Baron
Baron Real Estate Strategy
US Large-cap Real Estate
Dec 2024 → Sep 2026
Our archive holds 9 letters from this strategy, behind 38 investment theses and positions in 38 companies. Every quote below is copied verbatim from the letter it came from.
9 letters in 3 years · follow all of Baron for every strategy.
Performance
as of Sep 30, 2026 · net of fees · USD
- YTD−7.9%index −2.6%
- 1Y−9.1%index −6.0%
- 3Y · /yr+8.9%index +10.4%
- 5Y · /yr+1.2%index +4.2%
- 10Y · /yr+10.0%index +7.8%
- Inception · /yr+12.4%index +10.4%
Index: MSCI USA IMI Extended Real Estate Index
| YTD | 1Y | 3Yper year | 5Yper year | 10Yper year | Since inceptionper year | |
|---|---|---|---|---|---|---|
| Baron Real Estate Strategy | −7.9% | −9.1% | +8.9% | +1.2% | +10.0% | +12.4% |
| MSCI USA IMI Extended Real Estate Index | −2.6% | −6.0% | +10.4% | +4.2% | +7.8% | +10.4% |
Calendar years
- 2025+5.2%index +4.9%
- 2024+12.5%index +12.7%
- 2023+25.1%index +23.1%
- 2022−28.4%index −23.8%
- 2021+24.5%index +36.5%
Since inception: Since Inception (1/31/2010)4
Disclaimer
These figures are copied from the manager’s latest letter, as of Sep 30, 2026. They were extracted automatically, have not been verified by HF Best Ideas and may contain errors. They cover a single share class, in the currency and fee basis stated above; other share classes and your own returns will differ. This is not investment advice, nor an offer to buy or sell any fund. Past performance does not predict future returns.
Read full disclosures →What it bought and sold
In the most recent quarter, we exited the Fund’s investments in Fortune Brands Innovations, Inc., a leading provider of plumbing, outdoor, and security products for the residential construction and remodel sectors, and Boyd Gaming Corporation, a casino gaming company, and reallocated the capital to other real estate companies that we believe offer superior total return prospects in the next few years.
Following strong year-to-date share price performance, we modestly trimmed the Strategy’s position in Equinix, Inc., a leading global operator of data centers, but remain bullish about the company’s long-term business prospects.
- New positionLegence Corp.Sep 2026
We began acquiring shares of Legence Corp. during the quarter.
In the most recent quarter, we exited the Strategy’s investments in Fortune Brands Innovations, Inc., a leading provider of plumbing, outdoor, and security products for the residential construction and remodel sectors, and Boyd Gaming Corporation, a casino gaming company, and reallocated the capital to other real estate companies that we believe offer superior total return prospects in the next few years.
During the quarter, we initiated a position in Armstrong World Industries, Inc. following a roughly 25% decline in the share price over the preceding months.
We added to the Fund's AAON, Inc. position following a disappointing second quarter earnings result.
Following a 40% increase in the shares of Equinix, Inc. , a leading global operator of data centers, we trimmed the Strategy's large position in the company but remain bullish about the company’s long-term business prospects.
we trimmed our position and reallocated capital to companies where we have a higher degree of visibility and lower exogenous risks such as the current geopolitical environment.
Following the announcement of Berkshire Hathaway’s agreement to acquire Taylor Morrison Home Corporation , a leading national homebuilder, we exited the Strategy's investment in the company.
- New positionBlackstone Digital Infrastructure Trust Inc.Jun 2026
We participated in the IPO of Blackstone Digital Infrastructure Trust Inc. , a newly listed Blackstone-sponsored vehicle focused on acquiring stabilized, fully leased data centers underpinned by long-term non-cancellable leases to the world’s largest hyperscalers in primary data center markets.
During the quarter, we initiated a position in Meritage Homes Corporation , the fifth-largest homebuilder in the U.S., with operations across the West, Central, and East regions.
We recently trimmed the Fund’s investment in Wynn Resorts, Limited , a global luxury owner and operator of integrated resorts (hotels and casino resorts), in part due to the delay in the opening of its new UAE resort.
Given severe multiple compression across the sector with all alternative managers being painted with a broad brush and extreme investor negativity, we took advantage of the volatility to reinitiate a position in the company at what we deemed to be highly compelling valuation levels.
Top net sales for the quarter Quarter End Market Cap or Market Cap When Sold ($B) Net Amount Sold ($M) Wynn Resorts, Limited 10.1 51.6 Equinix, Inc. 102.8 42.7 Taylor Morrison Home Corporation 6.7 38.7 Ventas, Inc. 43.2 35.4 Prologis, Inc. 129.5 34.9
We recently began acquiring shares in Procore Technologies, Inc. , a provider of software solutions to the construction industry, and will elaborate on this company in future investor letters.
Also held
- Airbnb, Inc.
- Toll Brothers, Inc.
- Brookfield Corporation
- Blackstone Inc.
- Jones Lang LaSalle Incorporated
- PENN Entertainment, Inc.
- Welltower Inc.
- The Macerich Company
- CBRE Group, Inc.
- Prologis, Inc.
- Meritage Homes Corporation
- Procore Technologies, Inc.
- Mohawk Industries, Inc.
- GDS Holdings Limited
- Hilton Worldwide Holdings Inc.
- Cushman & Wakefield Ltd.
- Brookfield Asset Management Ltd.
- PulteGroup, Inc.
- SiteOne Landscape Supply, Inc.
- The Home Depot, Inc.
- Caesars Entertainment, Inc.
- Lowe's Companies, Inc.
- Hyatt Hotels Corporation
- AAON, Inc.
Its investment theses
- Airbnb, Inc.Sep 2026Airbnb operates a global travel marketplace and is seen as entering a durable multi-year growth re-acceleration driven by pricing tools, boutique hotels, and loyalty.
- Mohawk Industries, Inc.Sep 2026Mohawk Industries is the largest flooring manufacturer and is backed by a new CEO, improving execution, and a low relative valuation.
- Procore Technologies, Inc.Sep 2026Procore provides cloud construction management software and is viewed as taking share with durable growth, margin improvement, and stickier customers.
- PENN Entertainment, Inc.Sep 2026PENN Entertainment operates regional casinos and online gaming, with improving cash flow, a narrower Interactive loss, and deleveraging potential.
- Toll Brothers, Inc.Sep 2026Toll Brothers is a luxury homebuilder with a strong customer base, limited competition, a valuable land portfolio, and attractive valuation.
- Legence Corp.Sep 2026Legence provides mission-critical building systems services and is attractive due to design-build scale, labor advantages, data center exposure, and valuation.
- Armstrong World Industries, Inc.Sep 2026Armstrong World Industries is a competitively advantaged architectural solutions leader with durable cash flow growth, new leadership, and a discounted valuation.
- Brookfield CorporationSep 2026Brookfield Corporation is viewed as a long-term alternative asset manager with scale, a strong track record, and a compelling valuation.
- Blackstone Inc.Sep 2026Blackstone is positioned to benefit from secular growth in alternatives and trades near the low end of its five-year valuation range.
- Jones Lang LaSalle IncorporatedSep 2026Jones Lang LaSalle is a commercial real estate services firm trading at just 11 times 2027 estimated earnings versus a high-teens multiple justified by its improving business mix.