AMB Property Corporation(R) , a leading global developer and owner of industrial real estate, today reported results for the quarter and nine-month period ended September 30, 2007.

Funds from operations per fully diluted share and unit ("FFOPS") was $0.99 for the third quarter of 2007, as compared to $0.72 for the same quarter in 2006. FFOPS for the year-to-date period was $2.31, as compared to $2.10 for the same period in 2006. The FFOPS results exceeded the high end of the company's previous guidance for the third quarter by $0.21 per share, primarily as a result of better-than-expected profitability on development projects contributed to the company's private capital funds and strong core operating performance.

Net income available to common stockholders per fully diluted share and unit ("EPS") was $0.69 for the third quarter of 2007, as compared to $0.33 for the same quarter in 2006. EPS for the year-to-date period was $2.04 as compared to $1.39 for the same period in 2006.

Operating Results

AMB's industrial operating portfolio occupancy was 95.5% at September 30, 2007, as compared to 96.1% at June 30, 2007 and 95.9% at September 30, 2006. Average occupancy during the quarter was up 50 basis points to 95.4%, from 94.9% for the same period in 2006. Benefiting from rising rents in many of the company's markets and the increase in average portfolio occupancy, cash-basis same store net operating income increased 5.3% in the third quarter and 5.8% in the first three quarters, over the same periods in 2006. In the third quarter of 2007, rents on lease renewals and rollovers in AMB's operating portfolio increased 8.9%, as compared to increases of 2.0% in the prior quarter and 9.9% in the third quarter of 2006.

"The strength of global trade is driving steady demand and solid valuations for distribution real estate in strategic supply chain markets around the world," said Hamid R. Moghadam, AMB's chairman and CEO. "AMB's quarterly financial results reflect this strength with both better-than-projected development profits and portfolio operating performance. We continue to see compelling opportunities to expand our global development platform by serving the needs of key customers to reconfigure or consolidate their distribution networks."

Investment Activity

New development starts in the quarter totaled approximately 2.8 million square feet in 11 projects in North America and Europe, with an estimated total investment of $233 million. At quarter end, AMB's industrial development pipeline totaled approximately 16.8 million square feet in 47 projects, globally, and four value-added conversion projects in North America, with an estimated total investment of $1.6 billion scheduled for delivery through 2009. Also during the quarter, the company made AMB Moffett Business Center Industrial, a value-added conversion project, available for sale.

The company's development business includes contributions of stabilized properties to affiliated private capital funds or sale of projects to third parties. During the third quarter, AMB contributed four development projects totaling 1.3 million square feet. Additionally, AMB sold three projects: a 42,600 square foot development; a land parcel; and a value-added conversion project -- AMB Osgood Industrial. Aggregate gross proceeds from these seven projects totaled $245 million.

"AMB's long-term focus on investing in high-demand infill locations in major markets is providing a unique opportunity to create incremental value for our shareholders through the repurposing of selected properties to higher and better uses," Mr. Moghadam added. AMB announced at its September 18, 2007 Investor Forum in New York City that it projects $30-50 million of potential gains, annually, from its value-added conversion business over the next several years.

Expanding the company's presence in several target markets in North America, Europe and Asia, AMB acquired 1.5 million square feet of industrial distribution space in nine properties at a total acquisition cost of $116 million, $98 million of which was acquired for three of the company's private capital funds: AMB Institutional Alliance Fund III, AMB Japan Fund I and AMB Europe Fund I.

Subsequent to the quarter, AMB announced the expansion of its global platform into the United Kingdom with the acquisition of a 320,000 square foot development property strategically located in a supply-constrained London submarket.

Share Repurchase

During the third quarter, the company repurchased 1,069,038 shares of its common stock for an aggregate price of $53.3 million, or at a weighted average price of $49.87 per share. Approximately $147 million of capacity remains under the company's current stock repurchase program.

