(TOKYO) US-based industrial property developer Pro- Logis will invest 450 billion yen (S$6 billion) in Japan to bring its total Japanese investment to 900 billion yen by end-2009, its Japan chief said on yesterday.
The company, which started to invest in Japan in 2001, has already invested 450 billion yen of assets including those currently under development, but demand for large and efficient distribution centres remains strong, said Miki Yamada, president and co-chief executive of ProLogis in Japan.
‘We have set a goal of 900 billion yen and we are progressing as planned,’ Mr Yamada said.
ProLogis Japan has tied up with Government of Singapore Investment Corp and jointly launched two funds worth about 320 billion yen.
Mr Yamada said corporations are under pressure to lower their inventory levels but the need to move goods swiftly and effectively to meet market demand remains strong. ‘Overall, inventories are falling and the absolute number of warehouses may be falling, but there is demand to renovate old warehouses and needs for new, large and effective distribution centres will increase,’ he added.
ProLogis operates 69 warehouses with total floor space of 3.4 million sq m. With a gradual economic recovery and pick-up in land prices in 2006 for the first time in 16 years, the Japanese property market has turned competitive, making it harder to procure land or properties.
Mr Yamada said prices have soared and competition heated up, but the company is ready to expand and boost its investments.
‘We started with nothing in Japan. Now we have about 100 staff. We have ability and speed to process things,’ Mr Yamada said.
He said the company is considering listing a real estate investment trust but no solid plan has been set, adding that it will explore various options including tying up with other investors or listing itself as a public company.
Source: Reuters (Business Times 30 Aug 07)