Semiannual Report 10/31/2017. Oppenheimer Real Estate Fund

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1 Semiannual Report 10/31/2017 Oppenheimer Real Estate Fund

2 Table of Contents Fund Performance Discussion 3 Top Holdings and Allocations 6 Fund Expenses 9 Statement of Investments 11 Statement of Assets and Liabilities 13 Statement of Operations 15 Statements of Changes in Net Assets 16 Financial Highlights 17 Notes to Financial Statements 29 Board Approval of the Fund s Investment Advisory, Sub- Advisory and Sub-Sub Advisory Agreements 41 Portfolio Proxy Voting Policies and Guidelines; Updates to Statements of Investments 44 Distribution Sources 45 Trustees and Officers 46 Privacy Notice 47 Class A Shares AVERAGE ANNUAL TOTAL RETURNS AT 10/31/17 Class A Shares of the Fund Without Sales Charge With Sales Charge FTSE NAREIT Equity REIT Index 6-Month 0.93% -4.88% 1.36% 1-Year Year Year Performance data quoted represents past performance, which does not guarantee future results. The investment return and principal value of an investment in the Fund will fluctuate so that an investor s shares, when redeemed, may be worth more or less than their original cost. Fund returns include changes in share price, reinvested distributions, and a 5.75% maximum applicable sales charge except where without sales charge is indicated. Current performance may be lower or higher than the performance quoted. Returns do not consider capital gains or income taxes on an individual's investment. Returns for periods of less than one year are cumulative and not annualized. For performance data current to the most recent monthend, visit oppenheimerfunds.com or call CALL OPP ( ). See Fund prospectuses and summary prospectuses for more information on share classes and sales charges. 2 OPPENHEIMER REAL ESTATE FUND

3 Fund Performance Discussion The Fund s Class A shares (without sales charges) produced a 0.92% return for the period from May 1, 2017 through October 31, On a relative basis, the Fund underperformed the FTSE NAREIT Equity REIT Index (the Index ), which produced a 1.36% return for the same period. MARKET OVERVIEW The Index posted a 1.36% return for the six-month period ending October 31, Returns were bifurcated among property sectors. The Industrial, Data Centers, Manufactured Homes, and Hotel sectors all posted very strong results, while Retail (including shopping centers, and free standing) and Health Care had negative returns. The Industrial sector continued to benefit from e-commerce demand. Supply remained at manageable levels, and high occupancy levels have been providing landlords strong pricing power. The data center sector s performance has been driven by the growth of cloud computing. We believe strong leasing can continue as more companies continue to outsource their data center requirements. In general, Manufactured Housing REITs continued to generate consistent 3% - 4% annual rent increases, whereas most core property types are seeing decelerating rental growth. Zoning restrictions continue to limit new supply for this sector. Hotel stocks, including Hilton, a hotel operating company owned by the Fund, outperformed in the period despite disruption by two major hurricanes, as investors looked for potential positive impacts from the growth initiatives in the pending tax bill. The Retail sectors all saw negative performance again in this period, as elevated store closings remained a headwind to fundamentals. We expect tenant closings to weigh on mall earnings through the balance of the year. Malls also face a several year period of repurposing department stores. During the period, Amazon announced its agreement to acquire Whole Foods Markets. This transaction created additional near-term price deflation for the shopping centers sector. Health Care stocks underperformed in the period on several company-specific tenant issues and a market focus on higher interest rates as the Fed announced a reversal of the quantitative easing program into the end of the period. FUND REVIEW During the six-month period ended October 31, 2017, the Fund underperformed the Index due to its positioning in the Net Lease, Data Centers, and Specialty sectors. The Fund s strongest performance relative to the Index was in the Other, Industrial, Health Care, and Infrastructure sectors. 3 OPPENHEIMER REAL ESTATE FUND

4 The Net Lease Sector underperformed in the six month reporting period, but picked up in the last three months as tenant credit concerns from the second quarter were worked out. Both Spirit Realty Capital and STORE Capital Corporation outperformed on company specific issues. Spirit announced a spinoff to resolve some credit concerns regarding troubled retailer Shopko. STORE Capital announced an equity investment by Berkshire Hathaway, Warren Buffett s famed investment vehicle, which fixed the balance sheet and relieved investor credit concerns. The Fund had negative attribution in the Data Centers sector. The Fund was underweight this sector, which had positive returns in the period. Following a very strong leasing year in 2016, we believed valuations were expensive and that fundamentals would slow. However, due to the growth in the cloud and outsourcing, outperformance in this sector appears to be sustainable. In the Specialty sector, the Fund did not have exposure to Iron Mountain, which provides records storage and management. This company had very strong returns in the period, benefitting from cost savings as a result of last year s acquisition of Recall. The Fund was also overweight GEO Group, a prison REIT, which had negative returns in the period on an earnings miss. We still seem meaningful upside for this company at period end. The Fund had the strongest performance relative to the Index due to its positioning in the Other sector, mostly for its overweight position in Hilton, a hotel operating company, which had a 23% return in this period. Hotel stocks, including Hilton, outperformed in the period despite disruption by two major hurricanes, as investors looked for potential positive impacts from the growth initiatives proposed in the Republican tax bill. The Fund benefitted from its overweight position in the Industrial sector, which performed well as noted above. STRATEGY & OUTLOOK Overall, we continue to believe that U.S. REITs are an attractive investment in the current environment, with positive real estate fundamentals in most property sectors. At period end, demand remains steady for quality real estate, and overall new supply levels are in check. In addition, earnings growth is likely to re-accelerate for the REIT sector into next year. We will pay particular attention to noncore real estate sectors going into 2018, including Infrastructure REITS (cell towers), Single Family Rentals, and Timber, as many traditional property types are seeing decelerating rent growth and growing supply, which is likely to limit the pace of rent growth in the coming year. We believe that earnings growth will accelerate for Infrastructure, Single Family Rentals and Timber, and as a result, we believe that these sectors are more likely to experience multiple expansion than many core REIT sectors. We believe 4 OPPENHEIMER REAL ESTATE FUND

