LOS
ANGELES, May 29, 2024 /PRNewswire/ -- Rexford
Industrial Realty, Inc. (the "Company" or "Rexford Industrial")
(NYSE: REXR), a real estate investment trust focused on creating
value by investing in and operating industrial properties located
throughout infill Southern
California, today announced second quarter-to-date operating
and transaction activity updates in advance of upcoming
investor meetings.
"Rexford Industrial's quarter-to-date leasing activity
demonstrates the health of our underlying tenant
demand fundamentals, differentiated by
Rexford Industrial's focus on delivering the
highest-quality and most functional industrial
product serving a tenant base occupying space averaging
25,000 square feet in our infill Southern
California portfolio, within the nation's highest-barrier and
most supply-constrained industrial market," stated
Michael Frankel and Howard Schwimmer, Co-Chief Executive Officers of
the Company. "Additionally, our quarter-to-date investment and
disposition activity continue to evidence Rexford
Industrial's disciplined approach to highly-accretive capital
allocation, positioning the Company for near- and
long-term value creation for our stakeholders."
Operating Activity:
In the second quarter to date,
Rexford Industrial executed 1.125 million square feet of
new and renewal leases, with an average size of 16,000 square
feet, including approximately 675,000 square feet of renewal
leases and 450,000 square feet of new leases.
Comparable rental rates on new and renewal leases increased by
68% compared to prior rents on a net effective basis and by 51% on
a cash basis, in line with expectations. Average annual rent
steps grew to 4.1% for leases executed
quarter to date, compared to 4.0% during the prior
quarter. As of May 22, 2024, the
Company's Same Property Portfolio occupancy was 96.5%,
representing a 10 basis point increase compared to the prior
quarter end.
Transaction Activity:
In May, Rexford Industrial completed two industrial
property investments for an aggregate purchase price of
$143 million and completed the
disposition of three properties for an aggregate sales price
of $27 million. The acquisitions were funded using
cash on hand and 1031 exchange disposition proceeds. Year
to date, Rexford Industrial has completed $1.3 billion of investments and $37 million of dispositions.
The Company acquired:
- 1901 E Rosslynn Avenue, Fullerton, located in the North Orange County submarket, for
$94.3 million or $338 per square foot. The 12-acre site comprises
a 278,572 square foot, single-tenant industrial building featuring
30-foot clear height and excess land for outside storage and
trailer parking, which is leased to a highly entrenched tenant. The
investment generates an initial unlevered cash yield of 5.6%,
growing through annual embedded rent steps of 4.25%. According to
CBRE, the vacancy rate in the 115 million square foot North Orange County submarket was 1.0% at the
end of the first quarter 2024.
- 16203-16233 Arrow Highway, Irwindale, located in the LA – San Gabriel
Valley submarket, for $48.5 million
or $360 per square foot through an
off-market transaction. The 6-acre site contains 134,542 square
feet of improvements comprising four newly developed, Class-A
industrial buildings featuring best-in-class 30-foot warehouse
clear height and highly-sought-after dock-high loading. The
investment generates an initial unlevered cash yield of 6.2%,
growing through average annual embedded rent steps of 4.2%.
According to CBRE, the vacancy rate in the 161 million square foot
LA – San Gabriel Valley submarket was 3.0% at the end of the first
quarter 2024.
The Company disposed of:
- 6407-6431 Alondra Boulevard, Paramount, located in the LA –
South Bay submarket, for $7.6 million
or $251 per square foot. The two
multi-tenant buildings total 30,224 square feet and were 81%
occupied at the time of sale. The unlevered IRR to the Company is
16.6%.
- 15401 Figueroa Street, Los
Angeles, located in the LA – South Bay submarket, for
$10.2 million or $265 per square foot. The 38,354 square foot
single-tenant industrial building was sold vacant to a user for an
unlevered IRR to the Company of 12.6%.
- 8210 Haskell Avenue, Los
Angeles, located in the LA – Greater San Fernando Valley
submarket, for $9.2 million or
$351 per square foot. The 26,229
square foot single-tenant industrial building was sold vacant to a
user for an unlevered IRR to the Company of 9.6%.
