Yahoo Finance Terreno (TRNO) Grows Portfolio With Long Island City Property
Terreno Realty Corporation TRNO shelled out $23.0 million to purchase an industrial property in Long Island City, Queens, NY. The move comes as part of the company’s acquisition-driven growth strategy.
Located at 42-11 9th Street, the industrial property comprises one industrial distribution building containing roughly 45,000 square feet on 1.1 acres. The property’s advantageous location — immediately adjacent to the Queensboro 59th Street Bridge connecting Manhattan and Queens — is likely to attract tenants. Currently, it is 100% leased on a short-term basis and the estimated stabilized cap rate is 5.2%.
Amid an e-commerce boom, growth in industries and companies making efforts to improve supply-chain efficiencies, the demand for industrial real estate space has been shooting up. TRNO is banking on such opportunities and is focused on expanding its portfolio through acquisitions.
Further, the company is targeting functional assets at in-fill locations. Such assets enjoy high-population densities and are located near high-volume distribution points.
With such expansion efforts, Terreno Realty is well-poised to enhance its portfolio in six major coastal U.S. markets — Los Angeles, Northern New Jersey/New York City, San Francisco Bay Area, Seattle, Miami and Washington, DC. These markets display solid demographic trends and witness healthy demand for industrial real estate.
Recently, Terreno Realty acquired an industrial property in Hialeah, FL, for $173.6 million. Located in Miami’s Countyline Corporate Park, the industrial property is next to TRNO’s seven fully leased buildings within Countyline. It comprises a 121-acre project entitled to 2.2 million square feet of industrial distribution buildings. The completion of the project is expected in 2025 and will have a total expected investment of $491.4 million.
In the fourth quarter, TRNO acquired four properties, comprising three buildings encompassing roughly 65,000 square feet, and one improved land parcel of 2.8 acres for $59.4 million. For 2022, Terreno Realty’s acquisition activity included 20 properties. These comprised 17 buildings encompassing roughly 831,000 square feet, and 11 improved land parcels of 35.7 acres for $414.8 million.
Apart from the fast adoption of e-commerce, the industrial real estate space is poised to gain traction over the long run from a likely rise in the inventory levels of companies as a precaution for any supply-chain disruption. This will offer opportunities to industrial landlords, including TRNO, Prologis PLD and First Industrial Realty Trust, Inc. FR, to enjoy a favorable market environment.
Shares of Terreno Realty, currently carrying a Zacks Rank #2 (Buy), have climbed 8.8% in the past three months compared with the industry’s growth of 0.8%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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Prologis carries a Zacks Rank of 3 at present. Prologis’ long-term growth rate is projected at 7.20%. The Zacks Consensus Estimate for PLD’s 2023 funds from operations (FFO) per share of $5.53 suggests a 7.2% year-over-year increase.
First Industrial Realty currently carries a Zacks Rank of 3. The Zacks Consensus Estimate for FR’s 2023 funds from operations (FFO) per share of $2.40 indicates a 5.3% year-over-year increase.
Note: Anything related to earnings presented in this write-up represent funds from operations (FFO) — a widely used metric to gauge the performance of REITs.
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Prologis, Inc. (PLD) : Free Stock Analysis Report
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