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STAG Industrial Announces Acquisition, Disposition and Leasing Activity for the Month of December and Full Year 2015

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BOSTON, Jan. 6, 2016 /PRNewswire/ -- STAG Industrial, Inc. (the "Company") (NYSE: STAG), a real estate investment trust (REIT) focused on the acquisition and operation of single-tenant, industrial properties throughout the United States, today announced its acquisition, disposition and leasing activity for the month of December and full year 2015.

Acquisitions

In December, the Company acquired ten buildings consisting of approximately 2.2 million square feet for $108.7 million.  The acquired buildings are 93% occupied.  The chart below details the December acquisition activity:

 

DECEMBER 2015 ACQUISITIONS

Location (CBSA) (1)

Date Acquired

Square Feet

Buildings

Purchase Price
($MM) (2)

Weighted Average
Lease Term (Years)

Milwaukee-Waukesha-West Allis, WI

12/4/2015

241,977

4

$9.9


7.3

Knoxville, TN

12/10/2015

104,000

1

5.4


5.0

Dallas-Fort Worth-Arlington, TX

12/11/2015

164,914

1

7.6


NA

Greenville-Mauldin-Easley, SC

12/11/2015

125,000

1

5.5


4.6

Lancaster, PA

12/17/2015

240,529

1

9.4


2.4

Grand Rapids-Wyoming, MI

12/23/2015

301,317

1

9.4


5.1

Philadelphia-Camden-Wilmington, PA-NJ-DE-MD

12/31/2015

1,048,631

1

61.5


5.0

Total/Weighted Average


2,226,368

10

$108.7


4.9

(1)Core based statistical area

(2)Excludes property acquisition costs

 

For the quarter ended December 31, 2015, the Company acquired 14 buildings consisting of approximately 3.1 million square feet for $138.5 million. The weighted average estimated cap rate for the buildings acquired in the quarter was 8.7%. Estimated cap rates are calculated by dividing the underwritten net operating income for the first twelve months by the purchase price. The chart below details the acquisition activity for the year ended December 31, 2015:

 

 2015 ACQUISITION ACTIVITY

Quarter

Square Feet


Buildings


Purchase Price ($MM) (1)


Weighted Average Lease Term (Years)

Q1

1,485,717


5


$97.1



5.7

Q2

1,639,383


12


83.8



6.0

Q3

2,509,084


18


108.3



5.5

Q4

3,057,668


14


138.5



4.9

Total/Weighted Average

8,691,852


49


$427.7



5.4

(1)Excludes property acquisition costs

 

As of January 5, 2016, the Company has entered into contracts to acquire two buildings for $18 million. The Company has also executed non-binding letters of intent to acquire three additional buildings for $20 million

As of January 5, 2016, the Company's pipeline of potential acquisitions is $1.4 billion across 133 buildings.  The pipeline is a point in time measure that includes all of the transactions under consideration by the Company's acquisitions group that have passed the initial screening process.  The pipeline also includes transactions under contract and transactions with non-binding LOIs.

The purchase and sale agreements for the properties under contract are subject to satisfaction of closing conditions, and the properties under LOI require the negotiation and execution of definitive purchase and sale agreements.  There can be no assurance that any of the properties under contract or LOI will be acquired on the terms anticipated or at all.

Dispositions

In December, the Company sold one building consisting of 270,000 square feet for $3.7 million.  For the year ended December 31, 2015, the Company sold six buildings consisting of 808,387 square feet for $22 million. The chart below details the disposition activity for the year ended December 31, 2015:

 

2015 DISPOSITIONS (1)


Year


Square Feet

Buildings


Net Proceeds(2)


Q1


0


0


$0.0



Q2


0


0


0.0



Q3


321,810


2


9.2



Q4


486,577


4


12.8



Total


808,387


6


$22.0


(1)Proceeds equal sales price less closing costs

 

Leasing 

In December, the Company executed three leases totaling 731,585 square feet consisting of 529,785 square feet of new leases and 201,800 square feet of renewal leases. The chart below details the December leasing activity:

 

DECEMBER 2015 LEASING ACTIVITY

Lease Type

Square Feet

Base Rent
$/PSF

Lease
Commissions
$/PSF

Tenant
Improvements
$/PSF

Total Costs
$/PSF

Cash Rent
Change (1)(3)

GAAP Rent
Change (2)(3)

New Leases

529,785


$2.72


$0.88


$0.94


$1.82


0.5%

12.6%

Renewal Leases

201,800


3.15


0.48


0.26


0.74


0.6%

14.1%

Total /Weighted Avg New & Renewal

731,585


$2.84


$0.77


$0.76


$1.53


0.5%

13.0%

Temporary Leases

0












Total Leasing Activity

731,585












(1) Cash basis rent growth is a ratio of the change in base rent (excluding straight-line rent adjustments as required by GAAP) of the comparable lease

(2)GAAP basis rent growth is a ratio of the change in base rent (including straight-line rent adjustments as required by GAAP) of the comparable lease

(3)Rent change for new leases where there were no prior comparable leases, due to extended downtime or materially different lease structures are excluded

