Third Avenue Management, an investment management company based in New York City, released its “Real Estate Value Fund” first quarter 2023 investor letter. A copy of the same can be downloaded here. In the quarter the fund returned +1.99% (net fees) compared to +1.04% (before fees) for the Fund’s most relevant benchmark, the FTSE EPRA NAREIT Developed Index. Holdings in US-based homebuilders, UK-centric real estate, and Industrial and Logistics REITs were the leading contributors of the fund in the quarter while, investments in certain Real Estate Operating Companies and the Preferred Equity of Fannie Mae and Freddie Mac were detracted. In addition, you can check the top 5 holdings of the fund to know its best picks in 2023.
Third Avenue Real Estate Value Fund highlighted stocks like CBRE Group, Inc. (NYSE:CBRE) in the first quarter 2023 investor letter. Headquartered in Dallas, Texas, CBRE Group, Inc. (NYSE:CBRE) is a commercial real estate service and investment company. On June 9, 2023, CBRE Group, Inc. (NYSE:CBRE) stock closed at $78.94 per share. One-month return of CBRE Group, Inc. (NYSE:CBRE) was 7.99%, and its shares gained 7.62% of their value over the last 52 weeks. CBRE Group, Inc. (NYSE:CBRE) has a market capitalization of $24.537 billion.
Third Avenue Real Estate Value Fund made the following comment about CBRE Group, Inc. (NYSE:CBRE) in its first quarter 2023 investor letter:
“With the addition of JLL, the Fund now has approximately 10% of its invested capital in Real Estate Services firms after also including CBRE Group, Inc. (NYSE:CBRE)and Savills plc. When viewed in the aggregate, these businesses nearly act as an oligopoly on services and transactions in key regions. They should also seem interesting for other “enterprising investors” with the three companies having “net cash” positions and common stocks trading at less than 10 times peak earnings, on average.
An additional 20% of the Fund’s capital is invested in Real Estate Services. As outlined above, these businesses are generally less capital-intensive than direct property ownership and consequently have offered much higher returns on capital over the course of a cycle—provided they have favorable positioning within the real estate value chain. At the present time, these holdings include franchises involved with investment management (Brookfield Corp. and Brookfield Asset Management), brokerage and property management (CBRE Group, Savills plc, and JLL), as well as mortgage and title insurance (FNF Group and the GSEs).”
STUDIO GRAND OUEST/Shutterstock.com
CBRE Group, Inc. (NYSE:CBRE) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 41 hedge fund portfolios held CBRE Group, Inc. (NYSE:CBRE) at the end of first quarter 2023 which was 38 in the previous quarter.
We discussed CBRE Group, Inc. (NYSE:CBRE) in another article and shared the list of best commercial real estate stocks to buy according to hedge funds. In addition, please check out our hedge fund investor letters Q1 2023 page for more investor letters from hedge funds and other leading investors.
Suggested Articles:
- 12 Cities Where Home Prices are Going Up Right Now
- 10 Biggest Gaming Companies in the World by Revenue
- 30 U.S. Cities with the Highest Murders in 2023
Disclosure: None. This article is originally published at Insider Monkey.
