Benjamin Butcher, president and CEO of STAG Industrial, Inc. (NYSE: STAG), joined REIT.com for a CEO Spotlight video interview during REITWeek 2015: NAREIT’s Investor Forum, held in New York.
STAG is a Boston-based REIT focused on the acquisition and operation of single-tenant, industrial properties throughout the United States.
Butcher told REIT.com that the dynamics for favorable leasing conditions have improved during the last year.
“Vacancy is down broadly across the U.S. industrial market, and certainly down in most of the markets we operate in. We’ve been pleasantly surprised by the continual improvement,” he said.
Turning to balance sheet issues, Butcher noted that STAG has consistently taken a conservative approach toward debt. As a result, Fitch Ratings recently raised the company’s corporate credit rating to BBB from BBB-, he said.
STAG, like others in the REIT industry, has seen its share price dip, Butcher said, which has impacted the equity cost of capital. However, Butcher said STAG is “comforted by fact that acquisitions remain very accretive at the margin,” which is enabling the company to continue to raise capital.
Meanwhile, Butcher pointed out that STAG is well on its way to reaching its $450 million acquisition goal for 2015.
“We’re pretty confident we’ll be able to achieve that number. We’ve certainly built a machine capable of even larger numbers and we expect to be able to deliver (those numbers) over the coming years,” Butcher said.