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Terreno Realty (TRNO) Buys Woodinville Asset, Expands Portfolio

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Terreno Realty Corporation (TRNO - Free Report) is on a buyout spree. It recently acquired an industrial property in Woodinville, WA for $33.5 million. This latest acquisition comes after the company shelled out $74.1 million net of free-rent credits to purchase an industrial property in Hialeah, FL.

The Woodinville property, 100% leased to four tenants, comprises two industrial distribution buildings. It encompasses roughly 118,000 square feet on 9.6 acres at 16650-16750 Woodinville Redmond Road.

It is adjacent to Terreno Realty’s property at 16224-16240 Woodinville Redmond Road, southeast of the intersection of I-405 and SR 522. It offers 27 dock-high and eight grade-level loading positions as well as parking for 291 cars. This represents an advantageous location and positions it well to lure tenants. The estimated stabilized cap rate of the property is 3.7%.

Amid an e-commerce boom, with growth in industries and companies making efforts to improve supply-chain efficiencies, demand for industrial real estate space has been shooting up. Hence, Terreno Realty is banking on such opportunities and is focused on expanding its portfolio on acquisitions. It is targeting functional assets at in-fill locations, which enjoy high-population densities and are located near the high-volume distribution points.

Recently, Terreno Realty acquired an industrial property in Bladensburg, MD for $11.9 million. The company also shelled out $60.8 million to purchase an industrial property at 5150-5236 Eisenhower Avenue, inside the Capital Beltway in Alexandria, VA. Further, TRNO acquired an industrial property in Rancho Dominguez, CA for $13.8 million.

With such expansion efforts, Terreno Realty is 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, TRNO’s shares have rallied 29% compared with the industry’s increase of 9.9%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Zacks Investment ResearchImage Source: Zacks Investment Research

Other Key Picks

Some other key picks from the REIT sector include Prologis (PLD - Free Report) , Extra Space Storage Inc. (EXR - Free Report) and Rexford Industrial Realty (REXR - Free Report) .

Prologis carries a Zacks Rank of 2 at present. Prologis’ 2021 FFO per share is expected to increase 8.4% year over year.

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

Extra Space Storage holds a Zacks Rank of 2 at present. 2021 FFO per share for Extra Space Storage is expected to increase 29.9% year over year.

The Zacks Consensus Estimate for EXR’s 2021 FFO per share has been revised 2.1% upward in a month.

The Zacks Consensus Estimate for Rexford Industrial’s ongoing-year FFO per share has moved 1.2% north to $1.63 over the past two months.

The Zacks Consensus Estimate for Rexford Industrial’s 2021 FFO per share 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.