AMB Property Corporation(R) , a leading global developer and owner of industrial real estate, today reported results for the third quarter and first nine months of 2008. Funds from operations per fully diluted share and unit ("FFOPS") was $0.70 for the third quarter of 2008, as compared to $0.99 for the same quarter in 2007. The year-over-year variance is primarily related to timing of gains on contribution of development properties to the company's private capital co-investment ventures. FFOPS for the nine months ended September 30, 2008 was $2.41, as compared to $2.31 for the same period in 2007.

Net income available to common stockholders per fully diluted share ("EPS") for the third quarter of 2008 was $0.24, as compared to $0.69 for the same quarter in 2007. EPS for the nine months ended September 30, 2008 was $1.37, as compared to $2.04 for the same period in 2007.

Owned and Managed Portfolio Operating Results

AMB's operating portfolio was 95.4 percent occupied at September 30, 2008, up 20 basis points from June 30, 2008. Cash-basis same store net operating income ("SSNOI"), without the effects of lease termination fees, increased 3.5 percent in the third quarter and 4.9 percent in the first nine months of 2008, over the same periods in 2007. For the trailing four quarters ended September 30, 2008, average rent change on renewals and rollovers in AMB's operating portfolio increased 4.1 percent, following an average increase of 4.3 percent for the trailing four quarters ended June 30, 2008.

"We continue to run AMB for the long term. Our operating fundamentals remained solid through the third quarter as a result of our long-established focus on the best markets around the globe," said Hamid R. Moghadam, AMB's chairman & CEO. "The environment became more challenging at the beginning of the fourth quarter, so it may be difficult to keep this pace of growth into 2009. However, we are confident that AMB's strategy, people and portfolio will outperform on a relative basis, even in a more difficult economic environment. We remain focused on sound execution and long-term value preservation."

Investment Activity

During the quarter, the company commenced development on 1.6 million square feet in the Americas and Europe, with an estimated total investment of $132 million. At quarter end, AMB's development pipeline, which included investments held through unconsolidated joint ventures, totaled approximately 17.8 million square feet globally, with an estimated total investment of $1.5 billion.

The company's development business includes contributions of stabilized properties to affiliated private capital co-investment ventures or sale of projects to third parties. During the third quarter, AMB contributed or sold 2.2 million square feet in the Americas and Asia, including contributions to three of its co-investment ventures, for an aggregate value of approximately $192 million.

Also during the quarter, AMB acquired 1.6 million square feet of industrial distribution space for an aggregate acquisition cost of approximately $140 million. Property and land acquisitions during the quarter expanded AMB's presence in target markets in the Americas and Asia, including Beijing and Guangzhou, which were market entries for AMB.

"Given the current turbulence, lack of clarity on pricing and availability of capital we intend to be increasingly selective with our capital deployment decisions. We plan to start projects only where the market demand is sound and where profit expectations justify the risks. As such, we expect the pace of development starts to slow considerably from our previous outlook," Mr. Moghadam added.

Financing Activities

"The instability in the credit markets, which have become more volatile over the past few weeks, has made financing transactions increasingly difficult," said Thomas S. Olinger, AMB's chief financial officer. "While the timing, availability and pricing have become unpredictable, our balance sheet remains strong and we have the capacity to continue to support our business."

During the quarter, AMB closed a $230 million, two-year secured term loan priced at LIBOR plus 130 basis points. The loan includes a one-year extension, which can be exercised at the company's option. Additionally, AMB closed on $768 million in property level financings in the U.S., Europe and Japan.

2008 Guidance

Due to the change in the timing of certain transactions, caused primarily by the turmoil in financing markets, the company is lowering its full year 2008 FFO guidance to $3.05 to $3.10 per share. Full year EPS guidance has also been lowered to $1.58 to $1.63 per share. The company will provide details of its revised outlook for 2009 during their third quarter earnings conference call.

Organizational Update

As previously announced in the quarter, AMB acquired the remaining 42 percent equity interest in G. Accion, S.A. de C.V. ("G. Accion") that it had not previously owned. G. Accion is now a wholly owned subsidiary and has been renamed AMB Property Mexico. This newly unified platform will continue to develop, lease, acquire and operate industrial real estate in Mexico.

During the quarter, AMB and the City and County of San Francisco Employees' Retirement System contributed their interests in AMB Partners II, a co-investment venture comprising 10.3 million square feet of U.S. industrial property, to AMB Institutional Alliance Fund III in exchange for partnership interests in Fund III.

