The ETF focuses on non-traditional real estate sectors, which include data centers, life sciences, single-family rental, medical office, and self-storage.

Principal Global Investors has launched today its first semi-transparent ETF focusing on the non-traditional property sectors of the publicly traded U.S. real estate market: The Principal Real Estate Active Opportunities ETF (NYSEARCA: BYRE) is an actively managed fund seeking total return. (BusinessWire)

Principal Real Estate Active Opportunities ETF

The new ETF will have a concentrated exposure to non-traditional property sectors, which have been highly resilient portfolio performers in recent years. This ETF is ideally included as a satellite allocation to a core equity portfolio with the following advantages:

• potential for better portfolio outcomes
• higher total returns with improved diversification
• supported by the resilient growth characteristics of many public REITs in the non-traditional sectors
• addressing structural themes ranging from demographics and infrastructure to globalization and technological innovation
• shifts in the economy
• being a semi-transparent ETF, it may face less risk that other traders can predict or copy its investment strategy. This may improve its performance.

Fundspeak

“The Principal Real Estate Active Opportunities ETF combines two core strengths of Principal – active management and real estate investing – to provide clients with an innovative strategy that seeks to improve portfolio outcomes. The fund is thematic and one of the first semi-transparent ETFs that gives investors exposure to in-demand real estate sectors with the benefits of a liquid ETF structure,” said Jill Brown, managing director of the U.S. Wealth Platform, Principal Global Investors.

“Non-traditional sectors now represent 64% of the public REIT market as they almost doubled their share of the market cap from 2010-2020. And compared to traditional real estate sectors, non-traditional REITs have offered higher returns and higher growth over the last 10 years,” said Todd Kellenberger, client portfolio manager for Principal Real Estate Investors. “This reinforces our conviction that our semi-transparent ETF that is focused on these niche property types can be a differentiated strategy for investors seeking resilient growth and potential inflation protection.”

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Image Credit: Geograph (Peter McDermott)