5 cell towers will benefit from increased use of smartphones. Most carriers now offer unlimited service, which will require more towers. Organic growth is expected to accelerate in this sector. Single-family homes currently benefit from demographics as more millennials are marrying and raising families and need the extra space a single-family residence can provide. Furthermore, the single-family rental segment is several years behind the rental growth curve versus multifamily, and has more upside in its potential rent growth versus the multi-family segment. We believe Timber will be a beneficiary of growing single-family home starts, plus rebuilding from hurricanes and fire damage in Northern California. Within core sectors, we are focused on the Industrial sector due to strong demand drivers. We are optimistic that the U.S. recovery will continue, and we believe our portfolio is positioned to benefit from its growth. REIT performance will continue to be bifurcated among segments, depending on the nature of the economy s growth, as well as fundamental trends such as evolving consumer demand due to ecommerce. We see the downside risks of geopolitical events increasing. Although it does appear that tax reform will pass as of the end of the reporting period, the full effects of President Trump s economic initiatives remain unknown and we believe that there could be policy-driven volatility in the coming quarters. The proposed tax plan would have a mixed effect on the REIT sector. REITs would benefit from higher corporate profits and higher discretionary income for most consumers, but the positive effects for REITs would likely lag those of companies that pay taxes. In addition, certain aspects of the proposed reform could affect the various REIT subsectors/geographies differently. For example, adjusting the mortgage deductibility could reduce the relative attractiveness of homeownership versus renting at the high end and boost Class A apartment demand, while repealing the state and local income tax deduction would negatively impact earners in high income tax states. The tax situation remains fluid and could undergo more changes before being passed, so we remain cognizant of the various put and takes affecting the REIT asset class. David Wharmby, CFA Portfolio Manager. The Portfolio Manager is employed by the Fund s sub-sub-adviser, Barings LLC. The opinions of the Portfolio Manager do not necessarily reflect the opinions of OppenheimerFunds. 5 OPPENHEIMER REAL ESTATE FUND

6 Top Holdings and Allocations TOP TEN COMMON STOCK HOLDINGS Prologis, Inc. 7.7% Simon Property Group, Inc. 5.4 Equinix, Inc. 5.3 Digital Realty Trust, Inc. 5.0 Essex Property Trust, Inc. 4.5 Welltower, Inc. 4.3 Invitation Homes, Inc. 4.3 Boston Properties, Inc. 4.1 Duke Realty Corp. 4.0 Camden Property Trust 3.6 Portfolio holdings and allocations are subject to change. Percentages are as of October 31, 2017, and are based on net assets. For more current Fund holdings, please visit oppenheimerfunds. com. SECTOR ALLOCATION Specialized REITs 23.0% Retail REITs 18.5 Residential REITs 14.4 Office REITs 13.4 Industrial REITs 11.7 Health Care REITs 11.6 Hotel & Resort REITs 3.1 Hotels, Resorts & Leisure 2.1 Diversified REITs 1.2 Investment Company 1.0 Portfolio holdings and allocations are subject to change. Percentages are as of October 31, 2017, and are based on market value of total investments. 6 OPPENHEIMER REAL ESTATE FUND

7 Share Class Performance AVERAGE ANNUAL TOTAL RETURNS WITHOUT SALES CHARGE AS OF 10/31/17 Inception Date 6-Month 1-Year 5-Year 10-Year Class A (OREAX) 3/4/ % 3.27% 9.03% 5.03% Class B (OREBX) 10/1/ Class C (ORECX) 10/1/ Class I (OREIX) 8/28/ * Class R (ORENX) 10/1/ Class Y (OREYX) 10/1/ AVERAGE ANNUAL TOTAL RETURNS WITH SALES CHARGE AS OF 10/31/17 Inception Date 6-Month 1-Year 5-Year 10-Year Class A (OREAX) 3/4/ % -2.67% 7.75% 4.41% Class B (OREBX) 10/1/ Class C (ORECX) 10/1/ Class I (OREIX) 8/28/ * Class R (ORENX) 10/1/ Class Y (OREYX) 10/1/ * Shows performance since inception. Performance data quoted represents past performance, which does not guarantee future results. The investment return and principal value of an investment in the Fund will fluctuate so that an investor s shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance quoted. Returns do not consider capital gains or income taxes on an individual s investment. For performance data current to the most recent month-end, visit oppenheimerfunds.com or call CALL OPP ( ). Fund returns include changes in share price, reinvested distributions, and the applicable sales charge: for Class A shares, the current maximum initial sales charge of 5.75%; for Class B shares, the contingent deferred sales charge of 5% (1-year) and 2% (5-year); and for Class C shares, the contingent deferred sales charge of 1% for the 1-year period. There is no sales charge for Class I, Class R and Class Y shares. Because Class B shares convert to Class A shares 72 months after purchase, the 10-year return for Class B shares uses Class A performance for the period after conversion. Returns for periods of less than one year are cumulative and not annualized. See Fund prospectuses and summary prospectuses for more information on share classes and sales charges. The FTSE NAREIT (National Association of Real Estate Investment Trusts) Equity REIT Index consists of certain companies that own and operate income-producing real estate that have 75% or more of their respective gross invested assets in the equity or mortgage debt of commercial properties. The Index is unmanaged and cannot be purchased directly by investors. While index comparisons may be useful to provide a benchmark for the Fund s performance, it must be noted that the Fund s investments are not limited to the investments comprising the Index. Index performance includes reinvestment of income, but does not reflect transaction costs, fees, expenses or taxes. Index performance is shown for illustrative purposes only as 7 OPPENHEIMER REAL ESTATE FUND

