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Terreno Realty Acquires MD Property – Analyst Blog

Wed, 17 Oct 2012 01:09:49 +0000

Terreno Realty Corporation

), a real estate investment trust (REIT), has recently acquired an
industrial building spanning 85,000 square feet in Laurel,
Maryland, for approximately $7.0 million. The property was
purchased from an unnamed seller.

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.

The acquired property is presently 100% leased to a single tenant.
The industrial building is strategically located in the
Baltimore/Washington corridor park, in close proximity to
Interstate 95 – the key highway on the East Coast of the U.S.
Consequently, the properties bring on board unmatched distribution
space for the company.

The estimated stabilized cap rate of the asset is 7.6%. Total
acquisition cost of the property included the initial purchase
price, the effects of marking assumed debt to market, due diligence
and closing costs, estimated near-term capital expenditures, and
leasing costs necessary to achieve stabilization.

San Francisco-based Terreno Realty owns and operates industrial
real estate properties primarily in six major coastal markets of
the U.S. These include the 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.

As of September 30, 2012, Terreno Realty owned 63 buildings
aggregating 4.8 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 92.6% leased to 97 tenants.

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 #3 Rank translating into a short-term Hold rating. We also
have a Neutral recommendation and a Zacks #4 Rank (short-term Sell
rating) for
DCT Industrial Trust Inc.

(
DCT

), one of the competitors of Terreno Realty.

DCT INDUSTRIAL (DCT): Free Stock Analysis
Report

TERRENO REALTY (TRNO): Free Stock Analysis
Report

To read this article on Zacks.com click here.

Zacks Investment
Research

Article source: http://community.nasdaq.com/News/2012-10/terreno-realty-acquires-md-property-analyst-blog.aspx?storyid=181923

Why Private Investors Are Staying Away From Mortgages

Tue, 07 Aug 2012 06:29:02 +0000

As homebuilders gain confidence and real estate agents claim demand is back, one would think investors would jump right back in for fear of missing the bottom. Investors in housing are buying up as many distressed properties as they can find, but investors in the mortgage market are still sidelined, burned by the subprime bust that left many of them with huge losses.

The private investor share of the outstanding mortgage market fell below $1 trillion in July to $999.7 billion, according to Amherst Securities. This is down from $1.8 trillion a year ago and $2.3 trillion at the peak in 2007.

“Since this is somewhat of a psychological barrier we are crossing, we naturally asked the question how long it might take to cross other benchmark market sizes,” wrote Amherst’s Laurie Goodman in a monthly report. “In the absence of any new issuance, we estimate the market will broach $750 billion in June 2014 and $500 billion by February 2017.”

The private investor share of the market has been dropping precipitously since the crash of the mortgage market, as millions of borrowers defaulted on loans, but even as the market now recovers there has been little to no new issuance.

Fannie Mae, Freddie Mac, and the Federal Housing Administration back more than 90 percent of all new loans, whereas they were barely one third of the market during the housing boom. Only Redwood Trust
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], which doesn’t originate loans but issues securities on pools of largely jumbo loans, is in the game and growing.

Redwood, a real estate investment trust (REIT), which has returned 33.4 percent this year, is now looking to get into the agency mortgage market as well, in talks with Fannie and Freddie to, “add conforming loans to our product menu,” according to a letter to shareholders. Redwood is also doing another jumbo security issuance in the third quarter.

Other players are reluctant to jump back in, despite the government officials’ claims that they are trying to shrink Fannie and Freddie by, among other things, raising guarantee fees. The FHA recently raised insurance fees and premiums, also claiming that it wanted to shrink its share of the market. Private investors still say government subsidies are pricing them out.

“It’s a combination of they’ve been burned by the subprime meltdown and don’t trust the quality and ratings, but equally important, yields are so low because mortgage interest rates are so low,” says Guy Cecala of Inside Mortgage Finance. “The only way to really revitalize the private label market is to take the government loan limits down to $417,000 again.”

