Rexford Industrial Realty (REXR) 12 Feb 212020 Q4 Earnings call transcript

Greetings and welcome to Rexford Industrial Realty Fourth Quarter and Full Year 2020 Earnings Call. [Operator Instructions] Please note this conference is being recorded. I will now turn the conference over to David Lanzer, General Counsel. Thank you.

You may begin.

joining call. Rexford for XXXX fourth you conference earnings thank us Industrial’s for quarter We

to press the Securities the addition today’s questions posted XXXX. on In contain the of website Litigation call, a close, after our as answers supplemental Reform we management’s market forward-looking remarks Act package to www.rexfordindustrial.com. statements Private in at Investor and section release Relations On distributed your yesterday in defined

cause actual statements and may Forward-looking matters uncertainties discussed those subject that to risks to results today. address are from differ that

For you any more Industrial and SEC we the information about update these Rexford statements forward-looking risk our to factors, encourage assumes filings. to future. XX-K review obligation in no our other

financial In information presented addition, non-GAAP certain call this represents on financial measures.

package of Officer, Chief an supplemental Michael Executive are Lanzer, our reconciliation earnings Frankel is General conference measures financial Co-Chief Howard release why with and non-GAAP to by Schwimmer, present explanation Financial investors. useful Today’s Officers, Laura Counsel. David and hosted Clark; call and and myself, GAAP Industrial’s such Rexford Our together

the some We open we will for your and questions. then make prepared remarks, will call

I the will to over Now, call Michael. turn

Rexford and call. importantly, families XXXX discuss financial then will hope activity, Laura quarter Thank welcome transaction and Most begin your healthy. results Industrial’s will XXXX. are our brief you earnings and Today, and for Howard introduction, you we well and I’ll to a fourth with cover outlook our

for the then will call open questions. We your

despite and Rexford the completed most Industrial outstanding on last our significant Although our the our globe, one year brought pandemic. at team within record across hardship of communities years

re-leasing entrepreneurial for The base basis. averaging of over about cash GAAP achieved our leasing itself. XX% team’s million volume with and the and XX% XXXX demonstrates of Southern infill experience exceptional a speaks feet strength California square Rexford X.X on record spreads, of We performance tenant team. our Our

X.X% combined with demand And for high A Our also acquisitions to infill share our drivers, an core benefits largest drove demand the a set nation’s and e-commerce with that and market investment Southern on range among staples unprecedented new industrial grew consumption demand imbalance, zone company. $X.X over combined infill California of our growth, incurable positioned the in incremental these from a tenant factors, strong aerospace public incremental of fact XX.X% model, growth our basis. have market to publicly adoption These to consider sectors is in logistics levels. combined our with XXXX electric When total serves drove a return shareholder volume understand watermark tenant of why is of substantially a pushed internal easy outperform. which and consumer acceleration supply-demand vehicles, our about it since infill exceeding to initial the our in per from increase America. generate we others, REIT dramatic entrepreneurial any enabled shareholder billion of FFO, total through offering, traded while the XXX% business return of to Rexford other sector-leading healthcare XXXX

of of in rate the rent compounded average comparison, the way greater for recently indication, by Southern to for with strength. volume CBRE the rental CBRE Los next nation’s growth been company respect the the We opportunities. we outside forward, compounded major over Looking is bright. By X study same positioned period. X.X% same external growth the Angeles X.X% of LA. annual XX% has years, California better quality of growth the Rexford’s internal of and other projects markets see our believe X County growth to equates never future continued and annual years rent way Meanwhile, projected which next over Greater

investment-grade We to by beyond Southern accretively market become grown X.X% States market substantial opportunity industrial in the fuel to California low performance continue company to gratitude have we our United expand thanks resilience, proprietary our business, as our that, to the sheet is our all to further the would pandemic leverage your balance pleased intend increasing challenges. determination with process and our logistics fragmented unprecedented as our the extraordinary our share positioned the express Rexford deep to data maintain within pipeline. to I extraordinary leveraging well operating and performance turn our market. Above drive and into infill enhance also of technology, spirit growth And improvement capitalize am reflects entire margins years. REIT we very else, to and over third-largest well we portfolio grow for to acquisition team financial We deep related to The operating face current future leverage see Howard. Although Rexford scale our to great we upon the team. capitalization, as in like our call we