8 a benchmark for the Fund's performance, and does not predict or depict performance of the Fund. The Fund's performance reflects the effects of the Fund's business and operating expenses. The Fund's investment strategy and focus can change over time. The mention of specific fund holdings does not constitute a recommendation by OppenheimerFunds, Inc. or its affiliates. Before investing in any of the Oppenheimer funds, investors should carefully consider a fund's investment objectives, risks, charges and expenses. Fund prospectuses and summary prospectuses contain this and other information about the funds, and may be obtained by asking your financial advisor, visiting oppenheimerfunds.com, or calling CALL OPP ( ). Read prospectuses and summary prospectuses carefully before investing. Shares of Oppenheimer funds are not deposits or obligations of any bank, are not guaranteed by any bank, are not insured by the FDIC or any other agency, and involve investment risks, including the possible loss of the principal amount invested. 8 OPPENHEIMER REAL ESTATE FUND

9 Fund Expenses Fund Expenses. As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, which may include sales charges (loads) on purchase payments and/or contingent deferred sales charges on redemptions; and (2) ongoing costs, including management fees; distribution and service fees; and other Fund expenses. These examples are intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds. The examples are based on an investment of $1, invested at the beginning of the period and held for the entire 6-month period ended October 31, Actual Expenses. The first section of the table provides information about actual account values and actual expenses. You may use the information in this section for the class of shares you hold, together with the amount you invested, to estimate the expense that you paid over the period. Simply divide your account value by $1, (for example, an $8, account value divided by $1, = 8.60), then multiply the result by the number in the first section under the heading entitled Expenses Paid During 6 Months Ended October 31, 2017 to estimate the expenses you paid on your account during this period. Hypothetical Example for Comparison Purposes. The second section of the table provides information about hypothetical account values and hypothetical expenses based on the Fund s actual expense ratio for each class of shares, and an assumed rate of return of 5% per year for each class before expenses, which is not the Fund's actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and 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 the other funds. Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as front-end or contingent deferred sales charges (loads). Therefore, the hypothetical section of the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher. 9 OPPENHEIMER REAL ESTATE FUND

10 Actual Beginning Account Value May 1, 2017 Ending Account Value October 31, 2017 Expenses Paid During 6 Months Ended October 31, 2017 Class A $ 1, $ 1, $ 6.81 Class B 1, , Class C 1, , Class I 1, , Class R 1, , Class Y 1, , Hypothetical (5% return before expenses) Class A 1, , Class B 1, , Class C 1, , Class I 1, , Class R 1, , Class Y 1, , Expenses are equal to the Fund s annualized expense ratio for that class, multiplied by the average account value over the period, multiplied by 184/365 (to reflect the one-half year period). Those annualized expense ratios, excluding indirect expenses from affiliated funds, based on the 6-month period ended October 31, 2017 are as follows: Class Expense Ratios Class A 1.34% Class B 2.12 Class C 2.10 Class I 0.91 Class R 1.59 Class Y 1.10 The expense ratios reflect voluntary and/or contractual waivers and/or reimbursements of expenses by the Fund s Manager and Transfer Agent. Some of these undertakings may be modified or terminated at any time, as indicated in the Fund's prospectus. The Financial Highlights tables in the Fund s financial statements, included in this report, also show the gross expense ratios, without such waivers or reimbursements and reduction to custodian expenses, if applicable. 10 OPPENHEIMER REAL ESTATE FUND

11 STATEMENT OF INVESTMENTS October 31, 2017 Unaudited Shares Value Common Stocks 98.8% Consumer Discretionary 2.1% Hotels, Restaurants & Leisure 2.1% Hilton Worldwide Holdings, Inc. 328,606 $ 23,751,642 Financials 96.7% Real Estate Investment Trusts (REITs) 96.7% Diversified REITs 1.2% STORE Capital Corp. 554,430 13,688,877 Health Care REITs 11.6% Healthcare Realty Trust, Inc. 395,490 12,750,598 Medical Properties Trust, Inc. 940,900 12,448,107 National Health Investors, Inc. 173,969 13,254,698 Physicians Realty Trust 1,473,250 25,605,085 Ventas, Inc. 280,522 17,602,755 Welltower, Inc. 710,847 47,598, ,259,558 Hotel & Resort REITs 3.1% Chesapeake Lodging Trust 455,740 12,715,146 Park Hotels & Resorts, Inc. 215,761 6,211,759 Sunstone Hotel Investors, Inc. 983,240 16,046,477 34,973,382 Industrial REITs 11.7% Duke Realty Corp. 1,559,960 44,427,661 Prologis, Inc. 1,333,424 86,112, ,540,183 Office REITs 13.3% Boston Properties, Inc. 375,339 45,483,580 Brandywine Realty Trust 834,519 14,595,737 Cousins Properties, Inc. 2,336,030 21,070,990 Hudson Pacific Properties, Inc. 539,500 18,245,890 Kilroy Realty Corp. 475,834 33,893,656 Paramount Group, Inc. 986,980 15,712, ,002,575 Residential REITs 14.3% Camden Property Trust 436,390 39,816,224 Shares Value Residential REITs (Continued) Essex Property Trust, Inc. 191,180 $ 50,171,367 Invitation Homes, Inc. 2,108,540 47,589,748 Mid-America Apartment Communities, Inc. 222,109 22,732, ,310,195 Retail REITs 18.5% Acadia Realty Trust 896,928 25,248,523 Agree Realty Corp. 377,920 17,871,837 Kimco Realty Corp. 886,490 16,098,658 Macerich Co. (The) 204,840 11,184,264 Realty Income Corp. 431,110 23,137,674 Regency Centers Corp. 620,899 38,216,333 Retail Properties of America, Inc., Cl. A 1,184,780 14,478,012 Simon Property Group, Inc. 390,787 60,700, ,936,246 Specialized REITs 23.0% American Tower Corp. 160,820 23,105,010 Crown Castle International Corp. 170,430 18,249,644 CubeSmart 889,000 24,198,580 Digital Realty Trust, Inc. 473,850 56,122,794 Equinix, Inc. 128,160 59,402,160 Extra Space Storage, Inc. 161,220 13,153,940 Gaming & Leisure Properties, Inc. 549,235 20,069,047 GEO Group, Inc. (The) 721,415 18,720,719 Weyerhaeuser Co. 650,940 23,375, ,397,148 Total Common Stocks (Cost $945,834,752) 1,104,859, OPPENHEIMER REAL ESTATE FUND

