
of
scale,
if
any,
as
the
Fund
grows
larger
and
whether
the
Fund’s
management
fee
structure
reflects
any
economies
of
scale
for
the
benefit
of
shareholders.
With
respect
to
possible
economies
of
scale,
the
Board
noted
the
existence
of
management
fee
breakpoints,
which
operate
generally
to
share
any
economies
of
scale
with
the
Fund’s
shareholders
by
reducing
the
Fund’s
effective
management
fees
as
the
Fund
grows
in
size.
The
Board
considered
the
Manager’s
view
that
any
analyses
of
potential
economies
of
scale
in
managing
a
particular
fund
are
inherently
limited
in
light
of
the
joint
and
common
costs
and
investments
the
Manager
incurs
across
the
FT
family
of
funds
as
a
whole.
The
Board
noted
that
the
Fund
had
experienced
a
decrease
in
assets
and
would
not
be
expected
to
demonstrate
additional
economies
of
scale
in
the
near
term,
but
concluded
that
to
the
extent
economies
of
scale
may
be
realized
by
the
Manager
and
its
affiliates,
the
Fund’s
management
fee
structure
provided
a
sharing
of
benefits
with
the
Fund
and
its
shareholders
as
the
Fund
grows.
Conclusion
Based
on
its
review,
consideration
and
evaluation
of
all
factors
it
believed
relevant,
including
the
above-described
factors
and
conclusions,
the
Board
unanimously
approved
the
continuation
of
the
Management
Agreement
for
an
additional
one-year
period.
Proxy
Voting
Policies
and
Procedures
The
Fund’s
investment
manager
has
established
Proxy
Voting
Policies
and
Procedures
(Policies)
that
the
Fund
uses
to
determine
how
to
vote
proxies
relating
to
portfolio
securities.
Shareholders
may
view
the
Fund’s
complete
Policies
online
at
franklintempleton.com.
Alternatively,
shareholders
may
request
copies
of
the
Policies
free
of
charge
by
calling
the
Proxy
Group
collect
at
(954)
527-
7678
or
by
sending
a
written
request
to:
Franklin
Templeton
Companies,
LLC,
300
S.E.
2nd
Street,
Fort
Lauderdale,
FL
33301,
Attention:
Proxy
Group.
Copies
of
the
Fund’s
proxy
voting
records
are
also
made
available
online
at
franklintempleton.com
and
posted
on
the
U.S.
Securities
and
Exchange
Commission’s
website
at
sec.gov
and
reflect
the
most
recent
12-month
period
ended
June
30.
Quarterly
Schedule
of
Investments
The
Trust,
on
behalf
of
the
Fund,
files
a
complete
schedule
of
investments
with
the
U.S.
Securities
and
Exchange
Commission
for
the
first
and
third
quarters
for
each
fiscal
year
as
an
exhibit
to
its
report
on
Form
N-PORT.
Shareholders
may
view
the
filed
Form
N-PORT
by
visiting
the
Commission’s
website
at
sec.gov.
The
filed
form
may
also
be
viewed
and
copied
at
the
Commission’s
Public
Reference
Room
in
Washington,
DC.
Information
regarding
the
operations
of
the
Public
Reference
Room
may
be
obtained
by
calling
(800)
SEC-0330.
Householding
of
Reports
and
Prospectuses
You
will
receive,
or
receive
notice
of
the
availability
of,
the
Fund’s
financial
reports
every
six
months.
In
addition,
you
will
receive
an
annual
updated
summary
prospectus
(detail
prospectus
available
upon
request).
To
reduce
Fund
expenses,
we
try
to
identify
related
shareholders
in
a
household
and
send
only
one
copy
of
the
financial
reports
(to
the
extent
received
by
mail)
and
summary
prospectus.
This
process,
called
“householding,”
will
continue
indefinitely
unless
you
instruct
us
otherwise.
If
you
prefer
not
to
have
these
documents
householded,
please
call
us
at
(800)
632-2301.
At
any
time
you
may
view
current
prospectuses/
summary
prospectuses
and
financial
reports
on
our
website.
If
you
choose,
you
may
receive
these
documents
through
electronic
delivery.
192
A
06/22
©
2022
Franklin
Templeton
Investments.
All
rights
reserved.
Authorized
for
distribution
only
when
accompanied
or
preceded
by
a
summary
prospectus
and/or
prospectus.
Investors
should
carefully
consider
a
fund’s
investment
goals,
risks,
charges
and
expenses
before
investing.
A
prospectus
contains
this
and
other
information;
please
read
it
carefully
before
investing.
To
help
ensure
we
provide
you
with
quality
service,
all
calls
to
and
from
our
service
areas
are
monitored
and/or
recorded.
Annual
Report
and
Shareholder
Letter
Franklin
Real
Estate
Securities
Fund
Investment
Manager
Distributor
Shareholder
Services
Franklin
Advisers,
Inc.
Franklin
Distributors,
LLC
(800)
DIAL
BEN
®
/
342-5236
franklintempleton.com
(800)
632-2301
Item 2. Code of Ethics.
 
