Terreno Realty (TRNO) Unveils Major Lease & Development Updates – June 21, 2023
Terreno Realty (TRNO – Free Report) recently signed a 10-year lease for a 41,000 square feet area in Hialeah, FL, with an international logistics service provider. The lease is set to commence in November 2023 once tenant improvements are completed.
TRNO also provided a development update on Countyline Corporate Park Phase IV. Building 41, a 191,000-square-foot rear-load industrial distribution building, is now 100% pre-leased. Slated for construction completion in the third quarter of 2023, the building is on track for LEED certification, indicative of Terreno’s commitment to sustainability. The total estimated investment in this building is $41.4 million, with a projected stabilized cap rate of 5.1%.
Meanwhile, Building 38, a 506,000-square-foot cross-dock industrial distribution building, is also fully pre-leased and under construction. Its completion is expected in the third quarter of 2024, with an estimated investment of $88.8 million and a stabilized cap rate of 5.0%. The leasing activities reflect solid demand for under-construction buildings.
Moreover, in the second quarter of 2023, construction began for Buildings 39 and 40, both planned to achieve stabilization in the fourth quarter of 2024. The buildings will offer an aggregate of 364,000 square feet, with an estimated investment of $84.6 million and a stabilized cap rate of 6%.
Terreno’s Countyline Corporate Park Phase IV is a 121-acre project aiming to offer 2.2 million square feet of industrial distribution buildings in Miami’s Countyline Corporate Park. Adjacent to TRNO’s seven fully leased buildings within Countyline Corporate Park Phase III, Phase IV will house 10 LEED-certified industrial distribution buildings upon its completion in 2025. The total investment is projected at around $492.7 million.
These development updates strengthen Terreno’s strategic positioning in the industrial real estate sector. With an advantageous location, the buildings are expected to lure tenants and enjoy high occupancy.
On a combined basis, Terreno’s Countyline Corporate Park Phase III and IV will comprise 17 industrial distribution buildings spanning over 3.5 million square feet, making Terreno a major player in the Miami industrial real estate sector.
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, Rexford Industrial Realty (REXR – Free Report) and STAG Industrial (STAG – Free Report) , to enjoy a favorable market environment.
Shares of Terreno Realty, currently carrying a Zacks Rank #3 (Hold), have risen 1.3% in the past six months against the industry’s decline of 1.1%.
Image Source: Zacks Investment Research
Rexford Industrial Realty carries a Zacks Rank of 3 at present. Rexford Industrial Realty’s long-term growth rate is projected at 10.6%. The Zacks Consensus Estimate for REXR’s 2023 funds from operations (FFO) per share of $2.19 suggests an 11.7% year-over-year increase. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
STAG Industrial currently carries a Zacks Rank of 3. The Zacks Consensus Estimate for STAG’s 2023 FFO per share of $2.25 indicates a 1.8% 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.
Disclaimer: This article has been written with the assistance of Generative AI. However, the author has reviewed, revised, supplemented, and rewritten parts of this content to ensure its originality and the precision of the incorporated information.
