Rexford Industrial Realty (REXR) investor relations material

Strategic positioning and market overview

• Focus remains on infill Southern California, leveraging strong long-term supply-demand fundamentals and a vertically integrated team to drive value creation and NOI growth.

• Leasing momentum accelerated in July and August, with 1.9 million square feet leased, surpassing Q2 volumes and maintaining healthy spreads of 30% net effective and 15% cash.

• Portfolio management is dynamic, with asset-by-asset reviews leading to strategic leasing, repositioning, or disposition decisions to maximize value.

• Tenant demand is broad-based across sectors, with notable activity in aerospace, defense, consumer products, and electric vehicles, reflecting the region's economic diversity.

• Market occupancy remains high, and leasing activity is robust, with 85% of vacant spaces seeing activity and strong tenant retention.

Capital allocation and financial management

• Capital recycling is prioritized, with $166 million in asset sales at a 4.2% cap rate and $100 million redeployed into share repurchases at a 6.4% implied FFO yield.

• A new $500 million share repurchase program was authorized, reflecting confidence in share value and ongoing capital discipline.

• Repositioning and redevelopment projects have stabilized over 1 million square feet this year, generating 15% incremental returns and $195 million in incremental NOI.

• Operating leverage is enhanced by strategic cost reductions, including a reduction in force and G&A expense control, despite portfolio growth.

• Balance sheet strength is maintained with net debt to EBITDA at 4x and $1.6 billion in liquidity, supporting long-term priorities.

Portfolio and operational execution

• Strategic leasing decisions, such as leasing the 500,000+ square foot Mission property as-is, avoided redevelopment risk and secured a 43% cash leasing spread.

• Dispositions are selective, targeting operationally intensive or less efficient assets, with proceeds redeployed into higher-yielding opportunities.

• Acquisitions are currently deprioritized in favor of internal growth, with 28% embedded NOI growth driven by repositioning, redevelopment, and mark-to-market opportunities.

• The acquisitions team has been streamlined from 20 to 8, reflecting a shift to a more opportunistic and efficient approach, leveraging cross-functional teams.

• Internal processes and a vertically integrated model enable rapid, tailored tenant solutions, driving leasing outperformance.