Rexford Industrial Realty, Inc.
For the period ended Mar 31, 2026. Filed Apr 28, 2026.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Mar 31, 2026 · Filed Apr 28, 2026
REXR$37.80-0.9%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-09-30; filed 2025-10-20.
0001571283-25-000054
Management’s Discussion and Analysis of Financial Condition and Results of OperationsItemCurrent report: 10-Q
Period ended 2026-03-31; filed 2026-04-28.
0001571283-26-000020
Management’s Discussion and Analysis of Financial Condition and Results of OperationsItemThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 136 previous paragraphs and 128 current paragraphs.
58 unchanged; 56 reworded; 14 added; 21 removed; 1 previous and 0 current paragraphs rearranged.
Tables are not compared: 7 previous and 7 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (14)
Current report
Management Update
Current report
Effective April 1, 2026, Laura Clark assumed the role of Chief Executive Officer and John Nahas assumed the role of Chief Operating Officer, as part of the Company’s leadership succession plan announced in November 2025. Howard Schwimmer and Michael Frankel ceased serving as Co‑Chief Executive Officers effective March 31, 2026. The Company continues to execute on operating and capital initiatives announced in connection with this transition, including changes to capital allocation priorities, a reduction in development exposure and enhanced operational rigor and synergies.
Current report
Repositioning & Development
Current report
Share Repurchases
Current report
In Orange County, vacancy increased quarter-over-quarter to 5.4% and average asking lease rates declined quarter-over-quarter.
Current report
Acquisitions, Dispositions and Value-Add Repositioning and Development of Properties
Current report
The Company’s growth strategy remains centered on creating long‑term, per‑share FFO and net asset value through disciplined capital allocation, targeted industrial investment within infill Southern California, and the execution of value‑add initiatives across our industrial portfolio. While we did not complete any acquisitions during the prior year and current quarter, our long‑term strategy continues to prioritize opportunities that demonstrate the potential for accretion to Core FFO and net asset value per share that will be evaluated through rigorous underwriting criteria reflecting current market conditions and our cost of capital. We will continue to evaluate and execute upon the repositioning and improvement of properties already within our portfolio to enhance functionality, marketability, future cash‑flow growth and drive value creation that meet our strengthened risk-adjusted return thresholds.
Current report
Consistent with our refined capital‑allocation strategy communicated in November 2025, the Company is placing heightened emphasis on maximizing risk‑adjusted returns through a programmatic disposition strategy, recycling capital into higher‑return repositioning projects within our existing portfolio, share repurchases, and selective development and acquisition opportunities aligned with rigorous underwriting standards. These refinements build upon our longstanding focus on infill Southern California industrial real estate, a market that we believe continues to offer superior long‑term fundamentals.
Current report
(4)As of the first quarter of 2026, 3211-3233 Mission Oaks Boulevard, 12772 San Fernando Road, 19900 Plummer Street, and 1500 Raymond Avenue are considered stabilized, as each reached one year from construction completion, but remain in lease‑up for presentation purposes because the properties have not yet achieved 90% occupancy.
Current report
(8)As of the fourth quarter of 2025, 1315 Storm Parkway was considered stabilized, as it reached one year from construction completion, but remained in lease‑up for presentation purposes because the property had not yet achieved 90% occupancy. In the first quarter of 2026, the project achieved full occupancy and, for presentation purposes, is reflected above as stabilized in the first quarter of 2026.
Current report
(8)Reflects our renewal leasing activity, weighted average lease term, effective rent per square foot and leasing spreads excluding a 1.1 million square foot lease extension with Tireco, Inc. at 10545 Production Avenue. The current lease, which was originally set to expire in January 2027, was extended through April 2030, commencing February 1, 2027. The above-market prior lease rate was reset to market, representing net effective and cash leasing spreads of (31.0)% and (33.5)%, respectively. The lease includes annual contractual increases of 2.75% and three months of free rent in 2027, in addition to a conversion to a gross lease from a NNN lease, which enables us to capture the benefit from any potential reduction in real estate property taxes. This lease extension is not expected to be indicative of our future portfolio leasing spreads given the unique size of the premises, adjacent competitive supply, and deal structure.
Removed paragraphs (21)
Previous report
•During the second quarter of 2025, we sold two properties with a combined 208,610 rentable square feet for a total gross sale price of $81.6 million and recognized $44.4 million in gains on sale of real estate.
Previous report
Repositioning & Redevelopment
Previous report
•During the nine months ended September 30, 2025, we stabilized 14 of our repositioning/redevelopment projects as follows:
Previous report
◦During the first quarter of 2025, we stabilized five of our repositioning projects located at 4039 Calle Platino, 29120 Commerce Center Drive, East 27th Street, 122-125 North Vinedo Avenue and 29125 Avenue Paine, which have a combined 560,255 rentable square feet.
