I N S I D E T H E B A R O N F U N D S

Baron Real Estate Fund

INVESTOR
The Case for Real Estate – Opportunities Abound

T
he COVID pandemic and post-pandemic macro environment have had a significant impact on virtually all
segments of real estate. We believe that, now more than ever, it is critical to have an active manager at
the helm of any real estate equity portfolio. While some categories are poised for outperformance, other
categories are taking a substantial and possibly long-lasting hit from the economic fallout caused by the
pandemic.
The Baron Real Estate Fund is an actively managed, growth equity real estate fund managed by Jeff Kolitch since
its 2009 inception. Unlike most of its peers, the Fund does not limit itself to REITs but expands its universe of
investable stocks to non-REIT real estate companies that operate within or provide services or products to the
real estate industry.
This differentiated approach has produced excellent results. Jeff Kolitch
Portfolio Manager

• Baron Real Estate Fund is in the top 1% of all real estate funds for its 10-year, 5-year, and 3-year performance, according to
Morningstar.
• Since its launch on December 31, 2009, the Fund has increased 386.47% cumulatively (net of fees) versus the MSCI USA IMI
Extended Real Estate Index and MSCI US REIT Index which have increased 253.31% and 163.87%, respectively.
• Baron Real Estate Fund has a 5-Star Morningstar Rating TM for its overall, 3-year, 5-year, and 10-year

performance

Baron Real Estate Fund’s annualized returns for the Institutional Shares as of December 31, 2022: 1-year, (28.44)%; 3-year, 8.69%; 5-year, 7.65%;
10-year, 10.28%; Since Inception (12/31/2009), 12.94%. The annual expense ratio for the Institutional Shares as of December 31, 2021 was 1.05%.
The MSCI USA IMI Extended Real Estate Index’s annualized returns as of December 31, 2022: 1-year, (23.84)%; 3-year, 2.72%; 5-year, 4.73%;
10-year, 8.59%; Since Fund Inception, 10.20%. The MSCI US REIT Index’s annualized returns as of December 31, 2022: 1-year, (25.37)%, 3-year,
(1.16)%, 5-year, 2.48%, 10-year, 5.20%, Since Fund Inception, 7.75%.
Performance is net of annual operating expenses.
The performance data quoted represents past performance. Past performance is no guarantee of future results. The investment return and principal
value of an investment will fluctuate; an investor’s shares, when redeemed, may be worth more or less than their original cost. The Adviser reimburses
certain Baron Fund expenses pursuant to a contract expiring on August 29, 2033, unless renewed for another 11-year term and the Fund’s transfer
agency expenses may be reduced by expense offsets from an unaffiliated transfer agent, without which performance would have been lower. Current
performance may be lower or higher than the performance data quoted. For performance information current to the most recent month end, visit
www.BaronFunds.com or call 1-800-99BARON.
As of 12/31/2022, the Morningstar RatingsTM were based on 233, 210, 152, and 233 share classes for the 3-year, 5-year, 10-year, and
Overall periods, respectively. Baron Real Estate Fund received 5, 5, 5, and 5 stars, respectively. The Morningstar Ratings are for the
Institutional Share Class only; other classes may have different performance characteristics. The Morningstar Ratings are based on the
Morningstar Risk-Adjusted Return measures.
As of 12/31/2022, the Morningstar Real Estate Category consisted of 252, 233, 210, and 152 share classes for the 1-, 3-, 5-, and 10-year
periods. Morningstar ranked Baron Real Estate Fund Institutional Share Class in the 86th, 1st, 1st, and 1st percentiles, respectively.
Morningstar calculates the Morningstar Real Estate Category Average performance and rankings using its Fractional Weighting
methodology. Morningstar rankings are based on total returns and do not include sales charges. Total returns do account for
management, administrative, and 12b-1 fees and other costs automatically deducted from fund assets.

