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Section 1: 8-K (8-K)

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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549  
 
FORM 8-K  
 
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): February 11, 2020
 
REXFORD INDUSTRIAL REALTY, INC.
(Exact name of registrant as specified in its charter) 
 
 
Maryland
 
001-36008
 
46-2024407
(State or other jurisdiction of
incorporation)
 
(Commission File Number)
 
(IRS Employer Identification No.)
11620 Wilshire Boulevard, Suite 1000
 
 
 Los Angeles
 
 
California
 
90025
(Address of principal executive offices)
 
(Zip Code)
Registrant’s telephone number, including area code: (310966-1680

N/A
(Former name or former address, if changed since last report.)
 
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
 
 
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
 
 
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
 
 
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:
Title of each class
 
Trading symbols
 
Name of each exchange on which registered
Common Stock, $0.01 par value
 
REXR
 
New York Stock Exchange
5.875% Series A Cumulative Redeemable Preferred Stock
 
REXR-PA
 
New York Stock Exchange
5.875% Series B Cumulative Redeemable Preferred Stock
 
REXR-PB
 
New York Stock Exchange
5.625% Series C Cumulative Redeemable Preferred Stock
 
REXR-PC
 
New York Stock Exchange
 Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
 





ITEM 2.02 RESULTS OF OPERATIONS AND FINANCIAL CONDITION
On February 11, 2020, Rexford Industrial Realty, Inc. (“Rexford Industrial”) issued a press release announcing its earnings for the quarter ended December 31, 2019, and distributed certain supplemental financial information. On February 11, 2020, Rexford Industrial also posted the supplemental financial information on its website located at www.rexfordindustrial.com.  Copies of the press release and supplemental financial information are furnished herewith as Exhibits 99.1 and 99.2, respectively.
The information included in this Current Report on Form 8-K under this Item 2.02 (including Exhibits 99.1 and 99.2 hereto) are being “furnished” and shall not be deemed to be “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of the Exchange Act, nor shall it be incorporated by reference into a filing under the Securities Act of 1933, as amended (the “Securities Act”), or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.

ITEM 7.01 REGULATION FD DISCLOSURE  
As discussed in Item 2.02 above, Rexford Industrial issued a press release announcing its earnings for the quarter ended December 31, 2019 and distributed certain supplemental information. On February 11, 2020, Rexford Industrial also posted the supplemental financial information on its website located at www.rexfordindustrial.com.  
The information included in this Current Report on Form 8-K under this Item 7.01 (including Exhibit 99.1 and 99.2 hereto) is being “furnished” and shall not be deemed to be “filed” for the purposes of the Exchange Act, or otherwise subject to the liabilities of the Exchange Act, nor shall it be incorporated by reference into a filing under the Securities Act or the Exchange Act, except as shall be expressly set forth by specific reference in such filing. The information included in this Current Report on Form 8-K under this Item 7.01 (including Exhibit 99.1 and 99.2 hereto) will not be deemed an admission as to the materiality of any information required to be disclosed solely to satisfy the requirements of Regulation FD.

ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS
(d)    Exhibits.
 
Exhibit
Number
  
Description
99.1
 
Press Release Dated February 11, 2020
 
 
 
99.2
 
Fourth Quarter 2019 Supplemental Financial Report
 
 
 
104
 
Cover Page Interactive Data File (embedded within the Inline XBRL document)






SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
 
 
Rexford Industrial Realty, Inc.
February 11, 2020
 
/s/ Michael S. Frankel
 
Michael S. Frankel
Co-Chief Executive Officer
(Principal Executive Officer)
 
 
 
Rexford Industrial Realty, Inc.
February 11, 2020
 
/s/ Howard Schwimmer
 
Howard Schwimmer
Co-Chief Executive Officer
(Principal Executive Officer)






EXHIBIT INDEX

Exhibit
Number
  
Description
99.1
  
 
 
 
99.2
  
 
 
 
104
 
Cover Page Interactive Data File (embedded within the Inline XBRL document)



(Back To Top)

Section 2: EX-99.1 (EXHIBIT 99.1)

Exhibit
Exhibit 99.1

402749146_rexlogo11520.jpg
REXFORD INDUSTRIAL ANNOUNCES FOURTH QUARTER AND FULL YEAR 2019 FINANCIAL RESULTS

- 4Q 2019 Net Income Attributable to Common Stockholders of $19.9M, or $0.18 per Diluted Share -
- 4Q 2019 Company Share of Core FFO of $35.8M, Up 31.4% Compared to 4Q 2018 -
- 4Q 2019 Company Share of Core FFO of $0.32 per Diluted Share, Up 10.3% Compared to 4Q 2018 -
- 4Q 2019 Stabilized Same Property Portfolio NOI and Cash NOI Up 4.1% and 5.1%, Respectively, Over 4Q 2018 -
- 4Q 2019 GAAP Releasing Spreads of 42.0% and Cash Releasing Spreads of 27.1% -
- Increases 2020 Quarterly Dividend by 16.2% to $0.215 Per Share -
- Introduces Core FFO 2020 Guidance Range of $1.30 to $1.32 per Diluted Share -

Los Angeles, California - February 11, 2020 - Rexford Industrial Realty, Inc. (the “Company” or “Rexford Industrial”) (NYSE: REXR), a real estate investment trust (“REIT”) focused on creating value by investing in and operating industrial properties in Southern California infill markets, today announced financial and operating results for the fourth quarter and full year 2019.

Fourth Quarter 2019 Financial and Operational Highlights:
Net income attributable to common stockholders of $0.18 per diluted share compared to $0.13 per diluted share for the fourth quarter of last year.
Company share of Core FFO increased 31.4% to $35.8 million year-over-year.
Company share of Core FFO per diluted share increased 10.3% to $0.32 per diluted share year-over-year.
Consolidated Portfolio Net Operating Income (NOI) of $55.9 million, an increase of 31.5% year-over-year.
Consolidated Portfolio Cash NOI of $51.5 million, representing an increase of 30.7% year-over-year.
Same Property Portfolio GAAP and Cash NOI increased 5.5% and 7.2%, respectively, year-over-year.
Stabilized Same Property Portfolio GAAP and Cash NOI increased 4.1% and 5.1%, respectively, year-over-year.
Comparable rental rates on 1,461,431 rentable square feet of new and renewal leases were 42.0% higher than prior rents on a GAAP basis and 27.1% higher on a cash basis.
Acquired ten industrial properties for an aggregate purchase price of $258.1 million.

Full Year 2019 Financial and Operational Highlights:
Net income attributable to common stockholders of $0.47 per diluted share compared to $0.41 per diluted share for the full year 2018.
Company share of Core FFO increased 34.3% to $131.1 million year-over-year.
Company share of Core FFO per diluted share increased 9.8% to $1.23 per diluted share year-over-year
At December 31, 2019, the Stabilized Same Property Portfolio occupancy was 97.6% and the Same Property Portfolio occupancy, inclusive of assets in value-add repositioning, was 97.4%.
At December 31, 2019, the consolidated portfolio, excluding approximately 0.5 million rentable square feet of repositioning assets, was 98.0% leased and 97.9% occupied and the consolidated portfolio, inclusive of such repositioning assets, was 96.3% leased and 96.1% occupied.
Acquired 40 industrial properties for an aggregate purchase price of $970.7 million.
Year-end Company leverage measured by a debt-to-enterprise value ratio of 12.3%.
The Company increased its 2020 quarterly dividend by 16.2% to $0.215 per share.