12 STATEMENT OF INVESTMENTS Unaudited / Continued Shares Value Investment Company 1.0% Oppenheimer Institutional Government Money Market Fund, Cl. E, 1.01% 1,2 (Cost $10,712,777) 10,712,777 $ 10,712,777 Total Investments, at Value (Cost $956,547,529) 99.8% 1,115,572,583 Net Other Assets (Liabilities) 0.2 1,701,270 Net Assets 100.0% $ 1,117,273,853 Footnotes to Statement of Investments 1. Is or was an affiliate, as defined in the Investment Company Act of 1940, as amended, at or during the reporting period, by virtue of the Fund owning at least 5% of the voting securities of the issuer or as a result of the Fund and the issuer having the same investment adviser. Transactions during the reporting period in which the issuer was an affiliate are as follows: Shares Gross Gross Shares April 30, 2017 Additions Reductions October 31, 2017 Oppenheimer Institutional Government Money Market Fund, Cl. E 14,836, ,034, ,158,009 10,712,777 Realized Gain (Loss) Change in Unrealized Gain (Loss) Value Income Oppenheimer Institutional Government Money Market Fund, Cl. E $ 10,712,777 $ 38,645 $ $ 2. Rate shown is the 7-day yield at period end. See accompanying Notes to Financial Statements. 12 OPPENHEIMER REAL ESTATE FUND

13 STATEMENT OF ASSETS AND LIABILITIES October 31, 2017 Unaudited Assets Investments, at value see accompanying statement of investments: Unaffiliated companies (cost $945,834,752) $ 1,104,859,806 Affiliated companies (cost $10,712,777) 10,712,777 1,115,572,583 Cash 8,523,608 Receivables and other assets: Shares of beneficial interest sold 1,176,298 Dividends 429,281 Other 72,154 Total assets 1,125,773,924 Liabilities Payables and other liabilities: Investments purchased 5,971,268 Shares of beneficial interest redeemed 2,267,935 Distribution and service plan fees 142,985 Trustees' compensation 73,018 Shareholder communications 11,185 Other 33,680 Total liabilities 8,500,071 Net Assets $ 1,117,273,853 Composition of Net Assets Par value of shares of beneficial interest $ 44,389 Additional paid-in capital 931,309,891 Accumulated net investment loss (24,447,386) Accumulated net realized gain on investments 51,341,905 Net unrealized appreciation on investments 159,025,054 Net Assets $ 1,117,273, OPPENHEIMER REAL ESTATE FUND

14 STATEMENT OF ASSETS AND LIABILITIES Unaudited / Continued Net Asset Value Per Share Class A Shares: Net asset value and redemption price per share (based on net assets of $466,712,060 and 18,571,916 shares of beneficial interest outstanding) $25.13 Maximum offering price per share (net asset value plus sales charge of 5.75% of offering price) $26.66 Class B Shares: Net asset value, redemption price (excludes applicable contingent deferred sales charge) and offering price per share (based on net assets of $2,947,317 and 120,020 shares of beneficial interest outstanding) $24.56 Class C Shares: Net asset value, redemption price (excludes applicable contingent deferred sales charge) and offering price per share (based on net assets of $91,670,713 and 3,749,196 shares of beneficial interest outstanding) $24.45 Class I Shares: Net asset value, redemption price and offering price per share (based on net assets of $204,608,052 and 8,058,937 shares of beneficial interest outstanding) $25.39 Class R Shares: Net asset value, redemption price (excludes applicable contingent deferred sales charge) and offering price per share (based on net assets of $97,440,907 and 3,897,487 shares of beneficial interest outstanding) $25.00 Class Y Shares: Net asset value, redemption price and offering price per share (based on net assets of $253,894,804 and 9,991,136 shares of beneficial interest outstanding) $25.41 See accompanying Notes to Financial Statements. 14 OPPENHEIMER REAL ESTATE FUND

15 STATEMENT OF OPERATIONS For the Six Months Ended October 31, 2017 Unaudited Investment Income Dividends: Unaffiliated companies $ 14,003,537 Affiliated companies 38,645 Interest 15,376 Total investment income 14,057,558 Expenses Management fees 5,726,298 Distribution and service plan fees: Class A 609,046 Class B 19,878 Class C 493,176 Class R 254,198 Transfer and shareholder servicing agent fees: Class A 549,835 Class B 4,385 Class C 108,784 Class I 31,792 Class R 112,255 Class Y 289,075 Shareholder communications: Class A 12,453 Class B 583 Class C 3,055 Class I 893 Class R 868 Class Y 3,394 Borrowing fees 17,556 Trustees' compensation 7,899 Custodian fees and expenses 3,351 Other 43,598 Total expenses 8,292,372 Less waivers and reimbursements of expenses (666,932) Net expenses 7,625,440 Net Investment Income 6,432,118 Realized and Unrealized Gain (Loss) Net realized gain on investment transactions in unaffiliated companies 31,783,115 Net change in unrealized appreciation/depreciation on investment transactions in unaffiliated companies (27,156,898) Net Increase in Net Assets Resulting from Operations $ 11,058,335 See accompanying Notes to Financial Statements. 15 OPPENHEIMER REAL ESTATE FUND

