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Plymouth (PLYM) Sees Solid Leasing Activity, High Occupancy

Plymouth Industrial REIT, Inc. PLYM has been witnessing active leasing, aiding solid occupancy, healthy rental collections and ample liquidity to back its acquisitions and growth efforts.

As of Dec 31, 2021, Plymouth’s total portfolio occupancy was 97.4% due to solid leasing activities. Also, PLYM has so far collected more than 99.7% of its contractual rents for the fourth quarter. This is consistent with its historical collection trends.

With regard to leasing activities, in its business update for the fourth quarter and full-year 2021, Plymouth noted that leases that started during the fourth quarter of 2021 totaled 666,598 square feet of space. Of this, 590,858 square feet is associated with leases having terms of at least six months. This comprised 202,894 square feet of renewal leases and 387,964 square feet of new leases. On a cash basis, 22.1% growth in rental rates will be experienced from these leases, reflecting healthy demand for Plymouth’s properties.

Leases commencing during 2021 aggregated 5,413,496 square feet, of which 5,044,901 square feet were related to leases with terms of at least six months. Moreover, Plymouth will garner an 11.2% increase in rental rates on a cash basis from these leases.

Plymouth is also focused on its growth measures. PLYM completed the acquisition of 12 industrial buildings aggregating roughly 2.9 million square feet of space for a total of $194.5 million during the fourth quarter. The company has also been strategically shedding assets. It sold a 74,613-square-foot industrial building in Chicago, IL for $5 million.

Plymouth continues to raise equity capital. During the fourth quarter, it raised roughly 1.82 million common shares through its at-the-market program, reaping approximately $51.8 million in net proceeds.

The industrial asset class has grabbed the limelight for showing resilience amid the pandemic, with low vacancy rates, high asking rents and robust rent collections. There has been an increase in e-commerce’s share of total retail sales, spurring demand for warehouse and distribution spaces. Apart from the fast adoption of e-commerce, industrial real estate space is anticipated to gain traction over the long run from a likely rise in inventory levels of companies as a precaution for supply-chain disruptions. This, in turn, will likely keep supporting industrial landlords to enjoy a favorable market environment.

Shares of this Zacks Rank #2 (Buy) company have rallied 30.3% in the past three months, outperforming the industry’s growth of 12.5%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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Other Key Picks

Some other key picks from the REIT sector include Terreno Realty Corporation TRNO, CubeSmart CUBE and Rexford Industrial Realty REXR.

Terreno Realty holds a Zacks Rank of 2 at present. Terreno Realty’s 2021 FFO per share is projected to increase 19.4% year over year.

Also, the Zacks Consensus Estimate for TRNO’s 2022 FFO per share has been revised marginally upward in the past two months.

The Zacks Consensus Estimate for CubeSmart’s 2021 FFO per share has moved 2.4% north to $2.10 over the past two months.

Currently, CubeSmart carries a Zacks Rank of 1. CUBE's long-term growth rate is projected at 11.2%.

The Zacks Consensus Estimate for Rexford Industrial’s 2021 FFO per share has moved 1.2% north to $1.63 over the past two months.

Currently, Rexford Industrial carries a Zacks Rank of 2. REXR's long-term growth rate is projected at 12.9%.

Note: Anything related to earnings presented in this write-up represents funds from operations (FFO) — a widely used metric to gauge the performance of REITs.

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