Supplemental Earnings Measure

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 the company'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, 2006. In deriving SSNOI, the company defines NOI as rental revenues, including reimbursements, less property operating expenses, both of which are calculated in accordance with GAAP. Property operating expenses exclude depreciation, amortization, general and administrative expenses and interest expense. The company defines SSNOI to also exclude straight-line rents and amortization of lease intangibles. 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 the company'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 percent 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 2008 results on Thursday, October 16, 2008 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 64987472. A webcast can be accessed through a link titled "Q3 2008 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 Thursday, October 16, 2008 until 8:00 PM EST on Friday, November 14, 2008. 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 64987472. 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 in the Americas, Europe and Asia. As of September 30, 2008, AMB owned, or had investments in, on a consolidated basis or through unconsolidated joint ventures, properties and development projects expected to total approximately 158.4 million square feet (14.7 million square meters) in 49 markets within 15 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 continued demand for our product, status of key operating metrics, our ability to capitalize on trends and realize growth, effectiveness of our strategies, performance of our portfolio, occupancy levels, rent growth, SSNOI growth, our development projects (including completion, timing of stabilization, our ability to lease such projects, square feet at stabilization or completion, costs and total investment amounts), our ability to contribute properties to and acquire properties in our private capital co-investment ventures, our ability to accomplish future business plans, strength of our balance sheet, our ability to access credit markets and enter into credit and financing agreements and to meet our forecasts (including our FFO and EPS guidance) 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 or renewal at lower than expected rent, increased interest rates and operating costs or greater than expected capital expenditures, 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, redevelopment, value-added conversion 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, inflation risks, 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, risks of opening offices globally, risks of changing personnel and roles, 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, 2007.

                Consolidated Statements of Operations (1)
             (in thousands, except share and per share data)

                                          For the             For the
                                      Quarters ended     Nine Months ended
                                       September 30,       September 30,
                                       2008      2007      2008      2007
  Revenues
    Rental revenues                  $152,993  $157,805  $487,071  $474,752
    Private capital revenues(2)         9,502     7,564    60,838    22,007
        Total revenues                162,495   165,369   547,909   496,759

  Costs and expenses
    Property operating costs          (44,157)  (42,664) (138,375) (128,785)
    Depreciation and amortization     (46,985)  (40,628) (129,493) (121,641)
    General and administrative        (34,415)  (35,145) (103,361)  (95,259)
    Fund costs                           (312)     (261)     (919)     (779)
    Impairment losses                       -         -         -      (257)
    Other expenses(3)                   1,088      (944)    1,926    (2,995)
        Total costs and expenses     (124,781) (119,642) (370,222) (349,716)

  Other income and expenses
    Development gains, net of taxes    28,026    48,298    76,248    89,486
    Gains from sale or contribution of
     real estate interests, net             -         -    19,967    74,843
    Equity in earnings of
     unconsolidated co-investment
     ventures                           5,372     3,425    14,359     7,286
    Other income(3)                    (4,229)    7,956       (51)   20,012
    Interest expense, including
     amortization                     (32,319)  (29,326) (100,955)  (97,486)
        Total other income and
         expenses                      (3,150)   30,353     9,568    94,141
    Income from operations before
     minority interests                34,564    76,080   187,255   241,184
    Minority interests' share of
     income
      Co-investment venture partners'
       share of income                 (4,194)   (5,890)  (29,393)  (21,088)
      Co-investment venture partners'
       and limited partnership
       unitholders' share of development
       gains                           (1,090)   (2,115)   (7,204)   (5,196)
      Preferred unitholders            (1,431)   (1,431)   (4,295)   (6,610)
      Limited partnership unitholders     137      (581)   (2,518)   (4,903)
        Total minority interests'
         share of income               (6,578)  (10,017)  (43,410)  (37,797)
          Income from continuing
           operations                  27,986    66,063   143,845   203,387
    Discontinued operations
      Income attributable to
       discontinued operations, net of
       minority interests                 177     3,135     2,066     9,345
      Gains from disposition of real
       estate, net of minority interests  (12)    3,912     2,191     4,329
        Total discontinued operations     165     7,047     4,257    13,674
          Net income                   28,151    73,110   148,102   217,061
    Preferred stock dividends          (3,952)   (3,952)  (11,856)  (11,856)
    Preferred unit redemption
     (issuance costs) discount              -        (3)        -    (2,930)
  Net income available to common
   stockholders                       $24,199   $69,155  $136,246  $202,275
  Net income per common share
   (diluted)                            $0.24     $0.69     $1.37     $2.04
  Weighted average common shares
   (diluted)                           98,952   100,914    99,457    99,311