Previous report
◦During the third quarter of 2025, we stabilized three of our repositioning projects located at 11308-11350 Penrose Street, 1020 Bixby Drive and Harcourt & Susana and four of our redevelopment projects located at 8888 Balboa Avenue, 6027 Eastern Avenue, 2390-2444 American Way and 3071 Coronado Street, which have a combined 586,435 rentable square feet.
Previous report
•During the nine months ended September 30, 2025, we completed construction at 16 of our repositioning/redevelopment properties which have a combined 1,336,108 rentable square feet. As of September 30, 2025, 14 of these properties were in the lease-up stage and two were stabilized and included above.
Previous report
Equity
Previous report
•During the first quarter of 2025, we settled the remaining portion of the forward equity sale agreement related to our March 2024 underwritten public offering by issuing 9,776,768 shares of common stock for net proceeds of $478.0 million, based on a weighted average forward price of $48.89 per share at settlement.
Previous report
Financing
Previous report
•On May 30, 2025, we amended our senior unsecured credit agreement to, among other changes, increase the borrowing capacity under our unsecured revolving credit facility from $1.0 billion to $1.25 billion, extend the maturity date of the unsecured revolving credit facility from May 26, 2026 to May 30, 2029 (with two extension options of six months each), extend the maturity date of the $400.0 million unsecured term loan facility from July 18, 2025 to May 30, 2030, and lower the interest rate by eliminating the 0.10% SOFR adjustment that previously applied to both the unsecured revolving credit facility and $400.0 million unsecured term loan facility.
Previous report
•On June 30, 2025, we executed three interest rate swaps with an aggregate notional value of $400.0 million to fix daily SOFR related to our $400.0 unsecured term loan facility at a rate of 3.41375%, commencing on July 1, 2025 through May 30, 2030. These swaps take the place of the swaps that were previously in place from April 3, 2023 through June 30, 2025, which fixed daily SOFR at 3.97231%.
Previous report
•On August 6, 2025, we paid in full the outstanding principal balance on the $100 million unsecured senior notes.
Previous report
•On September 2, 2025, we amended our $60.0 million term loan facility to, among other changes, add two additional one-year extension options. As of September 30, 2025, we have three remaining one-year extension options available, subject to certain terms and conditions.
Previous report
In the overall infill Southern California market, vacancy increased quarter-over-quarter to 5.1%, net absorption was a positive 0.4 million square feet and average asking lease rates decreased by approximately 2% quarter-over-quarter.
Previous report
In Orange County, average asking lease rates were flat quarter-over-quarter and vacancy increased quarter-over-quarter to 5.1%. Market conditions are expected to be favorable over the long-term due to steady demand and the continued low availability of industrial product in this region.
Previous report
Acquisitions and Value-Add Repositioning and Redevelopment of Properties
Previous report
(4)During the third quarter of 2025 we leased 800 Sandhill to a single tenant with the lease expected to commence in the fourth quarter of 2025.
Previous report
(5)The net effective and cash releasing spreads for new leases signed in the second quarter were disproportionately impacted by a 106,251-square-foot lease with a net effective and cash releasing spread of (31.6)% and (36.9)%, respectively. This lease represented approximately 54% of the 196,430 square feet of comparable new leases signed during the second quarter. Excluding this lease, net effective and cash releasing spreads for new leases signed in the second quarter would have been 4.2% and (0.5)%, respectively.
Previous report
(6)New leases signed in the third quarter included a 504,016-square-foot lease with a net effective leasing rate of $6.31 per square foot and a net effective and cash releasing spread of 68.2% and 42.8%, respectively. Excluding this lease, the net effective leasing rate would have been $16.82 per square foot, with net effective and cash releasing spreads of 15.1% and 2.5% respectively.
Previous report
The leases scheduled to expire during the remainder of 2025 and 2026 represent approximately 5.2% and 16.3%, respectively, of the total annualized base rent for our portfolio as of September 30, 2025. We estimate that, on a weighted average basis, in-place rents of leases scheduled to expire during the remainder of 2025 and 2026 are currently below current market asking rates, although individual units or properties within any particular submarket may currently be leased either above, below, or at the current market asking rates within that submarket.
Previous report
As described under “—Market and Portfolio Fundamentals” above, while market indicators, including changes in vacancy rates and average asking lease rates, varied by market and showed signs of a post-pandemic normalizing of tenant demand, overall there was continued relative low market vacancy and supply and demand imbalance across our submarkets, which continues to support favorable long-term market fundamentals.