for us and remained Southern market highly Exceptional fundamentals and economy a COVID-XX infill decreased our through joining in persisted industrial demand though everyone our throughout Thanks, shutdowns markets, its and activity. driven diversified variety by associated a fourth within California Michael sectors you Vacancy quarter. today. dramatic and strong, continued increase e-commerce thank the of

and healthy As absorption. strong result, continue rate we to net a rental see growth

ended pool Inland our the indication representing square increase X.X%, of an same-property of reduction quarter. at year markets, ABR a Empire our low year-over-year. strength the of California target prior ended of per Southern from XXXX way $XX.XX the historically By X% foot, Our at markets, point XX of which the basis exclude vacancy East, of

year. expirations at on the for in throughout these and position basis square a expirations. square grow cash on continue XX% a XX%, At on During to we address these NOI XXXX leases were feet GAAP early in million fourth new renewal us leases year-end, putting over of basis. a mark-to-market X.X had we approximately feet XX% these About of half is The XXXX. X.X to as expirations the approximately remaining strong renewals and quarter, we about million leasing spreads of lease completed of

external feet portfolio. completed growth, quarter, fourth we XX X.X approximately totaling during $XXX our to adding the million, to XX acquisitions million properties and Turning square

of year, these acquired properties, and XX.X equating we billion included square the redevelopment, site improvements million feet to $X.X full Seven land acres X sites with acquisitions storage the XX% for to For outdoor coverage. low totaling of coverage, portfolio. adding

Our and acquired investment our transactions, activity sourcing of through truly lightly demonstrates the XX% marketed with, unique our off-market strength To market of begin were platform. or research-driven relationships. originated XXXX proprietary methods deep about investments operating our through

in generational long-time XX% In of owners these in transactions, increase acquisitions. have capitalizing and represented as are we achieve upon value-creation to the to active allowing seen exchange Consequently, management Further, company efficiency. of value-add better Rexford, the transactions, repositioning which contribute a for a substantially deliver strength XXXX seller than owners property almost tax continues demonstrate management. yields. an our in Additionally, expertise our asset institutional Recent we capability. shift ownership stabilizations to historical of age out their in ownership repositioning increasingly UPREIT tremendous

we full greater rates square the yield projects of repositioning average year or For of approximately cap marketed weighted represents basis to un-levered at XXX,XXX feet transactions. point on XXXX, XXX an premium a stabilized comparative cost X.X%, on which total

X currently feet another ahead start the we to look XX approximately million over months. approximately we repositioning square square in XXX,XXX redevelopment next or feet under XXXX, As have and

lease-up Given rent for optimistic strong markets, projects timely our the growth we superior potential industrial are creation in strength delivering of demand and through this for value highly of space functional year.

in dispositions, value and expect capital. to continue sold assets recycle opportunistic $XX.X XXXX, basis we million unlock to on properties, we Turning and to of an sell to

and $XXX are XXXX latter that respect targeting opportunities. with we million This acquisition announced the close on are in have includes under of we closed or transaction of have we to acquisitions to of well investments, positioned we million new recently Finally, LOI to $XXX the year-end, year. million the half approximately Subsequent contract. $XX

are completion of diligence and acquisitions Of are customary conditions, to due satisfaction guaranteed. subject course, this which closing other of all not and

provide are will as completed. over more We call the pleased now I to am details Laura. turn to transactions

begin and Thank around operating financial strong details today our I will you, results. with Howard.

basis, of stabilized than projections XXX NOI year. same-property of collection bad the The billings. occupancy, reserves driven contributed by of growth year, range. growth grew of the in XX.X% collected at full year was up billings for cash as pre-COVID by same-property full includes collections deferral the to to over in NOI quarter which GAAP XX.X%. basis ended expectations of billings. share points which debt at NOI leading X.X% a For ahead levels primarily as quarter, COVID-related $X.XX or X.X%, guidance by of near the share, Consolidated basis strength be outperformance fourth our per same-property of tenant X.X% deferral revenue a our better Overall to In collections at on in stabilized driven also strong we on and contractual up X.X% XX% continue the exceeding XX%, FFO strong came base continued our core per came

during about reminder, year, $XXX,XXX of our experience per returns. of a million delivering averaging X.X% we date, are total an this the the of pleased remains With shareholder executed be share, very deferrals Board collection. As the probability of strong representing to based collected $X.X on feel to of to performance, rent. superior XXXX XX%, months dividend commitment Rexford’s increase continued $X.XX demonstrating revenue, to X.X or and in we we good a declared announce that total

driving activities, maintaining growth a balance low Turning a superior at balance fundamental sheet now while remains Rexford. our financing best-in-class to focus sheet and leverage

