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Plymouth (PLYM) Drives Growth With Solid Leasing Activity in Q4
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Plymouth Industrial REIT (PLYM - Free Report) continues to showcase its resilience and growth potential in the industrial real estate market, as evidenced by its leasing and development activity in the fourth quarter of 2023. With a commitment to providing cost-effective, functional, flexible and safe industrial spaces, Plymouth Industrial REIT has not only maintained high occupancy rates but also embarked on a strategic path toward sustained profitability.
Leases commencing during the fourth quarter totaled 966,167 square feet, all with terms of at least six months. This healthy leasing activity consisted of both renewal and new leases, with 664,157 square feet associated with renewals and 302,010 square feet of new leases. PLYM anticipates a 23.4% increase in rental rates on a cash basis from these leases, contributing to its strong performance.
As of Dec 31, 2023, the company's portfolio occupancy stood at an impressive 98.3%, reflecting recent new developments now in service. Furthermore, same-store occupancy as of the same date was 98.6%, demonstrating Plymouth's proficiency in tenant retention and property management.
PLYM’s executed leases commenced during 2023 included 3,945,024 square feet of renewal leases and 1,654,919 square feet of new leases, of which 109,098 square feet were vacant at the start of 2023.
The company has already executed leases covering 41.4% of its total 2024 expirations, with a 14.6% increase in rental rates on a cash basis, illustrating management's proactive approach to securing future revenue streams.
Plymouth's development initiatives are equally noteworthy. In the fourth quarter, PLYM successfully delivered a fully leased industrial building in Jacksonville, aggregating 39,750 square feet of space. The final project in the first stage of its development program, a fully leased 52,920-square-foot building in Jacksonville, is anticipated to be operational in the third quarter of this year.
Furthermore, the company inked a seven-year, 108,000-square-foot lease at its 180,000-square-foot industrial building in Atlanta, achieving full occupancy for this new development. These developments signify Plymouth Industrial REIT's commitment to expanding its footprint and providing high-quality spaces tailored to the evolving needs of its tenants.
Plymouth’s co-founder and chief executive officer, Jeff Witherell, pointed out the new opportunities being created by the Golden Triangle. According to him, “The ability to capture strong returns with $37 million of select dispositions accelerated our plans to reduce debt in 2023 and should allow us to redeploy capital within the Golden Triangle.”
Meanwhile, during the fourth quarter, PLYM concluded the prior announced sale of its 156,634-square-foot industrial building in Marlton, NJ, for $16.8 million, yielding a 6.3% cap rate on in-place net operating income and an IRR of 18.2% over a nine-year hold.
The company's upcoming fourth-quarter earnings release on Feb 22, 2024, before market open, and a conference call later that day, is an event investors should keep an eye on for further insights into its financial performance and strategic outlook.
Amid an e-commerce boom, growth in industries and companies making efforts to improve supply-chain efficiencies, the demand for industrial real estate space has been shooting up. Apart from the fast adoption of e-commerce, the industrial real estate space is poised to gain traction over the long run from a likely rise in the inventory levels of companies as a precaution for any supply-chain disruption. This will offer opportunities to industrial landlords, including Plymouth, Rexford Industrial Realty (REXR - Free Report) and First Industrial Realty Trust (FR - Free Report) , to enjoy a favorable market environment.
Plymouth, with its strong leasing activity and strategically planned development program, is well-positioned to benefit from these market trends. The company's impressive leasing results, including strong renewal rates and new leases, highlight its ability to attract and retain tenants. The anticipated rental rate increases demonstrate the financial growth potential of PLYM. Additionally, ongoing development projects contribute to portfolio expansion and provide avenues for future revenue generation.
Shares of Plymouth, currently carrying a Zacks Rank #3 (Hold), have risen 13.1% in the past three months compared with the industry’s increase of 19.8%.
Image Source: Zacks Investment Research
First Industrial Realty carries a Zacks Rank of 2 (Buy) at present. The Zacks Consensus Estimate for First Industrial Realty’s 2023 FFO per share of $2.43 suggests a 6.6% increase year over year. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Rexford Industrial Realty has a Zacks Rank of 2. The Zacks Consensus Estimate for REXR’s 2023 FFO per share of $2.18 calls for an 11.2% increase year over year.
Note: Anything related to earnings presented in this write-up represent funds from operations (FFO) — a widely used metric to gauge the performance of REITs.
