Core Insights - Rexford Industrial Realty (REXR) provided an update on its operations, dispositions, and capital markets for the third quarter of 2025 ahead of investor meetings [1] Leasing Activity - From the beginning of the third quarter through September 2, 2025, REXR executed 1.9 million square feet of new and renewal leases, with an average unit size of 25,000 square feet, including approximately 1,604,000 square feet of new leases and 303,000 square feet of renewal leases [2] - The company also leased 407,000 square feet for repositioning and redevelopment projects during the same period [2] - Comparable rental rates on new and renewal leases increased by 30% on a net effective basis and by 15% on a cash basis in the third quarter [3] - The occupancy rate for the same property portfolio reached 96.6% as of August 31, 2025, a 50-basis-point increase compared to the previous quarter [3] Disposition Update - In the third quarter of 2025, REXR disposed of two properties totaling 76,000 square feet for $32 million [4] - Year-to-date through August 31, 2025, the company disposed of five properties totaling 412,000 square feet for $166 million [4] - REXR has approximately $90 million of dispositions under contract or accepted offer, with no acquisitions under contract or accepted offer [4] Capital Markets Update - In July and August 2025, REXR repurchased 2,697,100 shares of common stock for $100 million under an authorized share repurchase program [5] - On August 29, 2025, the board of directors authorized a new $500 million share repurchase program, replacing the previous $300 million program [5] - In July 2025, REXR repaid a $100 million unsecured senior note with an interest rate of 4.29% using cash on hand [5] Management Commentary - Co-CEOs Michael Frankel and Howard Schwimmer noted that leasing volumes in July and August exceeded the prior full quarter, indicating improving market fundamentals [6] - They highlighted the successful lease-up of over 400,000 square feet of repositioned and redeveloped assets, with healthy double-digit leasing spreads [6] - The management emphasized their commitment to delivering value through accretive capital recycling and a strategic approach to capital allocation [6] - REXR's shares gained 14.1% over the past three months, compared to the industry's growth of 0.3% [6]

Company Overview - Rexford Industrial Realty is a self-administered and self-managed full-service real estate investment trust (REIT) focused on owning, operating, and acquiring industrial properties in Southern California infill markets, with a portfolio of 424 properties totaling approximately 51.0 million rentable square feet [1] - The company also engages in acquiring or providing mortgage debt secured by industrial-zoned property and offers property management and leasing services [1] Activist Involvement - Elliott Investment Management has taken a position in Rexford Industrial Realty, indicating a significant economic exposure estimated between $400 million to $500 million, likely closer to $1 billion [3][7] - Elliott is known for advocating better corporate governance and capital allocation, aiming to restore strategic focus on shareholder value [8] Market Context - The industrial REIT sector has benefited from strong secular tailwinds due to the rise of e-commerce, increasing demand for warehouse space, particularly in Southern California, which faces land scarcity and entitlement challenges [4] - Historically, Rexford has traded at a premium to net asset value (NAV), but currently trades at a 20% discount to NAV and a 5-6 turn AFFO discount to peers, with stock prices declining from over $80 in December 2021 to around $40 [6][10] Strategic Implications - The involvement of Elliott may catalyze strategic outcomes for Rexford, making it a potential acquisition candidate due to its premium assets and current discounted valuation [10][11] - If an acquisition opportunity arises, Elliott would evaluate the best path for shareholder value, potentially favoring an acquisition at a reasonable premium over a long-term standalone plan [12]

Investment Activity - Elliott Investment Management 已在洛杉矶房地产投资信托公司 Rexford 中建立了积极的股份 [1]

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Group 1 - The article emphasizes the importance of conducting thorough research and due diligence before making investment decisions to ensure value relative to cost [1] - iREIT® offers comprehensive research on various investment vehicles including REITs, mREITs, Preferreds, BDCs, MLPs, ETFs, Builders, and Asset Managers [2] - The iREIT® Tracker provides data on over 250 tickers, including quality scores, buy targets, and trim targets, enhancing investment decision-making [2] Group 2 - A new Ratings Tracker called iREIT Buy Zone has been introduced to assist members in screening for value investments [2] - The offer includes a 2-week free trial along with a complimentary book, promoting accessibility to in-depth research [4]