November, and program, offering, our shares of senior upsizing XXXX. and we our on coupon to the capacity Proceeds million investment our to we leading net investment adding At debt the maintaining leverage secure term in million were were additional array ratings activity During quarter, November, fund demonstrated issue the to repayment loan from to funding existing target we a capital that quarter, bond ATM investment of of included ability year the our to million our low In raising in inaugural to our Moody’s completed sources, our robust forward in public range activity low total X S&P, we In and a with both Xx, leverage. $XXX used diverse at while notes pleased our $XXX the X.XXX%. end successfully access of coming Fitch investment-grade to sector due renewed end, rating. was EBITDA of grade of X.Xx. our early basis. to a was Also $XXX XX-year

During common average secondary we the equity of a the shares million. representing $XX.X $XXX.X exercise raised of an offering $XX.XX price of In option share. million price through ATM the a of program million of per proceeds underwriters’ the including of net X.X share, quarter, at $XX.XX per stock, we completed December, at of

and revolver $XXX no strong liquidity full XX, $XXX until very available remain a ATM cash on December of our $XXX with of we million million XXXX, approximately position, in maturities As approximately had We program. hand. on debt million our under availability

of to Before to FFO an call in I’ll for per over our practice, prior a year balance guidance. our questions, we with that It to per share to represents X%. our on is activities disposition the include XXXX of be guidance turn growth This of is yet the Company note date. sheet expected range your $X.XX acquisition, full earnings provide that overview core share $X.XX or consistent share. X% closed have not basis to not important of does

of to X% same-property Our in year a factors; first, and next, expected core X% basis; full cash to stabilized NOI range guidance X% basis to be on key a occupancy by to is growth GAAP the is on range XX.X%. stabilized several supported FFO average XX% of same-property X%

We be and is the are equity of related tied range Approximately expect to to company’s $XX.X which the million million. units compensation, $XX expense non-cash time-based to performance-based to performance. that includes $XX.X overall G&A in

$XX of share package, per Operator? roll prepared is to can questions. now of details find the Complete this million. you additional growth. remarks, hope your completes supplemental components This million and of guidance where found expense we also interest net forward included guidance helpful. We will be financial our have $XX.X detail our welcome XXXX Finally, in our a we earnings

is question with America. Feldman Thank Bank [Operator first from of proceed. Instructions] Please Our you. Jamie

the and you ‘XX the to that I same-store ask – talk Thank assumption starting in outlined, next well, I’ll about first, FFO? And out, then question. just back answer and your debt the you. in you guidance bad I’ll then can outlook let going guess you

Yes. Jamie, to hear it’s today. you great from

XXX year. the XXX XXXX full implies to slightly XXX expense for point So was the for better basis debt basis in year. a line than the guidance our XXXX range to Roughly points in our which bad full

to given defer know, there our as lifted. the is right tenants timing around – As have this of the remains much unilateral rep, environment, uncertainty you California the moratorium the in reminder, Those will a particularly watch and debt moratoriums, being moratoriums about the trajectory bad the the to half moratoriums. are bad those significant tenants levels following is XXXX being have on of related impact of of of our timing lifted in will that as most list debt this

Okay, thanks.

So are healthy, is to half tenants you paying you because but mean don’t have they tied think not to?

absolutely. Yes,

we last So I and pre-COVID collecting rents our financial confidence did don’t anticipate quarter, from to their left. Collections tenants were But good certainty, begin that picture these note reserve near operating, and we is big debt. have rent bad but paying are but AR They to bad when close important our not that this so – the about in minimal. to mean, open, majority are pretty and we really level that’s who are our of vast are as moratorium. XX%, quarter a talked about of pickup tenants the We that tenants. of is number related really debt health. this in have outstanding they And following half we rent we’ll moratoriums are paying of the that tenants are level, high

submarkets? might Do on lift across your any when you Okay. latest have thoughts moratoriums

Yes. That’s a really...

