Rexford Industrial Realty, Inc.

Factors That May Influence Future Results of Operations

Market and Portfolio Fundamentals

Our operating results depend upon the infill Southern California industrial real estate market.

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 a higher 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 23% 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 37% above pre-pandemic levels.

Leasing activity across our portfolio was healthy during the quarter. Market vacancy increased slightly and net absorption was positive. Performance across submarkets, size ranges and quality continues to vary. We recognize that heightened macroeconomic uncertainty, including a higher interest rate environment, may impact tenant demand going forward.

Tenant demand has been driven by a wide range of sectors, from consumer products, healthcare and medical products, advanced manufacturing, food and beverage, construction, distribution and logistics, and 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.

General Market Conditions

We believe our portfolio’s leasing performance during the third quarter of 2026 has generally outpaced that of the infill markets within which we operate. We believe this performance has been driven by our business model focused on owning 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 25,000 square feet located entirely within dense, 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 approach demonstrated by our team of real estate professionals actively managing our properties and our tenants enables the potential to outcompete within our markets. 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 favorable.

The following general market conditions have been sourced from third-party market data and do not necessarily reflect the results of our portfolio. Certain third-party market statistics may not be directly comparable to those presented in prior periods due to changes in the composition of the underlying market data. For our portfolio specific results see “—Rental Revenues” and “—Results of Operations” below.

In Los Angeles County, vacancy increased quarter-over-quarter to 5.0% and average asking lease rates increased quarter-over-quarter.

In Orange County, vacancy was unchanged quarter-over-quarter at 5.5% and average asking lease rates increased quarter-over-quarter.

In the Inland Empire West, which contains infill markets in which we operate, vacancy was unchanged quarter-over-quarter at 5.9% and average taking lease rates decreased 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.

In San Diego, vacancy increased quarter-over-quarter to 6.3% and average asking lease rates increased quarter-over-quarter.

In Ventura County, vacancy increased quarter-over-quarter to 4.6% and average asking lease rates decreased quarter-over-quarter.

Acquisitions, Dispositions and Value-Add Repositioning and Development of Properties

Our strategy is centered on creating long-term shareholder value and per-share FFO and net asset value growth through disciplined capital allocation, targeted investment in infill Southern California industrial real estate and value-add execution across our portfolio that meet our risk-adjusted return requirements, as well as strategic capital recycling.

Consistent with the capital allocation strategy announced in November 2025 and our comprehensive portfolio review in 2026, during the nine months ended September 30, 2026, we completed approximately $1.5 billion of dispositions and currently anticipate total dispositions of approximately $1.7 billion to $2.0 billion for 2026. Our disposition strategy reflects our efforts to enhance portfolio quality and cash flow durability, improve capital efficiency and reallocate capital toward opportunities that we believe offer the most attractive long-term risk-adjusted returns and strengthen shareholder value. Properties identified for potential disposition are generally those that we believe do not meet our strategic objectives and offer lower long-term risk-adjusted returns relative to alternative uses of capital. We have used and intend to continue to use net proceeds from dispositions primarily to repay outstanding indebtedness, including our 2027 debt maturities, fund select value-add repositioning and development activity within our existing portfolio and repurchase shares of our common stock. We believe these actions will strengthen our balance sheet, reduce our near-term refinancing requirements, enhance financial flexibility and further align our portfolio and capital allocation with our longstanding focus on infill Southern California industrial real estate, a market that we believe continues to offer attractive long-term fundamentals.

The Company’s investment strategy targets industrial property investments that meet our stringent risk-adjusted return requirements and demonstrate the potential for accretion in Core FFO and net asset value, on a per share basis, over the near- to longer-term. A key component of our external growth strategy is to acquire properties that provide opportunities to add value through functional or qualitative repositioning and improvements and superior leasing, marketing and operations executed by our vertically integrated team. Through various repositioning, development, and operating strategies, we seek to increase the properties’ functionality and attractiveness to prospective tenants and, over time, to stabilize the properties at increased occupancy and market rates driving increased cash flow and value.

External growth through acquisitions may comprise single property investments as well as the purchase of portfolios of properties. 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. 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 either case, we would endeavor to take appropriate steps to satisfy REIT safe harbor requirements and avoid prohibited transactions under REIT tax laws. While we did not complete any acquisitions during the prior year or the nine months ended September 30, 2026, we continue to evaluate investment opportunities that meet our risk-adjusted return requirements, have the potential to be accretive to Core FFO and net asset value per share and satisfy our underwriting criteria that reflect current market conditions and our cost of capital.

