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Rexford to sell $1.2B Southern California portfolio to EQT affiliate
The deal is expected to close by the end of the third quarter and is part of Rexford’s plan to dispose of $1.5B to $2.0B in non-core properties this year.
Rexford Industrial Realty agreed to sell a Southern California industrial real estate portfolio worth about $1.2 billion to an affiliate of EQT Real Estate, the company said. The Los Angeles-based REIT expects the transaction to close by the end of the third quarter, and noted it will provide more details about the properties once the sale is completed, according to Commercial Observer.
The sale fits Rexford’s broader strategy to unload $1.5 billion to $2 billion in non-core assets to improve its portfolio and balance sheet. Rexford said the properties included in the transaction have characteristics such as limited long-term growth potential, greater competing supply, shorter remaining lease terms, or above-market rents.
Rexford expects the portfolio to generate a 5.5 percent cash net operating income yield in 2027, reflecting anticipated move-outs and rent step-downs from current above-market levels. The REIT said it plans to use proceeds to pay down debt maturing in 2027, potentially repurchase shares under its $1 billion buyback program, and fund its redevelopment and development pipeline, Commercial Observer reported.
Including the EQT deal, Rexford has closed or has assets under contract totaling about $1.5 billion of dispositions this year and is in talks on additional property sales. As of June 30, Rexford owned 409 properties totaling roughly 49.9 million rentable square feet, all concentrated in infill Southern California.