Addition of Company Officers

During the quarter, five officers joined the company: Anthony Bourke joined the Private Capital group as senior vice president, business development; Hardy Milsch joined the Southwest Region as vice president, leasing & development, Mexico; David Nix joined the East Region as vice president, acquisitions; Tim Nolan joined the Global Customer Development team as a vice president; and Mary Paeng joined the Private Capital group as vice president, business development.

Commenting on these recent hires, Mr. Moghadam said, "With a focus on attracting and retaining the top talent in the industry, we welcome these new officers to our global team, each of whom brings to AMB a high level of ability and a rich background of experience applicable to their new role. We're pleased to have them onboard."

Supplemental Earnings Measures

Included in the footnotes to the company's attached financial statements is a discussion of why management believes FFOPS is a useful supplemental measure of operating performance, ways in which investors might use FFOPS when assessing the company's financial performance and FFOPS's limitations as a measurement tool. Reconciliation from net income to funds from operations and FFOPS is provided in the attached tables and published in AMB's quarterly supplemental analyst package, available on the company's website at http://www.amb.com/.

The company believes that net income, as defined by GAAP, is the most appropriate earnings measure. However, the company considers cash-basis same store net operating income (SSNOI) to be a useful supplemental measure of its operating performance. Properties that are considered part of the same store pool include all properties that were owned as of the end of both the current and prior year reporting periods and exclude development properties for both the current and prior reporting periods. The same store pool is set annually and excludes properties purchased and developments stabilized after December 31, 2005. In deriving SSNOI, the company defines NOI as rental revenues (as calculated in accordance with GAAP), including reimbursements, less straight-line rents, amortization of lease intangibles, and property operating expenses, which excludes depreciation, amortization, general and administrative expenses and interest expense. The company considers SSNOI to be an appropriate and useful supplemental performance measure because it reflects the operating performance of the real estate portfolio excluding effects of non-cash adjustments and provides a better measure of actual cash basis rental growth for a year-over-year comparison. In addition, the company believes that SSNOI helps the investing public compare the company's operating performance with that of other companies. While SSNOI is a relevant and widely used measure of operating performance of real estate investment trusts, it does not represent cash flow from operations or net income as defined by GAAP and should not be considered as an alternative to those measures in evaluating AMB's liquidity or operating performance. SSNOI also does not reflect general and administrative expenses, interest expense, depreciation and amortization costs, capital expenditures and leasing costs, or trends in development and construction activities that could materially impact its results from operations. Further, the company's computation of SSNOI may not be comparable to that of other real estate companies, as they may use different methodologies for calculating SSNOI. Reconciliation from net income to SSNOI is published in the company's quarterly supplemental analyst package, available on the company's website at http://www.amb.com/.

"Owned and managed" is defined by the company as assets in which the company has at least a 10% ownership interest, is the property or asset manager, and which it intends to hold for the long-term.

Conference Call and Supplemental Information

The company will host a conference call to discuss its third quarter 2007 results on Wednesday, October 17, 2007 at 1:00 PM EDT. Stockholders and interested parties may listen to a live broadcast of the conference call by dialing 877 447 8218 (from the U.S. and Canada) or +1 706 643 7823 (from all other countries) and using reservation code 18459848. A webcast can be accessed through a link titled "Q3 2007 Earnings Conference Call" located on the home page of the company's website at http://www.amb.com/.

If you are unable to listen to the live conference call, a telephone and webcast replay will be available after 3:00 PM EDT on Wednesday, October 17, 2007 until 8:00 PM EST on Friday, November 16, 2007. The telephone replay can be accessed by dialing 800 642 1687 (from the U.S. and Canada) or +1 706 645 9291 (from all other countries) and using reservation code 18459848. The webcast replay can be accessed through the link on the company's website at http://www.amb.com/.

AMB Property Corporation.(R) Local partner to global trade.(TM)

AMB Property Corporation(R) is a leading global developer and owner of industrial real estate, focused on major hub and gateway distribution markets throughout North America, Europe and Asia. As of September 30, 2007, AMB owned, or had investments in, on a consolidated basis or through unconsolidated joint ventures, properties and development projects expected to total approximately 140.8 million square feet (13.1 million square meters) in 44 markets within 13 countries. AMB invests in properties located predominantly in the infill submarkets of its targeted markets. The company's portfolio is comprised of High Throughput Distribution(R) facilities-industrial properties built for speed and located near airports, seaports and ground transportation systems.

