ProLogis bullish on China industrial

THE world’s largest industrial property owner, ProLogis is expanding its presence in China through new developments in five key inland distribution markets.

ProLogis has secured land for five industrial parks in the cities of Changsha, Chengdu, Chongqing, Nanjing and Wuhan.

The five parks can accommodate over 8.7 million sq ft (808,000 sqm) of distribution space and represent an estimated $US246 million in total investment over time.

The first distribution centers at the new parks will be delivered over the course of 2007 and 2008.

In Changsha in China‘s Hunan Province, ProLogis has secured 41 acres (16.4 hectares) of land which will become the ProLogis Park Changsha. The precinct will accommodate five buildings totaling 900,000 sq ft (83,600 sqm) at full buildout.

In Chengdu in the Sichuan Province, ProLogis has secured 77 acres (31 hectares) and will be called ProLogis Park Chenghua, which can accommodate 1.5 million sq ft (139,350 sqm) of space.

In Chongqing, Prologis has acquired 59 acres (24 hectares) to developed into the ProLogis Park Chongqing, which can accommodate up to 1.2 million sq ft (108,000 sqm).

The company has also bought 66 acres (27 hectares) and reserved another 79 acres (32 hectares) of land adjacent to the Nanjing Lukou International Airport in Nanjing, the capital of Jiangsu Province.

The site, to be called ProLogis Park Jiangning, is located in a government- sponsored economic development zone and can accommodate 3 million square feet (278,700 sqm) of space.

Finally in Wuhan in the Hubei Province, ProLogis has acquired a 70% interest in a joint venture that owns three existing warehouse facilities and has reserved 119 acres of undeveloped land. The site, to be called ProLogis Park Wuhan Dongxihu, can accommodate up to 2.1 million sq ft of space.

ProLogis’ chief executive Jeff Schwartz said over the past three years the company has built an industry-leading position in China by focusing on coastal markets where demand is strongly tied to import-export activity.

“We now have park sites in coastal locations that can support approximately 50 million sq ft of total development. Importantly, we’re seeing strong demand for our acquired and newly developed warehouse buildings from both local enterprises and international companies with Chinese operations.

“The expansion we’re announcing today is a natural evolution of our overall strategy for China. While we continue to extend our presence in coastal markets, we also see opportunity in the country’s large inland cities, driven by exceptional GDP growth and increased domestic consumption. Our five new expansion cities have an aggregate population of more than 60 million people, and all are important regional distribution hubs for manufacturers, retailers and third-party logistics providers,” he added.

Scwartz said China‘s distribution infrastructure must continue to evolve in order to keep pace with the country’s overall economic expansion.

“We believe these new parks will play an important role in that regard by enhancing the efficiency of logistics for companies in all five of these key inland markets.” he added.

“All of these markets are experiencing substantial direct investment from corporations that are part of ProLogis’ existing and targeted base of global customers,” ProLogis’ China president Ming Mei said.

Australian Property Journal