March 13, 2014 - EX-99.2 - 8-K: Current report filing | Rexford Industrial Realty, Inc. (REXR)

Exhibit 99.2

REXFORD INDUSTRIAL ANNOUNCES FOURTH QUARTER 2013 FINANCIAL RESULTS

 Reports FFO of $0.17 Per Diluted Share 

 Same Store Cash NOI Increases 15% 

 Completes Acquisitions of $186.4 Million Since the Start of 2013 

Los Angeles, California March 13, 2014  Rexford Industrial Realty, Inc. (the Company or Rexford Industrial) (NYSE: REXR), a real estate investment trust (REIT) that specializes in acquiring, owning and operating industrial properties located in Southern California infill markets, today announced financial results for the fourth quarter and full year 2013.

Fourth Quarter and Full Year 2013 Financial and Operational Highlights:

Reported Funds From Operations (FFO) of $0.17 per share for the 3 months ended December 31, 2013.

As previously reported, same property portfolio occupancy increased 3.0 percentage points to 89.3% compared to the fourth quarter of 2012.

Achieved same store NOI growth of 7% in the fourth quarter 2013 compared to the prior year period, driven by a 10% increase in same store revenue, more than offsetting a 17% increase in same store expenses. Same store cash NOI increased 15% compared to the fourth quarter 2012.

As previously reported, signed new and renewal leases totaling approximately 386,000 square feet, resulting in approximately 77,000 square feet of positive net absorption and increased GAAP leasing spreads of 12.9% and cash leasing spreads of 3.5% during the fourth quarter of 2013.

In the fourth quarter, acquired six properties totaling approximately 832,000 square feet for an aggregate cost of $69.7 million. Subsequent to year end, acquired four properties totaling approximately 352,000 square feet for an aggregate cost of $29.1 million.

Our fourth quarter 2013 financial results reflect the strong operating and leasing metrics which we pre-released in February. The execution of our operating and leasing strategies combined with the steady improvement in our core Southern California infill industrial markets drive these positive results, stated Michael Frankel and Howard Schwimmer, Rexford Industrials Co-Chief Executive Officers. In addition, with our initial public offering completed last July, we were well-positioned to accelerate our investment pace, acquiring six properties in the fourth quarter for $69.7 million. This activity has continued into early 2014, with another 4 acquisitions closed, for a total cost of $29.1 million. In the eight months since our initial public offering, we have acquired 1.3 million square feet of industrial property, representing a 24.6% increase in our owned portfolio and we continue to review and pursue a substantial pipeline of potential investment opportunities from a variety of sources.

Financial Results:

The Company reported a net loss of $0.88 million (or a net loss of $1.0 million before noncontrolling interests), or negative $0.04 per diluted share, for the three months ended December 31, 2013. In comparison, Rexford Industrials predecessor entities reported a net loss of $1.53 million (or a net loss of $1.68 million before noncontrolling interests) for the three months ended December 31, 2012

For the twelve months ending December 31, 2013, the Company reported a net loss of $4.9 million (or a net loss of $5.0 million before noncontrolling interests), compared to a net loss of $4.9 million (or a net loss of $9.0 million before noncontrolling interests) for the twelve months ended December 31, 2012. The net loss in 2013 included approximately $4.0 million of loss on extinguishment of debt associated with pay down of mortgage debt at the consummation of the IPO, $5.0 million of gains related to the disposition of five of the Companys properties, and $1.4 million of gains associated with early repayment of a note receivable. Financial results for periods ending on or prior to July 24, 2013 reflect the results of Rexford Industrials predecessor entities.

The Company reported funds from operations (FFO) of $4.3 million, or $0.17 per diluted share, for the three months ended December 31, 2013. The Companys share of Funds from Operations (FFO) for the period from July 24, 2013 through December 31, 2013 was $7.3 million, or $0.29 per diluted share.

Operating Results:

For the three months ended December 31, 2013, the Companys same property portfolio produced a 7.1% increase in NOI compared to the fourth quarter of 2012, driven by a 9.7% increase in same property portfolio revenue, more than offsetting a 16.7% increase in same property portfolio expenses. Cash NOI on the Companys same property portfolio was up 14.5% compared to the fourth quarter of 2012.