Repositioning is 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. We continue to evaluate and execute repositioning and improvement initiatives within our existing portfolio that meet our risk-adjusted return requirements to enhance property functionality, marketability, future cash flow growth and long-term value creation.

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, but that, in the aggregate, may be substantial. A repositioning is generally considered complete once the investment is fully or nearly fully deployed and the property is available for occupancy. Because each repositioning effort is unique and determined based on the property, targeted tenants and overall trends in the general market and specific submarket, the timing and effect of the repositioning on our rental revenue and occupancy levels will vary, and, as a result, will affect the comparison of our results of operations from period to period with limited predictability.

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. Consistent with the capital allocation strategy announced in November 2025, we re-evaluated our near-term development pipeline at the end of 2025 to focus on opportunities that satisfy enhanced underwriting criteria and risk-adjusted return requirements. 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 half of 2026, we sold all six of these projects.

As of September 30, 2026, five of our repositioning or development properties were under construction and 12 of our properties were in the lease-up stage, including properties leased but not yet stabilized. In addition, we have identified four 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, because the timing of these stabilizations has 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.

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(1)The estimated construction start period is the period we anticipate starting physical construction on a project. Prior to physical construction, we engage in pre-construction activities, which include design work, securing permits or entitlements, site work, and other necessary activities preceding construction. The estimated completion period is our current estimate of the period in which we will have substantially completed a project and the project is made available for occupancy. We expect to update our timing estimates on a quarterly basis. The estimated construction period is subject to change as a result of a number of factors including but not limited to permit requirements, delays in construction (including delays related to supply chain backlogs), changes in scope, and other unforeseen circumstances.

(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.

(3)Certain properties that have met our stabilization criteria, as defined in footnote (6), remain reflected in lease-up for presentation purposes because they have not yet achieved 90% occupancy. For presentation purposes, such properties are reclassified from lease-up to stabilized upon achieving 90% occupancy.

(4)During the third quarter of 2026, leases were executed at 9615 Norwalk Blvd, 3680-3880 Voyager Street, and 24935-24955 Avenue Kearny, bringing these properties to 100% leased. The leases are expected to commence in the fourth quarter of 2026.

(5)During the third quarter of 2026, a 214,894 rentable square foot lease was executed at 950 West 190th Street, bringing the property to 100% leased. The lease is expected to commence in first quarter of 2028, subject to completion of construction.

(6)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.

(7)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 applies only to 3211 Mission Oaks Boulevard.

(8)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.

Capitalized Costs

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 $19.7 million of interest expense and $6.9 million of insurance and real estate tax expenses during the nine months ended September 30, 2026, respectively, related to our repositioning and development projects.

Construction Costs and Timing

Currently proposed trade and other political policies, and construction activity levels in other product types may lead to increased construction materials and labor costs, which when combined with longer lead times for governmental approvals and entitlements, have the potential to increase budgeted and actual construction costs and may cause delays in starting and completing certain development projects. Additional increases in costs, further delays or declining market rents could result in a lower expected yield on our development projects, which could negatively impact our future earnings.

Rental Revenues

Our operating results depend primarily upon generating rental revenue from the properties in our portfolio. The amount of rental revenue generated by these properties is affected by our ability to maintain or increase occupancy levels and rental rates at our properties, which will depend upon our ability to lease vacant space and re-lease expiring space at favorable rates.

Occupancy Rates

As of September 30, 2026, our consolidated portfolio, inclusive of space in repositioning as described in the subsequent paragraph, was approximately 91.3% occupied, while our stabilized consolidated portfolio exclusive of such space was approximately 96.1% occupied. Additionally, our improved land and industrial outdoor storage (IOS) sites, totaling approximately 8.3 million land square feet or 189.7 acres, were 94.5% occupied at September 30, 2026. We believe the opportunity to increase occupancy at our properties will continue to be an important driver of future revenue growth, particularly as repositioning and development projects are completed and move through the lease-up phase.