Reworded paragraphs (56)
Previous wording
•risks associated with redevelopment and repositioning activities, including the possibility that costs may exceed original estimates, the time to complete a project or to lease up the completed project may be greater than originally anticipated or changes in entitlements or laws may impact or prevent execution of intended projects, including without limitation, California Assembly Bill 98;
Current wording
•risks associated with development and repositioning activities, including the possibility that costs may exceed original estimates, the time to complete a project or to lease up the completed project may be greater than originally anticipated or changes in entitlements or laws may impact or prevent execution of intended projects, including without limitation, California Assembly Bill 98 and California Senate Bill 415;
Previous wording
•national, international, regional and local economic conditions, including impacts and uncertainty from trade disputes and tariffs on goods imported to the United States and goods exported to other countries;
Current wording
•national, international, regional and local economic conditions, including impacts and uncertainty from military conflicts in Iran and the greater Middle East and from trade disputes and tariffs on goods imported to the United States and goods exported to other countries;
Previous wording
•our failure to complete acquisitions;
Current wording
•our failure to complete acquisitions and dispositions;
Previous wording
•our ability to maintain our current investment grade ratings by Fitch Ratings (“Fitch”), Moody’s Investors Services (“Moody’s”) or from Standard and Poor’s Ratings Services (“S&P”);
Current wording
•our ability to maintain our current investment grade ratings by Fitch Ratings (“Fitch”), Moody’s Investors Services (“Moody’s”) or from Standard & Poor’s Ratings Services (“S&P”);
Previous wording
Rexford Industrial Realty, Inc. is a self-administered and self-managed full-service REIT focused on owning and operating industrial properties in Southern California infill markets. We were formed as a Maryland corporation on January 18, 2013, and Rexford Industrial Realty, L.P. (the “Operating Partnership”), of which we are the sole general partner, was formed as a Maryland limited partnership on January 18, 2013. Through our controlling interest in our Operating Partnership and its subsidiaries, we acquire, own, improve, reposition, redevelop, lease and manage industrial real estate principally located in Southern California infill markets, and, from time to time, acquire or provide mortgage debt secured by industrial zoned property or property suitable for industrial development. From time to time we also sell assets as part of our capital allocation strategy. We are organized and conduct our operations to qualify as a REIT under the Code and generally are not subject to federal taxes on our income to the extent we distribute our income to our shareholders and maintain our qualification as a REIT.
Current wording
Rexford Industrial Realty, Inc. is a self-administered and self-managed full-service REIT focused on owning and operating industrial properties in Southern California infill markets. We were formed as a Maryland corporation on January 18, 2013, and Rexford Industrial Realty, L.P. (the “Operating Partnership”), of which we are the sole general partner, was formed as a Maryland limited partnership on January 18, 2013. Through our controlling interest in our Operating Partnership and its subsidiaries, we acquire, own, improve, reposition, develop, lease and manage industrial real estate principally located in Southern California infill markets, and, from time to time, acquire or provide mortgage debt secured by industrial zoned property or property suitable for industrial development. We also sell assets as part of our capital allocation strategy. We are organized and conduct our operations to qualify as a REIT under the Code and generally are not subject to federal taxes on our income to the extent we distribute our income to our stockholders and maintain our qualification as a REIT.
Previous wording
As of September 30, 2025, our consolidated portfolio consisted of 420 properties with approximately 50.9 million rentable square feet.
Current wording
As of March 31, 2026, our consolidated portfolio consisted of 414 properties with approximately 50.4 million rentable square feet.
Previous wording
Our goal is to generate attractive risk-adjusted returns for our stockholders by providing superior access to industrial property investments and mortgage debt investments secured by industrial property in high-barrier Southern California infill markets. Our target markets provide us with opportunities to acquire both stabilized properties generating favorable cash flow, as well as properties or land parcels where we can enhance returns through value-add repositioning and redevelopments. Scarcity of available space and high barriers limiting new construction of for-lease product all contribute to create superior long-term supply/demand fundamentals within our target infill Southern California industrial property markets. With our vertically integrated operating platform and extensive value-add investment and management capabilities, we believe we are positioned to capitalize upon the opportunities in our markets to achieve our objectives.
Current wording
Our goal is to generate attractive risk-adjusted returns for our stockholders by providing superior access to industrial property investments in high-barrier Southern California infill markets. Our target markets provide us with opportunities to acquire both stabilized properties generating favorable cash flow, as well as properties or land parcels where we can enhance returns through value-add repositioning and developments. Scarcity of available space and high barriers limiting new construction of for-lease product all contribute to create superior long-term supply/demand fundamentals within our target infill Southern California industrial property markets. With our vertically integrated operating platform and extensive value-add investment and management capabilities, we believe we are positioned to capitalize upon the opportunities in our markets to achieve our objectives.