AMB's press releases are available on the company website at http://www.amb.com/ or by contacting the Investor Relations department at +1 415 394 9000.

Some of the information included in this press release contains forward-looking statements, such as those related to demand for our product, occupancy levels, rental rate growth, increasing valuations, our development, value-added conversion, redevelopment and renovation projects (including completion, timing of stabilization, our ability to lease such projects, square feet at stabilization or completion, costs and total investment amounts, and projected gains), our ability to grow our private capital business (including contributions to such funds), returns on invested capital and source of investment opportunities, and our ability to accomplish future business plans (such as expansion into additional markets and of our platform generally) and to meet our forecasts and business goals, which are made pursuant to the safe-harbor provisions of Section 21E of the Securities Exchange Act of 1934, as amended, and Section 27A of the Securities Act of 1933, as amended. Because these forward-looking statements involve risks and uncertainties, there are important factors that could cause our actual results to differ materially from those in the forward-looking statements, and you should not rely on the forward-looking statements as predictions of future events. The events or circumstances reflected in forward-looking statements might not occur. You can identify forward-looking statements by the use of forward-looking terminology such as "believes," "expects," "may," "will," "should," "seeks," "approximately," "intends," "plans," "pro forma," "estimates" or "anticipates" or the negative of these words and phrases or similar words or phrases. You can also identify forward-looking statements by discussions of strategy, plans or intentions. Forward-looking statements are necessarily dependent on assumptions, data or methods that may be incorrect or imprecise and we may not be able to realize them. We caution you not to place undue reliance on forward-looking statements, which reflect our analysis only and speak only as of the date of this press release or the dates indicated in the statements. We assume no obligation to update or supplement forward-looking statements. The following factors, among others, could cause actual results and future events to differ materially from those set forth or contemplated in the forward-looking statements: defaults on or non-renewal of leases by tenants, increased interest rates and operating costs, our failure to obtain necessary outside financing, re-financing risks, risks related to our obligations in the event of certain defaults under joint venture and other debt, risks related to debt and equity security financings (including dilution risk), difficulties in identifying properties to acquire and in effecting acquisitions, our failure to successfully integrate acquired properties and operations, our failure to divest properties we have contracted to sell or to timely reinvest proceeds from any divestitures, risks and uncertainties affecting property development and construction (including construction delays, cost overruns, our inability to obtain necessary permits and public opposition to these activities), our failure to qualify and maintain our status as a real estate investment trust, risks related to our tax structuring, failure to maintain our current credit agency ratings, environmental uncertainties, risks related to natural disasters, financial market fluctuations, changes in general economic conditions or in the real estate sector, changes in real estate and zoning laws, a downturn in the U.S., California or global economy, risks related to doing business internationally and global expansion, losses in excess of our insurance coverage, unknown liabilities acquired in connection with acquired properties or otherwise and increases in real property tax rates. Our success also depends upon economic trends generally, including interest rates, income tax laws, governmental regulation, legislation, population changes and certain other matters discussed under the heading "Risk Factors" and elsewhere in our annual report on Form 10-K for the year ended December 31, 2006 and our quarterly report on Form 10-Q for the quarter ended June 30, 2007.

                       CONSOLIDATED BALANCE SHEETS
                          (dollars in thousands)

                                                       As of
                                      September 30, 2007  December 31, 2006
  Assets
  Investments in real estate:
    Total investments in properties           $6,548,426        $6,575,733
    Accumulated depreciation                    (884,336)         (789,693)
      Net investments in properties            5,664,090         5,786,040
    Investments in unconsolidated joint
     ventures                                    360,272           274,381
    Properties held for contribution,
     net                                         258,568           154,036
    Properties held for divestiture,
     net                                          63,733            20,916
      Net investments in real estate           6,346,663         6,235,373
  Cash and cash equivalents and
   restricted cash                               400,011           195,878
  Accounts receivable, net                       159,269           133,998
  Other assets                                   157,235           148,263
       Total assets                           $7,063,178        $6,713,512

