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EX-12.1 - EX-12.1 - Prologis, Inc.pld-ex121_10.htm
EX-32.2 - EX-32.2 - Prologis, Inc.pld-ex322_14.htm
EX-32.1 - EX-32.1 - Prologis, Inc.pld-ex321_9.htm
EX-31.4 - EX-31.4 - Prologis, Inc.pld-ex314_12.htm
EX-31.3 - EX-31.3 - Prologis, Inc.pld-ex313_11.htm
EX-31.2 - EX-31.2 - Prologis, Inc.pld-ex312_6.htm
EX-31.1 - EX-31.1 - Prologis, Inc.pld-ex311_15.htm
EX-15.2 - EX-15.2 - Prologis, Inc.pld-ex152_8.htm
EX-15.1 - EX-15.1 - Prologis, Inc.pld-ex151_13.htm
EX-12.2 - EX-12.2 - Prologis, Inc.pld-ex122_7.htm

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 10-Q

 

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the quarterly period ended September 30, 2016

 

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the transition period from ______________ to ______________

 

Commission File Number:  001-13545 (Prologis, Inc.)  001-14245 (Prologis, L.P.)

 

Prologis, Inc.

Prologis, L.P.

(Exact name of registrant as specified in its charter)

 

Maryland (Prologis, Inc.)

Delaware (Prologis, L.P.)

 

94-3281941 (Prologis, Inc.)

94-3285362 (Prologis, L.P.)

(State or other jurisdiction of

incorporation or organization)

 

(I.R.S. Employer

Identification No.)

 

 

 

Pier 1, Bay 1, San Francisco, California

 

94111

(Address or principal executive offices)

 

(Zip Code)

 

(415) 394-9000

(Registrants’ telephone number, including area code)

(Former name, former address and former fiscal year, if changed since last report)

 

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing for the past 90 days.

Prologis, Inc.

Yes

No

Prologis, L.P.

Yes

No

 

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate website; if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter periods that the registrant was required to submit and post such files).

Prologis, Inc.

Yes

No

Prologis, L.P.

Yes

No

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company. See definitions of “large accelerated filer”, “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act (check one):

 

Prologis, Inc.:

 

 

 

 

Large accelerated filer   

 

Accelerated filer   

Non-accelerated filer   

Smaller reporting company   

 

 

(Do not check if a smaller reporting  company)

 

 

Prologis, L.P.:

 

 

 

 

Large accelerated filer   

 

Accelerated filer   

Non-accelerated filer   

Smaller reporting company   

 

 

(Do not check if a smaller reporting  company)

 

 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Securities Exchange Act of 1934).

Prologis, Inc.

Yes

No

Prologis, L.P.

Yes

No

 

The number of shares of Prologis, Inc.’s common stock outstanding at October 28, 2016, was approximately 528,614,000.

 

 

 

 


 

EXPLANATORY NOTE

This report combines the quarterly reports on Form 10-Q for the period ended September 30, 2016, of Prologis, Inc. and Prologis, L.P. Unless stated otherwise or the context otherwise requires, references to “Prologis, Inc.” or the “Parent” mean Prologis, Inc. and its consolidated subsidiaries; and references to “Prologis, L.P.” or the “Operating Partnership” mean Prologis, L.P., and its consolidated subsidiaries. The terms “the Company,” “Prologis,” “we,” “our” or “us” means Prologis, Inc. and the Operating Partnership collectively.

Prologis, Inc. is a real estate investment trust (“REIT”) and the general partner of the Operating Partnership. At September 30, 2016, Prologis, Inc. owned an approximate 97.41% common general partnership interest in the Operating Partnership and 100% of the preferred units in the Operating Partnership. The remaining approximate 2.59% common limited partnership interests are owned by nonaffiliated investors and certain current and former directors and officers of Prologis, Inc. As the sole general partner of the Operating Partnership, Prologis, Inc. has complete responsibility and discretion in the day-to-day management and control of the Operating Partnership.

