##### Table of Contents





UNITED STATES SECURITIES AND
    EXCHANGE COMMISSIONWashington, DC
    20549
      Form 10-Q
      (Mark One)þ

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
    SECURITIES EXCHANGE ACT OF 1934For the quarterly period ended June 30,
    2009ORo

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
    SECURITIES EXCHANGE ACT OF 1934   001-13545  001-14245
   AMB Property
    Corporation
 AMB Property, L.P.
 (Exact Name of Registrant as
    Specified in Its Charter)
   Maryland (AMB Property Corporation)
    Delaware (AMB Property, L.P.)(State or Other Jurisdiction
    of
    Incorporation or Organization)

94-3281941
    94-3285362(I.R.S. Employer
    Identification No.)Pier 1, Bay 1, San Francisco, California(Address of Principal
    Executive Offices)

94111(Zip
    Code)   (415) 394-9000
 (Registrants Telephone
    Number, Including Area Code)
    AMB Property Corporation


Yes þ     No oAMB Property, L.P.


Yes þ     No o   Regulation S-T o o
  12b-2
   Large
    accelerated
    filer þ
    Accelerated
    filer o
    Non-accelerated
    filer o
    Smaller
    reporting
    company o   Large
    accelerated
    filer o
    Accelerated
    filer o
    Non-accelerated
    filer þ
    Smaller
    reporting
    company o  Rule 12b-2
  AMB Property Corporation


Yes o     No þAMB Property, L.P.


Yes o     No þ




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##### Table of Contents





EXPLANATORY
    NOTE
  Form 10-Q
  day-to-day
  Form 10-Q
  
    enhancing investors understanding of the parent company
    and the operating partnership by enabling investors to view the
    business as a whole in the same manner as management views and
    operates the business;
    eliminating duplicative disclosure and providing a more
    streamlined and readable presentation since a substantial
    portion of the companys disclosure applies to both the
    parent company and the operating partnership; and
    creating time and cost efficiencies through the preparation of
    one combined report instead of two separate reports.




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##### Table of Contents




    consolidated financial statements;
    the following notes to the consolidated financial statements:  
    Debt;
    Noncontrolling Interests; and
    Stockholders Equity of the Parent Company/Partners
    Capital of the Operating Partnership; and  
    Liquidity and Capital Resources in the Managements
    Discussion and Analysis of Financial Condition and Results of
    Operations.  Rule 13a-15 Rule 15d-15




---



##### 



AMB
    PROPERTY CORPORATION AND AMB PROPERTY, L.P.
  INDEX
   
 PagePART I. FINANCIAL INFORMATIONItem 1.


Financial Statements of AMB Property Corporation
    (unaudited)Consolidated Balance Sheets as of June 30,
    2009 and December 31, 2008


1Consolidated Statements of Operations for the
    Three and Six Months Ended June 30, 2009 and 2008


2Consolidated Statement of Equity for the Six
    Months Ended June 30, 2009


3Consolidated Statements of Cash Flows for the Six
    Months Ended June 30, 2009 and 2008


4Financial Statements of AMB Property, L.P.
    (unaudited)Consolidated Balance Sheets as of June 30,
    2009 and December 31, 2008


5Consolidated Statements of Operations for the
    Three and Six Months Ended June 30, 2009 and 2008


6Consolidated Statement of Capital for the Six
    Months Ended June 30, 2009


7Consolidated Statements of Cash Flows for the Six
    Months Ended June 30, 2009 and 2008


8Notes to Consolidated Financial Statements of AMB
    Property Corporation and AMB Property, L.P.


9Item 2.


Managements Discussion and Analysis of
    Financial Condition and Results of Operations


50Item 3.


Quantitative and Qualitative Disclosures About
    Market Risk


100Item 4.


Controls and Procedures (AMB Property
    Corporation)


102Controls and Procedures (AMB Property, L.P.)


102PART II. OTHER INFORMATIONItem 1.


Legal Proceedings


103Item 1A.


Risk Factors


103Item 2.


Unregistered Sales of Equity Securities and Use
    of Proceeds


103Item 3.


Defaults Upon Senior Securities


103Item 4.


Submission of Matters to a Vote of Security
    Holders (AMB Property Corporation)


103Item 5.


Other Information


103Item 6.


Exhibits


104EX-31.1EX-31.2EX-32.1EX-32.2




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##### Table of Contents



PART I  Item 1.
    Financial
    Statements of AMB Property Corporation  AMB
    PROPERTY CORPORATIONCONSOLIDATED BALANCE SHEETSAs of June 30, 2009 and
    December 31, 2008
  June 30,


December 31,2009


2008(Unaudited, Dollars in thousands)ASSETSInvestments in real estate:Land

$
1,049,168


$
1,108,193Land held for development


673,349



677,028Buildings and improvements


3,604,945



3,525,871Construction in progress


508,331



1,292,764Total investments in properties


5,835,793



6,603,856Accumulated depreciation and amortization


(1,014,490
)


(970,737
)Net investments in properties


4,821,303



5,633,119Investments in unconsolidated joint ventures


434,008



431,322Properties held for sale or contribution, net


1,072,543



609,023Net investments in real estate


6,327,854



6,673,464Cash and cash equivalents


185,906



223,936Restricted cash


23,439



27,295Accounts receivable, net of allowance for doubtful accounts of
    $11,565 and $10,682, respectively


142,288



160,528Deferred financing costs, net


19,050



25,277Other assets


186,711



191,148Total assets

$
6,885,248


$
7,301,648LIABILITIES AND EQUITYLiabilities:Secured debt

$
1,383,862


$
1,522,571Unsecured senior debt


871,369



1,153,926Unsecured credit facilities


594,942



920,850Other debt


392,113



392,838Total debt


3,242,286



3,990,185Security deposits


50,841



59,093Dividends payable


45,204



3,395Accounts payable and other liabilities


255,004



282,771Total liabilities


3,593,335



4,335,444Commitments and contingencies (Note 15)Equity:Stockholders equity:Series L preferred stock, cumulative, redeemable,
    $.01 par value, 2,300,000 shares authorized and
    2,000,000 issued and outstanding, $50,000 liquidation preference


48,017



48,017Series M preferred stock, cumulative, redeemable,
    $.01 par value, 2,300,000 shares authorized and
    2,300,000 issued and outstanding, $57,500 liquidation preference


55,187



55,187Series O preferred stock, cumulative, redeemable,
    $.01 par value, 3,000,000 shares authorized and
    3,000,000 issued and outstanding, $75,000 liquidation preference


72,127



72,127Series P preferred stock, cumulative, redeemable,
    $.01 par value, 2,000,000 shares authorized and
    2,000,000 issued and outstanding, $50,000 liquidation preference


48,081



48,081Common stock, $.01 par value, 500,000,000 shares
    authorized, 146,253,416 and 98,469,872 issued and outstanding,
    respectively


1,459



981Additional paid-in capital


2,734,993



2,241,802Retained (deficit) earnings


(78,059
)


26,869Accumulated other comprehensive (loss) income


(10,503
)


22,043Total stockholders equity


2,871,302



2,515,107Noncontrolling interests:Joint venture partners


280,714



293,367Preferred unitholders


77,561



77,561Limited partnership unitholders


62,336



80,169Total noncontrolling interests


420,611



451,097Total equity


3,291,913



2,966,204Total liabilities and equity

$
6,885,248


$
7,301,648    1




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##### Table of Contents



AMB
    PROPERTY CORPORATIONCONSOLIDATED STATEMENTS OF OPERATIONS
    For the Three and Six Months Ended June 30, 2009 and
    2008
  For the Three Months


For the Six MonthsEnded June 30,


Ended June 30,2009


2008


2009


2008(Unaudited, Dollars in thousands, except per


(Unaudited, Dollars in thousands, except pershare amounts)


share amounts)REVENUESRental revenues

$
139,575


$
161,127


$
289,860


$
321,323Private capital revenues


7,795



41,413



19,490



51,336Total revenues


147,370



202,540



309,350



372,659COSTS AND EXPENSESProperty operating costs


(21,980
)


(23,820
)


(50,414
)


(47,467
)Real estate taxes


(20,533
)


(22,389
)


(40,791
)


(43,225
)Depreciation and amortization


(38,724
)


(39,730
)


(80,460
)


(80,214
)General and administrative


(25,363
)


(33,744
)


(56,609
)


(68,869
)Restructuring charges


(3,824
)






(3,824
)


Fund costs


(322
)


(384
)


(584
)


(606
)Real estate impairment losses










(161,067
)


Other expenses


(5,684
)


(1,422
)


(5,022
)


(1,330
)Total costs and expenses


(116,430
)


(121,489
)


(398,771
)


(241,711
)OTHER INCOME AND EXPENSESDevelopment profits, net of taxes






30,402



33,286



48,222Gains from sale or contribution of real estate interests, net














19,967Equity in earnings of unconsolidated joint ventures, net


4,284



6,059



4,250



8,987Other income


8,595



1,883



1,529



6,293Interest expense, including amortization


(29,329
)


(36,532
)


(61,986
)


(67,603
)Total other income and expenses, net


(16,450
)


1,812



(22,921
)


15,866Income (loss) from continuing operations


14,490



82,863



(112,342
)


146,814Discontinued operations:Income (loss) attributable to discontinued operations


4,454



4,008



(10,684
)


8,074Gains from sale of real estate interests, net of taxes


10,090



1,159



28,704



2,547Total discontinued operations


14,544



5,167



18,020



10,621Net income (loss)


29,034



88,030



(94,322
)


157,435Noncontrolling interests share of net income:Joint venture partners share of net income


(4,949
)


(6,424
)


(2,771
)


(25,687
)Joint venture partners and limited partnership
    unitholders share of development profits






(1,371
)


(1,108
)


(6,113
)Preferred unitholders


(1,432
)


(1,432
)


(2,864
)


(2,864
)Limited partnership unitholders


(1,279
)


(1,784
)


4,041



(2,820
)Total noncontrolling interests share of net income


(7,660
)


(11,011
)


(2,702
)


(37,484
)Net income (loss) attributable to AMB Property Corporation


21,374



77,019



(97,024
)


119,951Preferred stock dividends


(3,952
)


(3,952
)


(7,904
)


(7,904
)Allocation to participating securities


(260
)


(666
)


(521
)


(1,018
)Net income (loss) available to common stockholders

$
17,162


$
72,401


$
(105,449
)

$
111,029Basic income (loss) per common share attributable to AMB
    Property CorporationIncome (loss) from continuing operations (after preferred stock
    dividends)

$
0.04


$
0.71


$
(0.98
)

$
1.05Discontinued operations


0.08



0.04



0.12



0.09Net income (loss) available to common stockholders

$
0.12


$
0.75


$
(0.86
)

$
1.14Diluted income (loss) per common share attributable to
    AMB Property CorporationIncome (loss) from continuing operations (after preferred stock
    dividends)

$
0.04


$
0.69


$
(0.98
)

$
1.03Discontinued operations


0.08



0.04



0.12



0.09Net income (loss) available to common stockholders

$
0.12


$
0.73


$
(0.86
)

$
1.12WEIGHTED AVERAGE COMMON SHARES OUTSTANDINGBasic


145,318,364



97,083,044



121,991,039



97,433,162Diluted


145,379,807



99,269,047



121,991,039



99,482,367    2




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##### Table of Contents



AMB
    PROPERTY CORPORATIONCONSOLIDATED STATEMENT OF EQUITY
    For the Six Months Ended June 30, 2009
 (Unaudited, Dollars in thousands)
  AccumulatedCommon Stock


Additional


Retained


OtherPreferred


Number





Paid-in


Earnings


Comprehensive


NoncontrollingStock


of Shares


Amount


Capital


(Deficit)


Income (Loss)


Interests


TotalBalance as of December 31, 2008

$
223,412



98,469,872


$
981


$
2,241,802


$
26,869


$
22,043


$
451,097


$
2,966,204Net income (loss)


7,904















(104,928
)






2,702Unrealized gain on securities and derivatives






















1,952



Currency translation adjustment






















(34,498
)


Total comprehensive loss






























(126,868
)Contributions


























6,444



6,444Distributions and allocations


























(17,973
)


(17,973
)Issuance of common stock, net






47,437,500



474



551,855















552,329Stock-based compensation amortization and issuance of restricted
    stock, net






388,126



4



11,945















11,949Exercise of stock options






8,174







130















130Redemption of partnership units


























(71
)


(71
)Repurchase of noncontrolling interest














(859
)










(8,909
)


(9,768
)Forfeiture of restricted stock






(50,256
)






(789
)














(789
)Reallocation of partnership interest














12,679











(12,679
)


Dividends


(7,904
)










(81,770
)














(89,674
)Balance as of June 30, 2009

$
223,412



146,253,416


$
1,459


$
2,734,993


$
(78,059
)

$
(10,503
)

$
420,611


$
3,291,913    3




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##### Table of Contents



AMB
    PROPERTY CORPORATIONCONSOLIDATED STATEMENTS OF CASH FLOWS
    For the Six Months Ended June 30, 2009 and 2008
   2009


2008(Unaudited, Dollars in thousands)CASH FLOWS FROM OPERATING ACTIVITIESNet (loss) income

$
(94,322
)

$
157,435Adjustments to net (loss) income:Straight-line rents and amortization of lease intangibles


(4,934
)


(6,040
)Depreciation and amortization


80,460



80,214Real estate impairment losses


161,067



Foreign exchange losses (gains)


4,980



(591
)Stock-based compensation amortization


11,949



11,623Equity in earnings of unconsolidated joint ventures


(4,250
)


(8,987
)Operating distributions received from unconsolidated joint
    ventures


2,406



14,159Gains from sale or contribution of real estate interests, net






(19,967
)Development profits, net of taxes


(33,286
)


(48,222
)Debt premiums, discounts and finance cost amortization, net


6,484



4,378Discontinued operations:Depreciation and amortization


2,315



2,351Real estate impairment losses


20,786



Gains from sale of real estate interests, net of taxes


(28,704
)


(2,547
)Changes in assets and liabilities:Accounts receivable and other assets


7,224



(40,884
)Accounts payable and other liabilities


(11,047
)


(15,326
)Net cash provided by operating activities


121,128



127,596CASH FLOWS FROM INVESTING ACTIVITIESChange in restricted cash


(3,629
)


(9,205
)Cash paid for property acquisitions






(148,173
)Additions to land, buildings, development costs, building
    improvements and lease costs


(270,801
)


(539,608
)Net proceeds from divestiture of real estate and securities


278,580



327,516Additions to interests in unconsolidated joint ventures


(4,160
)


(33,483
)Repayment of mortgage and loan receivables






77,504Purchase of noncontrolling interest


(8,968
)


Capital distributions received from unconsolidated joint ventures


5,350



12,622Loans made to affiliates






(73,480
)Purchase of equity interests, net






(10,678
)Net cash used in investing activities


(3,628
)


(396,985
)CASH FLOWS FROM FINANCING ACTIVITIESIssuance of common stock and units, net


552,258



Proceeds from stock option exercises


130



3,484Repurchase and retirement of common stock






(87,696
)Borrowings on secured debt


21,688



209,591Payments on secured debt


(50,729
)


(156,598
)Borrowings on other debt






525,000Payments on other debt


(488
)


(101,842
)Borrowings on unsecured credit facilities


407,702



967,750Payments on unsecured credit facilities


(709,065
)


(972,420
)Payment of financing fees


(2,941
)


(7,596
)Net proceeds from issuances of senior debt






325,000Payments on senior debt


(283,205
)


(175,000
)Contributions from joint venture partners


6,444



6,955Dividends paid to common and preferred stockholders


(47,410
)


(108,172
)Distributions to noncontrolling interests, including preferred
    units


(11,695
)


(43,931
)Net cash (used in) provided by financing activities


(117,311
)


384,525Net effect of exchange rate changes on cash


(38,219
)


4,395Net (decrease) increase in cash and cash equivalents


(38,030
)


119,531Cash and cash equivalents at beginning of period


223,936



220,224Cash and cash equivalents at end of period

$
185,906


$
339,755SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATIONCash paid for interest, net of capitalized interest

$
64,594


$
70,340Non-cash transactions:Acquisition of properties

$



$
155,045Assumption of other assets and liabilities






(970
)Acquisition capital






(5,902
)Net cash paid for property acquisitions

$



$
148,173Contribution of properties to unconsolidated joint ventures, net

$
8,879


$
5,546    4




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##### Table of Contents



Item 1.
    Financial
    Statements of AMB Property, L.P.  AMB
    PROPERTY, L.P.CONSOLIDATED BALANCE SHEETS
    As of June 30, 2009 and December 31, 2008
  June 30,


December 31,2009


2008(Unaudited, Dollars in thousands)ASSETSInvestments in real estate:Land

$
1,049,168


$
1,108,193Land held for development


673,349



677,028Buildings and improvements


3,604,945



3,525,871Construction in progress


508,331



1,292,764Total investments in properties


5,835,793



6,603,856Accumulated depreciation and amortization


(1,014,490
)


(970,737
)Net investments in properties


4,821,303



5,633,119Investments in unconsolidated joint ventures


434,008



431,322Properties held for sale or contribution, net


1,072,543



609,023Net investments in real estate


6,327,854



6,673,464Cash and cash equivalents


185,906



223,936Restricted cash


23,439



27,295Accounts receivable, net of allowance for doubtful accounts of
    $11,565 and $10,682, respectively


142,288



160,528Deferred financing costs, net


19,050



25,277Other assets


186,711



191,148Total assets

$
6,885,248


$
7,301,648LIABILITIES AND CAPITALDebt:Secured debt

$
1,383,862


$
1,522,571Unsecured senior debt


871,369



1,153,926Unsecured credit facilities


594,942



920,850Other debt


392,113



392,838Total debt


3,242,286



3,990,185Security deposits


50,841



59,093Distributions payable


45,204



3,395Accounts payable and other liabilities


255,004



282,771Total liabilities


3,593,335



4,335,444Commitments and contingencies (Note 15)CapitalPartners capital:General partner, 146,024,005 and 98,240,461 units
    outstanding, respectively; 2,000,000 Series L preferred
    units issued and outstanding with a $50,000 liquidation
    preference, 2,300,000 Series M preferred units issued and
    outstanding with a $57,500 liquidation preference, 3,000,000
    Series O preferred units issued and outstanding with a
    $75,000 liquidation preference and 2,000,000 Series P
    preferred units issued and outstanding with a $50,000
    liquidation preference