Jamie, David. this is

end moratorium by the the locality that so orders governor basically place. is the of action extended have March. And this own through statewide-enabling in the to And allows their was each

we’re had we been initially XX tracking. that XX of those, so about rescinded. And And have

in lifted, the county the So both impactful many for have orders effect. however, and LA, most been which already are the still of city are

there’s order extend who the it’s And that extended order several governor our that for the long very this, is allowing is governor’s the it the as would already place. to as And orders potential still in remain again. expectation so likely times the before has

‘XX? delivered how and when debt you then guess deferred you you your and what does projected in about And Okay. what think both ‘XX same-store for rent impact I rate bad growth

we in I terms Certainly depends XXX in rate. to Yes. projection of point the that on for come of terms I – range. it XXXX, where mean, growth the mean impacts basis XXX in,

XXXX – PAT. terms In for same-property XXX for that to basis of was growth of number points year, in full the impact about is the

So point a is ‘XX? drag basis in it XXX

our point to growth, a was basis it Yes, XXX drag yes.

to So be X% is ‘XX, X% just to clear, that what in cash normalized? like think you the do like

Yes.

spreads. terms So in that cash cash GAAP of versus same-property the versus

variance. half XXX and of basis So COVID for repayment account about deferrals the point

is to So our X% cash in property NOI guidance X%.

is X% X%. So about – and our GAAP to

XXX So basis points. that

collections, So say, about it’s cash deferral ex and on to COVID a X.X% X.X% the basis.

how me, then pipeline, Okay, talk the alright. acquisition And finally about OP for overall about percent just as you you deals? today? what think it unit be looks big And can might

let’s Howard. or talk about said, group, – have age. were contract. really the of of on many that hear toward now. Hi, what are really making life they’re for the million really years be well doing we deals And to decisions. during efficiency owners, UPREIT upgrade their comment LOI play, can’t makes call That the transactions. And we tax to announced, them all that, transaction. we tremendous in until transactions. their more you’ve announce that that we from what about They heard the is major optimistic estate much OP into XXs audience Jamie, We you. it, under There Nice it’s around exactly planning. up continue heading but we’re about people I did year might $XXX really And don’t talk Well, us

we But So strong. talk the about is otherwise, we’ll that be to optimistic are more pipeline able very those.

the terms week, heat some show those months behind track, the before of $XXX million today, of probably the in of of that The $XXX we’re worth we top how was. half the was month, sort the of of maps LOIs. product terms of you year there line offers LOIs. $XX pipeline I’ll example Last top terms square the of that give we valuation XXX of X And year, that feet product. the properties list, about tracking. of of X X seen, you’ve made those in I That’s of think deep between amount I what million you an in on is billion

the is pipeline growing. So

and So and do at obviously, these which getting off-market-type is year better growing. on us the differentiator And what set catalyzing we out, just marketplace. for in is in really we’re year our transactions, opportunity we focus the

Michael. this I that. just Jamie, color is add to wanted to some

If the you understand a this they many opportunity. decades, industrial other put one yourself from dilution consider infill by look very they those an other focused country in cases it’s market UPREIT REIT know truly we it infill no on is many country own these appreciate Southern demand resident and and There another repeatedly REIT have far. relative already in And across at the quality a owners solely They market with that’s market. in in of entire terms market their the what shoes what And California Rexford, that’s for are to hear long-time Southern of in diversified the country tenant owners, when they strongest any and they represent presence unique would to they in long-term is owned of is California. the fundamentals. because

to And demand as XXXX the forward a the we Rexford potential incremental is could so for the think, that for towards the tax a we happens, code. that’s really role to really, move if is other factor be solution And unique And play removed exchange them. that tax going from UPREIT. treatment the drive

a in otherwise solution the virtually the for a with UPREIT monetize of and tax-deferred on to only go structure haven’t continue that basis be they survives, we of Rexford. the manner and folks growth one property value because the heard the So it will

