Prologis (PLD) recently announced that it has entered into a new build-to-suit agreement with Hitachi Transport System for a 233,400-square-foot distribution facility in the southern part of Japan. The new three-story facility, Prologis Park Tosu 2, will come up in an industrial park in Japan. The construction is expected to commence in November this year and the facility will likely be fully occupied upon its completion in July 2012.
This agreement is a testimony to the growing demand for new large-scale logistics facilities in Japan and Prologis is well placed to meet this demand with properties including Prologis Park Tosu 2. With this agreement, Prologis has 12 leases in 5 countries with Hitachi Transport System Group, which is one of the major 3PL (third party logistics) companies in Japan.
The new development is based in the city of Tosu, Japan and is situated at the junction of major transportation routes and is also in close proximity to the railway station and airports, thus making the region one of the largest industrial centers in Japan.
Prologis is a leading industrial real estate investment trust (REIT) that acquires, develops, operates and manages industrial real estate space in North America, Asia and Europe. The majority of the company’s portfolio comprises high throughput distribution (HTD), which provides multiple options for quick movement and the distribution of goods to the customer.Given its international presence, Prologis often faces unfavorable foreign currency movements and other economic fluctuations that impair its top-line growth.
The company at current levels has approximately 24 million square feet of space in Japan completed and under development, as well as 76 acres of land available for future development. Prologis currently retains a Zacks #3 Rank, which translates into a short-term Hold rating. We are also maintaining our long-term Neutral recommendation on the stock. One of its competitors PS Business Parks Inc (PSB) currently retains a Zacks #3 Rank.
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