BARON INVESTOR 1
A More Balanced and Expansive Approach • Life sciences REIT Alexandria Real Estate Equities, Inc. should
benefit from additional life science office space requirements amid
Baron Real Estate Fund Portfolio Manager Jeff Kolitch joined Baron from
increased research and development budgeting for pharmaceutical
Goldman Sachs in 2005 as a real estate analyst and brings more than
and biotechnology companies.
31 years of investment experience to his position. Jeff and his team
apply Baron’s research-intensive, fundamental, bottom-up approach to • Single-family rental REITs like Invitation Homes, Inc. are benefiting
find and invest for the long term in real estate and real estate-related from constrained home ownership affordability, high student-debt
companies that they believe benefit from sustainable competitive burdens, the preference for flexibility with renting, and the recent
advantages, excellent management, and strong long-term growth spike in mortgage rates.
opportunities, at an attractive valuation.
• Manufactured housing REIT Equity LifeStyle Properties, Inc. is a
Baron Real Estate Fund invests in a broader and more comprehensive prime beneficiary of budget-conscious home buyers such as retirees
variety of commercial and residential real estate-related categories – and millennials and negligible new inventory due to high
not just REITs. We believe this more balanced and expansive approach development barriers.
should continue to produce strong results over the long term. We also
• Gaming REITs Gaming and Leisure Properties, Inc. owns quality
believe this approach is highly complementary to funds such as Baron
casino and gaming real estate properties, has attractive dividends,
Real Estate Income Fund that invest primarily in REITs.
and has accretive acquisition growth opportunities.
The main real estate categories in which we invest include:
Residential-Related Real Estate
• REITs
• Residential-related real estate companies • Homebuilders and land developers
• Homebuilders and land developers Cyclically depressed levels of construction activity, low inventory
• Building products/services levels, pent-up demand, higher consumer savings, and a rebound in
• Home centers job growth are benefiting the U.S. housing market. The current
• Travel-related real estate companies situation is nothing like what occurred during the global financial
• Casinos and gaming companies crisis when our country was significantly oversupplied relative to the
• Hotels and leisure demographic and demand needs.
• Other real estate-related categories
• Commercial real estate services companies • Building product/services and home centers The building products/
• Real estate-focused alternative asset managers services and home center category includes manufacturers of
• Property technology companies building components, home improvement products, and equipment
and home centers. We think this segment has room to grow even
While the portfolio weights of these real estate categories will vary with the uncertainty regarding the length and depth of the economic
according to our ongoing research of industry and company-specific downturn, job loss, wage growth, etc. With the shift to hybrid and
factors, these are the main categories on which we focus. full-time work-from-home arrangements, we think we will see more
REITs We believe several REITs present a highly unusual, tactical, and repair and remodeling spending activities. Companies we currently
strategic buying opportunity at this time. Several REITs are attractively favor include: Home Depot, Inc., Pool Corporation, Fortune Brands
valued relative to the broader equity market, bonds, and private real Home & Security, Inc., and Floor & Decor Holdings, Inc.
estate alternatives, in our opinion. However, you need to choose
Travel-Related Real Estate Companies
carefully. This is where our bottom-up, fundamental approach to
investing comes in. This category of hotels, casino and gaming companies, timeshares, ski
resorts, and cruise lines was the hardest hit segment of the real estate
REIT categories that we favor include: industry in the pandemic as such companies were forced to shut down
• Industrial REITs such as Prologis, Inc. and Rexford Industrial Realty, operations almost without exception. We exited the majority of our
Inc. are expected to continue to benefit from robust warehouse positions in these stocks early in 2020 at favorable prices. Since then
demand and increased rents. This is due, in part, to broader we have been selectively reinvesting at extremely favorable valuations.
e-commerce needs resulting from the accelerated growth of online We believe these businesses are cyclically depressed – not secularly
sales as businesses and consumers relentlessly seek faster delivery. challenged. Consequently, we expect the cash flows of many of these
real estate businesses to rebound as economic activity resumes. We
• Data center REIT Equinix, Inc. is poised to benefit from several have already witnessed the release of pent-up consumer and
tailwinds including the growth in the outsourcing of information commercial demand for several of the hardest hit segments of real
technology, increased cloud computing adoption, the growth in U.S. estate – particularly the travel-related segments of real estate.
mobile data and internet traffic, and the rapid transition to a world of
virtual meetings and conferencing. Many hotels and gaming companies have started the process of
reopening operations in select regions across the world. In addition,
• Wireless tower REITs such as American Tower Corp. are positioned regional gaming operators such as Boyd Gaming Corporation do not
to grow for several years as the demand for data-intensive devices have to contend with air flight restrictions as most of their business is
accelerates and new wireless technologies continue to emerge and local. Many of the hospitality-related real estate companies have
improve. already regained a percentage of their value since hitting bottom.

