SoCal Sun Peeking Through, But REXR Still Has Some Clouds to Clear

REXR's 3Q26 Core FFO of $0.60 was in line with the Street and beat CitiE by +1c (+1.7%). In addition, REXR raised its 2026 FFO guidance by +2c (+0.8%) at the MP to $2.41-$2.44. REXR has been the strongest performing industrial REIT on a trailing 3-month basis, seemingly due to the expectation that SoCal has bottomed; while conditions are improving, we still expect weakness in spreads and impairments on incremental dispositions beyond the $71.8M recognized in 3Q. The improved new leasing pace (2.2msf vs. 840ksf in 2Q) and +200bps sequential increase in SS occupancy were positives and the execution on the $1.2B sale to EQT provided capital for $409M of buybacks and $485M of debt repayments and the incremental sales guidance should further help toward the goal of 3.5x Debt/EBITDA. REXR's 3.7msf of 3Q26 leasing activity was a significant acceleration from 2.1msf in 2Q26 driven by the 75% retention rate;