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UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K

(Mark One)

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

For the fiscal year ended December 31, 2014

or

¨ | 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

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

|  | Title of Each Class |  | Name of Each Exchange on Which Registered
Prologis, Inc. |  | Common Stock, $.01 par value |  | New York Stock Exchange
Prologis, L.P. |  | 4.000% Notes due 2018 |  | New York Stock Exchange
Prologis, L.P. |  | 1.375% Notes due 2020 |  | New York Stock Exchange
Prologis, L.P. |  | 3.000% Notes due 2022 |  | New York Stock Exchange
Prologis, L.P. |  | 3.375% Notes due 2024 |  | New York Stock Exchange

Securities registered pursuant to Section 12(g) of the Act:

Prologis, Inc. - NONE

Prologis, L.P. - NONE

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.

Prologis, Inc.: Yes þ No ¨ Prologis, L.P.: Yes þ No ¨

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act.

Prologis, Inc.: Yes ¨ No þ Prologis, L.P.: Yes ¨ No þ

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 requirements for the past 90 days. Prologis, Inc.: Yes þ No ¨ Prologis, L.P.: Yes þ 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 during the preceding 12 months (or for such shorter periods that the registrant was required to submit and post such files). Prologis, Inc.: Yes þ No ¨ Prologis, L.P.: Yes þ No ¨

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. þ

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 the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act (check one):

Prologis, Inc.: |  | þ Large accelerated filer |  | ¨ Accelerated filer
|  | ¨ Non-accelerated filer (do not check if a smaller reporting company) |  | ¨ Smaller reporting company

Prologis, L.P.: |  | ¨ Large accelerated filer |  | ¨ Accelerated filer
|  | þ Non-accelerated filer (do not check if a smaller reporting company) |  | ¨ 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 þ Prologis, L.P.: Yes ¨ No þ

Based on the closing price of Prologis, Inc.’s common stock on June 30, 2014, the aggregate market value of the voting common equity held by non-affiliates of Prologis, Inc. was $20,348,477,088.

The number of shares of Prologis, Inc.’s common stock outstanding at February 20, 2015, was approximately 512,138,000

.

DOCUMENTS INCORPORATED BY REFERENCE

Portions of Part III of this report are incorporated by reference to the registrant’s definitive proxy statement for the 2015 annual meeting of its stockholders or will be provided in an amendment filed on Form 10-K/A.

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EXPLANATORY NOTE

This report combines the annual reports on Form 10-K for the year ended December 31, 2014, 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 (a “REIT”) and the general partner of the Operating Partnership. At December 31, 2014, Prologis, Inc. owned an approximate 99.65% common general partnership interest in the Operating Partnership and 100% of the preferred units in the Operating Partnership. The remaining approximate 0.35% common limited partnership interests are owned by non-affiliated investors and certain current and former directors and officers of Prologis, Inc. As the sole general partner of the Operating Partnership, Prologis, Inc. has full, exclusive and 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. Since 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 the combined annual report on Form 10-K 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.

We believe 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 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 financial statements include the interests in consolidated entities not owned by the Operating Partnership. The noncontrolling interests in Prologis, Inc.’s 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.

In order to highlight the differences between Prologis, Inc. and the Operating Partnership, there are separate sections in this report, as applicable, that separately 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.

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TABLE OF CONTENTS

Item |  | Description |  | Page |
|  | PART I |  |  |  |
1. |  | Business |  |  | 4 |
|  | The Company |  |  | 4 |
|  | Investment Strategy |  |  | 5 |
|  | Business Strategy and Operating Segments |  |  | 5 |
|  | Code of Ethics and Business Conduct |  |  | 6 |
|  | Environmental Matters |  |  | 6 |
|  | Insurance Coverage |  |  | 7 |
1A. |  | Risk Factors |  |  | 7 |
1B. |  | Unresolved Staff Comments |  |  | 14 |
2. |  | Properties |  |  | 14 |
|  | Geographic Distribution |  |  | 14 |
|  | Lease Expirations |  |  | 17 |
|  | Unconsolidated Co-Investment Ventures |  |  | 18 |
3. |  | Legal Proceedings |  |  | 18 |
4. |  | Mine Safety Disclosures |  |  | 18 |
|  | PART II |  |  |  |
5. |  | Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities |  |  | 19 |
|  | Market Information and Holders |  |  | 19 |
|  | Preferred Stock Dividends |  |  | 20 |
|  | Securities Authorized for Issuance Under Equity Compensation Plans |  |  | 20 |
|  | Other Stockholder Matters |  |  | 21 |
6. |  | Selected Financial Data |  |  | 21 |
7. |  | Management’s Discussion and Analysis of Financial Condition and Results of Operations |  |  | 22 |
|  | Management’s Overview |  |  | 22 |
|  | Results of Operations |  |  | 23 |
|  | Environmental Matters |  |  | 30 |
|  | Liquidity and Capital Resources |  |  | 31 |
|  | Off-Balance Sheet Arrangements |  |  | 34 |
|  | Contractual Obligations |  |  | 34 |
|  | Critical Accounting Policies |  |  | 35 |
|  | New Accounting Pronouncements |  |  | 37 |
|  | Funds from Operations (“FFO”) |  |  | 37 |
7A. |  | Quantitative and Qualitative Disclosure About Market Risk |  |  | 40 |
8. |  | Financial Statements and Supplementary Data |  |  | 41 |
9. |  | Changes in and Disagreements with Accountants on Accounting and Financial Disclosure |  |  | 41 |
9A. |  | Controls and Procedures |  |  | 41 |
9B. |  | Other Information |  |  | 42 |
|  | PART III |  |  |  |
10. |  | Directors, Executive Officers and Corporate Governance |  |  | 42 |
11. |  | Executive Compensation |  |  | 42 |
12. |  | Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters |  |  | 42 |
13. |  | Certain Relationships and Related Transactions, and Director Independence |  |  | 42 |
14. |  | Principal Accounting Fees and Services |  |  | 43 |
|  | PART IV |  |  |  |
15. |  | Exhibits, Financial Statement Schedules |  |  | 43 |

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The statements in this report that are not historical facts are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements are based on current expectations, estimates and projections about the industry and markets in which we operate, management’s beliefs and assumptions made by management. Such statements involve uncertainties that could significantly impact our financial results. Words such as “expects,” “anticipates,” “intends,” “plans,” “believes,” “seeks,” “estimates,” variations of such words and similar expressions are intended to identify such forward-looking statements, which generally are not historical in nature. All statements that address operating performance, events or developments that we expect or anticipate will occur in the future — including statements relating to rent and occupancy growth, development activity and changes in sales or contribution volume of properties, disposition activity, general conditions in the geographic areas where we operate, our debt, capital structure and financial position, our ability to form new co-investment ventures and the availability of capital in existing or new co-investment ventures — are forward-looking statements. These statements are not guarantees of future performance and involve certain risks, uncertainties and assumptions that are difficult to predict. Although we believe the expectations reflected in any forward-looking statements are based on reasonable assumptions, we can give no assurance that our expectations will be attained, and therefore actual outcomes and results may differ materially from what is expressed or forecasted in such forward-looking statements. Some of the factors that may affect outcomes and results include, but are not limited to: (i) national, international, regional and local economic climates, (ii) changes in financial markets, interest rates and foreign currency exchange rates, (iii) increased or unanticipated competition for our properties, (iv) risks associated with acquisitions, dispositions and development of properties, (v) maintenance of REIT status and tax structuring, (vi) availability of financing and capital, the levels of debt that we maintain and our credit ratings, (vii) risks related to our investments in our co-investment ventures, including our ability to establish new co-investment ventures, (viii) risks of doing business internationally, including currency risks, (ix) environmental uncertainties, including risks of natural disasters, and (x) those additional factors discussed under Item 1A. Risk Factors in this report. We undertake no duty to update any forward-looking statements appearing in this report except as may be required by law.

PART I

ITEM 1. Business

The Company

We are the global leader in industrial real estate, focused on markets across the Americas, Europe and Asia. At December 31, 2014, we owned or had investments in, on a wholly-owned basis or through co-investment ventures, properties and development projects expected to total approximately 590 million square feet (55 million square meters) in 21 countries. We lease modern distribution facilities to more than 4,700 customers, including third-party logistics providers, transportation companies, retailers and manufacturers.

Details of the 590 million square feet, which represents an expected investment on an owned and managed basis of $45.6 billion, were as follows:

| • |  | 537 million square feet were in our operating portfolio with a gross book value of $40.6 billion and 96.1% occupancy;

| • |  | 40 million square feet were in our development portfolio with a total expected investment of $3.2 billion that were 40.9% leased;

| • |  | $1.8 billion of land was available for future development;

| • |  | 13 million square feet consisted of valued added properties, properties in which we have an ownership interest but do not manage and other non-industrial properties we own; and

| • |  | 2.1% and 18.6% of the annualized net effective rent were attributable to our largest customer and 25 largest customers, respectively.

Prologis, Inc. began operating as a fully integrated real estate company in 1997 and elected to be taxed as a REIT under the Internal Revenue Code of 1986, as amended (“Internal Revenue Code”). We believe the current organization and method of operation will enable Prologis, Inc. to maintain its status as a REIT. The Operating Partnership also was formed in 1997.

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Our global corporate headquarters are at Pier 1, Bay 1, San Francisco, California 94111, and our global operational headquarters are at 4545 Airport Way, Denver, Colorado 80239. Other principal offices are in Amsterdam, Luxembourg, Mexico City, Sao Paulo, Shanghai, Singapore and Tokyo.

Our Internet address is www.prologis.com. All reports required to be filed with the Securities and Exchange Commission (“SEC”) are available or can be accessed free of charge through the Investor Relations section of our website after we electronically submit material to the SEC. The common stock of Prologis, Inc. is listed on the New York Stock Exchange (“NYSE”) under the ticker “PLD” and is a component of the Standard & Poors (“S&P”) 500.

Investment Strategy

Both macroeconomics and demographics are important drivers of our business, including population growth, consumption and rising affluence. In developed markets, including in the U.S., Europe and Japan, the reconfiguration of supply chains, and the operational efficiencies that can be realized from our modern logistics facilities, are an important driver. In emerging markets, such as Mexico, Brazil and China, increases in affluence and the rise of consumer classes create demand as new supply chains are constructed. Taken together, logistics real estate markets benefit from economic growth, but depend to a greater degree upon the modernization of supply chains around the world and demographic growth.

We have investments in entities through a variety of ventures. We co-invest with partners and investors in entities that own multiple properties and provide asset and property management services to these entities. We refer to these entities as co-investment ventures. These entities may be consolidated or unconsolidated, depending on the structure, our partners’ participating and other rights and our level of control. The co-investment ventures may have one or more investors.

Our investment strategy focuses on providing distribution facilities to customers whose businesses are tied to global trade and depend on the efficient movement of goods through the global supply chain. We have a deep worldwide presence of $45.6 billion (based on expected investment) in our owned and managed portfolio spanning 21 countries on four continents. We classify our properties into two main market categories: global and regional. Global markets comprise approximately 30 of the largest markets tied to global trade. They feature large population centers with high per-capita consumption rates and are near major airports, seaports and ground transportation systems. Regional markets benefit from large population centers but typically are not as tied to the global supply chain; instead, they serve local consumption and are less supply constrained. We intend to hold primarily Class-A product in our global and regional markets. At December 31, 2014, global and regional markets represented approximately 86% and 13%, respectively, of our owned and managed portfolio (based on our share of the properties’ gross book value). We also have a small investment in other markets that accounts for approximately 1% of our owned and managed portfolio. We have deep knowledge of our local markets, construction expertise and a commitment to sustainable design across our portfolio. We are supported by a broad and diverse customer base and have relationships with multinational corporations that bring us repeat business across our portfolio. For more detail on our properties, see Item 2. Properties.

Business Strategy and Operating Segments

Our business comprises two operating segments: Real Estate Operations and Strategic Capital.

Real Estate Operations

Rental Operations. Rental operations represent the main source of our revenues, earnings and funds from operations (“FFO”). See definition and a complete reconciliation of net earnings to FFO in Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations. We collect rent from our customers through operating leases, including reimbursements for the majority of our operating costs. We expect to generate long-term internal growth in rental income by maintaining high occupancy rates, controlling expenses and through rent increases. Our rental income is diversified due to our global presence and broad customer base. We believe our property management, leasing and maintenance teams, together with our capital expenditure, energy management and risk management programs, create cost efficiencies that allow us to capitalize on the economies of scale inherent in owning, operating and growing a global portfolio.

Capital Deployment. Capital deployment includes the development, re-development and acquisition of industrial properties that lead to rental operations and is therefore included with rental operations for segment reporting. We deploy capital primarily in global and regional markets to meet our customers’ needs. We capitalize on the following: (i) our land bank; (ii) the development expertise of our local teams; (iii) our global customer relationships; and (iv) the demand for high-quality distribution facilities. We aim to increase our rental income and the Company’s net asset value by leasing newly developed space and acquiring operating properties. We develop properties for long-term hold, for contribution to our co-investment ventures and, occasionally, for sale to third parties.

Strategic Capital

We invest with partners and investors through private and public ventures which may be consolidated or unconsolidated. We tailor industrial portfolios to investors’ specific needs, with a focus on long-term ventures and open-ended funds. We also access alternative sources of equity through publicly traded vehicles such as Nippon Prologis REIT, Inc. (“NPR”) and FIBRA Prologis. These private and public vehicles provide capital for distinct geographies across our global platform. We hold a significant ownership interest in these ventures, aligning our interests with those of our partners. We generate strategic capital revenues from our unconsolidated ventures through asset

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management and property management services and we earn additional revenues from leasing, acquisition, construction, development and disposition services provided. Depending on the structure of the venture and the returns provided to our partners, we also earn revenues through incentive fees during the life of a venture or upon liquidation (we refer to these incentive fees as promotes). We believe our co-investment ventures will continue to serve as a source of capital for investments, provide incremental revenues and mitigate risk associated with our foreign currency exposure. We plan to grow this business generally through existing ventures.

Competition

Competitively priced distribution space could impact our occupancy rates and have an adverse effect on how much rent we can charge, which in turn could affect both of our operating segments. To the extent we wish to acquire land for development or dispose of land, we may compete with local, regional and national operators and/or developers. We also face competition from investment managers for institutional capital within our strategic capital business.

We believe we have competitive advantages due to our:

| • |  | ability to respond quickly to customers’ needs for high-quality distribution space in key global and regional markets;

| • |  | established relationships with key customers served by our local teams;

| • |  | ability to leverage our organizational scale and structure to provide a single point of contact for global customers through the Prologis global customer solutions team;

| • |  | property management and leasing expertise;

| • |  | relationships and proven track record with current and prospective investors in our strategic capital business;

| • |  | global experience developing and managing industrial properties;

| • |  | well-positioned land bank; and

| • |  | team members with experience in the land entitlement process.

Customers

Our broad customer base represents a spectrum of international, national, regional and local distribution users. At December 31, 2014, in Real Estate Operations, we had more than 3,900 customers occupying 271.6 million square feet of distribution space. On an owned and managed basis, we had more than 4,700 customers occupying 519.1 million square feet of distribution space. Our largest customer and 25 largest customers accounted for 1.9% and 19.5%, respectively, of our net effective rent at December 31, 2014, for Real Estate Operations and 2.1% and 18.6%, respectively, for our owned and managed portfolio.

In Strategic Capital, we view our partners and investors as our customers. At December 31, 2014, in our private ventures, we partnered with more than 100 investors, several of which invest in multiple ventures.

Employees

We employ 1,505 people across the globe. Our employees work in four countries in the Americas (900 people), 14 countries in Europe (360 people) and three countries in Asia (245 people). Of the total, we have assigned 955 employees to Real Estate Operations and 90 employees to Strategic Capital. Further, we have 460 individuals who work in corporate and support positions that support both segments. We believe we have good relationships with our employees. Prologis employees are not organized under collective bargaining agreements, although some employees in Europe are represented by statutory Works Councils and as such they benefit from applicable labor agreements.

Code of Ethics and Business Conduct

We maintain a Code of Ethics and Business Conduct applicable to our Board of Directors (“Board”) and all of our officers and employees, including the principal executive officer, the principal financial officer and the principal accounting officer, or persons performing similar functions. A copy of our Code of Ethics and Business Conduct is available on our website, www.prologis.com. In addition to being accessible through our website, copies of our Code of Ethics and Business Conduct can be obtained, free of charge, upon written request to Investor Relations, Pier 1, Bay 1, San Francisco, California 94111. Any amendments to or waivers of our Code of Ethics and Business Conduct that apply to the principal executive officer, the principal financial officer, or the principal accounting officer, or persons performing similar functions, and that relate to any matter enumerated in Item 406(b) of Regulation S-K, will be disclosed on our website.

Environmental Matters

We are exposed to various environmental risks that may result in unanticipated losses and affect our operating results and financial condition. Either the previous owners or we have subjected a majority of the properties we have acquired, including land, to environmental reviews. While some of these assessments have led to further investigation and sampling, none of the environmental assessments has revealed an

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environmental liability that we believe would have a material adverse effect on our business, financial condition or results of operations. See Item 1A. Risk Factors and Note 19 to the Consolidated Financial Statements in Item 8.

Insurance Coverage

We carry insurance coverage on our properties. We determine the type of coverage and the policy specifications and limits based on what we deem to be the risks associated with our ownership of properties and our business operations in specific markets. Such coverage typically includes property damage and rental loss insurance resulting from such perils as fire, windstorm, flood, earthquake and terrorism; commercial general liability insurance; and environmental insurance. Insurance is maintained through a combination of commercial insurance, self insurance and through a wholly-owned captive insurance entity. The costs to insure our properties are primarily covered through reimbursements from our customers. We believe that our insurance coverage contains policy specifications and insured limits that are customary for similar properties, business activities and markets and we believe our properties are adequately insured. See further discussion in Item 1A. Risk Factors.

ITEM 1A. Risk Factors

Our operations and structure involve various risks that could adversely affect our financial condition, results of operations, distributable cash flow and value of our securities. These risks include, among others:

General

As a global company, we are subject to social, political and economic risks of doing business in many countries.

We conduct a significant portion of our business and employ a substantial number of people outside of the United States. During 2014, we generated approximately $369.6 million or 21.0% of our revenue from operations outside the United States. Circumstances and developments related to international operations that could negatively affect our business, financial condition, results of operations or cash flow include, but are not limited to, the following factors:

| • |  | difficulties and costs of staffing and managing international operations in certain regions;

| • |  | differing employment practices and labor issues;

| • |  | local businesses and cultural factors that differ from our usual standards and practices;

| • |  | volatility in currencies;

| • |  | currency restrictions, which may prevent the transfer of capital and profits to the United States;

| • |  | unexpected changes in regulatory requirements and other laws;

| • |  | potentially adverse tax consequences;

| • |  | the responsibility of complying with multiple and potentially conflicting laws, e.g., with respect to corrupt practices, employment and licensing;

| • |  | the impact of regional or country-specific business cycles and economic instability;

| • |  | political instability, uncertainty over property rights, civil unrest, drug trafficking, political activism or the continuation or escalation of terrorist or gang activities (particularly with respect to our operations in Mexico);

| • |  | foreign ownership restrictions in operations with the respective countries; and

| • |  | access to capital may be more restricted, or unavailable on favorable terms or at all in certain locations.

