U.S. Markets closed

Terreno Realty Buys Asset for $25M, Expands in New Jersey

Zacks Equity Research

Terreno Realty Corporation TRNO recently acquired an industrial property in Kearny, NJ. This acquisition comes as part of the company’s efforts to capitalize on robust fundamentals of the industrial real estate sector through purchase of potential properties in core markets.

Particularly, the buyout comprises 16.8-acre improved land parcel which is located at 81 North Hackensack Avenue. The property enjoys proximity to Exit 15E of the New Jersey Turnpike, U.S Routes 1 and 9, and the Pulaski Skyway. It is currently fully leased to one tenant. Also, its stabilized cap rate has been estimated at 5.3%, which highlights decent earning potential of the property.

Notably, the property has been purchased for roughly $25 million.  However, the acquisition marks as a partial payment of the $55-million senior secured loan made by Terreno Realty in 2018. The outstanding loan balance now stands at $30 million.

This apart, Terreno Realty acquired an industrial property located in Maspeth Queens, NY, for approximately $24 million, last month. Built on two acres of land, the property consists of one industrial trans-shipment building, spanning nearly 18,000 square feet of space. It is situated adjacent to the intersection of the Brooklyn-Queens Expressway and the Long Island Expressway.

Such strategic acquisitions are expected to help the company ride on its growth trajectory. Specifically the company targets functional buildings at in-fill locations which enjoy high-population densities and are located near high volume-distribution points. In fact, the company is focused 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, D.C. — that display solid demographic trends and experience healthy demand for industrial real estates.

Notably, high-consumer spending, e-commerce boom, as well as healthy manufacturing environment amid recovering economy have been fueling demand for the industrial real estate space. This upswing in demand will likely benefit Terreno Realty, as well as other industrial REITs like
Duke Realty Corp. DRE, Prologis PLD and Liberty Property Trust LPT. However, any protectionist trade policies might impede economic growth, as well as affect industrial REITs’ businesses.

Currently, Terreno Realty carries a Zacks Rank #2 (Buy). Its shares have gained 10.8% compared with the industry’s rise of 5.4%, over the past six months. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Zacks' Top 10 Stocks for 2019

In addition to the stocks discussed above, wouldn't you like to know about our 10 finest buy-and-holds for the year?

From more than 4,000 companies covered by the Zacks Rank, these 10 were picked by a process that consistently beats the market. Even during 2018 while the market dropped -5.2%, our Top 10s were up well into double-digits. And during bullish 2012 – 2017, they soared far above the market's +126.3%, reaching +181.9%.

This year, the portfolio features a player that thrives on volatility, an AI comer, and a dynamic tech company that helps doctors deliver better patient outcomes at lower costs.

See Stocks Today >>

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
Duke Realty Corporation (DRE) : Free Stock Analysis Report
Liberty Property Trust (LPT) : Free Stock Analysis Report
Terreno Realty Corporation (TRNO) : Free Stock Analysis Report
Prologis, Inc. (PLD) : Free Stock Analysis Report
To read this article on Zacks.com click here.
Zacks Investment Research