16 STATEMENTS OF CHANGES IN NET ASSETS Six Months Ended October 31, 2017 (Unaudited) April 30, 2017 Operations Net investment income $ 6,432,118 $ 9,490,088 Net realized gain 31,783, ,221,556 Net change in unrealized appreciation/depreciation (27,156,898) (83,048,598) Net increase in net assets resulting from operations 11,058,335 58,663,046 Dividends and/or Distributions to Shareholders Dividends from net investment income: Class A (3,173,984) (13,274,321) Class B (8,374) (123,247) Class C (276,995) (1,794,067) Class I (1,792,795) (5,320,415) Class R (535,818) (2,268,537) Class Y (2,011,970) (7,170,590) (7,799,936) (29,951,177) Distributions from net realized gain: Class A (56,628,837) Class B (739,880) Class C (11,445,041) Class I (19,650,504) Class R (10,952,668) Class Y (25,803,177) (125,220,107) Beneficial Interest Transactions Net increase (decrease) in net assets resulting from beneficial interest transactions: Class A (78,312,515) 9,786,701 Class B (2,146,446) (6,113,916) Class C (13,495,603) (6,810,183) Class I (11,157,749) 60,067,519 Class R (6,676,304) 484,346 Class Y 10,430,899 (135,148,889) (101,357,718) (77,734,422) Net Assets Total decrease (98,099,319) (174,242,660) Beginning of period 1,215,373,172 1,389,615,832 End of period (including accumulated net investment loss of $24,447,386 and $23,079,568, respectively) $ 1,117,273,853 $ 1,215,373,172 See accompanying Notes to Financial Statements. 16 OPPENHEIMER REAL ESTATE FUND

17 FINANCIAL HIGHLIGHTS Class A Six Months Ended October 31, 2017 (Unaudited) April 30, 2017 April 29, April 30, 2015 April 30, 2014 April 30, 2013 Per Share Operating Data Net asset value, beginning of period $25.06 $27.13 $28.23 $26.11 $25.90 $22.69 Income (loss) from investment operations: Net investment income Net realized and unrealized gain Total from investment operations Dividends and/or distributions to shareholders: Dividends from net investment income (0.16) (0.61) (0.56) (0.48) (0.35) (0.38) Distributions from net realized gain 0.00 (2.67) (2.04) (1.22) (0.00) Total dividends and/or distributions to shareholders (0.16) (3.28) (2.60) (1.70) (0.35) (0.38) Net asset value, end of period $25.13 $25.06 $27.13 $28.23 $26.11 $25.90 Total Return, at Net Asset Value % 4.59% 5.93% 14.70% 2.33% 16.08% Ratios/Supplemental Data Net assets, end of period (in thousands) $466,712 $543,858 $579,488 $638,707 $502,283 $508,853 Average net assets (in thousands) $495,425 $600,337 $576,678 $589,603 $466,636 $416,696 Ratios to average net assets: 5 Net investment income 1.05% 0.66% 1.59% 0.97% 1.19% 0.95% Expenses excluding specific expenses listed below 1.45% 1.43% 1.43% 1.42% 1.54% 1.66% Interest and fees from borrowings 0.00% % % % 0.00% 0.00% Total expenses % 1.43% 1.43% 1.42% 1.54% 1.66% Expenses after payments, waivers and/or reimbursements and reduction to custodian expenses 1.34% 1.33% 1.33% 1.32% 1.39% 1.49% Portfolio turnover rate 53% 114% 85% 60% 123% 94% 17 OPPENHEIMER REAL ESTATE FUND

18 FINANCIAL HIGHLIGHTS Continued 1. Represents the last business day of the Fund's reporting period. 2. Per share amounts calculated based on the average shares outstanding during the period. 3. Less than $0.005 per share. 4. Assumes an initial investment on the business day before the first day of the fiscal period, with all dividends and distributions reinvested in additional shares on the reinvestment date, and redemption at the net asset value calculated on the last business day of the fiscal period. Sales charges are not reflected in the total returns. Total returns are not annualized for periods less than one full year. Returns do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. 5. Annualized for periods less than one full year. 6. Less than 0.005%. 7. Total expenses including indirect expenses from affiliated fund fees and expenses were as follows: Six Months Ended October 31, % April 30, % April 29, % April 30, % April 30, % April 30, % See accompanying Notes to Financial Statements. 18 OPPENHEIMER REAL ESTATE FUND

19 Class B Six Months Ended October 31, 2017 (Unaudited) April 30, 2017 April 29, April 30, 2015 April 30, 2014 April 30, 2013 Per Share Operating Data Net asset value, beginning of period $24.48 $26.55 $27.66 $25.61 $25.42 $22.28 Income (loss) from investment operations: Net investment income Net realized and unrealized gain Total from investment operations Dividends and/or distributions to shareholders: Dividends from net investment income (0.05) (0.38) (0.34) (0.26) (0.19) (0.21) Distributions from net realized gain 0.00 (2.67) (2.04) (1.22) (0.00) Total dividends and/or distributions to shareholders (0.05) (3.05) (2.38) (1.48) (0.19) (0.21) Net asset value, end of period $24.56 $24.48 $26.55 $27.66 $25.61 $25.42 Total Return, at Net Asset Value % 3.80% 5.15% 13.80% 1.60% 15.19% Ratios/Supplemental Data Net assets, end of period (in thousands) $2,947 $5,068 $11,564 $16,988 $19,227 $26,043 Average net assets (in thousands) $3,940 $8,661 $13,992 $18,851 $20,698 $25,490 Ratios to average net assets: 5 Net investment income 0.27% 0.20% 1.06% 0.39% 0.63% 0.37% Expenses excluding specific expenses listed below 2.23% 2.19% 2.18% 2.18% 2.37% 2.56% Interest and fees from borrowings 0.00% % % % 0.00% 0.00% Total expenses % 2.19% 2.18% 2.18% 2.37% 2.56% Expenses after payments, waivers and/or reimbursements and reduction to custodian expenses 2.12% 2.09% 2.08% 2.08% 2.17% 2.25% Portfolio turnover rate 53% 114% 85% 60% 123% 94% 19 OPPENHEIMER REAL ESTATE FUND

