There Is No Sleep to Brooklyn; Reiterate OW

Research evidence excerpt

There Is No Sleep to Brooklyn; Reiterate OW

May 20, 2026

as TRNO is more inclined than most to take on temporary dilution

of value-add investments in the name of longer-term upside. For

example, the total portfolio was 96.3% leased as of 3/31/26, which

was up 20bps sequentially, but also included a 205ksf vacancy in

Hialeah, Florida ("Building 30" near Miami), which is pre-leased and

expected to commence this quarter. That alone will add 100bps to the

leased percentage. Furthermore, TRNO completed the redevelopment

of Building 32 in Hialeah during 1Q26 as well ‒ 164ksf, 100% leased ‒

reflecting a commitment to the submarket even when it looks risky on

the surface. This type of cadence is par for the TRNO course, making

the elevated AFFO valuation a moot point, in our view.

●Recent Leasing Wins: Other recent leasing wins since 1Q26 include

~100ksf in Washington, DC (two leases, one of them with SCOTUS)

and a transshipment facility lease (10.2 acres) in Hayward, California

(East Bay). Point being, the same-store leased percentage is ~150bps

higher than the total portfolio, and that gap represents upside from

the opportunistic steps taken in the past. TRNO screens well from

a pure rent/sf perspective using the same CoStar comp set, with

rents generally at or above its markets and the national average. Said

differently, the leased percentage perspective is your friend, not your

enemy, if you are long TRNO stock.

●SoCal Perspectives: Much of what TRNO owns in Southern California

is west of the 405, where many submarkets are actually experiencing

peak rents, bucking the trend of broader question marks of the area.

Points east/Inland Empire will likely require more time to a tangible

recovery with tenant contractions still apparent when leases expire.