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Terreno Realty (TRNO) Sees Demand, Pre-leases Elizabeth Asset
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Terreno Realty (TRNO - Free Report) announced the pre-lease of a roughly 31,000-square-feet transshipment facility in Elizabeth, NJ, with a nationwide operator of container freight stations. The leasing will start subsequent to the January 2023 expiration of the current lease and expire in October 2027. The pre-leasing of the facility, which is on six acres, reflects the solid demand for the company’s properties.
This industrial REIT witnessed a rise in quarter-end occupancy and an increase in cash rents on new and renewed leases in the second quarter. For its operating portfolio, the occupancy reached 97.9% as of Jun 30, 2022, marking an expansion of 100 basis points (bps) from the prior quarter-end and 40 bps from the year-ago quarter-end. Moreover, its same-store portfolio was 98.0% leased on Jun 30, 2022.
In the second quarter, Terreno Realty was able to lock in higher rents on new and renewed leases, reflecting resilience in its portfolio. Cash rents on new and renewed leases (commenced during the second quarter) aggregating 0.5 million square feet and 7.2 acres of improved land grew 55.4%, with a tenant retention ratio of 27.5% for the operating portfolio and 100% for the improved land portfolio.
Amid an e-commerce boom, growth in industries and companies making efforts to improve supply-chain efficiencies, demand for industrial real estate space has been shooting up. TRNO is banking on such opportunities and is focused on expanding its portfolio through acquisitions. It is targeting functional assets at in-fill locations, which enjoy high-population densities and are located near high-volume distribution points.
In recent times, Terreno Realty shelled out $32.1 million to purchase an industrial property in Rancho Dominguez, CA. The estimated stabilized cap rate of the property is 5.5%. TRNO also acquired an industrial property in Hawthorne, CA, for $6.5 million.
From the beginning of the year through Jul 7, 2022, Terreno Realty acquired 13 properties comprising 14 buildings containing roughly 766,000 square feet and seven improved land parcels of around 27.4 acres for a total purchase price of $309.5 million.
Apart from the fast adoption of e-commerce, industrial real estate space is anticipated to gain traction over the long run from a likely rise in the inventory levels of companies as a precaution for any supply-chain disruption. This will offer opportunities to industrial landlords, including TRNO, Prologis (PLD - Free Report) and Rexford Industrial Realty (REXR - Free Report) , to enjoy a favorable market environment.
Prologis carries a Zacks Rank of 2 (Buy) at present. Prologis’ long-term growth rate is projected at 9.8%. The Zacks Consensus Estimate for PLD’s third-quarter 2022 funds from operations per share has been revised marginally upward in the past month.
Rexford Industrial Realty holds a Zacks Rank of 3 at present. Rexford Industrial Realty’s 2022 revenues are expected to increase 36.9% year over year. REXR’s long-term growth rate is projected at 11.3%.
Note: Anything related to earnings presented in this write-up represent funds from operations (FFO) — a widely used metric to gauge the performance of REITs.
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Terreno Realty (TRNO) Sees Demand, Pre-leases Elizabeth Asset
Terreno Realty (TRNO - Free Report) announced the pre-lease of a roughly 31,000-square-feet transshipment facility in Elizabeth, NJ, with a nationwide operator of container freight stations. The leasing will start subsequent to the January 2023 expiration of the current lease and expire in October 2027. The pre-leasing of the facility, which is on six acres, reflects the solid demand for the company’s properties.
This industrial REIT witnessed a rise in quarter-end occupancy and an increase in cash rents on new and renewed leases in the second quarter. For its operating portfolio, the occupancy reached 97.9% as of Jun 30, 2022, marking an expansion of 100 basis points (bps) from the prior quarter-end and 40 bps from the year-ago quarter-end. Moreover, its same-store portfolio was 98.0% leased on Jun 30, 2022.
In the second quarter, Terreno Realty was able to lock in higher rents on new and renewed leases, reflecting resilience in its portfolio. Cash rents on new and renewed leases (commenced during the second quarter) aggregating 0.5 million square feet and 7.2 acres of improved land grew 55.4%, with a tenant retention ratio of 27.5% for the operating portfolio and 100% for the improved land portfolio.
Amid an e-commerce boom, growth in industries and companies making efforts to improve supply-chain efficiencies, demand for industrial real estate space has been shooting up. TRNO is banking on such opportunities and is focused on expanding its portfolio through acquisitions. It is targeting functional assets at in-fill locations, which enjoy high-population densities and are located near high-volume distribution points.
In recent times, Terreno Realty shelled out $32.1 million to purchase an industrial property in Rancho Dominguez, CA. The estimated stabilized cap rate of the property is 5.5%. TRNO also acquired an industrial property in Hawthorne, CA, for $6.5 million.
From the beginning of the year through Jul 7, 2022, Terreno Realty acquired 13 properties comprising 14 buildings containing roughly 766,000 square feet and seven improved land parcels of around 27.4 acres for a total purchase price of $309.5 million.
Apart from the fast adoption of e-commerce, industrial real estate space is anticipated to gain traction over the long run from a likely rise in the inventory levels of companies as a precaution for any supply-chain disruption. This will offer opportunities to industrial landlords, including TRNO, Prologis (PLD - Free Report) and Rexford Industrial Realty (REXR - Free Report) , to enjoy a favorable market environment.
Shares of Zacks Rank #3 (Hold) Terreno Realty have climbed 12.4% quarter to date compared with the industry’s increase of 6.9%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Image Source: Zacks Investment Research
Prologis carries a Zacks Rank of 2 (Buy) at present. Prologis’ long-term growth rate is projected at 9.8%. The Zacks Consensus Estimate for PLD’s third-quarter 2022 funds from operations per share has been revised marginally upward in the past month.
Rexford Industrial Realty holds a Zacks Rank of 3 at present. Rexford Industrial Realty’s 2022 revenues are expected to increase 36.9% year over year. REXR’s long-term growth rate is projected at 11.3%.
Note: Anything related to earnings presented in this write-up represent funds from operations (FFO) — a widely used metric to gauge the performance of REITs.