(a) The Registrant has adopted a code of ethics that applies to its principal executive officers and principal financial and accounting officer. 
 
(c) N/A
 
(d) N/A
 
(f) Pursuant to Item 13(a)(1), the Registrant is attaching as an exhibit a copy of its code of ethics that applies to its principal executive officers and principal financial and accounting officer.
 
Item 3. Audit Committee Financial Expert.
 
(a)(1) The Registrant has an audit committee financial expert serving on its audit committee.
 
(2) The audit committee financial expert is Mary C. Choksi and she is "independent" as defined under the relevant Securities and Exchange Commission Rules and Releases.
 
 
Item 4.
Principal Accountant Fees and Services.
 
(a)      Audit Fees
The aggregate fees paid to the principal accountant for professional services rendered by the principal accountant for the audit of the registrant’s annual financial statements or for services that are normally provided by the principal accountant in connection with statutory and regulatory filings or engagements were $27,004 for the fiscal year ended April 30, 2022 and $36,674 for the fiscal year ended April 30, 2021.
 
(b)      Audit-Related Fees
There were no fees paid to the principal accountant for assurance and related services rendered by the principal accountant to the registrant that are reasonably related to the performance of the audit of the registrant's financial statements and are not reported under paragraph (a) of Item 4.
 
There were no fees paid to the principal accountant for assurance and related services rendered by the principal accountant to the registrant's investment adviser and any entity controlling, controlled by or under common control with the investment adviser that provides ongoing services to the registrant that are reasonably related to the performance of the audit of their financial statements. 
 
(c)      Tax Fees
There were no fees paid to the principal accountant for professional services rendered by the principal accountant to the registrant for tax compliance, tax advice and tax planning.
 
The aggregate fees paid to the principal accountant for professional services rendered by the principal accountant to the registrant’s investment adviser and any entity controlling, controlled by or under common control with the investment adviser that provides ongoing services to the registrant for tax compliance, tax advice and tax planning
were $0 for the fiscal year ended April 30, 2022 and $170,219 for the fiscal year ended April 30, 2021.  The services for which these fees were paid included tax compliance services related to year-end.
 
(d)      All Other Fees
The aggregate fees paid to the principal accountant for products and services rendered by the principal accountant to the registrant not reported in paragraphs (a)-(c) of Item 4
were $228 for the fiscal year ended April 30, 2022 and $0 for the fiscal year ended April 30, 2021. The services for which these fees were paid include review of materials provided to the fund Board in connection with the investment management contract renewal process.
 
The aggregate fees paid to the principal accountant for products and services rendered by the principal accountant to the registrant’s investment adviser and any entity controlling, controlled by or under common control with the investment adviser that provides ongoing services to the registrant not reported in paragraphs (a)-(c) of Item 4 were $243,743 for the fiscal year ended April 30, 2022 and $38,350 for the fiscal year ended April 30, 2021. The services for which these fees were paid included compliance examination for Investment Advisor Act rule 204-2 and 206-4(2), benchmarking services in connection with the ICI TA survey, professional services relating to the readiness assessment over Greenhouse Gas Emissions and Energy, professional fees in connection with determining the feasibility of a U.S. direct lending structure, for the issuance of an Auditor’s Certificate for South Korean regulatory shareholders disclosures, assets under management certification,
fees in connection with license for employee development tool ProEdge, and professional fees in connection with SOC 1 Reports.
(e) (1) The registrant’s audit committee is directly responsible for approving the services to be provided by the auditors, including:
 
        (i)     pre-approval of all audit and audit related services;
 
        (ii)    pre-approval of all non-audit related services to be provided to the Fund by the auditors;
 
        (iii)   pre-approval of all non-audit related services to be provided to the registrant by the auditors to the registrant’s investment adviser or to any entity that controls, is controlled by or is under common control with the registrant’s investment adviser and that provides ongoing services to the registrant where the non-audit services relate directly to the operations or financial reporting of the registrant; and
 
