AMB Property Corporation(R) Releases Research Report on Global Trade and Industrial Real Estate Demand

SAN FRANCISCO, June 5 /PRNewswire-FirstCall/ -- AMB Property Corporation(R) (NYSE: AMB), a leading global owner, operator and developer of industrial real estate, today released a research report titled, "The Long-Term Prospects for Global Trade and Industrial Real Estate Demand: An analysis of a trade-based investment strategy in the midst of global economic crisis."

The report examines the impact of global trade on industrial real estate demand; the long-term relationship between trade and gross domestic product (GDP); insight into the evolution of trade; as well as the major trends that are expected to considerably influence the supply chain and warehousing needs of the future.

"Our analysis indicates that, while the global economy is in the midst of a recession, the fundamental drivers of industrial real estate demand remain intact. The recent declines in global trade volumes and the net absorption of industrial real estate--factors that are more aligned than ever--represent a temporary pause in a strong, longstanding secular trend. Today's interconnected, highly-efficient supply chains are not reversing in any meaningful way, and, on the margin, there are early signs that trade volumes may be stabilizing," said David C. Twist, AMB's vice president, Research.

Summary of Findings
-- Variations in trade account for 80 percent of the historical variation in industrial real estate demand.

-- Growth in trade volume is highly correlated with GDP (U.S. and global) and trade growth as a multiple of the GDP growth rate has more than doubled over the last 50 years. In the past decade, trade's multiplier on GDP expanded to 3.5, and as a result, nominal changes in GDP growth result in significant changes in trade growth. Global expectations for GDP in 2009 imply trade should fall by approximately 10 percent, a view consistent with that of industry experts.

-- There are four significant factors that have contributed to the recent declines in trade: inflation fluctuations; financing availability; supply chain responsiveness; and miscounting of final products.

-- Despite the current economic and financial downturn, structural support for the trade-to-GDP and trade-to-industrial-real-estate demand relationship remains intact. The global shift of labor, productivity and capital over many decades has created complex but efficient supply chains. A fundamental shift back to domestic production is not feasible as it would take decades and require much added cost to implement.

-- Consensus estimates for 2010 GDP growth in the U.S. and globally are currently at about 2.0 percent. This level of growth is consistent with about 500 million square feet of industrial real estate demand globally, and the beginning of a healthy recovery.

A copy of AMB's research report on the long-term prospects for global trade and industrial real estate demand, as well as other reports, can be downloaded from the company's website at www.amb.com/global_capabilities/research.html.