Lineage Logistics (LINE -0.2%) is the world's largest temperature-controlled warehouse operator. The real estate investment trust (REIT) owns more than 480 warehouses with about 3 billion cubic feet of storage in 19 countries. Cold storage warehouses are critical infrastructure to support the food supply chain.
The logistics giant is relatively new to the public markets, completing its initial public offering (IPO) in July 2024. The REIT raised $4.4 billion at an implied market value of $18 billion, making it the biggest IPO of the year and the largest real estate IPO of all time.
IPO
The industrial REIT has grown significantly over the years. It started with one warehouse in late 2008 and has made more than 100 acquisitions over the years to build the world's top player in cold storage. Despite already being the top dog in the industry, Lineage Logistics has lots of growth ahead.
That growth potential makes it an intriguing investment opportunity. Here's how to invest in Lineage Logistics and other key players in the logistics real estate sector.
Publicly traded?
Is Lineage Logistics publicly traded?
Yes, Lineage Logistics is a publicly traded company. The world's leading temperature-controlled warehouse REIT put its IPO on the calendar in 2024 and completed it in July 2024.
The company raised $4.4 billion, making it the biggest IPO of the year and the largest ever in the real estate sector. It sold 57 million shares at $78 apiece, which was near the top end of its range, valuing the company at more than $18 billion. It was the biggest IPO since Arm Holdings (ARM 4.49%) raised $4.8 billion in September 2023.
How to buy
How to buy Lineage Logistics stock
Now that Lineage Logistics is a publicly traded company, anyone can buy its stock. It trades on the Nasdaq Stock Exchange under the stock ticker LINE.
In addition to Lineage Logistics, there are many other ways to invest in logistics real estate. Here are three alternative investment options in the sector to consider along with Lineage Logistics:
1. Americold Realty Trust
Americold Realty Trust (COLD 0.0%) was the first publicly traded REIT in the temperature-controlled supply chain sector. It's the second-largest player (globally and in the U.S.) behind Lineage Logistics, with almost 240 facilities and 1.4 billion cubic feet of space. Like Lineage, Americold has been a consolidator in the sector, routinely gobbling up smaller players to enhance its size and scale.
2. W. P. Carey
W. P. Carey (WPC 0.15%) is a diversified REIT with investments in warehouse, industrial, retail, self-storage, and other property sectors. The company owns over 1,400 net lease properties and 78 operated self-storage properties. It also owned a pre-IPO stake in Lineage Logistics.
The REIT focuses on owning operationally critical real estate that generates stable rental income. Roughly 28% of its portfolio is logistics real estate, such as warehouses (non-cold storage), and another 35% is in other industrial real estate. W. P. Carey routinely acquires income-producing properties, with its focus in recent years on industrial and warehouse properties.
3. Prologis
Prologis (PLD 0.97%) is the leading logistics REIT. The company owns more than 5,600 warehouse buildings (non-cold storage) with about 1.2 billion square feet of space across North and South America, Europe, and Asia.
Prologis has built up a massive land bank to continue expanding its portfolio, including building new warehouses and selectively developing data centers. The company also routinely acquires properties and other REITs to grow its global logistics property empire.
Investors interested in buying Lineage Logistics stock or shares in a rival industrial REIT can do so through any brokerage account. Here are the six steps you need to take:
- Open your brokerage app: Log into your brokerage account where you handle your investments.
- Search for the stock: Enter the ticker or company name into the search bar to bring up the stock's trading page.
- Decide how many shares to buy: Consider your investment goals and how much of your portfolio you want to allocate to this stock.
- Select the order type: Choose between a market order to buy at the current price or a limit order to specify the maximum price you're willing to pay.
- Submit your order: Confirm the details and submit your buy order.
- Review your purchase: Check your portfolio to ensure your order was filled as expected and adjust your investment strategy accordingly.
Profitability
Is Lineage Logistics profitable?
It's important to analyze a company's profitability before buying shares. Profit growth tends to be the primary driver of a stock's performance over the long term. With that in mind, here's a look at Lineage Logistics' profitability.
The leading temperature-controlled warehouse REIT delivered its first quarterly earnings report as a public company in November 2024. The report showed that Lineage Logistics is profitable.
The company reported $1.3 billion of revenue for the period, up 0.5% year over year. While it posted a net loss of $543 million, or $2.44 per share, in the third quarter, the loss was due largely to costs associated with its IPO.
It should be noted that generally accepted accounting principles (GAAP) metrics like net income aren't the best way to measure a REIT's profitability. Rather, the best metric is adjusted funds from operations (FFO), a non-GAAP metric that measures the cash flows a REIT produces in a period. In Q3 2024, Lineage Logistics reported $208 million of adjusted FFO, or $0.90 per share, up 51.8% and 20%, respectively.