range opportunity forward. going pretty overall we’re So for reasons, the of excited about a

for Okay, thoughts. your thank you

Citigroup. with Emmanuel Our next question from is proceed. Please Korchman

everyone. Hey,

that your or you guess based tenant sort assets design translated average lease by be happened mix can time, buy? or been size I up. size, of over Is that have it has on the ticked has to to just average able of Just

a industrial think multi-tenant and was has do there a lot could at tremendous I full people And we And buy time value. with fairly selling at is multi-tenant to been assets we’ve Manny. Well, to is attractive discount. today, buying, the where a

So you of that lot of a type don’t product see type of – us product anymore. those buying

multi-tenant off And is bigger that also sold have buying size average growing. obviously, those assets we’re the so We’ve as because tenancies, well. of several tenant projects

So that’s too. had impact, an

average and that’s about about now and think from XX,XXX average up – in feet, we moved is I if size was think XX,XXX lease I today, size the the look I square even leasing quarter, portfolio did, the our the last previous, feet. think at you

Right. you’re based Is inflationary just the on just a making guys growth is just you ramp. as year, equity G&A into a at And company? natural other growing G&A are looking are as it’s and that that or then next big pretty where investments there

Manny, Yes, it’s Laura.

you’ve really year, base of our seen, over assets year As you’ve X in the prior market experienced years. last XXXX of robust full in years our added to we’ve seen, over alone, portfolio. And all capitalization the billion $X Last nearly as growth asset the we’ve overall XX% few and grew XXXX.

a out we platform. about our relative XX.X% the of certainly think note revenue, important average. I’ll time, our G&A I growing trending that not kind terms think comparisons the in G&A pace. It peers at our at direction, are to the completion is the peer may in same be makes believe certainly and same more was the of closing where difficult it’s we’re the of to the that gap we building nearing which percent in right So, XXXX, relative to about of as

in built platform. level non-cash So about cash $XX.X million to tied out to well our that see near-term our the we this to that a the compensation in of other compensation we’ll is compensation. and our of as as performance decline non-cash our the note G&A we out is G&A performance. of One of G&A of expect is is – terms Much begin some will overall bulk do company as our ratios related

level max achieving a related assumes payout of guidance us to performance. our So max

is most this we we’ve G&A don’t the max to provide projected that guidance. guided But that these won’t all said to. levels, way So if levels perform conservative of we believe these being achieve at we

equates as G&A Just versus a $X to we target an XXXX performance if cash reduction performance in that max of example, the in achieve nearly million.

Michael. is this Manny, And

is of part, much Not that’s very of sort other around the think making look is on you you way close grows G&A. are it But growing representative we in And incremental sector. I think still drives give only I I no that I investments make, the Rexford quick anything examples. industrial I’ll growing. REIT just think company, unique a we question might at there’s return that in think your I that think a the we incremental are to case. G&A part investments couple interesting if a of within do our And be, that the absolutely also

you So our investments marketing the originations you return of you make, transactions just industrial I in on about look that and sort sector instance, a last that, the And – very and quality is if XX% team depth of, then investments were of terms of team, our and say, have a dedicated I at dedicated that research would of a by we’ve size that probably billion acquisitions year expertise And than team made for capability. any if in an mean, and at look other the of full at we’ve institutional $X.X and system investment, leasing REIT – economics transactions, in enables yields and think in different lightly most look that we looks we well, workflow you invested marketed have been created who’ve and us marketed a seen better you to result similar side. in you pipeline the that with phone And of investment, of tremendous to substantially drives type workload. return equity our on off-market on – turn, return on incremental if just direct drive us – then which, investments, acquisition And and as typical – met the all on transactions. a And they investment. at And that’s and digital. it and volume through I system, compared have XXX% look which were substantial.