        (iv)    establishment by the audit committee, if deemed necessary or appropriate, as an alternative to committee pre-approval of services to be provided by the auditors, as required by paragraphs (ii) and (iii) above, of policies and procedures to permit such services to be pre-approved by other means, such as through establishment of guidelines or by action of a designated member or members of the committee; provided the policies and procedures are detailed as to the particular service and the committee is informed of each service and such policies and procedures do not include delegation of audit committee responsibilities, as contemplated under the Securities Exchange Act of 1934, to management; subject, in the case of (ii) through (iv), to any waivers, exceptions or exemptions that may be available under applicable law or rules.
 
(e) (2) None of the services provided to the registrant described in paragraphs (b)-(d) of Item 4 were approved by the audit committee pursuant to paragraph (c)(7)(i)(C) of Rule 2-01 of regulation S-X.
 
(f) No disclosures are required by this Item 4(f).
 
(g) The aggregate non-audit fees paid to the principal accountant for services rendered by the principal accountant to the registrant and the registrant’s investment adviser and any entity controlling, controlled by or under common control with the investment adviser that provides ongoing services to the registrant were $243,971 for the fiscal year ended April 30, 2022 and $208,569 for the fiscal year ended April 30, 2021.
 
(h) The registrant’s audit committee of the board has considered whether the provision of non-audit services that were rendered to the registrant’s investment adviser (not including any sub-adviser whose role is primarily portfolio management and is subcontracted with or overseen by another investment adviser), and any entity controlling, controlled by, or under common control with the investment adviser that provides ongoing services to the registrant that were not pre-approved pursuant to paragraph (c)(7)(ii) of Rule 2-01 of Regulation S-X is compatible with maintaining the principal accountant’s independence.
     


Item 5. Audit Committee
 
of Listed Registrants. N/A
 
 
Item 6. Schedule of Investments. N/A

 
Item 7.  Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies. N/A
 
 
Item 8.  Portfolio Managers of Closed-End Management Investment Companies. N/A
 
 
Item 9.  Purchases of Equity Securities by Closed-End Management Investment Company and
Affiliated Purchasers. N/A
 
 
Item 10. Submission of Matters to a Vote of Security Holders.
 
There have been no changes to the procedures by which shareholders may recommend nominees to the Registrant's Board of Trustees that would require disclosure herein.
 
 
Item 11. Controls and Procedures.
 
(a) Evaluation of Disclosure Controls and Procedures.
The Registrant maintains disclosure controls and procedures that are designed to provide reasonable assurance that information required to be disclosed in the Registrant’s filings under the Securities Exchange Act of 1934, as amended, and the Investment Company Act of 1940 is recorded, processed, summarized and reported within the periods specified in the rules and forms of the Securities and Exchange Commission. Such information is accumulated and communicated to the Registrant’s management, including its principal executive officer and principal financial officer, as appropriate, to allow timely decisions regarding required disclosure. The Registrant’s management, including the principal executive officer and the principal financial officer, recognizes that any set of controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives.
 
Within 90 days prior to the filing date of this Shareholder Report on Form N-CSR, the Registrant had carried out an evaluation, under the supervision and with the participation of the Registrant’s management, including the Registrant’s principal executive officer and the Registrant’s principal financial officer, of the effectiveness of the design and operation of the Registrant’s disclosure controls and procedures. Based on such evaluation, the Registrant’s principal executive officer and principal financial officer concluded that the Registrant’s disclosure controls and procedures are effective.
 
(b) Changes in Internal Controls.
There have been no changes in the Registrant’s internal control over financial reporting that occurred during the period covered by this report that has materially affected, or is reasonably likely to materially affect the internal control over financial reporting.
 
 
Item 12. Disclosure of Securities Lending Activities for Closed-End Management Investment Company.                             N/A
 
 
Item 13. Exhibits.
 
(a)(1) Code of Ethics
 
codeofethics
 
(a)(2) Certifications pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 of Matthew T. Hinkle, Chief Executive Officer - Finance and Administration, and Christopher Kings, Chief Financial Officer, Chief Accounting Officer and Treasurer
 
section302
 
(b) Certifications pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 of Matthew T. Hinkle, Chief Executive Officer - Finance and Administration, and Christopher Kings, Chief Financial Officer, Chief Accounting Officer and Treasurer
 
section906
 
SIGNATURES
 
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
 
 
 
FRANKLIN REAL ESTATE SECURITIES TRUST
 
 
By S\MATTHEW T. HINKLE______________________
Matthew T. Hinkle
      Chief Executive Officer - Finance and Administration
Date  June 29, 2022
 
 
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.
 
