What assumptions are being made about the valuation multiples and cap rates compared to recent comparable property sales in the sector?

The deal pricing is implicitly assuming that the three assets can be valued on the same price‑per‑square‑foot (or price‑per‑unit‑area) multiples and cap‑rate spectrum that have been observed in the most recent comparable sales of industrial/warehouse properties in the Los Angeles‑to‑Southern California corridor. In other words, the $177 million tag reflects a valuation that is roughly in line with the 6.5‑7.5 × EBITDA multiples and 5.0‑5.8 % cap rates that have been trading for similar‑size, fully‑occupied, class‑A logistics parcels over the past six months. By anchoring the transaction to those benchmarks, the seller is signaling confidence that the market still rewards stable, income‑generating assets with the same risk premium that supported the last handful of comparable transactions.

From a trading perspective, this assumption means that any deviation in the underlying cap‑rate environment—whether from rising interest rates, shifting supply‑demand dynamics in the industrial sector, or a change in tenant credit quality—will be quickly priced into the stock. If cap rates begin to compress (e.g., to sub‑5 % levels) while comparable sales remain at current multiples, the implied asset values would rise, creating upside pressure on PEAK’s share price. Conversely, if cap rates widen toward 6‑7 % or multiples fall below 6 × EBITDA, the market may re‑price the stock lower. Traders should watch the 10‑day moving average of cap‑rate spreads for LA‑area industrial sales and the relative performance of REITs with similar lease‑up profiles; a breakout above the 20‑day EMA on volume could signal that the sector is accepting higher multiples, supporting a bullish stance on PEAK, while a break below the 20‑day EMA would suggest the market is discounting future cash flows and a short position may be warranted.