at handling Rexford and that’s spreads And XXX% the volume try out squeeze of we sector-leading year-over-year. activity all digital. the operate how growing we in still internally. company And why driving record for take leasing see a approach volumes our latency you how system. So of to Rexford is customers service we the And us the leasing and we similar

that’s it’s G&A, and going So company does it to including very on but ramifications, that hire focused people innovation, the ability a growth drive our has to some incremental fewer of the long-term substantial proportionate forward. very

leverage So – prepared we we substantial as I through company remarks, the my really see as building grow. we mentioned in operating

a Thanks for like looks of midpoint given to the one a it the just those occupancy and average me, that just Is on sort is year? turnover for as normal decline it going of anything that sort results. question absorption that, or into this there final that was XXXX, Michael. number And ‘XX you may guidance, and specific similar think expire is using more justifying if with that

Manny. Hey,

have change note to average now occupancy our end occupancy want number year. guidance for and this year I First, the in occupancy on is our full our guidance Previously, year. a guided we

for hopefully all. metric you in directly more NOI is think I is helpful this and reflective

comparable the XX.X% the XXXX XXXX, So for in average XXXX. occupancy was pool,

occupancy. in mid-point XX.X% to So XX% our decline guidance around of point basis a the implies XX

remains. we’re there’s of uncertainty feet strong about lot demand, And the activity, And expiring great X.X as leases a still seeing in as total square blocking million and well. does XXXX. continues, pandemic We of tackling have while that

we point, our this is that feel at prudent. yes, So guidance

Thanks, everyone.

with Our Please next Rodgers question is proceed. from Baird. Dave

kind this spreads Can what Michael, quarter. developments kind rent three underlying in overall, leasing the any now or over quarters, of changes you four the market? trend you’re about – talk underlying last growth everyone. about of Hi, back Yes. the that seeing market talked again you kind looking or of

your it sorry, Hi, yourself could David, if closer a mic, were you take if don’t mind maybe little I was the but repeating just I’m really there. to you breaking wouldn’t and others up hear, know –

My apologies, is this better?

better. Much

back Alright. were spreads guess really came leasing I it your to strong.

just and mentioned underlying moment I kind trends of of that more underlying get wanted at You the markets. ago, rent the but a the economics growth of to market

can worst market it Now of an trends update three, that give you now are? through more the quarters seems and normalization, look pre-pandemic four be of on much kind from of to back kind where the what us

Howard. Dave, Hi, it’s

I today I tell think you the reforecast now is I’ll quarter. rents. our boots team what of doing terms weekly. that short to we We astounding rents see ground there nothing each buildings. in are typically rents it I’ll Inland you park it’s great space and on West. XX growing such quickly. for seems be There’s unbelievable. XXX,XXX give demand square There mean We the on just of is a so foot a The construction finished Empire example. just in

the were. or leased changed just year. about XX% our about above or think couple month. end X And That literally and up rents are what about the And about signed, at we’re signed to the XX% with leased buildings. past within some space rents that $X.XX in now market XX% leases of assumptions was XX the a and have spaces be rather We $X.XX XX you’re of rent I talking

terms hard to growing on garner different pretty that many it’s look and now in So quarters just is of There the market that in so back prior uses industries just are coming businesses some well. existing and right into from trends doing that. are

versus separate trying their bit from for selling even doing warehouses You’ve distributing that e-commerce There’s of are Amazon just leasing themselves. through got amount now having tremendous to products we’re that a impacts. or companies a in Amazon the carry their

to exciting. When just seems lot where projections, now. it’s markets. growth it It’s look the blocking right this and things really high a the go ground single-digit and XXXX rent are a of things brokers So of see talk of you where on interesting at to for it’s most be to the is tackling lot And going like year. in headed

rental predominantly about have the the Howard, also Howard, leases want – to really that bumps. annual Howard, give relevant And think the have – increases most in for want chat that’s terms respect? our to a where on that. our that rate you to just going I annual that is market we you year-to-date of do to see to you where unique thing in for do them. part, sense One do want activity

leases. them. kicked X.X% than delivered. Yes. just rents faster there X% traction you just There’s growing in starting X.X industrial high type all premier leasing We’ve Midway complex a a in the of per the now over have the some on Inland park it. increases across are board have we dock we’re in we foot really and up X% doing selling there. Empire that with The push space to on increases terms and we’re I million then real have renewals we mentioned the to park annum of leases And in square All West the

effort a growth think other at are this making so ahead. we of we And push implemented product. this So really, rolling year, stronger and the to out I big our all beginning that of the

