Tuesday, September 1, 2009

Japanese Logistics Facilities Suppliers Ally

ProLogis and JLF agree joint venture
Shipping News Feature

JAPAN / USA - ProLogis, a leading global provider of distribution facilities, announced yesterday that it has entered into an alliance with Japan Logistics Fund (JLF) related to the acquisition of properties from ProLogis' Japan development portfolio.

In November 2008, ProLogis outlined a series of immediate actions to strengthen its balance sheet and reduce risk given global financial market conditions. To reduce risk in the company's development portfolio in Japan, the company plans to own and manage some of its distribution facilities with joint venture partners and will retain other assets on its balance sheet.

ProLogis' strategy to align with joint venture partners fits well with JLF's objective of expanding its portfolio through external growth opportunities that provide long-term ownership of state-of-the-art distribution facilities. It is anticipated that some of the distribution facilities ProLogis currently owns in Japan will be jointly owned by both parties. Moreover, through this joint ownership structure, ProLogis would continue managing and leasing the properties, earning management fees related to those services.

The distribution facilities to be jointly owned by JLF and ProLogis will be determined after both parties conclude a formal agreement, under which ProLogis may also provide JLF with continued investment opportunities.

In addition to this tie-up ProLogis is currently in discussions regarding a possible joint development partnership agreement with the Mitsui & Co. Group, which holds a controlling interest in the asset management company of JLF.

The news follows on from the company’s announcement last week that it is to develop a brand new 503,000 sq foot facility for one of its existing customers in the UK at Newhouse in Scotland.

(pic: ProLogis Park Marston Gate development in the West Midlands)