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Baron Real Estate Fund

Symbol BREFXCUSIP: 06828M702
Symbol BREFXCUSIP: 06828M702
SCT
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$39.42

Daily Change -$0.12 (-0.30%)
As of 10/08/2024

Morningstar Rating™

As of 09/30/2024

Prices & Performance

PricesAs of 10/08/2024

NAVDaily Change ($)Daily Change (%)MTDQTDYTD
$39.42-$0.12-0.30%-1.74%-1.74%13.70%
NAV$39.42
Daily Change ($)-$0.12
Daily Change (%)-0.30%
MTD-1.74%
QTD-1.74%
YTD13.70%

PerformanceAs of 09/30/2024

Portfolio or IndexQTD1YTD11 Year3 Years5 Years10 YearsSince Inception 12/31/2009
BREFX - Baron Real Estate Fund17.83%15.72%36.93%3.84%15.31%10.68%13.87%
MSCI USA IMI Extended Real Estate Index15.61%18.25%38.24%8.00%10.18%10.19%11.74%
MSCI US REIT Index15.79%14.82%32.74%3.73%4.24%6.46%8.65%
S&P 500 Index5.89%22.08%36.35%11.91%15.98%13.38%13.95%

Performance InformationAs of 06/30/2024

Performance statistics3 Years5 Years10 Years
Standard Deviation (%)23.3423.1219.87
Sharpe Ratio-0.230.450.36
Alpha (%)-4.934.670.33
Beta1.020.961.00
R-Squared (%)94.4186.9885.68
Tracking Error (%)5.548.407.52
Information Ratio-0.940.530.02
Upside Capture (%)92.62106.37103.33
Downside Capture (%)108.5492.97103.95
Except for Standard Deviation and Sharpe Ratio, the performance based-characteristics above were calculated relative to the Baron Real Estate Fund's(BREFX) benchmark (MSCI USA IMI Extended Real Estate Index). Performance statistics for additional periods will be provided on request. Source FactSet: SPAR.

Risk & Return106/30/2019 - 06/30/2024

1 Source: FactSet SPAR.

Portfolio Holdings & Characteristics

HoldingsAs of 09/30/2024

HoldingSector% of Net Assets
Equinix, Inc.
Equinix, Inc. (EQIX) is a network neutral operator of 260 data centers across 70 metro areas and 33 countries in North America, Europe, and Asia-Pacific. It provides highly reliable facilities and offers low latency interconnection to and among business partners, networks, and cloud service providers.
Equinix benefits from several long-term secular trends, including increasing internet traffic, IT outsourcing, cloud computing, AI, and mobility. As data and customer needs become more global, Equinix should also be able to leverage its leading global data center platform. We believe Equinix can continue to grow through new data center development, rent increases, and the addition of value-added services supplemented by accretive acquisitions that increase market penetration and reach.
Real Estate6.4%
Toll Brothers, Inc.
Toll Brothers, Inc. (TOL) is a leading high-end, luxury homebuilder that caters to move-up, empty-nester, active-adult, age-qualified, and second-home buyers in 19 states in the U.S.
New single-family home construction activity in the U.S. remains below the levels needed to meet current and pent-up demand following a decade of underbuilding. We expect single-family home construction activity to continue over the medium term. In our view, Toll Brothers is a differentiated homebuilder with a niche focus on high-end homes and an excellent management team. We think Toll Brothers is well positioned to benefit from housing growth through its sizable land bank, healthy balance sheet, and market share gains against smaller players.
Consumer Discretionary6.1%
Lennar Corporation
Lennar Corporation (LEN) is one of the nation's largest homebuilders.
New single-family home construction activity in the U.S. remains below the levels needed to meet current and pent-up demand following a decade of under-building. We expect single-family home construction activity to continue over the next several years. As one of the largest U.S. homebuilders, Lennar is well positioned to benefit from end-market growth and market share gains. The company is also driving improved returns on capital via margin expansion and improved capital efficiency.
Consumer Discretionary5.9%
D.R. Horton, Inc.
D.R. Horton, Inc. (DHI) is the largest homebuilder in the U.S.
New single-family home construction activity in the U.S. remains below the levels needed to meet current and pent-up demand following a decade of underbuilding. We expect single-family home construction activity to continue over the medium term. D.R. Horton is well positioned to benefit from end-market growth and market share gains. The company is also driving higher returns on capital via margin expansion and improved capital efficiency.
Consumer Discretionary5.6%
Blackstone Inc.
Blackstone Inc. (BX) is the world’s largest alternative asset manager. It has $1 trillion in assets under management, with specialization across Private Equity, Real Estate, Hedge Fund Solutions, and Credit & Insurance.
Blackstone is a best-of-breed global alternative asset manager, with a strong brand, global scale, long-term investment track record, full suite of products, and a proven executive team. The company is still in the early innings of democratizing access to alternative investments for a broader array of investors. Blackstone is asset-light, maintains minimal corporate level debt, and returns most of its cash flow through dividends and share repurchases.
Financials4.4%
CBRE Group, Inc.
CBRE Group, Inc. (CBRE) is a leading commercial real estate services company with the leading market share in all of its major businesses.
We believe CBRE will gain meaningfully from the long-term recovery in the commercial real estate industry. Its leasing and investment sales units have high incremental margins, and we believe its profitability will improve with healthier end markets. We also believe the market under-appreciates the value associated with CBRE’s property management unit given its growing, highly recurring revenue stream and open-ended growth prospects. CBRE is also one of the world’s leading managers of real estate assets.
Real Estate4.1%
Jones Lang LaSalle Incorporated
Jones Lang LaSalle, Inc. (JLL) is one of the world's largest providers of commercial real estate transaction, consulting, and investment management services through a network of more than 100 offices worldwide.
Jones Lang has a leading brand, sophisticated technology, global platform, deep bench of talent, and a solid balance sheet. Its scale and platform provide a strong moat. We think the company will benefit from stabilization in interest rates and the economy, which should lead to improvement across business lines, in particular leasing and capital markets. We think the company can grow EPS at a double-digit CAGR over the next several years, driven by a cyclical recovery, secular growth tailwinds, market share gains, operating leverage, acquisitions, and share buybacks.
Real Estate3.9%
GDS Holdings Limited
GDS Holdings Limited (GDS) is a market-leading China-based operator of data centers with over 50 data centers, five Tier 1 markets, and approximately 450,000 square meters in service. More than 50% of its revenue comes from top Chinese internet companies.
We believe that, as the preferred provider to Alibaba and Tencent, as well as many other large emerging technology companies, GDS is poised to benefit from the explosive growth in cloud computing in China. Cloud adoption is still in the early stages in China, and GDS is capturing more than its fair share of incremental deployments due to its proven track record and carrier-neutral value proposition.
Information Technology3.8%
Welltower Inc.
Welltower Inc. (WELL) is a $45 billion diversified health care owner and manager of senior housing, including assisted and independent living. Core to its strategy is to partner with top-tier operators and health systems while providing operators access to its proprietary data analytics platform.
We are optimistic about the prospects for Welltower given the substantial opportunity for cyclical recovery and continued secular growth in its senior housing business through occupancy and rent growth. The company also benefits from its proven ability to recycle capital at attractive rates of returns, premier health care platform, partnerships with top-tier operators, and well-respected management team focused solely on creating value on a per-share basis.
Real Estate3.7%
Brookfield Corporation
Brookfield Corporation (BN) is one of the world's largest alternative asset managers, with >$800 billion in AUM and >$400 billion of fee-generating AUM. It owns stakes in several publicly listed affiliates as well as other unlisted investments. 
Brookfield Corporation's stake in listed companies, including Brookfield Infrastructure, Business Partners, Renewable Partners, and recently spun off Brookfield Asset Management, is worth $35/share, similar to Brookfield Corporation's current share price. We believe it has another $24/share worth of unlisted investments and $8/share value of carried interest generated that is not reflected in the price. We also believe shares of Brookfield Asset Management will increase now that it is a public mark, which should accrue to Brookfield Corporation's market value.
Financials3.6%
Total
Total
47.6%
Top Ten Fund Holdings based on net assets. Portfolio holdings may change over time.
Portfolio holdings are subject to change. Current and future portfolio holdings are subject to risk.