The Company currently has a near-term acquisition pipeline
comprising approximately $40 million of new investments
within prime infill Southern
California industrial markets under contract or accepted
offer.
About Rexford Industrial
Rexford Industrial creates value by investing in, operating and
redeveloping industrial properties throughout infill Southern California, the world's fourth
largest industrial market and consistently the highest-demand,
lowest supply market in the nation. The Company's highly
differentiated strategy enables internal and external growth
opportunities through its proprietary value creation and asset
management capabilities. Rexford Industrial's high-quality,
irreplaceable portfolio comprises 422 properties with
approximately 49.5 million rentable square feet occupied
by a stable and diverse tenant base. Structured as a real estate
investment trust (REIT) listed on the New York Stock Exchange under
the ticker "REXR," Rexford Industrial is an S&P MidCap 400
Index member. For more information, please visit
www.rexfordindustrial.com.
Forward-Looking Statements
This press release may contain forward-looking statements within
the meaning of the federal securities laws, which are based on
current expectations, forecasts and assumptions that involve risks
and uncertainties that could cause actual outcomes and results to
differ materially. Forward-looking statements relate to
expectations, beliefs, projections, future plans and strategies,
anticipated events or trends and similar expressions concerning
matters that are not historical facts. In some cases, you can
identify forward-looking statements by the use of forward-looking
terminology such as "may," "will," "should," "expects," "intends,"
"plans," "anticipates," "believes," "estimates," "predicts," or
"potential" or the negative of these words and phrases or similar
words or phrases which are predictions of or indicate future events
or trends and which do not relate solely to historical matters.
While forward-looking statements reflect the Company's good faith
beliefs, assumptions and expectations, they are not guarantees of
future performance. For a further discussion of these and other
factors that could cause the Company's future results to differ
materially from any forward-looking statements, see the reports and
other filings by the Company with the U.S. Securities and Exchange
Commission, including the Company's Annual Report on Form 10-K for
the year ended December 31, 2023. The
Company disclaims any obligation to publicly update or revise any
forward-looking statement to reflect changes in underlying
assumptions or factors, of new information, data or methods, future
events or other changes.
Definitions
Initial Unlevered Cash Yield: Calculated by dividing an
investment's initial annual cash NOI by its first-year investment
which includes the sum of the purchase price, closing costs,
anticipated nonrecurring capital expenditures, anticipated tenant
improvement allowances/costs and leasing commissions, if any.
Rent Change – Cash: Compares the first month cash rent
excluding any abatement on new/renewal leases to the last month
rent for the most recent expiring lease. Data included for
comparable leases only. Comparable leases generally exclude: (i)
space that has never been occupied under our ownership, (ii)
repositioned/redeveloped space, including space in
pre-development/entitlement process, (iii) space that has been
vacant for over one year or (iv) lease terms shorter than twelve
months.
Rent Change – Net Effective: Compares GAAP rent, which
straightlines rental rate increases and abatements, on new/renewal
leases to GAAP rent for the most recent expiring lease. Data
included for comparable leases only. Comparable leases generally
exclude: (i) space that has never been occupied under our
ownership, (ii) repositioned/redeveloped space, including space in
predevelopment/entitlement process, (iii) space that has been
vacant for over one year or (iv) lease terms shorter than twelve
months.
Same Property Portfolio: Our 2024 Same Property
Portfolio is a subset of our consolidated portfolio and includes
properties that were wholly owned by us for the period
from January 1, 2023 through May 22, 2024, and
excludes (i) properties that were acquired or sold during the
period from January 1, 2023 through May 22, 2024,
and (ii) properties acquired prior to January 1,
2023 that were or will be classified as
repositioning/redevelopment (current and future) or lease-up during
2023 and 2024 and select buildings in "Other Repositioning," which
we believe will significantly affect the properties' results during
the comparative periods. As of May 22, 2024, our 2024 Same
Property Portfolio consisted of buildings aggregating 36,993,292
rentable square feet at 293 of our properties.
Contact:
investorrelations@rexfordindustrial.com
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SOURCE Rexford Industrial Realty, Inc.