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Plymouth (PLYM) Drives Growth With Solid Leasing Activity in Q4
Plymouth Industrial REIT (PLYM - Free Report) continues to showcase its resilience and growth potential in the industrial real estate market, as evidenced by its leasing and development activity in the fourth quarter of 2023. With a commitment to providing cost-effective, functional, flexible and safe industrial spaces, Plymouth Industrial REIT has not only maintained high occupancy rates but also embarked on a strategic path toward sustained profitability.
Leases commencing during the fourth quarter totaled 966,167 square feet, all with terms of at least six months. This healthy leasing activity consisted of both renewal and new leases, with 664,157 square feet associated with renewals and 302,010 square feet of new leases. PLYM anticipates a 23.4% increase in rental rates on a cash basis from these leases, contributing to its strong performance.
As of Dec 31, 2023, the company's portfolio occupancy stood at an impressive 98.3%, reflecting recent new developments now in service. Furthermore, same-store occupancy as of the same date was 98.6%, demonstrating Plymouth's proficiency in tenant retention and property management.
PLYM’s executed leases commenced during 2023 included 3,945,024 square feet of renewal leases and 1,654,919 square feet of new leases, of which 109,098 square feet were vacant at the start of 2023.
The company has already executed leases covering 41.4% of its total 2024 expirations, with a 14.6% increase in rental rates on a cash basis, illustrating management's proactive approach to securing future revenue streams.
Plymouth's development initiatives are equally noteworthy. In the fourth quarter, PLYM successfully delivered a fully leased industrial building in Jacksonville, aggregating 39,750 square feet of space. The final project in the first stage of its development program, a fully leased 52,920-square-foot building in Jacksonville, is anticipated to be operational in the third quarter of this year.
Furthermore, the company inked a seven-year, 108,000-square-foot lease at its 180,000-square-foot industrial building in Atlanta, achieving full occupancy for this new development. These developments signify Plymouth Industrial REIT's commitment to expanding its footprint and providing high-quality spaces tailored to the evolving needs of its tenants.
Plymouth’s co-founder and chief executive officer, Jeff Witherell, pointed out the new opportunities being created by the Golden Triangle. According to him, “The ability to capture strong returns with $37 million of select dispositions accelerated our plans to reduce debt in 2023 and should allow us to redeploy capital within the Golden Triangle.”
Meanwhile, during the fourth quarter, PLYM concluded the prior announced sale of its 156,634-square-foot industrial building in Marlton, NJ, for $16.8 million, yielding a 6.3% cap rate on in-place net operating income and an IRR of 18.2% over a nine-year hold.
The company's upcoming fourth-quarter earnings release on Feb 22, 2024, before market open, and a conference call later that day, is an event investors should keep an eye on for further insights into its financial performance and strategic outlook.
Amid an e-commerce boom, growth in industries and companies making efforts to improve supply-chain efficiencies, the demand for industrial real estate space has been shooting up. Apart from the fast adoption of e-commerce, the industrial real estate space is poised to gain traction over the long run from a likely rise in the inventory levels of companies as a precaution for any supply-chain disruption. This will offer opportunities to industrial landlords, including Plymouth, Rexford Industrial Realty (REXR - Free Report) and First Industrial Realty Trust (FR - Free Report) , to enjoy a favorable market environment.
Plymouth, with its strong leasing activity and strategically planned development program, is well-positioned to benefit from these market trends. The company's impressive leasing results, including strong renewal rates and new leases, highlight its ability to attract and retain tenants. The anticipated rental rate increases demonstrate the financial growth potential of PLYM. Additionally, ongoing development projects contribute to portfolio expansion and provide avenues for future revenue generation.
Shares of Plymouth, currently carrying a Zacks Rank #3 (Hold), have risen 13.1% in the past three months compared with the industry’s increase of 19.8%.
Image Source: Zacks Investment Research
First Industrial Realty carries a Zacks Rank of 2 (Buy) at present. The Zacks Consensus Estimate for First Industrial Realty’s 2023 FFO per share of $2.43 suggests a 6.6% increase year over year. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Rexford Industrial Realty has a Zacks Rank of 2. The Zacks Consensus Estimate for REXR’s 2023 FFO per share of $2.18 calls for an 11.2% increase year over year.
Note: Anything related to earnings presented in this write-up represent funds from operations (FFO) — a widely used metric to gauge the performance of REITs.