We operate Prologis, Inc. and the Operating Partnership as one enterprise. The management of Prologis, Inc. consists of the same members as the management of the Operating Partnership. These members are officers of Prologis, Inc. and employees of the Operating Partnership or one of its subsidiaries. As general partner with control of the Operating Partnership, Prologis, Inc. consolidates the Operating Partnership for financial reporting purposes. Because the only significant asset of Prologis, Inc. is its investment in the Operating Partnership, the assets and liabilities of Prologis, Inc. and the Operating Partnership are the same on their respective financial statements.

We believe combining the quarterly reports on Form 10-Q of Prologis, Inc. and the Operating Partnership into this single report results in the following benefits:

enhances investors’ understanding of Prologis, Inc. 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;

eliminates duplicative disclosure and provides a more streamlined and readable presentation since a substantial portion of the Company’s disclosure applies to both Prologis, Inc. and the Operating Partnership; and

creates time and cost efficiencies through the preparation of one combined report instead of two separate reports.

 

It is important to understand the few differences between Prologis, Inc. and the Operating Partnership in the context of how we operate the Company. Prologis, Inc. does not conduct business itself, other than acting as the sole general partner of the Operating Partnership and issuing public equity from time to time. Prologis, Inc. itself does not incur any indebtedness, but it guarantees the unsecured debt of the Operating Partnership. The Operating Partnership holds substantially all the assets of the business, directly or indirectly, and holds the ownership interests in the Company’s investment in certain entities. The Operating Partnership conducts the operations of the business and is structured as a partnership with no publicly traded equity. Except for net proceeds from equity issuances by Prologis, Inc., which are contributed to the Operating Partnership in exchange for partnership units, the Operating Partnership generates capital required by the business through the Operating Partnership’s operations, incurrence of indebtedness and issuance of partnership units to third parties.

 

Noncontrolling interests, stockholders’ equity and partners’ capital are the main areas of difference between the consolidated financial statements of Prologis, Inc. and those of the Operating Partnership. The noncontrolling interests in the Operating Partnership’s consolidated financial statements include the interests in consolidated entities not owned by the Operating Partnership. The noncontrolling interests in Prologis, Inc.’s consolidated financial statements include the same noncontrolling interests at the Operating Partnership level, as well as the common limited partnership interests in the Operating Partnership, not owned by Prologis, Inc., which are accounted for as partners’ capital by the Operating Partnership.

 

To highlight the differences between Prologis, Inc. and the Operating Partnership, separate sections in this report, as applicable, individually discuss Prologis, Inc. and the Operating Partnership, including separate financial statements and separate Exhibit 31 and 32 certifications. In the sections that combine disclosure of Prologis, Inc. and the Operating Partnership, this report refers to actions or holdings as being actions or holdings of Prologis.

 

 

 

 


 

PROLOGIS

INDEX

 

 

 

 

 

Page

Number

 

PART I.

 

Financial Information

 

 

 

 

 

Item 1.

Financial Statements

 

1

 

 

 

            Prologis, Inc.:

 

 

 

 

 

 

Consolidated Balance Sheets – September 30, 2016, and December 31, 2015

 

1

 

 

 

 

Consolidated Statements of Income – Three and Nine Months Ended September 30, 2016, and 2015

 

2

 

 

 

 

Consolidated Statements of Comprehensive Income – Three and Nine Months Ended September 30, 2016, and 2015

 

3

 

 

 

 

Consolidated Statement of Equity – Nine Months Ended September 30, 2016

 

3

 

 

 

 

Consolidated Statements of Cash Flows – Nine Months Ended September 30, 2016, and 2015

 

4

 

 

 

            Prologis, L.P.:

 

 

 

 

 

 

Consolidated Balance Sheets – September 30, 2016, and December 31, 2015

 

5

 

 

 

 