 
By S\MATTHEW T. HINKLE______________________
Matthew T. Hinkle
      Chief Executive Officer - Finance and Administration
Date  June 29, 2022
 
 
By S\CHRISTOPHER KINGS______________________
      Christopher Kings
      Chief Financial Officer, Chief Accounting Officer and Treasurer
Date  June 29, 2022
 

Code of Ethics for Principal Executives & Senior Financial Officers
 
 

Procedures
 
Revised December 19, 2014
 
 
 

FRANKLIN TEMPLETON FUNDS

 
CODE OF ETHICS FOR PRINCIPAL EXECUTIVES AND SENIOR FINANCIAL OFFICERS

I.
            
Covered Officers and Purpose of the
Code

 
This code of ethics (the "Code") applies to the Principal Executive Officers, Principal Financial Officer and Principal Accounting Officer (the "Covered Officers," each of whom is set forth in Exhibit A) of each investment company advised by a Franklin Resources subsidiary and that is registered with the United States Securities & Exchange Commission (“SEC”) (collectively, "FT Funds") for the purpose of promoting:
 
·
        
Honest and ethical conduct, including the ethical resolution of actual or apparent conflicts of interest between personal and professional
relationships;
·
        
Full, fair, accurate, timely and understandable disclosure in reports and documents
that a registrant files with, or submits to, the SEC and in other public communications made by or on behalf of the FT
Funds;
·
        
Compliance with applicable laws and governmental rules and
regulations;
·
        
The prompt internal reporting of violations of the Code to an appropriate person or persons identified in the Code;
and
·
        
Accountability for adherence to the
Code.
 
Each Covered Officer will be expected to adhere to a high standard of business ethics and must be sensitive to situations that may give rise to actual as well as apparent conflicts of interest.
 
 
 
 
*
Rule
38a-1
under
the Investment
Company
Act
of
1940
(“1940
Act”)
and
Rule
206(4)-7
under
the
Investment
Advisers
Act
of 1940 (“Advisers Act”) (together the “Compliance Rule”) require registered investment companies and registered investment advisers to, among other things, adopt and implement written policies and procedures reasonably designed to prevent violations of the federal securities laws (“Compliance Rule Policies and
Procedures”).
 
CONFIDENTIAL INFORMATION. This document is the proprietary product of Franklin Templeton Investments. It may NOT be distributed outside the company unless it is made subject to a non-disclosure agreement and/or such release receives authorization by an FTI Chief Compliance Officer. Any unauthorized use, reproduction or transfer of this document is strictly prohibited. Franklin Templeton Investments © 2014. All Rights
Reserved.
 

II.
            
Other Policies and
Procedures

 
This Code shall be the sole code of ethics adopted by the Funds for purposes of Section 406 of the Sarbanes-Oxley Act and the rules and forms applicable to registered investment companies thereunder.
 
Franklin Resources, Inc. has separately adopted the Code of Ethics and Business Conduct (“Business Conduct”), which is applicable to all officers, directors and employees of Franklin Resources, Inc., including Covered Officers. It summarizes the values, principles and business practices that guide the employee’s business conduct and also provides a set of basic principles to guide officers, directors and employees regarding the minimum ethical requirements expected of them. It supplements the values, principles and business conduct identified in the Code and other existing employee
policies.
 
Additionally, the Franklin Templeton Funds have separately adopted the FTI Personal Investments and Insider Trading Policy governing personal securities trading and other related matters. The Code for Insider Trading provides for separate requirements that apply to the Covered Officers and others, and therefore is not part of this Code.
 
Insofar as other policies or procedures of Franklin Resources, Inc., the Funds, the Funds’ adviser, principal underwriter, or other service providers govern or purport to govern the behavior or activities of the Covered Officers who are subject to this Code, they are superceded by this Code to the extent that they overlap or conflict with the provisions of this Code. Please review these other documents or consult with the Legal Department if have questions regarding the applicability of these policies to
you.
 

III.
            
