Terreno Realty Corporation (TRNO – Free Report) acquired an industrial property in Rancho Dominguez, CA for $13.8 million. This latest acquisition comes after the company shelled out $8 million to purchase an industrial property at 5380 Tuxedo Road, Hyattsville, MD.
Reflecting positive sentiments, shares of TRNO gained 2.56% during Thursday’s trading session.
The Rancho Dominguez property, leased on a short-term basis through March 2022, is a 2.3-acre improved land parcel at 14725 S. Maple Avenue. It is between Los Angeles International Airport, and the Ports of Los Angeles and Long Beach, next to Terreno Realty’s improved land parcel at 14732 S. Maple Avenue, representing an advantageous location and positioning it well to lure the tenants. The estimated stabilized cap rate of the property is 4.9%.
Amid an e-commerce boom, growth in industries and companies making efforts to improve supply-chain efficiencies, demand for industrial real estate space continues to be high. Terreno Realty is banking on such scope and is focused on expanding its portfolio on acquisitions. It targets the functional assets at in-fill locations, which enjoy high-population densities and are located near the high-volume distribution points.
Recently, TRNO shelled out $7.7 million to purchase an industrial property in Los Angeles, CA. Also, it announced the buyout of an industrial property in Alexandria, VA for $9 million and another in Elizabeth, NJ for $44 million.
Apart from the fast adoption of e-commerce, industrial real estate is anticipated to benefit from an increase in the inventory levels post the global health crisis, offering scope to industrial landlords, including Terreno Realty and other industrial REITs to enjoy a favorable market environment.
Terreno Realty currently carries a Zacks Rank #2 (Buy). In the past six months, TRNO’s shares have gained 19.9% compared with the industry’s increase of 4%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Image Source: Zacks Investment Research
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Note: Anything related to earnings presented in this write-up represents funds from operations (FFO) — a widely used metric to gauge the performance of REITs.