Rexford is selling 22 Southern California industrial buildings to EQT for $1.2bn, and says the portfolio yields 5.5 percent in 2027 because the rents on it are above market

$1.2bn, in cash, for 22 buildings.

Rexford Industrial Realty told the SEC on Tuesday morning that its operating partnership signed an agreement of purchase and sale on August 13 with an affiliate of EQT Real Estate, covering a portfolio of 22 industrial properties. The price is payable in cash at closing, which the company expects by September 30. There is no due diligence condition. Closing turns on customary conditions, among them receipt of required tenant estoppels.

The yield is the disclosure

Rexford puts the estimated 2027 cash net operating income yield on the portfolio at 5.5 percent, and says in the same sentence why. The figure reflects the anticipated roll-down of above-market in-place rents and expected moveouts.

That is the company describing what it is selling, in its own words, and the release goes further. It defines a non-core asset as one with limited long-term value creation potential, elevated competitive supply, shorter remaining lease durations and above-market in-place rents.

Where the money goes

The sale is part of a previously announced $2.0bn disposition programme. Including this deal, Rexford has closed or gone under contract on roughly $1.5bn of dispositions this year, which puts it inside full-year guidance of $1.5bn to $2.0bn.

Proceeds are earmarked for three things: repaying debt that matures in 2027, opportunistic buybacks under an existing $1.0bn repurchase authorisation, and further spending on repositioning and development projects. The company reaffirmed the 2026 guidance it gave with second quarter results on July 23.

Rexford held 409 properties and about 49.9 million rentable square feet at June 30, all of it in infill Southern California. Laura Clark is chief executive. The purchase agreement itself is not public yet and will be filed with the third quarter Form 10-Q.