Consolidated Statements of Income – Three and Nine Months Ended September 30, 2016, and 2015

 

6

 

 

 

 

Consolidated Statements of Comprehensive Income – Three and Nine Months Ended September 30, 2016, and 2015

 

7

 

 

 

 

Consolidated Statement of Capital – Nine Months Ended September 30, 2016

 

7

 

 

 

 

Consolidated Statements of Cash Flows – Nine Months Ended September 30, 2016, and 2015

 

8

 

 

 

            Prologis, Inc. and Prologis, L.P.:

 

 

 

 

 

 

Notes to the Consolidated Financial Statements

 

9

 

 

 

 

Note 1. General

 

9

 

 

 

 

Note 2. Business Combination

 

10

 

 

 

 

Note 3. Real Estate

 

11

 

 

 

 

Note 4. Unconsolidated Entities

 

12

 

 

 

 

Note 5. Assets Held for Sale or Contribution

 

16

 

 

 

 

Note 6. Notes Receivable Backed by Real Estate

 

16

 

 

 

 

Note 7. Debt

 

16

 

 

 

 

Note 8. Noncontrolling Interests

 

18

 

 

 

 

Note 9. Long-Term Compensation

 

19

 

 

 

 

Note 10. Earnings Per Common Share or Unit

 

20

 

 

 

 

Note 11. Financial Instruments and Fair Value Measurements

 

21

 

 

 

 

Note 12. Business Segments

 

25

 

 

 

 

Note 13. Supplemental Cash Flow Information

 

27

 

 

 

 

Reports of Independent Registered Public Accounting Firm

 

28

 

 

 

Item 2.

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

 

30

 

 

 

Item 3.

Quantitative and Qualitative Disclosures About Market Risk

 

49

 

 

 

Item 4.

Controls and Procedures

 

50

 

PART II.

 

Other Information

 

 

 

 

 

Item 1.

Legal Proceedings

 

51

 

 

 

Item 1A.

Risk Factors

 

51

 

 

 

Item 2.

Unregistered Sales of Equity Securities and Use of Proceeds

 

51

 

 

 

Item 3.

Defaults Upon Senior Securities

 

51

 

 

 

Item 4.

Mine Safety Disclosures

 

51

 

 

 

Item 5.

Other Information

 

51

 

 

 

Item 6.

Exhibits

 

51

 

 

 

 

 

 


 

PART I. FINANCIAL INFORMATION

 

ITEM 1. Financial Statements

 

PROLOGIS, INC.

CONSOLIDATED BALANCE SHEETS

(In thousands, except per share data)

 

 

September 30,

 

 

 

 

 

 

2016

 

 

December 31,

 

 

(Unaudited)

 

 

2015

 

ASSETS

 

 

 

 

 

 

 

Investments in real estate properties

$

27,570,704

 

 

$

27,521,368

 

Less accumulated depreciation

 

3,638,688

 

 

 

3,274,284

 

Net investments in real estate properties

 

23,932,016

 

 

 

24,247,084

 

Investments in and advances to unconsolidated entities

 

4,580,584

 

 

 

4,755,620

 

Assets held for sale or contribution

 

450,349

 

 

 

378,423

 

Notes receivable backed by real estate

 

33,800

 

 

 

235,050

 

Net investments in real estate

 

28,996,749

 

 

 

29,616,177

 

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

375,120

 

 

 

264,080

 

Other assets

 

1,516,340

 

 

 

1,514,510

 

Total assets

$

30,888,209

 

 

$

31,394,767

 

 

 

 

 

 

 

 

 

LIABILITIES AND EQUITY

 

 

 

 

 

 

 

Liabilities:

 

 

 

 

 

 

 

Debt

$

11,256,997

 

 

$

11,626,831

 

Accounts payable and accrued expenses

 

672,111

 

 

 

712,725

 

Other liabilities

 

675,831

 

 

 

634,375

 

Total liabilities

 