"We’d like to thank the entire Rexford Industrial team for their extraordinary focus and dedication resulting in our exceptional fourth quarter and full year 2019 results. We achieved Core FFO growth of 31.4% for the fourth quarter 2019 and 34.3% for the full year 2019, driven by, among other factors: a) robust tenant demand enabling fourth quarter GAAP and cash re-leasing spreads of 42.0% and 27.1%, respectively, b) completion of 876,131 square feet of repositioning projects generating an aggregate 8.1% stabilized unlevered yield on cost, and c) the completion of 34 investments for an aggregate purchase price of $970.7 million, representing a 24.7% increase in portfolio square footage,” stated Michael Frankel and Howard Schwimmer, Co-Chief Executive Officers of the Company. “We generated an increase in Core FFO per share of 10.3% and 9.8%, respectively, for the quarter and full year, while maintaining a fortress-like, low-leverage balance sheet that ended the year at a debt-to-enterprise value ratio of 12.3%. Our sustained growth enabled us to increase our quarterly dividend by 16.2%, representing a total increase in our dividend of 79.2% since our 2013 initial public offering. Looking forward, we couldn’t be more excited at the quality of internal and external growth opportunities before us as we remain focused on creating value for shareholders by investing in and improving industrial property throughout infill Southern California’s highly-sought-after industrial property markets.”

Financial Results:

The Company reported net income attributable to common stockholders of $19.9 million, or $0.18 per diluted share, for the three months ended December 31, 2019, as compared to net income attributable to common stockholders of $12.4 million, or $0.13 per diluted share, for the three months ended December 31, 2018.

The Company reported net income attributable to common stockholders of $50.5 million, or $0.47 per diluted share, for the year ended December 31, 2019, as compared to net income attributable to common stockholders of $36.1 million, or $0.41 per diluted share, for the year ended December 31, 2018. Net income for the year ended December 31, 2019, includes $16.3 million of gains on sale of real estate, as compared to $17.2 million for the year ended December 31, 2018.

The Company reported Company share of Core FFO of $35.8 million, or $0.32 per diluted share of common stock, for the three months ended December 31, 2019, as compared to Company share of Core FFO of $27.2 million, or $0.29 per diluted share of common stock, for the three months ended December 31, 2018. Amounts are adjusted for non-core expenses of $(3) thousand for the three months ended December 31, 2019, and $0.2 million for the three months ended December 31, 2018.

The Company reported Company share of Core FFO of $131.1 million, or $1.23 per diluted share of common stock, for the year ended December 31, 2019, as compared to Company share of Core FFO of $97.6 million, or $1.12 per diluted share of common stock, for the year ended December 31, 2018. Amounts are adjusted for non-core expenses of $0.2 million for the year ended December 31, 2019, and $0.3 million for the year ended December 31, 2018.

For the three months ended December 31, 2019, the Company’s consolidated portfolio NOI increased 31.5% compared to the three months ended December 31, 2018, and the Company’s consolidated portfolio Cash NOI increased 30.7% compared to the three months ended December 31, 2018.

For the year ended December 31, 2019, the Company’s consolidated portfolio NOI increased 26.4% compared to the year ended December 31, 2018, and the Company’s consolidated portfolio Cash NOI increased 26.6% compared to the year ended December 31, 2018.

For the three months ended December 31, 2019, the Company’s Same Property Portfolio NOI increased 5.5% compared to the fourth quarter of 2018, driven by a 6.7% increase in Same Property Portfolio rental income and a 10.5% increase in Same Property Portfolio expenses, driven in part by unfavorable supplemental property tax adjustments recorded in the fourth quarter of 2019 as compared to favorable supplemental property tax adjustments recorded in the fourth quarter of 2018. Same Property Portfolio Cash NOI increased 7.2% compared to the fourth quarter of 2018. Stabilized Same Property Portfolio NOI increased 4.1% in the fourth quarter of 2019 compared to the fourth quarter of 2018 and Stabilized Same Property Portfolio Cash NOI increased 5.1% in the fourth quarter of 2019 compared to the fourth quarter of 2018.





For the year ended December 31, 2019, the Company’s Same Property Portfolio NOI increased 6.2% compared to the year ended December 31, 2018, driven by a 5.7% increase in Same Property Portfolio rental income and a 3.9% increase in Same Property Portfolio expenses. Same Property Portfolio Cash NOI increased 8.7% compared to the year ended December 31, 2018. Stabilized Same Property Portfolio NOI increased 3.7% during the year ended December 31, 2019, compared to the year ended December 31, 2018, and Stabilized Same Property Portfolio Cash NOI increased 6.1% during the year ended December 31, 2019, compared to the year ended December 31, 2018.

Operating Results:

During the fourth quarter of 2019, the Company signed 115 new and renewal leases totaling 1,461,431 rentable square feet. Average rental rates on comparable new and renewal leases were up 42.0% on a GAAP basis and up 27.1% on a cash basis. The Company signed 49 new leases for 439,138 rentable square feet, with GAAP rents up 63.0% compared to the prior in-place leases. The Company signed 66 renewal leases for 1,022,293 rentable square feet, with GAAP rents up 37.5% compared to the prior in-place leases. For the 49 new leases, cash rents increased 43.3%, and for the 66 renewal leases, cash rents were up 23.5%, compared to the ending cash rents for the prior leases.

At December 31, 2019, the Stabilized Same Property Portfolio occupancy was 97.6% and the Same Property Portfolio occupancy, including value-add repositioning assets, was 97.4%. At December 31, 2019, the Company’s consolidated portfolio, excluding value-add repositioning assets, was 97.9% occupied and the Company’s consolidated portfolio, including value-add repositioning assets, was 96.1% occupied.

The Company has included in a supplemental information package the detailed results and operating statistics that reflect the activities of the Company for the three months ended December 31, 2019. See below for information regarding the supplemental information package. 

Transaction Activity:

In the fourth quarter 2019, the Company acquired 10 properties, for an aggregate purchase price of $258.1 million, as detailed below. Additionally, the Company sold two properties for an aggregate sale price of $20.8 million.

In October 2019, the Company acquired:
Slauson Commerce Center/6277-6289 E. Slauson Avenue, a 98% leased industrial complex containing 336,085 square feet on 10.51 acres of land, located in the Central Los Angeles submarket, for $41.3 million or $123 per square foot.
750 W. Manville Street, a 100% leased single-tenant industrial building containing 59,996 square feet on 2.76 acres of land, located in the Los Angeles - South Bay submarket, for $11.5 million, or $192 per square foot.
8985 Crestmar Point, an 88% leased two-tenant industrial building containing 55,816 square feet on 3.42 acres of land, located in the Central San Diego submarket, for $8.0 million, or $143 per square foot.

In November 2019, the Company acquired:
404-430 Berry Way, a 100% leased three-building industrial complex containing 120,250 square feet on 11.79 acres of land, located in the North Orange County submarket, for $27.6 million, or $54 per land square foot.
415 South Motor Avenue, a 4.2 acre land parcel, located in the Los Angeles - San Gabriel Valley submarket, for $7.2 million, or $39 per land square foot.
508 East E Street, a 100% leased three-tenant industrial building containing 57,522 square feet on 3.45 acres of land, located in the Los Angeles - South Bay submarket, for $14.89 million, or $259 per square foot.
12752-12822 Monarch Street, a 93% leased two-building industrial complex containing 276,585 square feet on 11.1 acres of land, located in the West Orange County submarket, for $34.0 million or $123 per square foot.

In December 2019, the Company acquired:




Pomona Distribution Center/1601 Mission Boulevard, a 100% leased two-tenant industrial building containing 751,528 square feet on 32.2 acres of land, located in the Los Angeles - San Gabriel Valley submarket, for $87.8 million or $117 per square foot.
2757 E. Del Amo Boulevard, a 100% leased single tenant industrial building containing 57,300 square feet on 3.48 acres of land, located in the Los Angeles - South Bay submarket, for $11.9 million or $208 per square foot.
18250 Euclid Street, a 100% leased single tenant industrial building containing 62,838 square feet on 3.54 acres of land, located in the West Orange County submarket, for $14.0 million or $223 per square foot.

In October, the Company sold 13914-13928 East Valley Boulevard, a 100% leased multi-tenant industrial park containing 58,084 square feet, located in the Los Angeles - San Gabriel Valley submarket, for $11.2 million, or $192 per square foot.

In December, the Company sold Eastman Business Park, an 89% leased multi-tenant industrial park containing 55,321 square feet, located in the Ventura County submarket for $9.6 million, or $173 per square foot.

