Terreno Realty to Sell 6.5M Shares - Analyst Blog

On Wednesday, Terreno Realty Corp. TRNO, the San Francisco, CA-based real estate investment trust (REIT), announced its plan to sell 6.5 million common shares in an underwritten public offering. The net proceeds accrued from this follow-on-public-offering FPO will be used for future acquisitions, general corporate purposes and debt repayment.

This FPO is subject to effective shelf registration statement previously filed with the Securities and Exchange Commission (SEC). Per the transaction, a 30-day option to purchase additional common shares up to 975,000 will be granted to the underwriters. Goldman Sachs & Co. and KeyBanc Capital Markets Inc. are jointly serving as the book-running managers of this FPO.

Notably, Terreno Realty is an acquirer, owner and operator of industrial real estate in the U.S. Its main areas of operations are the coastal markets in Los Angeles, Northern New Jersey/New York City, San Francisco Bay Area, Seattle, Miami and Washington D.C./Baltimore.

In recent times, this REIT has been on an acquisition spree. Terreno Realty inked two separate acquisition deals on two consecutive days this month, having a combined value of $31.4 million. In first-quarter 2014 and fourth-quarter 2013, the company purchased properties worth $33.8 million and $99.6 million, respectively. Acquisition of industrial properties is the basic strategy followed by the company and this FPO will help it fund its future acquisitions.

Terreno Realty currently sports a Zacks Rank #1 (Strong Buy). Some other equity REITs worth considering include The GEO Group, Inc. GEO,  RLJ Lodging Trust RLJ and W. P. Carey Inc. WPC. All of these stocks sport the same Zacks Rank as Terreno Realty.