to they’re out really from outside your is of at just tipped XXXX couple in a guess hands that one volume to follow-up going obviously, then acquisitions, last competitors much of last then above in acquisitions out? time, there the by on some business And of maybe X acquisition the back. that? get levels what’s how is the year’s increase the being have or quarters. a might And been same have And And just big coming for geared do at may really some fear people’s driven great. That’s to wanting economics that or now early of I of stop question just in anything maybe took the years,

really ultimately where for We the said, predict. hard we we earlier going acquisitions year-to-year, initially a guidance slowdown pandemic. high go, – just were That can’t have predict the pause. to million We on occurred And throughout had I might really we of in start is yes, a pipeline our the to year. don’t just can’t fourth differently, bit, A at right, the were the Well, we the But most of acquisitions $XXX what’s because what certainly predict worth on sidelines. We people still happen. we we offer the but thinking acquisitions. deep. but It’s in did year, a again, active of happens you’re mentioned and hopes lot certainly earlier, have of quarter.

you. Alright. Thank

Tan Our is next Sarah with Please from proceed. JPMorgan. question

Sarah Hi, Mike for is this Mueller. on

two for questions me. Just

the cap The impact you the increased same tell chasing for seeing? And tenant? could first you on you also could it competitive is and the on prevailing the you’re one has on one are a rates assets that your and second the is bit productivity going landscape. that’s about And capital comment me

want take first Michael, to and one the the then address you I’ll maybe ports.

the our acquisitions As to the we’re have sectors far on transactions a limited marketed industrial be, Michael of as more competition size earlier, deciding in out our really access to and marketplace, lot seeing and They’re a to place breadth that of team. of be but they other some going capital shifting certainly of great focusing the market. is described

truly don’t amount and we in the marketed LOIs compete lightly some of about write anyone a year. on few focus earlier to numbers I And against or is off-marketed model really where business people. we gave transactions very Our

of they’re I to buying right think not or We we’re whether could be It competition. some down be just our to product. on in inbound gets lot or greatest different we that we criteria whether buy. to apply able pass really just more the own underwriting a opportunities

market the to There business the there’s we’re been though, access a best country The market. Southern to lot own that hasn’t in accessing differentiated product. the So no in always of we’ve difficulty, us for a capital market. unique allows years California. one been created just And that a There’s the secret. really is industrial

briefly just on maybe And ports. the will comment I

strong year, amount being we We the but underlying record of second substantial surge just have saw consumption year. market, for for half the up a port pent-up volumes to the consumer – the compared seen also demand. tremendous the and obviously, – demand XXXX. reentering in And In sort reflecting really we X% part, of year under a of

Net-net, by some the by is is containers extremely ports. elements see one driven resolved. partially California one we Southern healthy the that, We’ve that. in and peak we the labor distribution So anchored of uncommon. and longshoreman pandemic-related port, through we which reminder, backlog of And offshore, and important a seen of California, of predominantly LA consumption. is prior see are at a position by working periods, number Rexford volumes continue shortage way, not there’s at ports which Southern Beach, in being offloading largest the they’re that a periods. that as And ships backlog the the caused number two through in the to of country, and There’s substantial portfolio infill ports Long

to which more of not periods, to or They prior tenant we disruption how the actually this disruptions ports can’t in one locally consumed regionally. figure through seen imported those get upwards They the have the and goods are our believe like depending demand. when out research, So ports. in upon X seen in ports, we’ve XX% And through would it probably get goods.

within base a they’re to And locations, logistics, in tenants and changes that volumes trends, key the global by big as a it’s shipping non-infill going so consumption that’s for demand etcetera. tenant our port driven regional – some be driver of or our to disproportionately opposed box

Thank you.