Loan limits at Fannie, Freddie and the FHA were raised to just more than $729,000 in many major housing markets and then Fannie and Freddie’s were later lowered to $625,500. Meanwhile the Federal Reserve (explain this) is following an ongoing policy of exceptionally low interest rates, designed to keep long term interest rates in particular low. Mortgage rates for conforming loans have been sitting well below 4 percent, and even jumbos are near record lows.

Questions? Comments? And follow me on Twitter @Diana_Olick

Article source: http://www.cnbc.com/id/48531685?__source=RSS*blog*&par=RSS

Terreno Realty Prices Equity Offer

Fri, 13 Jan 2012 23:19:45 +0000

Terreno Realty Corporation (TRNO), a real estate investment trust (REIT), has recently announced an equity offer of 4 million shares at $14.25 each to raise cash to increase its liquidity. The company has also decided to grant a 30-day option to the underwriters to purchase an additional 0.6 million shares to cover any over-allotments.

The Goldman Sachs Group, Inc. (GS) – a full-service global investment banking and securities firm, and KeyBanc Capital Markets Inc. – the investment banking division of KeyCorp (KEY), are acting as the joint book-running managers for the offering.

Terreno Realty intends to utilize the proceeds to repay a part of its debt and fund potential acquisitions. Over the years, the company has resisted from pursuing ground-up development or land investments and instead focused on acquiring high-quality assets. The continuous acquisition binge is also part of the long-term strategy of the company to own functional and flexible buildings in infill locations that can be modified to accommodate single and multiple tenants at discounts to replacement cost.

San Francisco-based Terreno Realty owns and operates industrial real estate properties primarily in six major coastal markets of the U.S. These include the 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.

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 #3 Rank translating into a short-term ‘Hold’ rating.

Read the full analyst report on KEY

Read the full analyst report on GS

Read the full analyst report on TRNO

Article source: http://www.zacks.com/stock/news/67805/Terreno+Realty+Prices+Equity+Offer

Kilroy Acquires CA Office Space

Mon, 26 Sep 2011 12:44:45 +0000

Kilroy Realty Corp. (NYSE:KRC), a real estate investment trust (REIT), has recently acquired an office property in the South of Market district of San Francisco, as part of its long-term strategy to own high-quality assets at below-replacement cost prices in areas that provide strong near-term cash flows and attractive long-term appreciation potential. The company further intends to make certain renovations to the acquired property over time to enhance its value.

Kilroy purchased ‘201 Third Street’ – a 311,455 square foot 12-story office property, for $103.3 million. The building, currently 90% occupied, is strategically located adjacent to the Moscone Center – the largest convention and exhibition complex in the region. In addition, the property offers amenities such as higher finished ceilings, increased natural light and collaborative meeting areas, which are expected to better suit the demands of technology and media tenants of the region.

Furthermore, the property offers superior communication facilities such as the Caltrain – a California commuter rail line on the San Francisco Peninsula and in the Santa Clara Valley (Silicon Valley) in the U.S.; Bay Area Rapid Transit (BART) – a rapid transit system serving the San Francisco Bay Area; and the new Transbay Transit Center – a transportation complex in San Francisco.

With the latest transaction, Kilroy has acquired six office properties year to date in key West Coast submarkets. The aggregate cost of transaction for the purchase of approximately 1.5 million square feet of office space was $516 million. The company is also presently under various stages of negotiation to acquire three more properties for about $163 million.

Kilroy owns, develops and manages a diverse portfolio of office, industrial and multi-purpose real estate properties primarily in the coastal regions of Los Angeles, Orange County, San Diego, greater Seattle and the San Francisco Bay Area. As of June 30, 2011, the company owned 11.5 million rentable square feet of commercial office space and 3.6 million rentable square feet of industrial space.

Kilroy maintains an active multi-year development program focused on the economically dynamic locations characterized by strong long-term demand, limited supply, and high barriers to entry. As such, most of the properties of the company are concentrated in the coastal submarkets of Southern California that offer both a vibrant economic backdrop for businesses and a unique quality of life for their employees.

