AMB Property (AMB)

Q1 2011 Earnings Call

April 20, 2011 1:00 pm ET


Guy Jaquier - President of Private Capital, Europe & Asia Region

Eugene Reilly - President of North America Region

Tracy Ward - Vice President of Investor Relations & Corporate Communications

Thomas Olinger - Chief Financial Officer and Chairman of Investment Committee

Hamid Moghadam - Co-Founder, Chairman, Chief Executive Officer, President and Member of Executive Committee


James Feldman - BofA Merrill Lynch

John Guinee - Stifel, Nicolaus & Co., Inc.

Sloan Bohlen - Goldman Sachs Group Inc.

Ki Kim - Macquarie Research

David Rodgers - RBC Capital Markets, LLC

Ralph Davies - JP Morgan Chase & Co

Evan Smith - FBR Capital Markets & Co.

Steven Frankel - Green Street Advisors, Inc.

Ross Nussbaum - UBS Investment Bank

Michael Bilerman - Citigroup Inc

Matthew Dembski - MKM Partners LLC

Paul Morgan - Friedman, Billings, Ramsey & Co.

David Harris - Gleacher & Company, Inc.



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Good afternoon. My name is Nickisia, and I will be your conference operator. At this time, I would like to welcome everyone to the AMB Property Corporation's First Quarter earnings conference call. [Operator Instructions] Thank you. I would now like to turn the call over to Ms. Tracy Ward. Ma'am, you may begin your conference

Tracy Ward

Thank you. Good morning, everyone. And thank you for joining us this morning. Before we begin formal remarks, I'd like to remind you that this call is the property of AMB Property Corporation and is being recorded. Earlier this year, we announced a merger of equals between ProLogis and AMB. Materials regarding the transaction are posted on both companies' websites. In addition, the joint proxy statement has been filed and contains information about the transaction. This call will focus on our first quarter, 2011 financial results.

Please be aware that statements made during this call that are not historical may be deemed forward-looking statements. Actual results may differ materially from those indicated by forward-looking statements due to a variety of risks and uncertainty. Please refer to our filings with the Securities and Exchange Commission, including our 2010 10-K for a detailed discussion of these risks. Acknowledging the fact that this call may be webcast for a period of time, we believe it's important to note that today's call includes time-sensitive information that may be accurate only as of today's date, April 20, 2011.

The company's supplemental information package was filed earlier today with the SEC on Form 8-K. The filing is posted on the AMB website in the Investor Relations section under Financial Information Supplemental Report. Also included in our supplemental information package are the reconciliations from GAAP financial measures to non-GAAP financial measures.

This morning, I will turn the call over to Hamid Moghadam, Chairman and CEO, who will comment on the macroeconomic environment and customer sentiment; and Tom Olinger, our Chief Financial Officer, will review our financial operating results and provide an update on 2011 guidance before we open the call to your questions, Gene Reilly, President Americas, and Guy Jaquier, President Europe and Asia and Private Capital, are also in the call today. Hamid, will you please begin?

Hamid Moghadam

Thanks, Tracy. Good morning, and welcome to our first quarter call. As you'll see, our financial and operating results were in line with our expectations and point to the good progress we're making on our business priorities. Before we get started, I'd like to spend a few moments on the events that took place in Japan last month. We feel very fortunate and thankful that none of our employees or customers were injured during the earthquake and tsunami. Our teams on the ground went above and beyond helping our customers restore their businesses and they continue to do so. We are pleased to report that today, all AMB buildings in Japan are online and that none of our buildings experienced any downtime with the exception of our one facility in Sendai, which was down for just under four weeks.

Now as we review the progress we've made on our key priorities, I'd like to put them in the context of the long-term strategy we articulated at our investor forum in September . You may recall our position then was that the market conditions and operating fundamentals would continue to improve and that our global platforms were ready to create value. We have the resources, both talent and capital, in place, and we have several irons in the fire regarding new co-investment ventures around the globe. In effect, we are prepared to go on offense. Well, conditions have improved and we are definitely on offense.

Following a banner year in 2010, we raised more than $1.1 billion in Private Capital in the first quarter of 2011 making it a record quarter for us. In fact, it was an AMB record for any 12-month period. Private Capital continues to be an important driver of our business. And with a third-party equity raised this quarter, we have $3.2 billion of deployment capacity in our funds, which will allow us to invest in opportunities around the world.

Co-investment ventures provide us with the ability to recapitalize our existing platform and to increase our balance sheet capacity. And we forged strong strategic relationships in the process. With new Private Capital vehicles established in Mexico, Brazil, Europe and China, we'll now return our fundraising focus to Japan where we see significantly improved development opportunities going forward.

Looking at capital deployment in the first quarter, we put more than $320 million to work. We broke ground on developments in Beijing, Hamburg, São Paulo and Osaka markets in which customer demand exceeds existing supply.

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