2,871,302



2,515,107Limited partners, 2,176,809 and 2,180,809 units
    outstanding, respectively


39,497



50,831Total partners capital


2,910,799



2,565,938Noncontrolling interests:Joint venture partners


280,714



293,367Preferred unitholders


77,561



77,561Class B limited partnership unitholders


22,839



29,338Total noncontrolling interests


381,114



400,266Total capital


3,291,913



2,966,204Total liabilities and capital

$
6,885,248


$
7,301,648    5




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##### Table of Contents



AMB
    PROPERTY, L.P.CONSOLIDATED STATEMENTS OF OPERATIONS
    For the Three and Six Months Ended June 30, 2009 and
    2008
  For the Three Months


For the Six MonthsEnded June 30,


Ended June 30,2009


2008


2009


2008(Unaudited, Dollars in


(Unaudited, Dollars inthousands, except per unit


thousands, except per unitamounts)


amounts)REVENUESRental revenues

$
139,575


$
161,127


$
289,860


$
321,323Private capital revenues


7,795



41,413



19,490



51,336Total revenues


147,370



202,540



309,350



372,659COSTS AND EXPENSESProperty operating expenses


(21,980
)


(23,820
)


(50,414
)


(47,467
)Real estate taxes


(20,533
)


(22,389
)


(40,791
)


(43,225
)Depreciation and amortization


(38,724
)


(39,730
)


(80,460
)


(80,214
)General and administrative


(25,363
)


(33,744
)


(56,609
)


(68,869
)Restructuring charges


(3,824
)






(3,824
)


Fund costs


(322
)


(384
)


(584
)


(606
)Real estate impairment losses










(161,067
)


Other expenses


(5,684
)


(1,422
)


(5,022
)


(1,330
)Total costs and expenses


(116,430
)


(121,489
)


(398,771
)


(241,711
)OTHER INCOME AND EXPENSESDevelopment profits, net of taxes






30,402



33,286



48,222Gains from sale or contribution of real estate interests, net














19,967Equity in earnings of unconsolidated joint ventures, net


4,284



6,059



4,250



8,987Other income


8,595



1,883



1,529



6,293Interest expense, including amortization


(29,329
)


(36,532
)


(61,986
)


(67,603
)Total other income and expenses, net


(16,450
)


1,812



(22,921
)


15,866Income (loss) from continuing operations


14,490



82,863



(112,342
)


146,814Discontinued operations:Income (loss) attributable to discontinued operations


4,454



4,008



(10,684
)


8,074Gains from sale of real estate interests, net of taxes


10,090



1,159



28,704



2,547Total discontinued operations


14,544



5,167



18,020



10,621Net income (loss)


29,034



88,030



(94,322
)


157,435Noncontrolling interests share of net income:Joint venture partners share of net income


(4,949
)


(6,424
)


(2,771
)


(25,687
)Joint venture partners share of development profits






(196
)






(4,409
)Preferred unitholders


(1,432
)


(1,432
)


(2,864
)


(2,864
)Class B limited partnership unitholders


(468
)


(861
)


1,074



(1,171
)Total noncontrolling interests share of net (income) loss


(6,849
)


(8,913
)


(4,561
)


(34,131
)Net income (loss) attributable to AMB Property, L.P.


22,185



79,117



(98,883
)


123,304Series L, M, O and P preferred unit distributions


(3,952
)


(3,952
)


(7,904
)


(7,904
)Allocation to participating securities


(260
)


(685
)


(521
)


(1,049
)Net income (loss) available to common unitholders

$
17,973


$
74,480


$
(107,308
)

$
114,351Income (loss) available to common unitholders attributable
    to:General partner

$
17,162


$
72,401


$
(105,449
)

$
111,029Limited partners


811



2,079



(1,859
)


3,322Net income (loss) available to common unitholders

$
17,973


$
74,480


$
(107,308
)

$
114,351Basic income (loss) per common unit attributable to AMB
    Property, L.P.Income (loss) from continuing operations (after preferred unit
    distributions)

$
0.02


$
0.69


$
(1.01
)

$
1.03Discontinued operations


0.10



0.05



0.15



0.10Net income (loss) available to common unitholders

$
0.12


$
0.74


$
(0.86
)

$
1.13Diluted income (loss) per common unit attributable to AMB
    Property, L.P.Income (loss) from continuing operations (after preferred unit
    distributions)

$
0.02


$
0.67


$
(1.01
)

$
1.01Discontinued operations


0.10



0.05



0.15



0.10Net income (loss) available to common unitholders

$
0.12


$
0.72


$
(0.86
)

$
1.11WEIGHTED AVERAGE COMMON UNITS OUTSTANDINGBasic


147,495,173



101,055,221



124,168,600



101,407,966Diluted


147,556,616



103,241,224



124,168,600



103,457,171    6




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##### Table of Contents



AMB
    PROPERTY, L.P.CONSOLIDATED STATEMENT OF CAPITAL
    For the Six Months Ended June 30, 2009
 (Unaudited, Dollars in thousands)
  General Partner


Limited PartnersPreferred Units


Common Units


Common Units


NoncontrollingUnits


Amount


Units


Amount


Units


Amount


Interests


TotalBalance as of December 31, 2008


9,300,000


$
223,412



98,240,461


$
2,291,695



2,180,809


$
50,831


$
400,266


$
2,966,204Net (loss) income






7,904







(104,928
)






(1,859
)


4,561Unrealized gain on securities and derivatives














1,952











Currency translation adjustment














(34,498
)










Total comprehensive loss






























(126,868
)Contributions


























6,444



6,444Distributions and allocations






















(1,362
)


(16,611
)


(17,973
)Issuance of common units










47,437,500



552,329















552,329Stock-based compensation amortization and issuance of common
    limited partnership units in connection with the issuance of
    restricted stock and options










388,126



11,949















11,949Issuance of common limited partnership units in connection with
    the exercise of stock options










8,174



130















130Cash redemption of operating partnership units


















(4,000
)


(71
)






(71
)Repurchase of noncontrolling interest














(859
)










(8,909
)


(9,768
)Forfeiture of common limited partnership units in connection
    with the forfeiture of restricted stock










(50,256
)


(789
)














(789
)Reallocation of interests














12,679







(8,042
)


(4,637
)


Distributions






(7,904
)






(81,770
)














(89,674
)Balance as of June 30, 2009


9,300,000


$
223,412



146,024,005


$
2,647,890



2,176,809


$
39,497


$
381,114


$
3,291,913    7




---



##### Table of Contents



AMB
    PROPERTY, L.P.CONSOLIDATED STATEMENTS OF CASH FLOWS
    For the Six Months Ended June 30, 2009 and 2008
  2009


2008(Unaudited, Dollars in thousands)CASH FLOWS FROM OPERATING ACTIVITIESNet (loss) income

$
(94,322
)

$
157,435Adjustments to net (loss) income:Straight-line rents and amortization of lease intangibles


(4,934
)


(6,040
)Depreciation and amortization


80,460



80,214Real estate impairment losses


161,067



Foreign exchange losses (gains)


4,980



(591
)Stock-based compensation amortization


11,949



11,623Equity in earnings of unconsolidated joint ventures


(4,250
)


(8,987
)Operating distributions received from unconsolidated joint
    ventures


2,406



14,159Gains from sale or contribution of real estate interests, net






(19,967
)Development profits, net of taxes


(33,286
)


(48,222
)Debt premiums, discounts and finance cost amortization, net


6,484



4,378Discontinued operations:Depreciation and amortization


2,315



2,351Real estate impairment losses


20,786



Gains from sale of real estate interests, net of taxes


(28,704
)


(2,547
)Changes in assets and liabilities:Accounts receivable and other assets


7,224



(40,884
)Accounts payable and other liabilities


(11,047
)


(15,326
)Net cash provided by operating activities


121,128



127,596CASH FLOWS FROM INVESTING ACTIVITIESChange in restricted cash


(3,629
)


(9,205
)Cash paid for property acquisitions






(148,173
)Additions to land, buildings, development costs, building
    improvements and lease costs


(270,801
)


(539,608
)Net proceeds from divestiture of real estate and securities


278,580



327,516Additions to interests in unconsolidated joint ventures


(4,160
)


(33,483
)Repayment of mortgage and loan receivables






77,504Purchase of noncontrolling interest


(8,968
)


Capital distributions received from unconsolidated joint ventures


5,350



12,622Loans made to affiliates






(73,480
)Purchase of equity interests, net






(10,678
)Net cash provided used in investing activities


(3,628
)


(396,985
)CASH FLOWS FROM FINANCING ACTIVITIESRedemption of partnership units






Issuance of common units, net


552,388



3,484Repurchase and retirement of common units






(87,696
)Borrowings on secured debt


21,688



209,591Payments on secured debt


(50,729
)


(156,598
)Borrowings on other debt






525,000Payments on other debt


(488
)


(101,842
)Borrowings on unsecured credit facilities


407,702



967,750Payments on unsecured credit facilities


(709,065
)


(972,420
)Payment of financing fees


(2,941
)


(7,596
)Net proceeds from issuances of senior debt






325,000Payments on senior debt


(283,205
)


(175,000
)Contributions from joint venture partners


6,444



6,955Distributions paid to partners


(48,629
)


(108,172
)Distributions to noncontrolling interests, including preferred
    units


(10,476
)


(43,931
)Net cash (used in) provided by financing activities


(117,311
)


384,525Net effect of exchange rate changes on cash


(38,219
)


4,395Net (decrease) increase in cash and cash equivalents


(38,030
)


119,531Cash and cash equivalents at beginning of period


223,936



220,224Cash and cash equivalents at end of period

$
185,906


$
339,755SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATIONCash paid for interest, net of capitalized interest

$
64,594


$
70,340Non-cash transactions:Acquisition of properties

$



$
155,045Assumption of other assets and liabilities






(970
)Acquisition capital






(5,902
)Net cash paid for property acquisitions

$



$
148,173Contribution of properties to unconsolidated joint ventures, net

$
8,879


$
5,546    8




---



##### Table of Contents



AMB
    PROPERTY CORPORATION AND AMB PROPERTY, L.P.
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
 June 30, 2009
 (Unaudited)
  1.
    Organization
    and Formation of the Parent Company and the Operating
    Partnership    ® ® and/or and/or
  day-to-day
  co-investment co-investment
   9




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##### Table of Contents



AMB
    PROPERTY CORPORATION AND AMB PROPERTY, L.P.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
          
    on an owned and managed basis, which includes investments held
    on a consolidated basis or through unconsolidated joint
    ventures, the Company owned or partially owned approximately
    131.9 million square feet (principally, warehouse
    distribution buildings) that were 90.5% leased; the Company had
    investments in 34 development projects, which are expected to
    total approximately 9.0 million square feet upon
    completion; and the Company owned 27 projects, totaling
    approximately 8.5 million square feet, which are available
    for sale or contribution;
    through non-managed unconsolidated joint ventures, the Company
    had investments in 46 industrial operating properties, totaling
    approximately 7.4 million square feet; and
    the Company held approximately 0.1 million square feet
    through a ground lease, which is the location of the
    Companys global headquarters.  2.
    Interim
    Financial Statements    Form 10-K
  Use of Estimates.
  Reclassifications.
  Investments in Real Estate.
 10




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##### Table of Contents



AMB
    PROPERTY CORPORATION AND AMB PROPERTY, L.P.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Real Estate Impairment Losses. , Accounting for the
    Impairment or Disposal of Long-lived Assets lease-up
  Derivatives and Hedging Activities. Accounting for Derivative Instruments and
    Hedging Activities
  Comprehensive Income (Loss).
  International Operations.
   11




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##### Table of Contents



AMB
    PROPERTY CORPORATION AND AMB PROPERTY, L.P.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Goodwill and Intangible Assets. Goodwill and Other
    Intangible Assets
  Fair Value of Financial
    Instruments. FAS 107-1 28-1, Interim Disclosures about Fair Value of Financial
    Instruments, Derivatives and Hedging Activities
  New Accounting Pronouncements. Fair Value
    Measurements,
    Level 1.
  Level 2.
  Level 3.
 12




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##### Table of Contents



AMB
    PROPERTY CORPORATION AND AMB PROPERTY, L.P.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Fair
    Value Measurements on a Recurring or Nonrecurring Basis as of
    December 31, 2008
 (Dollars in thousands)
  Level 1


Level 2


Level 3Assets/Liabilities


Assets/Liabilities


Assets/Liabilitiesat Fair Value


at Fair Value


at Fair Value


TotalAssets:Investments in real estate

$



$



$
690,667


$
690,667Deferred compensation plan


16,937











16,937Derivative assets






1,566







1,566Investment securities


7,812











7,812Liabilities:Derivative liabilities

$



$
8,803


$



$
8,803Deferred compensation plan


16,937











16,937   Fair
    Value Measurements on a Recurring or Nonrecurring Basis as of
    June 30, 2009
 (Dollars in thousands)
   Level 1


Level 2


Level 3Assets/Liabilities


Assets/Liabilities


Assets/Liabilitiesat Fair Value


at Fair Value


at Fair Value


TotalAssets:Investments in real estate(1)

$



$



$
656,486


$
656,486Deferred compensation plan


17,103











17,103Derivative assets






4,819







4,819Investment securities(2)


1,535











1,535Liabilities:Derivative liabilities

$



$
5,211


$



$
5,211Deferred compensation plan


17,103











17,103     (1)
    
    Represents certain real estate assets on a consolidated basis,
    that are marked to their fair values at June 30, 2009, as a
    result of real estate impairment losses, net of recoveries in
    value as discussed in Note 2.(2)
    
    The fair value at June 30, 2009 reflects an
    other-than-temporary
    loss on impairment of an investment of $3.7 million
    recognized in the consolidated statements of operations during
    the six months ended June 30, 2009.    Business Combinations
 13




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##### Table of Contents



AMB
    PROPERTY CORPORATION AND AMB PROPERTY, L.P.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Noncontrolling Interests in
    Consolidated Financial Statements  An Amendment of
    ARB No. 51
  Disclosures about Derivative
    Instruments and Hedging Activities  An Amendment of
    FASB Statement No. 133,
  Subsequent Events
  Amendments to FASB Interpretation No. 46(R),
  The
    FASB Accounting Standards Codification and the Hierarchy of
    Generally Accepted Accounting Principles, a replacement of FASB
    Statement No. 162,
  3.
    Impairment
    and Restructuring Charges  ,
    Accounting for the Impairment or Disposal of Long-lived
    Assets
   14




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##### Table of Contents



AMB
    PROPERTY CORPORATION AND AMB PROPERTY, L.P.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
            4.
    Development
    Activity   15




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##### Table of Contents



AMB
    PROPERTY CORPORATION AND AMB PROPERTY, L.P.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   5.
    Development
    Profits, Gains from Sale or Contribution of Real Estate
    Interests and Discontinued Operations  Development Sales and Contributions.
    Gains from Sale or Contribution of Real Estate Interests,
    Net.
  Properties Held for Sale or Contribution,
    Net. development-for-sale
  15-20%. Accounting for the Impairment or Disposal of Long-Lived
    Assets
 16




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##### Table of Contents



AMB
    PROPERTY CORPORATION AND AMB PROPERTY, L.P.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Discontinued Operations. Accounting for the Impairment or Disposal of Long-Lived
    Assets
    For the Three Months


For the Six MonthsEnded June 30,


Ended June 30,2009


2008


2009


2008Rental revenues

$
6,677


$
7,148


$
16,056


$
14,224Straight-line rents and amortization of lease intangibles


428



204



793



72Property operating expenses


(910
)


(1,022
)


(2,224
)


(1,979
)Real estate taxes


(1,026
)


(1,141
)


(2,317
)


(2,040
)Depreciation and amortization


(592
)


(1,162
)


(2,315
)


(2,351
)General and administrative


(64
)


(52
)


(79
)


(80
)Real estate impairment losses










(20,786
)


Other income and expenses, net


(18
)


27



(2
)


89Interest, including amortization


(41
)


6



190



139(Loss) income attributable to discontinued operations before
    noncontrolling interests


4,454



4,008



(10,684
)


8,074Gains from sale of real estate interests, net of taxes, before
    noncontrolling interests


10,090



1,159



28,704



2,547Discontinued operations attributable to the Parent Company and
    the Operating Partnership


14,544



5,167



18,020



10,621 17




---



##### Table of Contents



AMB
    PROPERTY CORPORATION AND AMB PROPERTY, L.P.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  For the Three Months


For the Six MonthsEnded June 30,


Ended June 30,2009


2008


2009


2008Parent Company:Discontinued operations


14,544



5,167



18,020



10,621Noncontrolling interests:Joint venture partners and limited partnership
    unitholders share of loss (income) attributable to
    discontinued operations


(30
)


(425
)


266



(1,088
)Joint venture partners and limited partnership
    unitholders share of gains from sale of real estate
    interests, net of taxes


(3,343
)


(356
)


(3,526
)


(345
)Income from discontinued operations attributable to the Parent
    Company

$
11,171


$
4,386


$
14,760


$
9,188Operating Partnership:Discontinued operations


14,544



5,167



18,020



10,621Noncontrolling interests:Joint venture partners share of loss (income) attributable
    to discontinued operations


94



(280
)


(25
)


(804
)Joint venture partners share of loss from sale of real
    estate interests, net of taxes






324







255Income from discontinued operations attributable to the
    Operating Partnership

$
14,638


$
5,211


$
17,995


$
10,072       June 30,


December 31,2009


2008Cash and cash equivalents

$
2,554


$
Accounts receivable, deferred financing costs and other assets

$
3,869


$
83Secured debt

$
1,956


$
1,923Accounts payable and other liabilities

$
5,527


$
(489
)   6.
    Debt of
    the Parent Company   18




---



##### Table of Contents



AMB
    PROPERTY CORPORATION AND AMB PROPERTY, L.P.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Secured
    Debt Guarantees
    Unsecured
    Senior Debt Guarantees
    Other
    Debt Guarantees
    Unsecured
    Credit Facility Guarantees
       19




