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DCT Industrial Buys Land in Chicago

Zacks Equity Research

DCT Industrial Trust Inc., (DCT) recently announced the acquisition of a 32.6 acre land parcel in the I-55 industrial submarket of Romeoville, Chicago. Scheduled to be completed in fourth quarter 2012, the project will complement DCT Industrial’s Chicago portfolio of 5.6 million square feet. Following this acquisition, the company intends to start the construction of a 604,000 square foot DCT Boldt Park, a cross-dock facility in May 2012.

The newly acquired land will be beneficial for the company as the I-55 submarket is one of the most important distribution areas in Chicago. The building's modern and sustainable design is also expected to attract strong tenant activity in future.

DCT Industrial reported fourth quarter 2011 FFO (funds from operations) of $30.0 million or 11 cents per share, compared with $23.9 million or 10 cents per share in the year-earlier quarter. Fund from operations, a widely used metric to gauge the performance of REITs, is obtained after adding depreciation and amortization as well as other non-cash expenses to the net income.

DCT Industrial is a leading industrial real estate company that owns, operates and develops high-quality bulk distribution and light industrial properties in high-volume distribution markets in the U.S. and Mexico. 

As of December 30, 2011, the company owned interests in, managed or had under development approximately 75.5 million square feet of properties, which have been leased to more than 860 customers. This includes 13.3 million square feet of properties managed on behalf of three institutional joint venture partners.

DCT Industrial currently retains a Zacks #2 Rank, which translates into a short-term Buy rating. We are also maintaining our long-term Neutral recommendation on the stock. One of its competitors, Duke Realty Corp (DRE) holds a Zacks #3 Rank, which translates into a short-term Hold rating.

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