Terreno Realty Corporation Announces Quarterly Operating, Investment and Capital Markets Activity

Terreno Realty Corporation (NYSE:TRNO), an acquirer, owner and operator of industrial real estate in six major coastal U.S. markets, announced today its operating, investment and capital markets activity for the second quarter of 2023.

Operating

As of June 30, 2023, Terreno Realty Corporation owned 257 buildings aggregating approximately 15.8 million square feet and 46 improved land parcels consisting of approximately 165.8 acres:

• The operating portfolio was 97.8% leased at June 30, 2023 to 566 tenants as compared to 98.1% at March 31, 2023 and 97.9% at June 30, 2022. Occupancy decreased during the second quarter primarily due to a 45,000 square foot (approximately 30 bps) short-term sale leaseback expiration at the Company’s recently acquired Long Island City property. The property was subsequently leased with a September 1, 2023 commencement date;
• The same-store portfolio of approximately 13.2 million square feet was 98.4% leased at June 30, 2023 as compared to 98.5% at March 31, 2023 and 97.1% at June 30, 2022;
• The improved land portfolio of 46 parcels totaling approximately 165.8 acres was 96.3% leased at June 30, 2023 as compared to 98.9% at March 31, 2023 and 97.0% at June 30, 2022;
• Cash rents on new and renewed leases totaling approximately 0.8 million square feet and 3.0 acres of improved land commencing during the second quarter increased approximately 59.2% with a tenant retention ratio of 51.7% for the operating portfolio and 0.0% for the improved land portfolio. Cash rents on new and renewed leases totaling approximately 1.3 million square feet and 8.6 acres of improved land commencing during the six months ended June 30, 2023 increased approximately 64.3% with a tenant retention ratio of 52.9% for the operating portfolio and 0.0% for the improved land portfolio;
• Executed a lease for 45,000 square feet in Long Island City, Queens, New York with the leading bike share provider in New York City. The property was vacant as of June 30, 2023 and the new lease will commence on September 1, 2023 and will expire June 2029;
• Executed an early lease renewal in Kent, Washington with a leading e-commerce firm. The lease of 158,000 square feet, which was to expire in January 2024, will now expire January 2029;
• Executed a lease for 41,000 square feet in Hialeah, Florida with an international logistics services provider. The ten-year lease is expected to commence in November 2023 upon completion of tenant improvements. Building 41 of Terreno Realty Corporation’s Countyline Corporate Park Phase IV, a 191,000 square foot, 32-foot clear height rear-load industrial distribution building, is now 100% pre-leased and is expected to complete construction in the third quarter of 2023 and achieve LEED certification; and
• Completed the redevelopment of Terreno Realty Corporation’s Berryessa improved land parcel in San Jose, California and executed a lease for 6.3 acres of improved land to host a City of San Jose program to provide unhoused individuals with supportive interim tiny-home housing and safe RV parking. The lease commenced on June 30, 2023 and will expire August 2033. The total cost of the redeveloped property is approximately $26.3 million and the stabilized cap rate is approximately 4.9%.

Investment