Balance Sheet:
  
During the quarter ended December 31, 2019, the Company issued 2,972,129 shares of common stock under its at-the-market equity offering program (ATM program). The shares were issued at a weighted average price of $46.77 per share, providing gross proceeds of approximately $139.0 million and net proceeds of approximately $136.9 million. As of December 31, 2019, the current ATM program had approximately $344.1 million of remaining capacity.

As of December 31, 2019, the Company had $861.0 million of outstanding debt, with an average interest rate of 3.54% and an average term-to-maturity of 5.5 years. As of December 31, 2019, $802.5 million, or 93%, of the Company’s outstanding debt was fixed-rate with an average interest rate of 3.55% and an average term-to-maturity of 5.7 years. The remaining $58.5 million, or 7%, of the Company’s outstanding debt was floating-rate, with an average interest rate of LIBOR + 1.70% and an average term-to-maturity of 3.6 years.

Guidance

The Company is introducing its full year 2020 guidance as follows:
Net income attributable to common stockholders within a range of $0.37 to $0.39 per diluted share
Company share of Core FFO within a range of $1.30 to $1.32 per diluted share
Year-end Stabilized Same Property Portfolio occupancy within a range of 96.0% to 97.0%
Stabilized Same Property Portfolio NOI growth for the year within a range of 3.7% to 4.2%
General and administrative expenses within a range of $36.5 million to $37.0 million

The Core FFO guidance refers only to the Company’s in-place portfolio as of February 11, 2020, and the pending acquisition of a portfolio of 11 properties (the “Pending Portfolio”) that is expected to close no later than April 21, 2020 (for additional details, refer to the Company’s Form 8-K that was filed with Securities and Exchange Commission on December 23, 2019). Our guidance does not include any assumptions for other acquisitions, dispositions or balance sheet activities that may or may not occur through the end of the year. A number of factors could impact the Company’s ability to deliver results in line with its guidance, including, but not limited to, interest rates, the economy, the supply and demand of industrial real estate, failure to satisfy the closing conditions for the Pending Portfolio, the availability and terms of financing to the Company or to potential acquirers of real estate and the timing and yields for divestment and investment. There can be no assurance that the Company can achieve such results.

Dividends:

On February 10, 2020, the Company’s Board of Directors declared a dividend in the amount of $0.215 per share for the first quarter of 2020, payable in cash on April 15, 2020, to common stockholders and common unit holders of record as of March 31, 2020. The new divided rate represents a 16.2% increase from the prior rate of $0.185 per share.
 




On February 10, 2020, the Company’s Board of Directors declared a quarterly dividend of $0.367188 per share of its Series A Cumulative Redeemable Preferred Stock, a quarterly dividend of $0.367188 per share of its Series B Cumulative Redeemable Preferred Stock and a quarterly dividend of $0.351563 per share of its Series C Cumulative Redeemable Preferred Stock, in each case, payable in cash on March 31, 2020, to preferred stockholders of record as of March 13, 2020.

Supplemental Information:

Details regarding these results can be found in the Company’s supplemental financial package available on the Company’s investor relations website at www.ir.rexfordindustrial.com.

Earnings Release, Investor Conference Webcast and Conference Call:

The Company will host a webcast and conference call on Wednesday, February 12, 2020, at 1:00 p.m. Eastern Time to review fourth quarter results and discuss recent events. The live webcast will be available on the Company’s investor relations website at ir.rexfordindustrial.com. To participate in the call, please dial 877-407-0789 (domestic) or 201-689-8562 (international). A replay of the conference call will be available through March 12, 2020, by dialing 844-512-2921 (domestic) or 412-317-6671 (international) and entering the pass code 13698187.

About Rexford Industrial:

Rexford Industrial, a real estate investment trust focused on owning and operating industrial properties throughout Southern California infill markets, owns 213 properties with approximately 26.6 million rentable square feet and manages an additional 19 properties with approximately 1.0 million rentable square feet.
For additional information, visit www.rexfordindustrial.com.


Forward Looking Statements:

This press release may contain forward-looking statements within the meaning of the federal securities laws, which are based on current expectations, forecasts and assumptions that involve risks and uncertainties that could cause actual outcomes and results to differ materially. Forward-looking statements relate to expectations, beliefs, projections, future plans and strategies, anticipated events or trends and similar expressions concerning matters that are not historical facts. In some cases, you can identify forward-looking statements by the use of forward-looking terminology such as “may,” “will,” “should,” “expects,” “intends,” “plans,” “anticipates,” “believes,” “estimates,” “predicts,” or “potential” or the negative of these words and phrases or similar words or phrases which are predictions of or indicate future events or trends and which do not relate solely to historical matters. While forward-looking statements reflect the Company’s good faith beliefs, assumptions and expectations, they are not guarantees of future performance. For a further discussion of these and other factors that could cause the Company’s future results to differ materially from any forward-looking statements, see the reports and other filings by the Company with the U.S. Securities and Exchange Commission, including the Company’s Annual Report on Form 10-K for the year ended December 31, 2018, and subsequent filings with the Securities and Exchange Commission. The Company disclaims any obligation to publicly update or revise any forward-looking statement to reflect changes in underlying assumptions or factors, of new information, data or methods, future events or other changes.
  




Definitions / Discussion of Non-GAAP Financial Measures:

Funds from Operations (FFO): We calculate FFO in accordance with the standards established by the National Association of Real Estate Investment Trusts (“NAREIT”). FFO represents net income (loss) (computed in accordance with GAAP), excluding gains (or losses) from sales of depreciable operating property, impairment losses, real estate related depreciation and amortization (excluding amortization of deferred financing costs) and after adjustments for unconsolidated partnerships and joint ventures. Management uses FFO as a supplemental performance measure because, in excluding real estate related depreciation and amortization, gains and losses from property dispositions, other than temporary impairments of unconsolidated real estate entities, and impairment on our investment in real estate, it provides a performance measure that, when compared year over year, captures trends in occupancy rates, rental rates and operating costs. We also believe that, as a widely recognized measure of performance used by other REITs, FFO may be used by investors as a basis to compare our operating performance with that of other REITs. However, because FFO excludes depreciation and amortization and captures neither the changes in the value of our properties that result from use or market conditions nor the level of capital expenditures and leasing commissions necessary to maintain the operating performance of our properties, all of which have real economic effects and could materially impact our results from operations, the utility of FFO as a measure of our performance is limited. Other equity REITs may not calculate or interpret FFO in accordance with the NAREIT definition as we do, and, accordingly, our FFO may not be comparable to such other REITs’ FFO. FFO should not be used as a measure of our liquidity and is not indicative of funds available for our cash needs, including our ability to pay dividends. FFO should be considered only as a supplement to net income computed in accordance with GAAP as a measure of our performance. A reconciliation of net income, the nearest GAAP equivalent, to FFO is set forth below.

Core Funds from Operations (Core FFO): We calculate Core FFO by adjusting FFO to exclude the impact of certain items that we do not consider reflective of our core revenue or expense streams. These adjustments consist of acquisition expenses. Management believes that Core FFO is a useful supplemental measure as it provides a more meaningful and consistent comparison of operating performance and allows investors to more easily compare the Company’s operating results. Because certain of these adjustments have a real economic impact on our financial condition and results from operations, the utility of Core FFO as a measure of our performance is limited. Other REITs may not calculate Core FFO in a consistent manner. Accordingly, our Core FFO may not be comparable to other REITs’ Core FFO. Core FFO should be considered only as a supplement to net income computed in accordance with GAAP as a measure of our performance. A reconciliation of FFO to Core FFO is set forth below.
Reconciliation of Net Income Attributable to Common Stockholders per Diluted Share Guidance to Company share of Core FFO per Diluted Share Guidance: The following is a reconciliation of the Company’s 2020 guidance range of net income attributable to common stockholders per diluted share, the most directly comparable forward-looking GAAP financial measure, to Company share of Core FFO per diluted share.
 
