By Wang Xu (China Daily)
Updated: 2007-09-06 09:35

ProLogis, the world's largest developer and owner of warehouses and distribution centers, said yesterday it will spend US$30 million on a logistics park in Northeast China's Shenyang, its latest move to expand into China's inland cities.

ProLogis and its local partner Dalian Port Group will invest a total of US$50 million to develop the 313,587-sqm logistics park. Located in Shenyang's Economic and Technology Development Zone, the park will open in 2008 when the first phase is finished and will be completely built by 2010.

"We are extremely bullish about our business here," said Jeffery Schwartz, chairman and chief executive officer of ProLogis. "China is now our fastest-growing region globally on a percentage basis."

The company had invested US$500 million in China by the end of June and plans to invest up to US$500 million annually in the nation in the coming years. Since 2003, ProLogis has expanded into 19 cities around the nation, with more than 40 logistics parks under management.

The company is looking at opportunities in major inland cities that could complement its existing foothold in cities such as Shanghai, Beijing and Guangzhou.

The US-based company also said yesterday it would invest another US$40 million with Dalian Port Group to develop a 550,000-sqm logistics park in Dalian, raising total investment in the project to US$160 million. The two companies set up the facility in 2006 and now provide services to companies such as Orient Overseas Container Line and Japan's Itochu Corp.

China's logistics market, which includes freight, warehousing and distribution facilities, is expected to grow by almost 30 percent annually in the next three to four years, according to Jones Lang LaSalle, a real estate consultancy.

"Being the world's manufacturing base, China's logistics costs are still very high compared with developed countries, which means great growth potential for us," said Ming Mei, president of ProLogis' China operation.

That potential has brought a slew of overseas developers to the country. In July, Goodman Group, the world's second-largest industrial property developer, said it would invest US$2 to US$3 billion in China in the next three to five years, a tenfold increase on its current investment.

Australia's largest listed real estate firm entered China two years ago and has developed and owns US$200 million worth of industrial properties in the country, mainly in Shanghai.