Elliott sees opportunities to create value at warehouse REIT Rexford Industrial

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]