Previous wording
•Net income attributable to common stockholders increased by 32.1% to $268.9 million for the nine months ended September 30, 2025, compared to the prior year.
Current wording
•Net income attributable to common stockholders increased by 28.6% to $87.9 million for the three months ended March 31, 2026, compared to the prior year.
Previous wording
•Core funds from operations (Core FFO)(1) attributable to common stockholders increased by 10.3% to $422.4 million for the nine months ended September 30, 2025, compared to the prior year.
Current wording
•Core funds from operations (Core FFO)(1) attributable to common stockholders decreased by 0.9% to $139.8 million for the three months ended March 31, 2026, compared to the prior year.
Previous wording
•Net operating income (NOI)(1) increased by 7.7% to $568.7 million for the nine months ended September 30, 2025, compared to the prior year.
Current wording
•Net operating income (NOI)(1) decreased by 4.2% to $185.4 million for the three months ended March 31, 2026, compared to the prior year.
Previous wording
•Total portfolio occupancy at September 30, 2025 was 91.8%.
Current wording
•Total portfolio occupancy at March 31, 2026 was 90.7%.
Previous wording
•Same Property Portfolio(2) average occupancy for the nine months ended September 30, 2025 was 96.2% and ending occupancy at September 30, 2025 was 96.8%.
Current wording
•Same Property Portfolio(2) average occupancy for the three months ended March 31, 2026 was 96.3% and ending occupancy at March 31, 2026 was 96.1%.
Previous wording
•Executed a total of 360 new and renewal leases with a combined 7.4 million rentable square feet, with leasing spreads of 23.9% on a GAAP basis and 11.4% on a cash basis.
Current wording
•Executed a total of 144 new and renewal leases with a combined 4.1 million rentable square feet, with leasing spreads of (10.0)% on a net effective basis and (15.4)% on a cash basis. Excluding one lease extension covering 1.1 million rentable square feet, leasing spreads were 5.5% on a net effective basis and (1.8)% on a cash basis.
Previous wording
•During the third quarter of 2025, we sold three properties with a combined 151,760 rentable square feet for a total gross sale price of $53.6 million and recognized $28.6 million in gains on sale of real estate.
Current wording
•During the first quarter of 2026, we sold five properties with a combined 314,693 rentable square feet for a total gross sale price of $127.4 million and recognized $26.3 million in gains on sale of real estate. Three of these properties were previously impaired, including additional impairments recorded during the quarter, and were sold without a gain or loss.
Previous wording
•During the first quarter of 2025, we sold one property with 127,775 rentable square feet for a gross sale price of $52.5 million and recognized $13.2 million in gains on sale of real estate.
Current wording
•Subsequent to the first quarter of 2026, we sold one property with 101,380 rentable square feet for a gross sale price $16.5 million.
Previous wording
◦During the second quarter of 2025, we stabilized our repositioning project located at 218 Turnbull Canyon and our redevelopment project located at 1901 Via Burton, which have a combined 330,602 rentable square feet.
Current wording
•During the first quarter of 2026, we stabilized our development project located at 12118 Bloomfield Avenue and our repositioning project located at 1315 Storm Parkway, which have a combined 144,889 rentable square feet.
Previous wording
•During the third quarter of 2025, we repurchased 3,883,845 shares of our common stock under our stock repurchase programs at a weighted average price of $38.62 per share for a total of $150.0 million.
Current wording
•During the first quarter of 2026, we repurchased 5,534,357 shares of our common stock under our stock repurchase program at a weighted average price of $36.14 per share for a total of $200.1 million, including commissions.
Previous wording
The infill Southern California industrial real estate sector continues to exhibit favorable long-term supply-demand fundamentals. These high-barrier infill markets are characterized by a relative scarcity of highly functional product, coupled with the limited ability to introduce new supply over the long-term due to high land and redevelopment costs, regulatory hurdles with restrictive development constraints and a dearth of developable land in markets experiencing a net reduction in supply as, over time, more industrial property is converted to non-industrial uses than can be delivered. While we believe that our infill Southern California industrial property markets have demonstrated resiliency related to occupancy and rental rates in the context of key market drivers over the last several years, we expect some ongoing volatility within our markets through the near term, principally driven by general macroeconomic and political uncertainty including recent changes in trade and tariff policy, an uncertain interest rate environment, persistent inflation and global geopolitical unrest. According to third-party market data, market rent growth within our infill Southern California markets has decreased approximately 22% since market rents peaked in mid-2023, after an increase of approximately 80%, on average, through the pandemic years of 2020 through 2022.
