Industrial real estate investment trust (:REIT) – Prologis Inc. (PLD) – disclosed that Jaguar Land Rover has chosen Prologis Park Ryton in the U.K. for setting up its special vehicles operations technical center. Regarding this, a lease deal for 225,000 square feet of space has already been inked.
Completed in May 2014, this new facility is well positioned in the motorway network hub, enjoying easy access to the M6, M69 and M40/M5. Moreover, the park’s proximity to Jaguar Land Rover’s headquarters makes it ideal as the company’s global hub for manufacturing high-performance, luxury tailored vehicles.
Improving fundamentals in the global industrial REIT market is grabbing investors’ attention. The current Jaguar Land Rover deal reflects the solid demand for Prologis properties in the U.K. The company already owns and manages around 20 million square feet of logistics and distribution space in the U.K as of Jun 30, 2014.
In fact, with a solid balance sheet and decent cash flow generating capabilities, Prologis is well-suited to leverage on the worldwide demand for specialized logistics and distribution space. Earlier this month, the company inked a pre-lease deal with a logistics and supply chain solutions company for a space of 197,000 square feet at Prologis CCP Cajamar II, Building 300 in Sao Paulo, Brazil. (Read: Prologis Inks Prelease Deal for Brazilian Development).
Last month, driven by higher rental income and strategic capital earnings, Prologis reported better-than-expected second-quarter results. Core FFO (funds from operations) per share came in at 48 cents, 2 cents above the Zacks Consensus Estimate and 7 cents ahead of the year-ago quarter figure.
Prologis currently carries a Zacks Rank #3 (Hold). Investors interested in the REIT industry may consider better-ranked stocks like DCT Industrial Trust Inc. (DCT), Extra Space Storage Inc. (EXR) and Gladstone Commercial Corp. (GOOD). All these stocks have a Zacks Rank #2 (Buy).
Note: FFO, a widely used metric to gauge the performance of REITs, is obtained after adding depreciation and amortization and other non-cash expenses to net income.
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