Terreno Realty TRNO recently announced the execution of a 35,000 square foot renewal lease and a 30,000 square foot expansion lease in Santa Clara, CA. The lessee of the agreement is a designer and developer of eVTOL aircraft.
The renewal lease will commence upon expiration of the existing lease in September 2025, and the expansion lease will commence in August 2025. Both leases are scheduled to expire in August 2028.
TRNO, which acquires, owns and operates industrial real estate in six major coastal U.S. markets, has been experiencing healthy demand for its properties from both new and existing tenants.
Apart from the above lease, in the last week of June 2025, this real estate investment trust (REIT) announced the execution of an 81,000 square foot lease in Avenel, NJ, with a third-party logistics provider.
TRNO’s Q1 2025 Leasing Details
TRNO is experiencing healthy leasing activity, as evident in its performance in the first quarter of 2025. Its operating portfolio was 96.6% leased to 663 tenants as of March 31, 2025. TRNO’s same-store portfolio of 15.6 million square feet was 97.4% leased as of March 31, 2025. For the company’s improved land portfolio of 47 parcels spanning 150.6 acres, the leased rate was 95.1% as of March 31, 2025.
Terreno Realty was able to lock in higher rents on new and renewed leases during the quarter. The cash rents on new and renewed leases commencing during the first quarter of 2025 climbed 34.2%. Moreover, the tenant retention ratio was 71.7% for the operating portfolio.
TRNO: In a Nutshell
With a solid operating platform, a healthy balance sheet position and strategic expansion moves, TRNO seems well-positioned to capitalize on long-term growth opportunities. However, amid macroeconomic uncertainty and geopolitical issues, customers remain focused on cost controls and delay their decision-making with respect to leasing. This is a concern for the company.
Over the past three months, shares of this Zacks Rank #4 (Sell) company have gained 2.7% compared with the industry’s upside of 8.9%.
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Stocks to Consider
Some better-ranked stocks from the broader REIT sector include SBA Communications SBAC and Omega Healthcare Investors OHI, each carrying a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The Zacks Consensus Estimate for SBAC’s 2025 FFO per share has moved 6 cents northward to $12.74 over the past two months.
The Zacks Consensus Estimate for OHI’s 2025 FFO per share has moved a cent northward to $3.03 over the past week.
Story ContinuesNote: Anything related to earnings presented in this write-up represents funds from operations (FFO), a widely used metric to gauge the performance of REITs.
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This article originally published on Zacks Investment Research (zacks.com).
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