2020 Estimate
 
Low
 
High
Net income attributable to common stockholders
$
0.37

 
$
0.39

Company share of depreciation and amortization
$
0.93

 
$
0.93

Company share of Core FFO
$
1.30

 
$
1.32



Net Operating Income (NOI): NOI is a non-GAAP measure, which includes the revenue and expense directly attributable to our real estate properties. NOI is calculated as rental income from real estate operations less property expenses (before interest expense, depreciation and amortization). We use NOI as a supplemental performance measure because, in excluding real estate depreciation and amortization expense and gains (or losses) from property dispositions, it provides a performance measure that, when compared year over year, captures trends in occupancy rates, rental rates and operating costs. We also believe that NOI will be useful to investors as a basis to compare our operating performance with that of other REITs. However, because NOI excludes depreciation and amortization expense and captures neither the changes in the value of our properties that result from use or market conditions, nor the level of capital expenditures and leasing commissions necessary to maintain the operating performance of our properties (all of which have a real economic effect and could materially impact our results from operations), the utility of NOI as a measure of our performance is limited. Other equity REITs may not calculate NOI in a similar manner and, accordingly, our NOI may not be comparable to such other REITs’ NOI. Accordingly, NOI should be considered only as a supplement to net income as a measure of




our performance. NOI should not be used as a measure of our liquidity, nor is it indicative of funds available to fund our cash needs.

NOI should not be used as a substitute for cash flow from operating activities in accordance with GAAP. We use NOI to help evaluate the performance of the Company as a whole, as well as the performance of our Same Property Portfolio and Stabilized Same Property Portfolio. A calculation of NOI for our Same Property Portfolio, as well as a reconciliation of net income to NOI for our Same Property Portfolio and Stabilized Same Property Portfolio, is set forth below.

Cash NOI: Cash NOI is a non-GAAP measure, which we calculate by adding or subtracting from NOI i) fair value lease revenue and ii) straight-line rent adjustments. We use Cash NOI, together with NOI, as a supplemental performance measure. Cash NOI should not be used as a measure of our liquidity, nor is it indicative of funds available to fund our cash needs. Cash NOI should not be used as a substitute for cash flow from operating activities computed in accordance with GAAP. We use Cash NOI to help evaluate the performance of the Company as a whole, as well as the performance of our Same Property Portfolio. A calculation of Cash NOI for our Same Property Portfolio, as well as a reconciliation of net income to Cash NOI for our Same Property Portfolio and Stabilized Same Property Portfolio, is set forth below.

Same Property Portfolio: Our Same Property Portfolio is a subset of our consolidated portfolio and includes properties that were wholly-owned by us as of January 1, 2018, and still owned by us as of December 31, 2019. Therefore, we excluded from our Same Property Portfolio any properties that were acquired or sold during the period from January 1, 2018 through December 31, 2019. The Company’s computation of same property performance may not be comparable to other REITs.

Stabilized Same Property Portfolio: Our Stabilized Same Property Portfolio represents the properties included in our Same Property Portfolio, adjusted to exclude the properties listed in the table below that were under repositioning/lease-up during comparable years.

Stabilized Same Property Portfolio occupancy/leasing statistics excludes vacant/unleased repositioning space at each of these properties as of the end of each reporting period. Stabilized Same Property Portfolio NOI excludes the NOI for the entire property for all comparable periods.
Our 2019 Stabilized Same Property Portfolio excludes the following Same Property Portfolio properties that were in various stages of repositioning or lease-up during 2018 and 2019:
14748-14750 Nelson Avenue
 
301-445 Figueroa Street
15401 Figueroa Street
 
3233 Mission Oaks Boulevard
1601 Alton Parkway
 
7110 E. Rosecrans Avenue
2700-2722 Fairview Street
 
9615 Norwalk Boulevard
28903 Avenue Paine
 
 

As of December 31, 2019, the difference between our 2019 Same Property Portfolio and our 2019 Stabilized Same Property Portfolio is 37,417 rentable square feet of space at one of our properties that was classified as repositioning or lease-up.
As of December 31, 2018, the difference between our 2019 Same Property Portfolio and our 2019 Stabilized Same Property Portfolio is space aggregating 247,615 rentable square feet at five of our properties that were in various stages of repositioning or lease-up.
Our 2020 Stabilized Same Property Portfolio is a subset of our consolidated portfolio and includes properties that were wholly owned by us for the period from January 1, 2019 through February 11, 2020, and that were stabilized as of January 1, 2019. Therefore, our 2020 Stabilized Same Property Portfolio excludes the properties listed below that were or will be classified as repositioning (current and future) or lease-up during 2019 and 2020. As of January 1, 2020, our 2020 Stabilized Same Property Portfolio consists of 160 properties aggregating 19,791,344 rentable square feet.




1210 N. Red Gum Street
 
2700-2722 Fairview Street
1332-1340 Rocky Point Drive
 
28903 Avenue Paine
14748-14750 Nelson Avenue
 
29003 Avenue Sherman
15401 Figueroa Street
 
3233 Mission Oaks Boulevard
1580 Carson Street
 
7110 E. Rosecrans Avenue
16121 Carmenita Road
 
851 Lawrence Drive
1998 Surveyor Avenue
 
9615 Norwalk Boulevard

Properties and Space Under Repositioning: Typically defined as properties or units where a significant amount of space is held vacant in order to implement capital improvements that improve the functionality (not including basic refurbishments, i.e., paint and carpet), cash flow and value of that space. We define a significant amount of space at a property as the lower of (i) 35,000 square feet of space or (ii) 50% of a property’s square footage. Typically, we would include properties or space where the repositioning and lease-up time frame is estimated to be greater than six months. A repositioning is considered complete once the investment is fully or nearly fully deployed and the property is marketable for leasing. We consider a repositioning property to be stabilized at the earlier of the following: (i) upon reaching 90% occupancy or (ii) one year from the date of completion of repositioning construction work. We look to update this definition on an annual basis based on the growth and size of the Company’s consolidated portfolio.

Contact:
Investor Relations:

Stephen Swett
424-256-2153 ext 401
[email protected]




Rexford Industrial Realty, Inc.
Consolidated Balance Sheets
(In thousands except share data)

 
 
December 31, 2019
 
December 31, 2018
 
(unaudited)
 
 
ASSETS
 
 
 
Land
$
1,927,098

 
$
1,298,957

Buildings and improvements
1,680,178

 
1,332,438

Tenant improvements
72,179

 
60,024

Furniture, fixtures, and equipment
141

 
149

Construction in progress
18,794

 
24,515

Total real estate held for investment
3,698,390

 
2,716,083

Accumulated depreciation
(296,777
)
 
(228,742
)
Investments in real estate, net
3,401,613

 
2,487,341

Cash and cash equivalents
78,857

 
180,601

Rents and other receivables, net
5,889

 
4,944

Deferred rent receivable, net
29,671

 
22,228

Deferred leasing costs, net
18,688

 
14,002

Deferred loan costs, net
695

 
1,312

Acquired lease intangible assets, net
73,090

 
55,683

Acquired indefinite-lived intangible
5,156

 
5,156

Interest rate swap asset
766

 
8,770

Other assets
9,671

 
6,723

Acquisition related deposits
14,526

 
925

Total Assets
$
3,638,622

 
$
2,787,685

LIABILITIES & EQUITY
 
 
 
Liabilities
 
 
 
Notes payable
$
857,842

 
$
757,371

Interest rate swap liability
8,488

 
2,351

Accounts payable, accrued expenses and other liabilities
31,112

 
21,074

Dividends payable
21,624

 
15,938

Acquired lease intangible liabilities, net
59,340

 
52,727

Tenant security deposits
28,779

 
23,262

Prepaid rents
8,988

 
6,539

Total Liabilities
1,016,173

 
879,262

Equity
 
 
 
Rexford Industrial Realty, Inc. stockholders’ equity
 
 
 
Preferred stock, $0.01 par value per share, 10,050,000 and 10,000,000 shares authorized, at December 31, 2019 and December 31, 2018, respectively
 
 
 
5.875% series A cumulative redeemable preferred stock, 3,600,000 shares outstanding at December 31, 2019 and December 31, 2018 ($90,000 liquidation preference)
86,651

 
86,651

5.875% series B cumulative redeemable preferred stock, 3,000,000 shares outstanding at December 31, 2019 and December 31, 2018 ($75,000 liquidation preference)
72,443