Current wording
The infill Southern California industrial real estate sector continues to exhibit favorable long-term supply-demand fundamentals. These high-barrier infill markets are characterized by a relative scarcity of highly functional product, coupled with the limited ability to introduce new supply over the long-term due to high land and development costs, increasing regulatory hurdles with restrictive development constraints and a dearth of developable land. That said, we expect some ongoing volatility within our markets through the near term, principally driven by general macroeconomic and political uncertainty including recent changes in trade and tariff policy, an uncertain interest rate environment, persistent inflation and global geopolitical unrest. According to third-party market data, market rent growth within our infill Southern California markets has decreased approximately 22% from the peak levels reached in mid-2023. This decline follows an average increase of approximately 80% during the pandemic years of 2020 through 2022. Based on the same third-party market data, overall market rents remain approximately 40% above pre-pandemic levels.
Previous wording
Leasing activity for our assets was strong and net absorption was positive during the third quarter, reflecting an improvement in tenant demand. Specifically, leasing activity at our repositioning and redevelopment projects increased when compared to the first half of 2025. However, we recognize that heightened macroeconomic and tariff uncertainty continues to weigh on tenant decision-making and may influence tenant demand going forward.
Current wording
Leasing activity across our portfolio was strong during the first quarter, however, market vacancy continues to increase and net absorption remains negative. We recognize that heightened macroeconomic and tariff uncertainty may continue to weigh on tenant decision-making and may influence tenant demand going forward.
Previous wording
Tenant demand has been driven by a wide range of sectors, from consumer products, healthcare and medical products to aerospace and defense, food and beverage, construction and logistics, e-commerce, among other sectors. Our portfolio, which we believe represents prime locations with superior functionality within the largest last-mile logistics distribution market in the nation, is well-positioned to continue to serve our diverse tenant base and attract incremental ecommerce-oriented and traditional distribution demand over the long-term.
Current wording
Tenant demand has been driven by a wide range of sectors, from consumer products, healthcare and medical products to aerospace and defense, food and beverage, construction and logistics, e-commerce, among other sectors. Our portfolio, which we believe represents prime locations with superior functionality within the largest last-mile logistics distribution market in the nation, is well-positioned to continue to serve our diverse tenant base and attract tenant demand over the long-term.
Previous wording
We believe our portfolio’s leasing performance during the third quarter of 2025 has generally outpaced that of the infill markets within which we operate. We believe this performance has been driven by our highly entrepreneurial business model focused on acquiring and improving industrial property in superior locations so that our portfolio reflects a higher level of quality and functionality, on average, as compared to typical available product within the markets within which we operate. We believe that our portfolio, comprised of smaller space sizes averaging 26,000 square feet located entirely within last-mile, infill Southern California locations is well positioned to serve regional consumption and may be less susceptible to changes in global trade flows as compared to large warehouses located within non-infill submarkets. We also believe the quality and entrepreneurial approach demonstrated by our vertically-integrated team of real estate professionals actively managing our properties and our tenants enables the potential to outcompete within our markets where we believe competing properties are generally otherwise owned by more passive, less-focused real estate owners.
Current wording
We believe our portfolio’s leasing performance during the first quarter of 2026 has generally outpaced that of the infill markets within which we operate. We believe this performance has been driven by our highly entrepreneurial business model focused on acquiring and improving industrial property in superior locations so that our portfolio reflects a higher level of quality and functionality, on average, as compared to typical available product within the markets within which we operate. We believe that our portfolio, comprised of smaller space sizes averaging 28,000 square feet located entirely within last-mile, infill Southern California locations is well positioned to serve regional consumption and may be less susceptible to changes in global trade flows as compared to large warehouses located within non-infill submarkets. We also believe the quality and entrepreneurial approach demonstrated by our team of real estate professionals actively managing our properties and our tenants enables the potential to outcompete within our markets where we believe competing properties are generally otherwise owned by more passive, less-focused real estate owners. Additionally, supply under construction is far below recent historical levels, and coupled with the increasingly restrictive regulatory environment, the near and long term opportunity to create value through repositioning existing assets is robust.
Previous wording
In Los Angeles County, vacancy increased quarter-over-quarter to 5.0% and average asking lease rates declined quarter-over-quarter. New development is limited by a lack of land availability and an increase in land and development costs.
Current wording
In Los Angeles County, vacancy increased quarter-over-quarter to 5.3% and average asking lease rates declined quarter-over-quarter.
