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Terreno Realty Corporation TRNO recently issued an update on first-quarter 2025 operating, investment and capital activities. Per the first-quarter 2025 update, TRNO locked in higher rents on new and renewed leases, and occupancy improved year over year. This reflects the growing demand for the industrial real estate asset category in a rising e-commerce market.
Let’s gather insight on the line items on which the company has provided an update.
TRNO’s Operating Activity
In the first quarter of 2025, this industrial REIT witnessed a 34.2% increase in cash rents on new and renewed leases for the operating portfolio and 0.0% for the improved land portfolio. The leases that commenced in the first quarter totaled around 0.6 million square feet and 4.3 acres of improved land. The operating portfolio had a tenant retention ratio of 71.7%.
As of March 31, 2025, the occupancy for the operating portfolio was 96.6%, which marks an expansion of 40 basis points (bps) year over year while a contraction of 80 bps sequentially. For the same-store portfolio of around 15.6 million square feet, TRNO had 97.4% quarter-end occupancy, up 110 bps year over year but down 90 bps sequentially.
As of March 31, 2025, the occupancy for the improved land portfolio of 47 parcels encompassing 150.6 acres was 95.1% compared to 95.1% and 94.6% recorded as of Dec. 31, 2024 and March 31, 2024, respectively.
As of March 31, 2025, Terreno Realty’s portfolio included 298 buildings spanning around 19.3 million square feet and 47 improved land parcels encompassing 150.6 acres leased to 663 tenants.
TRNO’s Investment Activity
TRNO has been actively restructuring its portfolio by disposing of non-core assets and acquiring value-accretive investments. Such efforts will aid long-term revenue growth. In the first quarter of 2025, Terreno Realty sold two properties with two industrial distribution buildings spanning around 88,000 square feet at an aggregate sale value of around $24.9 million.
As of March 31, 2025, TRNO had acquisitions worth around $55.9 million under contract and nearly $16 million under letters of intent. The completion of these is subject to due diligence and closing conditions.
TRNO’s Development and Redevelopment Activity
As of March 31, 2025, Terreno had five properties under development or redevelopment. Post completion, these will comprise eight buildings spanning around 0.8 million square feet, which are 48% leased. The company also has around 22.4 acres of land dedicated to future developments at an estimated investment value of around $392.8 million.