Principal Real Estate Income Fund Announces Notification of Sources
of Distribution

DENVER–(BUSINESS WIRE)–The Principal Real Estate Income Fund (NYSE:PGZ) announces the sources
of a distribution paid on May 31, 2019 of $0.11 per share to
shareholders of record at the close of business on May 17, 2019,
pursuant to the Fund’s managed distribution plan. This press release is
issued as required by an exemptive order granted to the Fund by the U.S.
Securities and Exchange Commission and includes the notice below sent to
shareholders regarding the source of the distribution.

Statement Pursuant to Section 19(a) of the Investment Company Act of
1940

The following table sets forth the estimated amount of the sources of
distribution for purposes of Section 19 of the Investment Company Act of
1940, as amended, and the related rules adopted thereunder. In
accordance with generally accepted accounting principles (“GAAP”), the
Fund estimates the following percentages, of the total distribution
amount per share, attributable to (i) current and prior fiscal year net
investment income, (ii) net realized short-term capital gain, (iii) net
realized long-term capital gain and (iv) return of capital or other
capital source as a percentage of the total distribution amount. These
percentages are disclosed for the current distribution as well as the
fiscal year-to-date cumulative distribution amount per share for the
Fund.

The Fund estimates that it has distributed more than its income;
therefore, a portion of your distribution may be a return of capital. A
return of capital may occur, for example, when some or all of the money
that you invested in the Fund is paid back to you. A return of capital
distribution does not necessarily reflect the Fund’s investment
performance and should not be confused with ‘yield’ or ‘income.’

The timing and character of distributions for federal income tax
purposes are determined in accordance with income tax regulations which
may differ from GAAP. As such, all or a portion of this distribution may
be reportable as taxable income on your 2019 federal income tax return.
The final tax character of any distribution declared in 2019 will be
determined in January 2020 and reported to you on IRS Form 1099-DIV.

The amounts and sources of distributions reported in this 19(a)
Notice are only estimates and not for tax reporting purposes. The actual
amounts and sources of the amounts for tax reporting purposes will
depend upon the Fund’s investment experience during the remainder of its
fiscal year and may be subject to changes based on tax regulations. The
Fund will send you a Form 1099-DIV for the calendar year that will tell
you how to report these distributions for federal income tax purposes.

Presented below are return figures, based on the change in the Fund’s
Net Asset Value per share (“NAV”), compared to the annualized
distribution rate for this current distribution as a percentage of the
NAV on the last day of the month prior to distribution record date.

^ Based on the Fund’s NAV as of April 30, 2019.
* Cumulative fiscal
year-to-date return is based on the change in NAV including
distributions paid and assuming reinvestment of these distributions for
the period November 1, 2018 through April 30, 2019.
** The 5 year
average annual total return is based on change in NAV including
distributions paid and assuming reinvestment of these distributions and
is through the last business day of the month prior to the month of the
current distribution record date.

While the NAV performance may be indicative of the Fund’s investment
performance, it does not measure the value of a shareholder’s investment
in the Fund. The value of a shareholder’s investment in the Fund is
determined by the Fund’s market price, which is based on the supply and
demand for the Fund’s shares in the open market. Past performance does
not guarantee future results. Shareholders should not draw any
conclusions about the Fund’s investment performance from the amount of
this distribution or from the terms of the Fund’s Managed Distribution
Plan.

Furthermore, the Board of Trustees reviews the amount of any potential
distribution and the income, capital gain or capital available. The
Board of Trustees will continue to monitor the Fund’s distribution
level, taking into consideration the Fund’s net asset value and the
financial market environment. The Fund’s distribution policy is subject
to modification by the Board of Trustees at any time. The distribution
rate should not be considered the dividend yield or total return on an
investment in the Fund.

Please retain this document for your records.

ALPS Advisors, Inc. is the investment adviser to the Fund.

Principal Real Estate Investors LLC is the investment sub-adviser to
the Fund. Principal Real Estate Investors LLC is not affiliated with
ALPS Advisors, Inc. or any of its affiliates.

ALPS Portfolio Solutions Distributor, Inc. is the FINRA Member.

Contacts

Dennis Emanuel*
Director of ETF and CEF Strategy
ALPS Advisors
914.837.4672
[email protected]

*Registered
Representative of ALPS Distributors, Inc.