20 FINANCIAL HIGHLIGHTS Continued 1. Represents the last business day of the Fund's reporting period. 2. Per share amounts calculated based on the average shares outstanding during the period. 3. Less than $0.005 per share. 4. Assumes an initial investment on the business day before the first day of the fiscal period, with all dividends and distributions reinvested in additional shares on the reinvestment date, and redemption at the net asset value calculated on the last business day of the fiscal period. Sales charges are not reflected in the total returns. Total returns are not annualized for periods less than one full year. Returns do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. 5. Annualized for periods less than one full year. 6. Less than 0.005%. 7. Total expenses including indirect expenses from affiliated fund fees and expenses were as follows: Six Months Ended October 31, % April 30, % April 29, % April 30, % April 30, % April 30, % See accompanying Notes to Financial Statements. 20 OPPENHEIMER REAL ESTATE FUND

21 Class C Six Months Ended October 31, 2017 (Unaudited) April 30, 2017 April 29, April 30, 2015 April 30, 2014 April 30, 2013 Per Share Operating Data Net asset value, beginning of period $24.39 $26.48 $27.61 $25.57 $25.40 $22.27 Income (loss) from investment operations: Net investment income (loss) (0.02) Net realized and unrealized gain Total from investment operations Dividends and/or distributions to shareholders: Dividends from net investment income (0.07) (0.41) (0.36) (0.27) (0.20) (0.22) Distributions from net realized gain 0.00 (2.67) (2.04) (1.22) (0.00) Total dividends and/or distributions to shareholders (0.07) (3.08) (2.40) (1.49) (0.20) (0.22) Net asset value, end of period $24.45 $24.39 $26.48 $27.61 $25.57 $25.40 Total Return, at Net Asset Value % 3.82% 5.14% 13.83% 1.55% 15.24% Ratios/Supplemental Data Net assets, end of period (in thousands) $91,671 $104,929 $120,654 $129,009 $98,260 $106,881 Average net assets (in thousands) $98,028 $119,534 $119,652 $115,951 $95,086 $87,802 Ratios to average net assets: 5 Net investment income (loss) 0.29% (0.08)% 0.82% 0.18% 0.46% 0.20% Expenses excluding specific expenses listed below 2.21% 2.18% 2.18% 2.17% 2.30% 2.42% Interest and fees from borrowings 0.00% % % % 0.00% 0.00% Total expenses % 2.18% 2.18% 2.17% 2.30% 2.42% Expenses after payments, waivers and/or reimbursements and reduction to custodian expenses 2.10% 2.08% 2.08% 2.07% 2.16% 2.25% Portfolio turnover rate 53% 114% 85% 60% 123% 94% 21 OPPENHEIMER REAL ESTATE FUND

22 FINANCIAL HIGHLIGHTS Continued 1. Represents the last business day of the Fund's reporting period. 2. Per share amounts calculated based on the average shares outstanding during the period. 3. Less than $0.005 per share. 4. Assumes an initial investment on the business day before the first day of the fiscal period, with all dividends and distributions reinvested in additional shares on the reinvestment date, and redemption at the net asset value calculated on the last business day of the fiscal period. Sales charges are not reflected in the total returns. Total returns are not annualized for periods less than one full year. Returns do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. 5. Annualized for periods less than one full year. 6. Less than 0.005%. 7. Total expenses including indirect expenses from affiliated fund fees and expenses were as follows: Six Months Ended October 31, % April 30, % April 29, % April 30, % April 30, % April 30, % See accompanying Notes to Financial Statements. 22 OPPENHEIMER REAL ESTATE FUND

23 Class I Six Months Ended October 31, 2017 (Unaudited) April 30, 2017 April 29, April 30, 2015 April 30, 2014 Period Ended April 30, Per Share Operating Data Net asset value, beginning of period $25.32 $27.38 $28.47 $26.32 $26.11 $23.15 Income (loss) from investment operations: Net investment income (loss) (0.13) Net realized and unrealized gain Total from investment operations Dividends and/or distributions to shareholders: Dividends from net investment income (0.22) (0.73) (0.69) (0.61) (0.47) (0.39) Distributions from net realized gain 0.00 (2.67) (2.04) (1.22) (0.00) Total dividends and/or distributions to shareholders (0.22) (3.40) (2.73) (1.83) (0.47) (0.39) Net asset value, end of period $25.39 $25.32 $27.38 $28.47 $26.32 $26.11 Total Return, at Net Asset Value % 5.04% 6.41% 15.22% 2.82% 14.70% Ratios/Supplemental Data Net assets, end of period (in thousands) $204,608 $215,127 $172,681 $153,137 $114,628 $75,460 Average net assets (in thousands) $210,247 $206,215 $147,821 $153,143 $106,092 $12,070 Ratios to average net assets: 6 Net investment income (loss) 1.47% 0.97% 1.96% 1.47% 1.36% (0.81)% Expenses excluding specific expenses listed below 1.01% 0.99% 0.99% 0.98% 1.03% 1.03% Interest and fees from borrowings 0.00% % % % 0.00% 0.00% Total expenses % 0.99% 0.99% 0.98% 1.03% 1.03% Expenses after payments, waivers and/or reimbursements and reduction to custodian expenses 0.91% 0.89% 0.89% 0.88% 0.90% 0.93% Portfolio turnover rate 53% 114% 85% 60% 123% 94% 23 OPPENHEIMER REAL ESTATE FUND

