OSAKA, JAPAN-Sankyu Inc., a logistics services company, hasleased about 103,000 square feet at the AMB Nanko Naka DistributionCenter here. The property, in the heart of the Port of Osaka, isowned by San Francisco-based AMB Property Corp.

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Guy Jaquier, AMB's president of Asia, said that thetenant was looking for a large, new building to make distributionnetworks more efficient. “In Japan, we have seen improvement in ouroperating portfolio in the second quarter due to the increasedexport of higher value goods to China. We continue to see customersinterested in occupying class A distribution facilities that canhelp them drive down overall supply chain costs and increaseoperational efficiencies,” Jaquier tells GlobeSt.com.

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Of the company’s total portfolio of 16.2 million square feet ofoperating and development properties , more than 10.6 millionssquare feet is in Japan. The focus is on Tokyo, Osaka and Nagoya,Jaquier says. “We are optimistic about growing our business inAsia, and AMB continues to tap into the rising demand in the Asianmarkets, where economic growth is expected to outpace the rest ofthe world,” he says.

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Jaquier says Japan is on the front end of a structural shift inits distribution and logistics industry that will require asignificant change in the size and configuration of distributionfacilities. “Industry observers estimate that as much as 25% ofTokyo's industrial space is obsolete or dysfunctional for moderndistribution needs,” he says. “The concentration of facilitylocations, product obsolescence, channel complexity and landconstraints of Tokyo’s industrial market create significantopportunity for experienced developers to bring modern warehousingfacilities and practices to targeted submarkets.”

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