Baron Capital, an investment management company, released its Q4 2025 letter for its āBaron Real Estate Fundā. 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 (ā0.96%) 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 Fundās 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 Public Storage (NYSE:PSA). Public Storage (NYSE:PSA) is a leading real estate investment trust that owns and operates self-storage facilities. On June 12, 2026, Public Storage (NYSE:PSA) closed at $324.71 per share. One-month return of Public Storage (NYSE:PSA) was 9.05%, and its shares gained 9.63% over the past 52 weeks. Public Storage (NYSE:PSA) has a market capitalization of $57.21 billion.
Baron Real Estate Fund stated the following regarding Public Storage (NYSE:PSA) in its Q1 2026 investor letter:
“During the quarter, we reestablished a position in Public Storage (NYSE:PSA) the best-in-class self-storage REIT with a portfolio of more than 3,500 U.S. properties. We had been cautious about self-storage for several years, given a prolonged period of flat to-negative growth. Our view has shifted. Recent due diligence suggests a fundamental inflection may be approaching ā one where stabilizing demand and rents, combined with declining new supply, could drive a reacceleration in growth beginning in 2026ā¦.ā (Click here to read the full text)
Public Storage (NYSE:PSA) is not on our list of 40 Most Popular Stocks Among Hedge Funds Heading Into 2026. According to our database, 39 hedge fund portfolios held Public Storage (NYSE:PSA) at the end of the first quarter, compared to 40 in the previous quarter. While we acknowledge the potential of Public Storage (NYSE:PSA) as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you’re looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.