12,604,939

 

 

 

12,973,931

 

 

 

 

 

 

 

 

 

Equity:

 

 

 

 

 

 

 

Prologis, Inc. stockholders’ equity:

 

 

 

 

 

 

 

Series Q preferred stock at stated liquidation preference of $50 per share: $0.01 par value; 1,565 shares

     issued and outstanding and 100,000 preferred shares authorized at September 30, 2016, and

         December 31, 2015

 

78,235

 

 

 

78,235

 

Common stock: $0.01 par value; 528,599 shares and 524,512 shares issued and outstanding at

     September 30, 2016, and December 31, 2015, respectively

 

5,286

 

 

 

5,245

 

Additional paid-in capital

 

19,433,001

 

 

 

19,302,367

 

Accumulated other comprehensive loss

 

(889,223

)

 

 

(791,429

)

Distributions in excess of net earnings

 

(3,828,132

)

 

 

(3,926,483

)

Total Prologis, Inc. stockholders’ equity

 

14,799,167

 

 

 

14,667,935

 

Noncontrolling interests

 

3,484,103

 

 

 

3,752,901

 

Total equity

 

18,283,270

 

 

 

18,420,836

 

Total liabilities and equity

$

30,888,209

 

 

$

31,394,767

 

 

The accompanying notes are an integral part of these Consolidated Financial Statements.

 

 

 

1

 


 

PROLOGIS, INC.

CONSOLIDATED STATEMENTS OF INCOME

(Unaudited)

(In thousands, except per share amounts)

 

 

 

Three Months Ended

 

 

Nine Months Ended

 

 

 

September 30,

 

 

September 30,

 

 

 

2016

 

 

2015

 

 

2016

 

 

2015

 

Revenues:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Rental

 

$

435,868

 

 

$

418,116

 

 

$

1,299,122

 

 

$

1,100,491

 

Rental recoveries

 

 

124,409

 

 

 

114,639

 

 

 

361,402

 

 

 

312,510

 

Strategic capital

 

 

140,577

 

 

 

44,176

 

 

 

241,565

 

 

 

133,247

 

Development management and other

 

 

3,711

 

 

 

3,691

 

 

 

10,931

 

 

 

7,625

 

Total revenues

 

 

704,565

 

 

 

580,622

 

 

 

1,913,020

 

 

 

1,553,873

 

Expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Rental

 

 

140,514

 

 

 

140,284

 

 

 

427,820

 

 

 

393,199

 

Strategic capital

 

 

44,624

 

 

 

26,532

 

 

 

97,783

 

 

 

76,661

 

General and administrative

 

 

58,157

 

 

 

54,178

 

 

 

165,634

 

 

 

157,458

 

Depreciation and amortization

 

 

224,867

 

 

 

247,471

 

 

 

705,249

 

 

 

607,467

 

Other

 

 

3,779

 

 

 

8,765

 

 

 

12,364

 

 

 

44,467

 

Total expenses

 

 

471,941

 

 

 

477,230

 

 

 

1,408,850

 

 

 

1,279,252

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating income

 

 

232,624

 

 

 

103,392

 

 

 

504,170

 

 

 

274,621

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other income (expense):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Earnings from unconsolidated entities, net

 

 

45,857

 

 

 

33,557

 

 

 

145,622

 

 

 

106,383

 

Interest expense

 

 

(75,310

)

 

 

(81,035

)

 

 

(232,577

)

 

 

(218,698

)

Interest and other income, net

 

 

2,932

 

 

 

6,237

 

 

 

7,051

 

 

 

19,133

 

Gains on dispositions of investments in real estate, net

 

 

117,296

 

 

 

268,791

 

 

 

461,963

 

 

 

655,288

 

Foreign currency and derivative losses, net

 

 

(1,730

)

 

 

(9,428

)

 

 

(26,277

)

 

 

(374

)

Gains (losses) on early extinguishment of debt, net

 

