Rexford Industrial Realty, Inc. has acquired, 720-750 N Vernon Avenue, an industrial property, located in Azusa within the LA – San Gabriel Valley submarket, for $15.5 million, or $59 per land square foot.
The acquisition was funded using cash on hand, said the company in a press release.
The low coverage property, which was acquired through a sale-lease-back transaction underwritten on a land value basis, comprises 71,692 square feet of buildings on 6.05 acres of land. The property is fully leased on a long-term, triple net basis.
“Acquired as a sale-lease-back through an off-market transaction, this investment demonstrates our team’s ability to leverage Rexford’s proprietary originations capability to deliver a creative solution to a seller seeking to unlock value and capital captive in their real estate. This transaction is also indicative of our commitment to deliver substantially above-market cash yields by investing within infill Southern California, the nation’s largest, highest demand and most supply-constrained industrial market,” stated Howard Schwimmer and Michael Frankel, Co-Chief Executive Officers of the Company.
“Vernon Avenue is a well located, fully occupied industrial property with a long-term in-place triple net lease, providing a favorable level of recurring cash flow plus the potential for future value-add redevelopment given the relatively low implied value of the underlying land. Looking forward, we believe Rexford is well-positioned with a fortress-like, low-leverage balance sheet to capitalize upon emerging internal and external growth opportunities in order to create value for shareholders.”
Rexford Industrial intends to harvest cash flow from the in-place lease, and, upon lease expiration, to redevelop the site by constructing a new, substantially larger Class A warehouse/distribution facility.