Our global growth also subjects us to certain risks, including risks associated with funding increasing headcount, integrating new offices, and establishing effective controls and procedures to regulate the operations of new offices and to monitor compliance with regulations such as the Foreign Corrupt Practices Act, the United Kingdom Bribery Act and similar laws.

Although we have committed substantial resources to expand our global platform, if we are unable to successfully manage the risks associated with our global business or to adequately manage operational fluctuations, our business, financial condition, results of operations and cash flow could be harmed.

In addition, we may be impacted by, the ability of our non-United States subsidiaries to dividend or otherwise transfer cash among our subsidiaries, including transfers of cash to pay interest and principal on our debt, due to by currency exchange control regulations, transfer pricing regulations and potentially adverse tax consequences, among other things.

The depreciation in the value of the foreign currency in countries where we have a significant investment may adversely affect our results of operations and financial position.

We have pursued, and intend to continue to pursue, growth opportunities in international markets where the U.S. dollar is not the functional currency. At December 31, 2014, approximately $6.4 billion or 24.9% of our total assets are invested in a currency other than the U.S. dollar,

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primarily the British pound sterling, euro and Japanese yen. As a result, we are subject to foreign currency risk due to potential fluctuations in exchange rates between foreign currencies and the U.S. dollar. A significant change in the value of the foreign currency of one or more countries where we have a significant investment may have a material adverse effect on our U.S. dollar reported financial position, debt covenant ratios, results of operations and cash flow. Although we attempt to mitigate adverse effects by borrowing under debt agreements denominated in foreign currencies and using derivative contracts, there can be no assurance that those attempts to mitigate foreign currency risk will be successful. Hedging arrangements involve risks, such as the risk that counterparties may fail to honor their obligations under these arrangements and the risk of fluctuation in the relative value of the foreign currency. The funds required to settle such arrangements could be significant depending on the stability and movement of the hedged foreign currency. The failure to hedge effectively against exchange rate changes may materially adversely affect our results of operations and financial position.

Disruptions in the global capital and credit markets may adversely affect our operating results and financial condition.

To the extent there is turmoil in the global financial markets, it has the potential to adversely affect the value of our properties and investments in our unconsolidated entities, the availability or the terms of financing that we and our unconsolidated entities have or may anticipate utilizing, our ability and that of our unconsolidated entities to make principal and interest payments on, or refinance any outstanding debt when due and may impact the ability of our customers to enter into new leasing transactions or satisfy rental payments under existing leases.

Any additional, continued or recurring disruptions in the capital and credit markets may adversely affect our financial condition, results of operations, cash flow and ability to make distributions and payments to our security holders and the market price of our securities.

Risks Related to our Business

Real estate investments are not as liquid as certain other types of assets, which may reduce economic returns to investors.

Real estate investments are not as liquid as certain other types of investments and this lack of liquidity may limit our ability to react promptly to changes in economic or other conditions. In addition, significant expenditures associated with real estate investments, such as secured mortgage payments, real estate taxes and maintenance costs, are generally not reduced when circumstances cause a reduction in income from the investments. Like other companies qualifying as REITs under the Internal Revenue Code, we are only able to hold property for sale in the ordinary course of business through taxable REIT subsidiaries in order to not incur punitive taxation on any tax gain from the sale of such property. While we may dispose of certain properties that have been held for investment in order to generate liquidity, if we do not satisfy certain safe harbors or we believe there is too much risk of incurring the punitive tax on any tax gain from the sale, we may not pursue such sales.

In the event that we do not have sufficient cash available to us through our operations or available credit facilities to continue operating our business as usual, we may need to find alternative ways to increase our liquidity. Such alternatives may include, without limitation, divesting ourselves of properties, whether or not they otherwise meet our strategic objectives to keep in the long term, at less than optimal terms, incurring debt, entering into leases with new customers at lower rental rates or less than optimal terms or entering into lease renewals with our existing customers without an increase in rental rates. There can be no assurance, however, that such alternative ways to increase our liquidity will be available to us. Additionally, taking such measures to increase our liquidity may adversely affect our financial condition, results of operations, cash flow, our ability to make distributions and payments to our security holders and the market price of our securities.

General economic conditions and other events or occurrences that affect areas in which our properties are geographically concentrated, may impact financial results.

We are exposed to general economic conditions, local, regional, national and international economic conditions and other events and occurrences that affect the markets in which we own properties. Our operating performance is further impacted by the economic conditions of the specific markets in which we have concentrations of properties.

At December 31, 2014, approximately 33.6% of our consolidated operating properties or $6.3 billion (based on investment before depreciation) are located in California, which represented 25.9% of the aggregate square footage of our operating properties and 31.9% of our net operating income. Our revenue from, and the value of, our properties located in California may be affected by local real estate conditions (such as an oversupply of or reduced demand for industrial properties) and the local economic climate. Business layoffs, downsizing, industry slowdowns, changing demographics and other factors may adversely impact California’s economic climate. Because of the number of properties we have located in California, a downturn in California’s economy or real estate conditions could adversely affect our financial condition, results of operations, cash flow and ability to make distributions and payments to our security holders and the market price of our securities.

In addition to California, we also have significant holdings (defined as more than 3% of total investment before depreciation) in operating properties in certain global and regional markets located in Central & Eastern Pennsylvania, Chicago, Dallas/Fort Worth, New Jersey/New York City, South Florida and Canada. Our operating performance could be adversely affected if conditions become less favorable in any of the markets in which we have a concentration of properties. Conditions such as an oversupply of distribution space or a reduction in demand for distribution space, among other factors, may impact operating conditions. Any material oversupply of distribution space or material reduction in demand for distribution space could adversely affect our results of operations, distributable cash flow and the value of our securities.

In addition, the unconsolidated co-investment ventures in which we invest have concentrations of properties in the same markets mentioned above, as well as in markets in France, Germany, Japan, Mexico, the Netherlands, Poland and the United Kingdom, and are subject to the economic conditions in those markets.

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A number of our investments, both wholly-owned and owned through co-investment ventures, are located in areas that are known to be subject to earthquake activity. United States properties located in active seismic areas include properties in the San Francisco Bay Area, Los Angeles, and Seattle. International properties located in active seismic areas include Japan and Mexico. We generally carry earthquake insurance on our properties located in areas historically subject to seismic activity, subject to coverage limitations and deductibles if we believe it is commercially reasonable. We evaluate our earthquake insurance coverage annually in light of current industry practice through an analysis prepared by outside consultants and in some specific instances have elected to self insure our earthquake exposure based on this analysis. We have elected not to carry earthquake insurance for our assets in Japan based on this analysis.

Further, a number of our properties are located in areas that are known to be subject to hurricane and/or flood risk. We carry hurricane and flood hazard insurance on all of our properties located in areas historically subject to such activity, subject to coverage limitations and deductibles if we believe it is commercially reasonable. We evaluate our insurance coverage annually in light of current industry practice through an analysis prepared by outside consultants.

Our insurance coverage does not include all potential losses.

We and our unconsolidated co-investment ventures currently carry insurance coverage including property damage and rental loss insurance resulting from certain perils such as fire and additional perils as covered under an extended coverage policy, namely windstorm, flood, earthquake and terrorism; commercial general liability insurance; and environmental insurance, as appropriate for the markets where each of our properties and business operations are located. The insurance coverage contains policy specifications and insured limits customarily carried for similar properties, business activities and markets. We believe our properties and the properties of our unconsolidated co-investment ventures are adequately insured. However, there are certain losses, including losses from floods, earthquakes, acts of war, acts of terrorism or riots, that are not generally insured against or that are not generally fully insured against because it is not deemed economically feasible or prudent to do so. If an uninsured loss or a loss in excess of insured limits occurs with respect to one or more of our properties, we could experience a significant loss of capital invested and future revenues in these properties and could potentially remain obligated under any recourse debt associated with the property.

Furthermore, we cannot be sure that the insurance companies will be able to continue to offer products with sufficient coverage at commercially reasonable rates. If we experience a loss that is uninsured or that exceeds insured limits with respect to one or more of our properties or if the insurance companies fail to meet their coverage commitments to us in the event of an insured loss, then we could lose the capital invested in the damaged properties, as well as the anticipated future revenue from those properties and, if there is recourse debt, then we would remain obligated for any mortgage debt or other financial obligations related to the properties. Any such losses or higher insurance costs could adversely affect our financial condition, results of operations, cash flow and ability to make distributions and payments to our security holders and the market price of our securities.

Investments in real estate properties are subject to risks that could adversely affect our business.

Investments in real estate properties are subject to varying degrees of risk. While we seek to minimize these risks through geographic diversification of our portfolio, market research and our property management capabilities, these risks cannot be eliminated. Some of the factors that may affect real estate values include:

| • |  | local conditions, such as an oversupply of distribution space or a reduction in demand for distribution space in an area;

| • |  | the attractiveness of our properties to potential customers;

| • |  | competition from other available properties;

| • |  | increasing costs of rehabilitating, repositioning, renovating and making improvements to our properties;

| • |  | our ability to provide adequate maintenance of, and insurance on, our properties;

| • |  | our ability to control rents and variable operating costs;

| • |  | governmental regulations, including zoning, usage and tax laws and changes in these laws; and

| • |  | potential liability under, and changes in, environmental, zoning and other laws.

Our investments are concentrated in the industrial distribution sector and our business would be adversely affected by an economic downturn in that sector.

Our investments in real estate assets are primarily concentrated in the industrial distribution sector. This concentration may expose us to the risk of economic downturns in this sector to a greater extent than if our business activities were more diversified.

Our operating results and distributable cash flow will depend on the continued generation of lease revenues from customers and we may be unable to lease vacant space or renew leases or re-lease space on favorable terms as leases expire.

Our operating results and distributable cash flow would be adversely affected if a significant number of our customers were unable to meet their lease obligations. We are also subject to the risk that, upon the expiration of leases for space located in our properties, leases may not be

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renewed by existing customers, the space may not be re-leased to new customers or the terms of renewal or re-leasing (including the cost of required renovations or concessions to customers) may be less favorable to us than current lease terms. Our competitors may offer space at rental rates below current market rates or below the rental rates we currently charge our customers, we may lose potential customers, and we may be pressured to reduce our rental rates below those we currently charge in order to retain customers when our customers’ leases expire. In the event of default by a significant number of customers, we may experience delays and incur substantial costs in enforcing our rights as landlord, and may be unable to re-lease spaces. A customer may experience a downturn in its business, which may cause the loss of the customer or may weaken its financial condition, resulting in the customer’s failure to make rental payments when due or requiring a restructuring that might reduce cash flow from the lease. In addition, a customer may seek the protection of bankruptcy, insolvency or similar laws, which could result in the rejection and termination of such customer’s lease and thereby cause a reduction in our available cash flow.

We may acquire properties, which involves risks that could adversely affect our operating results and the value of our securities.

We have acquired properties and will continue to acquire properties, both through the direct acquisition of real estate and through the acquisition of entities that own the real estate. The acquisition of properties involves risks, including the risk that the acquired property will not perform as anticipated and that any actual costs for rehabilitation, repositioning, renovation and improvements identified in the pre-acquisition due diligence process will exceed estimates. When we acquire properties, we may face risks associated with a lack of market knowledge or understanding of the local economy, forging new business relationships in the area and unfamiliarity with local government and permitting procedures. Additionally, there is, and it is expected there will continue to be, significant competition for properties that meet our investment criteria as well as risks associated with obtaining financing for acquisition activities. The acquired properties or entities may also be subject to liabilities, which may be without any recourse, or with only limited recourse, with respect to unknown liabilities. As a result, if a liability were asserted against us based upon ownership of any of these entities or properties, then we may have to pay substantial sums to settle it.

Our real estate development strategies may not be successful.

Our real estate development strategy is focused on monetizing land in the future through sales to third parties, development of industrial properties to hold for long-term investment or contribution or sale to a co-investment venture, depending on market conditions, our liquidity needs and other factors. We may increase our investment in the development, renovation and redevelopment business and we will complete the build-out and leasing of our development portfolio. We may also develop, renovate and redevelop properties within existing or newly formed development co-investment ventures. The real estate development, renovation and redevelopment business involves significant risks that could adversely affect our financial condition, results of operations, cash flow and ability to make distributions and payments to our security holders and the market price of our securities, which include the following risks:

| • |  | we may not be able to obtain financing for development projects on favorable terms or at all;

| • |  | we may not be able to obtain, or may experience delays in obtaining, all necessary zoning, land-use, building, occupancy and other governmental permits and authorizations;

| • |  | we may seek to sell certain land parcels and not be able to find a third party to acquire such land or the sales price will not allow us to recover our investment, resulting in impairment charges;

| • |  | development opportunities that we explore may be abandoned and the related investment impaired;

| • |  | the properties may perform below anticipated levels, producing cash flow below budgeted amounts;

| • |  | we may not be able to lease properties on favorable terms or at all;

| • |  | construction costs, total investment amounts and our share of remaining funding may exceed our estimates and projects may not be completed, delivered or stabilized as planned;

| • |  | we may not be able to attract third-party investment in new development co-investment ventures or sufficient customer demand for our product;

| • |  | we may not be able to capture the anticipated enhanced value created by our redevelopment projects on expected timetables or at all;

| • |  | we may experience delays (temporary or permanent) if there is public or government opposition to our activities; and

| • |  | substantial renovation, new development and redevelopment activities, regardless of their ultimate success, typically require a significant amount of management’s time and attention, diverting their attention from our day-to-day operations.

We are exposed to various environmental risks that may result in unanticipated losses that could affect our operating results, financial condition and cash flow.

Under various federal, state and local laws, ordinances and regulations, a current or previous owner, developer or operator of real estate may be liable for the costs of removal or remediation of certain hazardous or toxic substances. The costs of removal or remediation of such substances could be substantial. Such laws often impose liability without regard to whether the owner or operator knew of, or was responsible for, the release or presence of such hazardous substances. In addition, third parties may sue the owner or operator of a site for damages based on personal injury, property damage or other costs, including investigation and clean-up costs, resulting from the environmental contamination.

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Environmental laws in some countries, including the United States, also require that owners or operators of buildings containing asbestos properly manage and maintain the asbestos, adequately inform or train those who may come into contact with asbestos and undertake special precautions, including removal or other abatement, in the event that asbestos is disturbed during building renovation or demolition. These laws may impose fines and penalties on building owners or operators who fail to comply with these requirements and may allow third parties to seek recovery from owners or operators for personal injury associated with exposure to asbestos. Some of our properties are known to contain asbestos-containing building materials.

In addition, some of our properties are leased or have been leased, in part, to owners and operators of businesses that use, store or otherwise handle petroleum products or other hazardous or toxic substances, creating a potential for the release of such hazardous or toxic substances. Further, certain of our properties are on, adjacent to or near other properties that have contained or currently contain petroleum products or other hazardous or toxic substances, or upon which others have engaged, are engaged or may engage in activities that may release such hazardous or toxic substances. From time to time, we may acquire properties, or interests in properties, with known adverse environmental conditions where we believe that the environmental liabilities associated with these conditions are quantifiable and that the acquisition will yield a superior risk-adjusted return. In connection with certain divested properties, we have agreed to remain responsible for, and to bear the cost of, remediating or monitoring certain environmental conditions on the properties.

We cannot give any assurance that other such conditions do not exist or may not arise in the future. The presence of such substances on our real estate properties could adversely affect our ability to lease, develop or sell such properties or to borrow using such properties as collateral, and may have an adverse effect on our distributable cash flow.

If we decide to contribute or sell properties to unconsolidated co-investment ventures or third parties to generate proceeds, we may not be successful.

We may decide to contribute or sell properties to certain of our unconsolidated co-investment ventures or third parties depending on a number of factors. Our ability to sell properties on advantageous terms is affected by: competition from other owners of properties that are trying to dispose of their properties; market conditions, including the capitalization rates applicable to our properties; and other factors beyond our control. If our competitors sell assets similar to assets we intend to divest in the same markets and/or at valuations below our valuations for comparable assets, we may be unable to divest our assets at favorable pricing or at all. The unconsolidated co-investment venture or third party who might acquire our properties may need to have access to debt and equity capital, in the private and public markets, in order to acquire properties from us. Should they have limited or no access to capital on favorable terms, then dispositions could be delayed. If we are unable to generate proceeds through property sales, this may result in adverse effects on our liquidity, distributable cash flow, debt covenants, and the market price of our securities.

We are subject to risks and liabilities in connection with forming co-investment ventures, investing in new or existing co-investment ventures, attracting third-party investment and investing in and managing properties through co-investment ventures.

At December 31, 2014, we had an investment in real estate containing approximately 261 million square feet held through unconsolidated co-investment ventures, both public and private. Our organizational documents do not limit the amount of available funds that we may invest in unconsolidated ventures, and we may and currently intend to develop and acquire properties through co-investment ventures and investments in other entities when warranted by the circumstances. However, there can be no assurance that we will be able to form new co-investment ventures, attract third-party investment or make additional investments in new or existing ventures, successfully develop or acquire properties through unconsolidated ventures, or realize value from such investments. Our inability to do so may have an adverse effect on our growth, results of operations, cash flows and the market price of our securities.

Our co-investment ventures involve certain additional risks that we do not otherwise face, including:

| • |  | our partners may share certain approval rights over major decisions made on behalf of the ventures;

| • |  | if our partners fail to fund their share of any required capital contributions, then we may choose to contribute such capital;

| • |  | our partners might have economic or other business interests or goals that are inconsistent with our business interests or goals that would affect our ability to operate the property;

| • |  | the venture or other governing agreements often restrict the transfer of an interest in the co-investment venture or may otherwise restrict our ability to sell the interest when we desire or on advantageous terms;

| • |  | our relationships with our partners are generally contractual in nature and may be terminated or dissolved under the terms of the agreements, and in such event, we may not continue to manage or invest in the assets underlying such relationships resulting in reduced fee revenue or causing a need to purchase such interest to continue ownership; and

| • |  | disputes between us and our partners may result in litigation or arbitration that would increase our expenses and prevent our officers and directors from focusing their time and effort on our business and result in subjecting the properties owned by the applicable co-investment venture to additional risk.

We generally seek to maintain sufficient influence over our co-investment ventures to permit us to achieve our business objectives; however, we may not be able to continue to do so indefinitely. We have formed publicly traded investment vehicles, such as NPR and FIBRA Prologis, for which we serve as sponsor and/or manager. We have contributed, and may continue to contribute, assets into such vehicles. There is a risk that our managerial relationship may be terminated.

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The occurrence of one or more of the events described above could adversely affect our financial condition, results of operations, cash flow and ability to make distributions and payments to our security holders and the market price of our securities.

Risks Related to Financing and Capital

We face risks associated with the use of debt to fund our business activities, including refinancing and interest rate risks, which may adversely affect our operating results and financial condition if we are unable to make required payments on our debt or are unable to refinance our debt.

We are subject to risks normally associated with debt financing, including the risk that our cash flow will be insufficient to meet required payments of principal and interest. There can be no assurance that we will be able to refinance any maturing indebtedness, that such refinancing would be on terms as favorable as the terms of the maturing indebtedness, or that we will be able to otherwise obtain funds by selling assets or raising equity to make required payments on maturing indebtedness. If we are unable to refinance our indebtedness at maturity or meet our payment obligations, the amount of our distributable cash flow and our financial condition would be adversely affected and, if the maturing debt is secured, the lender may foreclose on the property securing such indebtedness. Our credit facilities and certain other debt bears interest at variable rates. Increases in interest rates would increase our interest expense under these agreements. From time to time, we may enter into interest rate swap or cap agreements. Such hedging arrangements involve risks, such as the risk that counterparties may fail to honor their obligations under these arrangements. The funds required to settle any swap breakage arrangements, if any, could be significant depending on the size of the underlying financing and the applicable interest rates at the time of breakage. The failure to hedge effectively against interest rate changes may adversely affect our results of operations and financial position. In addition, our co-investment ventures may be unable to refinance indebtedness or meet payment obligations, which may impact our distributable cash flow and our financial condition.