  Liabilities and stockholders' equity
  Secured debt                                $1,364,557        $1,395,354
  Unsecured senior debt                        1,002,810         1,101,874
  Unsecured credit facilities                    818,325           852,033
  Other debt                                     145,104            88,154
  Accounts payable and other liabilities         333,034           271,880
      Total liabilities                        3,663,830         3,709,295
  Minority interests:
    Joint venture partners                       516,948           555,201
    Preferred unitholders                         77,561           180,298
    Limited partnership unitholders              103,773           102,061
      Total minority interests                   698,282           837,560
  Stockholders' equity:
    Common equity                              2,477,654         1,943,240
    Preferred equity                             223,412           223,417
      Total stockholders' equity               2,701,066         2,166,657
      Total liabilities and
       stockholders' equity                   $7,063,178        $6,713,512



                 CONSOLIDATED STATEMENTS OF OPERATIONS(1)
                (dollars in thousands, except share data)

                            For the Quarters Ended      For the Nine Months
                                   September 30,         Ended September 30,
                                 2007         2006        2007        2006
  Revenues
  Rental revenues (1)          $158,740    $172,845    $477,823    $510,038
  Private capital income          7,564       7,490      22,007      17,539
    Total revenues              166,304     180,335     499,830     527,577
  Costs and expenses
  Property operating costs
   (1)                          (43,028)    (44,540)   (129,926)   (131,671)
  Depreciation and
   amortization                 (40,865)    (46,914)   (122,433)   (133,514)
  Impairment losses                   -           -        (257)     (5,394)
  General and
   administrative               (35,145)    (25,641)    (95,259)    (73,638)
  Other expenses (2)               (944)       (893)     (2,995)     (1,134)
  Fund costs                       (261)       (495)       (779)     (1,588)
    Total costs and
     expenses                  (120,243)   (118,483)   (351,649)   (346,939)
  Other income and expenses
  Equity in earnings of
   unconsolidated joint
   ventures (3)                   3,425       2,239       7,286      12,605
  Other income (2)                7,956       2,911      20,012       8,716
  Gains from sale or
   contribution of real
   estate interests, net              -           -      74,843           -
  Development profits, net
   of taxes                      48,298      23,517      89,486      69,889
  Interest expense,
   including amortization       (28,896)    (43,966)    (96,394)   (127,487)
    Total other income and
     expenses                    30,783     (15,299)     95,233     (36,277)
       Income from
        operations before
        minority interests       76,844      46,553     243,414     144,361
  Minority interests' share
   of income:
    Joint venture partners'
     share of income             (5,889)    (12,014)    (21,149)    (29,310)
    Joint venture partners'
     and limited
     partnership
     unitholders' share of
     development profits         (2,115)     (1,150)     (5,196)     (2,735)
    Preferred unitholders        (1,431)     (3,791)     (6,610)    (12,816)
    Limited partnership
     unitholders                   (614)         17      (4,998)       (994)
      Total minority
       interests' share of
       income                   (10,049)    (16,938)    (37,953)    (45,855)
      Income from
       continuing
       operations                66,795      29,615     205,461      98,506
  Discontinued operations:
    Income attributable to
     discontinued
     operations, net of
     minority interests           2,403       3,559       7,271      13,476
    Gains from disposition
     of real estate, net of
     minority interests           3,912         213       4,329      24,335
      Total discontinued
       operations                 6,315       3,772      11,600      37,811
        Net income               73,110      33,387     217,061     136,317
  Preferred stock dividends      (3,952)     (3,440)    (11,856)     (9,631)
  Preferred unit redemption
   (issuance costs) discount         (3)         16      (2,930)     (1,004)
  Net income available to
   common stockholders          $69,155     $29,963    $202,275    $125,682
  Net income per common
   share (diluted)                $0.69       $0.33       $2.04       $1.39
  Weighted average common
   shares (diluted)         100,914,340  91,058,029  99,311,137  90,458,810


