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Terreno Realty (TRNO) Boosts Growth With $6.5M Property Buyout
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Terreno Realty Corporation (TRNO - Free Report) recently purchased an industrial property comprising an industrial distribution building encompassing 16,000 square feet on 1.8 acres of land. The Bellevue, WA-based property was acquired for around $6.5 million. The move is in sync with the company’s efforts to bolster its acquisition-driven growth strategy.
The industrial real estate investment trust’s (REIT) newly acquired property is advantageously located at 13045 SE 32nd Street, adjacent to the intersection of I-90 and I-405 and is likely to lure tenants.
The building is equipped with three dock-high and two grade-level loading positions and provides parking space for 22 cars. At present, the property is vacant and has an estimated stabilized cap rate of 5.8%.
Terreno Realty is making concerted efforts to expand its asset base 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, to capitalize on the favorable fundamentals of the industrial real estate market.
Growth in industries and an expanding e-commerce market coupled with companies’ endeavors to improve supply-chain efficiencies have aided the need for industrial and logistics infrastructure and efficient distribution networks.
TRNO’s targeted markets are characterized by strong demand generators such as high population densities, high volume distribution points and logistics infrastructure, and low supply. It is also focused on investing in functional assets at in-fill locations. Such assets are located in areas surrounded by high concentrations of already-developed land and existing buildings. It allows the company to cater to submarket tenant demands, including last-mile distribution.
Notably, the company acquired properties worth $484 million from the beginning of 2023 through Oct 31, 2023.
Terreno Realty is also undertaking strategic dispositions to optimize its portfolio and enhance financial performance. Recently, it sold an industrial property consisting of an industrial distribution building covering 58,000 square feet on 3 acres of land in Compton, CA, for $15.9 million.
Such prudent capital management practices will enable the company to maintain balance sheet strength and facilitate long-term growth. As of Sep 30, 2023, TRNO had cash and cash equivalents of $96.2 million and no borrowings outstanding on the $400 million revolving credit facility.
Analysts seem bullish on this Zacks Rank #3 (Hold) company. The Zacks Consensus Estimate for its 2023 funds from operations (FFO) per share has been raised almost 1% in the past two months.
The stock has gained 7.8% in the past six months compared with the industry’s growth of 5.6%.
Image Source: Zacks Investment Research
Nonetheless, the stabilization of e-commerce sales growth and a high interest rate environment pose key concerns for Terreno Realty.
The Zacks Consensus Estimate for Rexford Industrial Realty’s 2023 FFO per share is pegged at $2.18, indicating a year-over-year increase of 11.2%.
The Zacks Consensus Estimate for Stag Industrial’s 2023 FFO per share stands at $2.28, suggesting year-over-year growth of 3.2%.
The Zacks Consensus Estimate for Park Hotels & Resorts’ 2023 FFO per share is pegged at $2.03, implying a year-over-year rise of 31.8%.
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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Terreno Realty (TRNO) Boosts Growth With $6.5M Property Buyout
Terreno Realty Corporation (TRNO - Free Report) recently purchased an industrial property comprising an industrial distribution building encompassing 16,000 square feet on 1.8 acres of land. The Bellevue, WA-based property was acquired for around $6.5 million. The move is in sync with the company’s efforts to bolster its acquisition-driven growth strategy.
The industrial real estate investment trust’s (REIT) newly acquired property is advantageously located at 13045 SE 32nd Street, adjacent to the intersection of I-90 and I-405 and is likely to lure tenants.
The building is equipped with three dock-high and two grade-level loading positions and provides parking space for 22 cars. At present, the property is vacant and has an estimated stabilized cap rate of 5.8%.
Terreno Realty is making concerted efforts to expand its asset base 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, to capitalize on the favorable fundamentals of the industrial real estate market.
Growth in industries and an expanding e-commerce market coupled with companies’ endeavors to improve supply-chain efficiencies have aided the need for industrial and logistics infrastructure and efficient distribution networks.
TRNO’s targeted markets are characterized by strong demand generators such as high population densities, high volume distribution points and logistics infrastructure, and low supply. It is also focused on investing in functional assets at in-fill locations. Such assets are located in areas surrounded by high concentrations of already-developed land and existing buildings. It allows the company to cater to submarket tenant demands, including last-mile distribution.
Notably, the company acquired properties worth $484 million from the beginning of 2023 through Oct 31, 2023.
Terreno Realty is also undertaking strategic dispositions to optimize its portfolio and enhance financial performance. Recently, it sold an industrial property consisting of an industrial distribution building covering 58,000 square feet on 3 acres of land in Compton, CA, for $15.9 million.
Such prudent capital management practices will enable the company to maintain balance sheet strength and facilitate long-term growth. As of Sep 30, 2023, TRNO had cash and cash equivalents of $96.2 million and no borrowings outstanding on the $400 million revolving credit facility.
Analysts seem bullish on this Zacks Rank #3 (Hold) company. The Zacks Consensus Estimate for its 2023 funds from operations (FFO) per share has been raised almost 1% in the past two months.
The stock has gained 7.8% in the past six months compared with the industry’s growth of 5.6%.
Image Source: Zacks Investment Research
Nonetheless, the stabilization of e-commerce sales growth and a high interest rate environment pose key concerns for Terreno Realty.
Stocks to Consider
Some better-ranked stocks from the REIT sector are Rexford Industrial Realty (REXR - Free Report) , Stag Industrial (STAG - Free Report) and Park Hotels & Resorts (PK - Free Report) . While PK sports a Zacks Rank #1 (Strong Buy) at present, REXR and STAG carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Rexford Industrial Realty’s 2023 FFO per share is pegged at $2.18, indicating a year-over-year increase of 11.2%.
The Zacks Consensus Estimate for Stag Industrial’s 2023 FFO per share stands at $2.28, suggesting year-over-year growth of 3.2%.
The Zacks Consensus Estimate for Park Hotels & Resorts’ 2023 FFO per share is pegged at $2.03, implying a year-over-year rise of 31.8%.
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.