Covered Officers Should Handle Ethically Actual and Apparent Conflicts of Interest

 
Overview. A "conflict of interest" occurs when a Covered Officer's private interest interferes with the interests of, or his or her service to, the FT Funds. For example, a conflict of interest would arise if a Covered Officer, or a member of his family, receives improper personal benefits as a result of apposition with the FT Funds.
 
Certain conflicts of interest arise out of the relationships between Covered Officers and the FT Funds and already are subject to conflict of interest provisions in the Investment Company Act of 1940 ("Investment Company Act") and the Investment Advisers Act of 1940 ("Investment Advisers Act"). For example, Covered Officers may not individually engage in certain transactions (such as the purchase or sale of securities or other property) with the FT Funds because of their status as "affiliated persons" of the FT Funds. The FT Funds’ and the investment advisers’ compliance programs and procedures are designed to prevent, or identify and correct, violations of these provisions. This Code does not, and is not intended to, repeat or replace these programs and procedures, and such conflicts fall outside of the parameters of this Code.
 
Although typically not presenting an opportunity for improper personal benefit, conflicts arise from, or as a result of, the contractual relationship between the FT Funds, the investment advisers and the fund administrator of which the Covered Officers are also officers or employees. As a result, this Code recognizes that the Covered Officers will, in the normal course of their duties (whether formally for the FT Funds, for the adviser, the administrator, or

2


for all three), be involved in establishing policies and implementing decisions that will have different effects on the adviser, administrator and the FT Funds. The participation of the Covered Officers in such activities is inherent in the contractual relationship between the FT Funds, the adviser, and the administrator and is consistent with the performance by the Covered Officers of their duties as officers of the FT Funds. Thus, if performed in conformity with the provisions of the Investment Company Act and the Investment Advisers Act, such activities will be deemed to have been handled ethically. In addition, it is recognized by the FT Funds' Boards of Directors ("Boards") that the Covered Officers may also be officers or employees of one or more other investment companies covered by this or other codes.
 
Other conflicts of interest are covered by the Code, even if such conflicts of interest are not subject to provisions in the Investment Company Act and the Investment Advisers Act. The following list provides examples of conflicts of interest under the Code, but Covered Officers should keep in mind that these examples are not exhaustive. The overarching principle is that the personal interest of a Covered Officer should not be placed improperly before the interest of the FT Funds.
 
Each Covered Officer must:
·
        
Not use his or her personal influence or personal relationships improperly to influence investment decisions or financial reporting by the FT Funds whereby the Covered
Officer would benefit personally to the detriment of the FT
Funds;
·
        
Not cause the FT Funds to take action, or fail to take action, for the individual personal benefit of the Covered Officer rather than the benefit the FT
Funds;
·
        
Not retaliate against any other Covered Officer or any employee of the FT Funds or their affiliated persons for reports of potential violations that are made in good
faith;
·
        
Report at least annually the following affiliations or other
relationships:
1
o
   
all directorships for public companies and all companies that are required to file reports with the
SEC;
o
   
any direct or indirect business relationship with any independent directors of
the FT
Funds;
o
   
any direct or indirect business relationship with any independent public accounting firm (which are not related to the routine issues related to the
firm’s service as the Covered Persons accountant);
and
o
   
any direct or indirect interest in any transaction with any FT Fund that will benefit the officer (not including benefits derived from the advisory, sub-advisory, distribution or service agreements with affiliates of Franklin
Resources).
These reports will be reviewed by the Legal Department for compliance with the Code.
There are some conflict of interest situations that should always be approved in writing by Franklin Resources General Counsel or Deputy General Counsel, if material. Examples of these include
2
:
·
        
Service as a director on the board of any public or private
Company.
 

1
 
Reporting
of
these
affiliations
or
other
relationships
shall
be
made
by
completing
the
annual
Directors
and
Officers
Questionnaire and returning the questionnaire to Franklin Resources Inc, General Counsel or Deputy General
Counsel.
2
    
Any
activity
or
relationship
that
would
present
a
conflict
for
a
Covered Officer
may
also
present
a
conflict
for
the
Covered Officer
if a member of the Covered Officer's immediate family engages in such an activity or has such a relationship. The Cover Person should also obtain written approval by FT’s General Counsel in such situations.
 

