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dvisors and income investors often favor passive approaches to REITs, yet active management can deliver long‑term benefits. The ALPS Active REIT ETF (REIT) is a five‑year‑old actively managed fund that deserves attention now that real‑estate balance sheets are solid and FFO metrics are improving.

    With a 3.12% dividend yield, REIT offers the flexibility of active management, giving investors insight into which real‑estate sectors are attracting professional capital. Its sector allocation is compelling: healthcare REITs hold 19.48% of the portfolio, the second‑largest weight. Telecommunication exposure is 135% of its index weight, making it the most overweight sector. Office space has shifted from underweight to overweight for the first time since early 2020, and lodging/resorts are close to index parity.

    The largest subgroup is specialized REITs, a diverse segment that includes data‑center landlords—several of which rank among REIT’s top ten holdings, indicating a foothold in the AI market. Nareit data show active managers are also increasing exposure to lodging and retail landlords, both represented in REIT. Retail REITs account for 14% of the fund, while lodging/resorts now hold 99% of their index weight. Retail and industrial sectors remain underweight at 76% and 80% of their index shares, respectively.

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