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Gladstone Commercial (GOOD) Extends Lease Period With Gaylord

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Shares of Gladstone Commercial Corporation (GOOD - Free Report) have moved up marginally following the announcement of the lease renewal of Syracuse, its New York-based industrial property, earlier this week. The 10-year lease extension with Gaylord Bros., Inc. through May 31, 2035, will help the REIT secure a steady cash flow from the property for a decent period.

The 71,880-square-foot building, fully occupied by Gaylord, was acquired by Gladstone Commercial in 2007. This is the third time that the lease got extended. This extension provides continued occupancy as well as increases the weighted average lease term of Gladstone Commercial’s portfolio.

Per Greg Yayac, senior asset manager of Gladstone Commercial, "This lease extension validates the suitability of our building for Gaylord's industrial use and our commitment to maintaining long term relationships with quality tenants."

The industrial asset class has been in the limelight for a while now for showing resilience despite the pandemic with low vacancy rates, high asking rents and robust rent collections. This has supported the financials of Gladstone Commercial along with other industrial REIT names like Prologis (PLD - Free Report) , Duke Realty Corp. (DRE - Free Report) and Terreno Realty Corporation (TRNO - Free Report) since last year.

Apart from the fast adoption of e-commerce, the industrial real estate space is anticipated to gain traction over the long run from a likely rise in the inventory levels of companies as a precaution for any supply-chain disruptions. This, in turn, might keep supporting the landlords like Gladstone Commercial, Prologis, Duke Realty and Terreno Realty to create a favorable market environment.

Gladstone Commercial’s rent collections also continue to bestrong. In its business update released earlier this month, the company noted that 100% of the October cash base rents were already paid and collected.

Also, recently, in an effort to expand its property base in the targeted thriving markets, Gladstone Commercial shelled out $12.8 million for the purchase of a 161,458-square-foot industrial facility in Monroe, NC.

Shares of Gladstone Commercial have gained 25.9% compared with the industry’s rally of 23.2% year to date.

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Currently, Gladstone Commercial carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.