Covenants in our credit agreements could limit our flexibility and breaches of these covenants could adversely affect our financial condition.

The terms of our various credit agreements, including our credit facilities, the indentures under which our senior notes are issued and other note agreements, require us to comply with a number of customary financial covenants, such as maintaining debt service coverage, leverage ratios, fixed charge ratios and other operating covenants including maintaining insurance coverage. These covenants may limit our flexibility in our operations, and breaches of these covenants could result in defaults under the instruments governing the applicable indebtedness. If we default under the covenant provisions and are unable to cure the default, refinance the indebtedness or meet payment obligations, the amount of our distributable cash flow, our operating results and our financial condition could be adversely affected.

Adverse changes in our credit ratings could negatively affect our financing activity.

The credit ratings of our senior unsecured notes and preferred stock are based on our operating performance, liquidity and leverage ratios, overall financial position and other factors employed by the credit rating agencies in their rating analyses of us. Our credit ratings can affect the amount of capital we can access, as well as the terms and pricing of any debt we may incur. There can be no assurance that we will be able to maintain our current credit ratings, and in the event our credit ratings are downgraded, we would likely incur higher borrowing costs and may encounter difficulty in obtaining additional financing. Also, a downgrade in our credit ratings may trigger additional payments or other negative consequences under our current and future credit facilities and debt instruments. Adverse changes in our credit ratings could negatively impact our refinancing and other capital market activities, our ability to manage debt maturities, our future growth, our financial condition, the market price of our securities, and our development and acquisition activity.

At December 31, 2014, our credit ratings were Baa1 from Moody’s and BBB+ from S&P, both with outlook stable. A securities rating is not a recommendation to buy, sell or hold securities and is subject to revision or withdrawal at any time by the rating organization.

We are dependent on external sources of capital.

In order to qualify as a REIT, we are required each year to distribute to our stockholders at least 90% of our REIT taxable income (determined without regard to the dividends-paid deduction and by excluding any net capital gain) and we may be subject to tax to the extent our taxable income is not fully distributed. While historically we have satisfied these distribution requirements by making cash distributions to our stockholders, we may choose to satisfy these requirements by making distributions of cash or other property, including, in limited circumstances, our own stock. For distributions with respect to taxable years ending on or before December 31, 2014, and in some cases declared as late as December 31, 2015, the REIT can satisfy up to 90% of the distribution requirements discussed above through the distribution of shares of our stock if certain conditions are met. Assuming we continue to satisfy these distribution requirements with cash, we may not be able to fund all future capital needs, including acquisition and development activities, from cash retained from operations and may have to rely on third-party sources of capital. Further, in order to maintain our REIT status and not have to pay federal income and excise taxes, we may need to borrow funds on a short-term basis to meet the REIT distribution requirements even if the then-prevailing market conditions are not favorable for these borrowings. These short-term borrowing needs could result from differences in timing between the actual receipt of cash and inclusion of income for federal income tax purposes, or the effect of non-deductible capital expenditures, the creation of reserves or required debt or amortization payments. Our ability to access debt and equity capital on favorable terms or at all is dependent upon a number of factors, including general market conditions, the market’s perception of our growth potential, our current and potential future earnings and cash distributions and the market price of our securities.

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Our stockholders may experience dilution if we issue additional common stock or units in the Operating Partnership.

Any additional future issuance of common stock or operating partnership units will reduce the percentage of our common stock/units owned by investors. In most circumstances, stockholders/unitholders will not be entitled to vote on whether or not we issue additional common stock/units. In addition, depending on the terms and pricing of any additional offering of our common stock/units and the value of the properties, our stockholders/unitholders may experience dilution in both book value and fair value of their common stock/units.

Federal Income Tax Risks

Our failure of Prologis, Inc. to qualify as a REIT would have serious adverse consequences.

Prologis, Inc. elected to be taxed as a REIT under Sections 856 through 860 of the Internal Revenue Code commencing with the taxable year ended December 31, 1997. We believe we have operated Prologis, Inc. to qualify as a REIT under the Internal Revenue Code and believe that the current organization and method of operation comply with the rules and regulations promulgated under the Internal Revenue Code to enable Prologis, Inc. to continue to qualify as a REIT. However, it is possible that we are organized or have operated in a manner that would not allow Prologis, Inc. to qualify as a REIT, or that our future operations could cause Prologis, Inc. to fail to qualify. Qualification as a REIT requires us to satisfy numerous requirements (some annually and others on a quarterly basis) established under highly technical and complex sections of the Internal Revenue Code for which there are only limited judicial and administrative interpretations, and involves the determination of various factual matters and circumstances not entirely within our control. For example, in order to qualify as a REIT, Prologis, Inc. must derive at least 95% of its gross income in any year from qualifying sources. In addition, Prologis, Inc. must pay dividends to its stockholders aggregating annually at least 90% of its taxable income (determined without regard to the dividends paid deduction and by excluding capital gains) and must satisfy specified asset tests on a quarterly basis. The provisions of the Internal Revenue Code and applicable Treasury regulations regarding qualification as a REIT are more complicated for Prologis, Inc. because we hold assets through the Operating Partnership.

If Prologis, Inc. fails to qualify as a REIT in any taxable year, we will be required to pay federal income tax (including any applicable alternative minimum tax) on taxable income at regular corporate rates. Unless we are entitled to relief under certain statutory provisions, Prologis, Inc. would be disqualified from treatment as a REIT for the four taxable years following the year in which it lost the qualification. If Prologis, Inc. lost its REIT status, our net earnings would be significantly reduced for each of the years involved.

Furthermore, we own a direct or indirect interest in certain subsidiary REITs which elected to be taxed as REITs under Sections 856 through 860 of the Internal Revenue Code. Provided that each subsidiary REIT qualifies as a REIT, our interest in such subsidiary REIT will be treated as a qualifying real estate asset for purposes of the REIT asset tests, and any dividend income or gains derived by us from such subsidiary REIT will generally be treated as income that qualifies for purposes of the REIT gross income tests. To qualify as a REIT, the subsidiary REIT must independently satisfy all of the REIT qualification requirements. If such subsidiary REIT were to fail to qualify as a REIT, and certain relief provisions did not apply, it would be treated as a regular taxable corporation and its income would be subject to United States federal income tax. In addition, a failure of the subsidiary REIT to qualify as a REIT would have an adverse effect the ability of Prologis, Inc. to comply with the REIT income and asset tests, and thus its ability to qualify as a REIT.

Certain property transfers may generate prohibited transaction income, resulting in a penalty tax on gain attributable to the transaction.

From time to time, we may transfer or otherwise dispose of some of our properties, including by contributing properties to our co-investment ventures. Under the Internal Revenue Code, any gain resulting from transfers of properties we hold as inventory or primarily for sale to customers in the ordinary course of business is treated as income from a prohibited transaction subject to a 100% penalty tax. We do not believe that our transfers or disposals of property or our contributions of properties into our co-investment ventures are prohibited transactions. However, whether property is held for investment purposes is a question of fact that depends on all the facts and circumstances surrounding the particular transaction. The Internal Revenue Service may contend that certain transfers or dispositions of properties by us or contributions of properties into our co-investment ventures are prohibited transactions. While we believe that the Internal Revenue Service would not prevail in any such dispute, if the Internal Revenue Code were to argue successfully that a transfer, disposition or contribution of property constituted a prohibited transaction, we would be required to pay a 100% penalty tax on any gain allocable to us from the prohibited transaction. In addition, income from a prohibited transaction might adversely affect our ability to satisfy the income tests for qualification as a REIT.

Legislative or regulatory action could adversely affect us.

In recent years, numerous legislative, judicial and administrative changes have been made to the federal income tax taws applicable to investments in REITs and similar entities. Additional changes to tax laws are likely to continue to occur in the future, and may impact our taxation or that of our stockholders.

Other Risks

Our business and operations could suffer in the event of system failures or cyber security attacks.

Despite system redundancy, the implementation of security measures and the existence of a disaster recovery plan for our internal information technology systems, our systems are vulnerable to damages from any number of sources, including energy blackouts, natural disasters, terrorism, war, telecommunication failures and cyber security attacks, such as computer viruses or unauthorized access. Any system failure or accident that causes interruptions in our operations could result in a material disruption to our business. We may also incur additional costs to remedy damages caused by such disruptions. Any compromise of our security could also result in a violation of applicable privacy and other laws, unauthorized access to information of ours and others, significant legal and financial exposure, damage to our reputation, loss or misuse of the information and a loss of confidence in our security measures, which could harm our business.

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Risks associated with our dependence on key personnel.

We depend on the efforts of our executive officers and other key employees. From time to time, our personnel and their roles may change. While we believe that we retain our key talent and find suitable employees to meet our personnel needs, the loss of key personnel, any change in their roles or the limitation of their availability could adversely affect our financial condition, results of operations, cash flow and ability to make distributions and payments to security holders and the market price of our securities. If we are unable to continue to attract and retain our executive officers, or if compensation costs required to attract and retain key employees become more expensive, our performance and competitive position could be materially adversely affected.

Compliance or failure to comply with the Americans with Disabilities Act and other similar regulations could result in substantial costs.

Under the Americans with Disabilities Act, places of public accommodation must meet certain federal requirements related to access and use by disabled persons. Noncompliance could result in the imposition of fines by the federal government or the award of damages to private litigants. If we are required to make unanticipated expenditures to comply with the Americans with Disabilities Act, including removing access barriers, then our cash flow and the amounts available to make distributions and payments to our security holders may be adversely affected. Our properties are also subject to various federal, state and local regulatory requirements, such as state and local fire and life-safety requirements. We could incur fines or private damage awards if we fail to comply with these requirements. While we believe that our properties are currently in material compliance with these regulatory requirements, the requirements may change or new requirements may be imposed that could require significant unanticipated expenditures by us that will affect our cash flow and results of operations.

Our business could be adversely impacted if we have deficiencies in our disclosure controls and procedures or internal control over financial reporting.

The design and effectiveness of our disclosure controls and procedures and internal control over financial reporting may not prevent all errors, misstatements or misrepresentations. While management continually reviews the effectiveness of our disclosure controls and procedures and internal control over financial reporting, there can be no guarantee that our internal control over financial reporting will be effective in accomplishing all control objectives all of the time. Deficiencies, including any material weakness, in our internal control over financial reporting that may occur in the future could result in misstatements of our results of operations, restatements of our financial statements, a decline in the price of our securities, or otherwise materially adversely affect our business, reputation, results of operations, financial condition or liquidity.

We are exposed to the potential impacts of future climate change and climate change-related risks.

We are exposed to potential physical risks from possible future changes in climate. Our distribution facilities may be exposed to rare catastrophic weather events, such as severe storms and/or floods. If the frequency of extreme weather events increases due to climate change, our exposure to these events could increase.

We do not currently consider ourselves to be exposed to regulatory risks related to climate change, as our operations do not emit a significant amount of greenhouse gases. However, we may be adversely impacted as a real estate developer in the future by potential impacts to the supply chain and/or stricter energy efficiency standards for buildings.

ITEM 1B. Unresolved Staff Comments

None.

ITEM 2. Properties

We are invested in real estate properties that are predominately industrial properties. Our properties are typically used for distribution, storage, packaging, assembly and light manufacturing of consumer and industrial products. The vast majority of our operating properties are used by our customers for bulk distribution.

Geographic Distribution

Our investment strategy focuses on providing distribution and facilities to customers whose businesses are tied to global trade and depend on the efficient movement of goods through the global supply chain. We classify our properties into two main market categories: global and regional.

We manage our business on an owned and managed basis without regard to whether a particular property is wholly-owned by us or owned by one of our co-investment ventures. We believe that the operating fundamentals of our owned and managed portfolio are consistent with those of our consolidated portfolio and therefore allow us to make business decisions based on the property operations versus our ownership. As such, we have included operating property information for Real Estate Operations and our owned and managed portfolio. The owned and managed portfolio includes the properties we consolidate and the properties owned by our unconsolidated co-investment ventures reflected at 100% of the ventures, not our proportionate share.

Included in Real Estate Operations are 321 buildings owned by entities we consolidate but of which we own less than 100% of the equity. No individual property or group of properties operating as a single business unit amounted to 10% or more of our consolidated total assets at December 31, 2014, or generated income equal to 10% or more of our consolidated gross revenues for the year ended December 31, 2014.

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Dollars and square feet in the following tables are in thousands.

|  | Consolidated - Real Estate Operations |  |  | Owned and Managed |
Operating properties |  | Rentable Square Footage |  |  | Gross Book Value |  |  | Encumbrances (1) |  |  | Rentable Square Footage |  |  | Gross Book Value |
Global Markets - Americas: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
United States: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Atlanta |  |  | 11,455 |  |  | $ | 495,377 |  |  | $ | 76,218 |  |  |  | 14,343 |  |  | $ | 657,146 |
Baltimore/Washington |  |  | 5,967 |  |  |  | 524,429 |  |  |  | 115,225 |  |  |  | 8,073 |  |  |  | 706,223 |
Central Valley California |  |  | 10,093 |  |  |  | 553,989 |  |  |  | 86,451 |  |  |  | 10,197 |  |  |  | 558,138 |
Central & Eastern Pennsylvania |  |  | 14,925 |  |  |  | 927,252 |  |  |  | 84,543 |  |  |  | 14,925 |  |  |  | 927,252 |
Chicago |  |  | 28,888 |  |  |  | 1,620,872 |  |  |  | 187,287 |  |  |  | 35,591 |  |  |  | 2,137,078 |
Dallas/Fort Worth |  |  | 20,971 |  |  |  | 982,684 |  |  |  | 160,562 |  |  |  | 24,405 |  |  |  | 1,245,974 |
Houston |  |  | 8,574 |  |  |  | 461,757 |  |  |  | 92,131 |  |  |  | 12,373 |  |  |  | 754,346 |
New Jersey/New York City |  |  | 17,364 |  |  |  | 1,384,633 |  |  |  | 134,335 |  |  |  | 21,926 |  |  |  | 1,978,072 |
San Francisco Bay Area |  |  | 14,650 |  |  |  | 1,487,808 |  |  |  | 48,042 |  |  |  | 18,261 |  |  |  | 1,837,550 |
Seattle |  |  | 3,821 |  |  |  | 362,005 |  |  |  | 47,252 |  |  |  | 10,923 |  |  |  | 1,044,750 |
South Florida |  |  | 7,222 |  |  |  | 773,855 |  |  |  | 70,119 |  |  |  | 10,679 |  |  |  | 1,081,769 |
Southern California |  |  | 48,233 |  |  |  | 4,223,267 |  |  |  | 288,407 |  |  |  | 58,793 |  |  |  | 5,295,266 |
Canada |  |  | 7,065 |  |  |  | 642,728 |  |  |  | - |  |  |  | 7,065 |  |  |  | 642,728 |
Mexico: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Guadalajara |  |  | 60 |  |  |  | 4,379 |  |  |  | - |  |  |  | 5,872 |  |  |  | 315,122 |
Mexico City |  |  | 387 |  |  |  | 24,901 |  |  |  | - |  |  |  | 10,762 |  |  |  | 724,319 |
Monterrey |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 3,413 |  |  |  | 196,639 |
Brazil |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 5,266 |  |  |  | 414,355 |
Regional Markets - Americas: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
United States: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Austin |  |  | 2,213 |  |  |  | 147,661 |  |  |  | 29,640 |  |  |  | 2,213 |  |  |  | 147,661 |
Charlotte |  |  | 2,527 |  |  |  | 117,250 |  |  |  | 21,603 |  |  |  | 2,527 |  |  |  | 117,250 |
Cincinnati |  |  | 5,899 |  |  |  | 256,015 |  |  |  | 132,023 |  |  |  | 5,899 |  |  |  | 256,015 |
Columbus |  |  | 8,545 |  |  |  | 297,320 |  |  |  | 102,553 |  |  |  | 8,545 |  |  |  | 297,320 |
Denver |  |  | 4,491 |  |  |  | 272,418 |  |  |  | 56,196 |  |  |  | 4,491 |  |  |  | 272,418 |
Indianapolis |  |  | 5,095 |  |  |  | 206,916 |  |  |  | 87,282 |  |  |  | 5,095 |  |  |  | 206,916 |
Las Vegas |  |  | 3,610 |  |  |  | 200,462 |  |  |  | 31,253 |  |  |  | 3,610 |  |  |  | 200,462 |
Louisville |  |  | 3,435 |  |  |  | 144,441 |  |  |  | 14,580 |  |  |  | 3,435 |  |  |  | 144,441 |
Memphis |  |  | 5,297 |  |  |  | 184,815 |  |  |  | 6,026 |  |  |  | 5,297 |  |  |  | 184,815 |
Nashville |  |  | 4,660 |  |  |  | 178,113 |  |  |  | 65,827 |  |  |  | 4,660 |  |  |  | 178,113 |
Orlando |  |  | 3,488 |  |  |  | 234,777 |  |  |  | 38,633 |  |  |  | 3,895 |  |  |  | 261,761 |
Phoenix |  |  | 2,139 |  |  |  | 116,259 |  |  |  | 8,208 |  |  |  | 2,139 |  |  |  | 116,259 |
Portland |  |  | 2,010 |  |  |  | 151,401 |  |  |  | 56,109 |  |  |  | 2,010 |  |  |  | 151,401 |
Reno |  |  | 3,543 |  |  |  | 161,482 |  |  |  | 33,252 |  |  |  | 3,543 |  |  |  | 161,482 |
San Antonio |  |  | 5,606 |  |  |  | 255,715 |  |  |  | 61,924 |  |  |  | 5,606 |  |  |  | 255,715 |
Mexico: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Juarez |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 3,106 |  |  |  | 135,764 |
Reynosa |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 4,385 |  |  |  | 205,649 |
Tijuana |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 4,217 |  |  |  | 204,525 |
Other Markets - United States |  |  | 3,907 |  |  |  | 171,685 |  |  |  | 5,186 |  |  |  | 4,681 |  |  |  | 249,064 |
Subtotal Americas |  |  | 266,140 |  |  |  | 17,566,666 |  |  |  | 2,140,867 |  |  |  | 352,221 |  |  |  | 24,263,758 |
Global Markets - Europe: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Belgium |  |  | 439 |  |  |  | 32,231 |  |  |  | - |  |  |  | 2,497 |  |  |  | 179,404 |
Czech Republic |  |  | 278 |  |  |  | 20,142 |  |  |  | - |  |  |  | 7,737 |  |  |  | 518,874 |
France |  |  | 1,873 |  |  |  | 97,795 |  |  |  | - |  |  |  | 32,010 |  |  |  | 2,354,233 |
Germany |  |  | 1,161 |  |  |  | 65,688 |  |  |  | - |  |  |  | 20,405 |  |  |  | 1,655,157 |
Italy |  |  | 1,277 |  |  |  | 76,600 |  |  |  | - |  |  |  | 8,813 |  |  |  | 498,953 |
Netherlands |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 14,526 |  |  |  | 1,197,299 |
Poland |  |  | 2,142 |  |  |  | 99,331 |  |  |  | - |  |  |  | 23,056 |  |  |  | 1,421,752 |
Spain |  |  | 449 |  |  |  | 40,213 |  |  |  | - |  |  |  | 8,191 |  |  |  | 577,083 |
United Kingdom |  |  | 834 |  |  |  | 79,825 |  |  |  | - |  |  |  | 21,033 |  |  |  | 2,784,984 |
Regional Markets - Europe: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Hungary |  |  | 285 |  |  |  | 17,717 |  |  |  | - |  |  |  | 5,837 |  |  |  | 362,611 |
Slovakia |  |  | 549 |  |  |  | 28,796 |  |  |  | - |  |  |  | 4,897 |  |  |  | 314,811 |
Sweden |  |  | 524 |  |  |  | 34,264 |  |  |  | - |  |  |  | 3,807 |  |  |  | 305,756 |
Other Markets - Europe |  |  | 1,275 |  |  |  | 58,865 |  |  |  | - |  |  |  | 1,275 |  |  |  | 58,865 |
Subtotal Europe |  |  | 11,086 |  |  |  | 651,467 |  |  |  | - |  |  |  | 154,084 |  |  |  | 12,229,782 |
Global Markets - Asia: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
China |  |  | 2,324 |  |  |  | 79,540 |  |  |  | - |  |  |  | 7,597 |  |  |  | 387,508 |
Japan |  |  | 1,215 |  |  |  | 180,157 |  |  |  | - |  |  |  | 22,113 |  |  |  | 3,567,803 |
Singapore |  |  | 959 |  |  |  | 140,303 |  |  |  | - |  |  |  | 959 |  |  |  | 140,303 |
Subtotal Asia |  |  | 4,498 |  |  |  | 400,000 |  |  |  | - |  |  |  | 30,669 |  |  |  | 4,095,614 |
Total operating portfolio |  |  | 281,724 |  |  |  | 18,618,133 |  |  |  | 2,140,867 |  |  |  | 536,974 |  |  |  | 40,589,154 |
Value added properties (2) |  |  | 558 |  |  |  | 17,319 |  |  |  | - |  |  |  | 6,008 |  |  |  | 342,611 |
Total operating properties |  |  | 282,282 |  |  | $ | 18,635,452 |  |  |  | $2,140,867 |  |  |  | 542,982 |  |  | $ | 40,931,765 |

