Cohen & Steers Gains Momentum — But Can Private Real Estate Fill the Gap?

Date of Call: Jan 23, 2026

Financials Results

• Revenue: Q4: $143.8M, up 2% sequentially. Full year: $554M, up 6.9% YOY.
• EPS: Q4: $0.81 per share, equal to prior quarter. Full year: $3.09 per share, up from $2.93 in 2024.
• Operating Margin: Q4: 36.4%, compared to 36.1% in the prior quarter. Full year: up 6.3% to $195.1M.

Guidance:

• Compensation ratio expected to remain at 40% in 2026.
• Annual G&A growth in 2026 projected to be in the mid-single-digit percentage range.
• Effective tax rate expected to be 25.4% on an as-adjusted basis for 2026.

Business Commentary:

Revenue and AUM Growth:

• Cohen & Steers reported revenue of $143.8 million for Q4, up 2% sequentially, and $554 million for the full year 2025, up 6.9% year-on-year. Ending AUM was $90.5 billion.
• The growth was driven by higher average AUM and recognition of performance fees.

Net Inflows and Pipeline:

• The company experienced net inflows of $1.2 billion in Q4, marking the fifth consecutive quarter with net inflows. The one-but-unfunded pipeline reached $1.72 billion.
• The inflows were primarily driven by advisory and closed-end funds, while the pipeline strengthen due to increased confidence in the macro environment and interest rate cycle.

Compensation and Expense Management:

• Cohen & Steers reported a compensation ratio of 39% for Q4 and 40% for the full year, slightly below the guidance of 40.5%.
• The decrease was due to controlled incentive compensation expenses and increased G&A expenses related to travel, business development, and talent acquisition.

Investment Performance and Outlook:

• The company's strategies showed strong performance, with natural resource equities leading at 30% and global listed infrastructure at 14%. The nontraded REIT, CNS REIT, achieved a 10.3% annualized return since its inception.
• The positive performance is attributed to reduced tariff uncertainty, expectations for stronger economic growth, and structural growth in resource and infrastructure sectors.

Sentiment Analysis:

Overall Tone: Positive

• CEO states 'We ended 2025 with good momentum across key business metrics.' CFO notes 'solid revenue growth' and 'another quarter of net inflows.' CIO expects economic activity and market returns to broaden and become 'more favorable' for real assets, with rotations already underway and a 'multiyear commodity super cycle' in natural resources.

Q&A:

• Question from John Dunn (Evercore ISI Institutional Equities): Are you seeing signs of improving demand for private real estate, and can it be a more significant contributor in 2026?
  Response: Management sees early, positive signs of renewed interest, driven by capital potentially flowing from troubled private credit markets. They are well-positioned with their non-traded REIT.

• Question from John Dunn (Evercore ISI Institutional Equities): Can active ETFs scale more quickly for you because they are based on established strategies?
  Response: Yes, active ETFs have the potential to scale rapidly due to proven underlying strategies and growing market preference for the vehicle, as evidenced by accelerating adoption rates.

• Question from Rodrigo Ferreira (BofA Securities): What is the recent progress in the institutional channel, and where can it go from here?
  Response: The institutional pipeline has strengthened and broadened over the past two quarters, driven by a better environment with more portfolio flexibility and a return to real asset allocations. The company is investing more in this segment.

• Question from Rodrigo Ferreira (BofA Securities): Has the amount won and funded intra-quarter on the one but unfunded pipeline been increasing, and what dynamics are driving that?
  Response: The increase in intra-quarter funding is a reflection of the broader positive dynamic in business activity but is consistent with the company's longer-term historical pattern.

• Question from John Dunn (Evercore ISI Institutional Equities): What are the regional demand dynamics for advisory and subadvisory, particularly outside the U.S.?
  Response: Geographic concentration is expanding; allocator domiciles include Belgium, Canada, Japan, Philippines, and the U.K. The company is allocating more resources to non-U.S. markets.

• Question from John Dunn (Evercore ISI Institutional Equities): What dynamics could change to make global real estate a tailwind?
  Response: Increased demand from global institutions and a shift in U.S. investors' perceptions as international markets recover and outperform, reversing years of underperformance.

