REET Offers Greater Scale Than GQRE
Key Points
GQRE charges a notably higher expense ratio but sports a higher dividend yield than REET.
Both funds delivered nearly identical 1-year returns, yet GQRE saw a deeper five-year drawdown and holds fewer positions.
REET offers significantly more assets under management than GQRE.
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The iShares Global REIT ETF (NYSEMKT:REET) and FlexShares Global Quality Real Estate Index Fund (NYSEMKT:GQRE) both target global real estate exposure, but differ sharply on cost, yield, and size.
Both REET and GQRE aim for broad global real estate diversification, yet their approaches and investor experiences can diverge. This comparison weighs their cost, performance, liquidity, risk, and portfolio specifics to help investors decide which may better suit different priorities in the real estate ETF landscape.
Snapshot (cost & size)
| Metric | REET | GQRE |
|---|---|---|
| Issuer | IShares | FlexShares |
| Expense ratio | 0.14% | 0.45% |
| 1-yr return (as of 2026-03-16) | 12.30% | 12.97% |
| Dividend yield | 3.5% | 4.5% |
| Beta | 1.07 | 1.01 |
| AUM | $4.6 billion | $357.0 million |
Beta measures price volatility relative to the S&P 500; beta is calculated from five-year monthly returns. The 1-yr return represents total return over the trailing 12 months.
GQRE charges more than triple REET’s annual fee, which could matter for long-term cost-conscious investors, but it also offers a higher dividend yield that may appeal to those seeking income.
Performance & risk comparison
| Metric | REET | GQRE |
|---|---|---|
| Max drawdown (5 y) | -32.06% | -35.07% |
| Growth of $1,000 over 5 years | $1,188 | $1,202 |
What's inside
FlexShares Global Quality Real Estate Index Fund holds about 174 securities with a 12.4-year history, focusing exclusively on real estate companies. Its largest positions include American Tower (NYSE:AMT), Prologis (NYSE:PLD), and Welltower (NYSE:WELL), with no significant tilts toward other sectors. The fund’s portfolio design emphasizes global diversification and tracks the Northern Trust Global Quality Real Estate Index, without employing additional screens or quirks.
In contrast, iShares Global REIT ETF holds a broader basket of 325 global real estate stocks, concentrating its top holdings in Welltower, Prologis, and Equinix (NASDAQ:EQIX). REET’s much larger assets under management and pure real estate sector focus offer greater scale and liquidity, but its top holdings overlap with GQRE’s, leading to similar sector exposures.
For more guidance on ETF investing, check out the full guide at this link.
What this means for investors
Both funds are solid choices for investors looking for real estate exposure in 2026. This could be a favorable time to consider these funds, as interest rates have stabilized after rising in recent years. The Federal Reserve’s recent pivot to cutting rates could signal a recovery on the horizon for the sector.
REET’s advantage is its scale and diversification. It has more holdings and billions in assets. Investors who care about liquidity may want to consider REET over GQRE.
GQRE is smaller with just 174 holdings and $357 million in net assets. However, investors who need income will prefer it over REET. GQRE’s higher expense ratio is more than compensated by its dividend yield, which is one percentage point higher than REET.
Over the past 10 years, both real estate ETFs have delivered returns that are almost identical. But GQRE’s return came with slightly more volatility than REET, as noted by its steeper five-year max drawdown of 35% — slightly higher than REET’s 32% max drawdown.
Overall, both are solid choices for the long term. The key differences are asset size and yield, which will depend on each investor’s needs.
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John Ballard has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends American Tower, Equinix, and Prologis. The Motley Fool has a disclosure policy.
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