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 Ventas, Inc. (NYSE:VTR). Ventas, Inc. (NYSE:VTR) is a US-based real estate investment trust that owns and manages senior housing, life science, and medical office buildings. On April 2, 2026, Ventas, Inc. (NYSE:VTR) closed at $83.27 per share. One-month return of Ventas, Inc. (NYSE:VTR) was -1.89%, and its shares gained 27.11% over the past 52 weeks. Ventas, Inc. (NYSE:VTR) has a market capitalization of $39.55 billion.
Baron Real Estate Income Fund stated the following regarding Ventas, Inc. (NYSE:VTR) in its fourth quarter 2025 investor letter:
“We added to our senior housing investment theme by purchasing additional shares of Ventas, Inc. (NYSE:VTR). Ventas is an operator of senior housing, life science, and medical office buildings. We have been encouraged by the company’s continued robust fundamental results, growing investment momentum in its external growth pipeline (expected at over $2.5 billion for the year) and increasing openness to shedding slower growth assets to redeploy proceeds into higher growth areas.
As outlined in prior letters, we continue to be optimistic about the prospects for both cyclical and secular growth in senior housing demand against a backdrop of muted supply that will lead to several years of favorable growth. Among senior housing operators, we believe shares of Ventas remain attractively valued given our expectation of approximately 10% underlying per share growth, the company’s increasing mix of senior housing operating assets (currently at approximately 50% of cash flow), its declining leverage levels, and the company’s ability to capitalize on a robust external growth opportunity.”
Ventas, Inc. (NYSE:VTR) is not on our list of 40 Most Popular Stocks Among Hedge Funds Heading Into 2026. According to our database, 53 hedge fund portfolios held Ventas, Inc. (NYSE:VTR) at the end of the fourth quarter, up from 40 in the previous quarter. While we acknowledge the risk and potential of Ventas, Inc. (NYSE:VTR) 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 Ventas, Inc. (NYSE:VTR) and that has 10,000% upside potential, check out our report about this cheapest AI stock.
In another article, we covered Ventas, Inc. (NYSE:VTR) and shared a list of best real estate stocks to buy according to hedge funds. In addition, please check out our hedge fund investor letters Q4 2025 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.
