By Barbra Murray, Contributing Editor<\/p>\n
Prologis Inc. capped off a busy quarter in Japan with the closing of five new lease agreements totaling nearly 560,000 square feet at three projects in its development portfolio.<\/p>\n
The five leases came on the heels of a handful of deals in the second quarter that account for an aggregate 1.5 million square feet. Among the largest transactions was the REIT’s contract to develop a 1.1 million-square-foot build-to-suit for a top Japanese apparel retailer near Tokyo.\u00a0 The distribution hub, Prologis Park Narashino 4, is on track to reach completion in August 2014.\u00a0 Prologis also entered into a build-to-suit agreement for a 473,000-square-foot e-commerce hub, Prologis Park Amagasaki 3, just outside of Osaka, for an online industrial tool retailer. Construction is expected to get underway in November.<\/p>\n
“This level of leasing activity reflects the expanding demand for modern, high-quality buildings in Japan,” said Mike Yamada, president of Prologis Japan. “Much of that demand is driven by the ongoing reconfiguration of supply chains, as well as functional obsolescence.”<\/p>\n
Undeniably, the call for state-of-the-art industrial facilities in Japan is growing louder, and the market is hard-pressed to provide the accommodations. “Following a dearth of speculative logistics development in recent years, occupancy rates in modern multi-tenant distribution facilities are at historical highs,” global real estate service provider Savills noted in a report. “Tenant demand for such premises has remained at healthy levels in recent quarters.”<\/p>\n
Prologis is one of the leading providers of premier industrial properties in Japan. As of the close of the first quarter, the company’s portfolio in the country totaled approximately 22 million square feet.<\/p>\n
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