BlackRock Launches Sustainability-Tilted Global Real Estate ETF

Mark Segal July 4, 2024

BlackRock announced the launch of the iShares Global Real Estate Environmental Tilt UCITS ETF, a new exchange traded fund investing in listed real estate equities globally, while adopting an ESG integration approach and tilting towards more environmentally sustainable issuers.

The new ETF will track the FTSE EPRA Nareit Developed Green Low Carbon Target Select UCITS Capped Index. According to FTSE Russell, the index aims to support investors seeking to integrate sustainable investment considerations into their listed real estate portfolios.

Based on an investment universe comprised of constituents of the FTSE EPRA Nareit Developed Index, the benchmark excludes issuers based on involvement in areas including oil sands, thermal coal, weapons, tobacco and controversies. Following the exclusion screening, remaining constituent weights are adjusted to achieve improved sustainability allocations, based on green building certification, reduction in energy usage, and a reduction in carbon intensity.

According to BlackRock, the new fund, categorized as Article 8 under the EU’s SFDR regulation, will achieve a weighted average environmental indicator at least 20% better than the investment universe through its ESG integration approach.

The launch of the new fund follows the rollout by BlackRock last month of a new suite of ETFs aimed at offering investors with exposure to companies leading in the transition to a low carbon economy.

Mark founded ESG Today following a 20 year career in investment management and research. Prior to founding ESG Today, Mark worked at Delaney Capital Management (DCM) in Toronto, Canada, most recently as the firm’s head of U.S. equities. While at DCM, Mark was part of the firm’s ESG team, responsible for evaluating and tracking the sustainability factors impacting portfolio companies, and assessing the suitability of companies for portfolio inclusion. Mark also spent several years in the sell-side research industry, covering the technology and services sectors. Mark holds an MBA from Columbia University in New York, a BBA from the Schulich School of Business at York University in Toronto, and is a CFA charterholder.