PART I. FINANCIAL INFORMATION [Item 1. Financial Statements](index=3&type=section&id=Item%201.%20Financial%20Statements) Presents unaudited consolidated financial statements for Q2 2025 and 2024, detailing balance sheets, operations, income, equity, and cash flows with notes [Consolidated Balance Sheets](index=4&type=section&id=Consolidated%20Balance%20Sheets) The consolidated balance sheets show the company's financial position as of June 30, 2025, compared to December 31, 2024, highlighting changes in assets, liabilities, and equity | Category | June 30, 2025 (in thousands) | December 31, 2024 (in thousands) | | :-------------------------------- | :----------------------------- | :----------------------------- | | **Total Assets** | $13,079,612 | $12,648,218 | | **Total Liabilities** | $3,884,588 | $3,922,239 | | **Total Equity** | $9,195,024 | $8,725,979 | - Total Assets increased by **$431.4 million** from December 31, 2024, to June 30, 2025, primarily driven by an increase in cash and cash equivalents and construction in progress[9](index=9&type=chunk) - Cash and cash equivalents significantly increased from **$56.0 million** at December 31, 2024, to **$431.1 million** at June 30, 2025[9](index=9&type=chunk) - Construction in progress increased from **$333.7 million** to **$431.8 million**, indicating ongoing development activities[9](index=9&type=chunk) [Consolidated Statements of Operations](index=5&type=section&id=Consolidated%20Statements%20of%20Operations) The consolidated statements of operations detail the company's revenues, expenses, and net income for the three and six months ended June 30, 2025, compared to the same periods in 2024, showing significant growth in net income and earnings per share | Metric | Three Months Ended June 30, 2025 (in thousands) | Three Months Ended June 30, 2024 (in thousands) | Six Months Ended June 30, 2025 (in thousands) | Six Months Ended June 30, 2024 (in thousands) | | :--------------------------------------- | :---------------------------------------------- | :---------------------------------------------- | :-------------------------------------------- | :-------------------------------------------- | | **Total Revenues** | $249,507 | $237,573 | $501,794 | $451,669 | | **Total Operating Expenses** | $146,238 | $139,108 | $308,107 | $272,848 | | **Net Income** | $120,394 | $86,017 | $194,442 | $150,294 | | **Net Income Attributable to Common Stockholders** | $113,427 | $79,752 | $181,773 | $138,391 | | **Net Income Attributable to Common Stockholders per Share - Basic** | $0.48 | $0.37 | $0.78 | $0.64 | - Net income attributable to common stockholders increased by **42.2%** for the three months ended June 30, 2025, and by **31.3%** for the six months ended June 30, 2025, compared to the prior year periods[11](index=11&type=chunk) - Gains on sale of real estate significantly increased to **$44.4 million** for the three months ended June 30, 2025, from **$16.3 million** in the prior year, and to **$57.5 million** for the six months ended June 30, 2025, from **$16.3 million** in the prior year[11](index=11&type=chunk) [Consolidated Statements of Comprehensive Income](index=6&type=section&id=Consolidated%20Statements%20of%20Comprehensive%20Income) The consolidated statements of comprehensive income show the total comprehensive income for the three and six months ended June 30, 2025 and 2024, including net income and other comprehensive income (loss) from cash flow hedge adjustments | Metric | Three Months Ended June 30, 2025 (in thousands) | Three Months Ended June 30, 2024 (in thousands) | Six Months Ended June 30, 2025 (in thousands) | Six Months Ended June 30, 2024 (in thousands) | | :------------------------------------------------- | :---------------------------------------------- | :---------------------------------------------- | :-------------------------------------------- | :-------------------------------------------- | | **Net income** | $120,394 | $86,017 | $194,442 | $150,294 | | **Other comprehensive (loss) income: cash flow hedge adjustments** | $(2,584) | $(91) | $(5,869) | $6,888 | | **Comprehensive income** | $117,810 | $85,926 | $188,573 | $157,182 | | **Comprehensive income attributable to Rexford Industrial Realty, Inc.** | $113,844 | $82,388 | $181,879 | $150,509 | - Other comprehensive income saw a significant loss of **$(5.9) million** for the six months ended June 30, 2025, compared to a gain of **$6.9 million** in the prior year, primarily due to cash flow hedge adjustments[14](index=14&type=chunk) [Consolidated Statements of Changes in Equity](index=7&type=section&id=Consolidated%20Statements%20of%20Changes%20in%20Equity) The consolidated statements of changes in equity provide a detailed breakdown of the movements in preferred stock, common stock, additional paid-in capital, cumulative distributions, accumulated other comprehensive income, and noncontrolling interests for the six months ended June 30, 2025 and 2024 | Equity Component | Balance at Dec 31, 2024 (in thousands) | Changes for Six Months Ended June 30, 2025 (in thousands) | Balance at June 30, 2025 (in thousands) | | :--------------------------------- | :------------------------------------- | :---------------------------------------- | :------------------------------------ | | Preferred Stock | $155,676 | $0 | $155,676 | | Common Stock | $2,253 | $114 | $2,367 | | Additional Paid-in Capital | $8,601,276 | $538,988 | $9,140,264 | | Cumulative Distributions in Excess of Earnings | $(441,881) | $(20,428) | $(462,309) | | Accumulated Other Comprehensive Income | $6,746 | $(5,654) | $1,092 | | Total Stockholders' Equity | $8,324,070 | $513,020 | $8,837,090 | | Noncontrolling Interests | $401,909 | $(43,975) | $357,934 | | **Total Equity** | **$8,725,979** | **$469,045** | **$9,195,024** | - Issuance of common stock, net of offering costs, contributed **$477.6 million** to additional paid-in capital during the six months ended June 30, 2025[24](index=24&type=chunk) - Net income attributable to Rexford Industrial Realty, Inc. for the six months ended June 30, 2025, was **$187.5 million**[24](index=24&type=chunk) - Common stock dividends paid amounted to **$203.3 million** for the six months ended June 30, 2025[24](index=24&type=chunk) [Consolidated Statements of Cash Flows](index=11&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) The consolidated statements of cash flows provide a summary of cash generated from or used in operating, investing, and financing activities for the six months ended June 30, 2025 and 2024, showing a significant increase in cash and cash equivalents | Cash Flow Activity | Six Months Ended June 30, 2025 (in thousands) | Six Months Ended June 30, 2024 (in thousands) | | :----------------------------------- | :-------------------------------------------- | :-------------------------------------------- | | **Net cash provided by operating activities** | $280,708 | $235,419 | | **Net cash used in investing activities** | $(33,386) | $(1,366,616) | | **Net cash provided by financing activities** | $257,895 | $1,223,463 | | **Increase in cash, cash equivalents and restricted cash** | $505,217 | $92,266 | | **Cash, cash equivalents and restricted cash, end of period** | $561,188 | $125,710 | - Net cash provided by operating activities increased by **$45.3 million (19.2%)** for the six months ended June 30, 2025, compared to the prior year[29](index=29&type=chunk) - Net cash used in investing activities decreased significantly by **$1.33 billion**, primarily due to a **$1.24 billion** decrease in property acquisitions and a **$94.5 million** increase in proceeds from real estate sales[29](index=29&type=chunk)[354](index=354&type=chunk) - Cash, cash equivalents, and restricted cash at the end of the period increased substantially to **$561.2 million** in 2025 from **$125.7 million** in 2024[29](index=29&type=chunk) [

Financial Data and Key Metrics Changes - Core FFO for the second quarter was $0.59 per share, a $0.01 increase over the prior quarter when excluding one-time termination revenue [10] - The company reaffirmed its full-year 2025 core FFO outlook of $2.37 to $2.41 per share [10] - The balance sheet ended the quarter with over $1.8 billion of liquidity, including $560 million of cash, and a net debt to EBITDA ratio of four times [12] Business Line Data and Key Metrics Changes - Executed 1.7 million square feet of leases in the quarter, with net effective and cash leasing spreads for comparable leases at 218% [4] - Same property occupancy increased to 96.1%, up 40 basis points sequentially, with positive net absorption of 220,000 square feet [5] - Market rents across the portfolio declined approximately 3.5% sequentially and 12.8% year over year [7] Market Data and Key Metrics Changes - Leasing activity on approximately 80% of vacant spaces, up from 60% a year ago [8] - The company sold two properties totaling $82 million, bringing year-to-date dispositions to $134 million at a weighted average cap rate in the low 4% range [8] Company Strategy and Development Direction - The company remains focused on its value creation strategy through repositioning and redevelopment projects, with a total of over $195 million of incremental cash NOI representing growth of 28% [11] - The company is actively pursuing potential near-term opportunities to recycle disposition proceeds into accretive acquisitions [9] Management's Comments on Operating Environment and Future Outlook - Management noted that while leasing activity remains steady, macroeconomic and tariff uncertainties are impacting tenant decision-making, putting pressure on overall demand [6] - The company expressed confidence in its Southern California portfolio benefiting from persistent supply constraints and strong demand [9] Other Important Information - The company achieved a 7.4% unlevered stabilized yield on total investment from seven stabilized repositioning and redevelopment projects year to date [8] - The cash mark to market for the portfolio stands at 3%, contributing about $20 million of incremental NOI to the embedded growth profile [12] Q&A Session Summary Question: Future repositioning and redevelopment starts - Management indicated that the pipeline is somewhat fluid, with the Hertz asset being a significant driver for future NOI changes [18][20] Question: Cash mark to market trends - Management noted that the cash mark to market is currently at 3%, and future growth will depend on market rent growth and the mix of units rolling [24][28] Question: Capital allocation and acquisition opportunities - Management stated that they are evaluating acquisition opportunities that meet stringent underwriting criteria and are focused on capital allocation