Why investors are rushing into real estate ETFs

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

National /
Jun.June 09, 2021 11:27 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
    Hartz Mountain Industries CEO Leonard Stern and 235 Pinelawn Road (Google Maps, Hartz Mountain)
    Warehouse developer accused of violating “Long Island First” policy
    Warehouse developer accused of violating “Long Island First” policy
    Greenwich rentals, like at The Mill (pictured), are in high demand (iStock, The Mill)
    In Greenwich, luxury rentals might be hotter than sales
    In Greenwich, luxury rentals might be hotter than sales
    The $69 million estate (Lena Yaremenko)
    East Hampton estate hits market for first time in 75 years, asks $69M
    East Hampton estate hits market for first time in 75 years, asks $69M
    1210 Meadow Lane with the late Luba Marks. (Zillow / Out East)
    Luba Marks’ Southampton home sells at $8M discount
    Luba Marks’ Southampton home sells at $8M discount
    Amazon signs lease with Lincoln Equities for 360K-sf warehouse in Rutherford
    Amazon signs lease with Lincoln Equities for 360K-sf warehouse in Rutherford
    Amazon signs lease with Lincoln Equities for 360K-sf warehouse in Rutherford
    A rendering of 12 Eileen’s Path, East Hampton (Corcoran)
    Think buying in the Hamptons is tough? Try building
    Think buying in the Hamptons is tough? Try building
    Charlie Kushner, Laurent Morali, Nicole Kushner with Monmouth Mall (Google Maps, Sasha Maslov, Getty)
    Kushners fend off rival developers for NJ mall
    Kushners fend off rival developers for NJ mall
    North Fork home inventory can’t meet demand
    North Fork home inventory can’t meet demand
    North Fork home inventory can’t meet demand
    arrow_forward_ios

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

    Loading...