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Rexford (REXR) Boosts Portfolio, Buyouts Reach $1.6B in 2021

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Rexford Industrial Realty, Inc. REXR recently announced shelling out $141.4 million to acquire five industrial properties in the prime in-fill Southern California submarkets. With these buyouts, Rexford’s 2021 acquisition activity reached $1.6 billion. Also, more than $350 million of acquisitions are under contract or an accepted offer.

The abovementioned properties, acquired in November and December, were funded using cash on hand. These acquisitions are a strategic fit for Rexford as Southern California is considered to be a highly valued industrial property market, with supply constraints in the United States.

According to Howard Schwimmer and Michael Frankel, co-chief executive officers of Rexford, "These five investments, acquired through off-market transactions, reflect our ability to capitalize upon Rexford's deep, local sharp-shooter market knowledge and relationships, our value-add expertise and proprietary access to the infill Southern California market, the nation's strongest, most resilient and highest demand industrial market."

Rexford acquired 20481 Crescent Bay Drive in Lake Forest, within the Orange County — South submarket for $19.5 million. In Simi Valley, within the Ventura County submarket, the company took over 2280 Ward Avenue for $46.4 million. In City of Industry, CA, within the LA — San Gabriel Valley submarket, REXR purchased 334 El Encanto Road for $10.7 million.

Further, Rexford purchased 17031-17037 Green Drive in City of Industry, CA, within the LA — San Gabriel Valley submarket for $13.8 million and 13512 Marlay Avenue in Fontana, CA, within the Inland Empire — West submarket for $51.0 million.

Per CBRE Group CBRE, at the end of the third quarter of 2021, the vacancy rate was 2.2% in the 34-million-square-foot Orange County — South submarket and 0.9% in the 68-million-square-foot Ventura County submarket. Also, according to CBRE Group, the vacancy rate in the 159-million-square-foot LA — San Gabriel Valley submarket was 0.2% while 0.8% in the 319-million-square-foot Inland Empire — West submarket. This, in turn, reflected solid demand for industrial properties in these markets.

Demand for industrial real estate space has been shooting up amid an e-commerce boom, with growth in industries and companies making efforts to improve supply-chain efficiencies. Apart from the fast adoption of e-commerce, logistics real estate is anticipated to benefit from the likely rise in inventory levels over the long haul, thereby opening prospects for Rexford and other industrial REITs like Duke Realty Corp. DRE and Prologis PLD.

Rexford is poised to gain traction from its robust market fundamentals, with a low-leverage, fortress-like balance sheet and an impressive acquisition track record.

Shares of Zacks Rank #2 (Buy) REXR have surged 27.2% over the past three months, outperforming its industry’s rally of 5.2%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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Zacks Investment Research

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Prologis also holds a Zacks Rank of 2 at present. 2021 funds from operations (FFO) per share for Prologis will likely increase 8.4% year over year.

The Zacks Consensus Estimate for PLD’s 2021 FFO per share has been revised marginally upward in a month.

Duke Realty carries a Zacks Rank of 3 (Hold) at present. The long-term growth rate for Duke Realty is projected at 7.80%.

The Zacks Consensus Estimate for DRE’s 2021 FFO per share has been revised marginally upward in a month to $1.74.

The Zacks Consensus Estimate for CBRE Group’s ongoing-year earnings per share has moved 8.2% north to $5.30 over the past two months.

The Zacks Consensus Estimate for CBRE Group’s 2021 earnings per share suggests an increase of 62.1% year over year. Currently, CBRE sports a Zacks Rank of 1.


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Prologis, Inc. (PLD) : Free Stock Analysis Report

Duke Realty Corporation (DRE) : Free Stock Analysis Report

Rexford Industrial Realty, Inc. (REXR) : Free Stock Analysis Report

CBRE Group, Inc. (CBRE) : Free Stock Analysis Report

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