2 BARON INVESTOR
Nevertheless, we think they still have a way to go and believe several Conclusion
hospitality-related real estate companies remain heavily discounted to Within each of these real estate categories, we conduct fundamental,
their likely two-to-three year prospective value. Examples include bottom-up research to find the companies that we think offer the most
casino and gaming companies, vacation timeshare companies (Marriott promising opportunities for long-term growth. We look for long-term
Vacations Worldwide Corp.), and ski resorts (Vail Resorts, Inc.). secular and cyclical growth opportunities with large addressable
Commercial Real Estate Services Companies markets. For example, CoStar Group is tapping the explosive growth in
data generation and consumption to serve its commercial real estate
As the name suggests, commercial real estate services companies end market.
service the commercial real estate industry. While the pandemic clearly
has had a short-term negative impact and possibly a more permanent, Sustainable competitive advantages are also key; thus, many of our
longer-term negative impact on the retail and office segments of the holdings are leaders in their categories and/or have built or secured
commercial real estate market, we believe the companies in which we irreplaceable assets with high barriers to entry. For instance, American
invest that service these end markets are well positioned for growth Tower benefits from regulations that restrict the number of towers that
regardless. All are leaders in the businesses in which they operate, with can be built, forcing carriers to lease space on existing towers.
what we think are significant competitive advantages and excellent An attractive business model is another important attribute, including a
management. For instance, CBRE Group, Inc., the largest and leading solid balance sheet with appropriate debt, strong free cash flow
commercial real estate services firm in the world, has unmatched scale, conversion, and recurring or reoccurring revenue. In our experience, a
product breadth, and leadership positions across its diversified real well-run company with a sound business model is more likely to survive
estate business segments. The company continues to pull away from in downturns and potentially even benefit as weaker competitors go out
the pack, gaining market share in each of its businesses. It is the “go to” of business or weaken to the stage that they become attractive targets
commercial real estate services firm for clients, other real estate for acquisition.
brokers, and employees.
We also seek exceptional management. Management can make or break a
Real Estate-Focused Alternative Asset Managers company. The graveyard of failed companies is rife with examples of
Brookfield Asset Management, Inc. is one of the largest global mismanagement of otherwise-promising businesses. In addition, a firm’s
alternative asset managers primarily focused on infrastructure and real culture – the shared beliefs, values, and standards – is shaped by
estate investments with approximately $750 billion in assets under management. We look for a track record of successful capital allocation
management. We believe the company is well positioned for growth and ability to reinvest for growth. Brookfield Asset Management CEO
given increasing institutional allocations to alternative assets primarily Bruce Flatt, who has spoken at our annual conference, is one such
due to historically low interest rates. We expect the company to example. Brookfield is now one of the world’s largest real estate asset
continue to increase its market share given its superior long-term managers, with a portfolio of commercial real estate, infrastructure, and
investment track record, its global reach, and its diverse product renewable energy that spans the globe.
platform. Brookfield recently bought Oaktree, the world’s premier
Finally, we look for an attractive valuation. We project the long-term
distressed credit asset management firm. We believe this stock trades
intrinsic value of every stock we own using quantitative and qualitative
at a healthy discount to our assessment of intrinsic value.
analysis. Our financial analysis incorporates key revenue growth drivers,
Property Technology Companies profitability, cost structure, and capital structure. Qualitative factors
include the total addressable market, sustainability of the competitive
The impact of technology on real estate is undeniable. The growth in
advantage, and strength of the management team.
cloud computing, the internet, mobile data and cellphones, and wireless
infrastructure are powerful secular drivers that should continue We focus our purchases on what we believe to be “best-in-class”
unabated for years and are impacting real estate, along with many companies. In our judgment, characteristics of a “best-in-class” real
other industries. Real estate-related companies that embrace and adopt estate company are that it:
the latest technological advances and innovations are an important
• Owns unique and well-located real estate assets in markets with high
focus for us. Key beneficiaries of the technology revolution include data
barriers to entry combined with attractive long-term demand
center companies, wireless tower companies, industrial REITs, and real
demographics
estate data analytic companies.
• Enjoys strong long-term growth prospects together with a leading
If anything, the pandemic has accelerated these secular trends as more competitive position
people conduct business, leisure, residential, and commerce activities • Maintains a conservative and liquid balance sheet
online. Examples of companies we believe are poised to benefit from • Employs an intelligent and motivated management team whose
accelerating digitization include data center REIT Equinix, wireless tower interests are aligned with shareholders
REIT American Tower, and industrial logistics REITs Prologis and Rexford
In addition, we purchased a number of cyclical stocks that had declined
Industrial Realty.
sharply during the pandemic but possess the potential to appreciate
Another example, real estate data analytic company CoStar Group, significantly over the next few years, in our view. Upon the resumption
Inc. has built a proprietary database over a 20-year period to provide of normalized economic activity, we anticipate that the shares of many
marketing, analytics, and information services to the commercial real beaten down cyclical companies, such as travel and hospitality-related
estate industry, creating a dominant market position and high barrier real estate companies and certain REITs, may lead the market higher.
to entry.