• Question from Macrae Sykes (Gabelli Funds): What areas of demand are you seeing for active ETFs, and have there been any surprises?
  Response: Demand is primarily from independent RIAs and existing open-end fund holders converting to ETFs. Cannibalization is in line with expectations, and the strategy is net-positive.

Contradiction Point 1

Institutional Pipeline Composition and Growth Outlook

Contradiction on the strength and nature of the institutional pipeline.

What's the recent progress in the institutional channel, how does it compare to a year ago, and where do you see it heading? - Rodrigo Ferreira (BofA Securities)

2025Q4: The Institutional pipeline has strengthened and broadened over the past two quarters, with more mandates, global allocators, and strategies. - Joseph Harvey(CEO)

What is the geographic client-type profile of investors providing capital, and are there other investment areas besides U.S. REITs where investors are focusing? - John Dunn (Evercore ISI Institutional Equities)

2025Q3: The institutional pipeline is predominantly from North America... The pipeline includes strategic allocation changes, wins from underperforming peer managers, and new allocations across real estate and infrastructure. - Joseph Harvey(CEO)

Contradiction Point 2

Institutional Client Geographical Demand

Contradiction on the geographical expansion and diversification of institutional demand.

Are there any pockets of demand globally for institutional advisory and subadvisory services? - John Dunn (Evercore ISI)

2025Q4: Geographic demand for institutional advisory is expanding beyond the U.S. Allocators are diversifying away from U.S.-centric portfolios. Recent institutional wins include mandates from Belgium, Canada, Japan, the Philippines, and the U.K. - Joseph Harvey(CEO)

Could you provide a geographic client profile and specify sectors or regions beyond U.S. REITs where investors are allocating capital? - John Dunn (Evercore ISI Institutional Equities)

2025Q3: The institutional pipeline is predominantly from North America... An example of a non-U.S. allocation is a European institution... - Joseph Harvey(CEO)

Contradiction Point 3

Demand Drivers for Global Real Estate Strategies

Different explanations for strong global real estate flows between quarters.

What dynamics in global real estate could turn it into a tailwind? - John Dunn (Evercore ISI)

2025Q4: Two key dynamics could boost global real estate demand: 1) Reacceleration of interest from global institutions... 2) Shift in U.S. investor behavior as international real estate underperformance relative to the U.S. ends. - John Cheigh(President & Chief Investment Officer)

Were the stronger global real estate flows in Q2 driven by U.S. or international investors, and have you observed any shift away from U.S. real estate after the liberation date? - Rodrigo Ferreira (BofA Securities)

2025Q2: Flows into global strategies have been stronger partly due to international components underperforming relative to U.S. markets, creating an 'American exceptionalism' dynamic. - Joseph Martin Harvey(CEO)

Contradiction Point 4

Gross Sales Performance and Seasonality in Wealth Management

Contradiction on recent gross sales trend and its seasonality.

Are you seeing improved demand for private real estate and could it become a significant contributor in 2026? - John Dunn (Evercore ISI)

2025Q4: Gross sales in Q2 were about 10% lower recently but there is some seasonality, with a dip in Q2 over the past 3-4 years. - Joseph Martin Harvey(CEO)

Could you provide an update on the wealth management channel's current state, including the appetite for gross sales and which strategies are favored or less favored? Additionally, do you anticipate any seasonal trends affecting the next six months? - John Dunn (Evercore ISI)

2025Q4: Early signs of improving interest in private real estate are emerging... The company's nontraded REIT is well-positioned... to capitalize on this potential transition. - Joseph Harvey(CEO & Director)

Contradiction Point 5

Institutional Unfunded Pipeline Dynamics

Contradiction on the cause and nature of changes in the institutional unfunded pipeline.

Has the amount you're winning and funding intra-quarter from the unfunded pipeline been increasing, and what dynamics are driving this trend? - Rodrigo Ferreira (BofA Securities)

2025Q4: The increase in intra-quarter funding is consistent with the broader positive business dynamic but is not unique to recent quarters. It reflects the overall improved flow environment rather than a specific new trend. - Joseph Harvey(CEO)

Is the low institutional unfunded pipeline this quarter an anomaly, or has a similar level been observed before? - John Dunn (Evercore ISI)

2025Q1: The low pipeline ($61M vs. $531M last quarter) is attributed to completed fundings and timing of final client decisions. - Joseph Harvey(CEO)