 
72,443

5.625% series C cumulative redeemable preferred stock, 3,450,000 and zero shares outstanding at December 31, 2019 and December 31, 2018, respectively ($86,250 liquidation preference)
83,233

 

Common Stock, $0.01 par value per share, 489,950,000 and 490,000,000 authorized and 113,793,300 and 96,810,504 shares outstanding at December 31, 2019 and December 31, 2018, respectively
1,136

 
966

Additional paid in capital
2,439,007

 
1,798,113

Cumulative distributions in excess of earnings
(118,751
)
 
(88,341
)
Accumulated other comprehensive income
(7,542
)
 
6,262

Total stockholders’ equity
2,556,177

 
1,876,094

Noncontrolling interests
66,272

 
32,329

Total Equity
2,622,449

 
1,908,423

Total Liabilities and Equity
$
3,638,622

 
$
2,787,685





Rexford Industrial Realty, Inc.
Consolidated Statements of Operations
(Unaudited and in thousands, except per share data)


 
Three Months Ended December 31,
 
Year Ended December 31,
 
2019
 
2018
 
2019
 
2018
REVENUES
 
 
 
 
 
 
 
Rental income
74,015

 
56,125

 
264,252

 
210,643

Management, leasing and development services
105

 
114

 
406

 
473

Interest income
279

 
769

 
2,555

 
1,378

TOTAL REVENUES
74,399

 
57,008

 
267,213

 
212,494

OPERATING EXPENSES
 
 
 
 
 
 
 
Property expenses
18,156

 
13,642

 
63,272

 
51,671

General and administrative
8,215

 
6,297

 
30,300

 
25,194

Depreciation and amortization
26,877

 
20,671

 
98,891

 
80,042

TOTAL OPERATING EXPENSES
53,248

 
40,610

 
192,463

 
156,907

OTHER EXPENSES
 
 
 
 
 
 
 
Acquisition expenses
(3
)
 
166

 
171

 
318

Interest expense
7,364

 
6,656

 
26,875

 
25,416

TOTAL EXPENSES
60,609

 
47,432

 
219,509

 
182,641

Gains on sale of real estate
10,592

 
5,631

 
16,297

 
17,222

NET INCOME
24,382

 
15,207

 
64,001

 
47,075

Less: net income attributable to noncontrolling interest
(734
)
 
(277
)
 
(2,022
)
 
(865
)
NET INCOME ATTRIBUTABLE TO REXFORD INDUSTRIAL REALTY, INC.
23,648

 
14,930

 
61,979

 
46,210

Less: preferred stock dividends
(3,636
)
 
(2,424
)
 
(11,055
)
 
(9,694
)
Less: earnings attributable to participating securities
(108
)
 
(93
)
 
(447
)
 
(378
)
NET INCOME ATTRIBUTABLE TO COMMON STOCKHOLDERS
$
19,904

 
$
12,413

 
$
50,477

 
$
36,138

Net income attributable to common stockholders per share  basic
$
0.18

 
$
0.13

 
$
0.47

 
$
0.42

Net income attributable to common stockholders per share  diluted
$
0.18

 
$
0.13

 
$
0.47

 
$
0.41

Weighted-average shares of common stock outstanding – basic
111,612

 
93,996

 
106,407

 
86,824

Weighted-average shares of common stock outstanding – diluted
112,097

 
94,488

 
106,799

 
87,336






Rexford Industrial Realty, Inc.
Same Property Portfolio Occupancy and NOI and Cash NOI
(Unaudited, dollars in thousands)
 
 
Same Property Portfolio Occupancy:
 
 
 
 
 
 
 
December 31, 2019
 
December 31, 2018
 
Change (basis points)
 
Same Property
Portfolio
 
Stabilized
Same
Property
Portfolio
(1)
 
Same Property
Portfolio
 
Stabilized
Same
Property
Portfolio
(2)
 
Same Property
Portfolio
 
Stabilized
Same
Property
Portfolio
Occupancy:
 
 
 
 
 
 
 
 
 
 
 
Los Angeles County
97.7%
 
98.1%
 
96.7%
 
97.5%
 
100 bps
 
60 bps
Orange County
96.6%
 
96.6%
 
94.6%
 
97.0%
 
200 bps
 
(40) bps
San Bernardino County
97.5%
 
97.5%
 
96.7%
 
96.7%
 
80 bps
 
80 bps
San Diego County
96.1%
 
96.1%
 
98.6%
 
98.6%
 
(250) bps
 
(250) bps
Ventura County
98.4%
 
98.4%
 
90.9%
 
97.2%
 
750 bps
 
120 bps
Total/Weighted Average
97.4%
 
97.6%
 
96.0%
 
97.4%
 
140 bps
 
20 bps

(1)
Reflects the occupancy of our Same Property Portfolio as of December 31, 2019, adjusted for 37,417 rentable square feet at one property that was in lease-up as of December 31, 2019.
(2)
Reflects the occupancy of our Same Property Portfolio as of December 31, 2018, adjusted for space aggregating 247,615 rentable square feet at five properties that were in various stages of repositioning or lease-up as of December 31, 2018.

Same Property Portfolio NOI and Cash NOI
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Three Months Ended December 31,
 
Year Ended December 31,
 
2019
 
2018
 
$ Change
 
% Change
 
2019
 
2018
 
$ Change
 
% Change
Rental income
$
52,285

 
$
49,009

 
$
3,276

 
6.7%
 
$
203,470

 
$
192,577

 
$
10,893

 
5.7%
Property expenses
12,986

 
11,750

 
1,236

 
10.5%
 
48,692

 
46,886

 
1,806

 
3.9%
Same Property Portfolio NOI
$
39,299

 
$
37,259

 
$
2,040

 
5.5%
 
$
154,778

 
$
145,691

 
$
9,087

 
6.2%
Straight line rental revenue adjustment
(792
)
 
(1,053
)
 
261

 
(24.8)%
 
(3,434
)
 
(5,364
)
 
1,930

 
(36.0)%
Amortization of above/below market lease intangibles
(816
)
 
(1,052
)
 
236

 
(22.4)%
 
(3,671
)
 
(4,496
)
 
825

 
(18.3)%
Same Property Portfolio Cash NOI
$
37,691

 
$
35,154

 
$
2,537

 
7.2%
 
$
147,673

 
$
135,831

 
$
11,842

 
8.7%






Rexford Industrial Realty, Inc.
Reconciliation of Net Income to NOI, Same Property Portfolio NOI, Same Property Portfolio Cash NOI, Stabilized Same Property Portfolio NOI and Stabilized Same Property Portfolio Cash NOI
(Unaudited and in thousands)


 
Three Months Ended December 31,
 
Year Ended December 31,
 
2019
 
2018
 
2019
 
2018
Net income
$
24,382

 
$
15,207

 
$
64,001

 
$
47,075

Add:
 
 
 
 
 
 
 
General and administrative
8,215

 
6,297

 
30,300

 
25,194

Depreciation and amortization
26,877

 
20,671

 
98,891

 
80,042

Acquisition expenses
(3
)
 
166

 
171

 
318

Interest expense
7,364

 
6,656

 
26,875

 
25,416

Deduct:
 
 
 
 
 
 
 
Management, leasing and development services
105

 
114

 
406

 
473

Interest income
279

 
769

 
2,555

 
1,378

Gains on sale of real estate
10,592

 
5,631

 
16,297

 
17,222

Net operating income (NOI)
$
55,859

 
$
42,483

 
$
200,980

 
$
158,972

Non-Same Property Portfolio rental income
(21,730
)
 
(7,116
)
 
(60,782
)
 
(18,066
)
Non-Same Property Portfolio property expenses
5,170

 
1,892

 
14,580

 
4,785

Same Property Portfolio NOI
$
39,299

 
$
37,259

 
$
154,778

 
$
145,691

Straight line rental revenue adjustment
(792
)
 
(1,053
)
 
(3,434
)
 
(5,364
)
Amortization of above/below market lease intangibles
(816
)
 
(1,052
)
 
(3,671
)
 
(4,496
)
Same Property Portfolio Cash NOI
$
37,691

 
$
35,154

 
$
147,673

 
$
135,831

 
 
