Baron Capital, an investment management company, released its Q4 2025 letter for its “Baron Real Estate Income Fund”. A copy of the letter can be downloaded here. In 2025, the Fund appreciated 3.74% (Institutional Shares), exceeding the 1.68% gain for the MSCI US REIT Index (the REIT Index). In Q4 2025, the Fund declined modestly by 0.40%, outperforming the Index’s 1.99% decline. In contrast to the substantial double-digit growth delivered in 2023 and 2024, the Fund’s modest performance in 2025 can be attributed to a variety of factors, such as stronger relative growth in several sectors outside of real estate, ongoing interest rate headwinds, and specific REIT subcategory headwinds. As of December 31, 2025, the Fund’s net assets are as follows: REITs (71.2%), non-REIT real estate companies (25.0%), and cash and cash equivalents (3.8%). Also, the Fund currently has investments in 13 REIT categories. Heading into 2026, the Firm is optimistic about the prospects for the stock market and the Baron Real Estate Income Fund. Please review the Fund’s top five holdings to gain insights into their key selections for 2025.
In its fourth-quarter 2025 investor letter, Baron Real Estate Income Fund highlighted stocks like Host Hotels & Resorts, Inc. (NASDAQ:HST). Host Hotels & Resorts, Inc. (NASDAQ:HST) is a leading lodging real estate investment trust. On April 2, 2026, Host Hotels & Resorts, Inc. (NASDAQ:HST) closed at $19.14 per share. One-month return of Host Hotels & Resorts, Inc. (NASDAQ:HST) was -0.47%, and its shares gained 45.66% over the past 52 weeks. Host Hotels & Resorts, Inc. (NASDAQ:HST) has a market capitalization of $13.16 billion.
Baron Real Estate Income Fund stated the following regarding Host Hotels & Resorts, Inc. (NASDAQ:HST) in its fourth quarter 2025 investor letter:
“The Fund has maintained a position in Host Hotels & Resorts, Inc. (NASDAQ:HST), the world’s largest lodging REIT. We have a favorable view of the company because it owns and operates a large portfolio of premier hotels in attractive geographic markets that should generate strong growth over time. Management maintains a strong and liquid investment grade balance sheet. We view the company’s current valuation as compelling.”
Host Hotels & Resorts, Inc. (NASDAQ:HST) is not on our list of 40 Most Popular Stocks Among Hedge Funds Heading Into 2026. According to our database, 38 hedge fund portfolios held Host Hotels & Resorts, Inc. (NASDAQ:HST) at the end of the fourth quarter, up from 31 in the previous quarter. While we acknowledge the risk and potential of Host Hotels & Resorts, Inc. (NASDAQ:HST) as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than Host Hotels & Resorts, Inc. (NASDAQ:HST) and that has 10,000% upside potential, check out our report about this cheapest AI stock.
In another article, we covered Host Hotels & Resorts, Inc. (NASDAQ:HST) and shared a list of cheap REITs with huge upside. In addition, please check out our hedge fund investor letters Q4 2025 page for more investor letters from hedge funds and other leading investors.
READ NEXT: 33 Stocks That Should Double in 3 Years and 15 Stocks That Will Make You Rich in 10 Years.
Disclosure: None. This article is originally published at Insider Monkey.
