Monmouth Buys Georgia Property For $96.7M; Shares Gain 20% YTD

Monmouth Real Estate Investment Corp. (MNR) on Dec. 24 announced the acquisition of a new 657,518 square foot industrial building located in the city of Locust Grove in Georgia, for a purchase price of $96.7 million.

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Monmouth Real Estate Investment said that the purchased property is net-leased for 20 years to Home Depot (HD). The building is situated on 130 acres and has a land-to-building ratio of nearly nine times, with ample accretive growth potential, the company said.

“With the addition of this brand new facility near Atlanta, Monmouth’s weighted average building age is now 9.5 years. Through the acquisition of one high-quality asset at a time, we have more than doubled our portfolio size over the past five years,” said Monmouth Real Estate CEO Michael P. Landy. “This transaction marks our second high-quality acquisition during the first quarter. Fiscal 2021 is off to a very strong start for Monmouth, and we are confident we are taking the right steps to extend our company’s long track record of profitable growth and value creation.” .

On Dec. 22, B. Riley Securities analyst Craig Kucera raised the stock’s price target from $18 to $20 reiterated a Buy rating (15% upside potential).

The analyst’s update came shortly after Blackwells Capital’s all-cash offer of $18 per share to purchase the entire outstanding common stock of Monmouth.

Kucera views the offer price “as fair but certainly not a significant portfolio premium” for an industrial real estate investment trust of Monmouth’s “quality relative to its peers.”

Kucera believes the “Go-Shop” period may result in a higher offer for Monmouth. (See MNR stock analysis on TipRanks)

From the rest of the Street, the stock scores a cautiously optimistic analyst consensus of a Moderate Buy based on 3 Buys and 2 Holds. The average analyst price target of $17 implies downside potential of 2.3% to current levels. The share price has gained 20% on a year-to-date basis.