Bill Ackman Invests in Howard Hughes to Diversify Real Estate Holdings

Bill Ackman’s Pershing Square fund is collaborating with Howard Hughes Holdings (NYSE: HHH) to evolve its real estate business into a diversified holding company, similar to Berkshire Hathaway. Investors interested in Ackman’s strategies can look at Pershing Square’s quarterly filings, revealing $13.6 billion in equity holdings, with over half allocated to three main stocks.

Investment Focus: Uber Technologies

Uber Technologies (NYSE: UBER) is now the largest holding in Pershing Square’s portfolio, valued at approximately $2.6 billion. Ackman invested $2.3 billion in Uber in early 2025, dismissing concerns that autonomous vehicles will harm the company. With a user base exceeding 170 million, Uber’s network is valuable for self-driving car firms, potentially enhancing their growth.

Uber reported a 35% year-over-year increase in earnings before interest, taxes, depreciation, and amortization (EBITDA) last quarter. The company anticipates similar growth moving forward, bolstered by a 14% rise in gross bookings. It also achieved $2.3 billion in free cash flow for the last quarter, up 66% year-over-year.

Despite strong growth prospects, Uber’s stock remains reasonably priced, trading at an enterprise value-to-EBITDA ratio near 25, which is attractive for a company growing EBITDA at about 30% annually.

Investment Focus: Brookfield

Brookfield (NYSE: BN) is a diversified asset management firm, established in 2024, with a focus on real estate, renewable energy, and infrastructure. Pershing Square’s stake has increased to about $2.4 billion after acquiring an additional 6.1 million shares.

Brookfield operates multiple publicly traded subsidiaries, including Brookfield Asset Management (NYSE: BAM). The company saw a 27% increase in distributable earnings in the first quarter, aided by divestments. Management targets a 20%-plus annual cash flow growth rate through 2029, enhancing its capital for new investments.

Ackman notes that Brookfield’s market capitalization predominantly reflects its public equity holdings, suggesting undervaluation. The shares currently trade at 13.8 times trailing distributable earnings, below the projected valuation range of 16-18 times.

Investment Focus: Howard Hughes Holdings

Ackman’s investment in Howard Hughes Holdings focuses on its premier real estate assets amid a housing shortage. Pershing Square recently acquired 9 million newly issued shares, translating to a 47% ownership valued at approximately $1.9 billion.

Management values Howard Hughes’ assets at $5.9 billion, suggesting the stock trades at a discount. Anticipated net operating income growth is forecasted at 4% for 2025, with a long-term outlook of 37% growth by 2028.

Ackman plans to leverage Howard Hughes’ free cash flow for diversification and intends to introduce an insurance business. This move aims to replicate Berkshire Hathaway’s evolution, utilizing premiums to generate investment capital.