15

##### Table of Contents

|  | Investment in Land |  |  | Development Portfolio |
Consolidated land and development portfolio in Real Estate Operations |  | Acres |  |  | Estimated Build Out Potential (sq. ft.) (3) |  |  | Current Investment |  |  | Rentable Square Footage |  |  | Total Expected Investment (4) |
Global Markets - Americas: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
United States: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Atlanta |  |  | 473 |  |  |  | 6,619 |  |  | $ | 23,071 |  |  |  | 715 |  |  | $ | 30,869 |
Baltimore/Washington |  |  | 39 |  |  |  | 400 |  |  |  | 1,567 |  |  |  | - |  |  |  | - |
Central Valley California |  |  | 1,025 |  |  |  | 19,560 |  |  |  | 54,016 |  |  |  | 1,001 |  |  |  | 63,614 |
Central & Eastern Pennsylvania |  |  | 188 |  |  |  | 2,474 |  |  |  | 26,079 |  |  |  | 3,009 |  |  |  | 149,410 |
Chicago |  |  | 510 |  |  |  | 9,479 |  |  |  | 38,791 |  |  |  | 330 |  |  |  | 19,912 |
Dallas/Ft. Worth |  |  | 552 |  |  |  | 9,156 |  |  |  | 46,451 |  |  |  | 1,286 |  |  |  | 74,373 |
Houston |  |  | 70 |  |  |  | 1,112 |  |  |  | 8,636 |  |  |  | 229 |  |  |  | 15,459 |
New Jersey/New York City |  |  | 148 |  |  |  | 2,356 |  |  |  | 66,964 |  |  |  | 1,767 |  |  |  | 169,899 |
San Francisco Bay Area |  |  | 66 |  |  |  | 1,248 |  |  |  | 21,372 |  |  |  | - |  |  |  | - |
South Florida |  |  | 316 |  |  |  | 5,629 |  |  |  | 158,140 |  |  |  | 330 |  |  |  | 30,626 |
Southern California |  |  | 660 |  |  |  | 12,993 |  |  |  | 116,844 |  |  |  | 1,818 |  |  |  | 131,459 |
Canada |  |  | 171 |  |  |  | 3,281 |  |  |  | 49,686 |  |  |  | 1,169 |  |  |  | 110,809 |
Mexico: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Guadalajara |  |  | 50 |  |  |  | 1,066 |  |  |  | 11,615 |  |  |  | 231 |  |  |  | 13,958 |
Mexico City |  |  | 301 |  |  |  | 5,661 |  |  |  | 112,503 |  |  |  | 1,333 |  |  |  | 88,783 |
Monterrey |  |  | 161 |  |  |  | 2,656 |  |  |  | 30,995 |  |  |  | 501 |  |  |  | 30,437 |
Regional Markets - Americas: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
United States: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Charlotte |  |  | 7 |  |  |  | 103 |  |  |  | 651 |  |  |  | 205 |  |  |  | 10,849 |
Columbus |  |  | 121 |  |  |  | 1,861 |  |  |  | 4,397 |  |  |  | 410 |  |  |  | 17,149 |
Denver |  |  | 26 |  |  |  | 444 |  |  |  | 4,175 |  |  |  | 795 |  |  |  | 46,465 |
Indianapolis |  |  | 13 |  |  |  | 231 |  |  |  | 981 |  |  |  | - |  |  |  | - |
Las Vegas |  |  | 54 |  |  |  | 1,076 |  |  |  | 5,876 |  |  |  | 464 |  |  |  | 26,901 |
Memphis |  |  | 151 |  |  |  | 2,586 |  |  |  | 7,306 |  |  |  | 218 |  |  |  | 10,746 |
Orlando |  |  | 122 |  |  |  | 1,768 |  |  |  | 27,055 |  |  |  | 124 |  |  |  | 8,637 |
Phoenix |  |  | 38 |  |  |  | 698 |  |  |  | 3,058 |  |  |  | - |  |  |  | - |
Portland |  |  | 11 |  |  |  | 181 |  |  |  | 1,390 |  |  |  | 208 |  |  |  | 14,232 |
Reno |  |  | 117 |  |  |  | 1,911 |  |  |  | 5,116 |  |  |  | - |  |  |  | - |
Mexico: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Juarez |  |  | 137 |  |  |  | 2,692 |  |  |  | 13,864 |  |  |  | 210 |  |  |  | 11,324 |
Reynosa |  |  | 196 |  |  |  | 3,460 |  |  |  | 12,221 |  |  |  | 163 |  |  |  | 9,421 |
Tijuana |  |  | 34 |  |  |  | 626 |  |  |  | 5,723 |  |  |  | - |  |  |  | - |
Other Markets - United States |  |  | 401 |  |  |  | 6,051 |  |  |  | 30,552 |  |  |  | 740 |  |  |  | 46,931 |
Subtotal Americas |  |  | 6,158 |  |  |  | 107,378 |  |  |  | 889,095 |  |  |  | 17,256 |  |  |  | 1,132,263 |
Global Markets - Europe: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Belgium |  |  | 27 |  |  |  | 526 |  |  |  | 9,534 |  |  |  | - |  |  |  | - |
Czech Republic |  |  | 217 |  |  |  | 3,504 |  |  |  | 42,074 |  |  |  | 1,132 |  |  |  | 69,935 |
France |  |  | 449 |  |  |  | 8,398 |  |  |  | 78,831 |  |  |  | 880 |  |  |  | 65,637 |
Germany |  |  | 58 |  |  |  | 1,161 |  |  |  | 13,540 |  |  |  | 282 |  |  |  | 17,369 |
Italy |  |  | 107 |  |  |  | 2,451 |  |  |  | 30,084 |  |  |  | - |  |  |  | - |
Netherlands |  |  | 56 |  |  |  | 1,538 |  |  |  | 47,789 |  |  |  | 657 |  |  |  | 45,817 |
Poland |  |  | 634 |  |  |  | 12,215 |  |  |  | 74,576 |  |  |  | 486 |  |  |  | 28,292 |
Spain |  |  | 100 |  |  |  | 2,021 |  |  |  | 16,507 |  |  |  | 139 |  |  |  | 15,959 |
United Kingdom |  |  | 609 |  |  |  | 9,401 |  |  |  | 211,340 |  |  |  | 2,719 |  |  |  | 370,444 |
Regional Markets - Europe: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Hungary |  |  | 335 |  |  |  | 5,604 |  |  |  | 35,348 |  |  |  | - |  |  |  | - |
Slovakia |  |  | 78 |  |  |  | 1,708 |  |  |  | 13,076 |  |  |  | 255 |  |  |  | 13,154 |
Sweden |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 447 |  |  |  | 35,649 |
Other Markets - Europe |  |  | 118 |  |  |  | 2,600 |  |  |  | 19,641 |  |  |  | - |  |  |  | - |
Subtotal Europe |  |  | 2,788 |  |  |  | 51,127 |  |  |  | 592,340 |  |  |  | 6,997 |  |  |  | 662,256 |
Global Markets - Asia: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
China |  |  | 18 |  |  |  | 172 |  |  |  | 5,889 |  |  |  | - |  |  |  | - |
Japan |  |  | 53 |  |  |  | 2,423 |  |  |  | 90,462 |  |  |  | 6,039 |  |  |  | 747,128 |
Subtotal Asia |  |  | 71 |  |  |  | 2,595 |  |  |  | 96,351 |  |  |  | 6,039 |  |  |  | 747,128 |
Total land and development portfolio |  |  | 9,017 |  |  |  | 161,100 |  |  | $ | 1,577,786 |  |  |  | 30,292 |  |  | $ | 2,541,647 |

16

##### Table of Contents

The following is a summary of our investment in consolidated real estate properties at December 31, 2014 (in thousands):

|  | Investment Before Depreciation |
Industrial operating properties |  | $ | 18,635,452 |
Development portfolio, including cost of land |  |  | 1,473,980 |
Land |  |  | 1,577,786 |
Other real estate investments (5) |  |  | 502,927 |
Total consolidated real estate properties |  | $ | 22,190,145 |

(1) | Certain of our consolidated properties are pledged as security under our secured mortgage debt and assessment bonds at December 31, 2014. For purposes of this table, the total principal balance of a debt issuance that is secured by a pool of properties is allocated among the properties in the pool based on each property’s investment balance. In addition to the amounts reflected here, we also have $18.3 million of encumbrances related to other real estate properties not included in Real Estate Operations. See Schedule III — Real Estate and Accumulated Depreciation to the Consolidated Financial Statements in Item 8 for additional identification of the properties pledged.

(2) | Value-added properties represent properties that are expected to be repurposed to a better use or acquired properties with opportunities to improve operating challenges and create higher value.

(3) | Represents the estimated finished square feet available for rent upon development of an industrial building on existing parcels of land included in this table.

(4) | Represents the total expected investment when the property under development is completed and leased. This includes the cost of land and development and leasing costs. At December 31, 2014, 65% of the properties under development in the development portfolio were expected to be complete by December 31, 2015, and 25% of the properties in the development portfolio were already completed but not yet stabilized. A property is defined as stabilized when it has been completed for one year or is 90% occupied.

(5) | Included in other real estate investments are: (i) certain non-industrial real estate; (ii) our corporate office buildings; (iii) certain infrastructure costs related to projects we are developing on behalf of others; (iv) land parcels that are leased to third parties; (v) earnest money deposits associated with potential acquisitions; and (vi) costs related to future development projects, including purchase options on land.

Lease Expirations

We generally lease our properties on a long term basis (with a weighted average lease term of seven years). The following table summarizes the lease expirations of our consolidated operating portfolio for leases in place at December 31, 2014, without giving effect to the exercise of renewal options or termination rights, if any (dollars and square feet in thousands):

|  | Number of Leases |  |  | Occupied Square Feet |  |  | Net Effective Rent |
Year |  |  |  | $ |  |  | % of Total |  |  | $ Per Square Foot |
2015 |  |  | 851 |  |  |  | 42,596 |  |  | $ | 185,671 |  |  |  | 15.7% |  |  | $ | 4.36 |
2016 |  |  | 837 |  |  |  | 53,225 |  |  |  | 217,042 |  |  |  | 18.3% |  |  |  | 4.08 |
2017 |  |  | 773 |  |  |  | 51,082 |  |  |  | 224,117 |  |  |  | 18.9% |  |  |  | 4.39 |
2018 |  |  | 484 |  |  |  | 36,944 |  |  |  | 173,210 |  |  |  | 14.6% |  |  |  | 4.69 |
2019 |  |  | 395 |  |  |  | 30,749 |  |  |  | 138,710 |  |  |  | 11.7% |  |  |  | 4.51 |
2020 |  |  | 183 |  |  |  | 13,529 |  |  |  | 65,701 |  |  |  | 5.6% |  |  |  | 4.86 |
2021 |  |  | 92 |  |  |  | 10,334 |  |  |  | 43,440 |  |  |  | 3.7% |  |  |  | 4.20 |
2022 |  |  | 37 |  |  |  | 5,116 |  |  |  | 22,695 |  |  |  | 1.9% |  |  |  | 4.44 |
2023 |  |  | 41 |  |  |  | 6,145 |  |  |  | 30,735 |  |  |  | 2.6% |  |  |  | 5.00 |
2024 |  |  | 32 |  |  |  | 6,169 |  |  |  | 29,425 |  |  |  | 2.5% |  |  |  | 4.77 |
Thereafter |  |  | 38 |  |  |  | 9,509 |  |  |  | 52,927 |  |  |  | 4.5% |  |  |  | 5.60 |
|  |  | 3,763 |  |  |  | 265,398 |  |  | $ | 1,183,673 |  |  |  | 100% |  |  | $ | 4.46 |
Month to month |  |  | 181 |  |  |  | 6,126 |  |  |  |  |  |  |  |  |  |  |  |  |
Total |  |  | 3,944 |  |  |  | 271,524 |  |  |  |  |  |  |  |  |  |  |  |  |

17

##### Table of Contents

Unconsolidated Co-Investment Ventures

Included in our owned and managed portfolio are investments in real estate properties that we hold through our equity investments in unconsolidated co-investment ventures, primarily industrial properties that we also manage. Below is a summary of our unconsolidated co-investment ventures, which represents 100% of the venture, not our proportionate share, at December 31, 2014 (in thousands):

|  | Operating Properties |  |  | Development Portfolio - Total Expected Investment |  |  | Investment in Land |
Unconsolidated Co-Investment Venture |  | Square Feet |  |  | Gross Book Value |  |  |
Americas: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Prologis Targeted U.S. Logistics Fund |  |  | 50,491 |  |  | $ | 4,592,157 |  |  | $ | - |  |  | $ | - |
FIBRA Prologis |  |  | 31,364 |  |  |  | 1,755,544 |  |  |  | 11,895 |  |  |  | 1,230 |
Prologis Brazil Logistics Partners Fund (“Brazil Fund”) and related joint ventures |  |  | 5,266 |  |  |  | 414,355 |  |  |  | 154,613 |  |  |  | 147,272 |
Subtotal Americas |  |  | 87,121 |  |  |  | 6,762,056 |  |  |  | 166,508 |  |  |  | 148,502 |
Europe: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Prologis Targeted Europe Logistics Fund |  |  | 15,535 |  |  |  | 1,832,926 |  |  |  | - |  |  |  | - |
Prologis European Properties Fund II |  |  | 68,928 |  |  |  | 5,516,778 |  |  |  | 6,231 |  |  |  | 2,475 |
Europe Logistics Venture 1 |  |  | 5,257 |  |  |  | 405,761 |  |  |  | - |  |  |  | - |
Prologis European Logistics Partners Sàrl |  |  | 57,688 |  |  |  | 4,083,178 |  |  |  | 17,985 |  |  |  | 9,847 |
Subtotal Europe |  |  | 147,408 |  |  |  | 11,838,643 |  |  |  | 24,216 |  |  |  | 12,322 |
Asia: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Nippon Prologis REIT |  |  | 20,898 |  |  |  | 3,387,646 |  |  |  | - |  |  |  | - |
Prologis China Logistics Venture |  |  | 5,273 |  |  |  | 307,968 |  |  |  | 414,299 |  |  |  | 58,758 |
Subtotal Asia |  |  | 26,171 |  |  |  | 3,695,614 |  |  |  | 414,299 |  |  |  | 58,758 |
Total |  |  | 260,700 |  |  | $ | 22,296,313 |  |  | $ | 605,023 |  |  | $ | 219,582 |

For more information regarding our unconsolidated co-investment ventures, see Note 5 to the Consolidated Financial Statements in Item 8.

ITEM 3. Legal Proceedings

From time to time, we and our unconsolidated co-investment ventures are parties to a variety of legal proceedings arising in the ordinary course of business. We believe that, with respect to any such matters to which we are currently a party, the ultimate disposition of any such matter will not result in a material adverse effect on our business, financial position or results of operations.

ITEM 4. Mine Safety Disclosures

Not Applicable

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PART II

ITEM 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities

Market Information and Holders

Our common stock is listed on the NYSE under the symbol “PLD.” The following table sets forth the high and low sale price of our common stock, as reported in the NYSE Composite Tape, and the declared dividends per share, for the periods indicated.

|  | High |  |  | Low |  |  | Dividends |
2013 |  |  |  |  |  |  |  |  |  |  |  |
First Quarter |  | $ | 41.02 |  |  | $ | 37.04 |  |  | $ | 0.28 |
Second Quarter |  |  | 45.52 |  |  |  | 35.09 |  |  |  | 0.28 |
Third Quarter |  |  | 40.58 |  |  |  | 34.60 |  |  |  | 0.28 |
Fourth Quarter |  |  | 40.99 |  |  |  | 35.71 |  |  |  | 0.28 |
2014 |  |  |  |  |  |  |  |  |  |  |  |
First Quarter |  | $ | 42.10 |  |  | $ | 36.33 |  |  | $ | 0.33 |
Second Quarter |  |  | 42.66 |  |  |  | 39.72 |  |  |  | 0.33 |
Third Quarter |  |  | 42.38 |  |  |  | 37.28 |  |  |  | 0.33 |
Fourth Quarter |  |  | 44.05 |  |  |  | 37.12 |  |  |  | 0.33 |

Our future common stock dividends may vary and will be determined by our Board upon the circumstances prevailing at the time, including our financial condition, operating results, estimated taxable income and REIT distribution requirements, and may be adjusted at the discretion of the Board during the year.

On February 20, 2015, we had approximately 512,138,000 shares of common stock outstanding, which were held of record by approximately 5,290 stockholders.

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Stock Performance Graph

The following line graph compares the change in Prologis, Inc. cumulative total stockholder’s return on shares of its common stock from December 31, 2009, to the cumulative total return of the S&P 500 Stock Index and the FTSE NAREIT Equity REITs Index from December 31, 2009 to December 31, 2014. The graph assumes an initial investment of $100 in our common stock and each of the indices on December 31, 2009, and, as required by the SEC, the reinvestment of all dividends. The return shown on the graph is not necessarily indicative of future performance.

*$100 invested on 12/31/09 in stock or index, including reinvestment of dividends. Fiscal year ending December 31.

Copyright© 2015 S&P, a division of The McGraw-Hill Companies Inc. All rights reserved.

