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Southern California’s fastest-growing warehouse landlord continued to expand throughout 2023 despite — or perhaps because of — weakening market conditions.
Rexford Industrial Realty announced it added two more industrial properties to its portfolio in December, including an empty lot, for a combined $69.5 million. For the full year of 2023, Rexford completed $1.5 billion of investments, and is set to close on another $75 million in acquisitions this month.
In December, Rexford acquired the 12-acre property at 600-708 East Vermont Avenue in Anaheim for $57 million, and plans to redevelop it into a 264,000-square-foot Class A building. Rexford also acquired the empty 4.7-acre property at 11234 Rush Street in South El Monte in Los Angeles County’s San Gabriel Valley for $12.5 million, and plans to build a 102,000-square-foot Class A industrial asset.
Additionally, Rexford said it sold the fully leased 38,643-square-foot property at 3720-3750 West Warner Avenue in Santa Ana for $11.3 million. Proceeds were reinvested into the acquisition in South El Monte via a 1031 exchange.
The REIT slowed its rapid buying spree — which included $2.4 billion in acquisitions in 2022, and $762 million in the first quarter of 2023 — amid a widespread market correction. But the firm continued to make significant acquisitions and investments through the second half of last year as part of its larger strategy of buying underperforming or undervalued assets in order to redevelop or reposition, and then raise rents or otherwise add value.
Rexford’s now-slower pace is in step with the larger warehousing real estate market. The rise in interest rates caused a significant decrease in U.S. transaction volumes, which fell to less than $45 billion in 2023 — well below the figures of $129 billion in 2021 and $101 billion in 2022 — according to the latest data report from CommercialEdge.
Gregory Cornfield can be reached at gcornfield@commercialobserver.com.
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