---



##### Table of Contents



AMB
    PROPERTY CORPORATION AND AMB PROPERTY, L.P.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
        7.
    Debt of
    the Operating Partnership    June 30,


December 31,2009


2008Wholly-owned secured debt, varying interest rates from 0.8% to
    8.6%, due July 2009 to November 2015 (weighted average interest
    rates of 3.7% and 3.7% at June 30, 2009 and
    December 31, 2008, respectively)

$
604,024


$
715,640Consolidated joint venture secured debt, varying interest rates
    from 1.1% to 9.4%, due July 2009 to November 2022 (weighted
    average interest rates of 5.1% and 4.8% at June 30, 2009
    and December 31, 2008, respectively)


781,482



808,119Unsecured senior debt securities, varying interest rates from
    5.1% to 8.0%, due November 2010 to June 2018 (weighted average
    interest rates of 6.4% and 6.0% at June 30, 2009 and
    December 31, 2008, respectively)


879,286



1,162,491Other debt, varying interest rates from 3.4% to 7.5%, due
    November 2009 to November 2015 (weighted average interest rates
    of 3.9% and 3.9% at June 30, 2009 and December 31,
    2008, respectively)


392,113



392,838Unsecured credit facilities, variable interest rate, due June
    2010 and July 2011 (weighted average interest rates of 0.8% and
    2.2% at June 30, 2009 and December 31, 2008,
    respectively)


594,942



920,850Total debt before unamortized net discounts


3,251,847



3,999,938Unamortized net discounts


(9,561
)


(9,753
)Total consolidated debt

$
3,242,286


$
3,990,185  20




---



##### Table of Contents



AMB
    PROPERTY CORPORATION AND AMB PROPERTY, L.P.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Wholly-owned
    and Consolidated Joint Venture Secured Debt
      Unsecured
    Senior Debt
          Other
    Debt
     21




---



##### Table of Contents



AMB
    PROPERTY CORPORATION AND AMB PROPERTY, L.P.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Unsecured
    Credit Facilities
       22




---



##### Table of Contents



AMB
    PROPERTY CORPORATION AND AMB PROPERTY, L.P.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
         23




---



##### Table of Contents



AMB
    PROPERTY CORPORATION AND AMB PROPERTY, L.P.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
        Wholly-Owned


Consolidated Joint VentureUnsecured











TotalSenior


Credit


Other


Secured


Secured


Other


ConsolidatedDebt


Facilities(1)


Debt


Debt


Debt


Debt


Debt2009

$



$



$
11,865


$
130,845


$
79,644


$



$
222,3542010


75,000



479,482



325,941



419,368



110,917







1,410,7082011


75,000



115,460



1,014



15,036



83,193







289,7032012










1,093



2,683



386,920



50,000



440,6962013


491,795







920



19,416



39,222







551,3532014










616



405



6,481







7,5022015


112,491







664



16,271



17,609







147,0352016


















16,231







16,2312017


















1,272







1,2722018


125,000















1,455







126,455Thereafter


















38,538







38,538Subtotal

$
879,286


$
594,942


$
342,113


$
604,024


$
781,482


$
50,000


$
3,251,847Unamortized net discount


(7,917
)










(1,460
)


(184
)






(9,561
)Total

$
871,369


$
594,942


$
342,113


$
602,564


$
781,298


$
50,000


$
3,242,286     (1)
    
    Represents three credit facilities with total capacity of
    approximately $1.6 billion. Includes $165.0 million of
    U.S. dollar borrowings, as well as $273.5 million,
    $87.7 million, $41.0 million and $27.7 million in
    Yen, 24




---



##### Table of Contents



AMB
    PROPERTY CORPORATION AND AMB PROPERTY, L.P.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Canadian dollar, Euro and Singapore dollar-based borrowings
    outstanding at June 30, 2009, respectively, translated to
    U.S. dollars using the foreign exchange rates in effect on
    June 30, 2009.  8.
    Noncontrolling
    Interests in the Parent Company      Total InvestmentCompanys


in Real Estate


Property Debt


Other DebtCo-investment

Ownership


June 30,


December 31,


June 30,


December 31,


June 30,


December 31,Consolidated Joint Ventures

Venture Partner

Percentage


2009


2008


2009


2008


2009


2008Co-investment VenturesAMB-SGP, L.P.

Industrial JV Pte. Ltd.(2)


50
%

$
464,954


$
461,981


$
339,335


$
341,855


$



$
AMB Institutional Alliance Fund II, L.P.

AMB Institutional Alliance REIT II, Inc. (3)


20
%


510,502



538,906



197,559



232,856



50,000



50,000AMB-AMS,
    L.P.(1)

PMT, SPW and TNO(4)


39
%


157,522



157,034



82,473



83,337







Other Industrial Operating Joint Ventures




89
%


241,522



212,472



33,237



21,544







Other Industrial Development Joint Ventures




61
%


249,872



299,687



128,694



128,501







Total Consolidated Joint Ventures







$
1,624,372


$
1,670,080


$
781,298


$
808,093


$
50,000


$
50,000     (1)
    
    AMB-AMS,
    L.P. is a co-investment partnership with three Dutch pension
    funds.(2)
    
    A subsidiary of GIC Real Estate Pte. Ltd., the real estate
    investment subsidiary of the Government of Singapore Investment
    Corporation.(3)
    
    Comprised of 14 institutional investors as stockholders and one
    third-party limited partner as of June 30, 2009.(4)
    
    PMT is Stichting Pensioenfonds Metaal en Techniek, SPW is
    Stichting Pensioenfonds voor de Woningcorporaties and TNO is
    Stichting Pensioenfonds TNO.    Balance as of December 31, 2007

$
697,411Net income


37,484Contributions


6,504Distributions and allocations


(53,983
)Redemption of partnership units


(450
)Purchase of noncontrolling interest


15,067Reallocation of partnership interest


8,449Balance as of June 30, 2008

$
710,482  25




---



##### Table of Contents



AMB
    PROPERTY CORPORATION AND AMB PROPERTY, L.P.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    June 30,


December 31,


Redemption/Callable2009


2008


DateJoint venture partners

$
280,714


$
293,367


N/ALimited partners in the Operating Partnership


39,497



50,831


N/AHeld through AMB Property II, L.P.:Class B limited partners


22,839



29,338


N/ASeries D preferred units (liquidation preference of $79,767)


77,561



77,561


February 2012Total noncontrolling interests

$
420,611


$
451,097     For the Three Months


For the Six MonthsEnded June 30,


Ended June 30,2009


2008


2009


2008Joint venture partners share of net income

$
4,949


$
6,424


$
2,771


$
25,687Joint venture partners and common limited partners
    shareof development profits






1,371



702



6,113Common limited partners in the Operating Partnerships
    share of net income (loss)


811



1,219



(2,561
)


1,927Held through AMB Property II, L.P.:Class B common limited partnership units share of
    development profits










406



Class B common limited partnership units share of net
    income (loss)


468



565



(1,480
)


893Series D preferred units (liquidation preference of $79,767)


1,432



1,432



2,864



2,864Total noncontrolling interests share of net income

$
7,660


$
11,011


$
2,702


$
37,484   9.
    Noncontrolling
    Interests in the Operating Partnership    Consolidation of
    Variable Interest Entities  An Interpretation of ARB
    No. 51 No. 04-5, Determining Whether a General Partner, or the General
    Partners as a Group, Controls a Limited Partnership or Similar
    Entity When the Limited Partners Have Certain Rights (EITF 04-5), Accounting for Investments in Real Estate Ventures
    ( SOP 78-9) .
 26




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##### Table of Contents



AMB
    PROPERTY CORPORATION AND AMB PROPERTY, L.P.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  EITF 04-5, SOP 78-9,
    Total InvestmentCompanys


in Real Estate


Property Debt


Other DebtCo-investment

Ownership


June 30,


December 31,


June 30,


December 31,


June 30,


December 31,Consolidated Joint Ventures

Venture Partner

Percentage


2009


2008


2009


2008


2009


2008Co-investment Ventures AMB-SGP, L.P.

Industrial JV Pte. Ltd.(2)


50
%

$
464,954


$
461,981


$
339,335


$
341,855


$



$
AMB Institutional Alliance Fund II, L.P.

AMB Institutional Alliance REIT II, Inc. (3)


20
%


510,502



538,906



197,559



232,856



50,000



50,000AMB-AMS,
    L.P.(1)

PMT, SPW and TNO(4)


39
%


157,522



157,034



82,473



83,337







Other Industrial Operating Joint Ventures




89
%


241,522



212,472



33,237



21,544







Other Industrial Development Joint Ventures




61
%


249,872



299,687



128,694



128,501







Total Consolidated Joint Ventures







$
1,624,372


$
1,670,080


$
781,298


$
808,093


$
50,000


$
50,000     (1)
    
    AMB-AMS,
    L.P. is a co-investment partnership with three Dutch pension
    funds.(2)
    
    A subsidiary of GIC Real Estate Pte. Ltd., the real estate
    investment subsidiary of the Government of Singapore Investment
    Corporation.(3)
    
    Comprised of 14 institutional investors as stockholders and one
    third-party limited partner as of June 30, 2009.(4)
    
    PMT is Stichting Pensioenfonds Metaal en Techniek, SPW is
    Stichting Pensioenfonds voor de Woningcorporaties and TNO is
    Stichting Pensioenfonds TNO.    Balance as of December 31, 2007

$
627,377Net income


34,394Contributions


6,504Distributions and allocations


(44,345
)Purchase of noncontrolling interest


15,067Reallocation of partnership interest


2,679Balance as of June 30, 2008

$
641,676  27




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##### Table of Contents



AMB
    PROPERTY CORPORATION AND AMB PROPERTY, L.P.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    June 30,


December 31,


Redemption/Callable2009


2008


DateJoint venture partners

$
280,714


$
293,367


N/AHeld through AMB Property II, L.P.:Class B limited partners


22,839



29,338


N/ASeries D preferred units (liquidation preference of $79,767)


77,561



77,561


February 2012Total noncontrolling interests

$
381,114


$
400,266     For the Three Months


For the Six MonthsEnded June 30,


Ended June 30,2009


2008


2009


2008Joint venture partners share of net income

$
4,949


$
6,424


$
2,771


$
25,687Joint venture partners share of development profits






196







4,409Held through AMB Property II, L.P.:Class B common limited partnership units share of
    development profits










406



Class B common limited partnership units


468



565



(1,480
)


893Series D preferred units (liquidation preference of $79,767)


1,432



1,432



2,864



2,864Total noncontrolling interests share of net income

$
6,849


$
8,617


$
4,561


$
33,853     10.
    Investments
    in Unconsolidated Joint Ventures   28




---



##### Table of Contents



AMB
    PROPERTY CORPORATION AND AMB PROPERTY, L.P.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
      development-for-sale
     29




---



##### Table of Contents



AMB
    PROPERTY CORPORATION AND AMB PROPERTY, L.P.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
             30




---



##### Table of Contents



AMB
    PROPERTY CORPORATION AND AMB PROPERTY, L.P.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    June 30, 2009CompanysOwnership


Square


June 30,


December 31,Unconsolidated Joint Ventures

Percentage


Feet


2009


2008Co-investment VenturesAMB Institutional Alliance Fund III, L.P.


19
%


36,572,045


$
186,497


$
185,430AMB Europe Fund I, FCP-FIS


21
%


9,236,263



61,943



65,563AMB Japan Fund I, L.P.


20
%


7,263,082



79,008



65,705AMB-SGP Mexico, LLC


22
%


6,331,990



19,757



19,519AMB DFS Fund I, LLC


15
%


1,235,492



17,464



20,663Other Industrial Operating Joint Ventures(1)


51
%


7,418,749



50,049



49,791Total Unconsolidated Joint Ventures






68,057,621


$
414,718


$
406,671     (1)
    
    Other Industrial Operating Joint Ventures includes joint
    ventures between the Company and third parties which generally
    have been formed to take advantage of a particular market
    opportunity that can be accessed as a result of the joint
    venture partners experience in the market. The Company
    typically owns
    40-60% of
    these joint ventures.      For the Three Months


For the Three MonthsEnded June 30, 2009


Ended June 30, 2008Income











Income(Loss)











(Loss)Property


from


Net





Property


from


NetOperating


Continuing


Income





Operating


Continuing


IncomeUnconsolidated Joint Ventures:

Revenues


Expenses


Operations


(Loss)


Revenues


Expenses


Operations


(Loss)Co-investment VenturesAMB Institutional Alliance Fund III, L.P.

$
69,204


$
(18,102
)

$
3,317


$
4,343


$
47,061


$
(12,035
)

$
2,649


$
2,649AMB Europe Fund I, FCP-FIS


24,179



(4,988
)


1,188



1,188



26,778



(4,249
)


2,950



2,950AMB Japan Fund I, L.P.


23,950



(5,768
)


3,635



3,635



17,732



(4,098
)


1,089



1,089AMB-SGP Mexico, LLC


9,819



(1,317
)


739
(1)


739
(1)


7,166



(959
)


(2,720
)(1)


(2,720
)(1)AMB DFS Fund I, LLC






(118
)


(5,370
)


(5,370
)


104



(4
)


452



452Total Co-investment Ventures


127,152



(30,293
)


3,509



4,535



98,841



(21,345
)


4,420



4,420Other Industrial Operating Joint Ventures


9,314



(2,333
)


2,296



2,296



9,755



(2,256
)


3,763



3,763Total Unconsolidated Joint Ventures

$
136,466


$
(32,626
)

$
5,805


$
6,831


$
108,596


$
(23,601
)

$
8,183


$
8,183   31




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##### Table of Contents



AMB
    PROPERTY CORPORATION AND AMB PROPERTY, L.P.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  For the Six Months


For the Six MonthsEnded June 30, 2009


Ended June 30, 2008Income











Income(Loss)











(Loss)Property


from


Net





Property


from


NetOperating


Continuing


Income





Operating


Continuing


IncomeUnconsolidated Joint Ventures:

Revenues


Expenses


Operations


(Loss)


Revenues


Expenses


Operations


(Loss)Co-investment VenturesAMB Institutional Alliance Fund III, L.P.

$
141,339


$
(38,743
)

$
2,992


$
(3,798
)

$
91,143


$
(23,688
)

$
6,235


$
6,235AMB Europe Fund I, FCP-FIS


47,112



(9,735
)


(9,049
)


(9,049
)


48,565



(8,378
)


1,538



1,538AMB Japan Fund I, L.P.


49,693



(11,142
)


8,465



8,465



35,165



(7,481
)


3,210



3,210AMB-SGP Mexico, LLC


19,280



(2,608
)


1,435
(2)


1,435
(2)


14,514



(2,284
)


(3,874
)(2)


(3,874
)(2)AMB DFS Fund I, LLC


50



31



(2,067
)


(2,067
)


104



(13
)


7,274



7,274Total Co-investment Ventures


257,474



(62,197
)


1,776



(5,014
)


189,491



(41,844
)


14,383



14,383Other Industrial Operating Joint Ventures


18,432



(4,446
)


4,956



4,956



19,288



(4,262
)


7,203



7,203Total Unconsolidated Joint Ventures

$
275,906


$
(66,643
)

$
6,732


$
(58
)

$
208,779


$
(46,106
)

$
21,586


$
21,586     (1)
    
    Excludes $3.8 million and $3.0 million of interest
    expense on loans from co-investment venture partners for the
    three months ended June 30, 2009 and 2008, respectively.(2)
    
    Excludes $7.6 million and $6.0 million of interest
    expense on loans from co-investment venture partners for the six
    months ended June 30, 2009 and 2008, respectively.  11.
    Stockholders
    Equity of the Parent Company  one-for-one
   32




---



##### Table of Contents



AMB
    PROPERTY CORPORATION AND AMB PROPERTY, L.P.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Balance as of December 31, 2007

$
2,763,952Net income


119,951Unrealized loss on securities


(2,330
)Unrealized gain on derivatives


2,902Foreign currency translation adjustments


19,000Total comprehensive income


139,523Stock-based compensation amortization and issuance of restricted
    stock, net


11,623Exercise of stock options


3,484Conversion of partnership units


1,191Repurchases of common stock


(87,696
)Forfeiture of restricted stock


(1,450
)Reallocation of partnership interest


(8,449
)Offering costs


(10
)Dividends


(109,573
)Balance as of June 30, 2008

$
2,712,595     For the Three Months


For the Six MonthsEnded June 30,


Ended June 30,Paying Entity

Security

2009


2008


2009


2008AMB Property Corporation

Common stock

$
0.280


$
0.520


$
0.560


$
1.040AMB Property Corporation

Series L preferred stock

$
0.406


$
0.406


$
0.813


$
0.813AMB Property Corporation

Series M preferred stock

$
0.422


$
0.422


$
0.844


$
0.844AMB Property Corporation

Series O preferred stock

$
0.438


$
0.438


$
0.875


$
0.875AMB Property Corporation

Series P preferred stock

$
0.428


$
0.428


$
0.856


$
0.856        33




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##### Table of Contents



AMB
    PROPERTY CORPORATION AND AMB PROPERTY, L.P.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Dividend Yield


Expected Volatility


Risk-free Interest Rate


Weighted Average


Weighted AverageWeighted




Weighted




Weighted


Expected Life


Grant DateFor the Quarter Ended

Range

Average


Range

Average


Range

Average


(Years)


Fair ValueMarch 31, 2009

6.1% - 7.0%


7.0
%

40.1% - 42.2%


42.1
%

1.4% - 2.4%


2.0
%


6.1


$
3.19June 30, 2009

6.0% - 6.3%


6.3
%

46.3% - 47.0%


47.0
%

1.9% - 2.9%


2.8
%


7.8


$
4.56Weighted Average

6.0% - 7.0%


7.0
%

40.1% - 47.0%


42.4
%

1.4% - 2.9%


2.0
%


6.2


$
3.26     12.
    Partners
    Capital of the Operating Partnership  one-for-one
  1 2 3 4
 34




---



##### Table of Contents



AMB
    PROPERTY CORPORATION AND AMB PROPERTY, L.P.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Balance as of December 31, 2007

$
2,833,986Net income


123,304Unrealized loss on securities


(2,330
)Unrealized gain on derivatives


2,902Foreign currency translation adjustments


19,000Total comprehensive income


142,876Stock-based compensation amortization and issuance of
    partnership unitsin connection with the issuance of restricted stock, net


11,623Issuance of partnership units in connection with the exercise of
    stock options


3,484Conversion of partnership units


741Repurchases of common units


(87,696
)Forfeiture of partnership units in connection with the
    forfeiture of restricted stock


(1,450
)Reallocation of partnership interest


(8,448
)Offering costs


(10
)Distributions


(113,705
)Balance at June 30, 2008

$
2,781,401     For the Three Months


For the Six MonthsEnded June 30,


Ended June 30,Paying Entity

Security

2009


2008


2009


2008AMB Property, L.P.