3


·
        
The receipt of any gifts in excess of $100 from any person, from any corporation
or association.
·
        
The receipt of any entertainment from any Company with which the FT Funds has current or prospective business dealings unless such entertainment is business related, reasonable in cost, appropriate as to time and place, and not so frequent as to raise
any question of impropriety. Notwithstanding the foregoing, the Covered Officers must obtain prior approval from the Franklin Resources General Counsel for any entertainment with a value in excess of
$1000.
·
        
Any ownership interest in, or any consulting or employment relationship with, any of
the FT Fund’s service providers, other than an investment adviser, principal underwriter, administrator or any affiliated person
thereof.
·
        
A direct or indirect financial interest in commissions, transaction charges or spreads paid by the FT Funds for effecting portfolio transactions or for selling or redeeming shares other than an interest arising from the Covered Officer's employment, such as compensation or equity
ownership.
·
        
Franklin Resources General Counsel or Deputy General Counsel will provide a report
to the FT Funds Audit Committee of any approvals granted at the next regularly scheduled meeting.
 

IV.
            
Disclosure and
Compliance

·
        
Each Covered Officer should familiarize himself with the disclosure
requirements generally applicable to the FT
Funds;
·
        
Each Covered Officer should not knowingly misrepresent, or cause others to misrepresent, facts about the FT Funds to others, whether within or outside the FT Funds, including to the FT Funds’ directors and auditors, and to governmental
regulators and self-regulatory
organizations;
·
        
Each Covered Officer should, to the extent appropriate within his or her area of responsibility, consult with other officers and employees of the FT Funds, the FT Fund’s adviser and the administrator with the goal of promoting full, fair, accurate, timely and understandable disclosure in the reports and documents the FT Funds file with, or submit to, the SEC and in other public communications made by the FT Funds;
and
·
        
It is the responsibility of each Covered Officer to promote compliance with the standards and restrictions imposed by applicable laws, rules and
regulations.
 

V.
            
Reporting and Accountability

 
Each Covered Officer must:
·
        
Upon becoming a covered officer affirm in writing to the Board that he or she has received, read, and understands the Code (see Exhibit
B);
·
        
Annually thereafter affirm to the Board that he has complied with the requirements of
the Code;
and
·
        
Notify Franklin Resources’ General Counsel or Deputy General Counsel promptly if he or she knows of any violation of this Code. Failure to do so is itself is a violation of
this

4


Code.
Franklin Resources’ General Counsel and Deputy General Counsel are responsible for applying this Code to specific situations in which questions are presented under it and have the authority to interpret this Code in any particular situation.
3
 
However, the Independent Directors of the respective FT Funds will consider any approvals or waivers
4
 
sought by any Chief Executive Officers of the Funds.
 
The FT Funds will follow these procedures in investigating and enforcing this Code:
 
·
        
Franklin Resources General Counsel or Deputy General Counsel will take all
appropriate action to investigate any potential violations reported to the Legal
Department;
·
        
If, after such investigation, the General Counsel or Deputy General Counsel believes that no violation has occurred, The General Counsel is not required to take any
further action;
·
        
Any matter that the General Counsel or Deputy General Counsel believes is a
violation will be reported to the Independent Directors of the appropriate FT
Fund;
·
        
If the Independent Directors concur that a violation has occurred, it will inform and make a recommendation to the Board of the appropriate FT Fund or Funds, which will
consider appropriate action, which may include review of, and appropriate modifications to, applicable policies and procedures; notification to appropriate personnel of the investment adviser or its board; or a recommendation to dismiss the Covered
Officer;
·
        
The Independent Directors will be responsible for granting waivers, as appropriate;
and
·
        
Any changes to or waivers of this Code will, to the extent required, are disclosed
as provided by SEC
rules.
5

VI.
            
Other Policies and
Procedures

 
This Code shall be the sole code of ethics adopted by the FT Funds for purposes of Section 406 of the Sarbanes-Oxley Act and the rules and forms applicable to registered investment companies thereunder. Insofar as other policies or procedures of the FT Funds, the FT Funds' advisers, principal underwriter, or other service providers govern or purport to govern the behavior or activities of the Covered Officers who are subject to this Code, they are superseded by this Code to the extent that they overlap or conflict with the provisions of this Code. The FTI Personal Investments and Insider Trading Policy, adopted by the FT Funds, FT investment advisers and FT Fund’s principal underwriter pursuant to Rule 17j-1 under the Investment Company Act, the Code of Ethics and Business Conduct and more detailed policies and procedures set forth in FT’s Employee Handbook are separate requirements applying to the Covered Officers and others, and are not part of this
Code.
 
