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Terreno Carries Out Lease Renewal for San Leandro Property

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Terreno Realty Corporation (TRNO - Free Report) has been experiencing a decent demand for its properties from both existing and new tenants. The company recently carried out a lease renewal for a global aerospace and defense technology company for 147,898 square feet of space in San Leandro, CA. The renewed lease will expire on Dec 31, 2024.

As of Sep 30, 2019, the company’s operating portfolio was 97.2% leased to 497 tenants. Cash rents on new and renewed leases, aggregating approximately 1.8 million square feet, and beginning in the first nine months of 2019, increased 17.9%, reflecting the strong demand for its properties.

Admittedly, amid the e-commerce boom, resilient consumer sentiment, low unemployment level and rising wages, demand for industrial real estate remains robust. Companies are making immense efforts to improve supply-chain efficiencies, spurring demand for logistics infrastructure and efficient distribution networks.

As a result, Terreno Realty and other industrial REITs like Duke Realty Corp. , Prologis (PLD - Free Report) and Rexford Industrial Realty, Inc. (REXR - Free Report) are making concerted efforts to tap such opportunities.

Particularly, Terreno Realty is focusing on fortifying its portfolio in six major port cities — Los Angeles, Northern New Jersey/New York City, San Francisco Bay Area, Seattle, Miami and Washington, DC. This is because these regions are witnessing solid demographic trends and healthy demand for industrial real estates.

Furthermore, the company is aiming for growth on the back of strategic acquisitions. It intends to acquire properties at in-fill locations with high-population densities, located near high volume-distribution points. In the first nine months of 2019, Terreno Realty acquired 10 industrial properties, comprising 15 buildings and spanning around 608,000 square feet, as well as three improved land parcels of about 21.7 acres.

The company is also divesting its non-core properties to fund its acquisitions and improve the quality of its portfolio. During the first three quarters of 2019, Terreno Realty sold two properties spanning nearly 197,000 square feet. Such efforts will help the company to benefit from the robust fundamentals of the industrial real estate sector.

Currently, Terreno Realty carries a Zacks Rank #3 (Hold). Its shares have gained 12.5% against the industry’s decline of 3.9% over the past three months. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.



 

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