AMB’s largest industrial lease agreement in a decade in Kent Valley
AMB Property Corporation (AMB), a leading global owner, operator and developer of industrial real estate, has recently signed a leasing agreement for over 516,000 square feet in Kent Valley, Seattle. The deal was signed with Kimberly-Clark Corp (KMB), a leading global health and hygiene company, for an undisclosed amount. The agreement was the largest industrial leasing deal signed in a decade in the region.
Kimberly-Clark would relocate its existing Northwest regional distribution operations to the new leased site at the East Value Warehouse of AMB. The leased facility is strategically located in the center of Kent Valley between the Ports of Seattle and Tacoma. Consequently, Kimberly-Clark would gain instant access to transportation across the entire Seattle metropolitan area.
Based in San Francisco, AMB is a real estate investment trust (REIT) that acquires, develops, operates and manages industrial real estate in North America, Asia and Europe. The majority of its portfolio comprises high throughput distribution (HTD), which provides multiple options for quick movement and the distribution of goods to the customer.
HTD properties are either warehouses or industrial properties that are located near airports, seaports and ground transportation facilities, enabling rapid distribution of customers’ products. These HTD centers are typically located in areas, which are supply-constrained, in-fill markets, and are global ports. The location advantage also brings a significant pricing advantage.
Industry-focused REITs have been one of the worst-performing sectors in 2009. With a sagging global GDP, demand for industrial space continues to dry up. However, AMB is better equipped than its peers to weather the current downturn due to its strong portfolio.
The company has a concentration of assets in high-barrier gateway markets that hold up better in a recession. The company is also de-leveraging its balance sheet by repaying debt using proceeds from asset sales and issuance of shares. We reiterate our Hold rating of AMB.
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Read the full analyst report on “KMB”
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