Regardless of what happens to their stock prices, REITs may be set to break out come September. Real Estate will be elevated to a Level 1 Global Industry Classification Standard (GICS) sector in MSCI and S&P Dow Jones Indexes starting next month. That means equity REITs and other real estate companies will no longer be part of the financial sector in this first new sector elevation since the GICS was established in 1999. 'This change reflects the both the size and importance of listed real estate equities while underscoring that listed equity REITs are an important component of the Real Estate asset class,' said Wilson Magee, portfolio manager for the Franklin Real Estate Securities Fund (FREEX) - Get Franklin Real Estate Sec A Report . Magee adds that the move also validates 'the long-term acceptance of equity REITs by all investors' and the strong performance and risk characteristics likely to support increasing demand for real estate stocks as well as long-term capital formation and growth for US REITs. After the changes, index weightings for real estate will be similar to those of Utilities in S&P 500 and MSCI World. Financial sector weights will decline by about 20 percent, according to Magee, with financials in the S&P 500 declining from 15.7 percent to 12.5 percent.