REIT investors are mainly after the current yield that comes from renting existing properties. They also want companies that can generate rent growth from well-located properties and from inflation, as well as management teams with the ability to maintain properties efficiently, develop new properties and occasionally sell existing ones at attractive prices.

The largest ETF dedicated to the property REIT sector is the aforementioned Vanguard REIT Index Fund. At more than $30 billion, it is the behemoth in the category. It tracks the MSCI US REIT Index, a capitalization-weighted index composed of 151 constituents representing 99% of the U.S. equity REIT universe. Its largest holding is the mall landlord Simon Property Group (SPG). Other large constituents are Equinix (EQIX), owner of large data centers; Prologis (PLD), an industrial landlord; Public Storage (PSA), a self-storage company; and AvalonBay Communities (AVB), a residential, multifamily landlord.

The problem with VNQ is that it’s getting too big, and it recently asked shareholders to allow it to track a different index that holds both REITs and real estate operating companies (REOCs). That’s because REIT rules demand that no mutual fund or ETF own more than 10% of a REIT.

Neither VNQ nor Vanguard’s other real estate funds have violated that rule yet, but putting all the firm’s funds together shows that Vanguard owns more than 13% of the roughly $1 trillion property REIT sector.

If VNQ begins to hold REOCs, its dividend yield will almost certainly decrease. That’s because REOCs are mostly land companies, not unlike home builders. REOCs like Tejon Ranch may own some developed property on which they collect rent, but they also typically own vast swaths of undeveloped land that generates no revenue or income. REOCs potentially produce good returns when development occurs, and some actively managed mutual funds pepper their portfolio with them. But the development typically has no set schedule and can be a difficult process, often making REOCs less attractive for real estate investors in the public markets.

The second-largest REIT ETF, with nearly $5 billion in assets, is the iShares U.S. Real Estate ETF (IYR). This product isn’t a straight property fund, though, because nearly 5% of it is in mortgage REITs. It tracks the Dow Jones U.S. Select Real Estate Index; REOCs and real estate services companies occupy around 7% of the fund’s portfolio. This fund comes with a twist in that its underlying index contains some property REITs not found in other indexes. Specifically, its top holding is cell tower company American Tower instead of Simon Properties, which is more commonly found as the top-holding in a property REIT fund. The third-largest holding is another cell tower landlord, Crown Castle International REIT. Altogether, more than 10% of this fund’s portfolio is in cell tower real estate.

Straightforward Property REIT ETFs

Given the size of the Vanguard ETF and the unusual qualities of the iShares U.S. Real Estate ETF, investors might want to consider other ETFs for basic property exposure. One example is the Schwab U.S. REIT ETF (SCHH), which tracks the Dow Jones U.S. Select REIT Index. This fund clocks in with a 0.07% expense ratio and provides straightforward exposure to property REITs—including the largest ones that are part of the S&P 500 as well as much smaller ones.

The iShares Cohen & Steers REIT ETF (ICF) and its sibling, the iShares Core U.S. REIT ETF (USRT), also provide straightforward property REIT exposure. The former has an expense ratio of 0.34% while the latter has a much lower expense ratio of 0.08%. Over the past decade, the core fund has outperformed as a result of its lower expenses, posting a 6.76% annualized return versus 6.39% for the ICF fund. It’s unclear why the iShares Cohen & Steers fund has a higher expense ratio since it concentrates on larger-cap stocks—or why investors should own it. USRT shareholders get the benefit of exposure to some smaller stocks with a lower expense ratio.

The SPDR Dow Jones REIT ETF (RWR) also tracks the Dow Jones U.S. Select REIT Index. But its 0.25% expense ratio makes it less attractive to investors than the SCHH fund from Schwab, whose ratio is 0.07%.