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January 18, 2022
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Rexford Industrial Realty Rings in the New Year with $270 Mil of End-of-Year Purchases

1/05/22

Rexford Industrial Realty closed out 2021 with the acquisition of eight industrial properties for an aggregate purchase price of $270 mil. The acquisitions were funded using cash on hand and proceeds from forward equity settlements.

For the full year 2021, the company acquired $1.9 bil of industrial properties, bringing the Company's total portfolio to 296 properties comprising approximately 37.1 msf within prime infill Southern California "last-mile" submarkets.

In December, through off-market and lightly marketed transactions, Rexford acquired:

A property located in the western portion of the City of Industry, within the LA San Gabriel Valley submarket -- for $28.6 mil, or $86 per land square foot. The 7.6-acre site contains a single-tenant, 111.9k sf building acquired through a multi-year sale-leaseback. Upon lease expiration, the company intends to execute a redevelopment of the site. The initial 3.5% unlevered cash yield is projected to grow to a stabilized unlevered cash yield on total investment of approximately 5.0%. According to CBRE, the vacancy rate in the 159 msf San Gabriel Valley submarket was 0.2% at the end of the third quarter 2021.

2391-2393 Bateman Ave, located in Irwindale, within the LA San Gabriel Valley submarket -- for $23.1 mil, or $352 per square foot. The 65.6k sf, single-tenant Class A industrial facility is situated on 3.4 acres of land. The property is subject to a long-term sale leaseback with an initial unlevered cash yield on total investment of 4.0%, with contractual 3.0% annual rent increases through the lease term.

1020 Bixby Drive, located in the City of Industry, within the LA San Gabriel Valley submarket -- for $16.4 mil, or $287 per square foot. The 56.9k sf warehouse building is fully leased at a rental rate estimated to be approximately 30% below market rates. Upon lease expiration, the company intends to drive cash flow growth through either value-add repositioning and re-tenanting or through lease renewal at market rent. The initial 3.6% unlevered cash yield is projected to grow to a stabilized unlevered cash yield on total investment of 4.5%.

2800 Casitas Ave, located in Los Angeles, within the LA Greater San Fernando Valley submarket -- for $43.0 mil, or $368 per square foot. The 5.7-acre site contains a 117k sf, two-tenant industrial building leased at rental rates estimated to be approximately 60% below market rates. Upon near-term lease expiration, the company intends to perform value-add repositioning, upgrading the building to a state-of-the-art last-mile warehouse/distribution facility. The investment is projected to generate a 4.5% stabilized unlevered cash yield on total investment. According to CBRE, the vacancy rate in the 180 msf Greater San Fernando Valley submarket was 1.1% at the end of the third quarter 2021.

4240 W. 190th St, located in Torrance, within the LA South Bay submarket -- for $75.3 mil, or $149 per land square foot. The fully leased, 307k sf, two-tenant industrial building is currently leased at rental rates estimated to be 40% below market rates. Upon lease expiration, the company plans to redevelop the 11.6-acre site into a best-in-class, single-tenant logistics facility. The initial 3.0% unlevered cash yield is projected to grow to a stabilized unlevered cash yield on total investment of 5.1%. According to CBRE, the vacancy rate in the 218 msf LA - South Bay submarket was 0.6% at the end of the third quarter 2021.

8911 Aviation Blvd, located in Inglewood, within the LA South Bay submarket -- for $32.0 mil, or $183 per land square foot. The four-acre covered land site contains 100k sf of buildings, leased to a single tenant located immediately adjacent to the Los Angeles International Airport. Following the expiration of the current long-term lease, the company intends to redevelop the site by constructing two new, best-in-class logistics buildings. The initial unlevered cash yield is 4.7%.

3071 E. Coronado St, located in Anaheim, within the Orange County North submarket -- for $28.0 mil, or $131 per land square foot. The 4.9-acre land site will be immediately redeveloped by constructing a new 106.9k sf building featuring 36' clear height. Upon lease-up, the investment is projected to generate a 4.7% stabilized unlevered cash yield on total investment. According to CBRE, the vacancy rate in the 115 msf Orange County North submarket was 0.9% at the end of the third quarter 2021.

1168 Sherborn Blvd, located in Corona, within the Inland Empire West submarket -- for $23.4 mil, or approximately $295 per square foot. The 79.5k sf building was acquired in a long-term sale-leaseback transaction with in-place rent estimated to be 25% below market rates. The initial 3.5% unlevered cash yield is projected to grow over time driven by contractual 3.75% annual rent escalations. According to CBRE, the vacancy rate in the 319 msf Inland Empire West submarket was 0.8% at the end of the third quarter 2021.




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