Rexford Grows Industrial Holdings With $100M Buy
- Dec 13, 2019
Rexford Industrial Realty’s portfolio continues to swell as the REIT has acquired two properties totaling roughly 808,800 square feet in the Greater Los Angeles area. Rexford purchased Pomona Distribution Center and the building at 2757 E. Del Amo Blvd. in separate all-cash transactions totaling $99.7 million.
Rexford paid $87.8 million for Pomona Distribution Center, a 751,500-square-foot facility occupying 32.2 acres at 1601 W. Mission Blvd. in Pomona, within the San Gabriel Valley submarket. The 751,500-square-foot property is 100 percent leased to Lumber Liquidators and HD Supply, which renewed its lease of approximately 247,500 square feet in the second quarter of 2018.
In Rancho Dominguez, Rexford purchased 2757 E. Del Amo for $11.9 million. Sited on approximately 3.5 acres, the 57,300-square-foot, South Bay-area building is leased in its entirety to a single tenant, tire company New Pride.
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At Pomona Distribution Center, Rexford will invest in upgrades and bolster cash flow with the increase of below-market rents upon lease turnovers. The REIT will also capitalize on repositioning opportunities upon the expiration of in-place leases at 2757 E. Del Amo.
Given the current state of the metropolitan Los Angeles industrial market, Rexford’s value-add strategy will likely prove successful. Driven by e-commerce and a diverse and growing tenant base, industrial demand remains exceedingly robust across the Greater Los Angeles area, according to a third quarter report by JLL. At just 1.9 percent, the industrial vacancy rate in Los Angeles remains the lowest in the U.S., even in the face of 1 million square feet of new product delivered in the third quarter.
Southern California’s infill markets are Rexford’s playground of choice; despite strong investor competition, the REIT had been highly acquisitive in 2019. Except for February, nary a month has elapsed without an investment announcement. Transactions during the fourth quarter include the separate purchase of three assets totaling 500,000 square feet in Los Angeles and Ventura counties for an aggregate $76 million in cash.