Rexford Industrial Announces $164 Million Acquisitions
– Acquire four properties for $164 million in Southern California Prime Infill Submarkets –
– Investments since the beginning of the year totaling $774 million –
LOS ANGELES, June 1, 2022 /PRNewswire/ — Rexford Industrial Realty, Inc. (the “Company” or “Rexford Industrial”) (NYSE: REXR), a real estate investment trust focused on creating value by investing in and operating industrial properties located in throughout Southern California, today announced the acquisition of four industrial properties for an aggregate purchase price of $163.8 million. The purchases were financed using a combination of cash on hand, the Company’s line of credit and units in the Company’s operating partnership (“OP Units”).
“These investments, acquired through off-market transactions, reflect our team’s ability to leverage its regional sniper advantage and value-added expertise within the infill. Southern California, the least supplied and most demanded industrial market in the country. Our exclusive market access positions the company to generate favorable cash flow growth as we capitalize on our information advantage to grow accretively beyond our current portfolio comprising 39 million square feet of industrial properties , representing a 2% market share,” said Howard Schwimmer and Michael Frankel, co-Chief Executive Officers of the Company. “Our year-to-date investments total $774 million, of which over 85% has been acquired through off-market or lightly traded transactions. With over $600 million of additional investments contracted or offered accepted, as well as a broad range of value-added organic growth initiatives underway, we are well positioned with a low-leverage balance sheet to generate superior long-term shareholder value.”
In May and June, through off-market transactions, the Company acquired:
- 2020 Avenue du Centre-Sud, Comptonlocated in the LA – south bay submarket for $10.8 millionWhere $110 per square foot of land. The 2.3 acre industrial zone lot includes a fully occupied 30,233 square foot single-tenant building, leased at an estimated rent approximately 60% below current market rates. When the lease expires, the Company plans to redevelop the site by constructing a 45,000 square foot Class A industrial building. The initial unleveraged cash return of 3.5% is expected to reach a stabilized unleveraged cash return on the total investment of 5.5%. According to CBRE, the vacancy rate in the 219 million square feet LA – south bay submarket was 0.6% at the end of the first quarter of 2022.
- 14200-14220 Arminta St., panoramic citylocated in the LA–San Fernando Valley submarket for $90.2 millionWhere $451 per square foot. The 200,000 square foot Class A building on 8.5 acres is leased long term to a creditor tenant at an estimated rent approximately 35% below current market rates. The investment generates an initial unleveraged cash return of 2.8% on the total investment, increasing over time by 3.25% annual contractual rent increases. The purchase was made using $24.5 million of cash and 954,000 OP Units with a value of $68.84 per unit, which are redeemable by the seller on a one-for-one basis for publicly traded common shares of the Company. According to CBRE, the vacancy rate in the 181 million square feet LA – St. Fernando submarket was 0.5% at the end of the first quarter of 2022.
- 1172 Holt Blvd. Ontariolocated in the Inland Empire – West submarket for $17.8 millionWhere $404 per square foot. The 44,000 square foot Class A building was constructed in 2021 and is located on 2.1 acres of land adjacent to the company’s recently purchased 1154 Holt Boulevard site. The building is leased to a single tenant at an estimated rent approximately 35% below current market rental rates. Upon lease expiration, the Company intends to generate accretive cash flow growth by re-letting at market rates. The investment generates an initial unleveraged cash return of 2.5% which is expected to reach a stabilized unleveraged cash return on the total investment of 4.1%. According to CBRE, the vacancy rate in the 321 million square foot Inland Empire – West submarket was 0.1% at the end of the first quarter of 2022.
- 1500 Raymond Avenue South, Fullertonlocated inside the Northern Orange County submarket for $45.0 millionWhere $143 per square foot of land. The 7.2 acre industrial zoned site contains a recently closed hotel that will be redeveloped into a Class A warehouse totaling approximately 138,500 square feet with excess land for trailer/outdoor storage. High visibility property has highway frontage with immediate on-ramp access. The investment is expected to generate an unleveraged cash return of 4.8% on the total investment upon stabilization. According to CBRE, the vacancy rate in the 115 million square feet Northern Orange County submarket was 0.9% at the end of the first quarter of 2022.
About Rexford Industrial
Rexford Industrial creates value by investing, operating and redeveloping industrial properties throughout the infill Southern California, the fourth largest industrial market in the world and still the market with the highest demand and lowest supply in the country. The Company’s highly differentiated strategy enables internal and external growth opportunities through its proprietary value creation and asset management capabilities. Rexford Industrial’s high-quality and irreplaceable portfolio includes 322 properties with approximately 38.8 million habitable square feet occupied by a stable and diverse tenant base. Structured as a real estate investment trust (REIT) listed on the New York Stock Exchange under the symbol “REXR”, Rexford Industrial is a member of the S&P MidCap 400 Index. For more information, please visit www.rexfordindustrial.com.
This press release may contain forward-looking statements within the meaning of the federal securities laws, which are based on current expectations, forecasts and assumptions that involve risks and uncertainties that could cause actual results to differ materially. Forward-looking statements relate to expectations, beliefs, projections, future plans and strategies, anticipated events or trends, and similar expressions regarding matters that are not historical facts. In some cases, you can identify forward-looking statements by using forward-looking words such as “may”, “will”, “should”, “expect”, “intend”, “anticipate”, “anticipate ‘, ‘believes’, ‘estimates’, ‘predicts’ or ‘potential’ or the negative form of such words and phrases or similar words or phrases which are predictions or indicate future events or trends and which do not relate solely to historical matters. Although forward-looking statements reflect the company’s good faith beliefs, assumptions and expectations, they are not guarantees of future performance. For further discussion of these and other factors that may that the Company’s future results will differ materially from any forward-looking statements, see the reports and other documents filed by the Company with the United States Securities and Exchange Commission, including the annual report of the Corporation on Form 10-K for the year ended the 31st of December, 2021, and the most recent Form 10-Q. The Company disclaims any obligation to publicly update or revise any forward-looking statements to reflect changes in underlying assumptions or factors, new information, data or methods, future events or other changes.
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