FUR Winthrop Realty Trust New (delisted)

Terreno Realty Corporation (TRNO), a real estate investment trust (REIT), has recently provided an update of the various acquisitions, operating, and other capital market activities it has executed in first quarter 2012. The company expects to file its quarterly report for the quarter ended March 31, 2012 in the first week of May.

During the quarter, Terreno Realty acquired an industrial property in Sterling, Virginia, for approximately $6.1 million. The acquired property spanning 69,000 square feet of space was 100% leased to a single tenant. The property is strategically located in close proximity to the Washington Dulles International Airport, and consequently offers unmatched distribution space to the lessee.

The acquisition is part of the long-term strategy of the company to abstain from pursuing ground-up development or land investments, and instead own functional and flexible buildings in infill locations that can be modified to accommodate single and multiple tenants at discounts to replacement cost.

In order to fund the continuous acquisition binge of the company, about 4.1 million shares were issued during first quarter 2012 at $14.25 each, generating net proceeds of $54.7 million. Terreno Realty also obtained a $20.0 million non-recourse mortgage loan at a fixed annual interest rate of 3.79%. In addition, the company amended its $80.0 million senior revolving credit facility to extend the debt maturity and reduce the interest burden.

During first quarter 2012, Terreno Realty owned 48 buildings aggregating 3.5 million square feet in high barrier-to-entry markets of Los Angeles, Northern New Jersey/New York City, San Francisco Bay Area, Seattle, Miami and Washington D.C./Baltimore. The properties were approximately 92.9% leased to 72 tenants.

San Francisco-based Terreno Realty owns and operates industrial real estate properties primarily in six major coastal markets of the U.S. Each of the locations in which Terreno Realty has a significant presence is characterized by a well-established transportation network – seaports, airports, highways and railways that are essential for the swift distribution of goods. In addition, available land in these markets is scarce, resulting in steep barriers for the development of new and competing properties.

We have a Neutral rating on Terreno Realty, which presently has a Zacks #2 Rank translating into a short-term Buy rating. We also have a Neutral recommendation and a Zacks #3 Rank (short-term Hold rating) for Winthrop Realty Trust (FUR), one of the peers of Terreno Realty.

 
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