BARON INVESTOR 3
Investors should consider the investment objectives, risks, and charges and expenses of the investment carefully before investing. The prospectus and
summary prospectuses contain this and other information about the Funds. You may obtain them from the Funds’ distributor, Baron Capital, Inc., by
calling 1-800-99BARON or visiting www.BaronFunds.com. Please read them carefully before investing.
Risks: In addition to general market conditions, the value of the Fund will be affected by the strength of the real estate markets as well as by interest rate fluctuations, credit
risk, environmental issues and economic conditions. The Fund invests in companies of all sizes, including small and medium sized companies whose securities may be thinly
traded and more difficult to sell during market downturns.
The discussion of market trends is not intended as advice to any person regarding the advisability of investing in any particular security. The views expressed in this document
reflect those of the respective writer. Some of our comments are based on management expectations and are considered “forward-looking statements.” Actual future results,
however, may prove to be different from our expectations. Our views are a reflection of our best judgment at the time and are subject to change at any time based on market
and other conditions and Baron has no obligation to update them.
The Morningstar RatingTM for funds, or “star rating”, is calculated for managed products (including mutual funds, variable annuity and variable life subaccounts, exchange-traded
funds, closed-end funds, and separate accounts) with at least a three-year history. Exchange-traded funds and open-ended mutual funds are considered a single population for
comparative purposes. It is calculated based on a Morningstar Risk-Adjusted Return measure that accounts for variation in a managed product’s monthly excess performance,
placing more emphasis on downward variations and rewarding consistent performance. The Morningstar Rating does not include any adjustment for sales loads. The top 10% of
products in each product category receive 5 stars, the next 22.5% receive 4 stars, the next 35% receive 3 stars, the next 22.5% receive 2 stars, and the bottom 10% receive 1 star.
The Overall Morningstar Rating for a managed product is derived from a weighted average of the performance figures associated with its three-, five-, and 10-year (if applicable)
Morningstar Rating metrics. The weights are: 100% three-year rating for 36-59 months of total returns, 60% five-year rating/40% three-year rating for 60-119 months of total
returns, and 50% 10-year rating/30% five-year rating/20% three-year rating for 120 or more months of total returns. While the 10-year overall star rating formula seems to give
the most weight to the 10-year period, the most recent three-year period actually has the greatest impact because it is included in all three rating periods.
© 2023 Morningstar. All Rights Reserved. The information contained herein: (1) is proprietary to Morningstar and/or its content providers; (2) may not be copied or distributed;
and (3) is not warranted to be accurate, complete or timely. Neither Morningstar nor its content providers are responsible for any damages or losses arising from any use of
this information. Past performance is no guarantee of future results.
Portfolio holdings as a percentage of total investments as of December 31, 2022 for securities mentioned are as follows: Rexford Industrial Realty, Inc. – 3.0%, Alexandria Real
Estate Equities, Inc. – 1.4%, Equity Lifestyle Properties, Inc. – 1.3%, Gaming and Leisure Properties, Inc. – 1.6%, Home Depot, Inc. – 0.3%, Pool Corporation – 2.5%,
Fortune Brands Home & Security, Inc. – 1.7%, Floor & Decor Holdings, Inc. – 2.9%, Boyd Gaming Corporation – 1.4%, Marriott Vacations Worldwide Corp. – 1.5%, Vail
Resorts, Inc. – 1.8%, Invitation Homes Inc. – 0.8%.
Portfolio holdings are subject to change. Current and future portfolio holdings are subject to risk.
The MSCI USA IMI Extended Real Estate Index is a custom index calculated by MSCI for, and as requested by, BAMCO, Inc. The index includes real estate and real estate-
related GICS classification securities. MSCI makes no express or implied warranties or representations and shall have no liability whatsoever with respect to any MSCI data
contained herein. The MSCI data may not be further redistributed or used as a basis for other indices or any securities or financial products. This report is not approved,
reviewed or produced by MSCI. The MSCI US REIT Index is a free float-adjusted market capitalization index that measures the performance of all equity REITs in the US equity
market, except for specialty equity REITs that do not generate a majority of their revenue and income from real estate rental and leasing operations. MSCI is the source and
owner of the trademarks, service marks and copyrights related to the MSCI Indexes. The indexes and the Fund include reinvestment of interest, capital gains and dividends,
which positively impact the performance results. The indexes are unmanaged. Index performance is not fund performance; one cannot invest directly into an index.
BAMCO, Inc. is an investment adviser registered with the U.S. Securities and Exchange Commission (SEC). Baron Capital, Inc. is a broker-dealer registered with the SEC and
member of the Financial Industry Regulatory Authority, Inc. (FINRA).