This graph and the accompanying text are not “soliciting material,” are not deemed filed with the SEC and are not to be incorporated by reference in any filing by the company under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, whether made before or after the date hereof and irrespective of any general incorporation language in any such filing.

Preferred Stock Dividends

At December 31, 2014, we had one series of preferred stock outstanding – the “series Q preferred stock.” On April 19, 2013, we redeemed all of the outstanding series L, M, O, P, R, and S preferred stock.

The following table sets forth the Company’s dividends payable per share for the years ended December 31:

|  | 2014 |  |  | 2013 |
Series L preferred stock |  |  | n/a |  |  | $ | 0.41 |
Series M, R and S preferred stock |  |  | n/a |  |  | $ | 0.42 |
Series O preferred stock |  |  | n/a |  |  | $ | 0.44 |
Series P preferred stock |  |  | n/a |  |  | $ | 0.43 |
Series Q preferred stock |  | $ | 4.27 |  |  | $ | 4.27 |

For more information regarding dividends, see Note 10 to the Consolidated Financial Statements in Item 8.

Securities Authorized for Issuance Under Equity Compensation Plans

For information regarding securities authorized for issuance under our equity compensation plans, see Notes 10 and 13 to the Consolidated Financial Statements in Item 8.

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Other Stockholder Matters

Common Stock Plans

Further information relative to our equity compensation plans will be provided in our 2015 Proxy Statement or in an amendment of this Form 10-K for further information relative to our equity compensation plans.

ITEM 6. Selected Financial Data

The following table sets forth selected financial data related to our historical financial condition and results of operations for both Prologis, Inc. and the Operating Partnership. The amounts in the tables below are in millions, except for per share/unit amounts.

|  | Years Ended December 31, |
|  | 2014 |  |  | 2013 |  |  | 2012 |  |  | 2011 (1) |  |  | 2010 (2) |
Operating Data: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Total revenues |  | $ | 1,761 |  |  | $ | 1,750 |  |  | $ | 1,961 |  |  | $ | 1,422 |  |  | $ | 827 |
Earnings (loss) from continuing operations (3) |  | $ | 739 |  |  | $ | 230 |  |  | $ | (106) |  |  | $ | (275) |  |  | $ | (1,605) |
Net earnings (loss) per share attributable to common stock/unitholders - Basic (3): |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Continuing operations (4) |  | $ | 1.25 |  |  | $ | 0.40 |  |  | $ | (0.35) |  |  | $ | (0.83) |  |  | $ | (7.42) |
Discontinued operations (4)(5) |  | $ | - |  |  | $ | 0.25 |  |  | $ | 0.17 |  |  | $ | 0.32 |  |  | $ | 1.52 |
Net earnings (loss) per share attributable to common stock/unitholders - Basic |  | $ | 1.25 |  |  | $ | 0.65 |  |  | $ | (0.18) |  |  | $ | (0.51) |  |  | $ | (5.90) |
Net earnings (loss) per share attributable to common stock/unitholders - Diluted (3): |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Continuing operations |  | $ | 1.24 |  |  | $ | 0.39 |  |  | $ | (0.34) |  |  | $ | (0.82) |  |  | $ | (7.42) |
Discontinued operations (5) |  | $ | - |  |  | $ | 0.25 |  |  | $ | 0.16 |  |  | $ | 0.31 |  |  | $ | 1.52 |
Net earnings (loss) per share attributable to common stock/unitholders - Diluted |  | $ | 1.24 |  |  | $ | 0.64 |  |  | $ | (0.18) |  |  | $ | (0.51) |  |  | $ | (5.90) |
Common share/unit distributions per share/unit (3) |  | $ | 1.32 |  |  | $ | 1.12 |  |  | $ | 1.12 |  |  | $ | 1.06 |  |  | $ | 1.25 |
Balance Sheet Data: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Total assets |  | $ | 25,818 |  |  | $ | 24,572 |  |  | $ | 27,310 |  |  | $ | 27,724 |  |  | $ | 14,903 |
Total debt |  | $ | 9,380 |  |  | $ | 9,011 |  |  | $ | 11,791 |  |  | $ | 11,382 |  |  | $ | 6,506 |
FFO (6): |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Reconciliation of net earnings (loss) to FFO: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Net earnings (loss) attributable to common shares |  | $ | 622 |  |  | $ | 315 |  |  | $ | (81) |  |  | $ | (188) |  |  | $ | (1,296) |
Total NAREIT defined adjustments |  |  | 299 |  |  |  | 504 |  |  |  | 633 |  |  |  | 660 |  |  |  | 368 |
Total our defined adjustments |  |  | (33) |  |  |  | 36 |  |  |  | - |  |  |  | (60) |  |  |  | (46) |
FFO, as defined by Prologis |  | $ | 888 |  |  | $ | 855 |  |  | $ | 552 |  |  | $ | 412 |  |  | $ | (974) |
Total core defined adjustments |  |  | 65 |  |  |  | (42) |  |  |  | 262 |  |  |  | 182 |  |  |  | 1,255 |
Core FFO (6) |  | $ | 953 |  |  | $ | 813 |  |  | $ | 814 |  |  | $ | 594 |  |  | $ | 281 |

(1) | In 2011, AMB Property Corporation (“AMB”) completed a merger (the “Merger”) with ProLogis, a Maryland REIT (“ProLogis”). In the Merger, AMB was the legal acquirer and ProLogis was the accounting acquirer. Following the Merger, AMB changed its name to Prologis, Inc. In 2011, we also completed an acquisition of one of our unconsolidated ventures in Europe. Activity in 2011 included five months of results of ProLogis, as it was the accounting acquirer in the Merger and seven months of results of the combined company resulting from the Merger and the acquisition in Europe.

(2) | 2010 includes the results of ProLogis, as it was the accounting acquirer in the Merger.

(3) | We recognized significant net gains on dispositions of investments in real estate and revaluation of equity investments upon acquisition of a controlling interest of $0.7 billion and $0.6 billion in 2014 and 2013, respectively. In 2010, we recognized impairment charges of $1.2 billion related to certain investments in real estate and goodwill. The historical shares and units of ProLogis were adjusted by the Merger exchange ratio of 0.4464 for the periods prior to the Merger. As a result, the per share/unit calculations were also adjusted.

(4) | For 2014 and 2013, the amounts for the Operating Partnership were the same as Prologis, Inc. Net earnings (loss) attributable to common unitholders for the Operating Partnership was $(0.34) and $0.16 for continuing operations and discontinued operations, respectively, in 2012, and was $(0.82) and $0.31 for continuing operations and discontinued operations, respectively, in 2011. Pre-Merger, there was no Operating Partnership.

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(5) | In 2014, the accounting standard changed for classifying and reporting discontinued operations and as such, none of our dispositions in 2014 met the qualifications to be reported as discontinued operations.

(6) | FFO; FFO, as defined by Prologis and Core FFO are non-GAAP measures used in the real estate industry. See definitions and a complete reconciliation of net earnings to FFO and Core FFO in Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

ITEM 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following discussion should be read in conjunction with the Consolidated Financial Statements included in Item 8 of this report and the matters described under Item 1A. Risk Factors.

Management’s Overview

We believe the scale and quality of our operating platform, the skills of our team and the strength of our balance sheet give us unique competitive advantages. Our plan to grow revenue, earnings, net operating income (“NOI”), cash flows and Core FFO (see below for definition) is based on:

• |  | Rising Rents. Market rents are increasing across many of our markets. We expect growth to continue as demand for logistics facilities is strong across the globe. As many of our leases originated during low rent period following the global financial crisis, there is considerable room for growth of in-place leases, which translates into increased NOI, earnings and cash flow. We had positive rent change on rollovers (when comparing the net effective rent of the new lease to the prior lease for the same space) during each quarter of 2014, ranging between 6.2% and 9.7%, and the fourth quarter marked the eighth consecutive quarter of positive rental increases.

• |  | Value Creation from Development. We believe a successful development program involves maintaining control of well-positioned land. Based on our current estimates, our land bank has the potential to support the development of nearly 180 million additional square feet. We believe the carrying value of our land bank is below its current fair value, and we expect to realize this value going forward through development or land sales. During 2014, in our owned and managed portfolio, we stabilized development projects with a total expected investment of $1.1 billion. We estimate that post-stabilization, the value of these buildings will be approximately 23.0% more than their book value or the cost to develop (defined as estimated margin and calculated using estimated yield and capitalization rates from our underwriting models).

• |  | Economies of Scale from Growth in Assets Under Management. We believe we have the infrastructure and an acquisition pipeline that will allow us to increase our investments in real estate, with minimal increases to general and administrative expenses. During 2014, our owned and managed real estate assets increased through the acquisition of $1.5 billion of buildings, principally in our unconsolidated ventures in Europe, and development starts with a total expected investment of $2.0 billion; offset partially by dispositions to third parties of $1.5 billion. With all of this activity, we had minimal incremental gross general and administrative expenses.

Summary of 2014

During the year ended December 31, 2014, we completed the following activities as further described in the Consolidated Financial Statements:

• |  | In January, we closed on a U.S. co-investment venture, Prologis U.S. Logistics Venture (“USLV”), in which we have a 55% equity ownership and consolidate for financial reporting purposes. At closing, the venture acquired a portfolio of 66 operating properties from us, aggregating 12.8 million square feet for a purchase price of $1.0 billion.

• |  | In June, we completed the initial public offering for FIBRA Prologis, a Mexican REIT on the Mexican Stock Exchange. In connection with the offering, FIBRA Prologis purchased its initial portfolio of $1.6 billion from us and two of our co-investment ventures. We received equity units in FIBRA Prologis in exchange for our combined investments resulting in a 45% ownership interest in FIBRA Prologis that we account for under the equity method.

• |  | We earned a promote of $42.1 million in June from our co-investment venture, Prologis Targeted U.S. Logistics Fund (“USLF”), which was based on the venture’s cumulative returns to the investors over the previous three calendar years. Of that amount, $31.3 million represented the third-party investors’ portion and is reflected in Strategic Capital Income in the Consolidated Statements of Operations.

• |  | We increased our ownership of Prologis North American Industrial Fund (“NAIF”) to 66.1% by acquiring equity units from all but one partner for an aggregate purchase price of $679.0 million, which resulted in us obtaining control over and consolidating NAIF. As a result of remeasuring our equity investment to fair value upon consolidation in the fourth quarter, we recognized a gain of $201.3 million.

• |  | We invested $587.2 million in three of our European unconsolidated co-investment ventures, which represented our proportionate ownership interest, for the acquisition of properties and repayment of debt.

• |  | We generated net proceeds of $3.2 billion and net gains of $524.5 million from the contribution and disposition of real estate investments, including the initial portfolio of FIBRA Prologis discussed above. The gains were principally driven by dispositions in the United States and contribution of stabilized properties in Japan and Mexico.

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• |  | We issued €1.8 billion ($2.4 billion) of senior notes, entered into a new yen term loan and replaced our euro term loan. We used the net proceeds to buy back senior notes through private transactions, repay secured mortgage debt, fund additional investments in our co-investment ventures and for general corporate purposes. This activity reduced our weighted average interest rate and extended our maturities, as further discussed below in Liquidity and Capital Resources.

• |  | In December, we received proceeds of $353.9 million through the issuance of equity securities from the exercise of a warrant issued in connection with the formation of Prologis European Logistics Partners Sàrl (“PELP”) and through our at-the-market (“ATM”) program. See Note 10 to the Consolidated Financial Statements for additional information about our ATM program.

Results of Operations

Real Estate Operations

Included in this segment is rental income and rental expense recognized from our consolidated operating properties. We had significant real estate activity during 2014 and 2013 that impacted the size of our consolidated portfolio. In addition, the operating fundamentals in the markets of our operating portfolio have been improving, which has positively impacted both the occupancy and rental rates we have experienced, and has also fueled development activity. Also included in this segment is revenue from land we own and lease to customers and development management and other income, net of acquisition, disposition and land holding costs.

Real Estate Operations NOI for the years ended December 31 was as follows (dollars in thousands):

|  | 2014 |  |  | 2013 |  |  | 2012 |
Rental and other income |  | $ | 1,192,176 |  |  | $ | 1,239,496 |  |  | $ | 1,469,419 |
Rental recoveries |  |  | 348,740 |  |  |  | 331,518 |  |  |  | 364,320 |
Rental and other expenses |  |  | (454,254) |  |  |  | (478,920) |  |  |  | (517,795) |
Real Estate Operations - NOI |  | $ | 1,086,662 |  |  | $ | 1,092,094 |  |  | $ | 1,315,944 |
Operating margin |  |  | 70.5% |  |  |  | 69.5% |  |  |  | 71.8% |
Average occupancy |  |  | 94.5% |  |  |  | 93.6% |  |  |  | 92.6% |

Detail of our consolidated operating properties at December 31 was as follows (square feet in thousands):

|  | 2014 |  |  | 2013 |  |  | 2012 |
Number of properties |  |  | 1,607 |  |  |  | 1,610 |  |  |  | 1,853 |
Square Feet |  |  | 282,282 |  |  |  | 267,097 |  |  |  | 316,347 |
Occupied % |  |  | 96.3% |  |  |  | 94.9% |  |  |  | 93.7% |

Below are the key drivers of Real Estate Operations NOI:

• |  | We had significant activity within the portfolio, including acquisitions, contributions to co-investment ventures and dispositions to third parties. This impacted NOI as follows:

2014 as compared to 2013

| • |  | Acquisitions and development activity: $84.8 million increase;

| • |  | Consolidation of NAIF: $35.8 million increase;

| • |  | Contribution activity: $140.3 million decrease;

| • |  | Disposition activity: $44.0 million decrease

2013 as compared to 2012

| • |  | Acquisitions and development activity: $71.6 million increase;

| • |  | Contribution activity: $299.4 million decrease

• |  | Average occupancy in our operating properties increased 90 basis points in 2014 from 2013 and 100 basis points in 2013 from 2012.

• |  | We leased a total of 72.9 million square feet, 87.6 million square feet and 92.4 million square feet during 2014, 2013 and 2012, respectively.

• |  | We recognize changes in rental income from certain contractual rent increases from our existing leases and from rent change on new leases. If a lease has a contractual rent increase based on the consumer price index or similar metric that is not known at the time of lease signing, the rent increase is not included in rent leveling and therefore any rent increase will impact the rental income we recognize.

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• |  | We have experienced an increase in rental rates on the turnover of existing leases for the last eight quarters that has resulted in higher average rental rates in our portfolio and increased rental income and NOI as those leases commenced.

• |  | Under the terms of our lease agreements, we are able to recover the majority of our rental expenses from customers. Rental expense recoveries, included in both rental income and rental expenses, were 81.0%, 73.4% and 74.2% of total rental expenses for the year ended December 31, 2014, 2013, and 2012 respectively. The increase was due in part to the higher average occupancy of our portfolio.

• |  | We adopted a new accounting standard, as of January 1, 2014, that changed the criteria for classifying and reporting discontinued operations. The results of the third-party dispositions remained in continuing operations in 2014, whereas in 2013 and 2012, the results were reclassified to discontinued operations and not included in Real Estate Operations.

Strategic Capital

Included in this segment is income comprised of fees and promotes earned for services performed for our unconsolidated co-investment ventures reduced by the expenses recognized for the direct costs associated with the asset management of these ventures and allocated property-level management costs for the properties owned by the ventures. Income associated with Strategic Capital fluctuates due to the size of co-investment ventures that are under management, the transactional activity in the venture and the timing of promotes. We had significant co-investment venture activity in 2014 and 2013 that impacted Strategic Capital NOI as detailed below.

Strategic Capital NOI for the years ended December 31 was as follows (in thousands):

|  | 2014 |  |  | 2013 |  |  | 2012 |
Strategic Capital - NOI: |  |  |  |  |  |  |  |  |  |  |  |
Americas: |  |  |  |  |  |  |  |  |  |  |  |
Asset management and other fees |  | $ | 51,490 |  |  | $ | 52,030 |  |  | $ | 55,448 |
Leasing commissions, acquisition and other transaction fees |  |  | 12,348 |  |  |  | 14,078 |  |  |  | 13,974 |
Promotes |  |  | 31,330 |  |  |  | 6,366 |  |  |  | - |
Strategic capital expenses |  |  | (53,126) |  |  |  | (53,689) |  |  |  | (37,785) |
Subtotal Americas |  |  | 42,042 |  |  |  | 18,785 |  |  |  | 31,637 |
Europe: |  |  |  |  |  |  |  |  |  |  |  |
Asset management and other fees |  |  | 70,539 |  |  |  | 53,190 |  |  |  | 32,951 |
Leasing commissions, acquisition and other transaction fees |  |  | 16,010 |  |  |  | 10,604 |  |  |  | 4,096 |
Strategic capital expenses |  |  | (29,283) |  |  |  | (22,531) |  |  |  | (15,348) |
Subtotal Europe |  |  | 57,266 |  |  |  | 41,263 |  |  |  | 21,699 |
Asia: |  |  |  |  |  |  |  |  |  |  |  |
Asset management and other fees |  |  | 32,252 |  |  |  | 29,861 |  |  |  | 19,026 |
Leasing commissions, acquisition and other transaction fees |  |  | 5,902 |  |  |  | 13,343 |  |  |  | 1,284 |
Strategic capital expenses |  |  | (14,087) |  |  |  | (13,059) |  |  |  | (10,687) |
Subtotal Asia |  |  | 24,067 |  |  |  | 30,145 |  |  |  | 9,623 |
Strategic Capital - NOI |  | $ | 123,375 |  |  | $ | 90,193 |  |  | $ | 62,959 |

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We had the following assets under management held through our unconsolidated co-investment ventures at December 31 as follows (dollars and square feet in millions):

|  | 2014 |  |  | 2013 |  |  | 2012 |
Americas: |  |  |  |  |  |  |  |  |  |  |  |
Number of ventures |  |  | 3 |  |  |  | 4 |  |  |  | 6 |
Square feet |  |  | 87.1 |  |  |  | 108.5 |  |  |  | 127.5 |
Total assets |  | $ | 7,063 |  |  | $ | 8,014 |  |  | $ | 9,070 |
Europe: |  |  |  |  |  |  |  |  |  |  |  |
Number of ventures |  |  | 4 |  |  |  | 4 |  |  |  | 3 |
Square feet |  |  | 147.4 |  |  |  | 132.9 |  |  |  | 70.3 |
Total assets |  | $ | 11,463 |  |  | $ | 11,819 |  |  | $ | 6,605 |
Asia: |  |  |  |  |  |  |  |  |  |  |  |
Number of ventures |  |  | 2 |  |  |  | 2 |  |  |  | 2 |
Square feet |  |  | 26.2 |  |  |  | 22.9 |  |  |  | 11.0 |
Total assets |  | $ | 4,135 |  |  | $ | 4,032 |  |  | $ | 1,937 |
Total: |  |  |  |  |  |  |  |  |  |  |  |
Number of ventures |  |  | 9 |  |  |  | 10 |  |  |  | 11 |
Square feet |  |  | 260.7 |  |  |  | 264.3 |  |  |  | 208.8 |
Total assets |  | $ | 22,661 |  |  | $ | 23,865 |  |  | $ | 17,612 |

Below are the key drivers of Strategic Capital NOI:

| • |  | We acquired a controlling interest in our co-investment venture NAIF in the fourth quarter of 2014 and began consolidating the venture.

| • |  | We formed the co-investment venture FIBRA Prologis in Mexico in June 2014 and in connection with this transaction, we concluded the Mexico Industrial Fund.

| • |  | We acquired a controlling interest in Prologis SGP Mexico and purchased our partner’s interest in Prologis North American Industrial Fund III in 2013.

| • |  | We formed two co-investment ventures in early 2013 (one in Europe and one in Japan). In connection with the formation of the Japan co-investment venture, we concluded Japan Fund I.

| • |  | We contributed 126, 254 and 25 properties to several co-investment ventures during 2014, 2013 and 2012, respectively.

| • |  | In June 2014, we earned a promote of $42.1 million from our co-investment venture USLF. Of that amount, $31.3 million represented the third-party investors’ portion and is reflected in Strategic Capital Income in the Consolidated Statements of Operations.

