ProLogis Signs Development Portfolio Alliance with Japan Logistics Fund

ProLogis has entered into an alliance with Japan Logistics Fund (JLF) and Mitsui & Co, Logistics Partners, related to the acquisition of properties from ProLogis' Japan development portfolio.

In November 2008, the former outlined a series of immediate, definitive actions to strengthen its balance sheet and reduce risk given global financial market conditions. To reduce risk in the company's development portfolio in Japan, the company plans to own and manage some of its distribution facilities with joint venture partners and will retain other assets on its balance sheet.

Additionally, the former has been working with strategic partners to jointly develop new facilities on its land bank in Japan.

The former’s strategy to align with joint venture partners fits well with JLF's objective of expanding its portfolio through external growth opportunities that provide long-term ownership of state-of-the-art distribution facilities. It is anticipated that some of the distribution facilities ProLogis currently owns, and will develop, in Japan will be jointly owned by both parties.

Moreover, through this joint ownership structure, ProLogis would continue managing and leasing the properties, earning management fees related to those services.

The distribution facilities to be jointly owned by the two companies will be determined after both parties conclude a formal agreement, under which ProLogis may also provide JLF with continued investment opportunities.

In addition, ProLogis is currently in discussions regarding a possible joint development partnership agreement with the Mitsui & Co Group, which holds a controlling interest in the asset management company of JLF.

ProLogis, www.prologis.com