 

For the quarter ended December 31, 2015, the Company executed ten leases for approximately 1.4 million square feet, including 529,785 square feet of new leases, 251,800 square feet of renewal leases, and 657,970 square feet of temporary leases.  The chart below details the leasing activity for the quarter ended December 31, 2015:

 

FOURTH QUARTER 2015 LEASING ACTIVITY

Lease Type

Square Feet

Base Rent $/PSF

Lease
Commissions
$/PSF

Tenant
Improvements
$/PSF

Total Costs
$/PSF

Cash Rent
Change  (1)(3) 

GAAP Rent
Change  (2)(3) 

New Leases

529,785


$2.72


$0.88


$0.94


$1.82


0.5%

12.6%

Renewal Leases

251,800


3.22


0.42


0.21


0.63


0.5%

10.9%

Total /Weighted Avg New & Renewal

781,585


$2.88


$0.73


$0.71


$1.44


0.5%

12.0%

Temporary Leases

657,970












Total Leasing Activity

1,439,555












(1) Cash basis rent growth is a ratio of the change in base rent (excluding straight-line rent adjustments as required by GAAP) of the comparable lease.

(2)GAAP basis rent growth is a ratio of the change in base rent (including straight-line rent adjustments as required by GAAP) of the comparable lease.

(3)Rent change for new leases where there were no prior comparable leases, due to extended downtime or materially different lease structures are excluded.

 

For the year ended December 31, 2015, the Company executed 55 leases for approximately 5.7 million square feet, including 1.4 million square feet of new leases, 3.0 million square feet of renewal leases, and 1.4 million square feet of temporary leases.  The chart below details the leasing activity for the year ended December 31, 2015:

2015 LEASING ACTIVITY

Quarter


New Square
Feet


Renewal Square
Feet


Temporary Square
Feet


Total Leasing
Activity Square
Feet


Q1


167,200



136,653



245,280



549,133



Q2


385,295



1,346,025



365,620



2,096,940



Q3


357,028



1,215,848



87,900



1,660,776



Q4


529,785



251,800



657,970



1,439,555



Total


1,439,308



2,950,326



1,356,770



5,746,404



 

Six leases consisting of 806,030 square feet expired in the fourth quarter and the tenant retention rate for these leases was 49.2%. The chart below reflects the tenant retention rate for the year ended December 31, 2015:

 

2015 RETENTION

Quarter

Expiring Square
Footage

Retained Square
Footage

Retention
Rate (1)

Cash Rent
Change(1)

GAAP Rent
Change(1)

Q1

1,528,723


979,987


64.1%


6.7%


9.6%


Q2

468,169


136,789


29.2%


3.9%


10.0%


Q3

2,135,464


1,931,464


90.4%


3.3%


8.5%


Q4

806,030


396,430


49.2%


0.8%


4.2%


Total / Weighted Average

4,938,386


3,444,670


69.8%


4.2%


8.4%


(1)Based on square feet retained in the period

 

The Company's occupancy rate for the fourth quarter was 95.6%. The chart below reflects the occupancy and total square footage for the year ended December 31, 2015:

 

2015 OCCUPANCY

Quarter

Number of Buildings

Total Square Footage

Occupancy %

Q1

253


48,533,893


94.4%

Q2

265


49,954,019


95.0%

Q3

281


52,141,293


95.7%

Q4

291


54,712,384


95.6%

About STAG Industrial, Inc.

STAG Industrial, Inc. is a real estate investment trust (REIT) focused on the acquisition and operation of single-tenant, industrial properties throughout the United States. The Company's portfolio consists of 291 properties in 38 states with approximately 54.7 million rentable square feet.

For additional information, please visit the Company's website at www.stagindustrial.com.  

Forward-Looking Statements

This press release, together with other statements and information publicly disseminated by the Company, contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. The Company intends such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995 and includes this statement for purposes of complying with these safe harbor provisions. Forward-looking statements, which are based on certain assumptions and describe the Company's future plans, strategies and expectations, are generally identifiable by use of the words "believe," "will," "expect," "intend," "anticipate," "estimate," "should," "project" or similar expressions. You should not rely on forward-looking statements since they involve known and unknown risks, uncertainties and other factors that are, in some cases, beyond the Company's control and which could materially affect actual results, performances or achievements. Factors that may cause actual results to differ materially from current expectations include, but are not limited to, the risk factors discussed in the Company's annual report on Form 10-K for the year ended December 31, 2014 as updated by the Company's quarterly reports on Form 10-Q. Accordingly, there is no assurance that the Company's expectations will be realized. Except as otherwise required by the federal securities laws, the Company disclaims any obligation or undertaking to publicly release any updates or revisions to any forward-looking statement contained herein (or elsewhere) to reflect any change in the Company's expectations with regard thereto or any change in events, conditions or circumstances on which any such statement is based.

 

To view the original version on PR Newswire, visit:http://www.prnewswire.com/news-releases/stag-industrial-announces-acquisition-disposition-and-leasing-activity-for-the-month-of-december-and-full-year-2015-300200540.html

SOURCE STAG Industrial, Inc.

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