Common limited partnership units

$
0.280


$
0.520


$
0.560


$
1.040AMB Property, L.P.

Series L preferred units

$
0.406


$
0.406


$
0.813


$
0.813AMB Property, L.P.

Series M preferred units

$
0.422


$
0.422


$
0.844


$
0.844AMB Property, L.P.

Series O preferred units

$
0.438


$
0.438


$
0.875


$
0.875AMB Property, L.P.

Series P preferred units

$
0.428


$
0.428


$
0.856


$
0.856AMB Property II, L.P.

Class B common limited partnership units

$
0.280


$
0.520


$
0.560


$
1.040AMB Property II, L.P.

Series D preferred units

$
0.898


$
0.898


$
1.795


$
1.795      35




---



##### Table of Contents



AMB
    PROPERTY CORPORATION AND AMB PROPERTY, L.P.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
      Dividend Yield


Expected Volatility


Risk-free Interest Rate


Weighted Average


Weighted AverageWeighted




Weighted




Weighted


Expected Life


Grant DateFor the Quarter Ended

Range

Average


Range

Average


Range

Average


(Years)


Fair ValueMarch 31, 2009

6.1% - 7.0%


7.0
%

40.1% - 42.2%


42.1
%

1.4% - 2.4%


2.0
%


6.1


$
3.19June 30, 2009

6.0% - 6.3%


6.3
%

46.3% - 47.0%


47.0
%

1.9% - 2.9%


2.8
%


7.8


$
4.56Weighted Average

6.0% - 7.0%


7.0
%

40.1% - 47.0%


42.4
%

1.4% - 2.9%


2.0
%


6.2


$
3.26     13.
    Income
    (Loss) Per Share and Unit  No. EITF 03-6-1, Determining Whether Instruments Granted in Share-Based
    Payment Transactions are Participating Securities Earnings per
    Share No. EITF 03-6-1
 36




---



##### Table of Contents



AMB
    PROPERTY CORPORATION AND AMB PROPERTY, L.P.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    For the Three Months


For the Six MonthsEnded June 30,


Ended June 30,2009


2008


2009


2008NumeratorIncome (loss) from continuing operations attributable to common
    stockholders

$
10,203


$
72,633


$
(111,784
)

$
110,763Preferred stock dividends


(3,952
)


(3,952
)


(7,904
)


(7,904
)Income (loss) from continuing operations (after noncontrolling
    interests share of (income) loss from continuing
    operations and preferred stock dividends)


6,251



68,681



(119,688
)


102,859Total discontinued operations attributable to common
    stockholders after noncontrolling interests


11,171



4,386



14,760



9,188Allocation to participating securities


(260
)


(666
)


(521
)


(1,018
)Net income (loss) available to common stockholders

$
17,162


$
72,401


$
(105,449
)

$
111,029DenominatorBasic


145,318,364



97,083,044



121,991,039



97,433,162Stock option dilution(1)


61,443



2,186,003







2,049,205Diluted weighted average common shares


145,379,807



99,269,047



121,991,039



99,482,367Basic income (loss) per common share attributable to AMB
    Property CorporationIncome (loss) from continuing operations

$
0.04


$
0.71


$
(0.98
)

$
1.05Discontinued operations


0.08



0.04



0.12



0.09Net income (loss) available to common stockholders(2)

$
0.12


$
0.75


$
(0.86
)

$
1.14Diluted income (loss) per common share attributable to AMB
    Property CorporationIncome (loss) from continuing operations

$
0.04


$
0.69


$
(0.98
)

$
1.03Discontinued operations


0.08



0.04



0.12



0.09Net income (loss) available to common stockholders(2)

$
0.12


$
0.73


$
(0.86
)

$
1.12  37




---



##### Table of Contents



AMB
    PROPERTY CORPORATION AND AMB PROPERTY, L.P.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    (1)
    
    Excludes anti-dilutive stock options of 7,764,478 and 7,443,578
    for the three and six months ended June 30, 2009,
    respectively. Excludes anti-dilutive stock options of 1,174,981
    and 1,489,631 for the three and six months ended June 30,
    2008, respectively. These weighted average shares relate to
    anti-dilutive stock options, which are calculated using the
    treasury stock method, and could be dilutive in the future.(2)
    
    In accordance with FSP No. EITF
    03-6-1 and
    SFAS No. 128, the net income (loss) available to
    common stockholders is adjusted for earnings distributed through
    declared dividends and allocated to all participating securities
    (weighted average common shares outstanding and unvested
    restricted stock outstanding) under the two-class method. Under
    this method, allocations were made to 930,321 unvested
    restricted shares outstanding for both the three and six months
    ended June 30, 2009, and 893,381 unvested restricted shares
    outstanding for both the three and six months ended
    June 30, 2008.  one-for-one
  For the Three Months


For the Six MonthsEnded June 30,


Ended June 30,2009


2008


2009


2008NumeratorIncome (loss) from continuing operations attributable to common
    unitholders

$
7,547


$
74,202


$
(116,878
)

$
113,510Preferred unit distributions


(3,952
)


(3,952
)


(7,904
)


(7,904
)Income (loss) from continuing operations (after noncontrolling
    interests share of (income) loss from continuing
    operations and preferred unit distributions)


3,595



70,250



(124,782
)


105,606Total discontinued operations attributable to common unitholders
    after noncontrolling interests


14,638



5,211



17,995



10,072Allocation to participating securities


(260
)


(688
)


(521
)


(1,051
)Net income (loss) available to common unitholders

$
17,973


$
74,773


$
(107,308
)

$
114,627 38




---



##### Table of Contents



AMB
    PROPERTY CORPORATION AND AMB PROPERTY, L.P.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  For the Three Months


For the Six MonthsEnded June 30,


Ended June 30,2009


2008


2009


2008DenominatorBasic


147,495,173



101,055,221



124,168,600



101,407,966Stock option dilution(1)


61,443



2,186,003







2,049,205Diluted weighted average common units


147,556,616



103,241,224



124,168,600



103,457,171Basic income (loss) per common unit attributable to AMB
    Property, L.P.Income (loss) from continuing operations

$
0.02


$
0.69


$
(1.01
)

$
1.03Discontinued operations


0.10



0.05



0.15



0.10Net income (loss) available to common unitholders(2)

$
0.12


$
0.74


$
(0.86
)

$
1.13Diluted (loss) income per common unit attributable to AMB
    Property, L.P.Income (loss) from continuing operations

$
0.02


$
0.67


$
(1.01
)

$
1.01Discontinued operations


0.10



0.05



0.15



0.10Net income (loss) available to common unitholders(2)

$
0.12


$
0.72


$
(0.86
)

$
1.11     (1)
    
    Excludes anti-dilutive stock options of 7,764,478 and 7,443,578
    for the three and six months ended June 30, 2009,
    respectively. Excludes anti-dilutive stock options of 1,174,981
    and 1,489,631 for the three and six months ended June 30,
    2008, respectively. These weighted average shares relate to
    anti-dilutive stock options, which are calculated using the
    treasury stock method, and could be dilutive in the future.(2)
    
    In accordance with FSP No. EITF
    03-6-1 and
    SFAS No. 128, the net income (loss) available to
    common unitholders is adjusted for earnings distributed through
    declared distributions and allocated to all participating
    securities (weighted average common units outstanding and
    unvested restricted stock outstanding) under the two-class
    method. Under this method, allocations were made to 930,321
    unvested restricted shares outstanding for both the three and
    six months ended June 30, 2009, and 893,381 unvested
    restricted shares outstanding for both the three and six months
    ended June 30, 2008.  14.
    Segment
    Information    
    Real Estate Operations.  The Company operates
    industrial properties and manages its business by geographic
    markets. Such industrial properties are typically comprised of
    multiple distribution warehouse facilities suitable for single
    or multiple customers who are engaged in various types of
    businesses. The geographic markets where the Company owns
    industrial properties are managed separately because it believes
    each market has its own economic characteristics and requires
    its own operating, pricing and leasing strategies. Each market
    is considered to be an individual operating segment. The
    accounting policies of the segments are the same as those
    described in the summary of significant accounting policies. The
    Company 39




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##### Table of Contents



AMB
    PROPERTY CORPORATION AND AMB PROPERTY, L.P.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  evaluates performance based upon property net operating income
    of the combined properties in each segment, which are listed
    below. In addition, the Companys development business is
    included under real estate operations. It primarily consists of
    the Companys development of real estate properties that
    are subsequently contributed to a co-investment venture fund in
    which the Company has an ownership interest and for which the
    Company acts as manager, or that are sold to third parties. The
    Company evaluates performance of the development business by
    reported operating segment based upon gains generated from the
    disposition
    and/or
    contribution of real estate. The assets of the development
    business generally include properties under development and land
    held for development. During the period between the completion
    of development of a property and the date the property is
    contributed to an unconsolidated co-investment venture or sold
    to a third party, the property and its associated rental income
    and property operating costs are included in the real estate
    operations segment because the primary activity associated with
    the property during that period is leasing. Upon contribution or
    sale, the resulting gain or loss is included as gains from sale
    or contribution of real estate interests or development profits,
    as appropriate.  
    Private Capital.  The Company, through its
    private capital group, AMB Capital Partners, LLC (AMB
    Capital Partners), provides real estate investment,
    portfolio management and reporting services to co-investment
    ventures and clients. The private capital income earned consists
    of acquisition and development fees, asset management fees and
    priority distributions, and promote interests and incentive
    distributions from the Companys co-investment ventures and
    AMB Capital Partners clients. With respect to the
    Companys U.S. and Mexico funds and co-investment
    ventures, the Company typically earns a 90.0 basis points
    acquisition fee on the acquisition cost of third party
    acquisitions, asset management priority distributions of 7.5% of
    net operating income on stabilized properties, 70.0 basis
    points of total projected costs as asset management fees on
    renovation or development properties, and incentive
    distributions of 15% of the return over a 9% internal rate of
    return and 20% of the return over a 12% internal rate of return
    to investors on a periodic basis or at the end of a funds
    life. In Japan, the Company earns a 90.0 basis points
    acquisition fee on the acquisition cost of third-party
    acquisitions, asset management priority distributions of 1.5% of
    unreturned equity, and incentive distributions of 20% of the
    return over a 10% internal rate of return and 25% of the return
    over a 13% internal rate of return to investors at the end of a
    funds life. In Europe, the Company earns a 90.0 basis
    points acquisition fee on the acquisition cost of third-party
    acquisitions, asset management fees of 75.0 basis points on
    the gross asset value of the fund, and incentive distributions
    of 20% of the return over a 9% internal rate of return and 25%
    of the return over a 12% internal rate of return to investors on
    a periodic basis. The accounting policies of the segment are the
    same as those described in the summary of significant accounting
    policies under Note 2, Notes to the Consolidated Financial
    Statements in the Annual Reports on
    Form 10-K
    for the Parent Company and the Operating Partnership for the
    year ended December 31, 2008. 40




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##### Table of Contents



AMB
    PROPERTY CORPORATION AND AMB PROPERTY, L.P.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
     Revenues


Property NOI(2)


Development GainsFor the Three Months


For the Three Months


For the Three MonthsEnded June 30,


Ended June 30,


Ended June 30,Segments(1)

2009


2008


2009


2008


2009


2008U.S. MarketsSouthern California

$
22,858


$
27,398


$
18,099


$
21,466


$



$
507No. New Jersey / New York


15,267



16,997



10,198



11,930







San Francisco Bay Area


20,710



21,502



14,585



15,642







Chicago


9,942



13,776



6,773



8,890







70On-Tarmac


13,131



13,197



7,236



7,282







South Florida


10,277



9,993



6,796



6,624







6,213Seattle


5,380



9,772



4,417



7,829







Non  U.S. MarketsEurope


3,763



1,541



2,061



1,265







Japan


5,367



8,058



3,181



6,003







13,135Other Markets


38,443



43,537



27,343



30,468







10,477Total markets


145,138



165,771



100,689



117,399







30,402Straight-line rents and amortization of lease intangibles


1,542



2,708



1,542



2,708







Discontinued operations


(7,105
)


(7,352
)


(5,169
)


(5,189
)






Private capital income


7,795



41,413















Total

$
147,370


$
202,540


$
97,062


$
114,918


$



$
30,402   Revenues


Property NOI(2)


Development GainsFor the Six Months


For the Six Months


For the Six MonthsEnded June 30,


Ended June 30,


Ended June 30,Segments(1)

2009


2008


2009


2008


2009


2008U.S. MarketsSouthern California

$
47,627


$
54,870


$
37,830


$
43,251


$
838


$
1,107No. New Jersey / New York


31,376



35,881



20,359



25,328







San Francisco Bay Area


43,476



43,160



31,196



31,768







Chicago


21,329



28,944



13,617



18,604







2,964On-Tarmac


26,487



26,352



14,263



14,663







South Florida


20,296



20,233



13,384



13,742







7,038Seattle


11,593



19,893



9,359



15,987



3,044



7,236Non  U.S. MarketsEurope


6,512



2,235



3,493



1,729







5,449Japan


10,899



13,073



6,453



9,963



28,588



13,316Other Markets


82,180



84,938



56,075



59,833



816



11,112Total markets


301,775



329,579



206,029



234,868



33,286



48,222Straight-line rents and amortization of lease intangibles


4,934



6,040



4,934



6,040







Discontinued operations


(16,849
)


(14,296
)


(12,308
)


(10,277
)






Private capital income


19,490



51,336















Total

$
309,350


$
372,659


$
198,655


$
230,631


$
33,286


$
48,222  41




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##### Table of Contents



AMB
    PROPERTY CORPORATION AND AMB PROPERTY, L.P.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    (1)
    
    The markets included in U.S. markets are a subset of the
    Companys regions defined as East, West and Central in the
    Americas. Japan is a part of the Companys Asia region.(2)
    
    Property net operating income (NOI) is defined as
    rental revenues, including reimbursements, less property
    operating expenses. NOI excludes depreciation, amortization,
    general and administrative expenses, restructuring charges, real
    estate impairment losses, development profits (losses), gains
    (losses) from sale or contribution of real estate interests, and
    interest expense. The Company believes that net income, as
    defined by GAAP, is the most appropriate earnings measure.
    However, NOI is a useful supplemental measure calculated to help
    investors understand the Companys operating performance,
    excluding the effects of costs and expenses which are not
    related to the performance of the assets. NOI is widely used by
    the real estate industry as a useful supplemental measure, which
    helps investors compare the Companys operating performance
    with that of other companies. Real estate impairment losses have
    been excluded in deriving NOI because the Company does not
    consider its impairment losses to be a property operating
    expense. The Company believes that the exclusion of impairment
    losses from NOI is a common methodology used in the real estate
    industry. Real estate impairment losses relate to the changing
    values of the Companys assets but do not reflect the
    current operating performance of the assets with respect to
    their revenues or expenses. The Companys real estate
    impairment losses are non-cash charges which represent the write
    down in the value of assets when estimated fair value over the
    holding period is lower than current carrying value. The
    impairment charges were principally a result of increases in
    estimated capitalization rates and deterioration in market
    conditions that adversely impacted underlying real estate
    values. Therefore, the impairment charges are not related to the
    current performance of the Companys real estate operations
    and should be excluded from its calculation of NOI.   42




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AMB
    PROPERTY CORPORATION AND AMB PROPERTY, L.P.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    For the Three Months


For the Six MonthsEnded June 30,


Ended June 30,2009


2008


2009


2008Property NOI

$
97,062


$
114,918


$
198,655


$
230,631Private capital revenues


7,795



41,413



19,490



51,336Depreciation and amortization


(38,724
)


(39,730
)


(80,460
)


(80,214
)General and administrative


(25,363
)


(33,744
)


(56,609
)


(68,869
)Restructuring charges


(3,824
)






(3,824
)


Fund costs


(322
)


(384
)


(584
)


(606
)Real estate impairment losses










(161,067
)


Other expenses


(5,684
)


(1,422
)


(5,022
)


(1,330
)Development profits, net of taxes






30,402



33,286



48,222Gains from sale or contribution of real estate interests, net of
    taxes














19,967Equity in earnings of unconsolidated joint ventures, net


4,284



6,059



4,250



8,987Other income


8,595



1,883



1,529



6,293Interest expense, including amortization


(29,329
)


(36,532
)


(61,986
)


(67,603
)Total discontinued operations


14,544



5,167



18,020



10,621Net (loss) income

$
29,034


$
88,030


$
(94,322
)

$
157,435     Total Assets as ofJune 30,


December 31,2009


2008U.S. MarketsSouthern California

$
718,439


$
776,819No. New Jersey / New York


544,825



524,883San Francisco Bay Area


736,867



783,345Chicago


306,445



319,043On-Tarmac


179,554



185,877South Florida


412,716



411,408Seattle


143,583



195,822Non  U.S. MarketsEurope


546,229



484,866Japan


627,977



860,982Other Markets


2,005,747



2,050,431Total markets


6,222,382



6,593,476Investments in unconsolidated joint ventures


434,008



431,322Non-segment assets


228,858



276,850Total assets

$
6,885,248


$
7,301,648  43




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##### Table of Contents



AMB
    PROPERTY CORPORATION AND AMB PROPERTY, L.P.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Real Estate Impairment Losses