As summarized in the tables under “—Acquisitions, Dispositions and Value-Add Repositioning and Development of Properties” above, as of September 30, 2026, five of our properties with a combined 0.8 million square feet of rentable area at completion are under construction, 12 properties with a combined 1.3 million square feet of rentable area are in lease-up, including properties leased but not yet stabilized, and we have a near-term pipeline of four repositioning and development projects with a combined 0.8 million square feet of rentable area at completion. Additionally, we have 0.7 million rentable square feet of other repositioning projects that are not separately presented in the tables. Vacant space associated with these properties, including our other repositioning projects, is concentrated in our Los Angeles, Orange County, San Bernardino and San Diego markets and represents 5.1% of our total consolidated portfolio square footage as of September 30, 2026. Including this vacant space, our weighted average occupancy rate as of September 30, 2026 in our Los Angeles, Orange County, San Bernardino and San Diego markets was 89.7%, 95.1%, 91.7% and 92.1%, respectively. Excluding this vacant space, our weighted average occupancy rate as of September 30, 2026, in these markets was 95.5%, 97.4%, 96.8% and 98.1%, respectively. We believe that an important portion of our long-term future growth will come from the completion and lease-up of projects currently under or scheduled for repositioning/development, as well as from select opportunities within our existing portfolio or through new investments that meet established risk-adjusted return thresholds, subject to market conditions.

The occupancy rate of properties not undergoing repositioning is affected by regional and local economic conditions in our Southern California infill markets. In the current market environment, our near‑term leasing focus for these operating properties is on preserving occupancy and maintaining cash flow. Although there has been a post-pandemic normalization of market rates and vacancy over the last few years, the Los Angeles, Orange County, San Bernardino–Inland Empire West, San Diego and Ventura markets continue to benefit from long-term fundamental demand drivers and barriers to new supply. Although we cannot predict how our markets may perform in future periods, we believe that general market conditions will continue to provide opportunities over the long term to increase occupancy and rental rates at our properties, which will be an important driver of future revenue growth.

Leasing Activity and Rental Rates

The following tables set forth our leasing activity for new and renewal leases for the three and nine months ended September 30, 2026:

(1)Net effective rent per square foot is the average base rent calculated in accordance with GAAP, over the term of the lease, expressed in dollars per square foot per year. Includes all new and renewal leases that were executed during the quarter.

(2)Calculated as the change between net effective rents for new or renewal leases and the expiring net effective rents (excluding the impact of amortization of intangible assets or liabilities) on the expiring leases for the same space.

(3)Calculated as the change between starting cash rents, excluding any abatements, for new or renewal leases and the expiring cash rents on the expiring leases for the same space.

(4)The net effective and cash re-leasing spreads for new leases executed during the nine months ended September 30, 2026, exclude 67 leases aggregating 2,176,135 rentable square feet for which there was no comparable lease data. Of these 67 excluded leases, 22 leases aggregating 1,274,098 rentable square feet were recently repositioned or developed space. Comparable leases generally exclude: (i) space that has never been occupied under our ownership, (ii) repositioned or developed space, including space in pre-development/entitlement process, (iii) space that has been vacant for over one year or (iv) space with lease terms shorter than 12 months.

(5)Retention is calculated as renewal lease square footage plus relocation/expansion square footage, divided by the square footage of leases expiring during the period. Retention excludes square footage related to the following: (i) expiring leases associated with space that is placed into repositioning (including “other repositioning projects”) after the tenant vacates, (ii) early terminations with pre-negotiated replacement leases and (iii) move outs where space is directly leased by subtenants.

(6)The net effective and cash re-leasing rent spreads for renewal leases executed during the nine months ended September 30, 2026, exclude four leases with a combined 258,579 rentable square feet for which there was no comparable lease data. Comparable leases generally exclude space with lease terms shorter than 12 months or space in pre-development/entitlement process.

(7)Includes leases totaling 837,097 rentable square feet that expired during the nine months ended September 30, 2026, for which the space has been or will be placed into repositioning (including “other repositioning projects”) or development.

Our leasing activity is impacted both by our repositioning and development efforts, as well as by market conditions. While we reposition a property, its space may become unavailable for leasing until completion of our repositioning efforts. As of September 30, 2026, we have five projects under construction that are expected to become available for leasing beginning in the fourth quarter of 2026 through the fourth quarter of 2027. We expect these properties to have positive impacts on our leasing activity and revenue generation as we complete our value-add plans and place these properties in service.

Scheduled Lease Expirations

Our ability to re-lease space subject to expiring leases is affected by economic and competitive conditions in our markets and by the relative desirability of our individual properties, which may impact our results of operations. The following table sets forth a summary schedule of lease expirations for leases in place as of September 30, 2026, for each of the 10 full and partial calendar years beginning with 2026 and thereafter, plus space that is available and under current repositioning.

(1)Represents the contracted building square footage upon expiration.

(2)Annualized base rent (“ABR”) is calculated as monthly contracted base rent (before rent abatements) per the terms of such lease, as of September 30, 2026, multiplied by 12, and then aggregated by year of lease expiration. Excludes tenant reimbursements. Amounts in thousands.

(3)Calculated as ABR set forth in this table divided by ABR for the total portfolio as of September 30, 2026.

