Real Estate Sector

Rexford Industrial Realty has agreed to sell a Southern California industrial real estate portfolio to an affiliate of EQT Real Estate for approximately $1.2 billion. The transaction pushes Rexford's total closed and under-contract dispositions for the year to about $1.5 billion, meeting the lower bound of its recently raised disposition target of $1.5 billion to $2 billion. The divested properties were characterized by limited long-term growth potential, shorter lease terms, and above-market rents, and are projected to yield a 5.5 percent cash net operating income in 2027. CEO Laura Clark stated that the capital recycling aims to concentrate the REIT's footprint on assets with stronger cash flow growth opportunities. Rexford plans to deploy the proceeds to pay down debt maturing next year, fund development pipelines, and potentially buy back shares under its $1 billion repurchase program. The sell-off follows a second-quarter portfolio review that identified roughly 8 million square feet of non-core assets, contributing to a net loss of $506.9 million for the quarter due to noncash impairments. The deal is slated to close by the end of the third quarter.

bisnow.com reports that the owner of the 118-room Sixty Beverly Hills missed an August maturity date, sending its $40 million loan back to special servicing. According to Morningstar Credit, the current loan balance stands at $37 million. This marks the latest chapter for the property's debt, which has cycled into special servicing repeatedly since its original August 2022 maturity and received at least three extensions. Underlying cash flow has eroded significantly, dropping from $4.7 million at underwriting to just $2.2 million in March 2026. Property valuation has suffered a parallel decline, plunging from $85 million in 2018 to $59.5 million by 2024. The hotel joins a broader wave of California hospitality distress driven by maturing debt and climbing expenses, echoing recent troubled exits like the Westin Long Beach and the Edition West Hollywood.

Bisnow.com reports that an 80K SF office building at 3250 Mary St. in Coconut Grove sold for $62.3M, netting Azora Private Solutions and Vizcaya Capital a $15M gain in less than a year. The Miami-based sellers originally acquired the five-story property in October for $47.2M, pushing prices up 31% in a tightly contested market. State records show the buyer is Mary Street 3250 LLC, an entity managed by an executive at El-Ad National Properties. The transaction highlights surging valuations in Miami's luxury enclaves, where Class-A asking rents averaged $80.79 per SF in the second quarter against an 8.2% vacancy rate. El-Ad also controls an adjacent development site at 3265 Virginia St. acquired for $45M in May.