For the full year 2013, NOI on the Companys same property portfolio increased 12.6%, driven by a 10.6% increase in same property portfolio revenue offsetting a 5.8% increase in same property portfolio expenses, compared to 2012. Cash NOI on the Companys same property portfolio was up 15.8% in 2013, compared to 2012.

In the fourth quarter, the Company signed 91 new and renewal leases in its consolidated portfolio, totaling approximately 386,000 square feet. Average rental rates on comparable new and renewal leases were up 12.9% on a GAAP basis, and up 3.5% on a cash basis. The Company signed 38 new leases for approximately 142,000 square feet, with GAAP rents up 15.2%, compared to the prior in place leases. The Company signed 53 renewal leases for approximately 244,000 square feet, with GAAP rents up 12.4% compared to the prior in place leases. For the 38 new leases, cash rents were up 4.5%, and for the 53 renewal leases, cash rents were up 3.3%, compared to the ending cash rents for the prior leases.

The Company has included in a supplemental information package the results and operating statistics that reflect the activities of the Company for the three months ended December 31, 2013. See below for information regarding the supplemental information package.

Transaction Activity:

In November, the Company acquired Yorba Linda Business Park, a four-building Orange County, multi-tenant industrial park totaling 115,760 square feet, in Yorba Linda, California. The property was acquired for $12.7 million, or $109.71 per square foot, and was 79% occupied at the time of purchase.

In November, the Company acquired The Park, an Orange County industrial business park located in Anaheim, California, for $10.6 million, or $88.10 per square foot. The Park is located adjacent to the Interstate 5 Freeway in Anaheim, California, and consists of six multi-tenant buildings totaling 120,313 square feet. The buildings are situated on 6.9 acres of land, and were 85% occupied at the time of acquisition.

In December, the Company acquired Bonita Thompson, an industrial property in Pomona, California, for $27.2 million, or $74.34 per square foot. Located in the San Gabriel Valley sub-market, Bonita Thompson is in close proximity to three major highways, and consists of two 24 clear single-tenant, rail-served distribution buildings, with 52 dock-high loading positions, totaling 365,859 square feet. The divisible buildings are situated on 16.3 acres of land, and are currently 100% occupied.

In December, the Company acquired a 199,370 square foot industrial and office property located in Simi Valley, California, for $15.8 million, or $79 per square foot. The project consists of a 30 clear, ESFR single-tenant industrial building with 136,065 square feet and a two-story 63,305 square foot Class A office building, situated on 16.3 acres of land. The industrial building is 100% leased to Kingsbridge International, Inc. for ten years. The office building, which is situated on a separate parcel, is currently vacant and is currently in escrow for sale.

In December, the Company acquired Vanowen, a 31,037 square foot industrial building located in the San Fernando Valley, for $3.4 million, or $109.55 per square foot, adjacent to the Burbank (Bob Hope) Airport. The property is 100% leased to four tenants.

Subsequent to year-end and through February 24, the Company acquired four additional properties totaling approximately 352,000 square feet for an aggregate cost of $29.1 million, detailed below.

In January, the Company acquired Rosecrans, a 72,000 square foot industrial building located in Paramount, California, for $5.0 million, or $69.44 per square foot. The seller is consolidating into half of the building under a five year lease-back, enabling the Company to execute its value-add improvement and leasing plan for the remainder of the property.

In January, the Company acquired Oxnard Street, located in Van Nuys, California, for $8.9 million, or $114 per square foot. The property consists of a six-building multi-tenant business park totaling 78,000 square feet. The buildings are situated on 3.25 acres of land and are currently 98% occupied. The Company plans to upgrade the property through overall aesthetic improvements and operational enhancements to facilitate accelerated rent growth.

In February, the Company acquired Ontario Airport Business Park, an industrial property located in Ontario, California, for $8.6 million, or $75.69 per square foot. The project consists of a five-building multi-tenant business park totaling 113,612 square feet and is currently 95.4% occupied.

In February, the Company acquired an 88,330 square foot, six-building industrial complex located at 1500-1510 W. 228th Street, Los Angeles, California, for $6.6 million, or $74.72 per square foot. The complex is located within the South Bay submarket, and is currently 98.0% occupied.

Also, in January, the Company sold Kaiser, a 124,997 square foot industrial property in San Diego, California, for $10.1 million. Proceeds from the sale of Kaiser were reinvested into Ontario Airport Business Park and 1500-1510 W. 228^th Street acquisitions in a tax-deferred 1031 exchange.

