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Terreno Realty Secures Early Lease Renewal, Witnesses Healthy Demand

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Key Takeaways

  • TRNO signed a 52,000 sq ft early lease renewal in Washington, D.C. with a wine and spirits distributor.
  • The REIT also renewed 35,000 sq ft and expanded 30,000 sq ft in Santa Clara with an eVTOL aircraft developer.
  • Q2 2025 new and renewed leases rents rose 22.6% with a 71.7% tenant retention rate in its operating portfolio.

Terreno Realty (TRNO - Free Report) recently announced the execution of a 52,000 square foot early lease renewal in Washington, D.C. The lessee of the agreement is a wine and spirits distributor. The renewal lease is set to commence on April 1, 2026 and is scheduled to expire in March 2031.

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 new and existing tenants.

Apart from the above lease, early last month, this real estate investment trust (REIT) announced the execution of a 35,000-square-foot renewal lease and a 30,000-square-foot expansion lease in Santa Clara, CA, with a designer and developer of eVTOL aircraft.

TRNO’s Q2 2025 Leasing Details

TRNO is experiencing healthy leasing activity, as evident in its performance in the second quarter of 2025. Its operating portfolio was 97.7% leased to 662 tenants as of June 30, 2025. TRNO’s same-store portfolio of 14.1 million square feet was 98.5% leased as of June 30, 2025. For the company’s improved land portfolio of 47 parcels spanning 150.6 acres, the leased rate was 95.1% as of June 30, 2025.

Terreno Realty was able to lock in higher rents on new and renewed leases during the quarter. Cash rents on new and renewed leases commencing during the second quarter of 2025 climbed 22.6%. 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 the company.

Over the past month, shares of this Zacks Rank #2 (Buy) company have dropped 6.5% compared with the industry’s decline of 3.1%.

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Other Stocks to Consider

Some other top-ranked stocks from the broader REIT sector are W.P. Carey (WPC - Free Report) and Host Hotels & Resorts (HST - Free Report) , each currently carrying a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

The Zacks Consensus Estimate for WPC’s 2025 FFO per share has moved one cent southward to $4.87 over the past month.

The consensus estimate for HST’s 2025 FFO per share has moved one cent northward to $1.95 over the past week.

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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