AI Could Make Rexford Industrial One Of The Biggest Winners In Real Estate

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AI Could Make Rexford Industrial One Of The Biggest Winners In Real Estate

While AI has dominated headlines for its impact on data centers, chipmakers, and software platforms, there is a less obvious but potentially massive beneficiary: industrial real estate. Specifically, infill logistics facilities in dense, high-barrier markets like Southern California, where Rexford Industrial (REXR) operates exclusively.

Rexford is rarely included in the "AI winners" conversation, but that may soon change. A confluence of powerful tailwinds driven by artificial intelligence—from e-commerce growth to business formation to power demand—is aligning in REXR’s favor. And yet, despite this, REXR trades at one of the lowest FFO multiples in its sector due to short-term oversupply and trade concerns. In our view, this disconnect presents a long-term opportunity.

Here’s why AI could unlock years of outperformance for REXR.

1. AI-Accelerated E-Commerce Demand Shift

AI is poised to accelerate the shift from offline to online retail by helping businesses deliver better value, faster shipping, more personalized offers, and highly targeted marketing—at lower cost. As a result, e-commerce will become more competitive with brick-and-mortar retail, attracting more consumers and increasing order volumes.

Expectations around convenience and speed will rise. Businesses—large and small—will need:

• Fulfillment centers near major population hubs

• Advanced logistics systems

• Highly automated warehouse infrastructure

REXR’s portfolio of infill industrial assets—located in the most logistically strategic areas of Southern California—is exactly the type of real estate this evolving commerce ecosystem requires. As online shopping grows more dominant, demand for REXR's strategically located properties will follow.

2. Onshoring and Smart Manufacturing