Subsequent Events:

In March, the Company announced that Peter Schwab was elected as an independent director to the Companys Board of Directors.

On March 12, 2014, the Board of Directors declared a dividend of $0.12 per share for the first quarter 2014, payable in cash on April 15, 2014 to stockholders and unitholders of record on March 31, 2014.

Earnings Release, Investor Conference Webcast and Conference Call:

The company will release its fourth quarter and full year 2013 results after the market closes on Thursday, March 13, 2014. The Company will host a webcast and conference call that same day at 5:00 p.m. Eastern time to review fourth quarter results and discuss recent events. The live webcast will be available on the Companys investor relations website at www.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 27, 2014, by dialing 877-870-5176 (domestic) or 858-384-5517 (international) and entering the pass code 13576279.

About Rexford Industrial:

Rexford Industrial is a real estate investment trust that specializes in acquiring, owning and operating industrial properties in Southern California infill markets. The Company owns interests in 70 properties with approximately 7.7 million rentable square feet and manages an additional 20 properties with approximately 1.2 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 Companys 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 Companys future results to differ materially from any forward-looking statements, see the section entitled Cautionary Note Regarding Forward-Looking Statements in the Companys prospectus for its July 2013 IPO and other risks described in documents subsequently filed by the Company from time to time with the Securities and Exchange Commission (in particular under the caption Risk Factors in our periodic filings). 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.

Contact:

Investor Relations:

Stephen Swett or Rodny Nacier

424 256 2153 ext 401

investorrelations@rexfordindustrial.com

REXFORD INDUSTRIAL REALTY, INC. AND

REXFORD INDUSTRIAL REALTY, INC. PREDECESSOR

CONSOLIDATED AND COMBINED BALANCE SHEETS


	Rexford Industrial Realty, Inc.			Rexford Industrial Realty, Inc. Predecessor
	December 31, 2013 (Unaudited)			December 31, 2012
ASSETS
Land	$	219,301,000		$	151,057,000
Buildings and improvements		314,064,000			205,473,000
Tenant improvements		13,267,000			12,260,000
Furniture, fixtures, and equipment		188,000			188,000

Total real estate held for investment		546,820,000			368,978,000
Accumulated depreciation		(58,978,000	)		(55,370,000	)

Investments in real estate, net		487,842,000			313,608,000
Cash and cash equivalents		8,997,000			43,499,000
Restricted cash		325,000			1,882,000
Notes receivable		13,139,000			11,911,000
Rents and other receivables, net		929,000			559,000
Deferred rent receivable		3,642,000			3,727,000
Deferred leasing costs and in-place lease intangibles, net		14,189,000			5,003,000
Deferred loan costs, net		1,597,000			1,382,000
Acquired above-market leases, net		1,597,000			179,000
Acquired indefinite-lived intangible		5,271,000
Other assets		2,334,000			1,868,000
Acquisition related deposits		1,510,000			260,000
Investment in unconsolidated real estate entities		5,687,000			12,697,000
Assets associated with real estate held for sale		7,616,000			23,921,000

Total Assets	$	554,675,000		$	420,496,000

LIABILITIES & EQUITY
Liabilities
Notes payable	$	192,491,000		$	295,419,000
Accounts payable, accrued expenses and other liabilities		6,024,000			2,575,000
Due to members					1,221,000
Interest rate contracts					49,000
Dividends payable		5,368,000
Acquired lease intangible liabilities, net		1,160,000			39,000
Tenant security deposits		6,155,000			3,738,000
Prepaid rents		1,448,000			335,000
Liabilities associated with real estate held for sale		260,000			20,872,000

Total Liabilities		212,906,000			324,248,000
Equity
Rexford Industrial Realty, Inc. stockholders equity and Predecessor equity Common Stock, $0.01 par value 490,000,000 authorized and 25,559,886 outstanding at December 31, 2013		255,000
Additional paid in capital		311,936,000
Accumulated deficit		(5,993,000	)

Total stockholders equity		306,198,000

Predecessor equity					(12,691,000	)
Noncontrolling interests		35,571,000			108,939,000