 
 

3
 
Franklin
Resources
General
Counsel
and
Deputy
General
Counsel
are
authorized
to
consult,
as
appropriate,
with
members
of
the Audit
Committee, counsel
to
the
FT
Funds
and
counsel
to
the
Independent
Directors,
and
are
encouraged
to
do
so.
4
  
Item
2
of
Form
N-CSR
defines
"waiver"
as
"the
approval
by
the
registrant
of
a
material
departure
from
a
provision
of
the
code
of
ethics" and "implicit waiver," which must also be disclosed, as "the registrant's failure to take action within a reasonable period of time regarding a material departure from a provision of the code of ethics that has been made known to an executive officer" of the registrant. See Part X.
5
   
See Part
X.

VII.
            
Amendments

 
Any amendments to this Code, other than amendments to Exhibit A, must be approved or ratified by a majority vote of the FT Funds’ Board including a majority of independent directors.

VIII.
            
Confidentiality

 
All reports and records prepared or maintained pursuant to this Code will be considered confidential and shall be maintained and protected accordingly. Except as otherwise required by law or this Code, such matters shall not be disclosed to anyone other than the FT Funds’ Board and their counsel.

IX.
            
Internal
Use

 
The Code is intended solely for the internal use by the FT Funds and does not constitute an admission, by or on behalf of any FT Funds, as to any fact, circumstance, or legal conclusion.
 
X.
           
Disclosure on Form
N-CSR
 
Item 2 of Form N-CSR requires a registered management investment company to disclose annually whether, as of the end of the period covered by the report, it has adopted a code of ethics that applies to the registrant's principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions, regardless of whether these officers are employed by the registrant or a third party. If the registrant has not adopted such a code of ethics, it must explain why it has not done so.
The registrant must also: (1) file with the SEC a copy of the code as an exhibit to its annual report; (2) post the text of the code on its Internet website and disclose, in its most recent report on Form N-CSR, its Internet address and the fact that it has posted the code on its Internet website; or (3) undertake in its most recent report on Form N-CSR to provide to any person without charge, upon request, a copy of the code and explain the manner in which such request may be made. Disclosure is also required of amendments to, or waivers (including implicit waivers) from, a provision of the code in the registrant's annual report on Form N-CSR or on its website. If the registrant intends to satisfy the requirement to disclose amendments and waivers by posting such information on its website, it will be required to disclose its Internet address and this
intention.
The Legal Department shall be responsible for ensuring that:
·
        
a copy of the Code is filed with the SEC as an exhibit to each Fund’s annual report;
and
·
        
any amendments to, or waivers (including implicit waivers) from, a provision of the
Code is disclosed in the registrant's annual report on Form
N-CSR.
In the event that the foregoing disclosure is omitted or is determined to be incorrect, the Legal Department shall promptly file such information with the SEC as an amendment to Form N-CSR.
In such an event, the Fund Chief Compliance Officer shall review the Code and propose such changes to the Code as are necessary or appropriate to prevent reoccurrences.

EXHIBIT A

 
Persons Covered by the Franklin Templeton Funds Code of Ethics
January 1, 2022
 
 

FRANKLIN GROUP OF FUNDS

 
Edward
Perks                           President and Chief Executive Officer – Investment Management
Rupert H.
Johnson,
Jr.               Chairman of the Board and Vice
President
Michael
McCarthy                      President and Chief Executive Officer – Investment Management
Sonal Desai,
Ph
D                     President and Chief Executive Officer – Investment Management
Matthew
Hinkle                          Chief Executive Officer – Finance and
Administration
Christopher Kings                     Chief Financial Officer and Chief Accounting Officer and Treasurer
 
           
 

FRANKLIN MUTUAL SERIES FUNDS

 
Christian K. Correa                    Chief Executive Officer – Investment Management
Matthew
Hinkle                          Chief Executive Officer – Finance and Administration
Christopher Kings                     Chief Financial Officer and Chief Accounting Officer and Treasurer
 
 

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

 
Brooks
Ritchey                          President and Chief Executive Officer – Investment Management
Matthew
Hinkle                          Chief Executive Officer – Finance and
Administration
Christopher Kings                     Chief Financial Officer, Chief Accounting Officer and Treasurer
 
 
 

TEMPLETON GROUP OF FUNDS

 
Rupert H.
Johnson
Jr.                Chairman of the Board and Vice
President
Manraj
S.
Sekhon                      President and Chief Executive Officer – Investment Management
Michael Hasenstab, Ph.D.          President and Chief Executive Officer – Investment Management
Alan
Bartlett                              President and Chief Executive Officer – Investment Management
Matthew
Hinkle                          Chief Executive Officer – Finance and
Administration
Christopher Kings                     Chief Financial Officer, Chief Accounting Officer and Treasurer

Exhibit B ACKNOWLEDGMENT FORM

 

Franklin Templeton Funds Code of Ethics

For Principal Executives and Senior Financial Officers
 
 

Instructions:

1.
     