   (1)  On July 1, 2008, the partners of AMB Partners II (previously, a
        consolidated co-investment venture) contributed their interests in
        AMB Partners II to AMB Institutional Alliance Fund III in exchange
        for interests in AMB Institutional Alliance Fund III, an
        unconsolidated co-investment venture.
   (2)  Includes incentive and promote distributions for 2008 of $33.0
        million for AMB Institutional Alliance Fund III received during the
        quarter ended June 30, 2008 and of $1.0 million for the dissolution
        of AMB Erie co-investment venture received during the quarter ended
        March 31, 2008.
   (3)  Includes changes in liabilities and assets associated with AMB's
        deferred compensation plan.



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

                                          For the             For the
                                      Quarters ended     Nine Months ended
                                       September 30,       September 30,
                                       2008      2007      2008      2007
  Net income available to common
   stockholders                       $24,199   $69,155  $136,246  $202,275
    Gains (losses) from sale or contribution
     of real estate, net of minority
     interests                             12    (3,912)  (22,158)  (79,172)
    Depreciation and amortization
      Total depreciation and
       amortization                    46,985    40,628   129,493   121,641
      Discontinued operations'
       depreciation                         4       354        61     1,853
      Non-real estate depreciation     (1,997)   (1,387)   (5,786)   (3,965)
    Adjustments to derive FFO from
     consolidated co-investment
     ventures
      Co-investment venture partners'
       minority interests (Net income)  4,194     5,890    29,393    21,088
      Limited partnership unitholders'
       minority interests (Net income)   (137)      581     2,518     4,903
      Limited partnership unitholders'
       minority interests (Development
       profits)                         1,090     2,115     2,795     3,861
      Discontinued operations' minority
       interests (Net income)               8       139       316       423
      FFO attributable to minority
       interests                       (8,819)  (15,731)  (41,812)  (47,347)
    Adjustments to derive FFO from
     unconsolidated co-investment
     ventures
      AMB's share of net income        (5,372)   (3,425)  (14,359)   (7,286)
      AMB's share of FFO               11,589     9,828    32,727    21,308
  Funds from operations               $71,756  $104,235  $249,434  $239,582
  FFO per common share and unit
   (diluted)                            $0.70     $0.99     $2.41     $2.31
  Weighted average common shares and
   units (diluted)                    102,922   105,110   103,430   103,777


   (1)  Funds From Operations ("FFO") and Funds From Operations Per Share
        and Unit ("FFOPS"). AMB believes that net income, as defined by U.S.
        GAAP, is the most appropriate earnings measure. However, AMB
        considers funds from operations, or FFO, and FFO per share and unit,
        or FFOPS, to be useful supplemental measures of its operating
        performance. AMB defines FFOPS as FFO per fully diluted weighted
        average share of AMB's common stock and operating partnership units.
        AMB calculates FFO as net income, calculated in accordance with U.S.
        GAAP, less gains (or losses) from dispositions of real estate held
        for investment purposes and real estate-related depreciation, and
        adjustments to derive AMB's pro rata share of FFO of consolidated
        and unconsolidated joint ventures.  AMB does not adjust FFO to
        eliminate the effects of non-recurring charges.  AMB includes the
        gains from development, including those from value added conversion
        projects, before depreciation recapture, as a component of FFO.  AMB
        believes that value-added conversion dispositions are in substance
        land sales and as such should be included in FFO, consistent with
        the real estate investment trust industry's long standing practice
        to include gains on the sale of land in FFO. However, AMB's
        interpretation of FFO or FFOPS may not be consistent with the views
        of others in the real estate investment trust industry, who may
        consider it to be a divergence from the National Association of Real
        Estate Investment Trusts' (NAREIT) definition, and may not be
        comparable to FFO or FFOPS reported by other real estate investment
        trusts that interpret the current NAREIT definition differently than
        AMB does.