Restructuring ChargesFor the Three Months


For the Six Months


For the Three Months


For the Six MonthsEnded June 30, 2009


Ended June 30, 2009


Ended June 30, 2009


Ended June 30, 2009U.S. MarketsSouthern California

$



$
16,809


$
71


$
71No. New Jersey / New York






9,056







San Francisco Bay Area






4,275



1,637



1,637Chicago






1,330



36



36On-Tarmac














South Florida






5,531







Seattle














Non  U.S. MarketsEurope






30,393



378



378Japan






13,469



310



310Other Markets






100,990



1,392



1,392Total markets

$



$
181,853


$
3,824


$
3,824   15.
    Commitments
    and Contingencies  Commitments
  Lease Commitments.
  Standby Letters of Credit.
  Guarantees and Contribution
    Obligations.
    co-investment
 44




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##### Table of Contents



AMB
    PROPERTY CORPORATION AND AMB PROPERTY, L.P.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    364-day and/or 5-year
  Performance and Surety Bonds.
  Promote Interests and Other Contractual
    Obligations.
  Contingencies
  Litigation.
 45




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##### Table of Contents



AMB
    PROPERTY CORPORATION AND AMB PROPERTY, L.P.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Environmental Matters.
  General Uninsured Losses.
  Captive Insurance Company.
  16.
    Derivatives
    and Hedging Activities  Risk
    Management Objective of Using Derivatives
     46




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##### Table of Contents



AMB
    PROPERTY CORPORATION AND AMB PROPERTY, L.P.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Cash Flow
    Hedges of Interest Rate Risk
          Number of


NotionalRelated Derivatives

Instruments


Amount(in thousands)Interest rate swaps


3


$
555,000   Non-designated
    Hedges
      Number of


NotionalRelated Derivatives

Instruments


Amount(in thousands)Foreign exchange forward contracts


3


$
646,786Interest rate caps


1


$
7,319  47




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##### Table of Contents



AMB
    PROPERTY CORPORATION AND AMB PROPERTY, L.P.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Fair Value of Derivative Instruments at June 30, 2009Asset Derivatives


Liability DerivativesBalance Sheet


Fair


Balance Sheet


FairLocation


Value


Location


Value(in thousands)





(in thousands)Derivatives designated as hedging instrumentsunder SFAS No. 133Interest rate swaps





$




Other assets
    (contra asset
)

$
5,211Derivatives not designated as hedging instruments under
    SFAS No. 133Foreign exchange forward contracts


Other assets


$
4,816






$
Interest rate caps


Other assets



3







Total





$
4,819






$
Total derivative instruments





$
4,819






$
5,211     Gain (Loss) Recognized





Gain (Loss)Derivative Instruments in

in Accumulated Other


Location of Gain


ReclassifiedSFAS No. 133 Cash Flow

Comprehensive (Loss)


(Loss) Reclassified


from AccumulatedHedging Relationships

Income (OCI)


from Accumulated OCI into


OCI into Income(in thousands)

(Effective Portion)


Income (Effective Portion)


(Effective Portion)For the three months ended June 30, 2009:Interest rate swaps

$
1,468



Interest expense


$
(2,572
)For the six months ended June 30, 2009:Interest rate swaps

$
1,773



Interest expense


$
(4,566
)   Derivative Instruments Not

Location of Gain (Loss)Designated as Hedging

Recognized in Statement

Amount of Gain (Loss)Instruments under SFAS No. 133

of Operations

Recognized(in thousands)For the three months ended June 30, 2009:Foreign exchange forward contracts

Other (expenses) income

$
2,377Interest rate caps

Other (expenses) income


3Total



$
2,380For the six months ended June 30, 2009:Foreign exchange forward contracts

Other (expenses) income

$
(789
)Interest rate caps

Other (expenses) income


3Total



$
(786
)  48




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##### Table of Contents



AMB
    PROPERTY CORPORATION AND AMB PROPERTY, L.P.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Credit-risk-related
    Contingent Features
  over-the-counter
    16.
    Subsequent
    Events     49




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##### Table of Contents



Item 2.
    Managements
    Discussion and Analysis of Financial Condition and Results of
    Operations  Some of the information included in this quarterly report on
    Form 10-Q
    contains forward-looking statements, 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 numerous risks and
    uncertainties, there are important factors that could cause the
    companys 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 the 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, forecasting, 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 should not be read as guarantees of future
    performance or results, and will not necessarily be accurate
    indicators of whether, or the time at which, such performance or
    results will be achieved. There is no assurance that the events
    or circumstances reflected in forward-looking statements will
    occur or be achieved. Forward-looking statements are necessarily
    dependent on assumptions, data or methods that may be incorrect
    or imprecise and the company may not be able to realize them.
  The following factors, among others, apply to the
    companys business as a whole and could cause its actual
    results and future events to differ materially from those set
    forth or contemplated in the forward-looking statements:
  
    changes in general economic conditions, global trade or in
    the real estate sector (including risks relating to decreasing
    real estate valuations and impairment charges);
    risks associated with using debt to fund the companys
    business activities, including re-financing and interest rate
    risks;
    the companys failure to obtain, renew, or extend
    necessary financing or access the debt or equity markets;
    the companys failure to maintain its current credit
    agency ratings or comply with its debt covenants;
    risks related to the companys obligations in the event
    of certain defaults under co-investment venture and other
    debt;
    risks associated with equity and debt securities financings
    and issuances (including the risk of dilution);
    a downturn in the California, U.S., or the global economy,
    world trade or real estate conditions and other financial market
    fluctuations;
    defaults on or non-renewal of leases by customers or renewal
    at lower than expected rent;
    risks and uncertainties relating to the disposition of
    properties to third parties and the companys ability to
    effect such transactions on advantageous terms and to timely
    reinvest proceeds from any such dispositions;
    the companys failure to contribute properties to its
    co-investment ventures due to such factors as its inability to
    acquire, develop, or lease properties that meet the investment
    criteria of such ventures, or the companys co-investment
    ventures inability to access debt and equity capital to
    pay for property contributions or their allocation of available
    capital to cover other capital requirements such as future
    redemptions;
    difficulties in identifying properties to acquire and in
    effecting acquisitions on advantageous terms and the failure of
    acquisitions to perform as the company expects;
    risks and uncertainties affecting property development,
    redevelopment and value-added conversion (including construction
    delays, cost overruns, the companys inability to obtain
    necessary permits and financing, the companys inability to
    lease properties at all or at favorable rents and terms, and
    public opposition to these activities);
    risks of doing business internationally and global expansion,
    including unfamiliarity with new markets and currency risks;
    risks of changing personnel and roles; 50




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##### Table of Contents




    losses in excess of the companys insurance coverage;
    unknown liabilities acquired in connection with acquired
    properties or otherwise;
    the companys failure to successfully integrate acquired
    properties and operations;
    changes in local, state and federal regulatory requirements,
    including changes in real estate and zoning laws;
    increases in real property tax rates;
    risks associated with the companys tax structuring;
    increases in interest rates and operating costs or greater
    than expected capital expenditures; and
    environmental uncertainties and risks related to natural
    disasters.  In addition, if the parent company fails to qualify and
    maintain its status as a real estate investment trust under the
    Internal Revenue Code of 1986, as amended, then the parent
    companys actual results and future events could differ
    materially from those set forth or contemplated in the
    forward-looking statements.
  The companys success also depends upon economic trends
    generally, various market conditions and fluctuations and those
    other risk factors discussed under the heading Risk
    Factors and elsewhere in the Annual Reports on
    Form 10-K
    for AMB Property Corporation and AMB Property, L.P. for the year
    ended December 31, 2008, and any amendments thereto. The
    company cautions you not to place undue reliance on
    forward-looking statements, which reflect the companys
    analysis only and speak as of the date of this report or as of
    the dates indicated in the statements. All of the companys
    forward-looking statements, including those in this report, are
    qualified in their entirety by this statement. The company
    assumes no obligation to update or supplement forward-looking
    statements.
  http://www.amb.com Form 10-K, Form 10-Q, Form 8-K 1-800-SEC-0330. http://www.sec.gov ® ® ®
  THE
    COMPANY
  ® ® and/or
 51




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##### Table of Contents



and/or
  day-to-day
    (415) 394-9000.
  Investment
    Strategy
    ® ® ® point-to-point.
   52




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##### Table of Contents




    on an owned and managed basis, which includes investments held
    on a consolidated basis or through unconsolidated joint
    ventures, the company owned or partially owned approximately
    131.9 million square feet (principally, warehouse
    distribution buildings) that were 90.5% leased; the company had
    investments in 34 development projects, which are expected to
    total approximately 9.0 million square feet upon
    completion; and the company owned 27 projects, totaling
    approximately 8.5 million square feet, which are available
    for sale or contribution;
    through non-managed unconsolidated joint ventures, the company
    had investments in 46 industrial operating properties, totaling
    approximately 7.4 million square feet; and
    the company held approximately 0.1 million square feet
    through a ground lease, which is the location of its global
    headquarters.  Operating
    Strategy
  build-to-suit
  Long Term
    Growth Strategies
  Growth
    through Operations
      Growth
    through Development
   53




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##### Table of Contents



build-to-suit
      Growth
    through Acquisitions and Capital Redeployment
      Growth
    through Global Expansion
  ®
 54




---



##### Table of Contents



speed-to-market
  Growth
    through Co-Investments
  10-50%
  Managements
    Overview
  Current
    Global Market and Economic Conditions
  10-12%
    
    strengthening the balance sheet and liquidity position,
    realigning its cost structure; and
    positioning for future opportunities.   55




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##### Table of Contents



Focus on
    the Companys Balance Sheet, Liquidity and Cost
    Structure
  year-to-date.
        year-to-date, yield-to-maturity and/or
     56




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##### Table of Contents



Primary
    Sources of Revenue and Earnings
  development-for-sale
  
    maintain and increase occupancy rates
    and/or
    increase rental rates at its properties;
    raise third-party equity in its co-investment ventures and grow
    its earnings from its private capital business from the
    acquisition of new properties or through the possible
    contribution of properties; and
    develop properties profitably and sell to third parties or
    contribute to its co-investment ventures such development
    properties.  Real
    Estate Operations
       57




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##### Table of Contents



Customer
    Bankruptcies
    Private
    Capital Business
      Development
    Business
  build-to-suit
   58




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##### Table of Contents



build-to-suit non-U.S. markets
  Impairment
    Charges
      Market
    Price of the Parent Companys Shares
    Summary
    of Key Transactions
    
    Contributed one completed development project aggregating
    approximately 1.0 million square feet to AMB Japan
    Fund I, L.P., an unconsolidated co-investment venture; 59




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##### Table of Contents




    Sold eight development projects aggregating approximately
    1.6 million square feet, including 0.1 million square
    feet that was held in an unconsolidated co-investment venture,
    and one
    five-acre
    land parcel for an aggregate sales price of
    $132.8 million; and
    Sold sixteen operating properties aggregating approximately
    2.2 million square feet, including 0.5 million square
    feet that was held in an unconsolidated co-investment venture,
    for an aggregate sales price of $143.3 million.      
    The parent company completed a common equity offering of
    47.4 million shares, generating net proceeds of
    $552.3 million, and contributed cash from the proceeds of
    the offering to the operating partnership in exchange for the
    issuance of 47.4 million partnership units;
    Extended a $325.0 million unsecured term loan facility
    through September 2010;
    Retired the AMB Japan Fund I subscription facility which
    matured in January 2009 and had an outstanding balance of
    $132.2 million as of December 31, 2008;
    Extended a Yen-denominated secured construction loan of
    ¥10.6 billion in the first quarter of 2009
    ($107.1 million using the exchange rate at March 31,
    2009), through March 2010;
    Extended two secured mortgage loans in the first quarter of 2009
    totaling $67.3 million (at the date of extension) in one of
    the companys unconsolidated joint ventures for terms of
    two and four years;
    Paid off a $100 million medium-term note which matured in
    March 2009 and had an interest rate of 3.5%;
    Completed a cash tender offer for $28.5 million and
    $146.5 million in aggregate principal amount of the 8%
    medium-term notes due 2010 and 5.45% medium-term notes due 2010,
    respectively; and
    Repurchased $8.2 million of 5.9% medium-term notes due 2013.    Critical
    Accounting Policies
  Form 10-K
 60




---



##### Table of Contents



CONSOLIDATED
    RESULTS OF OPERATIONS
    For the SixFor the Three Months Ended


Months EndedJune 30,


June 30,2009


2008


2009


2008Acquired:Number of properties






3







6Square feet (in thousands)






745







1,689Acquisition cost (in thousands)

$



$
57,071


$



$
135,544Development Properties Sold or Contributed:Number of development projects


2



6



5



10Number of land parcels










1



Square feet (in thousands)


976



1,916



2,507



3,071   For the
    Three Months Ended June 30, 2009 and 2008 (dollars in
    millions):
  For the Three Months EndedJune 30,Revenues

2009


2008


$ Change


% ChangeRental revenuesSame store

$
117.4


$
141.7


$
(24.3
)


(17.1
)%2008 acquisitions


2.5



0.5



2.0



400.0
%Development


14.1



4.9



9.2



187.8
%Other industrial


5.6



14.0



(8.4
)


(60.0
)%Total rental revenues


139.6



161.1



(21.5
)


(13.3
)%Private capital revenues


7.8



41.4



(33.6
)


(81.2
)%Total revenues

$
147.4


$
202.5


$
(55.1
)


(27.2
)%    61




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##### Table of Contents



For the Three Months EndedJune 30,Costs and Expenses

2009


2008


$ Change


% ChangeProperty operating costs:Rental expenses

$
22.0


$
23.8


$
(1.8
)


(7.6
)%Real estate taxes


20.5



22.4



(1.9
)


(8.5
)%Total property operating costs

$
42.5


$
46.2


$
(3.7
)


(8.0
)%Property operating costsSame store

$
33.2


$
39.7


$
(6.5
)


(16.4
)%2008 acquisitions


0.6







0.6



100.0
%Development


7.1



1.6



5.5



343.8
%Other industrial


1.6



4.9



(3.3
)


(67.3
)%Total property operating costs


42.5



46.2



(3.7
)


(8.0
)%Depreciation and amortization


38.7



39.7



(1.0
)


(2.5
)%General and administrative


25.4



33.7



(8.3
)


(24.6
)%Restructuring charges


3.8







3.8



100.0
%Fund costs


0.3



0.4



(0.1
)


(25.0
)%Other expenses


5.7



1.5



4.2



280.0
%Total costs and expenses

$
116.4


$
121.5


$
(5.1
)


(4.2
)%     For the Three Months EndedJune 30,Other Income and (Expenses)

2009


2008


$ Change


% ChangeDevelopment profits, net of taxes

$



$
30.4


$
(30.4
)


(100.0
)%Equity in earnings of unconsolidated joint ventures, net


4.3



6.0



(1.7
)


(28.3
)%Other income


8.6



1.9



6.7



352.6
%Interest expense, including amortization


(29.3
)


(36.5
)


(7.2
)


(19.7
)%Total other income and (expenses), net

$
(16.4
)

$
1.8


$
(18.2
)


1,011.1
%  62




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##### Table of Contents



For the Three Months EndedJune 30,Discontinued Operations

2009


2008


$ Change


% ChangeIncome attributable to discontinued operations

$
4.4


$
4.0


$
0.4



10.0
%Gains from sale of real estate interests, net of taxes


10.1



1.2



8.9



741.7
%Total discontinued operations

$
14.5


$
5.2


$
9.3



178.8
%     For the Three Months EndedJune 30,Preferred Stock/Units

2009


2008


$ Change


% ChangePreferred stock dividends/unit distributions

$
(4.0
)

$
(4.0
)

$





%Total preferred stock/units

$
(4.0
)

$
(4.0
)

$





%  63




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##### Table of Contents



For the
    Six Months Ended June 30, 2009 and 2008 (dollars in
    millions):
  For the SixMonths EndedJune 30,Revenues

2009


2008


$ Change


% ChangeRental revenuesSame store

$
241.8


$
292.2


$
(50.4
)


(17.2
)%2008 acquisitions


5.1



0.8



4.3



537.5
%Development


26.4



10.3



16.1



156.3
%Other industrial


16.6



18.0



(1.4
)


(7.8
)%Total rental revenues


289.9



321.3



(31.4
)


(9.8
)%Private capital revenues


19.5



51.4



(31.9
)


(62.1
)%Total revenues

$
309.4


$
372.7


$
(63.3
)


(17.0
)%     For the SixMonths EndedJune 30,Costs and Expenses

2009


2008


$ Change


% ChangeProperty operating costs:Rental expenses

$
50.4


$
47.5


$
2.9



6.1
%Real estate taxes


40.8



43.2



(2.4
)


(5.6
)%Total property operating costs

$
91.2


$
90.7


$
0.5



0.6
%Property operating costsSame store

$
73.0


$
80.2


$
(7.2
)


(9.0
)%2008 acquisitions


1.4







1.4



100.0
%Development


11.9



2.9



9.0



310.3
%Other industrial


4.9



7.6



(2.7
)


(35.5
)%Total property operating costs


91.2



90.7



0.5



0.6
%Depreciation and amortization


80.5



80.2



0.3



0.4
%General and administrative


56.6



68.9



(12.3
)


(17.9
)%Restructuring charges


3.8







3.8



100.0
%Fund costs


0.6



0.6








%Real estate impairment losses


161.1







161.1



100.0
%Other expenses


5.0



1.3



3.7



280.0
%Total costs and expenses

$
398.8


$
241.7


$
157.1



65.0
%  64




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##### Table of Contents



For the SixMonths EndedJune 30,Other Income and (Expenses)

2009


2008


$ Change


% ChangeDevelopment profits, net of taxes

$
33.3


$
48.2


$
(14.9
)


(30.9
)%Gains from sale or contribution of real estate interests, net






20.0



(20.0
)


(100.0
)%Equity in earnings of unconsolidated joint ventures, net


4.3



9.0



(4.7
)


(52.2
)%Other income


1.5



6.3



(4.8
)


