Prudential Investment Portfolios 12
655 Broad Street
Newark, New Jersey 07102
December 27, 2017
VIA EDGAR SUBMISSION
Mr. Alberto Zapata
Division of Investment Management
U.S. Securities and Exchange Commission
100 F Street, N.E.
Washington, D.C. 20549
Re:Prudential Global Real Estate Fund
Post-Effective Amendment No. 51 to the Form N-1A Registration Statement
under the Securities Act of 1933;
Amendment No. 52 to the Form N-1A Registration Statement
under the Investment Company Act of 1940
Securities Act Registration No. 033-42705
Investment Company Act No. 811-08565
Dear Mr. Zapata:
We filed with the Securities and Exchange Commission (the Commission) through EDGAR on October 11, 2017 on behalf of Prudential Investment Portfolios 12 (the Trust) the above-referenced post-effective amendment (the Amendment). The Amendment was filed under Rule 485(a)(1) under the Securities Act of 1933 (1933 Act) solely for the purpose of adding two new classes of shares to the Prudential Global Real Estate Fund (the Fund), which is a series of the Trust. The new classes of shares are known as Class R2 and Class R4.
This letter is intended to respond to the Commission Staff’s comments that you conveyed by telephone on November 28, 2017 with respect to the Amendment. For your convenience, a summary of your comments are included herein and the responses are keyed accordingly, as set forth below. Capitalized terms used herein, and not otherwise defined, have the respective meanings assigned in the Amendment.
GENERAL COMMENTS:
1.Comment: Please complete and update all blanks and bracketed items which appear in the Amendment in the Registrant’s next post-effective amendment filing.
Response: We hereby confirm that all blanks and/or incomplete information will be supplied and included in the Registrant’s next post-effective amendment filing.
2.Comment: Please submit these comments and the Registrant’s responses thereto as a Correspondence submission on EDGAR addressed to Mr. Alberto Zapata prior to the effectiveness of the Amendment.
Response:The staff’s comments and the Registrant’s responses thereto, will be submitted and filed on EDGAR as Correspondence, addressed to you, prior to the effectiveness of the Amendment.
3.Comment: Please note that the company and its management are responsible for the adequacy and accuracy of the disclosures contained in the Amendment, notwithstanding any review, comments, action or absence of action taken by the Commission Staff.
Response:We hereby confirm our understanding, as described above.
4.Comment: Please confirm that the applicable EDGAR Series and Class ID information will be updated to reflect the inclusion of Class R2 and R4 shares for the Fund.
Response: The EDGAR Series and Class ID information for the Funds will be updated to include the relevant information pertaining to the Class R2 and Class R4 shares of the Fund.
5.Comment: To the extent that a comment furnished with respect to a specific prospectus or statement of additional information is applicable to other prospectuses and/or statements of additional information, your response should be considered to similarly apply to all such other prospectuses and/or statements of additional information.
Response: Comments which have applicability to other prospectuses and/or statements of additional information in the fund complex will be applied accordingly.
6.Comment: In the Prospectus, in the section entitled “Fund Summary—Fund Fees and Expenses,” please consider revising all whole numbers in this and other numeric tables so that all whole numbers are followed by “.00.” Example: please revise the figure 1% so that it reads 1.00%.
Response: The requested revisions have been made in the Prospectus, as well as in the SAI.
COMMENTS ON THE PROSPECTUS:
7.Comment: In the Prospectus, in the section entitled “Fund Summary—Investments, Risks and Performance—Principal Investment Strategies,” the disclosure states, in relevant part, that: ”Under normal circumstances, the Fund invests in at least three different countries and at least 40% of its total assets in foreign securities.”
Please include disclosure explaining how the Fund defines a security as a “foreign” security.
Response: In response to this comment, the disclosure has been revised to include a definition of how the Fund defines a security as “foreign.”
8.Comment: In the Prospectus, in the section entitled “Fund Summary—Investments, Risks and Performance—Principal Risks,” there is disclosure pertaining to “Emerging Markets Risk.” The Fund’s investments in emerging markets should be discussed as a principal strategy in the Fund Summary. In addition, please include disclosure explaining how emerging markets are defined by the Fund.
