Rexford REIT Buys Blackstone Warehouse Portfolio for $1B
Deal hands 48 Southern California properties with about 3M SF of almost fully leased space to the L.A.-based REIT
By Greg Cornfield March 28, 2024 5:15 pm
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The biggest warehousing landlord from the nation’s top market for industrial space just got a lot bigger, thanks to a major deal with the biggest commercial real estate company in the U.S., Blackstone (BX).
Rexford Industrial Realty, a real estate investment trust based in Los Angeles, is putting down $1 billion to acquire 48 properties with 3 million square feet of industrial space in separate deals with Blackstone’s subsidiaries. The industrial portfolio is located in L.A. and Orange counties, and it is 98 percent leased.
The deal averages out to about $332 per square foot. Bloomberg first reported the deal.
“These strategic investments in exceptionally well-located, high-quality assets within infill Southern California, the nation’s highest-barrier and lowest-supply industrial market, represent a significant opportunity to drive accretive cash flow growth, increased operating margins and long-term value creation,” Howard Schwimmer and Michael Frankel, co-CEOs of Rexford, said in a joint statement.
“Looking forward, our total pipeline comprises approximately $300 million of investments under contract or accepted offer, bringing the aggregate year-to-date $1.4 billion of investments completed or in the pipeline, to a weighted average 5 percent anticipated initial unlevered cash yield and anticipated 5.7 percent stabilized unlevered cash yield.”
David Levine, co-head of Americas acquisitions for Blackstone Real Estate, said the deal represents the strong demand for high-quality assets in Southern California, where Blackstone owns more than 50 million square feet of warehouses. Though it is unloading this portfolio, Blackstone remains one of the biggest firms looking for ways to build and expand in the industrial real estate space.
“Logistics continues to experience near-record-low vacancy and remains a high-conviction theme for Blackstone Real Estate globally; we are proud owners of $175 billion of warehouses around the world,” Levine said in a statement.
Gregory Cornfield can be reached at gcornfield@commercialobserver.com.
