With increasing demand for modern distribution facilities,
), a leading industrial real estate investment trust (REIT), has
recently signed a build-to-suit agreement to construct a new
e-commerce distribution hub spanning 473,000 square feet in Osaka,
Japan. The deal was penned with MonotaRO Co., Ltd. - one of the
premier online industrial tool retailers in Japan.
Prologis will start construction on the proposed hub in November
2012 and expect to wind it up by September 2013. The distribution
hub will come up in Prologis Park Amagasaki 3, which is
strategically located in close proximity to the central business
district of Osaka with easy access to major expressways and a
commuter rail station.
Prologis acquires, develops, operates and manages industrial
real estate space in North America, Asia and Europe. As of March
31, 2012, Prologis had approximately 22 million square feet of
logistics and distribution space in Japan. Given its international
presence, Prologis has lately faced unfavorable foreign currency
movements and other economic fluctuations that have impaired its
Furthermore, although first quarter 2012 results were in sync
with the Zacks Consensus Estimates, macroeconomic issues had
contributed to a slower pace of recovery as the industry was
affected by the continued concerns about sovereign debt issues,
rising energy costs, global military actions and the devastation
and loss caused by the earthquake and tsunami in Japan.
In addition, the unrelenting troubles in the residential sector
are weighing on commercial property operations. The credit crunch
has also widened the bid-ask spread between buyers and sellers of
commercial real estate, which has caused deal volumes to fall
compared to pre-recession levels. Moreover, market vacancy
increases is expected to mitigate Prologis' ability to push through
rental rate increases, thereby affecting the long-term growth of
We currently have a Neutral recommendation and a Zacks #3 Rank
for Prologis, which translates into a short-term Hold rating. We
also have a Neutral recommendation and a Zacks #2 Rank (short-term
Buy rating) for
Winthrop Realty Trust
), one of the peers of Prologis.
WINTHROP REALTY (FUR): Free Stock Analysis
PROLOGIS INC (PLD): Free Stock Analysis Report
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