(4)Calculated as ABR for such leases divided by the occupied building square feet for such leases as of September 30, 2026. Excluding ABR of $43.0 million associated with improved land and industrial outdoor storage (IOS) leases and $3.0 million associated with cellular tower, solar and parking lot leases, ABR per building square foot is $16.67.

(5)Represents vacant space (not under repositioning/development) as of September 30, 2026. Includes leases aggregating 99,183 rentable square feet that had been signed but had not yet commenced as of September 30, 2026.

(6)Represents vacant space at properties classified as repositioning (including “other repositioning projects”), development or lease-up as of September 30, 2026. Includes leases aggregating 307,244 rentable square feet that had been signed but had not yet commenced as of September 30, 2026.

As of September 30, 2026, in addition to 1.6 million rentable square feet of currently available space in our portfolio and approximately 2.3 million rentable square feet of vacant space under current repositioning/development, leases representing 1.7% and 12.6% of the aggregate rentable square footage of our portfolio are scheduled to expire during the remainder of 2026 and 2027, respectively. During the nine months ended September 30, 2026, we renewed 205 leases for 5.7 million rentable square feet, resulting in a retention rate of 66.1%. During the nine months ended September 30, 2026, new and renewal leases had a weighted average term of 5.4 and 3.8, respectively.

A substantial portion of our leases scheduled to expire over the next several years were executed during a period of significantly higher market rental rate growth. Given the moderation in market rents from peak levels, we expect continued pressure on releasing spreads over the next several years, and releasing spreads on a portion of this expiring space may be negative, particularly for leases executed near the peak of the rental rate cycle.

Conditions in Our Markets

The properties in our portfolio are located primarily in Southern California infill markets. Positive or negative changes in economic or other conditions, trade policy, high or persistent inflation and adverse weather conditions and natural disasters in this market may affect our overall performance.

Our property expenses generally consist of utilities, real estate taxes, insurance, site repair and maintenance costs, and the allocation of overhead costs. For the majority of our properties, our property expenses are recovered, in part, by either the triple net provisions or modified gross expense reimbursements in tenant leases. The majority of our leases also include contractual three percent or greater annual rental rate increases meant, in part, to help mitigate potential increases in property expenses over time. However, the terms of our leases vary, and, in some instances, we may absorb property expenses. Our overall financial results will be impacted by the extent to which we are able to pass-through property expenses to our tenants.

Taxable REIT Subsidiary

As of September 30, 2026, our Operating Partnership indirectly and wholly owns Rexford Industrial Realty and Management, Inc., which we refer to as our services company. We have elected, together with our services company, to treat our services company as a taxable REIT subsidiary for federal income tax purposes. A taxable REIT subsidiary generally may provide non-customary and other services to our tenants and engage in activities that we or our subsidiaries (other than a taxable REIT subsidiary) may not engage in directly without adversely affecting our qualification as a REIT, provided a taxable REIT subsidiary may not operate or manage a lodging facility or health care facility or provide rights to any brand name under which any lodging facility or health care facility is operated. We may form additional taxable REIT subsidiaries in the future, and our Operating Partnership may contribute some or all of its interests in certain wholly owned subsidiaries or their assets to our services company. Any income earned by our taxable REIT subsidiaries will not be included in our taxable income for purposes of the 75% or 95% gross income tests, except to the extent such income is distributed to us as a dividend, in which case such dividend income will qualify under the 95%, but not the 75%, gross income test. Because a taxable REIT subsidiary is subject to federal income tax, and state and local income tax (where applicable) as a regular C-corporation, the income earned by our taxable REIT subsidiaries generally will be subject to an additional level of tax as compared to the income earned by our other subsidiaries. However, our services company has a cumulative unrecognized net operating loss carryforward and therefore there is no income tax provision for the nine months ended September 30, 2026 and 2025. Additionally, our services company had minimal activity during these periods.

Critical Accounting Policies and Estimates

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions in certain circumstances that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amount of revenues and expenses for the reporting periods. Actual amounts may differ from these estimates and assumptions. Management evaluates these estimates on an ongoing basis, based upon information currently available and on various assumptions that it believes are reasonable as of the date hereof. In addition, other companies in similar businesses may use different estimation policies and methodologies, which may affect the comparability of our results of operations and financial condition to those of other companies.

In our Annual Report on Form 10-K for the year ended December 31, 2025, we identified certain critical accounting policies that affect certain of our more significant estimates and assumptions used in preparing our consolidated financial statements. We have not made any material changes to our critical accounting policies and estimates during the period covered by this report.