Terreno Closes $33.8M Acquisitions in Q1 - Analyst Blog

Terreno Realty Corporation TRNO closed $33.8 million worth of acquisitions spanning 319,000 square feet in first-quarter 2014. This included 3 industrial properties comprising 3 buildings.

Specifically, the first-quarter acquisitions added SW 34th -- an industrial building (spanning around 62,000 square feet) in Renton, WA for around $6.6 million; Parkway -- a cross-dock industrial building (159,000 square feet) in Hanover, MD for about $18.0 million; and Pulaski -- an industrial building (98,000 square feet) in Bayonne, NJ for about $9.2 million. Furthermore, currently Terreno Realty has around $21.5 million of purchases under contract and $26.5 million under letter of intent.

This series of acquisitions comes as this industrial real estate investment trust (REIT) leverages on the improving fundamentals of the industrial markets and focuses on strengthening its business in key coastal U.S. markets – the high barriers-to-entry markets of Los Angeles; Northern New Jersey/New York City; San Francisco Bay Area; Seattle; Miami; and Washington, D.C./Baltimore.

Increased automotive purchases and overall consumer spending in recent times reflects a sound recovery in industrial production. This keeps us encouraged and is expected to drive the demand for industrial real estates going forward. With a low supply, we believe that well-poised industrial REITs would be able to leverage on it and drive profitability higher going forward.

Terreno Realty's quarter-end occupancy came in at 93.5%, up from 92.8% in the prior quarter. The company had 99 buildings (around 7.1 million square feet) as of Mar 31, 2014, that were leased to 220 tenants.

Apart from these acquisitions, Terreno Realty launched an “at the market” (ATM) equity offering program for up to $100 million of common stock. Notably, the company did not issue any shares under its ATM during the first quarter.
 
Terreno Realty currently has a Zacks Rank #3 (Hold). Some better-ranked stocks in the REIT industry include Boston Properties Inc. BXP, Cousins Properties Inc. CUZ, and Duke Realty Corp. DRE. All three stocks have a Zacks Rank #2 (Buy).