Previous wording
In the Inland Empire West, which contains infill markets in which we operate, vacancy decreased quarter-over-quarter to 4.6% and average taking lease rates were flat quarter-over-quarter. We generally do not focus on properties located within the non-infill Inland Empire East sub-market where available land and the development and construction pipeline for new supply is substantial.
Current wording
In the Inland Empire West, which contains infill markets in which we operate, vacancy increased quarter-over-quarter to 6.4% and average taking lease rates increased quarter-over-quarter. We generally do not focus on properties located within the non-infill Inland Empire East sub-market where there is excess land available for development.
Previous wording
In San Diego, vacancy increased quarter-over-quarter and average asking lease rates decreased quarter-over-quarter.
Current wording
In San Diego, vacancy increased quarter-over-quarter to 6.7% and average asking lease rates declined quarter-over-quarter.
Previous wording
In Ventura County, vacancy increased quarter-over-quarter and average asking lease rates declined quarter-over-quarter.
Current wording
In Ventura County, vacancy increased quarter-over-quarter to 4.4% and average asking lease rates declined quarter-over-quarter.
Previous wording
The Company’s growth strategy comprises acquiring leased, stabilized properties as well as properties with value-add opportunities to improve functionality and to deploy our value-driven asset management programs in order to increase cash flow and value. Additionally, from time to time, we may acquire industrial outdoor storage sites, land parcels or properties with excess land for ground-up redevelopment projects. Acquisitions may comprise single property investments as well as the purchase of portfolios of properties, with transaction values ranging from approximately $10 million single property investments to portfolios potentially valued in the billions of dollars. The Company’s geographic focus remains infill Southern California. However, from time-to-time, portfolios could be acquired comprising a critical mass of infill Southern California industrial property that could include some assets located in markets outside of infill Southern California. In general, to the extent non-infill-Southern California assets were to be acquired as part of a larger portfolio, the Company may underwrite such investments with the potential to dispose such assets over a certain period of time in order to maximize its core focus on infill Southern California, while endeavoring to take appropriate steps to satisfy REIT safe harbor requirements to avoid prohibited transactions under REIT tax laws. Similarly, while our focus is owning and operating industrial properties in Southern California infill markets, occasionally an acquisition may include non-industrial properties, such as office and other uses, with the intent to reposition or redevelop the properties into industrial use or to dispose of the non-industrial assets in a manner intended to satisfy REIT safe harbor requirements to avoid prohibited transactions under REIT tax laws.
Current wording
The Company’s historical investment strategy targets industrial property investments demonstrating the potential for accretion in Core FFO and net asset value, both on a per share basis, over the near- to longer-term. These target investments may comprise acquiring leased, stabilized properties as well as properties with value-add opportunities to improve functionality and to deploy our value-driven asset management programs in order to increase cash flow and value. Additionally, from time to time, we may acquire industrial outdoor storage sites, land parcels or properties with excess land for ground-up development projects. Acquisitions may comprise single property investments as well as the purchase of portfolios of properties, with transaction values ranging from approximately $10 million single property investments to portfolios potentially valued in the billions of dollars. The Company’s geographic focus remains infill Southern California. However, from time-to-time, portfolios could be acquired comprising a critical mass of infill Southern California industrial property that could include some assets located in markets outside of infill Southern California. In general, to the extent non-infill-Southern California assets were to be acquired as part of a larger portfolio, the Company may underwrite such investments with the potential to dispose such assets over a certain period of time in order to maximize its core focus on infill Southern California, while endeavoring to take appropriate steps to satisfy REIT safe harbor requirements to avoid prohibited transactions under REIT tax laws. Similarly, while our focus is owning and operating industrial properties in Southern California infill markets, occasionally an acquisition may include non-industrial properties, such as office and other uses, with the intent to reposition or develop the properties into industrial use or to dispose of the non-industrial assets in a manner intended to satisfy REIT safe harbor requirements to avoid prohibited transactions under REIT tax laws.
Previous wording
A key component of our growth strategy is to acquire properties through off-market and lightly marketed transactions that are often operating at below-market occupancy or below-market rent at the time of acquisition or that have near-term lease roll-over or that provide opportunities to add value through functional or physical repositioning and improvements. Through various repositioning, redevelopment, and professional leasing and marketing strategies, we seek to increase the properties’ functionality and attractiveness to prospective tenants and, over time, to stabilize the properties at occupancy rates that meet or exceed market rates.