 

1,492

 

 

 

-

 

 

 

2,484

 

 

 

(16,525

)

Total other income

 

 

90,537

 

 

 

218,122

 

 

 

358,266

 

 

 

545,207

 

Earnings before income taxes

 

 

323,161

 

 

 

321,514

 

 

 

862,436

 

 

 

819,828

 

Total income tax expense

 

 

15,919

 

 

 

14,328

 

 

 

36,598

 

 

 

21,070

 

Consolidated net earnings

 

 

307,242

 

 

 

307,186

 

 

 

825,838

 

 

 

798,758

 

Less net earnings attributable to noncontrolling interests

 

 

26,316

 

 

 

46,536

 

 

 

58,103

 

 

 

49,314

 

Net earnings attributable to controlling interests

 

 

280,926

 

 

 

260,650

 

 

 

767,735

 

 

 

749,444

 

Less preferred stock dividends

 

 

1,671

 

 

 

1,671

 

 

 

5,056

 

 

 

5,019

 

Net earnings attributable to common stockholders

 

$

279,255

 

 

$

258,979

 

 

$

762,679

 

 

$

744,425

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average common shares outstanding – Basic

 

 

527,288

 

 

 

523,528

 

 

 

525,462

 

 

 

520,388

 

Weighted average common shares outstanding – Diluted

 

 

547,200

 

 

 

532,073

 

 

 

545,228

 

 

 

531,121

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net earnings per share attributable to common stockholders – Basic

 

$

0.53

 

 

$

0.49

 

 

$

1.45

 

 

$

1.43

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net earnings per share attributable to common stockholders – Diluted

 

$

0.52

 

 

$

0.49

 

 

$

1.44

 

 

$

1.41

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Dividends per common share

 

$

0.42

 

 

$

0.40

 

 

$

1.26

 

 

$

1.12

 

 

The accompanying notes are an integral part of these Consolidated Financial Statements.

 

 

 

2

 


 

PROLOGIS, INC.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(Unaudited)

(In thousands)

 

  

 

Three Months Ended

 

 

Nine Months Ended

 

 

 

September 30,

 

 

September 30,

 

 

 

2016

 

 

2015

 

 

2016

 

 

2015

 

Consolidated net earnings

 

$

307,242

 

 

$

307,186

 

 

$

825,838

 

 

$

798,758

 

Other comprehensive income (loss):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Foreign currency translation losses, net

 

 

(48,232

)

 

 

(148,570

)

 

 

(69,832

)

 

 

(197,912

)

Unrealized gains (losses) on derivative contracts, net

 

 

4,696

 

 

 

(15,660

)

 

 

(17,122

)

 

 

(12,313

)

Comprehensive income

 

 

263,706

 

 

 

142,956

 

 

 

738,884

 

 

 

588,533

 

Net earnings attributable to noncontrolling interests

 

 

(26,316

)

 

 

(46,536

)

 

 

(58,103

)

 

 

(49,314

)

Other comprehensive loss (income) attributable to noncontrolling interest

 

 

2,392

 

 

 

18,925

 

 

 

(10,840

)

 

 

33,992

 

Comprehensive income attributable to common stockholders

 

$

239,782

 

 

$

115,345

 

 

$

669,941

 

 

$

573,211

 

 

The accompanying notes are an integral part of these Consolidated Financial Statements.

 

 

 

PROLOGIS, INC.