 
 
 
 
 
 
NOI (from above)
$
55,859

 
$
42,483

 
$
200,980

 
$
158,972

Non-Stabilized Same Property Portfolio rental income
(25,166
)
 
(9,828
)
 
(73,223
)
 
(25,985
)
Non-Stabilized Same Property Portfolio property expenses
5,990

 
2,574

 
17,426

 
6,972

Stabilized Same Property Portfolio NOI
$
36,683

 
$
35,229

 
$
145,183

 
$
139,959

Straight line rental revenue adjustment
(519
)
 
(551
)
 
(2,645
)
 
(4,446
)
Amortization of above/below market lease intangibles
(823
)
 
(1,065
)
 
(3,699
)
 
(4,609
)
Stabilized Same Property Portfolio Cash NOI
$
35,341

 
$
33,613

 
$
138,839

 
$
130,904






Rexford Industrial Realty, Inc.
Reconciliation of Net Income to Funds From Operations and Core Funds From Operations
(Unaudited and in thousands, except per share data)

 
 
Three Months Ended December 31,
 
Year Ended December 31,
 
2019
 
2018
 
2019
 
2018
Net income
$
24,382

 
$
15,207

 
$
64,001

 
$
47,075

Add:
 
 
 
 
 

 
 

Depreciation and amortization
26,877

 
20,671

 
98,891

 
80,042

Deduct:
 
 
 
 
 
 
 
Gains on sale of real estate
10,592

 
5,631

 
16,297

 
17,222

Funds From Operations (FFO)
$
40,667

 
$
30,247

 
$
146,595

 
$
109,895

Less: preferred stock dividends
(3,636
)
 
(2,424
)
 
(11,055
)
 
(9,694
)
Less: FFO attributable to noncontrolling interest(1)
(1,087
)
 
(602
)
 
(3,897
)
 
(2,295
)
Less: FFO attributable to participating securities(2)
(188
)
 
(166
)
 
(733
)
 
(642
)
Company share of FFO
$
35,756

 
$
27,055

 
$
130,910

 
$
97,264

 
 
 
 
 
 
 
 
Company Share of FFO per common share – basic
$
0.32

 
$
0.29

 
$
1.23

 
$
1.12

Company Share of FFO per common share – diluted
$
0.32

 
$
0.29

 
$
1.23

 
$
1.11

 
 
 
 
 
 
 
 
FFO
$
40,667

 
$
30,247

 
$
146,595

 
$
109,895

Adjust:
 
 
 
 
 
 
 
Acquisition expenses
(3
)
 
166

 
171

 
318

Core FFO
$
40,664

 
$
30,413

 
$
146,766

 
$
110,213

Less: preferred stock dividends
(3,636
)
 
(2,424
)
 
(11,055
)
 
(9,694
)
Less: Core FFO attributable to noncontrolling interest(1)
(1,086
)
 
(606
)
 
(3,899
)
 
(2,302
)
Less: Core FFO attributable to participating securities(2)
(188
)
 
(167
)
 
(733
)
 
(645
)
Company share of Core FFO
$
35,754

 
$
27,216

 
$
131,079

 
$
97,572

 
 
 
 
 
 
 
 
Company share of Core FFO per common share – basic
$
0.32

 
$
0.29

 
$
1.23

 
$
1.12

Company share of Core FFO per common share – diluted
$
0.32

 
$
0.29

 
$
1.23

 
$
1.12

 
 
 
 
 
 
 
 
Weighted-average shares of common stock outstanding – basic
111,612

 
93,996

 
106,407

 
86,824

Weighted-average shares of common stock outstanding – diluted
112,097

 
94,488

 
106,799

 
87,336


(1)
Noncontrolling interests relate to interests in the Company’s operating partnership, represented by common units and preferred units (Series 1 CPOP units) of partnership interests in the operating partnership that are owned by unit holders other than the Company.
(2)
Participating securities include unvested shares of restricted stock, unvested LTIP units and unvested performance units.


(Back To Top)

Section 3: EX-99.2 (EXHIBIT 99.2)

Exhibit
Exhibit 99.2

402749146_q419cover.jpg



Table of Contents.
 
 
 
 
 
Section
Page
 
 
Corporate Data:
 
Investor Company Summary
3
Financial and Portfolio Highlights and Common Stock Data
4
Consolidated Financial Results:
 
Consolidated Balance Sheets
5
Consolidated Statements of Operations
6-7
Non-GAAP FFO, Core FFO and AFFO Reconciliations
8-9
Statement of Operations Reconciliations
10
Same Property Portfolio Performance
11
Capitalization Summary
12
Debt Summary
13
Portfolio Data:
 
Portfolio Overview
14
Occupancy and Leasing Trends
15
Leasing Statistics
16-17
Top Tenants and Lease Segmentation
18
Capital Expenditure Summary
19
Properties and Space Under Repositioning/Development
20-21
Current Year Acquisitions and Dispositions Summary
22-23
Guidance
24
Net Asset Value Components
25
Notes and Definitions
26-30
Disclosures:
Forward Looking Statements: This supplemental package contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. We caution investors that any forward-looking statements presented herein are based on management’s beliefs and assumptions and information currently available to management. Such statements are subject to risks, uncertainties and assumptions and may be affected by known and unknown risks, trends, uncertainties and factors that are beyond our control. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those anticipated, estimated or projected. These risks and uncertainties include, without limitation: general risks affecting the real estate industry (including, without limitation, the market value of our properties, the inability to enter into or renew leases at favorable rates, dependence on tenants’ financial condition, and competition from other developers, owners and operators of real estate); risks associated with the disruption of credit markets or a global economic slowdown; risks associated with the potential loss of key personnel (most importantly, members of senior management); risks associated with our failure to maintain our status as a Real Estate Investment Trust under the Internal Revenue Code of 1986, as amended; possible adverse changes in tax and environmental laws; litigation, including costs associated with prosecuting or defending pending or threatened claims and any adverse outcomes, and potential liability for uninsured losses and environmental contamination.
For a further discussion of these and other factors that could cause our future results to differ materially from any forward-looking statements, see Item 1A. Risk Factors in our 2018 Annual Report on Form 10-K, which was filed with the Securities and Exchange Commission (“SEC”) on February 19, 2019. We disclaim any obligation to publicly update or revise any forward-looking statement to reflect changes in underlying assumptions or factors, of new information, data or methods, future events or other changes.

 
Fourth Quarter 2019
Supplemental Financial Reporting Package
Page 2

 402749146_logo3a14.jpg
 


Investor Company Summary.
 
 
 
 
 
Executive Management Team
Howard Schwimmer
 
Co-Chief Executive Officer, Director
Michael S. Frankel
 
Co-Chief Executive Officer, Director
Adeel Khan
 
Chief Financial Officer
David Lanzer
 
General Counsel and Corporate Secretary
Board of Directors
Richard Ziman
 
Chairman
Howard Schwimmer
 
Co-Chief Executive Officer, Director
Michael S. Frankel
 
Co-Chief Executive Officer, Director
Robert L. Antin
 
Director
Steven C. Good
 
Director
Diana J. Ingram
 
Director
Tyler H. Rose
 
Director
Peter Schwab
 
Director
Investor Relations Information
ICR
Stephen Swett
www.icrinc.com
212-849-3882
 
 
Equity Research Coverage
 
 
Bank of America Merrill Lynch
 
James Feldman
 
(646) 855-5808
Capital One
 
Chris Lucas
 
(571) 633-8151
Citigroup Investment Research
 
Emmanuel Korchman
 
(212) 816-1382
Green Street Advisors
 
Eric Frankel
 
(949) 640-8780
J.P. Morgan
 
Michael W. Mueller, CFA
 
(212) 622-6689
Jefferies LLC
 
Jonathan Petersen
 
(212) 284-1705
Stifel Nicolaus & Co.
 
