Rexford Industrial Realty, Inc. has acquired a ten-building industrial property portfolio in Southern California for $203.2 million, or $234 per square foot, including assumed debt.
The industrial property portfolio consists of three single-tenant and seven multi-tenant industrial properties containing a total of 867,242 square feet on 43.06 acres of land.
The properties are located in four of the Company’s core infill Southern California markets, including LA – South Bay, LA – Mid Counties, Inland Empire – West and Orange County. Approximately two-thirds of the assets are located in the region’s top-performing LA – South Bay submarket, which ended the fourth quarter of 2019 with a vacancy rate of 0.8%, according to CBRE.
The portfolio’s tenant pool is also highly diversified, with no single tenant occupying more than 12.9% of the total rentable area.
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“We are pleased to announce Rexford’s acquisition of this ten-building industrial portfolio located within our prime, infill Southern California target submarkets,” stated Howard Schwimmer and Michael Frankel, Co-Chief Executive Officers of the Company.
“Our team was able to leverage our proprietary research and relationship-driven originations capability to acquire this portfolio through a lightly-marketed transaction. Currently 87.7% leased to 56 tenants with average in-place rents estimated to be materially below-market, this investment provides an above-market cash yield as well as the potential for favorable cash flow growth into future periods through a combination of leasing and value-add enhancements. Located within some of the most supply-constrained and best performing submarkets within infill Southern California, these assets represent a strategic, accretive expansion within our core target markets. Our ability to offer OP and Series 2 CPOP Units provided the seller with a unique value proposition through a tax-efficient UPREIT structure delivering ownership in Rexford Industrial, one of the nation’s largest logistics REITs differentiated by our entrepreneurial, value-driven focus on the nation’s largest industrial market with leading tenant-demand fundamentals. Looking forward, we are excited at the prospects before us to drive accretive internal and external growth to maximize shareholder value,” he added.