24 FINANCIAL HIGHLIGHTS Continued 1. Represents the last business day of the Fund's reporting period. 2. For the period from August 28, 2012 (inception of offering) to April 30, Per share amounts calculated based on the average shares outstanding during the period. 4. Less than $0.005 per share. 5. Assumes an initial investment on the business day before the first day of the fiscal period, with all dividends and distributions reinvested in additional shares on the reinvestment date, and redemption at the net asset value calculated on the last business day of the fiscal period. Sales charges are not reflected in the total returns. Total returns are not annualized for periods less than one full year. Returns do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. 6. Annualized for periods less than one full year. 7. Less than 0.005%. 8. Total expenses including indirect expenses from affiliated fund fees and expenses were as follows: Six Months Ended October 31, % April 30, % April 29, % April 30, % April 30, % Period Ended April 30, % See accompanying Notes to Financial Statements. 24 OPPENHEIMER REAL ESTATE FUND

25 Class R Six Months Ended October 31, 2017 (Unaudited) April 30, 2017 April 29, April 30, 2015 April 30, 2014 April 30, 2013 Per Share Operating Data Net asset value, beginning of period $24.94 $27.01 $28.11 $26.01 $25.80 $22.60 Income (loss) from investment operations: Net investment income Net realized and unrealized gain Total from investment operations Dividends and/or distributions to shareholders: Dividends from net investment income (0.13) (0.54) (0.49) (0.41) (0.29) (0.33) Distributions from net realized gain 0.00 (2.67) (2.04) (1.22) (0.00) Total dividends and/or distributions to shareholders (0.13) (3.21) (2.53) (1.63) (0.29) (0.33) Net asset value, end of period $25.00 $24.94 $27.01 $28.11 $26.01 $25.80 Total Return, at Net Asset Value % 4.34% 5.68% 14.39% 2.08% 15.82% Ratios/Supplemental Data Net assets, end of period (in thousands) $97,441 $103,838 $112,028 $112,993 $88,540 $84,482 Average net assets (in thousands) $101,204 $115,032 $106,969 $104,767 $78,539 $70,768 Ratios to average net assets: 5 Net investment income 0.80% 0.40% 1.31% 0.72% 0.89% 0.68% Expenses excluding specific expenses listed below 1.70% 1.68% 1.68% 1.67% 1.80% 1.97% Interest and fees from borrowings 0.00% % % % 0.00% 0.00% Total expenses % 1.68% 1.68% 1.67% 1.80% 1.97% Expenses after payments, waivers and/or reimbursements and reduction to custodian expenses 1.59% 1.58% 1.58% 1.57% 1.64% 1.75% Portfolio turnover rate 53% 114% 85% 60% 123% 94% 25 OPPENHEIMER REAL ESTATE FUND

26 FINANCIAL HIGHLIGHTS Continued 1. Represents the last business day of the Fund's reporting period. 2. Per share amounts calculated based on the average shares outstanding during the period. 3. Less than $0.005 per share. 4. Assumes an initial investment on the business day before the first day of the fiscal period, with all dividends and distributions reinvested in additional shares on the reinvestment date, and redemption at the net asset value calculated on the last business day of the fiscal period. Sales charges are not reflected in the total returns. Total returns are not annualized for periods less than one full year. Returns do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. 5. Annualized for periods less than one full year. 6. Less than 0.005%. 7. Total expenses including indirect expenses from affiliated fund fees and expenses were as follows: Six Months Ended October 31, % April 30, % April 29, % April 30, % April 30, % April 30, % See accompanying Notes to Financial Statements. 26 OPPENHEIMER REAL ESTATE FUND

27 Class Y Six Months Ended October 31, 2017 (Unaudited) April 30, 2017 April 29, April 30, 2015 April 30, 2014 April 30, 2013 Per Share Operating Data Net asset value, beginning of period $25.34 $27.40 $28.48 $26.33 $26.11 $22.87 Income (loss) from investment operations: Net investment income Net realized and unrealized gain Total from investment operations Dividends and/or distributions to shareholders: Dividends from net investment income (0.20) (0.68) (0.63) (0.55) (0.40) (0.45) Distributions from net realized gain 0.00 (2.67) (2.04) (1.22) (0.00) Total dividends and/or distributions to shareholders (0.20) (3.35) (2.67) (1.77) (0.40) (0.45) Net asset value, end of period $25.41 $25.34 $27.40 $28.48 $26.33 $26.11 Total Return, at Net Asset Value % 4.87% 6.22% 14.97% 2.57% 16.44% Ratios/Supplemental Data Net assets, end of period (in thousands) $253,895 $242,553 $393,201 $412,271 $345,270 $353,450 Average net assets (in thousands) $260,799 $292,395 $390,618 $390,060 $299,697 $370,017 Ratios to average net assets: 5 Net investment income 1.29% 1.07% 1.84% 1.25% 1.44% 1.39% Expenses excluding specific expenses listed below 1.21% 1.18% 1.18% 1.18% 1.30% 1.21% Interest and fees from borrowings 0.00% % % % 0.00% 0.00% Total expenses % 1.18% 1.18% 1.18% 1.30% 1.21% Expenses after payments, waivers and/or reimbursements and reduction to custodian expenses 1.10% 1.08% 1.08% 1.08% 1.17% 1.18% Portfolio turnover rate 53% 114% 85% 60% 123% 94% 27 OPPENHEIMER REAL ESTATE FUND