Current wording
A key component of our growth strategy has historically been to acquire properties through off-market and lightly marketed transactions that are often operating at below-market occupancy or below-market rent at the time of acquisition or that have near-term lease roll-over, or that provide opportunities to add value through functional or physical repositioning and improvements. Through various repositioning, development, and professional leasing and marketing strategies, we seek to increase the properties’ functionality and attractiveness to prospective tenants and, over time, to stabilize the properties at occupancy rates that meet or exceed market rates.
Previous wording
A repositioning can provide a range of property improvements. This may include a complete structural renovation of a property whereby we convert large underutilized spaces into a series of smaller and more functional spaces, or it may include the creation of additional square footage, the modernization of the property improvements, the elimination of functional obsolescence, the addition or enhancement of loading areas and truck access, the enhancement of fire-life-safety systems or other accretive improvements, in each case designed to improve the cash flow and value of the property.
Current wording
Repositioning remains a central component of our value‑creation strategy, as we seek to modernize, reconfigure, and enhance existing properties to align with tenant demand and maximize risk‑adjusted returns. A repositioning can provide a range of property improvements. This may include a complete structural renovation of a property whereby we convert large underutilized spaces into a series of smaller and more functional spaces, or it may include the creation of additional square footage, the modernization of the property improvements, the elimination of functional obsolescence, the addition or enhancement of loading areas and truck access, the enhancement of fire-life-safety systems or other accretive improvements, in each case designed to improve the cash flow and value of the property.
Previous wording
We have a number of significant repositioning properties, which are individually presented in the tables below. A repositioning property that is considered significant is typically defined as a property where a significant amount of space is held vacant in order to implement capital improvements, the cost to complete repositioning work and lease-up is estimated to be greater than $2 million and the repositioning and lease-up time frame is estimated to be greater than six months. We also have a range of other spaces in repositioning, that due to their smaller size, relative scope, projected repositioning costs or relatively nominal amount of down-time, are not presented below, however, in the aggregate, may be substantial (and which we refer to as “other repositioning projects”).
Current wording
We have a number of repositioning properties, which are individually presented in the tables below. A repositioning property that is considered significant is typically defined as a property where a significant amount of space is held vacant in order to implement capital improvements, the cost to complete repositioning work and lease-up is estimated to be greater than $2.5 million and the repositioning and lease-up time frame is estimated to be greater than six months. We also have a range of other spaces in repositioning, that due to their smaller size, relative scope, projected repositioning costs or relatively nominal amount of down-time, are not presented below, however, in the aggregate, may be substantial.
Previous wording
A redevelopment property is defined as a property where we plan to fully or partially demolish an existing building(s) due to building obsolescence and/or a property with excess or vacant land where we plan to construct a ground-up building.
Current wording
A development property is defined as a property where we plan to fully demolish an existing building(s) due to building obsolescence and/or construct a ground-up building on a property with excess or vacant land. At the end of 2025 we re-evaluated our near-term development pipeline to focus on opportunities that satisfy enhanced underwriting criteria. As part of this process, we evaluated alternatives including proceeding with development, postponing construction, or selling the site based on relative risk‑adjusted returns. Following this review, we determined not to proceed with six projects totaling approximately 850,000 square feet of planned development. During the first quarter of 2026, we sold three of these projects, and as of March 31, 2026, two of these projects were classified as held for sale.
Previous wording
As of September 30, 2025, 12 of our properties were under current repositioning or redevelopment and 16 of our properties were in the lease-up stage. In addition, we have a pipeline of 12 additional properties for which we anticipate beginning repositioning/redevelopment construction work over the near term. The tables below set forth a summary of these properties, as well as the properties that were most recently stabilized in 2025 and 2024, as the timing of these stabilizations have a direct impact on our current and comparative results of operations. We consider a repositioning/redevelopment property to be stabilized upon the earlier of (i) reaching 90% occupancy or (ii) one year from the date construction work is completed.
Current wording
As of March 31, 2026, nine of our repositioning or development properties were under construction and 12 of our properties were in the lease-up stage. In addition, following our re-evaluation of the development pipeline, we have five properties as near-term potential future repositioning and development opportunities. The tables below set forth a summary of these properties, as well as the properties that were most recently stabilized in 2026 and 2025, as the timing of these stabilizations have a direct impact on our current and comparative results of operations. We consider a repositioning/development property to be stabilized upon the earlier of (i) reaching 90% occupancy or (ii) one year from the date construction work is completed.
Previous wording
(2)“Repositioning/Lease-up Rentable Square Feet” is the actual rentable square footage that is subject to repositioning at the property/buildings, and may be less than the total rentable square footage of the entire property or particular building(s) under repositioning.
