LXP Industrial Trust Pre-leases 1.2M Sq Ft Phoenix Warehouse at $9.8M Rent
LXP Industrial Trust has pre-leased a 1.2 million sq ft speculative Phoenix development to a global logistics subsidiary under a five-year term starting December 1, 2026, with initial annual base rent of $9.8 million and 3.5% annual escalations. The $122 million project yields an estimated 8.0% development cash yield.
1. Pre-Lease Terms
LXP Industrial Trust has secured a 1.2 million square foot pre-lease in the West Valley submarket of Phoenix with a U.S. subsidiary of a global logistics company. The lease commences December 1, 2026, runs five years, and carries initial annual base rent of $9.8 million with 3.5% annual escalations.
2. Project Costs and Yield
The speculative development carries an estimated total cost of approximately $122 million. With the lease signing, the project delivers an estimated development cash yield of 8.0%, reflecting strong underwriting assumptions in a tight industrial market.
3. Strategic Impact and Volume
CEO T. Wilson Eglin noted that market fundamentals and steady absorption of million-square-foot supply over 18 months justified early construction, enabling this pre-lease. The transaction contributes to a record 4.4 million square feet of new and extended leases at this stage of the year for LXP.