that drives cash flow accretion [30][32] Question: Delays in rent commencements - Management acknowledged that lease-up timing has been pushed out by about one month on average due to current market dynamics, but they remain confident in their projections [35][38] Question: Tenant behavior and lease terms - Management reported that lease terms have held steady, with strong renewal activity and an increase in early renewals, indicating tenant strength [42][44] Question: Market rent growth and trends - Management confirmed a decline in market rents due to tariff volatility impacting tenant decision-making, but noted continued leasing activity [48][50] Question: Cap rates and user purchases - Management highlighted that user sales have influenced cap rates, with current market cap rates in the low 5% range [55] Question: Occupancy outlook for the second half of the year - Management expects some deceleration in occupancy due to planned move-outs, with guidance set at 95.5% to 96% [58] Question: Activity on vacant properties - Management confirmed that the 80% leasing activity is unique and not double-counted, with strong demand for smaller spaces [76][78]

Financial Data and Key Metrics Changes - Core FFO for the second quarter was $0.59 per share, a $0.01 increase over the prior quarter when excluding one-time termination revenue recognized in the first quarter [9] - The company reaffirmed its full year 2025 core FFO outlook of $2.37 to $2.41 per share [9] - The balance sheet ended the quarter with over $1.8 billion of liquidity, including $560 million of cash and a net debt to EBITDA ratio of four times [11] Business Line Data and Key Metrics Changes - Executed 1.7 million square feet of leases in the quarter, with net effective and cash leasing spreads for comparable leases at 218% respectively [3][4] - Same property occupancy increased to 96.1%, up 40 basis points sequentially, with positive net absorption of 220,000 square feet [4] - Market rents across the portfolio declined approximately 3.5% sequentially and 12.8% year over year [5] Market Data and Key Metrics Changes - Leasing activity on approximately 80% of vacant spaces, up significantly from 60% a year ago [6] - The company sold two properties totaling $82 million, bringing year-to-date dispositions to $134 million at a weighted average cap rate in the low 4% range [7] Company Strategy and Development Direction - The company remains focused on its irreplaceable infill Southern California portfolio, which is expected to benefit from persistent supply constraints and strong demand [8] - The strategy includes capital allocation towards repositioning and redevelopment projects, which are projected to contribute an additional $70 million of incremental NOI [10] Management's Comments on Operating Environment and Future Outlook - Management noted that while leasing activity remains steady, macroeconomic and tariff uncertainties are impacting tenant decision-making, putting pressure on overall demand [4] - The company expects lower interest expenses due to favorable interest rates on its term loan, despite some delays in rent commencements [10] Other Important Information - The company has approximately $54 million of dispositions under contract, subject to customary closing conditions [8] - The cash mark to market for the portfolio stands at 3%, contributing about $20 million of incremental NOI to the embedded growth profile [10][25] Q&A Session Summary Question: Future repositioning and redevelopment starts - Management indicated that the pipeline is fluid and subject to change, with the Hertz asset being a significant driver for future NOI [15][18] Question: Cash mark to market trends - Management stated that the cash mark to market is currently at 3% and future trends will depend on market rent growth, emphasizing that growth is not solely dependent on this metric [22][25] Question: Capital allocation and acquisition opportunities - Management confirmed a measured approach to acquisitions, focusing on opportunities that meet stringent underwriting criteria and drive cash flow accretion [27][29] Question: Delays in rent commencements - Management expressed confidence in achieving projections despite pushing out lease-up timing by about one month on average due to current market dynamics [33][35] Question: Tenant behavior and lease terms - Lease terms have remained steady, with strong renewal activity and an increase in early renewals, indicating tenant confidence [40][41] Question: Market rent growth and volatility - Management acknowledged a decline in market rents due to tariff policy volatility but noted continued leasing activity and progress on redevelopment projects [44][46] Question: Cap rates and user purchases - Management highlighted that user sales have influenced cap rates, with current market cap rates in the low 5% range [50][53] Question: Occupancy outlook for the second half of the year - Management expects some deceleration in occupancy due to planned move-outs, maintaining guidance of 95.5% to 96% [55][56] Question: Conversion rates and demand - Management reported that conversion rates are taking longer, but the majority of leasing activity is expected to convert into executed leases [62]