) has penned another deal to expand its European platform. This
industrial real estate investment trust (REIT), which recently
penned a Build-to-Suit deal with Hi Logistics in U.K., has yet
again signed a similar agreement with L'Oreal, the French
This Build-to-Suit deal with L'Oreal is for a 270,000 square feet
space in France. Prologis inked the Build-to-Suit deal to develop
a facility in the Prologis Park Vemars that enjoys direct access
to the Roissy-Charles de Gaulle Airport. It would be the sixth
facility at the park and will house L'Oreal's French consumer
The other recent deal for Prologis is a Build-to-Suit agreement
with Hi Logistics, a specialist logistics subsidiary of LG
Electronics. In addition, the company would develop two
speculative facilities. In total, the three buildings will span
over 700,000 square feet.
Particularly, the Build-to-Suit deal with Hi Logistics will span
165,000-square-foot and will be positioned at the key
distribution hub, Prologis Park Ryton in the West Midlands. It
will be the regional distribution center for the customers of Hi
With around 30 million square feet of logistics and distribution
space as of Jun 30, 2013, Prologis is the leading provider of
industrial real estate in France. Moreover, its 17 million square
feet of logistics and distribution space in U.K., which is more
than 97% leased as of that date, signifies the company's solid
foothold in the European industrial real estate market.
Also, these deals depict Prologis' efforts to expand its European
platform by leveraging on its relationship with existing
customers. L'Oreal is its existing customer with facilities in
Poland and the Czech Republic while Hi Logistics already occupies
Prologis' facilities in The Netherlands and Poland.
The demand for well-positioned, Class-A logistics facilities
remains high amid a larger customer base and supply chain
consolidation. However, the pace of new units' construction is
low. It is this demand-supply disequilibrium that is set to
define the market dynamics in the near term in Europe.
With a capacity to offer modern distribution facilities in
strategic infill locations, Prologis is set to gain from this. In
fact, it has the capability to meet explicit logistics
requirement and, hence, the company is expected to crack such
Prologis currently carries a Zacks Rank #3 (Hold). Other better
performing REITs include
Highwoods Properties Inc.
SL Green Realty Corp.
), all carrying a Zacks Rank #2 (Buy).
CUBESMART (CUBE): Free Stock Analysis Report
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PROLOGIS INC (PLD): Free Stock Analysis
SL GREEN REALTY (SLG): Free Stock Analysis
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