John W. Guinee
 
(443) 224-1307
Wells Fargo Securities
 
Blaine Heck
 
(443) 263-6529
Disclaimer: This list may not be complete and is subject to change as firms add or delete coverage of our company. Please note that any opinions, estimates, forecasts or predictions regarding our historical or predicted performance made by these analysts are theirs alone and do not represent opinions, estimates, forecasts or predictions of Rexford Industrial Realty, Inc. or its management. We are providing this listing as a service to our stockholders and do not by listing these firms imply our endorsement of, or concurrence with, such information, conclusions or recommendations. Interested persons may obtain copies of analysts’ reports on their own; we do not distribute these reports.

 
Fourth Quarter 2019
Supplemental Financial Reporting Package
Page 3

 402749146_logo3a14.jpg
 


Financial and Portfolio Highlights and Common Stock Data. (1)
 
 
(in thousands except share and per share data and portfolio statistics)

 
Three Months Ended
 
December 31, 2019
 
September 30, 2019
 
June 30, 2019
 
March 31, 2019
 
December 31, 2018
Financial Results:
 
 
 
 
 
 
 
 
 
Total rental income
$
74,015

 
$
67,020

 
$
63,613

 
$
59,604

 
$
56,125

Net income
$
24,382

 
$
12,948

 
$
15,954

 
$
10,717

 
$
15,207

Net Operating Income (NOI)
$
55,859

 
$
50,855

 
$
48,474

 
$
45,792

 
$
42,483

Company share of Core FFO
$
35,754

 
$
33,853

 
$
32,068

 
$
29,404

 
$
27,216

Company share of Core FFO per common share - diluted
$
0.32

 
$
0.31

 
$
0.30

 
$
0.30

 
$
0.29

Adjusted EBITDA
$
52,232

 
$
49,271

 
$
45,342

 
$
42,164

 
$
40,348

Dividend declared per common share
$
0.185

 
$
0.185

 
$
0.185

 
$
0.185

 
$
0.160

Portfolio Statistics:
 
 
 
 
 
 
 
 
 
Portfolio SF - consolidated
26,551,084

 
24,814,281

 
23,874,494

 
22,144,631

 
21,295,443

Ending occupancy - consolidated portfolio
96.1
%
 
94.9
%
 
94.2
%
 
94.6
%
 
95.4
%
Stabilized occupancy - consolidated portfolio
97.9
%
 
97.5
%
 
97.8
%
 
97.8
%
 
97.5
%
Leasing spreads - GAAP
42.0
%
 
31.2
%
 
39.4
%
 
26.2
%
 
25.1
%
Leasing spreads - cash
27.1
%
 
19.4
%
 
22.3
%
 
17.3
%
 
14.8
%
Same Property Performance:
 
 
 
 
 
 
 
 
 
Same Property Portfolio SF
18,134,752

 
18,134,752

 
18,134,752

 
18,134,752

 
18,134,752

Same Property Portfolio ending occupancy
97.4
%
 
97.0
%
 
96.8
%
 
96.8
%
 
96.0
%
Same Property Portfolio NOI growth(2)
5.5
%
 
5.2
%
 
6.8
%
 
7.6
%
 
n/a

Same Property Portfolio Cash NOI growth(2)
7.2
%
 
6.8
%
 
11.1
%
 
10.0
%
 
n/a

Stabilized Same Property Portfolio ending occupancy
97.6
%
 
97.7
%
 
97.9
%
 
97.9
%
 
97.4
%
Stabilized Same Property Portfolio NOI growth(2)
4.1
%
 
2.7
%
 
3.8
%
 
4.3
%
 
n/a

Stabilized Same Property Portfolio Cash NOI growth(2)
5.1
%
 
4.0
%
 
7.8
%
 
7.5
%
 
n/a

Capitalization:
 
 
 
 
 
 
 
 
 
Common stock price at quarter end
$
45.67

 
$
44.02

 
$
40.37

 
$
35.81

 
$
29.47

Common shares issued and outstanding
113,580,755

 
110,669,277

 
109,519,791

 
103,804,570

 
96,610,106

Total shares and units issued and outstanding at period end(3)
116,304,528

 
113,091,134

 
111,943,020

 
106,267,799

 
99,025,917

Weighted average shares outstanding - diluted
112,096,619

 
110,074,074

 
106,236,309

 
98,607,786

 
94,487,773

Series A, B and C Preferred Stock and Series 1 CPOP Units
$
278,281

 
$
278,281

 
$
192,031

 
$
165,000

 
$
165,000

Total equity market capitalization
$
5,589,909

 
$
5,256,553

 
$
4,711,171

 
$
3,970,450

 
$
3,083,294

Total consolidated debt
$
860,958

 
$
860,999

 
$
761,038

 
$
761,077

 
$
761,116

Total combined market capitalization (net debt plus equity)
$
6,372,010

 
$
5,920,044

 
$
5,300,000

 
$
4,454,952

 
$
3,663,809

Ratios:
 
 
 
 
 
 
 
 
 
Net debt to total combined market capitalization
12.3
%
 
11.2
%
 
11.1
%
 
10.9
%
 
15.8
%
Net debt to Adjusted EBITDA (quarterly results annualized)
3.7x

 
3.4x

 
3.2x

 
2.9x

 
3.6x

(1)
For definition/discussion of non-GAAP financial measures and reconciliations to their nearest GAAP equivalents, see the definitions section and reconciliation section beginning on page 26 and page 8 of this report, respectively.
(2)
Represents the year over year percentage change in NOI and Cash NOI for the Same Property Portfolio and Stabilized Same Property Portfolio. For comparability, NOI growth and Cash NOI growth for Q1’19, Q2’19 and Q3’19 has been restated to remove the results of Orangethorpe (sold Q2’19), Poinsettia Unit 301 (sold Q3’19), 13914-13932 East Valley Boulevard (sold Q4’19) and 2350-2380 Eastman Avenue (sold Q4’19). See page 23 for a list of dispositions completed during 2019.
(3)
Includes the following number of OP Units and vested LTIP units held by noncontrolling interests: 2,723,773 (Dec 31, 2019), 2,421,857 (Sep 30, 2019), 2,423,229 (Jun 30, 2019), 2,463,229 (Mar 31, 2019) and 2,415,811 (Dec 31, 2018). Excludes the following number of shares of unvested restricted stock: 212,545 (Dec 31, 2019), 214,995 (Sep 30, 2019), 219,789 (Jun 30, 2019), 223,476 (Mar 31, 2019) and 200,398 (Dec 31, 2018). Excludes unvested LTIP units and unvested performance units.

 
Fourth Quarter 2019
Supplemental Financial Reporting Package
Page 4

 402749146_logo3a14.jpg
 


Consolidated Balance Sheets.
 
 
 
 
(unaudited and in thousands)
 
December 31, 2019
 
September 30, 2019
 
June 30, 2019
 
March 31, 2019
 
December 31, 2018
ASSETS
 
 
 
 
 
 
 
 
 
Land
$
1,927,098

 
$
1,728,490

 
$
1,590,321

 
$
1,364,738

 
$
1,298,957

Buildings and improvements
1,680,178

 
1,611,060

 
1,528,750

 
1,422,684

 
1,332,438

Tenant improvements
72,179

 
68,124

 
66,665

 
62,908

 
60,024

Furniture, fixtures, and equipment
141

 
141

 
141

 
149

 
149

Construction in progress
18,794

 
29,094

 
23,576

 
20,331

 
24,515

  Total real estate held for investment
3,698,390

 
3,436,909

 
3,209,453

 
2,870,810

 
2,716,083

Accumulated depreciation
(296,777
)
 
(278,726
)
 
(261,231
)
 
(245,033
)
 
(228,742
)
Investments in real estate, net
3,401,613

 
3,158,183

 
2,948,222

 
2,625,777

 
2,487,341

Cash and cash equivalents
78,857

 
197,508

 
172,209

 
276,575

 
180,601

Restricted cash

 

 
11,055

 

 

