Terreno Realty Expands Portfolio With Property Buyout in Redmond

Core Viewpoint - Terreno Realty (TRNO) is pursuing an acquisition-driven growth strategy, recently acquiring an industrial property in Redmond, WA for $9.3 million, with an estimated stabilized cap rate of 5.5% post-renovation [1] Group 1: Property Acquisition Details - The acquired property is located at 9660 153rd Avenue NE, comprising one industrial distribution building of approximately 33,000 square feet on 1.5 acres, fully leased on a short-term basis [2] - After the existing tenant vacates, the property will undergo renovation, reducing the space to roughly 26,000 square feet, and is expected to attract new tenants due to its advantageous location [2] Group 2: Portfolio Restructuring - TRNO is actively restructuring its portfolio by selling non-core assets and acquiring value-accretive investments, which is expected to support long-term revenue growth [3] - In Q1 2025, TRNO sold two properties with a total of around 88,000 square feet for approximately $24.9 million, and as of March 31, 2025, had acquisitions worth about $55.9 million under contract and nearly $16 million under letters of intent [3] Group 3: Development Projects - As of March 31, 2025, Terreno Realty has five properties under development or redevelopment, which will consist of eight buildings totaling around 0.8 million square feet, with 48% pre-leased [4] - The company also holds around 22.4 acres of land for future developments, estimated to require an investment of approximately $392.8 million [4] Group 4: Market Position and Performance - Terreno Realty is expanding its portfolio in six major coastal U.S. markets, including New York City/Northern New Jersey, Los Angeles, Miami, San Francisco Bay Area, Seattle, and Washington, D.C., which show strong demographic trends and demand for industrial real estate [5] - Despite these expansion efforts, TRNO's shares have declined by 8.8% year-to-date, compared to a 4.7% decline in the industry, reflecting concerns over macroeconomic uncertainty and tariff issues [5]