As Japan starts to sort through the wreckage left behind in the wake of last week’s earthquake and tsunami – and continues to shudder in the aftershocks – U.S. companies have begun to release information on their own status in the beleaguered country. Major companies, including four real estate investment trusts (REITs) – Starwood Hotels & Resorts Worldwide Inc., ProLogis, Simon Property Group Inc., and AMB Property Corp – have buildings in the areas where there was extensive destruction.
AMB reported that several facilities had been severely damaged while it cannot reach its Sendai facility. Repairs are already underway at some locations and the company is offering space in undamaged facilities to displaced customers. Simon properties, which owns eight outlet centers in a joint venture with Mitusbishi Estate Co Ltd, has one center in Sendai and no news on its status at press time. Starwood properties in Sendai sustained no structural damage but will remain closed due to lack of utilities. Shares for Starwood closed up 0.8 percent.
Overall, REIT stocks experienced declines yesterday due to concern over reports that REIT holdings were substantially damaged in the earthquake and tsunami. Local REITs experienced declines even though they did not have holdings overseas, and some shed as much as 1.3 percent of their market value by midday on Monday, though only “a handful” remained down more than 1 percent.
Our thoughts and prayers are with the citizens of Japan in this crisis.
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