Funds from Operations (FFO)
Dividends
Does Lineage Logistics pay a dividend?
Lineage Logistics' strong profitability right out of the gates enabled the company to initiate a quarterly dividend. It made its first pro-rated dividend payment of $0.38 per share and plans to pay $2.11 per share annually. With its dividend payment comfortably below its adjusted FFO, Lineage Logistics retains plenty of cash to fund new investments.
The REIT should continue to grow. During the third quarter, it opened a new, fully automated cold storage warehouse in Hazleton, Pennsylvania. It also acquired ColdPoint Logistics for $223 million in November 2024, expanding its strategic presence in the Kansas City market.
Should I invest?
Should I invest in Lineage Logistics?
Investing is a personal endeavor. Not every stock is right for all investors. With that in mind, here are some reasons you might want to invest in Lineage Logistics.
- You believe investing in Lineage Logistics would help diversify your portfolio by adding real estate and a company with exposure to the food supply chain sector.
- You want to invest in companies that pay dividends.
- You think Lineage Logistics can grow its profits at an above-average rate in the future.
- You want to invest in a profitable company.
- You want to invest in companies with a strong balance sheet.
On the other hand, here are some reasons you might decide Lineage Logistics isn't right for you:
- You don't understand Lineage Logistics' business model or how it makes money.
- You already own several REITs, including those with exposure to the cold storage sector.
- You don't want to invest in dividend-paying stocks.
- You'd prefer to invest in companies with much higher growth potential.
ETF options
ETFs with exposure to Lineage Logistics
As a relative newcomer to the public markets, Lineage Logistics hadn't made it into exchange-traded funds (ETFs) as of late 2024, so you can't passively invest in its stock through an ETF just yet.
Exchange-Traded Fund (ETF)
However, there are lots of ways to passively invest in the REIT sector via ETFs. Here are three top REIT ETFs to consider:
- Vanguard Real Estate ETF (VNQ -1.29%): This fund invests in REITs and other real estate stocks. It had over 150 holdings in late 2024, including top REIT holding Prologis (6.4% of its net assets). The fund has a low ETF expense ratio of 0.13%.
- Schwab U.S. REIT ETF (SCHH -1.56%): This ETF exclusively invests in equity REITs (it excludes mortgage REITs and hybrid REITs). It had 117 holdings in late 2024, led by Prologis at 8.2% of its net assets. The ETF had a low 0.07% expense ratio.
- Real Estate Select SPDR Fund (XLRE -1.37%): This ETF focuses on holding real estate companies in the S&P 500. As of late 2024, the fund had 31 holdings, led by Prologis (9.6% of its net assets). The fund had a low 0.09% expense ratio.
Related investing topics
The bottom line on Lineage Logistics
Lineage Logistics completed the biggest IPO of 2024 and the largest public offering ever in the real estate sector. While it's already the global leader in operating temperature-controlled warehouses, the REIT plans to grow even bigger by continuing to consolidate the industry and invest in building new cold storage facilities. Those investments should help grow its profitability, increasing shareholder value over the long term.
FAQ
Investing in Lineage Logistics FAQ
Will Lineage Logistics go public?
Lineage Logistics went public in July 2024. The REIT raised $4.4 billion in the largest IPO of 2024 and the biggest-ever IPO in the real estate sector.
Is Lineage Logistics a good investment?
No single investment is good for everyone, but Lineage Logistics could be a good one. The company is a global leader in the temperature-controlled warehouse sector, which is crucial to the food supply industry. It's also profitable and has a strong balance sheet.
Those features position it well to grow its portfolio and profits in the future. The REIT anticipates that its current portfolio will grow its income as it raises rents and utilizes more of its existing capacity.
Meanwhile, Lineage Logistics expects to invest capital in development projects and accretive acquisitions to drive additional income growth. That growing income should enable the cold storage operator to increase its dividend. Growing profitability and dividend payments have historically helped support above-average investment returns over the long term.
Is Lineage Logistics publicly traded?
Yes, Lineage Logistics is a publicly traded company. The leading temperature-controlled warehouse operator went public in July 2024. It trades on the Nasdaq Stock Exchange under the stock ticker LINE.
How to buy shares of Lineage Logistics?
It's easy to buy shares of Lineage Logistics. The leading temperature-controlled warehouse REIT is a publicly traded company listed on the Nasdaq Stock Exchange under the stock ticker LINE. Here are the steps you need to follow to buy shares:
- Open your brokerage app.
- Search for the stock.
- Decide how many shares to buy.
- Select the order type.
- Submit your order.
- Review your purchase.