Total Equity		341,769,000			96,248,000

Total Liabilities and Equity	$	554,675,000		$	420,496,000

REXFORD INDUSTRIAL REALTY, INC. AND

REXFORD INDUSTRIAL REALTY, INC. PREDECESSOR

CONSOLIDATED AND COMBINED STATEMENTS OF OPERATION (Unaudited)


	Rexford Industrial Realty, Inc.			Rexford Industrial Realty, Inc. Predecessor
	Period from July 24, 2013 to December 31, 2013			Period from January 1, 2013 to July 23, 2013			Year Ended December 31, 2012			Year Ended December 31, 2011
RENTAL REVENUES
Rental revenues	$	18,449,000		$	19,206,000		$	27,842,000		$	23,311,000
Tenant reimbursements		2,161,000			2,212,000			2,952,000			2,387,000
Management, leasing and development services		534,000			444,000			518,000			316,000
Other income		93,000			187,000			105,000			147,000

TOTAL RENTAL REVENUES		21,237,000			22,049,000			31,417,000			26,161,000
Interest income		381,000			698,000			1,577,000			1,577,000

TOTAL REVENUES		21,618,000			22,747,000			32,994,000			27,738,000

OPERATING EXPENSES
Property expenses		5,237,000			5,039,000			7,950,000			6,643,000
General and administrative		5,327,000			4,420,000			5,146,000			3,729,000
Depreciation and amortization		8,686,000			7,022,000			11,921,000			9,667,000
Other property expenses		1,167,000			885,000			1,300,000			1,015,000

TOTAL OPERATING EXPENSES		20,417,000			17,366,000			26,317,000			21,054,000
OTHER (INCOME) EXPENSE
Acquisition expenses		540,000			724,000			599,000			1,022,000
Interest expense		1,763,000			9,395,000			16,875,000			17,466,000
Gain on mark-to-market of interest rate swaps					(49,000	)		(2,361,000	)		(4,185,000	)

TOTAL OTHER EXPENSE		2,303,000			10,070,000			15,113,000			14,303,000
TOTAL EXPENSES		22,720,000			27,436,000			41,430,000			35,357,000

Equity in income (loss) from unconsolidated real estate entities		92,000			(915,000	)		122,000			185,000
Gain from early repayment of note receivable					1,365,000
Loss on extinguishment of debt					(3,955,000	)

NET LOSS FROM CONTINUING OPERATIONS		(1,010,000	)		(8,194,000	)		(8,314,000	)		(7,434,000	)

DISCONTINUED OPERATIONS
Income (loss) from discontinued operations before gain (loss) on sale of real estate and extinguishment of debt		299,000			(809,000	)		(698,000	)		(1,406,000	)
Loss on extinguishment of debt					(267,000	)
Gain on sale of real estate					4,989,000			55,000			2,503,000

INCOME (LOSS) FROM DISCONTINUED OPERATIONS		299,000			3,913,000			(643,000	)		1,097,000

NET LOSS		(711,000	)		(4,281,000	)		(8,957,000	)		(6,337,000	)

Net loss attributable to noncontrolling interests		86,000			15,000			4,066,000			2,585,000

NET LOSS ATTRIBUTABLE TO REXFORD INDUSTRIAL REALTY, INC.	$	(625,000	)	$	(4,266,000	)	$	(4,891,000	)	$	(3,752,000	)

Net loss available to common stockholders per share - basic and diluted	$	(0.03	)

REXFORD INDUSTRIAL REALTY, INC. AND

REXFORD INDUSTRIAL REALTY, INC. PREDECESSOR

Same Property Portfolio Statement of Operations and NOI Reconciliation (unaudited)

Same Property Portfolio Statement of Operations:


	Three Months Ending									Year Ending
	December 31									December 31
	2013⁽¹⁾			2012			Change			2013⁽¹⁾			2012			Change
Rental Revenues
Rental revenues	$	7,901		$	7,263			9	%	$	29,896		$	27,268			10	%
Tenant reimbursements		881			771			14	%		3,275			2,843			15	%
Other operating revenues		33			3			1000	%		231			79			192	%

Total rental revenues		8,815			8,037			10	%		33,402			30,190			11	%
Interest income		190			252			25	%		1,016			1,004			1	%