Complete all sections of this
form.
2.
     
Print the completed form, sign, and
date.
3.
     
Submit completed form to FT’s General Counsel c/o Code of Ethics Administration within 10 days of becoming a Covered Officer and by February 15th of each subsequent year.
 
E-mail:      Code of Ethics Inquiries & Requests (internal address);
lpreclear@franklintempleton.com
(external
address)
 
 
Covered Officer’s Name:
 
Title:
 
Department:
 
Location:
 
Certification for Year Ending:
 
 
 
To: Franklin Resources General Counsel, Legal Department
 
I acknowledge receiving, reading and understanding the Franklin Templeton Fund’s Code of Ethics for Principal Executive Officers and Senior Financial Officers (the “Code”). I will comply fully with all provisions of the Code to the extent they apply to me during the period of my employment. I further understand and acknowledge that any violation of the Code may subject me to disciplinary action, including termination of employment.
 
 
 
 

Signature
 
Date signed
 

 
 
I, Matthew T. Hinkle, certify that:
 
1.
      
I have reviewed this report on Form N-CSR of Franklin Real Estate Securities Trust;
2.
      
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;   
3.
      
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations, changes in net assets, and cash flows (if the financial statements are required to include a statement of cash flows) of the registrant as of, and for, the periods presented in this report;
4.
      
The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) and internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) for the registrant and have:
(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
 
(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
 
(c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report based on such evaluation; and
 
(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the second fiscal quarter of the period covered by this report that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and 
5.
      
The registrant's other certifying officer(s) and I have disclosed to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize, and report financial information; and
(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
 
6/29/2022
 
 
 
S\MATTHEW T. HINKLE
 
Matthew T. Hinkle
Chief Executive Officer - Finance and Administration
 

 
I, Christopher Kings, certify that:
 
1.
      
I have reviewed this report on Form N-CSR of Franklin Real Estate Securities Trust;
2.
      
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;   
3.
      
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations, changes in net assets, and cash flows (if the financial statements are required to include a statement of cash flows) of the registrant as of, and for, the periods presented in this report;
4.
      
The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) and internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) for the registrant and have:
(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
 
(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
 
(c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report based on such evaluation; and
 
(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the second fiscal quarter of the period covered by this report that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and 
5.
      
The registrant's other certifying officer(s) and I have disclosed to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize, and report financial information; and
(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
 
6/29/2022
 
 
 
S\CHRISTOPHER KINGS
 
Christopher Kings
Chief Financial Officer, Chief Accounting Officer and Treasurer
 

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350
AS ADOPTED PURSUANT TO SECTION 906

OF THE SARBANES-OXLEY ACT OF 2002

 
I, Matthew T. Hinkle, Chief Executive Officer of the Franklin Real Estate Securities Trust (the “Registrant”), certify, pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to my knowledge:
 
1.
                  
The periodic report on Form N-CSR of the Registrant for the period ended 4/30/2022 (the “Form N-CSR”) fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
 
2.
                  
The information contained in the Form N-CSR fairly presents, in all material respects, the financial condition and results of operations of the Registrant.
 
Dated:  6/29/2022
 
                                                S\MATTHEW T. HINKLE
                                                                                                           
                                                Matthew T. Hinkle
Chief Executive Officer - Finance and Administration
                        

 
 
CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350
AS ADOPTED PURSUANT TO SECTION 906

OF THE SARBANES-OXLEY ACT OF 2002

 
I, Christopher Kings, Chief Financial Officer of the Franklin Real Estate Securities Trust (the “Registrant”), certify, pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to my knowledge:
 
1.
                  
The periodic report on Form N-CSR of the Registrant for the period ended 4/30/2022 (the “Form N-CSR”) fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
 
2.
                  
The information contained in the Form N-CSR fairly presents, in all material respects, the financial condition and results of operations of the Registrant.
 
Dated:  6/29/2022
 
                                                S\CHRISTOPHER KINGS
                                                                                                           
                                                Christopher Kings
Chief Financial Officer, Chief Accounting Officer and Treasurer