(76.2
)%Interest expense, including amortization


(62.0
)


(67.6
)


(5.6
)


(8.3
)%Total other income and (expenses), net

$
(22.9
)

$
15.9


$
(38.8
)


244.0
%      65




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##### Table of Contents



For the Six Months EndedJune 30,Discontinued Operations

2009


2008


$ Change


% Change(Loss) income attributable to discontinued operations

$
(10.7
)

$
8.1


$
(18.8
)


(232.1
)%Gains from sale of real estate interests, net of taxes


28.7



2.5



26.2



1,048.0
%Total discontinued operations

$
18.0


$
10.6


$
7.4



69.8
%     For the Six Months EndedJune 30,Preferred Stock/Units

2009


2008


$ Change


% ChangePreferred stock dividends/unit distributions

$
(7.9
)

$
(7.9
)

$





%Total preferred stock/units

$
(7.9
)

$
(7.9
)

$





%   LIQUIDITY
    AND CAPITAL RESOURCES OF THE PARENT COMPANY
      day-to-day
 66




---



##### Table of Contents



Capital
    Resources of the Parent Company
    Common and Preferred Equity
      Market Equity as of June 30, 2009Shares/Units


Market


MarketSecurity

Outstanding


Price


ValueCommon stock


146,253,416
(3)

$
18.81


$
2,751,027Common limited partnership units(1)


3,435,522



18.81



64,622Total


149,688,938






$
2,815,649Total options outstanding










8,253,496Dilutive effect of stock options(2)










61,443     (1)
    
    Includes class B common limited partnership units issued by
    AMB Property II, L.P.(2)
    
    Computed using the treasury stock method and an average share
    price for the parent companys common stock of $18.08 for
    the quarter ended June 30, 2009.(3)
    
    Includes 930,231 shares of unvested restricted stock.  67




---



##### Table of Contents



Preferred Stock as of June 30, 2009Dividend


Liquidation


Redemption/CallableSecurity

Rate


Preference


DateSeries D preferred units(1)


7.18
%

$
79,767


February 2012Series L preferred stock


6.50
%


50,000


June 2008Series M preferred stock


6.75
%


57,500


November 2008Series O preferred stock


7.00
%


75,000


December 2010Series P preferred stock


6.85
%


50,000


August 2011Weighted average/total


6.90
%

$
312,267     (1)
    
    On January 29, 2007, all of the outstanding 7.75%
    series D cumulative redeemable preferred limited
    partnership units of AMB Property II, L.P. were transferred from
    one institutional investor to another institutional investor. In
    connection with that transfer, AMB Property II, L.P. agreed to
    amend the terms of the series D preferred units to, among
    other things, change the rate applicable to the series D
    preferred units from 7.75% to 7.18% and change the date prior to
    which the series D preferred units may not be redeemed from
    May 5, 2004 to February 22, 2012.      Balance as of December 31, 2008

$
451,097Net income


2,702Contributions


6,444Distributions and allocations


(17,973
)Redemption of partnership units


(71
)Sale of noncontrolling interests


(8,909
)Reallocation of partnership interest


(12,679
)Balance as of June 30, 2009

$
420,611Balance as of December 31, 2007

$
697,411Net income


37,484Contributions


6,504Distributions and allocations


(53,983
)Redemption of partnership units


(450
)Purchase of noncontrolling interest


15,067Reallocation of partnership interest


8,449Balance as of June 30, 2008

$
710,482  68




---



##### Table of Contents



June 30,


December 31,


Redemption/Callable2009


2008


DateJoint venture partners

$
280,714


$
293,367


N/ALimited partners in the operating partnership


39,497



50,831


N/AHeld through AMB Property II, L.P.:Class B limited partners


22,839



29,338


N/ASeries D preferred units (liquidation preference of $79,767)


77,561



77,561


February 2012Total noncontrolling interests

$
420,611


$
451,097     For the Three


For the SixMonths Ended


Months EndedJune 30,


June 30,2009


2008


2009


2008Joint venture partners share of net income

$
4,949


$
6,424


$
2,771


$
25,687Joint venture partners and common limited partners
    shareof development profits






1,371



702



6,113Common limited partners in the operating partnerships
    share of net income (loss)


811



1,219



(2,561
)


1,927Held through AMB Property II, L.P.:Class B common limited partnership units share of
    development profits










406



Class B common limited partnership units share of net
    income (loss)


468



565



(1,480
)


893Series D preferred units (liquidation preference of $79,767)


1,432



1,432



2,864



2,864Total noncontrolling interests share of net income

$
7,660


$
11,011


$
2,702


$
37,484     debt-to-parent debt-to-parent debt-to-parent loan-to-value 50-65%
 69




---



##### Table of Contents



debt-to-parent
  Capitalization Ratios as of June 30, 2009Parent companys share of total
    debt-to-parent
    companys share of total market capitalization(1)


53.1
%Parent companys share of total debt plus
    preferred-to-parent
    companys share of total market capitalization(1)


57.8
%Parent companys share of total
    debt-to-parent
    companys share of total assets(1)


44.0
%Parent companys share of total debt plus
    preferred-to-parent
    companys share of total assets(1)


47.9
%Parent companys share of total
    debt-to-parent
    companys share of total book capitalization(1)


47.9
%     (1)
    
    Although the parent company does not hold any indebtedness
    itself, the parent companys total debt reflects the
    consolidation of the operating partnerships total debt for
    financial reporting purposes. The parent companys
    definition of total market capitalization for the
    parent company is total debt plus preferred equity liquidation
    preferences plus market equity. The definition of parent
    companys share of total market capitalization is the
    parent companys share of total debt plus preferred equity
    liquidation preferences plus market equity. The definition of
    market equity is the total number of outstanding
    shares of common stock of the parent company and common limited
    partnership units of the operating partnership and AMB Property
    II, L.P. multiplied by the closing price per share of the parent
    companys common stock as of June 30, 2009. The
    definition of preferred is preferred equity
    liquidation preferences. Parent companys share of
    total book capitalization is defined as the parent
    companys share of total debt plus noncontrolling interests
    to preferred unitholders and limited partnership unitholders
    plus stockholders equity. Parent companys
    share of total debt is the parent companys pro rata
    portion of the total debt based on the parent companys
    percentage of equity interest in each of the consolidated and
    unconsolidated joint ventures holding the debt. Parent
    companys share of total assets is the parent
    companys pro rata portion of the gross book value of real
    estate interests plus cash and other assets. The parent company
    believes that share of total debt is a meaningful supplemental
    measure, which enables both management and investors to analyze
    the parent companys leverage and to compare the parent
    companys leverage to that of other companies. In addition,
    it allows for a more meaningful comparison of the parent
    companys debt to that of other companies that do not
    consolidate their joint ventures. Parent companys share of
    total debt is not intended to reflect the parent companys
    actual liability should there be a default under any or all of
    such loans or a liquidation of the joint ventures. For a
    reconciliation of parent companys share of total debt to
    total consolidated debt, a GAAP financial measure, please see
    the table of debt maturities and capitalization in the section
    below entitled Liquidity and Capital Resources of AMB
    Property, L.P.  Liquidity
    of the Parent Company
     70




---



##### Table of Contents



and/or
    Dividends.
  For the SixFor the Three Months Ended


Months EndedJune 30,


June 30,Paying Entity

Security

2009


2008


2009


2008AMB Property Corporation

Common stock

$
0.280


$
0.520


$
0.560


$
1.040AMB Property Corporation

Series L preferred stock

$
0.406


$
0.406


$
0.813


$
0.813AMB Property Corporation

Series M preferred stock

$
0.422


$
0.422


$
0.844


$
0.844AMB Property Corporation

Series O preferred stock

$
0.438


$
0.438


$
0.875


$
0.875AMB Property Corporation

Series P preferred stock

$
0.428


$
0.428


$
0.856


$
0.856      71




---



##### Table of Contents



For the Six MonthsEnded June 30,Summary of Dividends and Distributions Paid

2009


2008(Dollars in thousands)Net cash provided by operating activities

$
121,128


$
127,596Dividends paid to common and preferred stockholders(1)


(47,410
)


(108,172
)Distributions to noncontrolling interests, including preferred
    units


(11,695
)


(43,931
)Excess (shortfall) of net cash provided by operating activities
    over dividends and distributions paid

$
62,023


$
(24,507
)Net proceeds from divestiture of real estate

$
278,580


$
327,516Excess of net cash provided by operating activities and net
    proceeds from divestiture of real estate over dividends and
    distributions paid

$
340,603


$
303,009     (1)
    
    Partnership unit distributions paid to the parent company by the
    operating partnership are, in turn, paid by the parent company
    as dividends to its stockholders.  Debt guarantees.
     72




---



##### Table of Contents



Potential Contingent and Unknown
    Liabilities.
  LIQUIDITY
    AND CAPITAL RESOURCES OF THE OPERATING PARTNERSHIP
  Balance Sheet Strategy.
    
    cash on hand and cash flow from operations;
    private capital from co-investment partners;
    net proceeds from contributions of properties and completed
    development projects to its co-investment ventures;
    net proceeds from the sales of development projects, value-added
    conversion projects and land to third parties;
    net proceeds from divestitures of properties;
    borrowings under its unsecured credit facilities;
    other forms of secured or unsecured financing; 73




---



##### Table of Contents




    assumption of debt related to acquired properties;
    proceeds from limited partnership unit offerings (including
    issuances of limited partnership units by the operating
    partnerships subsidiaries);
    proceeds from debt securities offerings by the operating
    partnership; and
    proceeds from equity offerings by the parent company.    
    debt service;
    development, expansion and renovation of properties;
    acquisitions;
    distributions on outstanding common, preferred and general
    partnership units; and
    working capital.         74




---



##### Table of Contents



Cash Flows.
    Capital
    Resources of the Operating Partnership
    Partners Capital. 1 2 3 4
  Development Completions.
 75




---



##### Table of Contents



For the Three Months


For the Six MonthsEnded June 30,


Ended June 30,2009


2008


2009


2008Placed in Operations:Number of projects


2



1



5



1Square feet


522,081



396,710



2,555,844



396,710Estimated investment(1)

$
55,047


$
17,396


$
198,929


$
17,396Sold:Number of projects


1







2



2Square feet


318,850







706,850



115,664Estimated investment(1)

$
28,441


$



$
50,968


$
26,249Contributed:Number of projects






1







1Square feet






406,156







406,156Estimated investment

$



$
21,572


$



$
21,572Available for Sale or Contribution:Number of projects


8



7



14



10Square feet


2,169,293



3,335,886



3,743,267



4,005,826Estimated investment(1)

$
206,906


$
373,634


$
332,116


$
461,492Total:Number of projects


11



9



21



14Square feet


3,010,224



4,138,752



7,005,961



4,924,356Estimated investment(1)

$
290,394


$
412,602


$
582,013


$
526,709     (1)
    
    Estimated investment is before the impact of cumulative real
    estate impairment losses.    For the Three Months


For the Six MonthsEnded June 30,


Ended June 30,2009


2008


2009


2008Number of completed development projects


2



2



4



4Number of land parcels










1



Square feet


976,450



19,573



1,525,941



59,932Gross sales price

$
70,993


$
4,218


$
112,801


$
12,995Net proceeds

$
58,900


$
3,980


$
98,610


$
11,171Development gains, net of taxes

$



$
1,253


$
4,698


$
2,268  76




---



##### Table of Contents



For the Three Months


For the Six MonthsEnded June 30,


Ended June 30,2009


2008


2009


2008Number of projects contributed to AMB Institutional Alliance
    Fund III, L.P.






1







3Square feet






406,156







1,409,533Number of projects contributed to AMB-SGP Mexico, LLC






2







2Square feet






947,323







947,323Number of projects contributed to AMB Europe Fund I,
    FCP-FIS














1Square feet














110,701Number of projects contributed to AMB Japan Fund I,
    L.P.






1



1



1Square feet






543,039



981,162



543,039Total number of contributed development assets






4



1



7Total square feet






1,896,518



981,162



3,010,596Gross contribution price

$



$
120,032


$
184,793


$
232,750Net proceeds

$



$
97,081


$
56,822


$
194,733Development gains, net of taxes

$



$
29,149


$
28,588


$
45,954   Development Sales and Contributions.
    Gains from Sale or Contribution of Real Estate Interests,
    Net.
 77




---



##### Table of Contents



Properties Held for Sale or Contribution,
    Net. development-for-sale
  15-20%. Accounting for the Impairment or Disposal of Long-Lived
    Assets
  Gains from Sale of Real Estate Interests, Net of
    Taxes.
  Co-investment Ventures.
   78




---



##### Table of Contents



Approximate


OriginalConsolidated Co-investment

Co-investment Venture

Ownership


PlannedVenture

Partner

Percentage


Capitalization(1)AMB Institutional Alliance Fund II, L.P.(2)

AMB Institutional Alliance REIT II, Inc.


20%


$
490,000AMB-SGP, L.P.(3)

Industrial JV Pte. Ltd.


50%


$
420,000AMB-AMS,
    L.P.(4)

PMT, SPW and TNO(5)


39%


$
228,000     (1)
    
    Planned capitalization includes anticipated debt and all
    partners expected equity contributions.(2)
    
    AMB Institutional Alliance Fund II, L.P. is a co-investment
    partnership formed in 2001 with institutional investors, which
    invest through a private real estate investment trust, and a
    third-party limited partner.(3)
    
    AMB-SGP, L.P. is a co-investment partnership formed in 2001 with
    Industrial JV Pte. Ltd., a subsidiary of GIC Real Estate Pte.
    Ltd., the real estate investment subsidiary of the Government of
    Singapore Investment Corporation.(4)
    
    AMB-AMS,
    L.P. is a co-investment partnership formed in 2004 with three
    Dutch pension funds.(5)
    
    PMT is Stichting Pensioenfonds Metaal en Techniek, SPW is
    Stichting Pensioenfonds voor de Woningcorporaties and TNO is
    Stichting Pensioenfonds TNO.      ApproximateUnconsolidated Co-investment

Co-investment Venture

Ownership


PlannedVenture

Partner

Percentage


Capitalization(1)AMB Institutional Alliance Fund III, L.P.(2)(3)

AMB Institutional Alliance REIT III, Inc.


19%


$
3,306,000AMB Europe Fund I, FCP-FIS(3)(4)

Institutional investors


21%


$
1,231,000AMB Japan Fund I, L.P.(5)

Institutional investors


20%


$
1,445,000AMB-SGP Mexico, LLC(6)

Industrial (Mexico) JV Pte. Ltd.


22%


$
601,000AMB DFS Fund I, LLC(7)

Strategic Realty Ventures, LLC


15%


$
117,000     (1)
    
    Planned capitalization includes anticipated debt and all
    partners expected equity contributions.(2)
    
    AMB Institutional Alliance Fund III, L.P. is an open-ended
    co-investment partnership formed in 2004 with institutional
    investors, which invest through a private real estate investment
    trust. On July 1, 2008, the partners of AMB Partners II,
    L.P. (previously, a consolidated co-investment venture)
    contributed their interests in AMB Partners II, L.P. to AMB
    Institutional Alliance Fund III, L.P. in exchange for
    interests in AMB Institutional Alliance Fund III, L.P., an
    unconsolidated co-investment venture.(3)
    
    The planned capitalization and investment capacity of AMB
    Institutional Alliance Fund III, L.P. and AMB Europe
    Fund I, FCP-FIS, as open-ended funds is not limited. The
    planned capitalization represents the gross book value of real
    estate assets as of the most recent quarter end.(4)
    
    AMB Europe Fund I, FCP-FIS, is an open-ended co-investment
    venture formed in 2007 with institutional investors. The venture
    is Euro-denominated. U.S. dollar amounts are converted at the
    exchange rate in effect at June 30, 2009.(5)
    
    AMB Japan Fund I, L.P. is a co-investment venture formed in
    2005 with institutional investors. The venture is
    Yen-denominated. U.S. dollar amounts are converted at the
    exchange rate in effect at June 30, 2009. 79




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##### Table of Contents



(6)
    
    AMB-SGP Mexico, LLC is a co-investment venture formed in 2004
    with Industrial (Mexico) JV Pte. Ltd., a subsidiary of GIC Real
    Estate Pte. Ltd., the real estate investment subsidiary of the
    Government of Singapore Investment Corporation.(7)
    
    AMB DFS Fund I, LLC is a co-investment venture formed in
    2006 with a subsidiary of GE Real Estate to build and sell
    properties.    Debt. debt-to-operating debt-to-operating debt-to-operating loan-to-value 50-65% debt-to-operating
       80




---



##### Table of Contents



and/or
     81




---



##### Table of Contents



Credit Facilities.
 82




---



##### Table of Contents



83




---



##### Table of Contents



Consolidated JointWholly-Owned


VentureUnsecured











Total


UnconsolidatedSenior


Credit


Other


Secured


Secured


Other


Consolidated


Joint


TotalDebt


Facilities(1)


Debt


Debt


Debt


Debt


Debt


Venture Debt


Debt2009

$



$



$
11,865


$
130,845


$
79,644


$



$
222,354


$
22,930


$
245,2842010


75,000



479,482



325,941



419,368



110,917







1,410,708



200,990



1,611,6982011


75,000



115,460



1,014



15,036



83,193







289,703



672,504



962,2072012










1,093



2,683



386,920



50,000



440,696



442,797



883,4932013


491,795







920



19,416



39,222







551,353



710,493



1,261,8462014










616



405



6,481







7,502



777,870



785,3722015


112,491







664



16,271



17,609







147,035



274,300



421,3352016


















16,231







16,231



73,051



89,2822017


















1,272







1,272



351,585



352,8572018


125,000















1,455







126,455



183,194



309,649Thereafter


















38,538







38,538



5,844



44,382Subtotal

$
879,286


$
594,942


$
342,113


$
604,024


$
781,482


$
50,000


$
3,251,847


$
3,715,558


$
6,967,405Unamortized net discount


(7,917
)










(1,460
)


(184
)






(9,561
)


(4,253
)


(13,814
)Subtotal

$
871,369


$
594,942


$
342,113


$
602,564


$
781,298


$
50,000


$
3,242,286


$
3,711,305


$
6,953,591Joint venture partners share of debt


















(437,562
)


