- EQT Real Estate acquired a 5.2M SF logistics portfolio with 32 buildings across five Southern California submarkets.
- More than half of the space sits in coastal infill markets near the Los Angeles and Long Beach ports, with the rest in Inland Empire West.
- The portfolio is 96% leased to 36 tenants and carries a 2.7-year weighted average lease term.
EQT Real Estate has acquired a 5.2M SF Southern California logistics portfolio from Rexford Industrial Realty. IREI reports that the 32-building portfolio acquisition spans five submarkets. It combines coastal infill properties with Inland Empire scale. EQT Real Estate Industrial Value Fund VI completed the purchase.
Get Smarter about what matters in CRE
Stay ahead of trends in commercial real estate with CRE Daily – the free newsletter delivering everything you need to start your day in just 5-minutes
Infill Access Anchors the Deal
More than half of the portfolio’s square footage is in Los Angeles, Orange County, the San Gabriel Valley, and South Bay. Those assets sit within roughly 25 miles of the Los Angeles and Long Beach port complex. The remaining 46% is concentrated in Inland Empire West. Those properties sit near Interstate 10, Interstate 15, SR-60, SR-91, and Ontario International Airport. The location mix gives the portfolio both infill access and regional distribution capacity.
The Details
The portfolio is 96% leased to 36 tenants. Occupiers span automotive, logistics, apparel, consumer electronics, food and beverage, consumer goods, chemicals, aerospace, and building products. The weighted average lease term is 2.7 years. EQT said the diversified roster provides an established income base from day one. It also creates opportunities to work with tenants as leases roll.
Port and Population Scale Support Demand
The Los Angeles and Inland Empire metros together have about 17.7M residents. An estimated 23M to 25M people live within 250 miles of each market. The San Pedro Bay port complex handles about 31% of US containerized international waterborne trade. That infrastructure supports demand for last-mile infill space and larger regional distribution facilities. It also connects the portfolio to one of the country’s largest freight networks.
Supply Constraints Support Infill Assets
Coastal infill markets remain the tightest part of the portfolio’s geography. Industrial occupancy there has ranged from 93% to 94%. Inventory grew only 0.6% to 1.1% during the past five years. Current availability stands between 7.9% and 8.8%. Inland Empire occupancy is about 91.5%. That market adds larger warehouses, ecommerce exposure, port access, and proximity to Ontario International Airport.
Why It Matters
The acquisition gives EQT exposure to both supply-constrained infill space and the Inland Empire’s regional warehouse network. Those Southern California industrial fundamentals are supported by the ports, population base, and established freight corridors. The 96% leased portfolio also spreads income across 36 tenants and several industries. That diversification reduces reliance on one occupier category while preserving exposure to the region’s distribution economy.
What’s Next
EQT plans to actively manage the portfolio as leases roll over. Managing Director Gardner Ellner said the firm sees opportunities to deepen tenant relationships. The 2.7-year weighted average lease term gives the owner a relatively near-term window to execute that strategy. EQT also expects the properties to capture demand across the strongest segments of Southern California logistics.