The direct costs associated with Strategic Capital totaled $96.5 million, $89.3 million and $63.8 million for the years ended December 31, 2014, 2013 and 2012, respectively, and are included in the line item Strategic Capital Expenses in the Consolidated Statements of Operations. These expenses include the direct expenses associated with asset management of the unconsolidated co-investment ventures and the property management expenses associated with the property-level management of the properties owned by these ventures.

The increase in Strategic Capital Expenses in 2014 from 2013 was due to the increased size of our co-investment ventures and additional expense that represents the associated bonus paid pursuant to the terms of the Prologis Promote Plan for the promote we earned, offset partially by the conclusion of several ventures. The increase in Strategic Capital Expenses in 2013 from 2012 was due to the addition of the two co-investment ventures in Europe and Asia and additional expense related to the promote we earned, offset somewhat by the conclusion of several ventures.

See Note 5 to the Consolidated Financial Statements for additional information on our unconsolidated entities.

Our Owned and Managed Portfolio

We manage our business on an owned and managed basis without regard to whether a particular property is wholly-owned by us or owned by one of our co-investment ventures. As further discussed below, we believe that the operating fundamentals of our owned and managed portfolio are consistent with those of our consolidated portfolio. The activity in our owned and managed portfolio impacts Real Estate Operations NOI, Strategic Capital revenues and the net earnings we recognize from our unconsolidated co-investment ventures.

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Our total owned and managed portfolio includes operating industrial properties and does not include properties under development or held for sale and was as follows at December 31 (square feet in millions):

|  | 2014 |  |  | 2013 |  |  | 2012 |
|  | Number of Properties |  |  | Square Feet |  |  | Occupancy |  |  | Number of Properties |  |  | Square Feet |  |  | Occupancy |  |  | Number of Properties |  |  | Square Feet |  |  | Occupancy |
Consolidated |  |  | 1,607 |  |  |  | 282.3 |  |  |  | 96.3% |  |  |  | 1,610 |  |  |  | 267.1 |  |  |  | 94.9% |  |  |  | 1,853 |  |  |  | 316.3 |  |  |  | 93.7% |
Unconsolidated |  |  | 1,278 |  |  |  | 260.7 |  |  |  | 95.0% |  |  |  | 1,323 |  |  |  | 264.3 |  |  |  | 94.7% |  |  |  | 1,163 |  |  |  | 208.8 |  |  |  | 93.8% |
Totals |  |  | 2,885 |  |  |  | 543.0 |  |  |  | 95.6% |  |  |  | 2,933 |  |  |  | 531.4 |  |  |  | 94.8% |  |  |  | 3,016 |  |  |  | 525.1 |  |  |  | 93.8% |

Operating Activity

Information on our operating activity for the years ended December 31 is summarized below (square feet in millions):

|  | 2014 |  |  | 2013 |  |  | 2012 |
Aggregate leased square feet |  |  | 130.3 |  |  |  | 151.9 |  |  |  | 145.3 |
Average turnover costs per square foot |  | $ | 1.46 |  |  | $ | 1.42 |  |  | $ | 1.38 |
Rent change on rollover (range of each quarter during the year) |  |  | 6.2 - 9.7% |  |  |  | 2.0 - 6.1% |  |  |  | (1.1) - (3.9)% |
Retention percentage on aggregate leased square feet |  |  | 85.5% |  |  |  | 82.6% |  |  |  | 87.3% |

Development Start Activity

Information on our development starts for the years ended December 31 is summarized below (dollars and square feet in millions):

|  | 2014 (1) |  |  | 2013 |  |  | 2012 |
Number of properties |  |  | 76 |  |  |  | 68 |  |  |  | 40 |
Aggregated square feet |  |  | 26.0 |  |  |  | 23.0 |  |  |  | 17.0 |
Total expected investment (“TEI”) |  | $ | 2,034 |  |  | $ | 1,771 |  |  | $ | 1,553 |
Our proportionate share of TEI based on ownership |  | $ | 1,792 |  |  | $ | 1,473 |  |  | $ | 1,359 |
Percentage of build-to-suits based on TEI |  |  | 32.6% |  |  |  | 41.8% |  |  |  | 63.8% |
Weighted average expected yield on TEI |  |  | 7.2% |  |  |  | 7.6% |  |  |  | 7.9% |
Estimated value at completion |  | $ | 2,441 |  |  | $ | 2,109 |  |  | $ | 1,834 |
Estimated margin |  |  | 20.0% |  |  |  | 19.1% |  |  |  | 18.1% |

(1) | We expect these developments to be completed on or before July 2016.

For information on our development portfolio at December 31, 2014, see Item 2. Properties.

Same Store Analysis

We evaluate the performance of the operating properties we own and manage using a “same store” analysis because the population of properties in this analysis is consistent from period to period, thereby eliminating the effects of changes in the composition of the portfolio on performance measures. We include properties from our consolidated portfolio, as well as properties owned by the unconsolidated co-investment ventures that are managed by us, in our same store analysis. We have defined the same store portfolio, for the three months ended December 31, 2014, as those properties that were in operation at January 1, 2013, and have been in operation throughout the same three-month periods in both 2014 and 2013. We have removed all properties that were disposed of to a third party or were classified as held for sale from the population for both periods. We believe the factors that impact rental income, rental expenses and NOI in the same store portfolio are generally the same as for the total portfolio. In order to derive an appropriate measure of period-to-period operating performance, we remove the effects of foreign currency exchange rate movements by using the current exchange rate to translate from local currency into U.S. dollars, for both periods.

We calculate our same store results on a quarterly basis and provide a reconciliation of those results to our Consolidated Statements of Operations. The following is a summary of same store NOI and the change from prior period for the four quarters of 2014 and on a cumulative year-to-date basis and the square feet of the portfolio used in the calculation (dollars and square feet in thousands):

|  | Three Months Ended |  |  |  |
|  | March 31 (1) |  |  | June 30 (1) |  |  | September 30 (1) |  |  | December 31 |  |  | Full Year |
2014 NOI - same store portfolio |  | $ | 586,579 |  |  | $ | 584,422 |  |  | $ | 581,912 |  |  | $ | 568,742 |  |  | $ | 2,321,655 |
2013 NOI - same store portfolio |  | $ | 569,596 |  |  | $ | 562,899 |  |  | $ | 561,270 |  |  | $ | 546,214 |  |  | $ | 2,239,979 |
Percentage change |  |  | 2.98% |  |  |  | 3.82% |  |  |  | 3.68% |  |  |  | 4.12% |  |  |  | 3.65% |
Square feet of portfolio |  |  | 505.6 |  |  |  | 496.9 |  |  |  | 490.6 |  |  |  | 487.2 |  |  |  |  |

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(1) | A reconciliation of our same store results for these fiscal quarters to our Consolidated Statements of Operations is provided in our previously filed quarterly reports on Form 10-Q for the respective quarter.

The following is a reconciliation of our consolidated rental income, rental expenses and NOI (calculated as rental income and recoveries less rental expenses) for the full year, as included in the Consolidated Statements of Operations, to the respective amounts in our same store portfolio analysis for the three months ended December 31 (dollars in thousands):

|  | Three Months Ended |  |  |  |
|  | March 31 |  |  | June 30 |  |  | September 30 |  |  | December 31 |  |  | Full Year |
2014 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Rental income and rental recoveries |  | $ | 388,240 |  |  | $ | 381,273 |  |  | $ | 355,822 |  |  | $ | 402,014 |  |  | $ | 1,527,349 |
Rental expenses |  |  | 110,517 |  |  |  | 109,576 |  |  |  | 102,324 |  |  |  | 108,370 |  |  |  | 430,787 |
NOI |  | $ | 277,723 |  |  | $ | 271,697 |  |  | $ | 253,498 |  |  | $ | 293,644 |  |  | $ | 1,096,562 |
2013 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Rental income and rental recoveries |  | $ | 444,144 |  |  | $ | 363,956 |  |  | $ | 372,185 |  |  | $ | 379,208 |  |  | $ | 1,559,493 |
Rental expenses |  |  | 130,354 |  |  |  | 109,837 |  |  |  | 106,811 |  |  |  | 104,936 |  |  |  | 451,938 |
NOI |  | $ | 313,790 |  |  | $ | 254,119 |  |  | $ | 265,374 |  |  | $ | 274,272 |  |  | $ | 1,107,555 |

|  | For the Three Months Ended December 31, |
|  | 2014 |  |  | 2013 |  |  | Percentage Change |
Rental Income (1)(2) |  |  |  |  |  |  |  |  |  |  |  |
Consolidated: |  |  |  |  |  |  |  |  |  |  |  |
Rental income per the Consolidated Statements of Operations |  | $ | 307,584 |  |  | $ | 301,627 |  |  |  |  |
Rental recoveries per the Consolidated Statements of Operations |  |  | 94,430 |  |  |  | 77,581 |  |  |  |  |
Consolidated adjustments to derive same store results: |  |  |  |  |  |  |  |  |  |  |  |
Rental income and recoveries of properties not in the same store portfolio — properties developed and acquired during the period and land subject to ground leases |  |  | (45,387) |  |  |  | (41,562) |  |  |  |  |
Effect of changes in foreign currency exchange rates and other |  |  | 112 |  |  |  | (4,467) |  |  |  |  |
Unconsolidated co-investment ventures – rental income |  |  | 412,873 |  |  |  | 402,185 |  |  |  |  |
Same store portfolio – rental income (2) |  | $ | 769,612 |  |  | $ | 735,364 |  |  |  | 4.7% |
Rental Expenses (1)(3) |  |  |  |  |  |  |  |  |  |  |  |
Consolidated: |  |  |  |  |  |  |  |  |  |  |  |
Rental expenses per the Consolidated Statements of Operations |  | $ | 108,370 |  |  | $ | 104,936 |  |  |  |  |
Consolidated adjustments to derive same store results: |  |  |  |  |  |  |  |  |  |  |  |
Rental expenses of properties not in the same store portfolio — properties developed and acquired during the period and land subject to ground leases |  |  | (13,699) |  |  |  | (12,996) |  |  |  |  |
Effect of changes in foreign currency exchange rates and other |  |  | 10,139 |  |  |  | 3,830 |  |  |  |  |
Unconsolidated co-investment ventures — rental expenses |  |  | 96,060 |  |  |  | 93,380 |  |  |  |  |
Same store portfolio – rental expenses (3) |  | $ | 200,870 |  |  | $ | 189,150 |  |  |  | 6.2% |
NOI (1) |  |  |  |  |  |  |  |  |  |  |  |
Consolidated: |  |  |  |  |  |  |  |  |  |  |  |
NOI per the Consolidated Statements of Operations |  | $ | 293,644 |  |  | $ | 274,272 |  |  |  |  |
Consolidated adjustments to derive same store results: |  |  |  |  |  |  |  |  |  |  |  |
NOI of properties not in the same store portfolio — properties developed and acquired during the period and land subject to ground leases |  |  | (31,688) |  |  |  | (28,566) |  |  |  |  |
Effect of changes in foreign currency exchange rates and other |  |  | (10,027) |  |  |  | (8,297) |  |  |  |  |
Unconsolidated co-investment ventures — NOI |  |  | 316,813 |  |  |  | 308,805 |  |  |  |  |
Same store portfolio – NOI |  | $ | 568,742 |  |  | $ | 546,214 |  |  |  | 4.1% |

(1) | As discussed above, our same store portfolio includes industrial properties from our consolidated portfolio and owned by the unconsolidated co-investment ventures that are managed by us. During the periods presented, certain properties owned by us were

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| contributed to a co-investment venture and are included in the same store portfolio on an aggregate basis. Neither our consolidated results nor those of the co-investment ventures, when viewed individually, would be comparable on a same store basis due to the changes in composition of the respective portfolios from period to period (for example, the results of a contributed property are included in our consolidated results through the contribution date and in the results of the unconsolidated entities subsequent to the contribution date).

(2) | We exclude the net termination and renegotiation fees from our same store rental income to allow us to evaluate the growth or decline in each property’s rental income without regard to items that are not indicative of the property’s recurring operating performance. Net termination and renegotiation fees represent the gross fee negotiated to allow a customer to terminate or renegotiate their lease, offset by the write-off of the asset recorded due to the adjustment to straight-line rents over the lease term. The adjustments to remove these items are included in “effect of changes in foreign currency exchange rates and other” in the above table.

(3) | Rental expenses include the direct operating expenses of the property such as property taxes, insurance, utilities, etc. In addition, we include an allocation of the property management expenses for our direct-owned properties based on the property management services provided to each property (generally, based on a percentage of revenues). On consolidation, these amounts are eliminated and the actual costs of providing property management services are recognized as part of our consolidated rental expenses. These expenses fluctuate based on the level of properties included in the same store portfolio and any adjustment is included as “effect of changes in foreign currency exchange rates and other” in the above table.

Other Components of Income

General and Administrative (“G&A”) Expenses

G&A expenses for the years ended December 31 consisted of the following (in thousands):

|  | 2014 |  |  | 2013 |  |  | 2012 |
Gross overhead |  | $ | 461,647 |  |  | $ | 434,933 |  |  | $ | 394,845 |
Reported as rental expenses |  |  | (30,075) |  |  |  | (32,918) |  |  |  | (35,954) |
Reported as strategic capital expenses |  |  | (96,496) |  |  |  | (89,278) |  |  |  | (63,820) |
Capitalized amounts |  |  | (87,308) |  |  |  | (83,530) |  |  |  | (67,003) |
G&A expenses |  | $ | 247,768 |  |  | $ | 229,207 |  |  | $ | 228,068 |

Gross overhead includes all costs related to our business, including the Real Estate Operations and Strategic Capital segments. We allocate a portion of our gross overhead that relates to property management functions to both segments based on the size of the respective portfolios. Costs directly associated to Strategic Capital are allocated to that segment.

The increase in gross overhead from 2013 to 2014 was principally due to increased compensation. The increase in gross overhead from 2012 to 2013 was primarily due to increased infrastructure to accommodate our growing business. In 2013, the gross book value for our owned and managed portfolio increased $1.4 billion to $45.5 billion at December 31, 2013.

We capitalize certain costs directly related to our development and leasing activities. Capitalized G&A expenses included salaries and related costs, as well as other general and administrative costs. The capitalized G&A costs for the years ended December 31 were as follows (in thousands):

|  | 2014 |  |  | 2013 |  |  | 2012 |
Development activities |  | $ | 68,008 |  |  | $ | 64,113 |  |  | $ | 42,417 |
Leasing activities |  |  | 17,888 |  |  |  | 18,301 |  |  |  | 23,183 |
Costs related to internally developed software |  |  | 1,412 |  |  |  | 1,116 |  |  |  | 1,403 |
Total capitalized G&A expenses |  | $ | 87,308 |  |  | $ | 83,530 |  |  | $ | 67,003 |

In 2014, 2013 and 2012, the capitalized salaries and related costs represented 23.9%, 23.7% and 20.3%, respectively, of our total salaries and related costs, which includes cash and equity compensation and other employee-related expenses.

Depreciation and Amortization

Depreciation and amortization was $642.5 million, $648.7 million and $724.3 million for 2014, 2013 and 2012, respectively. The decrease over the last two years was principally a result of the disposition and contribution of properties, offset slightly by additional depreciation and amortization from completed development and acquired properties.

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Merger, Acquisition and Other Integration Expenses

We incurred significant transaction, integration and transitional costs in 2012 related to the Merger in 2011 and integration of systems. See Note 14 to the Consolidated Financial Statements for more detail on these expenses.

Impairment of Real Estate Properties

During 2012, we recognized impairment charges of real estate properties in continuing operations due to our change of intent to no longer hold certain assets for long-term investment. See Notes 2 and 15 to the Consolidated Financial Statements for more detail on the process we took to value these assets and the related impairment charges recognized.

Earnings from Unconsolidated Entities, Net

We recognized net earnings from unconsolidated entities that are accounted for under the equity method of $134.3 million, $97.2 million and $31.7 million for 2014, 2013 and 2012, respectively. The earnings we recognize are impacted by: (i) changes in revenues and expenses of each venture; (ii) the size and occupancy rate of the portfolio of properties owned by each venture; (iii) our ownership interest in each venture; and (iv) fluctuations in foreign currency exchange rates used to translate our share of net earnings to U.S. dollars, if applicable. See the discussion of our co-investment ventures above in the Strategic Capital segment discussion and in Note 5 to the Consolidated Financial Statements for a further breakdown of our share of net earnings recognized.

Interest Expense

Gross interest expense decreased in 2014, compared to 2013, due to lower average debt levels and a decrease in interest rates. Although our debt levels were consistent at year ends ($9.4 billion at December 31, 2014 compared to $9.0 billion at December 31, 2013), we had higher debt outstanding during the first quarter of 2013. We decreased our debt by $2.7 billion near the end of the first quarter of 2013, primarily from the proceeds received from the contributions made to our unconsolidated co-investment ventures.

Gross interest expense decreased in 2013 compared to 2012 due to lower debt levels.

Our weighted average effective interest rate was 4.2%, 4.7% and 4.6% for 2014, 2013 and 2012, respectively. During 2014, 2013 and 2012, we issued new debt with lower borrowing costs and used the proceeds to pay down or buy back our higher cost debt.

See Note 9 to the Consolidated Financial Statements for a further breakdown of gross interest expense, amortization and capitalized amounts included in net interest expense.

See also Liquidity and Capital Resources for further discussion of our debt and borrowing costs.

Gains on Dispositions of Investments in Real Estate and Revaluation of Equity Investments upon Acquisition of a Controlling Interest, Net

We recognized $0.7 billion, $0.6 billion and $0.3 billion in continuing operations during 2014, 2013 and 2012, respectively. In 2014, these also included gains on the dispositions of properties to third parties due to the change in reporting under the new accounting standard. We expect to have contributions to co-investments in the future, primarily in Europe, Japan and Mexico, as well as the disposition of properties to third parties, primarily in the U.S., all depending on market conditions and other factors. See Note 4 to the Consolidated Financial Statements for further information on the gains we recognized.

Foreign Currency and Derivative Gains (Losses), Net

To mitigate our foreign currency exchange exposure, we borrow in the functional currency of the borrowing entity when appropriate. However, we and certain of our foreign consolidated subsidiaries have intercompany or third-party debt that is not denominated in the entity’s functional currency. When the debt is remeasured against the functional currency of the entity, a gain or loss may result. Certain of our third-party and intercompany debt is remeasured with the resulting adjustment recognized as a cumulative translation adjustment in Foreign Currency Translation Losses, Net in the Consolidated Statements of Comprehensive Income (Loss). This treatment is applicable to third-party debt that is designated as a hedge of our net investment and intercompany debt that is deemed to be long-term in nature.