(40,000
)


(477,562
)


(2,932,806
)


(3,410,368
)Operating partnerships share of total debt(2)

$
871,369


$
594,942


$
342,113


$
602,564


$
343,736


$
10,000


$
2,764,724


$
778,499


$
3,543,223Weighted average interest rate


6.4
%


0.8
%


3.6
%


3.7
%


5.1
%


5.8
%


4.2
%


4.8
%


4.5
%Weighted average maturity (years)


4.5



1.2



1.3



1.2



3.0



3.2



2.6



4.6



3.6     (1)
    
    Represents three credit facilities with total capacity of
    approximately $1.6 billion. Includes $165.0 million of
    U.S. dollar borrowings, as well as $273.5 million,
    $87.7 million, $41.0 million and $27.7 million in
    Yen, Canadian dollar, Euro and Singapore dollar-based borrowings
    outstanding at June 30, 2009, respectively, translated to
    U.S. dollars using the foreign exchange rates in effect on
    June 30, 2009.(2)
    
    Operating partnerships share of total debt represents the
    operating partnerships pro rata portion of the total debt
    based on the operating partnerships percentage of equity
    interest in each of the consolidated or unconsolidated joint
    ventures holding the debt. The operating partnership believes
    that operating partnerships share of total debt is a
    meaningful supplemental measure, which enables both management
    and investors to analyze its leverage and to compare its
    leverage to that of other companies. In addition, it allows for
    a more meaningful comparison of the operating partnerships
    debt to that of other companies that do not consolidate their
    joint ventures. Operating partnerships share of total debt
    is not intended to reflect the operating partnerships
    actual liability should there be a default under any or all of
    such loans or a liquidation of the co-investment ventures. The
    above table reconciles operating partnerships share of
    total debt to total consolidated debt, a GAAP financial measure. 84




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##### Table of Contents



After Extension Options(1)(2)Wholly-owned debt

2009


2010


2011


2012Unsecured Senior Debt

$



$
75,000


$
75,000


$
Credit Facilities










479,482



115,460Other Debt


11,421



325,000







AMB Secured Debt


130,385



188,403



244,677



2,316Subtotal


141,806



588,403



799,159



117,776Consolidated Joint VenturesAMB-AMS


13,294



2,597







AMB Institutional Alliance Fund II






10,157



31,432



5,655AMB-SGP


15,414







28,038



295,883Other Industrial Operating Joint Ventures


43,069



49,089



15,699



Subtotal


71,777



61,843



75,169



301,538Unconsolidated Joint VenturesAMB Institutional Alliance Fund III






27,443



301,136



78,568AMB Japan Fund I






108,110



198,021



175,010AMB-SGP Mexico










58,825



168,814Other Industrial Operating Joint Ventures


150



9,059



32,428



AMB Europe Fund I














6,338Subtotal


150



144,612



590,410



428,730Total Consolidated


213,583



650,246



874,328



419,314Total Unconsolidated


150



144,612



590,410



428,730Total

$
213,733


$
794,858


$
1,464,738


$
848,044Total Operating Partnerships Share(3)

$
181,014


$
652,649


$
955,180


$
355,546     (1)
    
    Excludes scheduled principal amortization of debt maturing in
    years subsequent to 2012, as well as debt premiums and discounts.(2)
    
    Subject to certain conditions.(3)
    
    Total operating partnerships share calculation represents
    the operating partnerships pro-rata portion of total debt
    maturing in 2009 through 2012 based on its percentage of equity
    interest in each of the consolidated and unconsolidated joint
    ventures holding the debt.  Market Capital as of June 30, 2009Units


Market


MarketSecurity

Outstanding


Price(1)


Value(1)Common general partnership units


146,024,005
(4)

$
18.81


$
2,746,712Common limited partnership units(2)


3,435,522



18.81



64,622Total


149,459,527






$
2,811,334Total options outstanding










8,253,496Dilutive effect of stock options(3)










61,443     (1)
    
    Assumes that the operating partnerships common partnership
    units are exchanged for the parent companys common stock
    on a
    one-for-one
    basis because there is no public market for the operating
    partnerships units.(2)
    
    Includes class B common limited partnership units issued by
    AMB Property II, L.P.(3)
    
    Computed using the treasury stock method and an average share
    price for the parent companys common stock of $18.08 for
    the quarter ended June 30, 2009. 85




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##### Table of Contents



(4)
    
    Includes 930,321 shares of unvested restricted stock.  Preferred Units as of June 30, 2009Distribution


Liquidation


Redemption/CallableSecurity

Rate


Preference


DateSeries D preferred units(1)


7.18
%

$
79,767


February 2012Series L preferred units


6.50
%


50,000


June 2008Series M preferred units


6.75
%


57,500


November 2008Series O preferred units


7.00
%


75,000


December 2010Series P preferred units


6.85
%


50,000


August 2011Weighted average/total


6.90
%

$
312,267     (1)
    
    On January 29, 2007, all of the outstanding 7.75%
    series D cumulative redeemable preferred limited
    partnership units of AMB Property II, L.P. were transferred from
    one institutional investor to another institutional investor. In
    connection with that transfer, AMB Property II, L.P. agreed to
    amend the terms of the series D preferred units to, among
    other things, change the rate applicable to the series D
    preferred units from 7.75% to 7.18% and change the date prior to
    which the series D preferred units may not be redeemed from
    May 5, 2004 to February 22, 2012.      Balance as of December 31, 2008

$
400,266Net income


4,561Contributions


6,444Distributions and allocations


(16,611
)Sale of noncontrolling interests


(8,909
)Reallocation of partnership interest


(4,637
)Balance as of June 30, 2009

$
381,114Balance as of December 31, 2007

$
627,377Net income


34,394Contributions


6,504Distributions and allocations


(44,345
)Purchase of noncontrolling interest


15,067Reallocation of partnership interest


2,679Balance as of June 30, 2008

$
641,676     Redemption/CallableJune 30, 2009


December 31, 2008


DateJoint venture partners

$
280,714


$
293,367


N/AHeld through AMB Property II, L.P.:Class B limited partners


22,839



29,338


N/ASeries D preferred units (liquidation preference of $79,767)


77,561



77,561


February 2012Total noncontrolling interests

$
381,114


$
400,266  86




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##### Table of Contents



For the Three Months


For the Six MonthsEnded June 30,


Ended June 30,2009


2008


2009


2008Joint venture partners share of net (loss) income

$
4,949


$
6,424


$
2,771


$
25,687Joint venture partners share of development profits






196







4,409Held through AMB Property II, L.P.:Class B common limited partnership units share of
    development profits










406



Class B common limited partnership units


468



565



(1,480
)


893Series D preferred units (liquidation preference of $79,767)


1,432



1,432



2,864



2,864Total noncontrolling interests share of net (loss) income

$
6,849


$
8,617


$
4,561


$
33,853   Capitalization Ratios as of June 30, 2009Operating partnerships share of total
    debt-to-operating
    partnerships share of total market capitalization(1)


53.1%Operating partnerships share of total debt plus
    preferred-to-operating
    partnerships share of total market capitalization(1)


57.8%Operating partnerships share of total
    debt-to-operating
    partnerships share of total assets(1)


44.0%Operating partnerships share of total debt plus
    preferred-to-operating
    partnerships share of total assets(1)


47.9%Operating partnerships share of total
    debt-to-operating
    partnerships share of total book capitalization(1)


47.9%     (1)
    
    The operating partnerships definition of total
    market capitalization for the operating partnership is
    total debt plus preferred equity liquidation preferences plus
    market capital. The definition of operating
    partnerships share of total market capitalization is
    the operating partnerships share of total debt plus
    preferred equity liquidation preferences plus market capital.
    The operating partnerships definition of market
    capital is the total number of outstanding common general
    partnership units of the operating partnership and common
    limited partnership units of AMB Property II, L.P. multiplied by
    the closing price per share of the parent companys common
    stock as of June 30, 2009. The definition of
    preferred is preferred equity liquidation
    preferences. Operating partnerships share of total
    book capitalization is defined as the operating
    partnerships share of total debt plus noncontrolling
    interests to preferred unitholders and limited partnership
    unitholders plus stockholders equity. Operating
    partnerships share of total debt is the operating
    partnerships pro rata portion of the total debt based on
    its percentage of equity interest in each of the consolidated
    and unconsolidated joint ventures holding the debt.
    Operating partnerships share of total assets
    is the operating partnerships pro rata portion of the
    gross book value of real estate interests plus cash and other
    assets. The operating partnership believes that operating
    partnerships share of total debt is a meaningful
    supplemental measure, which enables both management and
    investors to analyze its leverage and to compare its leverage to
    that of other companies. In addition, it allows for a more
    meaningful comparison of the operating partnerships debt
    to that of other companies that do not consolidate their joint
    ventures. Operating partnerships share of total debt is
    not intended to reflect the operating partnerships actual
    liability should there be a default under any or all of such
    loans or a liquidation of the joint ventures. For a
    reconciliation of operating partnerships share of total
    debt to total consolidated debt, a GAAP financial measure,
    please see the table of debt maturities and capitalization above.  Liquidity
    of the Operating Partnership
   87




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##### Table of Contents



For the SixFor the Three Months Ended


Months EndedJune 30,


June 30,Paying Entity

Security

2009


2008


2009


2008AMB Property, L.P.

Common limited partnership units

$
0.280


$
0.520


$
0.560


$
1.040AMB Property, L.P.

Series L preferred units

$
0.406


$
0.406


$
0.813


$
0.813AMB Property, L.P.

Series M preferred units

$
0.422


$
0.422


$
0.844


$
0.844AMB Property, L.P.

Series O preferred units

$
0.438


$
0.438


$
0.875


$
0.875AMB Property, L.P.

Series P preferred units

$
0.428


$
0.428


$
0.856


$
0.856AMB Property II, L.P.

Class B common limited partnership units

$
0.280


$
0.520


$
0.560


$
1.040AMB Property II, L.P.

Series D preferred units

$
0.898


$
0.898


$
1.795


$
1.795      88




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##### Table of Contents



For the Six MonthsEnded June 30,Summary of Distributions Paid

2009


2008(Dollars in thousands)Net cash provided by operating activities

$
121,128


$
127,596Distributions paid to partners


(48,629
)


(108,172
)Distributions to noncontrolling interests, including preferred
    units


(10,476
)


(43,931
)Excess (shortfall) of net cash provided by operating activitiesover distributions paid

$
62,023


$
(24,507
)Net proceeds from divestiture of real estate

$
278,580


$
327,516Excess of net cash provided by operating activities and net
    proceeds from divestiture of real estate over distributions paid

$
340,603


$
303,009   Capital
    Commitments of the Operating Partnership
    For the Three Months


For the Six MonthsEnded June 30,


Ended June 30,2009


2008


2009


2008The Americas:Number of new development projects


1



6



2



10Square feet


96,250



2,215,980



285,587



3,337,757Estimated total investment(1)

$
7,248


$
158,865


$
19,364


$
244,073Europe:Number of new development projects


1



1



2



1Square feet


125,227



340,441



400,029



340,441Estimated total investment(1)

$
24,121


$
32,161


$
41,239


$
32,161Asia:Number of new development projects






2







2Square feet






694,315







694,315Estimated total investment(1)

$



$
56,651


$



$
56,651Total:Number of new development projects


2



9



4



13Square feet


221,477



3,250,736



685,616



4,372,513Estimated total investment(1)

$
31,369


$
247,677


$
60,603


$
332,885Total development pipeline estimated investment(1)(2)

$
758,141


$
1,580,997


$
758,141


$
1,580,997Total development pipeline invested to date(3)

$
645,190


$
1,201,627


$
645,190


$
1,201,627Total development pipeline remaining to invest(3)(4)

$
112,951


$
379,370


$
112,951


$
379,370     (1)
    
    Includes total estimated cost of development, renovation, or
    expansion, including initial acquisition costs, prepaid ground
    leases, buildings, and associated carry costs. Estimated total
    investments are based on current forecasts and are subject to
    change.
    Non-U.S.
    dollar investments are translated into U.S. dollars using the
    exchange rate as of June 30, 2009 or 2008, as applicable. 89




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##### Table of Contents



(2)
    
    Excludes the impact of real estate impairment losses and
    includes value-added conversions.(3)
    
    Amounts include capitalized interest and overhead costs, as
    applicable.(4)
    
    Calculated using estimated total investment before the impact of
    real estate impairment losses.  Development Pipeline.
  Lease Commitments.
  Co-Investment Ventures.
  Captive Insurance Company.
 90




---



##### Table of Contents



Potential Contingent and Unknown
    Liabilities.
  
    liabilities for environmental conditions;
    losses in excess of insured coverage;
    claims of customers, vendors or other persons dealing with the
    companys predecessors prior to the companys
    formation or acquisition transactions that had not been asserted
    or were unknown prior to the operating partnerships
    formation or acquisition transactions;
    claims for indemnification by the general partners, officers and
    directors and others indemnified by the former owners of the
    operating partnerships properties;
    accrued but unpaid liabilities incurred in the ordinary course
    of business; and
    tax, legal and regulatory liabilities.  Capital
    Deployment
    For the Three Months


For the Six MonthsEnded June 30,


Ended June 30,2009


2008


2009


2008The Americas:Acres






49



4



159Estimated build out potential (square feet)






962,012







2,863,144Investment(1)

$



$
43,007


$
1,539


$
79,235Europe:Acres






15







45Estimated build out potential (square feet)






391,182







882,318Investment(1)

$



$
20,062


$



$
24,373Asia:Acres


22



33



38



38Estimated build out potential (square feet)


619,290



767,003



1,075,819



1,184,836Investment(1)

$
13,519


$
6,064


$
17,032


$
15,593Total:Acres


22



97



42



242Estimated build out potential (square feet)


619,290



2,120,197



1,075,819



4,930,298Investment(1)

$
13,519


$
69,133


$
18,571


$
119,201     (1)
    
    Represents actual cost incurred to date including initial
    acquisition, associated closing costs, infrastructure and
    associated capitalized interest and overhead costs. 91




---



##### Table of Contents



For the Three Months


For the Six MonthsEnded June 30,


Ended June 30,2009


2008


2009


2008Number of properties acquired by AMB Institutional Alliance
    Fund III, L.P.






1







4Square feet






119,839







997,611Expected investment(1)

$



$
7,668


$



$
101,056Number of properties acquired by AMB Europe Fund I, FCP-FIS






2







3Square feet






683,518







848,313Expected investment(1)

$



$
86,476


$



$
154,499Number of properties acquired by AMB Property, L.P.






3







6Square feet






744,688







1,688,906Expected investment(1)

$



$
52,071


$



$
135,544Total number of properties acquired






6







13Total square feet






1,548,045







3,534,830Total acquisition cost

$



$
140,263


$



$
380,107Total acquisition capital






5,952







10,992Total expected investment(1)

$



$
146,215


$



$
391,099     (1)
    
    Includes total estimated cost of development, renovation, or
    expansion, including initial acquisition costs, prepaid ground
    leases, buildings, tenant improvements and associated
    capitalized interest and overhead costs. Estimated total
    investments are based on current forecasts and are subject to
    change.
    Non-U.S.
    dollar investments are translated into U.S. dollars using the
    exchange rate as of June 30, 2009 or 2008, as applicable.  OFF-BALANCE
    SHEET ARRANGEMENTS
  Standby Letters of Credit.
  Guarantees and Contribution
    Obligations.
     92




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##### Table of Contents



Euro 364-day and/or 5-year
  Performance and Surety Bonds.
  Promote Interests and Other Contractual
    Obligations.
  SUPPLEMENTAL
    EARNINGS MEASURES
  Funds
    From Operations (FFO) and Funds From Operations Per
    Share and Unit (FFOPS)
     93




---



##### Table of Contents



94




---



##### Table of Contents



For the Three Months


For the Six MonthsEnded June 30,


Ended June 30,2009


2008


2009


2008Net income (loss) available to common unitholders of the
    operating partnership

$
17,973


$
74,773


$
(107,308
)

$
114,627Net (income) loss available to common unitholders of the
    operating partnership attributable to limited partners of the
    operating partnership


(811
)


(2,372
)


1,859



(3,598
)Net income (loss) available to common stockholders of the parent
    company


17,162



72,401



(105,449
)


111,029Gains from sale or contribution of real estate interests, net


(10,090
)


(1,159
)


(28,704
)


(22,514
)Depreciation and amortization:Total depreciation and amortization


38,724



39,730



80,460



80,214Discontinued operations depreciation


592



1,162



2,315



2,351Non-real estate depreciation


(1,953
)


(2,155
)


(4,090
)


(3,789
)Adjustments to derive FFO from consolidated joint ventures:Joint venture partners noncontrolling interests (Net
    income (loss))


4,949



6,424



2,771



25,687Limited partnership unitholders noncontrolling interests
    (Net income (loss))


1,279



1,784



(4,041
)


2,820Limited partnership unitholders noncontrolling interests
    (Development gains)






1,175



1,108



1,704FFO attributable to noncontrolling interests


(7,151
)


(16,417
)


(10,863
)


(32,993
)Adjustments to derive FFO from unconsolidated joint ventures:The companys share of net (income) loss


(4,284
)


(6,059
)


(4,250
)


(8,987
)The companys share of FFO


11,786



12,276



19,310



21,138Allocation to participating securities(1)


(66
)


(335
)






(596
)Funds from operations

$
50,948


$
108,827


$
(51,433
)

$
176,064Basic FFO per common share and unit

$
0.34


$
1.08


$
(0.41
)

$
1.74Diluted FFO per common share and unit

$
0.34


$
1.05


$
(0.41
)

$
1.70Weighted average common shares and units:Basic


148,753,886



101,055,221



125,427,312



101,407,966Diluted


148,815,329



103,241,224



125,427,312



103,457,171     (1)
    
    In accordance with FSP No. EITF
    03-6-1 and
    SFAS No. 128, the FFO per common share and unit is
    adjusted for FFO distributed through declared dividends and
    allocated to all participating securities (weighted average
    common shares and units outstanding and unvested restricted
    shares outstanding) under the two-class method. Under this
    method, allocations were made to 930,321 unvested restricted
    shares outstanding for both the three 95




