Baron Real Estate Income Fund

Prologis, Inc. (PLD) is the world's largest industrial REIT, with a $100 billion global portfolio. 
In our view, industrial real estate has attractive fundamentals over the next several years, with organic growth among the highest across all real estate asset types. Stabilizing demand—driven by the growth of e-commerce, inventory building, and the need for infill locations to service last-mile delivery—should help absorb a sharp decline in new supply deliveries. We believe Prologis is well positioned to benefit from this favorable fundamental backdrop, supported by its strong assets, markets, management, and balance sheet.

Welltower Inc. (WELL) is a $70 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.

Equinix, Inc. (EQIX) is a network-neutral operator of more than 270 data centers in 70-plus metro areas across over 30 countries in North America, Europe, and Asia-Pacific. It offers highly reliable facilities and low-latency interconnection among enterprises, 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 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.

Ventas, Inc. (VTR) is a REIT with a $35 billion-plus portfolio of about1,400 properties across senior housing, medical office, hospitals, and life sciences properties.
We believe Ventas' well-located portfolio is poised to benefit from strong organic growth. In particular, Ventas' senior housing properties are cyclically depressed due to idiosyncratic reasons stemming from the pandemic, in our view. We see evidence that occupancy has bottomed and is primed to rebound substantially, as senior housing is a needs-based product with strong demographic forces around the forthcoming "silver wave" demand. Construction activity in the sector remains subdued and should position the company for favorable growth.

Brookfield Corporation (BN) is one of the world's largest alternative asset managers, with $1 trillion in assets under management (AUM) and more than $500 billion in 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 $33 per share. We see another $16 per share in unlisted investments and $8 per share in carried interest generated for a total of $50 per share, based solely on current, in-place earnings. We think the company will profit from growth in alternative asset management, given its superior track record, highly respected CEO, global reach, scale, and diverse product offerings.

EastGroup Properties, Inc. (EGP) is an industrial REIT that owns and operates approximately 65 million square feet of business distribution properties located in high-growth U.S. markets, with a primary focus on Texas, Florida, California, Arizona, and North Carolina.
In our view, industrial real estate has an attractive fundamental outlook over the next several years, with organic growth that is at the high end of real estate broadly. An eventual reacceleration in demand—driven by improving business confidence, the growth of e-commerce, inventory building, and the need for infill locations to service last-mile delivery—is poised to occur at a time when new supply has fallen sharply. We believe EastGroup is well positioned to benefit from this expected growth, given its strong assets, markets, management, and balance sheet.

Weyerhaeuser Company (WY) is a timber REIT. It is one of the world's largest owners of timberlands with 10.5M acres in the U.S. and 14M acres that are licensed in Canada. It also operates 19 lumber mills and 6 OSB mills, where it manufactures wood products such as lumber, plywood and other building materials.
Weyerhaeuser is trading at a significant discount to its NAV, which is the result of recent headwinds in new housing construction and R&R activity related to elevated interest rates. Historically, WY has performed well off of cyclically low valuations near today's levels. Additionally, ~10% of lumber industry capacity was recently curtailed, which has already started to spur a rally in lumber prices that should continue as demand recovers as well. The timber REITs will be key beneficiaries of higher lumber prices and tend to perform well in a rising lumber price environment.

The Macerich Company (MAC) is a REIT that owns a high-quality portfolio of mall properties, primarily in California, New York, and Arizona.
Macerich should benefit from favorable real estate fundamentals for high-quality, well-located retail properties, with tenant demand exceeding available space and generating rent growth. The recent appointment of a new CEO to lead Macerich through a multi-year business transformation should also help simplify the company’s portfolio, reduce debt, and improve growth prospects. We believe the stock is undervalued and a successful conversion will result in a higher valuation multiple over time.

Jones Lang LaSalle Incorporated (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. In our view, Jones Lang will benefit from eventual stabilization in interest rates and the economy, which should lead to improvement across business lines, particularly in leasing and capital markets. We think the company can grow EPS at a double-digit CAGR over the next few years, driven by a cyclical recovery, secular tailwinds, market share gains, operating leverage, acquisitions, and share buybacks.

Simon Property Group, Inc. (SPG) is the largest U.S. mall and outlet REIT, with a portfolio consisting of malls (50%), outlets (40%), and international operations (10%).
Simon's size and balance sheet strength should help it remain a dominant force in the U.S. mall business, where scale matters, and in the outlet business, where it holds roughly 50% market share. Simon has unparalleled access to a variety of capital sources and a distinct cost-of-capital advantage in raising debt and equity. In our opinion, the executive team, led by David Simon, is deep and talented. Simon continues to invest domestically and abroad. We believe the stock price is attractive, trading at a discounted valuation multiple.