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Prologis Buys KTR for $6B

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Prologis CEO Hamid Moghadam at REITWeek in 2014

The industrial world got shaken up this morning—Prologis signed a definitive agreement to purchase KTR Capital Partners and its affiliates. The $6B deal puts 60M SF under Prologis’ control. They’ll be owned by Prologis US Logistics Venture, a JV with Norges Bank Investment Management that will now consist of $11B across two continents. Prologis CEO Hamid Moghadam (pictured at REITWeek 2014) says KTR was one of his toughest competitors (if you can’t beat them, buy them); he’s known the KTR leadership for 15 years and liked the similarities in their market composition and asset quality.

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The acquired portfolio—322 properties primarily in Southern California, New Jersey, Chicago, South Florida, Seattle and Dallas—includes 3.6M SF of development in progress and a land bank with a build-out potential of 6.8M SF. The transaction is expected to close in the next 30 to 60 days. Prologis had already started the year strong, with 96% overall occupancy in Q1, a 140 bps increase over Q1 ’14. Rents were up nearly 10%, including a 15% increase in its US portfolio. Pictured: Hamid with fellow Prologis execs Gene Reilly and Tom Olinger, and former CEO Walt Rakowich