If the third-party debt is not designated as a hedge or the intercompany debt is deemed short-term in nature we recognize a gain or loss in earnings when the debt is remeasured. We recognized net foreign currency exchange losses of $4.5 million in 2014 and exchange gains of $9.2 million and $7.4 million in 2013 and 2012, respectively, related to the settlement and remeasurement of debt. Predominantly the gains or losses recognized in earnings relate to the remeasurement of intercompany loans between the United States parent and certain consolidated subsidiaries in Japan and Europe and result from fluctuations in the exchange rates of U.S. dollar to the euro, Japanese yen and British pound sterling. In addition, we recognized net foreign currency exchange losses of $0.6 million, $0.6 million and $5.6 million from the settlement of transactions with third parties of certain assets or liabilities that are denominated in a currency other than an entity’s functional currency in 2014, 2013 and 2012, respectively.

We recognized unrealized losses of $13.3 million, $42.2 million and $22.3 million in 2014, 2013 and 2012, respectively on the derivative instrument (exchange feature) related to our exchangeable senior notes, which are due in March 2015.

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Gains (Losses) on Early Extinguishment of Debt, Net

During 2014, 2013 and 2012, we purchased portions of several series of senior notes, senior exchangeable notes and extinguished some secured mortgage debt prior to maturity, which resulted in the recognition of losses of $165.3 million, $277.0 million and $14.1 million in 2014, 2013 and 2012, respectively. See Note 9 to the Consolidated Financial Statements for more information regarding our debt repurchases.

Income Tax Benefit (Expense)

During 2014, 2013 and 2012, our current income tax expense was $61.6 million, $126.2 million and $17.9 million, respectively. We recognize current income tax expense for income taxes incurred by our taxable REIT subsidiaries (“TRSs”), state and local income taxes and taxes incurred in our foreign jurisdictions. Our current income tax expense fluctuates from period to period based primarily on the timing of our taxable income. Current income tax expense recognized during 2014 is principally due to tax triggered upon the contribution of the initial portfolio of properties by certain wholly-owned entities and Mexico Fondo Logistico (“AFORES”) to FIBRA Prologis, as the transaction was structured as an asset sale for Mexican tax purposes. The tax expense was offset slightly by the net current tax benefit from the operating losses generated by our United States TRS. The current tax expense recognized during 2013 was due to the initial contribution of certain properties to PELP and NPR that were previously held in foreign jurisdictions and United States TRSs.

During 2014, 2013 and 2012, we recognized a deferred tax benefit of $87.2 million, $19.4 million and $14.3 million, respectively. Deferred income tax benefit (expense) is generally a function of the period’s temporary differences and the utilization of net operating losses generated in prior years that had been previously recognized as deferred income tax assets in taxable subsidiaries operating in the United States or in foreign jurisdictions. During 2014, the majority of the deferred tax benefit we recognized was a result of the reversal of deferred tax liabilities of $62.8 million as part of the FIBRA Prologis transaction ($30.4 million was offset by current income tax expense) and $27.1 million due to the expiration of the holding period on properties previously acquired with existing built-in gains.

Our income taxes are discussed in more detail in Note 16 to the Consolidated Financial Statements.

Discontinued Operations

As discussed above, we adopted a new accounting standard regarding discontinued operations effective January 1, 2014, and none of our property dispositions in 2014 met the criteria to be classified as discontinued operations. In 2014, 2013 and 2012, earnings from discontinued operations were $123.5 million and $75.9 million, respectively. Discontinued operations under the previous standard represent the results of operations of properties that were sold to third parties along with the related gain or loss on sale.

Net Earnings Attributable to Noncontrolling Interests

This amount represents the third-party investors’ share of the earnings generated in consolidated ventures in which we do not own 100% of the equity, as well as the limited partners’ interests in the Operating Partnership. In 2014, we recognized net earnings attributable to noncontrolling interests in AFORES of $64.8 million due to the FIBRA Prologis transaction, primarily related to the third-party investors’ share of the gain on disposition and the net deferred income tax benefit.

In 2013, we earned a promote of $18.8 million from the cumulative returns of the investors of our consolidated co-investment venture, Prologis Institutional Alliance Fund II, over the life of the venture. Of that amount, $13.5 million represents the third-party investors’ portion and is reflected as a component of noncontrolling interest.

See Note 12 to the Consolidated Financial Statements for further information on our consolidated co-investment ventures.

Other Comprehensive Income (Loss) – Foreign Currency Translation Losses, Net

We recognized unrealized gains or losses related to the translation of our foreign subsidiaries’ assets and liabilities into U.S. dollars, along with realized and unrealized gains or losses associated with the changes in the fair value of derivative and non-derivative financial instruments that are designated and qualify as hedges of net investments in foreign operations. During 2014, we recorded net losses of $171.4 million principally due to the weakening of the Japanese yen, euro and British pound sterling to the U.S. dollar, from the beginning of the period to the end of the period. In 2013, we recorded net losses of $234.7 million, which included approximately $190 million of foreign currency translation losses on the properties contributed to PELP and NPR due to the weakening of the euro and Japanese yen, respectively, to the U.S. dollar from December 31, 2012, through the date of the contributions. Also in 2013, we recorded net unrealized losses due to the weakening of the Japanese yen to the U.S. dollar, from the beginning of the period to the end of the period. During 2012, we recorded net losses of $79.0 million as the Japanese yen weakened relative to the U.S. dollar, offset slightly by the euro and British pound sterling slightly strengthening against the U.S. dollar, from the beginning of the period to the end of the period. See Note 18 in the Consolidated Financial Statements for further detail.

Environmental Matters

A majority of the properties acquired by us were subjected to environmental reviews either by us or the previous owners. While some of these assessments have led to further investigation and sampling, none of the environmental assessments have revealed an environmental liability that we believe would have a material adverse effect on our business, financial condition or results of operations.

See Note 19 in the Consolidated Financial Statements for further information about environmental liabilities.

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Liquidity and Capital Resources

Overview

We consider our ability to generate cash from operating activities, dispositions of properties and from available financing sources to be adequate to meet our anticipated future development, acquisition, operating, debt service, dividend and distribution requirements.

Near-Term Principal Cash Sources and Uses

In addition to dividends to the common and preferred stockholders of Prologis and distributions to the holders of limited partnership units of the Operating Partnership and other partnerships, we expect our primary cash needs will consist of the following:

| • |  | repayment of debt, including payments on our credit facilities and scheduled principal payments in 2015 of $599 million (which includes $460 million due March 15, 2015, on exchangeable/convertible notes that are exchangeable/convertible at a rate of 25.8244 shares of our common stock per $1,000 principal amount of notes (equivalent to an exchange or conversion price of $38.72));

| • |  | completion of the development and leasing of the properties in our consolidated development portfolio (we had 79 properties at December 31, 2014, in our development portfolio that were 46.7% leased with a current investment of $1.5 billion and a total expected investment of $2.5 billion when completed and leased, leaving $1.0 billion remaining to be spent);

| • |  | development of new properties for long-term investment, including the acquisition of land in certain markets;

| • |  | capital expenditures and leasing costs on properties in our operating portfolio;

| • |  | additional investments in current unconsolidated entities or new investments in future unconsolidated entities;

| • |  | depending on market and other conditions, acquisition of operating properties and/or portfolios of operating properties in global or regional markets for direct, long-term investment in our consolidated portfolio (this might include acquisitions from our co-investment ventures); and

| • |  | depending on prevailing market conditions, our liquidity requirements, contractual restrictions and other factors, we may repurchase our outstanding debt or equity securities through cash purchases, in open market purchases, privately negotiated transactions, tender offers or otherwise.

We expect to fund our cash needs principally from the following sources, all subject to market conditions:

| • |  | available unrestricted cash balances ($350.7 million at December 31, 2014);

| • |  | property operations;

| • |  | fees earned for services performed on behalf of the co-investment ventures and distributions received from the co-investment ventures;

| • |  | proceeds from the disposition of properties, land parcels or other investments to third parties;

| • |  | proceeds from the contributions of properties to current or future co-investment ventures;

| • |  | borrowing capacity under our current credit facility arrangements discussed below ($2.7 billion available at December 31, 2014), other facilities or borrowing arrangements;

| • |  | proceeds from the issuance of equity securities, including through the ATM program (we issued 3.3 million shares of common stock in 2014, generating net proceeds of $140.1 million – see Note 10 to the Consolidated Financial Statements for details on this program); and

| • |  | proceeds from the issuance of debt securities, including secured mortgage debt.

Debt

Debt balances at December 31 consisted of the following (dollars in millions):

|  | 2014 |  |  | 2013 |
Debt outstanding |  | $ | 9,380 |  |  | $ | 9,011 |
Weighted average interest rate |  |  | 3.6% |  |  |  | 4.2% |
Weighted average maturity (in months) |  |  | 70 |  |  |  | 58 |

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In order to economically hedge our investment in Europe, reduce our borrowing costs and extend our maturities, during 2014 we issued several series of notes denominated in euro, as follows (dollars and euros in thousands):

2014 |  | Principal Amount |  |  | Interest Rate |  |  | Effective Interest Rate |  |  | Maturity Date |
February 2014 |  | € | 700,000 |  |  | $ | 959,420 |  |  |  | 3.375% |  |  |  | 3.52% |  |  |  | February 2024 |
June 2014 |  | € | 500,000 |  |  | $ | 680,550 |  |  |  | 3.000% |  |  |  | 3.10% |  |  |  | June 2026 |
October 2014 |  | € | 600,000 |  |  | $ | 756,420 |  |  |  | 1.375% |  |  |  | 1.40% |  |  |  | October 2020 |

We used the proceeds from these issuances to repay or redeem $1.3 billion of outstanding senior notes scheduled to mature in 2015 through 2022, secured mortgage debt of $528.0 million, fund additional investments in our co-investment ventures and general corporate purposes.

In 2014, we terminated our existing senior term loan agreement and entered into a new agreement under which loans can be obtained in U.S. dollars, euro, Japanese yen and British pounds sterling in an aggregate amount not to exceed €500 million ($607.1 million at December 31, 2014). We may pay down and re-borrow under this arrangement. We had borrowings of €190 million ($230.7 million at December 31, 2014). We also entered into a Japanese yen term loan under which we may obtain loans in an aggregate amount not to exceed ¥40.9 billion ($342.1 million at December 31, 2014). We had fully drawn this term loan at December 31, 2014.

At December 31, 2014, we had credit facilities with an aggregate borrowing capacity of $2.7 billion, all of which was available for borrowing.

At December 31, 2014, we were in compliance with all of our debt covenants, which include customary financial covenants for total debt ratios, encumbered debt ratios and fixed charge coverage ratios.

See Note 9 to the Consolidated Financial Statements for further information on our debt.

Equity Commitments Related to Certain Co-Investment Ventures

Certain co-investment ventures have equity commitments from us and our venture partners. Our venture partners fulfill their equity commitment with cash. We may fulfill our equity commitment through contributions of properties or cash. For more information on equity commitments for our unconsolidated co-investment ventures, see Note 5 to the Consolidated Financial Statements. We have one consolidated co-investment venture, the Brazil Fund, with equity commitments at December 31, 2014, of $75.4 million, of which $37.7 million is our share and expires in December 2017. The equity commitments are denominated in Brazilian real and called and reported in U.S. dollars.

Cash Provided by Operating Activities

Net cash provided by operating activities was $704.5 million, $485.0 million and $463.5 million for the years ended December 31, 2014, 2013 and 2012, respectively. In 2013 and 2012, cash provided by operating activities was less than the cash dividends paid on common and preferred stock by $88.9 million and $104.3 million, respectively. In both years, we used a portion of the cash proceeds from the disposition of real estate properties ($5.4 billion in 2013 and $2.0 billion in 2012) to fund dividends not covered by cash flows from operating activities.

Cash Investing and Cash Financing Activities

For the years ended December 31, 2014, 2013 and 2012, investing activities used net cash of $488.3 million and provided net cash of $2.3 billion and $529.6 million, respectively. The following are the significant activities for all periods presented:

| • |  | Real estate development. In 2014, 2013 and 2012, we invested $1.1 billion, $845.2 million and $793.3 million, respectively, in real estate development and leasing costs for first generation leases. We have 55 properties under development and 24 properties that were completed but not stabilized at December 31, 2014, and we expect to continue to develop new properties as the opportunities arise.

| • |  | Real estate acquisitions. In 2014, we acquired total real estate of $612.3 million, which included 1,055 acres of land and eight operating properties. In 2013, we acquired 536 acres of land and 26 operating properties for a combined total of $514.6 million, which includes properties acquired in connection with the wind-down of Prologis Japan Fund I. In 2012, we acquired 1,537 acres of land and 12 operating properties for a combined total of $254.4 million.

| • |  | Capital expenditures. We invested $212.6 million, $228.0 million and $214.2 million in our operating properties during 2014, 2013 and 2012, respectively, which included recurring capital expenditures, tenant improvements and leasing commissions on existing operating properties that were previously leased.

| • |  | Investments in and advances to. In 2014, 2013 and 2012, we invested cash of $739.6 million, $1.2 billion and $165.0 million, respectively, in our unconsolidated co-investment ventures and other ventures, net of repayment of advances. Our investment in 2014 principally relates to additional investments in PELP of $461.2 million, Brazil Fund and related joint ventures of $66.3 million, Prologis Targeted Europe Logistics Fund of $72.9 million, NPR of $56.6 million and Prologis European Properties Fund II of $53.1 million, in each case, representing our proportionate share. The co-investment ventures used these investments for the acquisition of operating properties, the repayment of debt by the ventures and development costs. Our investment in 2013

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| principally relates to our investment in NPR of $411.5 million, Prologis Targeted Europe Logistics Fund of $210.2 million, Prologis European Properties Fund II of $167.2 million, PELP of $162.3 million, Brazil Fund and related joint ventures of $111.5 million and Prologis Targeted U.S. Logistics Fund of $104.8 million. See Note 5 to the Consolidated Financial Statements for more detail on these investments.

| • |  | Return of investment. We received distributions from unconsolidated co-investment ventures and other ventures as a return of investment of $244.3 million, $411.9 million and $291.7 million during 2014, 2013 and 2012, respectively. In 2013, we received $106.3 million in connection with the wind down of Prologis Japan Fund I. During 2012, we received $95.0 million, which represented a return of capital from one of our other joint ventures that held a note receivable that was repaid.

| • |  | Proceeds from dispositions and contributions. We generated cash from dispositions and contributions of real estate properties of $2.3 billion in 2014, $5.4 billion in 2013 and $2.0 billion in 2012. In 2014, we contributed 115 real estate properties owned on a consolidated basis to FIBRA Prologis and received cash proceeds of $390.6 million, primarily attributable to the third-party partners in AFORES and subsequently distributed the proceeds to them. We also disposed of land, ground leases and 145 operating properties to third parties and contributed 11 operating properties to unconsolidated co-investment ventures. In 2013, we disposed of land and 89 operating properties to third parties and contributed 254 operating properties to unconsolidated co-investment ventures. The activity in 2013 primarily included the contribution of real estate properties to our co-investment ventures, PELP and NPR of $1.3 billion and $1.9 billion, respectively. In 2012, we disposed of land and 200 operating properties to third parties and contributed 25 operating properties to unconsolidated co-investment ventures.

| • |  | Purchase of a controlling interest. In 2014, we paid net cash of $590.4 million to acquire a controlling interest in NAIF. In 2013, we paid net cash of $678.6 million to acquire our partners’ interest in Prologis North American Industrial Fund III and SGP Mexico. In connection with the acquisition of Prologis North American Industrial Fund II (“NAIF II”) in 2012, we repaid the loan from NAIF II to our partner for a total of $336.1 million. The loan repayment was reduced by the cash acquired in the consolidation of NAIF II. Also in 2012, we paid $47.8 million in connection with the acquisition of two of our unconsolidated co-investment ventures.

| • |  | Proceeds from repayment of notes receivable. In June 2014, we received $188.0 million for the payment in full of the notes receivable backed by real estate that originated in 2010 through the sale of a portfolio of industrial properties. In 2012, we received a full redemption of a $55.0 million note receivable that was issued in 2011 through the sale of non-industrial assets.

For the years ended December 31, 2014, 2013 and 2012, financing activities used net cash of $337.8 million and $2.4 billion and $1.1 billion, respectively. The following are the significant activities for all periods presented:

| • |  | Proceeds from issuance of common stock.

| • |  | In December 2014, we received gross proceeds of $142.1 million from the issuance of 3.3 million shares of common stock from our ATM program. In April 2013, we received net proceeds of $1.4 billion from the issuance of 35.65 million shares of common stock.

| • |  | In December 2014, Norges Bank Investment Management exercised a warrant for $213.8 million in exchange for six million shares of Prologis common stock. See Note 4 to the Consolidated Financial Statements for more detail.

| • |  | We generated proceeds from the issuance of common stock under our incentive plans, primarily from the exercise of stock options, of $22.3 million, $22.4 million and $31.0 million in 2014, 2013 and 2012, respectively.

| • |  | Dividends paid on common and preferred stock. We paid dividends of $672.2 million, $573.9 million and $567.8 million to our common and preferred stockholders during 2014, 2013 and 2012, respectively.

| • |  | Redemption and repurchase of preferred stock. In 2014, we paid $27.6 million to repurchase shares of series Q preferred stock. In 2013, we paid $482.5 million to redeem all of the outstanding series L, M, O, P, R and S of preferred stock.

| • |  | Noncontrolling interest contributions. In 2014, 2013 and 2012, partners in consolidated co-investment ventures made contributions of $468.3 million, $145.5 million and $70.8 million, respectively. In 2014, the contributions were primarily related to the newly formed co-investment venture USLV. In 2013 and 2012, contributions from noncontrolling interest partners were primarily for the purchase of real estate properties by AFORES and development within Brazil Fund and related joint ventures.

| • |  | Noncontrolling interest distributions. We distributed $315.4 million, $116.0 million and $44.1 million to various noncontrolling interests in 2014, 2013 and 2012, respectively. The distributions in 2014 were principally related to a cash distribution of $249.9 million to our partners in AFORES due to buildings contributed to FIBRA Prologis and $28.6 million to our partners in Prologis AMS due to the disposition of the remaining properties of the venture. Distributions in 2013 include cash distributions of $40.6 million to our partners in Prologis AMS due to the disposition of a portfolio of properties.

| • |  | Purchase of noncontrolling interest. In 2013, we purchased our partner’s interest in Prologis Alliance Fund II (“Fund II”), a consolidated co-investment venture, for $245.8 million. In 2012, we purchased an additional interest in ProLogis European Properties (“PEPR”) for $117.3 million and Fund II for $14.1 million.

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| • |  | Net proceeds from (payments on) credit facilities. We made net payments of $717.4 million and $93.1 million in 2014 and 2013 respectively, on our credit facilities and received net proceeds of $9.1 million in 2012 from our credit facilities.

| • |  | Repurchase and payment of debt. During 2014, we made payments of $2.2 billion on our previous term loan, $0.1 billion on regularly scheduled debt principal payments and payments at maturity and repurchased and extinguished exchangeable senior notes and secured mortgage debt of $1.9 billion. During 2013, we repurchased and extinguished exchangeable senior notes, secured mortgage debt, senior term loans and other debt of consolidated entities and made regularly scheduled debt principal payments and payments at maturity for a combined total of $6.0 billion. During 2012, we extinguished certain senior notes, exchangeable senior notes, secured mortgage debt, senior term loans, other debt and made regularly scheduled debt principal payments and payments at maturity for a combined total of $1.9 billion.

| • |  | Proceeds from the issuance of debt. In 2014, we issued €1.8 billion ($2.4 billion) of senior notes, $2.3 billion of term loans and $70.7 million of secured debt. In 2013, we issued senior notes, secured mortgage debt, term loan debt and other debt of $3.6 billion. In 2012, we issued $1.4 billion of debt, principally secured mortgage debt and senior term loan debt. See Note 9 to the Consolidated Financial Statements for more detail on the senior note issuances in 2014.

