| Noncontrolling Interests |
| 13. |
Noncontrolling Interests: |
Operating Partnership
We report noncontrolling interest related to several entities we consolidate but do not own 100% of the common equity. These entities include three real
estate partnerships that have issued limited partnership units to third parties. Depending on the specific partnership agreements, these limited partnership units are exchangeable into shares of our common stock, generally at a rate of one share of
common stock to one unit or into cash. We evaluated the noncontrolling interests with redemption provisions that permit the issuer to settle in either cash or common stock at the option of the issuer to determine whether temporary or permanent
equity classification on the balance sheet is appropriate, including the requirement to settle in unregistered shares, and determined that these units meet the requirements to qualify for presentation as permanent equity.
We also consolidate several entities in which we do not own 100% but that are not exchangeable into our common stock. If we contribute a property to a
consolidated co-investment venture, the property is still reflected in our Consolidated Financial Statements, but due to our ownership of less than 100%, there is an increase in noncontrolling interest related to the contributed properties, which
represents the cash we receive from our partners.
REIT
The noncontrolling interest of the REIT includes the noncontrolling interests presented in the Operating Partnership, as well as the common limited
partnership units in the Operating Partnership that are not owned by the REIT. As of December 31, 2011, the REIT owned 99.55% of the common partnership units of the Operating Partnership.
The following is a summary of the noncontrolling interest and the consolidated co-investment ventures’ total investment in real estate and debt at December 31(dollars in thousands):
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00000 |
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00000 |
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00000 |
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00000 |
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00000 |
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00000 |
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00000 |
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REIT’s
Ownership
Percentage |
|
|
Noncontrolling Interest |
|
|
Total Investment
In
Real Estate |
|
|
Debt |
|
| |
|
2011 |
|
|
2011 |
|
|
2010 |
|
|
2011 |
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|
2010 |
|
|
2011 |
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|
2010 |
|
|
Partnerships with exchangeable units (1)
|
|
|
various |
|
|
$ |
11,173 |
|
|
$ |
11,189 |
|
|
$ |
297,591 |
|
|
$ |
293,632 |
|
|
$ |
26,417 |
|
|
$ |
26,417 |
|
|
Prologis Institutional Alliance Fund II (2)
|
|
|
24.1 |
% |
|
|
324,721 |
|
|
|
- |
|
|
|
624,318 |
|
|
|
- |
|
|
|
220,625 |
|
|
|
- |
|
|
PEPR (3)
|
|
|
93.7 |
% |
|
|
106,759 |
|
|
|
- |
|
|
|
4,047,329 |
|
|
|
- |
|
|
|
1,699,587 |
|
|
|
- |
|
|
Mexico Fondo Logistico (AFORES)(2)(4)
|
|
|
20.0 |
% |
|
|
118,580 |
|
|
|
- |
|
|
|
312,914 |
|
|
|
- |
|
|
|
177,000 |
|
|
|
- |
|
|
Prologis AMS (2)
|
|
|
38.6 |
% |
|
|
83,897 |
|
|
|
- |
|
|
|
211,627 |
|
|
|
- |
|
|
|
77,041 |
|
|
|
- |
|
|
Other consolidated entities (2)
|
|
|
various |
|
|
|
90,092 |
|
|
|
3,943 |
|
|
|
620,052 |
|
|
|
58,665 |
|
|
|
70,140 |
|
|
|
- |
|
| |
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|
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|
|
|
|
|
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|
|
Operating Partnership noncontrolling interests
|
|
|
|
|
|
|
735,222 |
|
|
|
15,132 |
|
|
|
6,113,831 |
|
|
|
352,297 |
|
|
|
2,270,810 |
|
|
|
26,417 |
|
|
Limited partners in the Operating Partnership (5)
|
|
|
|
|
|
|
58,613 |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
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|
- |
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| |
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|
|
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|
|
|
|
|
|
|
|
REIT noncontrolling interests
|
|
|
|
|
|
$ |
793,835 |
|
|
$ |
15,132 |
|
|
$ |
6,113,831 |
|
|
$ |
352,297 |
|
|
$ |
2,270,810 |
|
|
$ |
26,417 |
|
| (1) |
At December 31, 2011 and 2010, there were 1,302,238 and 339,225 limited partnership units, respectively, that were exchangeable into an equal number of shares of
the REIT’s common stock. In 2011, no outstanding limited partnership units were exchanged. In 2010, 22,432 limited partnership units were exchanged into an equal number of shares of the REIT’s common stock. The majority of the outstanding
limited partnership units are entitled to quarterly cash distributions equal to the quarterly dividends paid on our common stock. |
| (2) |
Relates to the consolidated investees that were acquired as a result of the Merger. |
| (3) |
In 2011, we acquired a controlling interest and began consolidating PEPR. For more information on this acquisition see Note 3. |
| (4) |
In the fourth quarter of 2011, we contributed 18 properties aggregating 4.2 million square feet to this consolidated entity for $234.4 million. As this entity is
consolidated, we did not record a gain on this transaction. In addition, NAIF II sold eight properties aggregating 1.2 million square feet for $58.5 million to this same consolidated entity (see Note 6 for more detail on the NAIF II
transaction). As a result of these transactions, the noncontrolling interest has increased $106.7 million, which represents our partners’ investment in cash. |
| (5) |
Relates to the limited partners in the Operating Partnership that were acquired as a result of the Merger. At December 31, 2011, 2,058,730 units are associated
with the common limited partners in the Operating Partnership that are exchangeable into an equal number of shares of the REIT’s common stock. The majority of the outstanding limited partnership units are entitled to quarterly cash
distributions equal to the quarterly distributions paid on our common stock. |
|