Baron Real Estate Fund

Top 10 Holdings as of December 31, 2022
% of Net
Holding Sector Assets
CoStar Group, Inc. Industrials 5.3
Prologis, Inc. Real Estate 5.2
Toll Brothers, Inc. Consumer Discretionary 4.9
Brookfield Corporation Inc. Financials 4.6
American Tower Corp. Real Estate 4.3
Equinix, Inc. Real Estate 3.9
CBRE Group, Inc. Real Estate 3.8
Lennar Corporation Consumer Discretionary 3.7
D.R. Horton, Inc. Consumer Discretionary 3.1
SiteOne Landscape Supply, Inc. Industrials 3.1
Total 41.9

4 BARON INVESTOR
Baron Sales & Relationship Management PRODUCTS WE OFFER
We offer 19 mutual funds in retail,
institutional, and R6 share classes,
BUSINESS DEVELOPMENT collective investment trusts, separately
KATYA ROSENBLATT VP, Head of Business Development, 212-583-2012, krosenblatt@baronfunds.com managed accounts, sub-advisory
services, UCITS, and other offshore
INSTITUTIONAL
vehicles.
JAMES BARRETT VP, Head of Institutional Sales, 212-583-2076, jbarrett@baronfunds.com
DAVID KAPLAN VP, Senior Director, Institutional Sales, 212-583-2033, dkaplan@baronfunds.com STRATEGIES
MEETA SINGAL VP, Director, Institutional Sales, 212-583-2055, msingal@baronfunds.com
JENNIFER NIGRO VP, Director, Institutional Sales, 212-583-2101, jnigro@baronfunds.com BARON DISCOVERY STRATEGY
DAVID CHOW VP, Director, Consultant Relations, 917-933-0173, dchow@baronfunds.com BARON SMALL CAP GROWTH STRATEGY
STEPHEN MILLAR VP, Head of EMEA, Institutional Sales, +44(0)7769 958822, smillar@baronfunds.com BARON OPPORTUNISTIC SMALL CAP
LUCY PESA Director, Public Funds & Taft/Hartley, 212-583-2143, lpesa@baronfunds.com
GROWTH STRATEGY
RIA AND FAMILY OFFICE GROUP BARON SMALL TO MID CAP GROWTH
FRANK MAIORANO VP, Head of RIA and Family Office Group, 212-583-2183, STRATEGY
fmaiorano@baronfunds.com BARON FOCUSED GROWTH STRATEGY
ROBIN THURAU VP, Regional Director – Northeast & Georgia, 212-583-2083, BARON MID CAP GROWTH STRATEGY
rthurau@baronfunds.com
BARON DURABLE ADVANTAGE STRATEGY
LIZ CASSAL VP, Regional Director – Pacific, 212-583-2178, lcassal@baronfunds.com
BRIAN McNAMARA CFA, VP, Regional Director – Midwest, 773-718-7444, bmcnamara@baronfunds.com BARON LARGE CAP GROWTH STRATEGY
ERIC BELGARD CFA, VP, Regional Director – Southeast, 212-583-2180, ebelgard@baronfunds.com BARON HIGH GROWTH STRATEGY
FRANK COSTIGLIOLA Regional Director – Rocky Mountains, 917-933-0122, fcostigliola@baronfunds.com BARON ALL CAP GROWTH STRATEGY