Response: In response to this comment, the disclosure has been revised to include discussion of emerging markets, including how the Fund defines emerging markets.
9.Comment: In the Prospectus, in the section entitled “Fund Summary—Buying and Selling Fund Shares,” the following disclosure appears: “Important Note: Class R2 and Class R4 shares are not available for purchase until on or about June 1, 2018.” Please explain why there is such a long lead time prior to when these new share classes will be available for sale.
Response: There are several reasons why the new share classes will not be available until June 2018. First, the Fund’s investment manager, in consultation with the Fund’s Board of Directors, determined that it was important to provide new investors and new group retirement plans sufficient time to process and prepare for this change. Retirement plans typically have a long implementation time frame, and usually require significant lead time in order to prepare and implement the systems changes necessary to support a new share class.
Secondly, as also noted in the Prospectus, the Fund intends to close Class A, Class C, Class Z and Class R shares to most new group retirement plan investments, also to be effective on June 19, 2018. The Fund’s investment manager, in consultation with the Fund’s Board of Directors, determined that it could be confusing and detrimental to the Fund and its investors if the new share classes were open and available for investment prior to when the Fund’s Class A, Class C, Class Z and Class R shares would be closed.
10.Comment: In the Prospectus, in the section entitled “More About the Fund’s Principal and Non-Principal Investment Strategies, Investments and Risks—Past Performance,” please consider re-positioning the FTSE EPRA/NAREIT Developed Index and the S&P 500 Index so that the S&P 500 Index appears first, followed by the FTSE EPRA/NAREIT Developed Index.
Response: After careful consideration, the Fund respectfully declines to alter the order in which the indexes appear in the Prospectus, since the use of additional securities indexes is permissible under Form N-1A, and the presentation order is not specifically mandated by Form N-1A. The Fund also believes that the FTSE EPRA/NAREIT Developed Index is more directly relevant to how the Fund is managed for purposes of Fund performance comparisons.
11.Comment: In the Prospectus, in the section entitled “More About the Fund’s Principal and Non-Principal Investment Strategies, Investments and Risks—Investments and Investment Strategies,” there is extensive discussion of the Fund’s use of derivatives. Please include discussion pertaining to derivatives in the discussion of principal investment strategies in the Fund Summary if derivative strategies are a principal investment strategy of the Fund.
Response: Derivative strategies are not a principal investment strategy for the Fund.
12.Comment: In the Prospectus, in the section entitled “More About the Fund’s Principal and Non-Principal Investment Strategies, Investments and Risks—Investments and Investment Strategies,” in the table entitled “Principal and Non-Principal Strategies,” please differentiate/segregate the table so that principal and non-principal strategies are grouped separately. Also, please include in the discussion of the Fund’s principal investment strategies which appears in the Fund Summary any percentage limitations appearing in this table which are applicable to the Fund’s principal investment strategies.
Response: Upon review, we believe that the existing presentation and order complies with the requirements of Form N-1A, and therefore we respectfully decline the Staff’s comment.
13.Comment: In the Prospectus, in the section entitled “More About the Fund’s Principal and Non-Principal Investment Strategies, Investments and Risks—Risks of Investing in the Fund,” please revise the discussion of “Exchange Traded Funds (ETF) Risk” so that it also discusses premium discount risk and other specific risks associated with investing in ETFs.
Response: In response to this comment, the discussion of ETF Risks has been revised accordingly.
14.Comment: In the Prospectus, in the section entitled “How to Buy, Sell and Exchange Fund Shares—How to Buy Shares,” please include a discussion and explanation of “dealer reallowance,” since the sales charge table which appears in this section identifies the amount of dealer reallowance that is paid based on different sales charge amounts.
Response: In response to this comment, the Prospectus has been revised to include an explanation of the term “dealer reallowance.”
15.Comment: In the Prospectus, in the section entitled “How to Buy, Sell and Exchange Fund Shares,” please confirm that the language and disclosures which explain the sales charges, loads, discounts and breakpoints applicable to various intermediaries conforms to the language and disclosures agreed upon by the Staff and Ms. Claudia DiGiacomo of PGIM Investments.
Response: Confirmed.
Sincerely yours,
/s/ Jonathan D. Shain
Jonathan D. Shain
Vice President & Corporate Counsel