Baron Funds, an investment management company, released its “Baron Real Estate Fund” second quarter 2024 investor letter. A copy of the letter can be downloaded here. The fund declined 9.20% (Institutional Shares) in the second quarter compared to a 0.22% decline for the MSCI US REIT Index (the REIT Index) and a 4.03% decline for the MSCI USA IMI Extended Real Estate Index (the MSCI Real Estate Index). Some of the Fund’s top performers from 2023 and the first quarter of 2024 experienced declines, partly due to concerns about slowing growth. This includes the shares of homebuilders, residential building product and services companies, casino and gaming operators, certain REITs, and other real estate-related companies. In addition, please check the fund’s top five holdings to know its best picks in 2024.
Baron Real Estate Fund highlighted stocks like Equity Residential (NYSE:EQR), in the second quarter 2024 investor letter. Equity Residential (NYSE:EQR) is a real estate investment trust focused on the acquisition, development, and management of apartments. The one-month return of Equity Residential (NYSE:EQR) was 6.55%, and its shares gained 13.27% of their value over the last 52 weeks. On August 28, 2024, Equity Residential (NYSE:EQR) stock closed at $74.19 per share with a market capitalization of $28.993 billion.
Baron Real Estate Fund stated the following regarding Equity Residential (NYSE:EQR) in its Q2 2024 investor letter:
“In the second quarter, the shares of Equity Residential (NYSE:EQR), the largest U.S. multi-family REIT, appreciated due to continued strong operating updates, an improved full-year growth outlook, and faster-than-expected improvement in the company’s West Coast markets. Management has assembled an excellent portfolio of Class A apartment buildings located in high barrier-to-entry coastal markets with favorable long-term demographic trends and muted overall supply growth. Please see the “Top net purchases” for further thoughts on the company.
In the second quarter, we increased the Fund’s REIT exposure to best-in-class multi-family owners/operators Equity Residential and AvalonBay Communities, Inc. Our meetings with each management team supported our view that both companies are led by astute executives that are highly focused on driving value creation for shareholders…” (Click here to read the full text)
An exterior shot of a newly acquired apartment building, signifying the company’s acquisition of large residential properties.
Equity Residential (NYSE:EQR) is not on our list of 31 Most Popular Stocks Among Hedge Funds. As per our database, 30 hedge fund portfolios held Equity Residential (NYSE:EQR) at the end of the second quarter which was 36 in the previous quarter. While we acknowledge the potential of Equity Residential (NYSE:EQR) as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is as promising as NVIDIA but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
In another article, we discussed Equity Residential (NYSE:EQR) and shared the list of best residential real estate stocks to buy. Baron Real Estate Fund reestablished its position in Equity Residential (NYSE:EQR) in Q4 2023. In addition, please check out our hedge fund investor letters Q2 2024 page for more investor letters from hedge funds and other leading investors.
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Disclosure: None. This article is originally published at Insider Monkey.