BARON EMERGING MARKETS STRATEGY
INTERMEDIARY AND NATIONAL ACCOUNTS
BARON GLOBAL ADVANTAGE STRATEGY
DAVID JUDICE VP, Head of Intermediary Sales and National Accounts, 212-583-2034,
djudice@baronfunds.com BARON INTERNATIONAL GROWTH
GLENN SMITH VP, National Sales Manager, 212-583-2007, gsmith@baronfunds.com STRATEGY
STEPHANIE GISRIEL VP, Director, National Accounts, 212-583-2187, sgisriel@baronfunds.com BARON HEALTH CARE STRATEGY
ROGER MACK VP, Director, National Accounts, 212-583-2131, rmack@baronfunds.com BARON REAL ESTATE STRATEGY
CHELSEA M. AMEEN VP, Director, National Accounts, 212-583-2158, cameen@baronfunds.com
BARON REAL ESTATE INCOME STRATEGY
BILL ZOROVICH VP, Regional Director – Northeast, 516-578-3478, bzorovich@baronfunds.com
SCOTT KOZIOL VP, Regional Director – Southeast, 404-433-6137, skoziol@baronfunds.com MUTUAL FUNDS
WAYNE OUIMETTE VP, Regional Director – West, 310-292-6255, wouimette@baronfunds.com
JENNIFER ROMMEL VP, Regional Director – Central, 773-450-7495, jrommel@baronfunds.com BARON DISCOVERY FUND
MARK J. WHITEHOUSE VP, Regional Director – New England, 603-661-8887, mwhitehouse@baronfunds.com BARON GROWTH FUND
RON STANKIEWICZ VP, Regional Director – NY Metro, 917-287-7248, rstankiewicz@baronfunds.com BARON SMALL CAP FUND
BRIAN CULLEN Regional Director – Mid-Atlantic, 203-912-4433, bcullen@baronfunds.com
BARON FOCUSED GROWTH FUND
CHARLES KRUGER Regional Director – Southwest, 917-882-2095, ckruger@baronfunds.com
JIMMY O’LEARY Regional Director – Rocky Mountains, 646-965-2657, joleary@baronfunds.com BARON ASSET FUND
IAN FORMAN Regional Director – Midwest, 845-642-1936, iforman@baronfunds.com BARON FIFTH AVENUE GROWTH FUND
MATT O’DONNELL Regional Director – Ohio Valley, 917-615-4879, modonnell@baronfunds.com BARON DURABLE ADVANTAGE FUND
ANDREW KRATSCH Regional Director – Northwest, 917-885-4387, akratsch@baronfunds.com BARON OPPORTUNITY FUND
CLIENT SERVICE BARON PARTNERS FUND
JANET LAM CHEN VP, Director, Client Service, 212-583-2162, jchen@baronfunds.com BARON EMERGING MARKETS FUND
BARON INTERNATIONAL GROWTH FUND
BARON GLOBAL ADVANTAGE FUND
BARON NEW ASIA FUND
BARON HEALTH CARE FUND
BARON REAL ESTATE FUND
BARON REAL ESTATE INCOME FUND
BARON FINTECH FUND
BARON TECHNOLOGY FUND
BARON WEALTHBUILDER FUND

BARON CAPITAL, INC.

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Non-mutual fund products are available to institutional investors only.
INVESTOR-REALESTATE 12/31/2022