Rexford Industrial Acquires Eight Properties for $270 Million - Full Year 2021 Acquisitions Total $1.9 Billion
January 03, 2022 at 07:00 am EST
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Rexford Industrial Realty, Inc. announced the acquisition of eight industrial properties for an aggregate purchase price of $270 million. The acquisitions were funded using cash on hand and proceeds from forward equity settlements. For the full year 2021, the Company acquired $1.9 billion of industrial properties, bringing the Company's total portfolio to 296 properties comprising approximately 37.1 million square feet within prime infill Southern California "last-mile" submarkets. In December, through off-market and lightly marketed transactions, the Company acquired: A property located in the western portion of the City of Industry, CA, within the LA San Gabriel Valley submarket for $28.6 million, or $86 per land square foot. The 7.6-acre site contains a single tenant 111,927 square foot 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 million square-foot San Gabriel Valley submarket was 0.2% at the end of the third quarter 2021. 2391-2393 Bateman Avenue, located in Irwindale, within the LA San Gabriel Valley submarket for $23.1 million, or $352 per square foot. The 65,605 square foot, 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 million, or $287 per square foot. The 56,915 square foot 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 Avenue, located in Los Angeles, within the LA Greater San Fernando Valley submarket for $43.0 million, or $368 per square foot. The 5.7-acre site contains a 117,000 square foot, 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 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 million square-foot Greater San Fernando Valley submarket was 1.1% at the end of the third quarter 2021. 4240 W. 190th Street, located in Torrance, within the LA South Bay submarket for $75.3 million, or $149 per land square foot. The fully leased, 307,000 square foot, 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 million square-foot LA - South Bay submarket was 0.6% at the end of the third quarter 2021.
Rexford Industrial Realty, Inc. is a self-administered and self-managed full-service real estate investment trust (REIT). The Company is focused on owning, operating and acquiring industrial properties in Southern California infill markets. It acquires, owns, improves, redevelops, leases, and manages industrial real estate principally located in Southern California infill markets, through Rexford Industrial Realty, L.P. (Operating Partnership) and its subsidiaries. It also acquires or provides mortgage debt secured by industrial property. It provides property management services and leasing services to related parties and third-party property owners. Its property management services include performing property inspections, monitoring repairs and maintenance, negotiating vendor contracts, maintaining tenant relations and providing financial and accounting oversight. The Company's portfolio consists of over 422 properties with approximately 49.1 million rentable square feet.