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Terreno Realty (TRNO) Acquires Redmond Property, Stock Rises

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Shares of Terreno Realty Corporation (TRNO - Free Report) have rallied more than 3% during the last two trading sessions. This industrial REIT is on a buyout spree and recently acquired an industrial property in Redmond, WA for $3.5 million. The move comes as part of its acquisition-driven growth strategy.

This latest acquisition comes after the company shelled out $33.5 million to purchase an industrial property in Woodinville, WA and expended $74.1 million net of free-rent credits to acquire an industrial property in Hialeah, FL.

The Redmond property, 100% leased to one tenant on a short-term basis, is a 0.8-acre improved land parcel at 9045 Willows Road. It is between I-405 and SR 520, representing an advantageous location and positioning it well to lure tenants. The estimated stabilized cap rate of the property is 4.9%.

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

Terreno Realty’s latest spate of acquisitions also include purchasing an industrial property in Bladensburg, MD for $11.9 million and shelling of $60.8 million to acquire an industrial property at 5150-5236 Eisenhower Avenue, inside the Capital Beltway in Alexandria, VA.

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.

Apart from the fast adoption of e-commerce, industrial real estate is anticipated to benefit from an increase in inventory levels post the global health crisis, offering scope to industrial landlords, including Terreno Realty, Prologis (PLD - Free Report) , Duke Realty and Rexford Industrial Realty (REXR - Free Report) , to enjoy a favorable market environment.

Terreno Realty currently carries a Zacks Rank #2 (Buy). In the past three months, TRNO’s shares have rallied 34.4% compared with the industry’s growth of 14.5%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Zacks Investment ResearchImage Source: Zacks Investment Research

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.

Duke Realty carries a Zacks Rank of 3 (Hold) at present. The long-term growth rate for Duke Realty is projected at 7.80%.

The Zacks Consensus Estimate for DRE’s 2021 FFO per share has been revised marginally upward in two months to $1.74.

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.


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