CONSOLIDATED STATEMENT OF EQUITY

Nine Months Ended September 30, 2016

(Unaudited)

(In thousands)

 

 

 

 

 

 

 

Common Stock

 

 

 

 

 

 

Accumulated

 

 

Distributions

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Number

 

 

 

 

 

 

Additional

 

 

Other

 

 

in Excess of

 

 

Non-

 

 

 

 

 

 

 

Preferred

 

 

of

 

 

Par

 

 

Paid-in

 

 

Comprehensive

 

 

Net

 

 

controlling

 

 

Total

 

 

 

Stock

 

 

Shares

 

 

Value

 

 

Capital

 

 

Loss

 

 

Earnings

 

 

Interests

 

 

Equity

 

Balance at January 1, 2016

 

$

78,235

 

 

 

524,512

 

 

$

5,245

 

 

$

19,302,367

 

 

$

(791,429

)

 

$

(3,926,483

)

 

$

3,752,901

 

 

$

18,420,836

 

Consolidated net earnings

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

767,735

 

 

 

58,103

 

 

 

825,838

 

Effect of equity compensation

     plans

 

 

-

 

 

 

2,220

 

 

 

22

 

 

 

75,258

 

 

 

-

 

 

 

-

 

 

 

18,771

 

 

 

94,051

 

Issuance of units related to

     acquisitions

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

3,162

 

 

 

3,162

 

Settlement of noncontrolling

     interests

 

 

-

 

 

 

-

 

 

 

-

 

 

 

851

 

 

 

-

 

 

 

-

 

 

 

(2,979

)

 

 

(2,128

)

Conversion of noncontrolling

      interests

 

 

-

 

 

 

1,867

 

 

 

19

 

 

 

51,931

 

 

 

-

 

 

 

-

 

 

 

(51,950

)

 

 

-

 

Capital contributions

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

1,026

 

 

 

1,026

 

Foreign currency translation

     gains (losses), net

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(81,115

)

 

 

-

 

 

 

11,283

 

 

 

(69,832

)

Unrealized losses on derivative

     contracts, net

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(16,679

)

 

 

-

 

 

 

(443

)

 

 

(17,122

)

Reallocation of equity

 

 

-

 

 

 

-

 

 

 

-

 

 

 

2,770

 

 

 

-

 

 

 

-

 

 

 

(2,770

)

 

 

-

 

Distributions and other

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(176

)

 

 

-

 

 

 

(669,384

)

 

 

(303,001

)

 

 

(972,561

)

Balance at September 30, 2016

 

$

78,235

 

 

 

528,599

 

 

$

5,286

 

 

$

19,433,001

 

 

$

(889,223

)

 

$

(3,828,132

)

 

$

3,484,103

 

 

$

18,283,270

 

 

The accompanying notes are an integral part of these Consolidated Financial Statements.

 

 

 

3

 


 

PROLOGIS, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

(In thousands)

 

 

 

Nine Months Ended

 

 

 

September 30,

 

 

 

2016

 

 

2015

 

Operating activities:

 

 

 

 

 

 

 

 

Consolidated net earnings

 

$

825,838

 

 

$

798,758

 

Adjustments to reconcile net earnings to net cash provided by operating activities:

 

 

 

 

 

 

 

 

Straight-lined rents and amortization of above and below market leases

 

 

(74,664

)

 

 

(37,537

)

Equity-based compensation awards

 

 

43,658

 

 

 

40,124

 

Depreciation and amortization

 

 

705,249

 

 

 

607,467

 

Earnings from unconsolidated entities, net

 

 

(145,622

)

 

 

(106,383

)

Distributions from unconsolidated entities

 

 

210,439

 

 

 

205,931

 

Net changes in operating receivables from unconsolidated entities

 

 

(56,992

)

 

 

(20,153

)

Amortization of debt premiums, net of deferred financing costs

 

 

(13,047

)

 

 

(22,271

)

Gains on dispositions of investments in real estate, net

 

 

(461,963

)

 

 

(655,288

)

Unrealized foreign currency and derivative losses, net

 

 

21,266

 

 

 

6,931

 

Losses (gains) on early extinguishment of debt, net

 

 

(2,484

)

 

 

16,525

 

Deferred income tax benefit

 

 

(1,737

)

 

 

(1,758

)

Increase in accounts receivable and other assets

 

 

(48,231

)

 

 

(68,243

)