Contributors / DetractorsQuarterly as of 06/30/2024

Top ContributorsAverage WeightContribution
Equity Residential3.30%0.40%
Welltower Inc.3.17%0.38%
Digital Realty Trust, Inc.3.20%0.25%
AvalonBay Communities, Inc.1.62%0.20%
Jones Lang LaSalle Incorporated2.60%0.16%
Source: FactSet PA.

GICS Sector BreakdownAs of 09/30/2024

Sector

Real Estate

37.9%

Consumer Discretionary

36.9%

Financials

10.1%

Materials

5.5%

Industrials

4.7%

Information Technology

3.8%

Cash & Cash Equivalents

1.0%

Sub-Industry

09/30/2024
Homebuilding18.90%
Asset Management & Custody Banks10.10%
Real Estate Services 10.10%
Data Center REITs 9.90%
Casinos & Gaming8.80%
Hotels, Resorts & Cruise Lines5.20%
Home Improvement Retail3.90%
Internet Services & Infrastructure3.80%
Industrial REITs 3.70%
Health Care REITs 3.70%
Multi-Family Residential REITs 3.30%
Construction Materials3.00%
Office REITs 2.70%
Trading Companies & Distributors2.60%
Forest Products2.50%
048121620
Homebuilding18.90%
Asset Management & Custody Banks10.10%
Real Estate Services 10.10%
Data Center REITs 9.90%
Casinos & Gaming8.80%
Hotels, Resorts & Cruise Lines5.20%
Home Improvement Retail3.90%
Internet Services & Infrastructure3.80%
Industrial REITs 3.70%
Health Care REITs 3.70%
Multi-Family Residential REITs 3.30%
Construction Materials3.00%
Office REITs 2.70%
Trading Companies & Distributors2.60%
Forest Products2.50%
048121620

Distributions

Record DateEx DatePayable DateIncomeReturn of CapitalShort-Term Capital GainLong-Term Capital GainTotalRe-Invest NAVCalendar-Year Return
09/23/202409/24/202409/25/2024$0.0585$0.0000$0.0000$0.0000$0.0585$40.03
12/06/202312/07/202312/08/2023$0.0196$0.0000$0.0000$0.0000$0.0196$31.9424.70%
12/07/202212/08/202212/09/2022$0.0221$0.0000$0.0000$0.0000$0.0221$28.84-28.61%
09/26/202209/27/202209/28/2022$0.0000$0.0000$0.5012$0.2963$0.7975$26.32-28.61%
11/22/202111/23/202111/24/2021$0.0000$0.0000$0.0000$2.2591$2.2591$38.6724.03%
For estimated distributions, visit the Tax Center
Jeff Kolitch, Vice President and Portfolio Manager
Investor Series

Baron Real Estate Fund: The Case for Real Estate – Opportunities Abound

Learn more about the investment approach for Baron Real Estate Fund.