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Terreno Realty (TRNO) Continues Buyout Spree With $17.9M Buyout
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Terreno Realty Corporation (TRNO - Free Report) is on an acquisition spree and recently announced shelling out $17.9 million for the buyout of an industrial property in Carlstadt, NJ. The latest buyout in Carlstadt comes after the company’s recent purchase of an industrial property in Hayward, CA for $8.3 million.
The Carlstadt property comprises a 4.9-acre improved land parcel at 245 Paterson Plank Road. It is next to the company’s Michele Place property and American Dream, the MetLife Sports Complex and Exit 16W of the New Jersey Turnpike, indicating an advantageous location and positioning it well to lure tenants. Currently, the property is vacant and its estimated stabilized cap rate is 4.5%.
The property in Hayward that the company recently purchased comprises two industrial distribution buildings containing roughly 41,000 square feet on 2.0 acres. With an advantageous location at 23482-23520 Foley Street, northwest of the intersection of I-880 and CA 92, the distribution buildings are anticipated to see solid demand and hence, the buyout seems a strategic fit. The estimated stabilized cap rate of the property is 4.9%.
The industrial real estate market is witnessing solid fundamentals as demand for the logistics infrastructure and efficient distribution networks has been shooting up amid an e-commerce boom, growth in industries and companies making efforts to improve supply-chain efficiencies. In addition to the fast adoption of e-commerce, the logistics real estate is anticipated to benefit from a likely increase in inventory levels post the global health crisis, offering scope to industrial landlords, including Terreno Realty, Duke Realty , Prologis (PLD - Free Report) and Rexford Industrial Realty, Inc. (REXR - Free Report) , among others, to enjoy a favorable market environment.
Amid this favorable environment, Terreno Realty is focused on expanding its portfolio on opportunistic acquisitions. It targets functional assets at in-fill locations, which enjoy high-population densities and are located near high-volume distribution points.
In addition to the above-mentioned acquisitions, the company has also acquired an industrial property recently in Orange, CA, for $9.3 million. Backed by such efforts, the company 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 estates.
In the past three months, shares of the company have gained 4.5% compared with its industry's rally of 4.6%.
Image Source: Zacks Investment Research
However, with the asset category being attractive in these challenging times, there is a development boom in a number of markets. This high supply is likely to intensify competition and curb pricing power.
Image: Bigstock
Terreno Realty (TRNO) Continues Buyout Spree With $17.9M Buyout
Terreno Realty Corporation (TRNO - Free Report) is on an acquisition spree and recently announced shelling out $17.9 million for the buyout of an industrial property in Carlstadt, NJ. The latest buyout in Carlstadt comes after the company’s recent purchase of an industrial property in Hayward, CA for $8.3 million.
The Carlstadt property comprises a 4.9-acre improved land parcel at 245 Paterson Plank Road. It is next to the company’s Michele Place property and American Dream, the MetLife Sports Complex and Exit 16W of the New Jersey Turnpike, indicating an advantageous location and positioning it well to lure tenants. Currently, the property is vacant and its estimated stabilized cap rate is 4.5%.
The property in Hayward that the company recently purchased comprises two industrial distribution buildings containing roughly 41,000 square feet on 2.0 acres. With an advantageous location at 23482-23520 Foley Street, northwest of the intersection of I-880 and CA 92, the distribution buildings are anticipated to see solid demand and hence, the buyout seems a strategic fit. The estimated stabilized cap rate of the property is 4.9%.
The industrial real estate market is witnessing solid fundamentals as demand for the logistics infrastructure and efficient distribution networks has been shooting up amid an e-commerce boom, growth in industries and companies making efforts to improve supply-chain efficiencies. In addition to the fast adoption of e-commerce, the logistics real estate is anticipated to benefit from a likely increase in inventory levels post the global health crisis, offering scope to industrial landlords, including Terreno Realty, Duke Realty , Prologis (PLD - Free Report) and Rexford Industrial Realty, Inc. (REXR - Free Report) , among others, to enjoy a favorable market environment.
Amid this favorable environment, Terreno Realty is focused on expanding its portfolio on opportunistic acquisitions. It targets functional assets at in-fill locations, which enjoy high-population densities and are located near high-volume distribution points.
In addition to the above-mentioned acquisitions, the company has also acquired an industrial property recently in Orange, CA, for $9.3 million. Backed by such efforts, the company 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 estates.
In the past three months, shares of the company have gained 4.5% compared with its industry's rally of 4.6%.
Image Source: Zacks Investment Research
However, with the asset category being attractive in these challenging times, there is a development boom in a number of markets. This high supply is likely to intensify competition and curb pricing power.
Terreno Realty currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.