Prologis Sells U.S. Industrial Assets - Analyst Blog

United States opened the 2014 FIFA World Cup on a high note with the Ghana defeat and is gearing up to confront Portugal in its upcoming match. However, Prologis Inc. PLD is reducing its presence in the country with the industrial portfolio sale.

In particular, Prologis offloaded a 59-assets industrial portfolio, spanning 7.5 million square foot, in the U.S. to a Dallas-based private investment company – TPG. As per The Dallas Morning News, the purchaser paid $375 million for the transaction. The properties are situated across 9 U.S. markets – Seattle, El Paso, Cincinnati, Dallas, Chicago, Denver, Portland, Los Angeles and Columbus.

Prologis specializes in industrial distribution warehouse space in some of the busiest distribution markets across the globe. As a matter of fact, amid a larger customer base, rise in e-Commerce application and supply chain consolidation, there is an increasing demand for high-quality logistics facilities. This leading industrial real estate investment trust (REIT) stands to benefit as it has the capacity to offer modern distribution facilities in strategic infill locations globally.

Consequently, the company is significantly repositioning its portfolio through divestitures, acquisitions, build-to-suit development projects and lease deals across the globe. Last week, Prologis completed the initial public offering and listing of its Mexican REIT – FIBRA Prologis FIBRAPL to boost its presence in the region (read: Prologis Sets Up Mexican REIT, Shares Gain). We expect such moves to fuel the company's capital recycling activity, enhance portfolio quality and ride on the growth trajectory.

Prologis currently carries a Zacks Rank #3 (Hold). Investors interested in the REIT industry may consider stocks like The GEO Group, Inc. GEO, Terreno Realty Corp. TRNO and Chatham Lodging Trust CLDT. All these stocks sport a Zacks Rank #1 (Strong Buy).

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