Rents and other receivables, net
5,889

 
4,376

 
3,614

 
4,548

 
4,944

Deferred rent receivable, net
29,671

 
27,502

 
25,462

 
24,290

 
22,228

Deferred leasing costs, net
18,688

 
17,561

 
16,722

 
14,139

 
14,002

Deferred loan costs, net
695

 
849

 
1,004

 
1,158

 
1,312

Acquired lease intangible assets, net(1)
73,090

 
67,110

 
61,664

 
56,122

 
55,683

Acquired indefinite-lived intangible
5,156

 
5,156

 
5,156

 
5,156

 
5,156

Interest rate swap asset
766

 
374

 
1,414

 
5,896

 
8,770

Other assets(2)
9,671

 
10,778

 
14,204

 
12,580

 
6,723

Acquisition related deposits
14,526

 
8,415

 
4,615

 
10,875

 
925

Assets associated with real estate held for sale, net(3)

 
4,582

 

 

 

Total Assets
$
3,638,622


$
3,502,394

 
$
3,265,341

 
$
3,037,116

 
$
2,787,685

LIABILITIES & EQUITY
 
 
 
 
 
 
 
 
 
Liabilities
 
 
 
 
 
 

 
 
Notes payable
$
857,842

 
$
857,688

 
$
757,677

 
$
757,524

 
$
757,371

Interest rate swap liability
8,488

 
10,727

 
8,671

 
4,604

 
2,351

Accounts payable, accrued expenses and other liabilities(2)
31,112

 
34,669

 
26,065

 
33,728

 
21,074

Dividends payable
21,624

 
21,034

 
20,823

 
19,774

 
15,938

Acquired lease intangible liabilities, net(4)
59,340

 
56,151

 
55,084

 
52,426

 
52,727

Tenant security deposits
28,779

 
27,688

 
26,123

 
24,396

 
23,262

Prepaid rents
8,988

 
7,759

 
6,289

 
6,828

 
6,539

Liabilities associated with real estate held for sale(3)

 
135

 

 

 

Total Liabilities
1,016,173

 
1,015,851

 
900,732

 
899,280

 
879,262

Equity
 
 
 
 
 
 

 
 
Preferred stock
242,327

 
242,529

 
159,094

 
159,094

 
159,094

Common stock
1,136

 
1,106

 
1,095

 
1,038

 
966

Additional paid in capital
2,439,007

 
2,306,282

 
2,255,849

 
2,042,218

 
1,798,113

Cumulative distributions in excess of earnings
(118,751
)
 
(117,711
)
 
(107,056
)
 
(99,715
)
 
(88,341
)
Accumulated other comprehensive income
(7,542
)
 
(10,132
)
 
(7,101
)
 
1,261

 
6,262

Total stockholders’ equity
2,556,177

 
2,422,074

 
2,301,881

 
2,103,896

 
1,876,094

Noncontrolling interests
66,272

 
64,469

 
62,728

 
33,940

 
32,329

Total Equity
2,622,449

 
2,486,543

 
2,364,609

 
2,137,836

 
1,908,423

Total Liabilities and Equity
$
3,638,622

 
$
3,502,394

 
$
3,265,341

 
$
3,037,116

 
$
2,787,685

(1)
Includes net above-market tenant lease intangibles of $6,675 (December 31, 2019), $5,517 (September 30, 2019), $5,450 (June 30, 2019), $5,410 (March 31, 2019) and $4,647 (December 31, 2018).
(2)
In connection with the adoption of Financial Accounting Standards Board Topic 842 - Leases on January 1, 2019, we recognized operating lease right-of-use assets and lease liabilities related to our ground and office leases. As of December 31, 2019 we have operating lease right-of-use assets and lease liabilities of of $3.5 million and $3.8 million, respectively.
(3)
As of September 30, 2019, our property located at 13914-13932 East Valley Boulevard was classified as held for sale.
(4)
Includes net below-market tenant lease intangibles of $59,340 (December 31, 2019), $56,151 (September 30, 2019), $55,084 (June 30, 2019), $52,426 (March 31, 2019) and $52,610 (December 31, 2018).

 
Fourth Quarter 2019
Supplemental Financial Reporting Package
Page 5

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Consolidated Statements of Operations.
 
 
Quarterly Results
 
(unaudited and in thousands, except share and per share data)
 
Three Months Ended
 
Dec 31, 2019
 
Sep 30, 2019
 
Jun 30, 2019
 
Mar 31, 2019
 
Dec 31, 2018
Revenues
 
 
 
 
 
 
 
 
 
Rental income(1)
$
74,015

 
$
67,020

 
$
63,613


$
59,604

 
$
56,125

Management, leasing, and development services
105

 
90

 
109


102

 
114

Interest income
279

 
951

 
668


657

 
769

Total Revenues
74,399

 
68,061

 
64,390


60,363

 
57,008

Operating Expenses
 
 
 
 


 
 
 
Property expenses
18,156

 
16,165

 
15,139


13,812

 
13,642

General and administrative(2)
8,215

 
7,440

 
7,301


7,344

 
6,297

Depreciation and amortization
26,877

 
25,496

 
24,522


21,996

 
20,671

Total Operating Expenses
53,248

 
49,101

 
46,962


43,152

 
40,610

Other Expenses
 
 
 
 


 
 
 
Acquisition expenses
(3
)
 
122

 
29


23

 
166

Interest expense
7,364

 
6,785

 
6,255


6,471

 
6,656

Total Expenses
60,609

 
56,008

 
53,246


49,646

 
47,432

Gains on sale of real estate
10,592

 
895

 
4,810



 
5,631

Net Income
24,382

 
12,948

 
15,954


10,717

 
15,207

Less: net income attributable to noncontrolling interests
(734
)
 
(518
)
 
(569
)

(201
)
 
(277
)
Net income attributable to Rexford Industrial Realty, Inc.
23,648

 
12,430

 
15,385


10,516

 
14,930

Less: preferred stock dividends
(3,636
)
 
(2,572
)
 
(2,424
)

(2,423
)
 
(2,424
)
Less: earnings allocated to participating securities
(108
)
 
(112
)
 
(113
)

(114
)
 
(93
)
Net income attributable to common stockholders
$
19,904

 
$
9,746

 
$
12,848


$
7,979

 
$
12,413

 
 
 
 
 



 

Earnings per Common Share
 
 
 
 



 

Net income attributable to common stockholders per share - basic
$
0.18

 
$
0.09

 
$
0.12


$
0.08

 
$
0.13

Net income attributable to common stockholders per share - diluted
$
0.18

 
$
0.09

 
$
0.12


$
0.08

 
$
0.13

 
 
 
 
 


 
 
 
Weighted average shares outstanding - basic
111,612,279
 
109,645,216
 
105,847,557
 
98,342,677
 
93,995,846
Weighted average shares outstanding - diluted
112,096,619
 
110,074,074
 
106,236,309
 
98,607,786
 
94,487,773
(1)
See footnote (1) on the next page (page 7) for details related to our presentation of “Rental income” in the consolidated statements of operations for all periods presented.
(2)
In connection with the adoption of Financial Accounting Standards Board Topic 842, Leases (“ASC 842”), beginning in 2019 we are required to expense internal leasing costs that were previously allowed to be capitalized under prior lease accounting guidance (“ASC 840”). If we had adopted ASC 842 as of January 1, 2018, we would have expensed internal leasing costs (in thousands) of $288 for the three months ended December 31, 2018.


 
Fourth Quarter 2019
Supplemental Financial Reporting Package
Page 6

 402749146_logo3a14.jpg
 


Consolidated Statements of Operations.
 
 
Quarterly Results
 
(unaudited and in thousands)
 
Three Months Ended December 31,
 
Year Ended December 31,
 
2019
 
2018
 
2019
 
2018
Revenues
 
 
 
 
 
 
 
Rental income(1)
$
74,015

 
$
56,125

 
$
264,252

 
$
210,643

Management, leasing, and development services
105

 
114

 
406

 
473

Interest income
279

 
769

 
2,555

 
1,378

Total Revenues
74,399

 
57,008

 
267,213

 
212,494

Operating Expenses
 
 
 
 
 
 
 
Property expenses
18,156

 
13,642

 
63,272

 
51,671

General and administrative (2)
8,215

 
6,297

 
30,300

 
25,194

Depreciation and amortization
26,877

 
20,671

 
98,891

 
80,042

Total Operating Expenses
53,248

 
40,610