Baron Capital, an investment management company, released its Q4 2025 letter for its “Baron Real Estate Fund”. A copy of the letter is available to download here. Baron Real Estate Fund was recognized as the Best Real Estate Fund Over Three Years at the 2026 LSEG Lipper Funds Awards, reflecting the three-year performance ending December 31, 2025. The Fund declined 5.39% (Institutional Shares) in Q1, underperforming the MSCI USA IMI Extended Real Estate Index (−0.96%) and the MSCI US REIT Index (+4.52%). Despite the Q1 decline, the long-term performance remains strong. The letter covers current thoughts, portfolio composition, key themes, top contributors and detractors, recent activity, and outlook for real estate and the Fund. The Fund has a positive outlook on the broader equity market and public real estate, and maintains a constructive outlook with compelling reasons to stay the course. Please review the Fund’s top five holdings to gain insights into their key selections for 2026.
In its first-quarter 2026 investor letter, Baron Real Estate Fund Strategy highlighted Jones Lang LaSalle Incorporated (NYSE:JLL). Jones Lang LaSalle Incorporated (NYSE:JLL) is a leading commercial real estate services and investment management company. On June 12, 2026, Jones Lang LaSalle Incorporated (NYSE:JLL) closed at $299.95 per share. One-month return of Jones Lang LaSalle Incorporated (NYSE:JLL) was 3.82%, and its shares gained 24.73% over the past 52 weeks. Jones Lang LaSalle Incorporated (NYSE:JLL) has a market capitalization of $13.92 billion.
Baron Real Estate Fund stated the following regarding Jones Lang LaSalle Incorporated (NYSE:JLL) in its Q1 2026 investor letter:
“CBRE Group, Inc. and Jones Lang LaSalle Incorporated (NYSE:JLL), two leading commercial real estate services firms, were detractors in the first quarter. Business fundamentals remain strong, with broad-based momentum across segments and management teams expressing healthy outlooks. The share price declines — roughly 20% over two days — were driven by an abrupt shift in investor sentiment around AI and its potential impact on certain business lines, not by any deterioration in fundamentals.
We take the AI question seriously. The technology is advancing rapidly, and its long-term implications are not yet fully knowable. That said, we believe CBRE and JLL are among the companies best positioned to navigate this transition — not despite AI, but because of it. Both have been early adopters, deploying AI to sharpen their competitive advantages and accelerate market share gains. We consider them AI winners, not AI casualties.
The structural investment case remains intact: commercial real estate outsourcing continues to grow, institutional ownership of the asset class is expanding, and both companies are gaining share in a highly fragmented market. We believe we are in the early stages of a recovery in commercial real estate sales and leasing activity. Against that backdrop, we see a credible path to mid-to-high-teens annual earnings per share growth over the next few years — and following the recent pullback, we find valuations undemanding.”
Jones Lang LaSalle Incorporated (NYSE:JLL) is not on our list of 40 Most Popular Stocks Among Hedge Funds Heading Into 2026. According to our database, 42 hedge fund portfolios held Jones Lang LaSalle Incorporated (NYSE:JLL) at the end of the first quarter, the same as in the previous quarter. While we acknowledge the risk and potential of Jones Lang LaSalle Incorporated (NYSE:JLL) 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 JONES LANG LASALLE INCORPORATED (NYSE:JLL) and that has 10,000% upside potential, check out our report about this cheapest AI stock.
In another article, we covered Jones Lang LaSalle Incorporated (NYSE:JLL) and shared Baron Capital’s insights on the company. In addition, please check out our hedge fund investor letters Q1 2026 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.