Decrease in accounts payable and accrued expenses and other liabilities

 

 

(4,699

)

 

 

(7,546

)

Net cash provided by operating activities

 

 

997,011

 

 

 

756,557

 

Investing activities:

 

 

 

 

 

 

 

 

Real estate development

 

 

(1,225,613

)

 

 

(950,199

)

Real estate acquisitions

 

 

(280,797

)

 

 

(571,368

)

KTR acquisition, net of cash received

 

 

-

 

 

 

(4,809,499

)

Tenant improvements and lease commissions on previously leased space

 

 

(125,041

)

 

 

(108,662

)

Nondevelopment capital expenditures

 

 

(66,298

)

 

 

(51,374

)

Proceeds from dispositions and contributions of real estate properties

 

 

1,859,317

 

 

 

1,814,532

 

Investments in and advances to unconsolidated entities

 

 

(228,588

)

 

 

(438,964

)

Return of investment from unconsolidated entities

 

 

579,134

 

 

 

14,909

 

Proceeds from repayment of notes receivable backed by real estate

 

 

201,250

 

 

 

9,866

 

Proceeds from the settlement of net investment hedges

 

 

16,768

 

 

 

122,505

 

Payments on the settlement of net investment hedges

 

 

-

 

 

 

(981

)

Net cash provided by (used in) investing activities

 

 

730,132

 

 

 

(4,969,235

)

Financing activities:

 

 

 

 

 

 

 

 

Proceeds from issuance of common stock

 

 

38,101

 

 

 

84,112

 

Dividends paid on common and preferred stock

 

 

(669,384

)

 

 

(592,795

)

Noncontrolling interests contributions

 

 

1,026

 

 

 

2,354,468

 

Noncontrolling interests distributions

 

 

(301,268

)

 

 

(157,517

)

Purchase of noncontrolling interests

 

 

(2,979

)

 

 

(2,560

)

Tax paid for shares withheld

 

 

(7,862

)

 

 

(12,292

)

Debt and equity issuance costs paid

 

 

(19,265

)

 

 

(18,476

)

Net proceeds from (payments on) credit facilities

 

 

(3,545

)

 

 

199,958

 

Repurchase and payments of debt

 

 

(1,675,818

)

 

 

(913,178

)

Proceeds from issuance of debt

 

 

1,012,331

 

 

 

3,239,261

 

Net cash provided by (used in) financing activities

 

 

(1,628,663

)

 

 

4,180,981

 

 

 

 

 

 

 

 

 

 

Effect of foreign currency exchange rate changes on cash

 

 

12,560

 

 

 

(8,562

)

Net increase in cash and cash equivalents

 

 

111,040

 

 

 

(40,259

)

Cash and cash equivalents, beginning of period

 

 

264,080

 

 

 

350,692

 

Cash and cash equivalents, end of period

 

$

375,120

 

 

$

310,433

 

 

See Note 13 for information on noncash investing and financing activities and other information.

The accompanying notes are an integral part of these Consolidated Financial Statements.

 

 

4

 


 

PROLOGIS, L.P.

CONSOLIDATED BALANCE SHEETS

(In thousands)

 

 

September 30,

 

 

 

 

 

 

2016

 

 

December 31,

 

 

(Unaudited)

 

 

2015

 

ASSETS

 

 

 

 

 

 

 

Investments in real estate properties

$

27,570,704

 

 

$

27,521,368

 

Less accumulated depreciation

 

3,638,688

 

 

 

3,274,284

 

Net investments in real estate properties

 

23,932,016

 

 

 

24,247,084

 

Investments in and advances to unconsolidated entities

 

4,580,584

 

 

 

4,755,620

 

Assets held for sale or contribution

 

450,349

 

 

 

378,423

 

Notes receivable backed by real estate

 

33,800

 

 

 

235,050

 

Net investments in real estate

 

28,996,749

 

 

 

29,616,177

 

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

375,120