US Operator and International Investment Perspective on REITs October 14, 2005

Transcription

1 US Operator and International Investment Perspective on REITs October 14, 2005

2 The American REIT Experience > Growth and Evolution of the U.S. REIT Industry > Lessons Learned from the U.S. REIT Experience > Key Strategic Issues for REITs in U.S. and Elsewhere 2005 AMB Property Corporation 2

3 Growth and Evolution of the U.S. REIT Industry > U.S. REIT Industry began in 1960 through an act of Congress > Made investment in income-producing real estate accessible to all > Portfolios of professionally managed properties > Offering diversification and liquidity > Shares traded on the major exchanges 2005 AMB Property Corporation 3

4 A Vehicle with Tax Transparency > REITs avoid corporate entity level tax > Must distribute earnings as dividends to their shareholders > Single tax imposed on the income at shareholder level > Tax transparency allowed REITs to compete with other vehicles 2005 AMB Property Corporation 4

5 The early days 70s and 80s > Industry struggles in the 70s > Worst overbuilt conditions in U.S. history caused by: Real Estate Partnership Tax Shelters Deregulation of the Savings Loans > Tax Reform Act of AMB Property Corporation 5

6 The Renaissance of REITs in the early 90s > Investor frustration with private investment vehicles > Public Securitization of real estate addressed investor needs > Plenty of attractive investment opportunities after the crash > KIMCO IPO in 1991 First IPO of a company with quality assets and led by knowledgeable and investor-friendly management 2005 AMB Property Corporation 6

7 The Modern Era Mid 90s Until Present > Advent of the UPREIT structure > Explosive growth of the REIT sector > REIT Modernization Act of 1999 > NAREIT Composite Index companies with $331 Billion of equity market capitalization 2005 AMB Property Corporation 7

8 Lessons Learned from the U.S. Experience > Flexible REIT structure to adapt to evolving business needs > Appropriately tax-sensitive structure > Alignment of Interests between management and shareholders 2005 AMB Property Corporation 8

9 Strategic Issues for REITs - U.S. and Elsewhere > Business Model > Growth Strategies > Customer Focus > Capitalization Strategies 2005 AMB Property Corporation 9

10 Evolution of REIT Business Models > Geographic or Product Focus > Transition from National to Global > Uniformity of Customers > Consistency of Product Offerings 2005 AMB Property Corporation 10

11 Alternative Growth Strategies > Operations > Acquisitions > M&A Activity > Development 2005 AMB Property Corporation 11

12 Customer Focus > Apartments - Servicing the local customer > Offices Providing efficient and attractive space to corporate customer > Shopping Centers Helping retailers replicate a branded experience > Industrial Sector Providing global customers with modern distribution facilities that are consistent from market to market > Key Opportunity Repeat business, Internationally 2005 AMB Property Corporation 12

13 Capitalization Strategies > More choices and greater financial flexibility at a lower cost > Debt and Equity capital flows are becoming global > Importance of private capital 2005 AMB Property Corporation 13

14 Predictions > Continued globalization of the REIT model > Rapid securitization of European property companies > REIT structure will become dominant global form of ownership > Continued growth of private capital > More harmonization and reciprocity between taxing regimes > Greater uniformity and consistency in reporting standards 2005 AMB Property Corporation 14

15 This document contains forward-looking statements such as the size, completion and total investment in development projects which are made pursuant to the safeharbor provisions of Section 21E of the Securities Exchange Act of Forward-looking statements involve numerous risks and uncertainties and should not be relied upon as predictions of future events. The events or circumstances reflected in our forward-looking statements might not occur. We assume no obligation to update or supplement forward-looking statements. For further information on factors that could impact AMB and the statements contained herein, reference should be made to AMB s filings with the Securities and Exchange Commission, including AMB s annual report on Form 10-K for the year ended December 31, 2005.