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##### Table of Contents



and six months ended June 30, 2009 and 893,381 unvested
    restricted shares outstanding for both the three and six months
    ended June 30, 2008.  Same
    Store Net Operating Income (SS NOI)
    year-over-year
 96




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##### Table of Contents



For the Three Months


For the Six MonthsEnded June 30,


Ended June 30,2009


2008


2009


2008Net income (loss)

$
29,034


$
88,030


$
(94,322
)

$
157,435Private capital revenues


(7,795
)


(41,413
)


(19,490
)


(51,336
)Depreciation and amortization


38,724



39,730



80,460



80,214Real estate impairment losses










161,067



General and administrative and fund costs


25,685



34,128



57,193



69,475Restructuring charges


3,824







3,824



Total other income and expenses


22,134



(390
)


27,943



(14,536
)Total discontinued operations


(14,544
)


(5,167
)


(18,020
)


(10,621
)Net operating income


97,062



114,918



198,655



230,631Less non same-store NOI


(11,487
)


(26,839
)


(24,030
)


(51,783
)Less non-cash adjustments(1)


844



(607
)


853



(1,794
)Cash-basis same-store NOI

$
86,419


$
87,472


$
175,478


$
177,054     (1)
    
    Non-cash adjustments include straight-line rents and
    amortization of lease intangibles for the same store pool only.  OWNED AND
    MANAGED OPERATING AND LEASING STATISTICS
  Owned and
    Managed Operating and Leasing Statistics(1)
    Operating PortfolioSquare feet owned(2)(3)


131,901,732Occupancy percentage(3)


90.5
%Average occupancy percentage


91.1
%Weighted average lease terms (years):Original


6.2Remaining


3.5Trailing four quarters tenant retention


62.1
%Trailing four quarters rent change on renewals and rollovers:(4)Percentage


0.2
%Same space square footage commencing (millions)


16.8Trailing four quarters second generation leasing activity:(5)Tenant improvements and leasing commissions per sq. ft.:Retained

$
1.33Re-tenanted

$
2.85Weighted average

$
1.84Square footage commencing (millions)


21.0     (1)
    
    Schedule includes owned and managed operating properties. This
    excludes development and renovation projects and recently
    completed development projects available for sale or
    contribution. 97




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##### Table of Contents



(2)
    
    As of June 30, 2009, the company had investments in
    7.4 million square feet of operating properties through its
    investments in non-managed unconsolidated joint ventures and
    0.1 million square feet, which is the location of its
    global headquarters.(3)
    
    On a consolidated basis, the company had approximately
    72.6 million rentable square feet with an occupancy rate of
    89.5% at June 30, 2009.(4)
    
    Rent changes on renewals and rollovers are calculated as the
    difference, weighted by square feet, of the net annualized base
    rent (ABR) due the first month of a term commencement and the
    net ABR due the last month of the former customers term.
    If free rent is granted, then the first positive full rent value
    is used as a point of comparison. The rental amounts exclude
    base stop amounts, holdover rent and premium rent charges. If
    either the previous or current lease terms are under
    12 months, then they are excluded from this calculation. If
    the lease is first generation or there is no prior lease for
    comparison, then it is excluded from this calculation.(5)
    
    Second generation tenant improvements and leasing commissions
    per square foot are the total cost of tenant improvements,
    leasing commissions and other leasing costs incurred during
    leasing of second generation space divided by the total square
    feet leased. Costs incurred prior to leasing available space are
    not included until such space is leased. Second generation space
    excludes newly developed square footage or square footage vacant
    at acquisition.    Total/WeightedOwned and Managed Property Data(1)

The Americas


Europe


Asia


AverageFor the quarter ended June 30, 2009:Rentable square feet


110,999,085



10,588,112



10,314,535



131,901,732Occupancy percentage at period end(2)


90.0
%


95.3
%


90.7
%


90.5
%Trailing four quarters same space square footage leased


14,699,827



524,481



1,555,781



16,780,089Trailing four quarters rent change on renewals and
    rollovers(2)(3)


0.8
%


(5.4
)%


(1.0
)%


0.2
%     (1)
    
    Schedule includes owned and managed operating properties which
    the company defines as properties in which it has at least a 10%
    ownership interest, for which the company is the property or
    asset manager and which the company currently intends to hold
    for the long term. This excludes development and renovation
    projects and recently completed development projects available
    for sale or contribution.(2)
    
    On a consolidated basis, for the Americas, Europe and Asia,
    occupancy percentage at period end for 2009 was 89.5%, 94.1% and
    88.8%, and trailing four quarters rent change on renewals and
    rollovers at period end for 2009 was 1.6%, n/a and (1.1)%,
    respectively. Properties in Europe are primarily held in the
    unconsolidated co-investment venture AMB Europe Fund I,
    FCP-FIS.(3)
    
    Rent changes on renewals and rollovers are calculated as the
    difference, weighted by square feet, of the net ABR due the
    first month of a term commencement and the net ABR due the last
    month of the former customers term. If free rent is
    granted, then the first positive full rent value is used as a
    point of comparison. The rental amounts exclude base stop
    amounts, holdover rent and premium rent charges. If either the
    previous or current lease terms are under 12 months, then
    they are excluded from this calculation. If the lease is first
    generation or there is no prior lease for comparison, then it is
    excluded from this calculation. 98




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##### Table of Contents



Owned and
    Managed Same Store Operating Statistics(1)
    Same Store Pool(2)Square feet in same store pool(3)


115,425,681% of total square feet


87.5
%Occupancy percentage(3)


90.4
%Average occupancy percentage


91.2
%Weighted average lease terms (years):Original


6.1Remaining


3.2Trailing four quarters tenant retention


62.9
%Trailing four quarters rent change on renewals and rollovers:(4)Percentage


(0.1
)%Same space square footage commencing (millions)


15.6Growth % increase (decrease) (including straight-line rents):Revenues(5)


(3.4
)%Expenses(5)


0.9
%Net operating income, excluding lease termination fees(5)(6)


(4.9
)%Growth % increase (decrease) (excluding straight-line rents):Revenues(5)


(2.8
)%Expenses(5)


0.9
%Net operating income, excluding lease termination fees(5)(6)


(4.1
)%     (1)
    
    Schedule includes owned and managed operating properties. This
    excludes development and renovation projects and recently
    completed development projects available for sale or
    contribution.(2)
    
    Same store pool includes all properties that are owned as of
    both the current and prior year reporting periods and excludes
    development properties for both the current and prior reporting
    years. The same store pool is set annually and excludes
    properties purchased and developments stabilized after
    December 31, 2007 (generally defined as properties that are
    90% leased or properties that have been substantially complete
    for at least 12 months).(3)
    
    On a consolidated basis, the company had approximately
    65.4 million square feet with an occupancy rate of 89.2% at
    June 30, 2009.(4)
    
    Rent changes on renewals and rollovers are calculated as the
    difference, weighted by square feet, of the net ABR due the
    first month of a term commencement and the net ABR due the last
    month of the former customers term. If free rent is
    granted, then the first positive full rent value is used as a
    point of comparison. The rental amounts exclude base stop
    amounts, holdover rent and premium rent charges. If either the
    previous or current lease terms are under 12 months, then
    they are excluded from this calculation. If the lease is first
    generation or there is no prior lease for comparison, then it is
    excluded from this calculation.(5)
    
    For the three months ended June 30, 2009, on a consolidated
    basis, the percentage change was (2.7)%, 1.6% and (3.2)%,
    respectively, for revenues, expenses and net operating income
    (including straight-line rents) and (1.7)%, (1.6)% and (1.7)%,
    respectively, for revenues, expenses and net operating income
    (excluding straight-line rents).(6)
    
    See Supplemental Earnings Measures above for a
    discussion of same store net operating income and cash-basis
    same store net operating income and a reconciliation of same
    store net operating income and cash-basis same store net
    operating income and net income. 99




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##### Table of Contents



Item 3.
    Quantitative
    and Qualitative Disclosures About Market Risk      2009


2010


2011


2012


2013


Thereafter


Total


Fair ValueFixed rate debt(1)

$
45,404


$
759,755


$
141,972


$
378,055


$
532,320


$
307,565


$
2,165,071


$
1,993,520Average interest rate


7.1
%


4.7
%


6.6
%


5.9
%


6.1
%


6.4
%


5.7
%


n/aVariable rate debt(2)

$
176,950


$
650,953


$
147,731


$
62,641


$
19,033


$
29,468


$
1,086,776


$
1,042,522Average interest rate


1.6
%


1.1
%


1.1
%


1.3
%


2.3
%


6.3
%


1.4
%


n/aInterest payments

$
6,082


$
42,762


$
10,969


$
23,194


$
33,110


$
21,399


$
137,516



n/a     (1)
    
    Represents 66.6% of all outstanding debt at June 30, 2009.(2)
    
    Represents 33.4% of all outstanding debt at June 30, 2009.      Financial Instruments.
 100




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##### Table of Contents



September 27,


September 30,


December 11,


September 4,


November 1,


Notional


FairRelated Derivatives (in thousands)

2009


2009


2009


2010


2010


Amount


ValueInterest Rate Swaps (USD)Notional Amount

$
325,000


















$
325,000Receive Floating (%)


US LIBORPay Fixed Rate (%)


2.50
%Fair Market Value (USD)

$
(1,724
)





















$
(1,724
)Notional Amount













$
130,000






$
130,000Receive Floating (%)














3 mo. US LIBORPay Fixed Rate (%)














2.70
%Fair Market Value (USD)













$
(2,594
)









$
(2,594
)Notional Amount









$
100,000










$
100,000Receive Floating (%)










3 mo. US LIBORPay Fixed Rate (%)










2.70
%Fair Market Value (USD)









$
(893
)













$
(893
)Interest Rate Caps (USD)Notional Amount

















$
7,319


$
7,319Underlying Rate


















1 mo. US LIBORStrike Price


















3.15
%Fair Market Value (USD)


















3






$
3Foreign Exchange Forward ContractsFX Forward Contract, EuroNotional Amount (USD)





$
334,989














$
334,989Forward Strike Rate






1.41269/30/09 Forward Rate as of 6/30/2009






1.4025Fair Market Value (USD)





$
2,379


















$
2,379FX Forward Contract, CADNotional Amount (USD)





$
241,058














$
241,058Forward Strike Rate






1.15339/30/09 Forward Rate as of 6/30/2009






1.1621Fair Market Value (USD)





$
1,824


















$
1,824FX Forward Contract, GBPNotional Amount (USD)





$
70,739














$
70,739Forward Strike Rate






1.65939/30/09 Forward Rate as of 6/30/2009






1.6449Fair Market Value (USD)





$
613


















$
613$
1,209,105


$
(392
)   International Operations.
   101




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##### Table of Contents



Item 4.



Controls
    and Procedures (AMB Property Corporation)



The parent company maintains disclosure controls and procedures
    that are designed to ensure that information required to be
    disclosed in its reports filed under the Securities Exchange Act
    of 1934, as amended, is recorded, processed, summarized and
    reported within the time periods specified in the
    U.S. Securities and Exchange Commissions rules and
    forms, and that such information is accumulated and communicated
    to its management, including its chief executive officer and
    chief financial officer, as appropriate, to allow timely
    decisions regarding required disclosure. In designing and
    evaluating the disclosure controls and procedures, the parent
    companys management recognizes that any controls and
    procedures, no matter how well designed and operated, can
    provide only reasonable assurance of achieving the desired
    control objectives, and its management is required to apply its
    judgment in evaluating the cost-benefit relationship of possible
    controls and procedures. Also, the parent company has
    investments in certain unconsolidated entities, which are
    accounted for using the equity method of accounting. As the
    parent company does not control or manage these entities, its
    disclosure controls and procedures with respect to such entities
    may be substantially more limited than those it maintains with
    respect to its consolidated subsidiaries.



As required by
    Rule 13a-15(b)
    or
    Rule 15d-15(b)
    of the Securities Exchange Act of 1934, as amended, management
    of the parent company carried out an evaluation, under the
    supervision and with participation of its chief executive
    officer and chief financial officer, of the effectiveness of the
    design and operation of its disclosure controls and procedures
    that were in effect as of the end of the quarter covered by this
    report. Based on the foregoing, the parent companys chief
    executive officer and chief financial officer each concluded
    that its disclosure controls and procedures were effective at
    the reasonable assurance level.



There have been no changes in the parent companys internal
    control over financial reporting during its most recent fiscal
    quarter that have materially affected, or are reasonably likely
    to materially affect, its internal control over financial
    reporting. Controls
    and Procedures (AMB Property, L.P.)



The operating partnership maintains disclosure controls and
    procedures that are designed to ensure that information required
    to be disclosed in its reports filed under the Securities
    Exchange Act of 1934, as amended, is recorded, processed,
    summarized and reported within the time periods specified in the
    U.S. Securities and Exchange Commissions rules and
    forms, and that such information is accumulated and communicated
    to its management, including the chief executive officer and
    chief financial officer of its general partner, as appropriate,
    to allow timely decisions regarding required disclosure. In
    designing and evaluating the disclosure controls and procedures,
    the operating partnerships management recognizes that any
    controls and procedures, no matter how well designed and
    operated, can provide only reasonable assurance of achieving the
    desired control objectives, and its management is required to
    apply its judgment in evaluating the cost-benefit relationship
    of possible controls and procedures. Also, the operating
    partnership has investments in certain unconsolidated entities,
    which are accounted for using the equity method of accounting.
    As the operating partnership does not control or manage these
    entities, its disclosure controls and procedures with respect to
    such entities may be substantially more limited than those it
    maintains with respect to its consolidated subsidiaries.



As required by
    Rule 13a-15(b)
    or
    Rule 15d-15(b)
    of the Securities Exchange Act of 1934, as amended, management
    of the operating partnership carried out an evaluation, under
    the supervision and with participation of the chief executive
    officer and chief financial officer of its general partner, of
    the effectiveness of the design and operation of its disclosure
    controls and procedures that were in effect as of the end of the
    quarter covered by this report. Based on the foregoing, the
    chief executive officer and chief financial officer of the
    operating partnerships general partner each concluded that
    its disclosure controls and procedures were effective at the
    reasonable assurance level.



There have been no changes in the operating partnerships
    internal control over financial reporting during its most recent
    fiscal quarter that have materially affected, or are reasonably
    likely to materially affect, its internal control over financial
    reporting.

102




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##### Table of Contents



PART II  Item 1.
    Legal
    Proceedings    Item 1A.
    Risk
    Factors  Form 10-K
  Item 2.
    Unregistered
    Sales of Equity Securities and Use of Proceeds    Item 3.
    Defaults
    Upon Senior Securities    Item 4.
    Submission
    of Matters to a Vote of Security Holders (AMB Property
    Corporation)    For


Against


AbstainHamid R. Moghadam


87,075,851



2,044,136



12,427T. Robert Burke


88,374,245



745,742



12,427David A. Cole


88,369,979



748,058



14,377Lydia H. Kennard


88,990,643



134,969



6,802J. Michael Losh


73,100,124



16,024,213



8,077Frederick W. Reid


88,378,442



744,709



9,263Jeffrey L. Skelton


77,279,794



11,838,079



14,541Thomas W. Tusher


87,759,666



1,358,343



14,405Carl B. Webb


77,874,010



11,251,556



6,848     BrokerFor


Against


Absentions


Non-votesRatification of PricewaterhouseCoopers LLP


71,985,787



17,143,538



3,089



0   Item 5.
    Other
    Information   103




---



##### Table of Contents



Item 6.
    Exhibits  No. 001-13545.
  ExhibitNumber

Description31
.1

Rule 13a-14(a)/15d-14(a)
    Certifications dated August 7, 2009 for AMB Property
    Corporation.31
.2

Rule 13a-14(a)/15d-14(a)
    Certifications dated August 7, 2009 for AMB Property, L.P.32
.1

18 U.S.C. § 1350 Certifications dated August 7,
    2009 for AMB Property Corporation. The certifications in this
    exhibit are being furnished solely to accompany this report
    pursuant to 18 U.S.C. § 1350, and are not being filed
    for purposes of Section 18 of the Securities Exchange Act
    of 1934, as amended, and are not to be incorporated by reference
    into any of the parent companys filings, whether made
    before or after the date hereof, regardless of any general
    incorporation language in such filing.32
.2

18 U.S.C. § 1350 Certifications dated August 7,
    2009 for AMB Property, L.P. The certifications in this exhibit
    are being furnished solely to accompany this report pursuant to
    18 U.S.C. § 1350, and are not being filed for purposes
    of Section 18 of the Securities Exchange Act of 1934, as
    amended, and are not to be incorporated by reference into any of
    the operating partnerships filings, whether made before or
    after the date hereof, regardless of any general incorporation
    language in such filing.  104




---



##### Table of Contents



AMB
    PROPERTY CORPORATION
  SIGNATURES
    
  Registrant
  By:
    /s/  Hamid
    R. Moghadam   Chairman of the Board and
 Chief Executive Officer
 (Duly Authorized Officer and
 Principal Executive Officer)
  By:
    /s/  Thomas
    S. Olinger   Chief Financial Officer
 (Duly Authorized Officer and
 Principal Financial Officer)
  By:
    /s/  Nina
    A. Tran   Senior Vice President and
 Chief Accounting Officer
 (Duly Authorized Officer and Principal
 Accounting Officer)
   105




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##### Table of Contents



AMB
    PROPERTY, L.P.
  SIGNATURES
    
  By: AMB Property Corporation,
    its general partner
  By:
    /s/  Hamid
    R. Moghadam   Chairman of the Board and
 Chief Executive Officer
 (Duly Authorized Officer and
 Principal Executive Officer)
  By:
    /s/  Thomas
    S. Olinger   Chief Financial Officer
 (Duly Authorized Officer and
 Principal Financial Officer)
  By:
    /s/  Nina
    A. Tran   Senior Vice President and
 Chief Accounting Officer
 (Duly Authorized Officer and Principal
 Accounting Officer)
   106