Current wording
(2)Rentable square feet is the actual rentable square footage that is subject to repositioning at the property/building, and may be less than the total rentable square footage of the entire property or particular building(s) under repositioning. For developments, rentable square feet represents the estimated rentable square footage of the project upon completion of the development.
Previous wording
(6)As of September 30, 2025, the entire project includes 526,069 rentable square feet, comprised of: (i) 3211 Mission Oaks Boulevard, a newly constructed building totaling 116,852 rentable square feet, and (ii) 3233 Mission Oaks Boulevard, with 409,217 rentable square feet which were not redeveloped. Site improvements were completed across the entire project. The rentable square feet and property leased percentage apply only to 3211 Mission Oaks Boulevard.
Current wording
(3)As of March 31, 2026, the entire project includes 526,069 rentable square feet, comprised of: (i) 3211 Mission Oaks Boulevard, a newly constructed building totaling 116,852 rentable square feet, and (ii) 3233 Mission Oaks Boulevard, with 409,217 rentable square feet which were not redeveloped. Site improvements were completed across the entire project. The rentable square feet and property leased percentage apply only to 3211 Mission Oaks Boulevard.
Previous wording
(9)9400-9500 Santa Fe Springs Road totals 595,304 rentable square feet and the proposed repositioning project pertains to work at only one of the units, totaling 184,270 rentable square feet.
Current wording
(6)9400-9500 Santa Fe Springs Road totals 595,304 rentable square feet and the proposed repositioning project pertains to work at only one of the units, totaling 184,270 rentable square feet.
Previous wording
(10)We consider a repositioning property to be stabilized upon the earlier of (i) reaching 90% occupancy or (ii) one year from the date construction work is completed.
Current wording
(7)We consider a repositioning or development property to be stabilized upon the earlier of (i) reaching 90% occupancy or (ii) one year from the date construction work is completed.
Previous wording
(11)11308-11350 Penrose Street and 3071 Coronado were both considered stabilized in the first quarter of 2025 as they reached one year from the date of completion of construction work and were still in lease-up. In the third quarter of 2025 both projects achieved 100% occupancy and for presentation purposes above are reflected as stabilized in the third quarter of 2025.
Current wording
(9)As of the first quarter of 2025, 11308–11350 Penrose Street and 3071 Coronado were considered stabilized, as each reached one year from construction completion, but remained in lease‑up for presentation purposes because the properties had not yet achieved 90% occupancy. In the third quarter of 2025, both projects achieved full occupancy and, for presentation purposes, are reflected above as stabilized in the third quarter of 2025.
Previous wording
(3)14434-14527 San Pedro Street is a low coverage site with 58,225 rentable square feet of buildings on 335,905 square feet, or 7.7 acres, of land.
Current wording
(10)14434-14527 San Pedro Street is a low coverage site with 58,225 rentable square feet of buildings on 335,905 square feet, or 7.7 acres, of land.
Previous wording
(7)Rancho Pacifica Building 5 is located at 2370-2398 Pacifica Place and comprises one building totaling 51,594 rentable square feet, out of six buildings at our Rancho Pacifica Park property, which has a total of 1,111,885 rentable square feet. We demolished the existing building and constructed a new building comprising approximately 76,553 rentable square feet in its place.
Current wording
(11)Rancho Pacifica Building 5 is located at 2370-2398 Pacifica Place and comprises one building totaling 51,594 rentable square feet, out of six buildings at our Rancho Pacifica Park property, which has a total of 1,111,885 rentable square feet. We demolished the existing building and constructed a new building comprising approximately 76,553 rentable square feet in its place.
Previous wording
Properties that are nonoperational as a result of repositioning or redevelopment activity may qualify for varying levels of interest, insurance and real estate tax capitalization during the redevelopment and construction period. An increase in our repositioning and redevelopment activities resulting from value-add acquisitions could cause an increase in the asset balances qualifying for interest, insurance and tax capitalization in future periods. We capitalized $26.5 million of interest expense and $7.4 million of insurance and real estate tax expenses during the nine months ended September 30, 2025, respectively, related to our repositioning and redevelopment projects.
Current wording
Properties that are nonoperational as a result of repositioning or development activity may qualify for varying levels of interest, insurance and real estate tax capitalization during the development and construction period. An increase in our repositioning and development activities resulting from value-add acquisitions could cause an increase in the asset balances qualifying for interest, insurance and tax capitalization in future periods. We capitalized $7.4 million of interest expense and $2.4 million of insurance and real estate tax expenses during the three months ended March 31, 2026, respectively, related to our repositioning and development projects.
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Previous report — wording carried elsewhere
(5)Represents the estimated rentable square footage of the project upon completion of redevelopment.