Alternative Investments/ESG: BlackRock Debuts An Environmentally Focused REIT ETF
This is the first such ETF in the US.
iShares, the ETF unit of BlackRock (NYSE: BLK), launched last week the iShares Environmentally Aware Real Estate ETF (NASDAQ: ERET). The ETF will invest in REIT and real estate holding and development companies that have a sustainability focus and are environment-friendly – specifically, companies with an increased exposure to green certification and energy efficiency. According to the Fund, buildings are the source of 37% of global carbon emissions. (Yahoo Finance)
The fund is the first US-listed ETF to offer sustainability-focused exposure to real estate assets.
iShares Environmentally Aware Real Estate ETF (ERET)
The new ERET ETF will track the FTSE EPRA Nareit Developed Green Target Index and has an expense ratio of 0.30%. The securities in this (Underlying) Index are selected from the FTSE EPRA Nareit Developed Index – the Parent Index – which is composed of real estate investment trusts and real estate holding and development companies from developed market countries or regions.
As of October 31, 2022, the Underlying Index was composed of 377 securities of companies in the following countries or regions: Australia, Austria, Belgium, Canada, Finland, France, Germany, Hong Kong, Ireland, Israel, Italy, Japan, the Netherlands, New Zealand, Norway, Singapore, South Korea, Spain, Sweden, Switzerland, the United Kingdom, and the U.S.
As of October 31, 2022, a significant portion of the Underlying Index included companies offering various real estate services, real estate operating companies and REITs.
On launch date, the ERET ETF had invested in 366 companies, the top holdings of which include Prologis REIT Inc. (NYSE: PLD) at 6.3%; Equinix REIT Inc. (NASDAQ: EQIX) at 5.64%; and Digital Realty Trust REIT Inc. (NYSE: DLR) at 2.42%.
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