        In connection with the formation of a co-investment venture, AMB may
        warehouse assets that are acquired with the intent to contribute
        these assets to the newly formed venture. Some of the properties
        held for contribution may, under certain circumstances, be required
        to be depreciated under U.S. GAAP.  If this circumstance arises, AMB
        intends to include in its calculation of FFO gains or losses related
        to the contribution of previously depreciated real estate to joint
        ventures. Although such a change, if instituted, will be a departure
        from the current NAREIT definition, AMB believes such calculation of
        FFO will better reflect the value created as a result of the
        contributions. To date, AMB has not included gains or losses from
        the contribution of previously depreciated warehoused assets in FFO.

        AMB believes that FFO and FFOPS are meaningful supplemental measures
        of its operating performance because historical cost accounting for
        real estate assets in accordance with U.S. 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 U.S. GAAP. AMB believes that the use
        of FFO and FFOPS, combined with the required U.S. 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. AMB 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 U.S.
        GAAP and should not be considered as alternatives to those measures
        in evaluating AMB's liquidity or operating performance. FFO and
        FFOPS also do not consider the costs associated with capital
        expenditures related to AMB's real estate assets nor are FFO or
        FFOPS necessarily indicative of cash available to fund AMB's future
        cash requirements.

        The following table reconciles projected FFO from projected net
        income for the year ended December 31, 2008:



                                                            2008
                                                    Low               High

  Projected net income                             $1.58             $1.63
  AMB's share of projected depreciation
   and amortization                                 1.60              1.60
  AMB's share of projected gains on
   disposition of operating properties             (0.07)            (0.07)
  Impact of additional dilutive
   securities, other, rounding                     (0.06)            (0.06)
  Projected Funds From Operations (FFO)            $3.05             $3.10


  Amounts are expressed per share, except FFO which is expressed per share
  and unit.



                     CONSOLIDATED BALANCE SHEETS (1)(2)
                           (dollars in thousands)

                                                         As of
                                            September 30,      December 31,
                                                 2008              2007
  Assets
    Investments in real estate
      Total investments in properties         $6,315,790        $6,709,545
      Accumulated depreciation                  (928,831)         (916,686)
        Net investments in properties          5,386,959         5,792,859
      Investments in unconsolidated co-
       investment ventures                       433,649           356,194
      Properties held for contribution, net      693,805           488,339
      Properties held for divestiture, net        81,347            40,513
        Net investments in real estate         6,595,760         6,677,905
   Cash and cash equivalents and
    restricted cash                              309,547           250,416
   Accounts receivable, net                      163,118           184,270
   Other assets                                  249,393           149,812
  Total assets                                $7,317,818        $7,262,403

  Liabilities and stockholders' equity
    Secured debt                              $1,384,409        $1,471,087
    Unsecured senior debt                      1,153,582         1,003,123
    Unsecured credit facilities                  816,875           876,105
    Other debt                                   403,357           144,529
    Accounts payable and other
     liabilities                                 411,050           306,196
          Total liabilities                    4,169,273         3,801,040

    Minority interests
      Co-investment venture partners             282,083           517,572
      Preferred unitholders                       77,561            77,561
      Limited partnership unitholders             92,614           102,278
          Total minority interests               452,258           697,411
    Stockholders' equity
      Common equity                            2,472,875         2,540,540
      Preferred equity                           223,412           223,412
      Total stockholders' equity               2,696,287         2,763,952
      Total liabilities and stockholders'
       equity                                 $7,317,818        $7,262,403

   (1)  During the quarter ended September 30, 2008, AMB acquired the
        remaining equity interest (approximately 42%) in G. Accion, a
        Mexican real estate company. Total assets and total liabilities
        include $223,829 and $174,217, respectively, related to G. Accion
        as of September 30, 2008.
   (2)  On July 1, 2008, the partners of AMB Partners II (previously, a
        consolidated co-investment venture) contributed their interests in
        AMB Partners II to AMB Institutional Alliance Fund III in exchange
        for interests in AMB Institutional Alliance Fund III, an
        unconsolidated co-investment venture.

First Call Analyst:
FCMN Contact: [email protected]

SOURCE: AMB Property Corporation

CONTACT: Tracy A. Ward, Vice President, Investor Relations,
+1-415-733-9565, fax, +1-415-477-2044, [email protected], or Rachel E.M. Bennett,
Director, Media & Public Relations, +1-415-733-9532, fax, +1-415-477-2063,
[email protected], both of AMB Property Corporation

Media contact & resources

Jennifer Nelson

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

Corporate Profile

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