[Operator proceed. Instructions] Advisors. Vince Green is Please with next Street Our Tibone question from

Hi, good morning.

repaying some costs your maturity Given thinking to and offering, bond about of of extend of overall ahead lower order recent in debt the are borrowing you early, how the your existing success maturity profile? potentially

industrial for welcome Hey, joining the today, coverage. and Vince, Thank it’s Laura. you sector us to

debt rates we investment-grade the very and really profile. today, our certainly of maturity At market are the the So profile evaluating constantly on very strong day, attractive. end in we the a is maintaining especially are focused

Xx the ended low of current year the debt-to-EBITDA we a net range. at low our with are at We – end

we I are to very and So mean, it’s as constantly rates evaluating attractive. – continue it said, be I

maybe the there that’s prepay something thank or swaps, due, kind term coming of be No, would you two clarify like is But going without penalty to for some debt you follow-up, that. those there or next that to there? the are pay could you just the are if facilities unsecured loan real cash outflow

– is we termination a are there incur. is charge but There they Yes. that swap pre-payable, would

as more some you deals think just your for Thanks. a described how core, add. you’ve it. the acquisitions, plus, curious value I core Got me, in different past, know I’m the of One in return to going you between would be about – different each? your maybe were the mix threshold And total, the those how if rough for acquisitions what XXXX buckets? would just you categorize

out we between Hi, Vince, When turned year frankly. able to or we’ve core land even predict core bucket years, in to mix buy be that we – which pleased it’s many a than will at of that of XXXX terms it look don’t many, plus. you we’re acquisitions, to Howard. were we first all, the or able year-to-year been core what more value-add in with, can’t look really like Well, real

that of a types projecting for we just of closed of was you look add. the page, projects. very yields the Interesting are point I’d and total of repositioning for value-add value for the XXXX, of really yields, cost terms achieving in on at where some half repositioning like are to our if below the return about lower similar, So XXXX. some though, transactions X% both we’re terms both acquisitions million. bit projects, you redevelopment component in we’ve And those of $XX the And transactions announced

that our get assets marketed at clearly, see investors the trading hands creating market. there’s you amount value a we’re clamoring of product sub-X the on here So are to and in their growing today, marketplace in a yields stabilized huge that to

some color that, in – the to our of portfolio the go-forward little XX another recent to portfolio, next more add And of – over million from million growth me as assuming were year acquisitions is buy third we NOI that, asset, generated looking and terms interesting asking $XX you roughly that NOI on third look that’s even XX embedded about. be we’re Probably, – at and in more core plus a months. incremental the the over last years, that lease them repositioning of XX.X% just And projected, in are embedded the NOI to basis, assets – expected to also $XX if those roughly almost yields add more we full stabilize QX in that growth from activity XX coming just a alone. over to we color is up. you current of type derived of little that current didn’t value-add is a potential to and a to well that But embedded

of scheduled but but about. you forward at have. that investment look positioned is if And interesting driven company that it’s asking think balance it’s So are impacts incredible really the by the of I sort well are investments these the activity to you really

more color. Thank quick one follow-up, just could. That’s I great Maybe if you.

in or there much you returns? take how Just market this stabilized will in want value-add – good you is any terms repositioning the that of future your think before hot, good of caps do portfolio or think in the it’s it’s deals you a you’ll deal kind deliver

whether not one, the heat let primary Howard address otherwise. But are cold, We the the our I’ll low drivers high don’t the that. in discipline, it perceived our a perceived address I’ll criteria at or the at investing investment value. market really let whether terms activity. or of hot look Those market. of is stock deals Number trading is of Howard

our going design terms past in we’ve rebuilding Yes. the say, the XX the grow growth construction company teams No, spent and our I just at to was months to capacity. of

So team. we have a from some literally now highly architect licensed very prolific we this firm. And that have architectural seasoned members industrial on came

handle we So we’re projects right up. And the in terms now. gearing of more that we’re actually bit a doing can quite

of So we’re achieve pointed already aspect it’s business. to able an And that type yields through that work. the of the exciting I out,

be of even we page. grow seeing component to essential currently to able an do you’re repositioning it’s we what do, on our and more So than and hope

Great. time. Thanks the for

Thank back question-and-answer remarks. closing session. for our you. to over turn This management call conclude I would does like to the

thank wish months. the X and for today. connecting in of again, behalf support and on about well hope interest you and all. for forward Well, Industrial to everybody to and want your team, and in entire to want you tuning Thank we healthy, We we your look Rexford. I soon of you families for we for vaccination Rexford thank

today’s does conclude This you. Thank conference.

thank and time at this your lines disconnect participation. for your you may You