LOS ANGELES — 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 throughout infill Southern California, today announced investment activity of $245.0 million that was funded using proceeds from forward equity settlements and cash on hand.
“These investments demonstrate Rexford Industrial’s ability to leverage our deep, proprietary access to significant value-creation opportunities within our target infill Southern California industrial property markets,” stated Howard Schwimmer and Michael Frankel, Co-Chief Executive Officers of the Company. “The Company continues to capitalize upon dynamic market conditions to generate accretive FFO per share and net asset value growth through our value-add investment program. In addition to the $1.4 billion of investments completed year-to-date, the Company currently has a near-term pipeline comprising approximately $100 million of new investments under contract or accepted offer. Rexford Industrial remains well-positioned with a low-leverage, best-in-class balance sheet, providing the Company protection from general economic uncertainty while also enabling the Company to opportunistically capitalize upon accretive internal and external growth opportunities that drive long-term stakeholder value.”
The Company acquired the fee simple interest in a 100% leased property at 15801 West 1st Street, Irwindale, located in the LA – San Gabriel Valley submarket, through an off-market transaction, for $120.0 million, $121 per building square foot or $37 per land square foot. The 993,142 square foot facility, situated on a 75-acre industrially zoned site, is located within the high-demand City of Irwindale and provides high-visibility freeway frontage on the heavily trafficked I-210 freeway. The property is leased to a deeply entrenched tenant with an eight-year lease term subject to long-term extension options. The investment provides favorable cash flow with an initial 5.6% unlevered cash yield, growing by annual contractual rent increases, plus the potential future value-add opportunity to redevelop the site into a modern, state-of-the-art industrial campus following lease expiration. In conjunction with the acquisition, the Company issued a $125.0 million loan to the seller securitized by an adjacent 150-acre industrial development site. The five-year, fixed rate loan has an effective interest rate of 8.0% and includes a right of first offer for the Company to acquire the underlying industrial development site in the future. The combined $245.0 million investment comprising the aforementioned fee simple interest and loan is projected to generate an aggregate 6.8% initial unlevered stabilized cash yield. According to CBRE, the vacancy rate in the 161 million square foot LA – San Gabriel Valley submarket was 1.5% at the end of the third quarter 2023.
About Rexford Industrial
Rexford Industrial creates value by investing in, operating and redeveloping industrial properties throughout infill Southern California, the world’s fourth largest industrial market and consistently the highest-demand, lowest supply market in the nation. 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, irreplaceable portfolio comprises 372 properties with approximately 46.0 million rentable 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 ticker “REXR,” Rexford Industrial is an S&P MidCap 400 Index member.
