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Terreno Realty (TRNO) Buys Los Angeles Asset, Expands Portfolio

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Terreno Realty Corporation TRNO recently shelled out $7.7 million to purchase an industrial property in Los Angeles, CA, as part of its acquisition-driven growth strategy.

The Los Angeles property is at 768 and 772 Ceres Avenue in Downtown Los Angeles, an advantageous location to lure the tenants. It comprises two industrial distribution buildings encompassing around 17,000 square feet on 0.4 acres. The property, fully leased to two tenants, is expiring in February 2023 and July 2024. The estimated stabilized cap rate of the property is 3.4%.

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, aiding the industrial REITs, including Terreno Realty, Prologis PLD, Duke Realty Corp. DRE and Rexford Industrial Realty, Inc. REXR.

Apart from the fast adoption of e-commerce, logistics real estate is poised to benefit from an increase in the inventory levels post the global health crisis, opening up possibilities for Prologis, Duke Realty, Rexford Industrial Realty and Terreno Realty Corporation to enjoy a favorable market environment.

Terreno Realty banks on such scopes and is focused on expanding its portfolio on acquisitions. It targets the functional assets at the in-fill locations, which enjoy high-population densities and are located near the high-volume distribution points.

Terreno Realty shelled out $167 million in acquisitions in the third quarter and $444.1 million since the beginning of the year through Nov 2, 2021.

Due to these efforts, TRNO is well poised to enhance its portfolio in the six major coastal U.S. markets — Los Angeles, Northern New Jersey/New York City, San Francisco Bay Area, Seattle, Miami and Washington, DC — which display solid demographic trends and witness healthy demand for industrial real estate.

Terreno Realty currently carries a Zacks Rank #2 (Buy). In the past three months, the company’s shares have gained 16.9% compared with the industry’s increase of 1.5%.You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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Prologis holds a Zacks Rank of 3 (Hold), at present. Its 2021 FFO per share is expected to increase 8.2% year over year.

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

Duke Realty holds a Zacks Rank of 3, at present. Its long-term growth rate is projected at 7.90%.

The Zacks Consensus Estimate for DRE’s 2021 FFO per share has been revised marginally upward in a month to $1.73.

The Zacks Consensus Estimate for Rexford Industrial’s ongoing-year FFO per share has moved 4.5% north to $1.63 over the past month.

Rexford Industrial’s 2021 FFO per share estimate suggests an increase of 23.5% year over year. Currently, REXR carries a Zacks Rank of 2.

Note: Anything related to earnings presented in this write-up represents funds from operations (FFO) — a widely used metric to gauge the performance of REITs.


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

Duke Realty Corporation (DRE) : Free Stock Analysis Report

Terreno Realty Corporation (TRNO) : Free Stock Analysis Report

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

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