staking a claim in China

Beijing may be China's political capital, but Shanghai seems to be getting most of the investment action—at least where logistics is concerned. In the past few weeks, furniture giant IKEA and restaurant operator YUM Brands both announced that they had opened DCs in the Shanghai region.

In addition, AMB Property Corp. has acquired a 184,000square-foot DC in Shanghai and says it will begin construction on another 185,000-square-foot building on an adjacent parcel this year. The San Francisco-based company says the acquisition is just the first step in a long-term plan to acquire and develop logistics/distribution centers in China.

It's not hard to understand why a developer like AMB would be eager to establish a toehold in China. The total value of China's domestic logistics market continues to soar. According to the Economic Daily newspaper, the market was worth about 5.8 trillion (in U.S. dollars) in 2005, a 24percent jump over the previous year.