1 real estate action to play the e-commerce boom
IIndustrial real estate is one of the hottest commercial real estate sub-sectors today, fueled by overwhelming demand from e-commerce and logistics companies. In this crazy live Video clip, recorded on January 24Fool.com contributors Marc Rapport and Matt Frankel explain why Terreno Realty (NYSE: TRNO) could be a big winner from this trend.
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Mark Report: Terreno is an interesting company. There are some pretty small industrial REITs out there. They own like last mile properties, many small warehouses, vacant lots and infill properties in six major markets, all coastal markets on both sides of the country. They bought properties like crazy for $7 million, $14 million apiece. They have a lot of customers using them for last mile delivery. I think it’s still a really solid company. Their stock really took off. Do the latter part of there really for most of 2021 and the year so far. Wile in 2021, it is up 46% since the start of the year. It is now down 15%. The only reason I put it last is that its fees are quite high for a REIT and they are $73. I still think the stock could go down. Could still go down. If you want that, maybe we could settle down.
Matt Frankel: I displayed a map of Terreno on the screen.
Report: You can see here that where they were last April, look at the October surge at the start of the year, it was really quite dramatic. I should have sold upstairs.
Frankel: Industrial real estate is one of the hottest real estate sectors currently on the market. He’s basically exhausted. It’s a term you don’t usually use with an entire commercial real estate industry. The pandemic has just caused the demand for storage space to explode. Companies like Amazon, all of these e-commerce venues need a lot of processing space. With labor shortages and supply chain disruptions like material shortages, they simply weren’t able to build them fast enough. That’s why you saw this giant rise towards the end of the year, when the supply chain disruptions really started to kick in.
Report: It did, and this one ran more than many. The reason why I just ranked it pretty low right now. Because I really think he could still recoup a lot of his stock price. I intend to stick to it. I think they have a very good business model.
John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a board member of The Motley Fool. Matthew Frankel, CFP® has no position in the stocks mentioned. The Motley Fool owns and recommends Amazon and Terreno Realty. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.