Total Revenues		9,005			8,289			9	%		34,418			31,194			10	%
Operating Expenses
Property expenses	$	2,532		$	2,170			17	%	$	9,283		$	8,777			6	%
Depreciation and amortization		3,695			2,967			25	%		11,313			12,129			(7	%)

Total Operating Expenses		6,227			5,137			21	%		20,596			20,906			(2	%)
Other (Income) Expense
Interest expense		60			4,299			(99	%)		9,075			17,339			(48	%)

Total Other Expense		60			4,299			(99	%)		9,075			17,339			(48	%)

Total Expenses		6,287			9,436			(33	%)		29,671			38,245			(22	%)
Loss on extinguishment of debt											(3,382	)

Net Income (Loss)	$	2,718		$	(1,147	)		337	%	$	1,365		$	(7,051	)		119	%

Same Property Portfolio NOI Reconciliation:

	Three Months Ending									Year Ending
	December 31									December 31
	2013⁽¹⁾			2012			Change			2013⁽¹⁾			2012			Change
NOI
Net Income (Loss)	$	2,718		$	(1,147	)				$	1,365		$	(7,051	)
Add:
Interest expense		60			4,299						9,075			17,339
Depreciation and amortization		3,695			2,967						11,313			12,129
Deduct:
Loss on extinguishment of debt											(3,382	)
Interest income		190			252						1,016			1,004

NOI	$	6,283		$	5,867			7	%	$	24,119		$	21,413			13	%

Straight-line rents		(209	)		(579	)					(158	)		(802	)
Amort. above/below market leases		24			36						77			142

Cash NOI	$	6,098		$	5,324			15	%	$	24,038		$	20,753			16	%

(1)	Includes Predecessor and Rexford Industrial Realty, Inc. results.

REXFORD INDUSTRIAL REALTY, INC. AND

REXFORD INDUSTRIAL REALTY, INC. PREDECESSOR

NOI Reconciliation, Portfolio Detail, and Occupancy (unaudited)

Same Property Portfolio NOI Reconciliation Continued:


	Three Months Ending									Year Ending
	December 31									December 31
	2013 ⁽¹⁾			2012			Change			2013 ⁽¹⁾			2012			Change
Rental revenues	$	7,901		$	7,263			9	%	$	29,896		$	27,268			10	%
Tenant reimbursements		881			771			14	%		3,275			2,843			15	%
Other operating revenues		33			3			1000	%		231			79			192	%

Total rental revenue		8,815			8,037			10	%		33,402			30,190			11	%
Property expenses		2,085			1,853			13	%		7,884			7,664			3	%
Other property expenses		447			317			41	%		1,399			1,113			26	%

Total property expense		2,532			2,170			17	%		9,283			8,777			6	%

NOI	$	6,283		$	5,867			7	%	$	24,119		$	21,413			13	%

Straight-line rents		(209	)		(579	)		(64	%)		(158	)		(802	)		(80	%)
Amort. above/below market leases		24			36			(34	%)		77			142			(46	%)

Cash NOI	$	6,098		$	5,324			15	%	$	24,038		$	20,573			16	%


	Quarterly Same Property Portfolio Detail												Annual Same Property Portfolio Detail
	# of Properties			Square Feet			Wtd Avg. Occupancy						# of Properties			Square Feet			Wtd Avg. Occupancy
							2013			2012									2013			2012
Period ended Sept. 30, 2013 and 2012		49			4,320,532			87.3	%		81.6	%		47			4,174,679			87.1	%		81.2	%
Additions (deductions)		(1	)		(124,944	)		100.0	%		5.1	%		(1	)		(124,944	)		100.0	%		5.1	%

Period ended Dec. 31, 2013 and 2012		48			4,195,588			89.3	%		86.3	%		46			4,049,735			89.1	%		86.1	%

Same Property Portfolio Occupancy:


	December 31, 2013	December 31, 2012	Change (ppt)
Occupancy:
Los Angeles County	89.3%	89.5%	-0.2%
Orange County	95.7%	87.6%	8.1%
San Bernardino County	88.4%	84.5%	3.9%
Ventura County	100.0%	100.0%	0.0%
San Diego County	81.6%	72.2%	9.4%
Other	80.6%	74.9%	5.7%

Total/Weighted Average	89.3%	86.3%	3.0%

(1)	Includes Predecessor and Rexford Industrial Realty, Inc. results

Form: 8-K

Documents