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Terreno Realty Executes Lease in CA, Sees Healthy Demand

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Key Takeaways

  • TRNO signed a 103K sq ft lease in Redondo Beach, set to begin in stages from July to October 2025.
  • The lessee is a provider of in-space mobility; the lease runs through October 2035.
  • In Q1 2025, TRNO's cash rents on new and renewed leases surged 34.2% with a 71.7% retention ratio.

Terreno Realty (TRNO - Free Report) recently announced the execution of a 103,000 square feet lease in Redondo Beach, CA. The new lease is scheduled to commence in stages between July and October 2025, and slated for expiry in October 2035. The lessee of the agreement is a provider of in-space mobility.

TRNO, which acquires, owns and operates industrial real estate in six major coastal U.S. markets, has been experiencing healthy demand for its properties from both new and existing tenants.

Apart from the above lease, in May, this real estate investment trust (REIT) announced the execution of a new lease spanning a 3.0-acre improved land parcel in Rancho Dominguez, CA, with an environmental and regulated waste management services provider. In the same month, TRNO announced the execution of a lease renewal for 53,000 square feet with the United States Postal Service in Washington, D.C.

TRNO’s Q1 2025 Leasing Details

TRNO is experiencing healthy leasing activity, as evident in its performance in the first quarter of 2025. Its operating portfolio was 96.6% leased to 663 tenants as of March 31, 2025. TRNO’s same-store portfolio of 15.6 million square feet was 97.4% leased as of March 31, 2025. For the company’s improved land portfolio of 47 parcels spanning 150.6 acres, the leased rate was 95.1% as of March 31, 2025.

Terreno Realty was able to lock in higher rents on new and renewed leases during the quarter. The cash rents on new and renewed leases commencing during the first quarter of 2025 climbed 34.2%. Moreover, the tenant retention ratio was 71.7% for the operating portfolio.

TRNO: In a Nutshell

With a solid operating platform, a healthy balance sheet position and strategic expansion moves, TRNO seems well-positioned to capitalize on long-term growth opportunities. However, amid macroeconomic uncertainty and geopolitical issues, customers remain focused on cost controls and delay their decision-making with respect to leasing. This is a concern for TRNO.

In the past month, shares of this Zacks Rank #3 (Hold) company have lost 0.2% against the industry’s growth of 0.4%. Analysts seem bearish on the stock with its 2025 funds from operations (FFO) per share revised marginally southward to $2.61 over the past two months.

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Stocks to Consider

Some better-ranked stocks from the broader REIT sector are VICI Properties (VICI - Free Report) and W.P. Carey (WPC - Free Report) , each carrying a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

The Zacks Consensus Estimate for VICI’s 2025 FFO per share is pinned at $2.35, implying year-over-year growth of 4%.

The Zacks Consensus Estimate for WPC’s 2025 FFO per share is pegged at $4.88, indicating an increase of 3.8% from the year-ago reported figure.

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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