28 FINANCIAL HIGHLIGHTS Continued 1. Represents the last business day of the Fund's reporting period. 2. Per share amounts calculated based on the average shares outstanding during the period. 3. Less than $0.005 per share. 4. Assumes an initial investment on the business day before the first day of the fiscal period, with all dividends and distributions reinvested in additional shares on the reinvestment date, and redemption at the net asset value calculated on the last business day of the fiscal period. Sales charges are not reflected in the total returns. Total returns are not annualized for periods less than one full year. Returns do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. 5. Annualized for periods less than one full year. 6. Less than 0.005%. 7. Total expenses including indirect expenses from affiliated fund fees and expenses were as follows: Six Months Ended October 31, % April 30, % April 29, % April 30, % April 30, % April 30, % See accompanying Notes to Financial Statements. 28 OPPENHEIMER REAL ESTATE FUND

29 NOTES TO FINANCIAL STATEMENTS October 31, 2017 Unaudited 1. Organization Oppenheimer Real Estate Fund (the Fund ) is registered under the Investment Company Act of 1940 ( 1940 Act ), as amended, as a non-diversified open-end management investment company. The Fund s investment objective is to seek total return. The Fund s investment adviser is OFI Global Asset Management, Inc. ( OFI Global or the Manager ), a whollyowned subsidiary of OppenheimerFunds, Inc, ( OFI or the Sub-Adviser ). The Manager has entered into a sub-advisory agreement with OFI. The Sub-Advisor has entered into a sub-subadvisory agreement with Barings LLC (the Sub-Sub-Adviser ), an indirect, wholly-owned subsidiary of Massachusetts Mutual Life Insurance Company, the parent of OFI. The Fund offers Class A, Class C, Class I, Class R and Class Y shares, and previously offered Class B shares for new purchase through June 29, Subsequent to that date, no new purchases of Class B shares are permitted, however reinvestment of dividend and/or capital gain distributions and exchanges of Class B shares into and from other Oppenheimer funds are allowed. Class A shares are sold at their offering price, which is normally net asset value plus a front-end sales charge. Class C and Class R shares are sold, and Class B shares were sold, without a front-end sales charge but may be subject to a CDSC. Class R shares are sold only through retirement plans. Retirement plans that offer Class R shares may impose charges on those accounts. Class I and Class Y shares are sold to certain institutional investors or intermediaries without either a front-end sales charge or a CDSC, however, the intermediaries may impose charges on their accountholders who beneficially own Class I and Class Y shares. All classes of shares have identical rights and voting privileges with respect to the Fund in general and exclusive voting rights on matters that affect that class alone. Earnings, net assets and net asset value per share may differ due to each class having its own expenses, such as transfer and shareholder servicing agent fees and shareholder communications, directly attributable to that class. Class A, B, C and R shares have separate distribution and/or service plans under which they pay fees. Class I and Class Y shares do not pay such fees. Class B shares will automatically convert to Class A shares 72 months after the date of purchase. The following is a summary of significant accounting policies followed in the Fund's preparation of financial statements in accordance with accounting principles generally accepted in the United States ( U.S. GAAP ). 2. Significant Accounting Policies Security Valuation. All investments in securities are recorded at their estimated fair value, as described in Note 3. Allocation of Income, Expenses, Gains and Losses. Income, expenses (other than those attributable to a specific class), gains and losses are allocated on a daily basis to each class of shares based upon the relative proportion of net assets represented by such class. Operating expenses directly attributable to a specific class are charged against the operations of that class. Dividends and Distributions to Shareholders. Dividends and distributions to 29 OPPENHEIMER REAL ESTATE FUND

30 NOTES TO FINANCIAL STATEMENTS Unaudited / Continued 2. Significant Accounting Policies (Continued) shareholders, which are determined in accordance with income tax regulations and may differ from U.S. GAAP, are recorded on the ex-dividend date. Income distributions, if any, are declared and paid quarterly. Capital gain distributions, if any, are declared and paid annually or at other times as deemed necessary by the Manager. The tax character of distributions is determined as of the Fund s fiscal year end. Therefore, a portion of the Fund s distributions made to shareholders prior to the Fund s fiscal year end may ultimately be categorized as a tax return of capital. Investment Income. Dividend income is recorded on the ex-dividend date or upon exdividend notification in the case of certain foreign dividends where the ex-dividend date may have passed. Upon receipt of notification from the issuer, subsequent to the ex-dividend date, some of the dividend income originally recorded from a real estate investment trust ( REIT ) may be reclassified as a reduction of the cost of the related investment and/or realized gain. Non-cash dividends included in dividend income, if any, are recorded at the fair market value of the securities received. Interest income is recognized on an accrual basis. Discount and premium, which are included in interest income on the Statement of Operations, are amortized or accreted daily. Return of Capital Estimates. Distributions received from the Fund s investments in Real Estate Investments Trusts (REITs), generally are comprised of income and return of capital. The Fund records investment income and return of capital based on estimates. Such estimates are based on historical information available from each REIT and other industry sources. These estimates may subsequently be revised based on information received from REITs after their tax reporting periods are concluded. Custodian Fees. Custodian fees and expenses in the Statement of Operations may include interest expense incurred by the Fund on any cash overdrafts of its custodian account during the period. Such cash overdrafts may result from the effects of failed trades in portfolio securities and from cash outflows resulting from unanticipated shareholder redemption activity. Prior to July 17, 2017, the Fund paid interest to its custodian on such cash overdrafts, to the extent they were not offset by positive cash balances maintained by the Fund, when applicable, at a rate equal to the negative rolling average balance at an average Federal Funds Rate plus 0.50%. This rate increased to the Prime Rate plus 0.35% effective July 17, The Reduction to custodian expenses line item, if applicable, represents earnings on cash balances maintained by the Fund during the period. Such interest expense and other custodian fees may be paid with these earnings. Security Transactions. Security transactions are recorded on the trade date. Realized gains and losses on securities sold are determined on the basis of identified cost. Indemnifications. The Fund s organizational documents provide current and former Trustees and officers with a limited indemnification against liabilities arising in connection with the 30 OPPENHEIMER REAL ESTATE FUND