Why investors are rushing into real estate ETFs

Beyond reopening, fund purchases reflect optimism about storage, supply chains

National /
Jun.June 09, 2021 11:17 AM
Real Estate EFTs See Investment Amid Pandemic Recovery

The $6.2 billion iShares U.S. Real Estate ETF saw $1.3 billion of inflows last week. (Getty)

 

Investors are pouring money into real estate exchange-traded funds, in part as a bet on the storage and supply chain sectors.

The $6.2 billion iShares U.S. Real Estate ETF saw $1.3 billion of inflows last week, its most ever, making it the second biggest gainer among ETFs. The $41.4 billion Vanguard Real Estate ETF brought in $338 million following its $1.2 billion of inflows in May, according to Bloomberg News.

Though much of the activity in commercial real estate reflects optimism about reopening, the need for more data-related and supply-chain storage has remained consistent before and throughout the pandemic.

“It seems investors are using real-estate ETFs as a means of capitalizing on global logistics concerns,” Bloomberg Intelligence ETF analyst Athanasios Psarofagis told the publication.

Other real estate ETFs are expected to do similarly well as a strong demand for property, particularly residential assets, remains unmet because of low supply and the rising cost of building materials and labor.

“The big increases you’ve seen in single-family home prices is unprecedented in a recession and provides a lot of head room for apartment REITs,” BTIG analyst James Sullivan told Bloomberg.

[Bloomberg] — Sasha Jones





    Related Articles

    arrow_forward_ios
    9 Prospect Park West and 2 Northside Piers in Williamsburg (Photos via Google Maps and 2 Northside Piers/Facebook)
    A Park Slope co-op was one of the priciest deals inked last week
    A Park Slope co-op was one of the priciest deals inked last week
    42 Old Montauk Highway, Montauk
    The unsellables: Even in a hot market, these Hamptons homes don’t move
    The unsellables: Even in a hot market, these Hamptons homes don’t move
    220 Central Park South with Michael Cantanucci and 378 West End Avenue (Photos via Getty Images, Jim.henderson/Wikimedia, 378WEA)
    Discounts for Manhattan’s luxury homes have shrunk
    Discounts for Manhattan’s luxury homes have shrunk
    Gov. Andrew Cuomo (Getty/Illustration by Kevin Rebong)
    NY flooded with nearly 100K rent relief applications in two weeks
    NY flooded with nearly 100K rent relief applications in two weeks
    With major financial choices to make, Newmark receives $850M infusion
    With major financial choices to make, Newmark receives $850M infusion
    With major financial choices to make, Newmark receives $850M infusion
    Los Angeles, New York and Miami metro areas are in the top 10 of owner-occupied million dollar homes. (iStock)
    These metro areas have the most — and fewest — million-dollar homes
    These metro areas have the most — and fewest — million-dollar homes
    A closer look at Compass’ trail of litigation over its business tactics
    A closer look at Compass’ trail of litigation over its business tactics
    A closer look at Compass’ trail of litigation over its business tactics
    Salesforce CEO Marc Benioff and Amazon's Jeff Bezos are backing the startup (Getty, Arrived)
    Bezos-backed Arrived Homes is latest startup to expand real estate investment
    Bezos-backed Arrived Homes is latest startup to expand real estate investment
    arrow_forward_ios

    The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

    Loading...