  (1) Effective October 1, 2006, AMB deconsolidated AMB Alliance Fund III on
      a prospective basis. Pro forma rental revenues for the quarter and
      nine months ended September 30, 2006 would have been $152,772 and
      $456,396, respectively, if AMB Institutional Alliance Fund III had
      been deconsolidated as of January 1, 2006. Pro forma property
      operating costs for the quarter and nine months ended September 30,
      2006 would have been $40,298 and $118,974, respectively, if AMB
      Institutional Alliance Fund III had been deconsolidated as of January
      1, 2006.
  (2) Includes changes in liabilities and assets associated with AMB's
      deferred compensation plan.
  (3) There were no gains on sale of operating properties for the quarters
      ended September 30, 2007 and 2006. Includes gains on sale of operating
      properties of $0.0 million and $8.3 million, for the nine months ended
      September 30, 2007 and 2006, respectively.



           CONSOLIDATED STATEMENTS OF FUNDS FROM OPERATIONS(1)
                (dollars in thousands, except share data)

                           For the Quarters Ended  For the Nine Months Ended
                                   September 30,            September 30,
                                 2007        2006        2007         2006
  Net income available to
   common stockholders         $69,155     $29,963     $202,275    $125,682
  Gains from sale or
   contribution of real
   estate, net of minority
   interests                    (3,912)       (213)     (79,172)    (24,335)
  Depreciation and
   amortization:
    Total depreciation and
     amortization               40,865      46,914      122,433     133,514
    Discontinued operations'
     depreciation                  117       1,810        1,061       2,916
    Non-real estate
     depreciation               (1,387)     (1,001)      (3,965)     (3,069)
  Adjustments to derive
   FFO from consolidated
   JVs:
    Joint venture partners'
     minority interests (Net
      income)                    5,889      12,014       21,149      29,310
    Limited partnership
     unitholders' minority
     interests (Net income
     (loss))                       614         (17)       4,998         994
    Limited partnership
     unitholders' minority
     interests (Development
     profits)                    2,115       1,086        3,861       3,260
    Discontinued operations'
     minority interests (Net
     income)                       107         410          267       1,032
    FFO attributable to
     minority interests        (15,731)    (24,471)     (47,347)    (66,654)
  Adjustments to derive
   FFO from unconsolidated
   JVs:
    AMB's share of net
     income                     (3,425)     (2,239)      (7,286)    (12,605)
    AMB's share of FFO           9,828       4,030       21,308       9,335

       Funds from operations  $104,235     $68,286     $239,582    $199,380
       FFO per common share
        and unit (diluted)       $0.99       $0.72        $2.31       $2.10
       Weighted average
        common share and
        unit (diluted)     105,109,868  95,117,597  103,777,347  94,734,736

  Estimated FFO by
   business line (1)
    Capital Partners FFO
     per common share and
     unit (diluted) (1)          $0.03       $0.04        $0.10       $0.09
      % of reported FFO           3.0%        5.6%         4.3%        4.3%
    Development FFO per
     common share and unit
     (diluted) (1)               $0.43       $0.21        $0.79       $0.69
      % of reported FFO          43.4%       29.3%        34.2%       32.8%
    Real estate operations
     FFO per common share
     and unit (diluted) (1)      $0.53       $0.47        $1.42       $1.32
      % of reported FFO          53.6%       65.1%        61.5%       62.9%
       Total FFO per common
        share and unit
        (diluted)                $0.99       $0.72        $2.31       $2.10