Currently, we have a ‘Neutral’ recommendation and a Zacks #3 Rank on Kilroy that translates into a short-term ‘Hold’ rating. We also have a ‘Neutral’ recommendation and a Zacks #2 Rank (short-term ‘Buy’) for MPG Office Trust, Inc. (NYSE:MPG), a competitor of Kilroy.

KILROY REALTY (KRC): Free Stock Analysis Report

Article source: http://www.dailymarkets.com/stock/2011/09/21/kilroy-acquires-ca-office-space-2/

Kilroy Acquires CA Office Space

Mon, 26 Sep 2011 12:44:43 +0000

Kilroy Realty Corp. (NYSE:KRC), a real estate investment trust (REIT), has recently acquired an office property in the South of Market district of San Francisco, as part of its long-term strategy to own high-quality assets at below-replacement cost prices in areas that provide strong near-term cash flows and attractive long-term appreciation potential. The company further intends to make certain renovations to the acquired property over time to enhance its value.

Kilroy purchased ‘201 Third Street’ – a 311,455 square foot 12-story office property, for $103.3 million. The building, currently 90% occupied, is strategically located adjacent to the Moscone Center – the largest convention and exhibition complex in the region. In addition, the property offers amenities such as higher finished ceilings, increased natural light and collaborative meeting areas, which are expected to better suit the demands of technology and media tenants of the region.

Furthermore, the property offers superior communication facilities such as the Caltrain – a California commuter rail line on the San Francisco Peninsula and in the Santa Clara Valley (Silicon Valley) in the U.S.; Bay Area Rapid Transit (BART) – a rapid transit system serving the San Francisco Bay Area; and the new Transbay Transit Center – a transportation complex in San Francisco.

With the latest transaction, Kilroy has acquired six office properties year to date in key West Coast submarkets. The aggregate cost of transaction for the purchase of approximately 1.5 million square feet of office space was $516 million. The company is also presently under various stages of negotiation to acquire three more properties for about $163 million.

Kilroy owns, develops and manages a diverse portfolio of office, industrial and multi-purpose real estate properties primarily in the coastal regions of Los Angeles, Orange County, San Diego, greater Seattle and the San Francisco Bay Area. As of June 30, 2011, the company owned 11.5 million rentable square feet of commercial office space and 3.6 million rentable square feet of industrial space.

Kilroy maintains an active multi-year development program focused on the economically dynamic locations characterized by strong long-term demand, limited supply, and high barriers to entry. As such, most of the properties of the company are concentrated in the coastal submarkets of Southern California that offer both a vibrant economic backdrop for businesses and a unique quality of life for their employees.

Currently, we have a ‘Neutral’ recommendation and a Zacks #3 Rank on Kilroy that translates into a short-term ‘Hold’ rating. We also have a ‘Neutral’ recommendation and a Zacks #2 Rank (short-term ‘Buy’) for MPG Office Trust, Inc. (NYSE:MPG), a competitor of Kilroy.

KILROY REALTY (KRC): Free Stock Analysis Report

Article source: http://www.dailymarkets.com/stock/2011/09/21/kilroy-acquires-ca-office-space-2/

BRE Properties Acquires 150-Unit Property in Lafayette, California

Tue, 16 Aug 2011 00:45:46 +0000

SAN FRANCISCO–(EON: Enhanced Online News)–BRE Properties, Inc. (NYSE:BRE), a leading real estate investment trust
(REIT) with apartment communities located primarily in the major
metropolitan markets of coastal California and metropolitan Seattle,
announced today the acquisition of Lafayette Highlands, an 8.2-acre
property in Lafayette, Calif. for $48.75 million. The community of 150
market-rate apartments is located in a San Francisco Bay area submarket
with high barriers to entry, high median home values and one of the
region’s top ranked school districts.

