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5/30/24
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Rexford Industrial Realty closed on two industrial property purchases in deals with a combined price of $143 mil during the month of May. The SoCal-based firm also completed the disposition of three properties for an aggregate sales price of $27 mil during the month. The acquisitions were funded using cash on hand and 1031 exchange disposition proceeds. Year to date, Rexford Industrial has completed $1.3 bil of acquisitions and $37 mil of dispositions.
In one of the acquisitions, Rexford purchased a 278.6k sf property on 12 acres at 1901 E Rosslynn Ave in Fullerton for $94.3 mil, or $338 per square foot. The single-tenant industrial building features 30-foot clear height and excess land for outside storage and trailer parking. It is leased to a highly entrenched tenant.
The investment generates an initial unlevered cash yield of 5.6%, growing through annual embedded rent steps of 4.25%. According to CBRE, the vacancy rate in the 115 msf North Orange County submarket was 1.0% at the end of the first quarter 2024.
In the other purchase, Rexford bought 16203-16233 Arrow Highway in the city of Irwindale for $48.5 mil, or $360/sf in an off-market transaction. The six-acre property contains 134.5k sf of improvements comprising four newly developed, Class A industrial buildings featuring best-in-class 30-foot warehouse clear height and highly-sought-after dock-high loading.
The investment generates an initial unlevered cash yield of 6.2%, growing through average annual embedded rent steps of 4.2%. According to CBRE, the vacancy rate in the 161 msf LA – San Gabriel Valley submarket was 3.0% at the end of the first quarter 2024.
Rexford’s dispositions during May included:
• 6407-6431 Alondra Blvd, Paramount, located in the LA – South Bay submarket, for $7.6 mil or $251/sf. The two multi-tenant buildings total 30.2k sf and were 81% occupied at the time of sale. The unlevered IRR to the company is 16.6%.
• 15401 Figueroa St, Los Angeles, located in the LA – South Bay submarket, for $10.2 mil, or $265/sf. The 38.4k sf, single-tenant industrial building was sold vacant to a user for an unlevered IRR to the company of 12.6%.
• 8210 Haskell Ave, Van Nuys, located in the LA – Greater San Fernando Valley submarket, for $9.2 mil or $351/sf. The 26.2k sf, single-tenant industrial building was sold vacant to a user for an unlevered IRR to the company of 9.6%.
Rexford currently has a near-term acquisition pipeline comprising approximately $40 mil of new investments within prime infill Southern California industrial markets under contract or accepted offer.
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