  (1) Funds From Operations ("FFO") and Funds From Operations Per Share and
      Unit ("FFOPS"). The Company believes that net income, as defined by
      GAAP, is the most appropriate earnings measure. However, the Company
      considers funds from operations, or FFO, and FFO per share and unit,
      or FFOPS, to be useful supplemental measures of its operating
      performance. Currently and historically, the Company calculates FFO as
      defined by NAREIT as net income, calculated in accordance with GAAP,
      less gains (or losses) from dispositions of real estate held for
      investment purposes and real estate-related depreciation, and
      adjustments to derive the Company's pro rata share of FFO of
      consolidated and unconsolidated joint ventures.  However, if the
      circumstance arises, the Company intends to include in its calculation
      of FFO gains or losses related to sales of previously depreciated real
      estate held for contribution to our joint ventures. Although such a
      change, if instituted, will be a departure from the current NAREIT
      definition, the Company believes such calculation of FFO will better
      reflect the value created as a result of the contributions.  The
      Company defines FFOPS as FFO per fully diluted weighted average share
      of company common stock and operating partnership unit. The Company
      does not adjust FFO to eliminate the effects of non-recurring charges.
      The Company believes that FFO and FFOPS are meaningful supplemental
      measures of its operating performance because historical cost
      accounting for real estate assets in accordance with GAAP implicitly
      assumes that the value of real estate assets diminishes predictably
      over time, as reflected through depreciation and amortization
      expenses. However, since real estate values have historically risen or
      fallen with market and other conditions, many industry investors and
      analysts have considered presentation of operating results for real
      estate companies that use historical cost accounting to be
      insufficient. Thus, FFO and FFOPS are supplemental measures of
      operating performance for real estate investment trusts that exclude
      historical cost depreciation and amortization, among other items, from
      net income, as defined by GAAP. The Company believes that the use of
      FFO and FFOPS, combined with the required GAAP presentations, has been
      beneficial in improving the understanding of operating results of real
      estate investment trusts among the investing public and making
      comparisons of operating results among such companies more meaningful.
      The Company considers FFO and FFOPS to be useful measures for
      reviewing comparative operating and financial performance because, by
      excluding gains or losses related to sales of previously depreciated
      operating real estate assets and real estate depreciation and
      amortization, FFO and FFOPS can help the investing public compare the
      operating performance of a company's real estate between periods or as
      compared to other companies.  While FFO and FFOPS are relevant and
      widely used measures of operating performance of real estate
      investment trusts, these measures do not represent cash flow from
      operations or net income as defined by GAAP and should not be
      considered as alternatives to those measures in evaluating the
      Company's liquidity or operating performance. FFO and FFOPS also do
      not consider the costs associated with capital expenditures related to
      the Company's real estate assets nor are FFO or FFOPS necessarily
      indicative of cash available to fund the Company's future cash
      requirements. Further, the Company's computation of FFO or FFOPS may
      not be comparable to FFO or FFOPS reported by other real estate
      investment trusts that do not define FFO or FFOPS in accordance with
      the current NAREIT definition or that interpret the current NAREIT
      definition differently than the Company does. Estimated FFO by
      Business Line is FFO generated by the Company's Capital Partners,
      development and real estate operations business lines. Estimated
      Capital Partners and Development FFO was determined by reducing
      Capital Partner Income and Development Profits, net of taxes by their
      respective estimated share of general and administrative expenses.
      Capital Partners and Developments estimated allocation of total
      general and administrative expenses was based on their respective
      percentage of actual direct general and administrative expenses
      incurred. Estimated Real Estate Operations FFO represents total
      Company FFO less estimated FFO attributable to Capital Partners and
      Development. Management believes estimated FFO by business line is a
      useful supplemental measure of its operating performance because it
      helps the investing public compare the operating performance of a
      company's respective business lines to other companies' comparable
      business lines. Further, AMB's computation of FFO by business line may
      not be comparable to that reported by other real estate investment
      trusts as they may use different methodologies in computing such
      measures.

First Call Analyst:
FCMN Contact:

SOURCE: AMB Property Corporation

CONTACT: Margan S. Mitchell, Vice President, Corporate Communications of
AMB Property Corporation, +1-415-733-9477, fax, +1-415-477-2177,
[email protected]

Media contact & resources

Jennifer Nelson

VP, Head of Global Corporate Communications
+1 (415) 733 9409
[email protected]
San Francisco, California USA

Corporate Profile

Park Grande, Building

LET'S GET STARTED

Every connection starts with a conversation. Our team is here to help.