“The Lafayette acquisition furthers BRE’s strategy to allocate
additional capital in the S.F. Bay area. Lafayette Highlands is in one
of the most affluent and desirable communities in the area”

“The Lafayette acquisition furthers BRE’s strategy to allocate
additional capital in the S.F. Bay area. Lafayette Highlands is in one
of the most affluent and desirable communities in the area,” said BRE
EVP, Chief Investment Officer Steve Dominiak. “The community has an
attractive unit mix of more than 85% two- and three-bedroom apartment
homes, appealing to residents attracted to the quality of life, schools
and significant rent-to-own disparity in Lafayette.”

Lafayette Highlands was acquired at a discount to replacement cost and
is the only community with more than 100 units in Lafayette. The
property was acquired on an unencumbered basis with proceeds from the
company’s revolving credit facility. Lafayette Highlands is expected to
generate a first-year net operating income to purchase price yield of
approximately 4.8% and is currently 95% occupied.

Built in 1973 and fully renovated in 2007, the Lafayette Highlands has a
low-density design of 18 units per acre and an average unit size of
1,011 s.f. There are 14 residential buildings with two levels of
wood-framed residential floors above parking. The gated community has a
fitness center, outdoor pool and children’s playground. This
transit-oriented development community is located minutes away from
Highways 24 and 680 and is within two miles of both the Lafayette and
Walnut Creek Bart stations, with a 30-minute commute to the San
Francisco Financial District. The residents are within walking distance
of downtown Lafayette and three miles of downtown Walnut Creek and its
offices, retailers and dining establishments.

About BRE Properties

BRE Properties, based in San Francisco, California, focuses on the
development, acquisition and management of apartment communities located
primarily in the major metropolitan markets of Southern and Northern
California and Seattle. BRE directly owns 77 multifamily communities
(totaling 21,820 units) and has joint venture interests in an additional
13 apartment communities (totaling 4,080 units). BRE Properties is a
real estate investment trust (REIT) listed in the SP MidCap 400 Index.
For more information on BRE Properties, please visit our website at www.breproperties.com.

Article source: http://eon.businesswire.com/news/eon/20110815006445/en/BRE/acquisition/Lafayette

Kilroy Completes Secondary Offering

Wed, 13 Apr 2011 03:23:35 +0000

Kilroy Realty Corp. (KRC – Snapshot Report), a real estate investment trust (REIT), has recently closed its secondary offering of over 6 million shares at $38.25 each. The equity offer included approximately 0.8 million shares sold to the underwriters to cover the over-allotment options.

The company had initially announced an equity offering 4.5 million shares along with an option of an additional 675,000 shares to cover any over-allotments. However, Kilroy was later forced to increase the offer due to strong investor demand.

The company raised net proceeds of $221.2 million from the equity offering, which it intends to contribute to its operating partnership Kilroy Realty, L.P. The operating partnership in turn would utilize a portion of the net proceeds to finance the $100 million acquisition of four office buildings in Kirkland, Washington. The remainder of the proceeds would be used to repay debt under the operating partnership’s unsecured revolving credit facility and for potential future acquisitions.

Kilroy owns, develops and manages a diverse portfolio of office, industrial and multi-purpose real estate properties primarily in the coastal regions of Los Angeles, Orange County, San Diego, greater Seattle and the San Francisco Bay Area. At December 31, 2010, the company owned 10.4 million rentable square feet of commercial office space and 3.6 million rentable square feet of industrial space.

Kilroy maintains an active multi-year development program focusing on the economically dynamic locations characterized by strong long-term demand, limited supply, and high barriers to entry. As such, most of the properties of the company are concentrated in the coastal submarkets of Southern California that offer both a vibrant economic backdrop for businesses and a unique quality of life for their employees.

Currently, we have a ‘Neutral’ recommendation and a Zacks #3 Rank on Kilroy that translates into a short-term ‘Hold’ rating. However, we have an ‘Underperform’ recommendation and a Zacks #5 Rank (short-term ‘Strong Sell’) for MPG Office Trust, Inc. (MPG – Snapshot Report), a competitor of Kilroy.

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Article source: http://www.zacks.com/stock/news/51110/Kilroy+Completes+Secondary+Offering