Off-Balance Sheet Arrangements

Unconsolidated Co-Investment Ventures Debt

We had investments in and advances to our unconsolidated co-investment ventures, at December 31, 2014, of $4.7 billion. These ventures had total third-party debt of $6.6 billion (of which $1.9 billion was our proportionate share) at December 31, 2014. This debt is primarily secured, is non-recourse to Prologis or the other investors in the co-investment ventures and matures as follows (dollars in millions):

|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | Weighted Average Interest Rate |  |  | Prologis Share |
|  | 2015 |  |  | 2016 |  |  | 2017 |  |  | Thereafter |  |  | Disc/ Prem |  |  | Total |  |  |  | $ |  |  | % |
Prologis Targeted U.S. Logistics Fund |  | $ | 149 |  |  | $ | 158 |  |  | $ | 14 |  |  | $ | 1,268 |  |  | $ | 9 |  |  | $ | 1,598 |  |  |  | 4.6% |  |  | $ | 389 |  |  |  | 24.3 | %
FIBRA Prologis |  |  | 9 |  |  |  | 252 |  |  |  | 216 |  |  |  | 172 |  |  |  | 32 |  |  |  | 681 |  |  |  | 5.3% |  |  |  | 312 |  |  |  | 45.9 | %
Prologis Targeted Europe Logistics Fund |  |  | 4 |  |  |  | 4 |  |  |  | 4 |  |  |  | 468 |  |  |  | - |  |  |  | 480 |  |  |  | 2.6% |  |  |  | 207 |  |  |  | 43.2 | %
Prologis European Properties Fund II |  |  | 270 |  |  |  | 195 |  |  |  | 76 |  |  |  | 1,421 |  |  |  | (6) |  |  |  | 1,956 |  |  |  | 3.8% |  |  |  | 608 |  |  |  | 31.1 | %
Prologis European Logistics Partners Sàrl |  |  | 3 |  |  |  | 203 |  |  |  | - |  |  |  | - |  |  |  | 2 |  |  |  | 208 |  |  |  | 3.8% |  |  |  | 104 |  |  |  | 50.0 | %
Nippon Prologis REIT |  |  | - |  |  |  | 195 |  |  |  | 19 |  |  |  | 1,142 |  |  |  | 3 |  |  |  | 1,359 |  |  |  | 1.1% |  |  |  | 205 |  |  |  | 15.1 | %
Prologis China Logistics Venture |  |  | 173 |  |  |  | - |  |  |  | - |  |  |  | 120 |  |  |  | - |  |  |  | 293 |  |  |  | 3.1% |  |  |  | 44 |  |  |  | 15.0 | %
Total co-investment ventures |  | $ | 608 |  |  | $ | 1,007 |  |  | $ | 329 |  |  | $ | 4,591 |  |  | $ | 40 |  |  | $ | 6,575 |  |  |  | 3.5% |  |  | $ | 1,869 |  |  |  |  |

At December 31, 2014, we did not guarantee any third-party debt of the co-investment ventures. In our role as the manager, we work with the co-investment ventures to refinance their maturing debt. There can be no assurance that the co-investment ventures will be able to refinance any maturing indebtedness on terms as favorable as the maturing debt, or at all. If the ventures are unable to refinance the maturing indebtedness with newly issued debt, they may be able to obtain funds by voluntary capital contributions from us and our partners or by selling assets. Certain of the ventures also have credit facilities, or unencumbered properties, both of which may be used to obtain funds.

Contractual Obligations

Long-Term Contractual Obligations

We had long-term contractual obligations at December 31, 2014 as follows (in millions):

|  | Payments Due By Period |
|  | Less than 1 year |  |  | 1 to 3 years |  |  | 3 to 5 years |  |  | More than 5 years |  |  | Total |
Debt obligations, other than credit facilities and exchangeable debt |  | $ | 139 |  |  | $ | 1,712 |  |  | $ | 1,520 |  |  | $ | 5,462 |  |  | $ | 8,833 |
Interest on debt obligations, other than credit facilities and exchangeable debt |  |  | 352 |  |  |  | 623 |  |  |  | 471 |  |  |  | - |  |  |  | 1,446 |
Exchangeable debt |  |  | 460 |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 460 |
Interest on exchangeable debt |  |  | 3 |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 3 |
Unfunded commitments on the development portfolio (1) |  |  | 746 |  |  |  | 193 |  |  |  | - |  |  |  | - |  |  |  | 939 |
Operating lease payments |  |  | 32 |  |  |  | 58 |  |  |  | 51 |  |  |  | 392 |  |  |  | 533 |
Total |  | $ | 1,732 |  |  | $ | 2,586 |  |  | $ | 2,042 |  |  | $ | 5,854 |  |  | $ | 12,214 |

(1) | We had properties in our development portfolio (completed and under development) at December 31, 2014, with a total expected investment of $2.5 billion. The unfunded commitments presented include not only those costs that we are obligated to fund under construction contracts, but all costs necessary to place the property into service, including the estimated costs of tenant improvements, marketing and leasing costs that we will incur as the property is leased.

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Distribution and Dividend Requirements

Our dividend policy on our common stock is to distribute a percentage of our cash flow to ensure we will meet the dividend requirements of the Internal Revenue Code, relative to maintaining our real estate investment trust status, while still allowing us to retain cash to meet other needs such as capital improvements and other investment activities.

In 2014 and 2013, we paid a quarterly cash dividend of $0.33 and $0.28 per common share, respectively. Our future common stock dividends may vary and will be determined by our board of directors upon the circumstances prevailing at the time, including our financial condition, operating results and real estate investment trust distribution requirements, and may be adjusted at the discretion of the board of directors during the year.

At December 31, 2014, we had one series of preferred stock outstanding – series Q. The annual dividend rate is 8.54% per share and dividends are payable quarterly in arrears.

Pursuant to the terms of our preferred stock, we are restricted from declaring or paying any dividend with respect to our common stock unless and until all cumulative dividends with respect to the preferred stock have been paid and sufficient funds have been set aside for dividends that have been declared for the relevant dividend period with respect to the preferred stock.

Other Commitments

On a continuing basis, we are engaged in various stages of negotiations for the acquisition and/or disposition of individual properties or portfolios of properties.

Critical Accounting Policies

A critical accounting policy is one that is both important to the portrayal of an entity’s financial condition and results of operations and requires judgment on the part of management. Generally, the judgment requires management to make estimates and assumptions about the effect of matters that are inherently uncertain. Estimates are prepared using management’s best judgment, after considering past and current economic conditions and expectations for the future. Changes in estimates could affect our financial position and specific items in our results of operations that are used by stockholders, potential investors, industry analysts and lenders in their evaluation of our performance. Of the accounting policies discussed in Note 2 to the Consolidated Financial Statements, those presented below have been identified by us as critical accounting policies.

Consolidation

We consolidate all entities that are wholly-owned and those in which we own less than 100% of the equity but control, as well as any variable interest entities in which we are the primary beneficiary. We evaluate our ability to control an entity and whether the entity is a variable interest entity and we are the primary beneficiary through consideration of the substantive terms of the arrangement to identify which enterprise has the power to direct the activities of the entity that most significantly impacts the entity’s economic performance and the obligation to absorb losses of the entity or the right to receive benefits from the entity. Investments in entities that we do not control but over which we have the ability to exercise significant influence over operating and financial policies are presented under the equity method. Our ability to correctly assess our influence and/or control over an entity affects the presentation of these investments in the Consolidated Financial Statements.

Business Combinations

Upon acquisition of real estate that constitutes a business, which includes acquiring a controlling interest in an entity previously accounted for under the equity method of accounting, we allocate the purchase price to the various components of the acquisition based upon the fair value of each component. The components typically include land, building, debt, intangible assets related to above and below market leases, value of costs to obtain tenants, deferred tax liability and other assumed assets and liabilities in the case of an acquisition of a business. In an acquisition of multiple properties, we must also allocate the purchase price among the properties. The allocation of the purchase price is based on our assessment of estimated fair value and often is based upon the expected future cash flows of the property and various characteristics of the markets where the property is located. The fair value may also include an enterprise value premium that we estimate a third party would be willing to pay for a portfolio of properties. In the case of an acquisition of a controlling interest in an entity previously accounted for under the equity method of accounting, this allocation may result in a gain or a loss. The initial allocation of the purchase price is based on management’s preliminary assessment, which may differ when final information becomes available. Subsequent adjustments made to the initial purchase price allocation are made within the allocation period, not to exceed one year.

Capitalization of Costs and Depreciation

We capitalize costs incurred in developing, renovating, rehabilitating and improving real estate assets as part of the investment basis. Costs incurred in making repairs and maintaining real estate assets are expensed as incurred. During the land development and construction periods, we capitalize interest costs, insurance, real estate taxes and certain general and administrative costs of the personnel performing development, renovations and rehabilitation if such costs are incremental and identifiable to a specific activity to get the asset ready for its intended use. Capitalized costs are included in the investment basis of real estate assets.

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We estimate the depreciable portion of our real estate assets and related useful lives in order to record depreciation expense. Our ability to estimate the depreciable portions of our real estate assets and useful lives is critical to the determination of the appropriate amount of depreciation expense recorded and the carrying value of the underlying assets. Any change to the assets to be depreciated and the estimated depreciable lives of these assets would have an impact on the depreciation expense recognized.

Revenue Recognition – Gains on Disposition of Real Estate and Strategic Capital Income

We recognize gains from the contributions and sales of real estate assets, generally at the time the title is transferred, consideration is received and we no longer have substantial continuing involvement with the real estate sold. In many of our transactions, an entity in which we have an equity investment will acquire a real estate asset from us. We make judgments based on the specific terms of each transaction as to the amount of the total profit from the transaction that we recognize given our continuing ownership interest and our level of future involvement with the entity that acquires the assets. In addition, we make judgments regarding recognition in earnings of certain fees and incentives earned for services provided to these entities based on when they are earned, fixed and determinable.

Other than Temporary Impairment of Investments in Unconsolidated Entities

When circumstances indicate there may have been a reduction in the value of an equity investment, we evaluate whether the loss in value is other than temporary. If we determine there is a loss in value that is other than temporary, we recognize an impairment charge to reflect the investment at fair value. The use of projected future cash flows and other estimates of fair value, the determination of when a loss is other than temporary and the calculation of the amount of the loss is complex and subjective. Use of other estimates and assumptions may result in different conclusions. Changes in economic and operating conditions, as well as changes in our intent with regard to our investment that occur subsequent to our review, could impact these assumptions and result in future impairment charges of our equity investments.

Derivative Financial Instruments

Derivatives instruments can be designated as fair value hedges, cash flow hedges or hedges of net investments in foreign operations. We do not use derivatives for trading or speculative purposes. Accounting for derivatives as hedges requires that at inception, and over the term of the instruments, the hedged item and derivative qualify for hedge accounting. The rules and interpretations for derivatives are complex. Failure to apply this guidance correctly may result in all changes in fair value of the derivative being recognized in earnings.

We assess both at inception, and at least quarterly thereafter, whether the derivatives used in hedging transactions are effective at offsetting changes in either the fair values or cash flows of the related underlying exposures. Any ineffective portion of a derivative financial instrument’s change in fair value is immediately recognized in earnings. Derivatives not designated as hedges are to manage our exposure to foreign currency fluctuations and variable interest rates but do not meet the strict hedge accounting requirements.

See Note 18 to the Consolidated Financial Statements for additional information about our derivative financial instrument policy.

Income Taxes

As part of the process of preparing our consolidated financial statements, significant management judgment is required to estimate our income tax liability for each taxable entity, the liability associated with open tax years that are under review, our REIT taxable income and our compliance with REIT requirements. Our estimates are based on interpretation of tax laws. We estimate our actual current income tax due and assess temporary differences resulting from differing treatment of items for book and tax purposes resulting in the recognition of deferred income tax assets and liabilities. These estimates may have an impact on the income tax expense recognized. Adjustments may be required by a change in assessment of our deferred income tax assets and liabilities; changes in assessments of the recognition of income tax benefits for certain non-routine transactions; changes due to audit adjustments by federal, international and state tax authorities; our inability to qualify as a REIT; the potential for built-in gain recognition; changes in the assessment of properties to be contributed to taxable REIT subsidiaries and changes in tax laws. Adjustments required in any given period are included within income tax expense. We recognize the tax benefit from an uncertain tax position only if it is “more likely than not” that the tax position will be sustained on examination by taxing authorities.

Impairment of Long-Lived Assets

We assess the carrying values of our respective long-lived assets whenever events or changes in circumstances indicate that the carrying amounts of these assets may not be fully recoverable.

Recoverability of real estate assets is measured by comparison of the carrying amount of the asset to the estimated future undiscounted cash flows. In order to review our real estate assets for recoverability, we consider current market conditions, as well as our intent with respect to holding or disposing of the asset. Our intent with regard to the underlying assets might change as market conditions change. Fair value is determined through various valuation techniques, including discounted cash flow models, applying a capitalization rate to estimated NOI of a property, quoted market values and third-party appraisals, where considered necessary. The use of projected future cash flows is based on assumptions that are consistent with our estimates of future expectations and the strategic plan we use to manage our underlying business. If our analysis indicates that the carrying value of a real estate property that we expect to hold is not recoverable on an undiscounted cash flow basis, we recognize an impairment charge for the amount by which the carrying value exceeds the current estimated fair value of the real estate property. At the time our intent changes to dispose of one of our real estate properties, we compare the carrying value of the property to the estimated proceeds from disposition. If there is an impairment, we record an impairment for any excess, including costs to sell.

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Assumptions and estimates used in the recoverability analyses for future cash flows, discount rates and capitalization rates are complex and subjective. Changes in economic and operating conditions or our intent with regard to our investment that occurs subsequent to our impairment analyses could impact these assumptions and result in future impairment of our long-lived assets.

New Accounting Pronouncements

See Note 2 to the Consolidated Financial Statements.

Funds from Operations (“FFO”)

FFO is a financial measure that is not determined in accordance with U.S. generally accepted accounting principles (“GAAP”), but is a measure that is commonly used in the real estate industry. The most directly comparable GAAP measure to FFO is net earnings. Although the National Association of Real Estate Investment Trusts (“NAREIT”) has published a definition of FFO, modifications to the NAREIT calculation of FFO are common among real estate investment trusts, as companies seek to provide financial measures that meaningfully reflect their business.

FFO is not meant to represent a comprehensive system of financial reporting and does not present, nor do we intend it to present, a complete picture of our financial condition and operating performance. We believe net earnings computed under GAAP remains the primary measure of performance and that FFO is only meaningful when it is used in conjunction with net earnings computed under GAAP. Further, we believe our consolidated financial statements, prepared in accordance with GAAP, provide the most meaningful picture of our financial condition and our operating performance.

NAREIT’s FFO measure adjusts net earnings computed under GAAP to exclude historical cost depreciation and gains and losses from the sales, along with impairment charges, of previously depreciated properties. We agree that these NAREIT adjustments are useful to investors for the following reasons:

(i) | historical cost accounting for real estate assets in accordance with GAAP assumes, through depreciation charges, that the value of real estate assets diminishes predictably over time. NAREIT stated in its White Paper on FFO “since real estate asset values have historically risen or fallen with market conditions, many industry investors have considered presentations of operating results for real estate companies that use historical cost accounting to be insufficient by themselves.” Consequently, NAREIT’s definition of FFO reflects the fact that real estate, as an asset class, generally appreciates over time and depreciation charges required by GAAP do not reflect the underlying economic realities.

(ii) | REITs were created in order to encourage public ownership of real estate as an asset class through investment in firms that were in the business of long-term ownership and management of real estate. The exclusion, in NAREIT’s definition of FFO, of gains and losses from the sales, along with impairment charges, of previously depreciated operating real estate assets allows investors and analysts to readily identify the operating results of the long-term assets that form the core of a REIT’s activity and assists in comparing those operating results between periods. We include the gains and losses (including impairment charges) from dispositions of land and development properties, as well as our proportionate share of the gains and losses (including impairment charges) from dispositions of development properties recognized by our unconsolidated entities, in our definition of FFO. We exclude the gain on revaluation of equity investments upon acquisition of a controlling interest from our definition of FFO.

Our FFO Measures

At the same time that NAREIT created and defined its FFO measure for the REIT industry, it also recognized that “management of each of its member companies has the responsibility and authority to publish financial information that it regards as useful to the financial community.” We believe stockholders, potential investors and financial analysts who review our operating results are best served by a defined FFO measure that includes other adjustments to net earnings computed under GAAP in addition to those included in the NAREIT-defined measure of FFO. Our FFO measures are used by management in analyzing our business and the performance of our properties and we believe that it is important that stockholders, potential investors and financial analysts understand the measures management uses.

We use these FFO measures, including by segment and region, to: (i) evaluate our performance and the performance of our properties in comparison to expected results and results of previous periods, relative to resource allocation decisions; (ii) evaluate the performance of our management; (iii) budget and forecast future results to assist in the allocation of resources; (iv) assess our performance as compared to similar real estate companies and the industry in general; and (v) evaluate how a specific potential investment will impact our future results. Because we make decisions with regard to our performance with a long-term outlook, we believe it is appropriate to remove the effects of short-term items that we do not expect to affect the underlying long-term performance of the properties. The long-term performance of our properties is principally driven by rental income. While not infrequent or unusual, these additional items we exclude in calculating FFO, as defined by Prologis, defined below, are subject to significant fluctuations from period to period that cause both positive and negative short-term effects on our results of operations in inconsistent and unpredictable directions that are not relevant to our long-term outlook.

We use our FFO measures as supplemental financial measures of operating performance. We do not use our FFO measures as, nor should they be considered to be, alternatives to net earnings computed under GAAP, as indicators of our operating performance, as alternatives to cash from operating activities computed under GAAP or as indicators of our ability to fund our cash needs.

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FFO, as defined by Prologis

To arrive at FFO, as defined by Prologis, we adjust the NAREIT-defined FFO measure to exclude:

(i) | deferred income tax benefits and deferred income tax expenses recognized by our subsidiaries;

(ii) | current income tax expense related to acquired tax liabilities that were recorded as deferred tax liabilities in an acquisition, to the extent the expense is offset with a deferred income tax benefit in GAAP earnings that is excluded from our defined FFO measure;

(iii) | unhedged foreign currency exchange gains and losses resulting from debt transactions between us and our foreign consolidated subsidiaries and our foreign unconsolidated entities;

(iv) | foreign currency exchange gains and losses from the remeasurement (based on current foreign currency exchange rates) of certain third-party debt of our foreign consolidated subsidiaries and our foreign unconsolidated entities; and

(v) | mark-to-market adjustments and related amortization of debt discounts associated with derivative financial instruments.

We calculate FFO, as defined by Prologis for our unconsolidated entities on the same basis as we calculate our FFO, as defined by Prologis.

We believe investors are best served if the information that is made available to them allows them to align their analysis and evaluation of our operating results along the same lines that our management uses in planning and executing our business strategy.

Core FFO

In addition to FFO, as defined by Prologis, we also use Core FFO. To arrive at Core FFO, we adjust FFO, as defined by Prologis, to exclude the following recurring and non-recurring items that we recognized directly or our share of these items recognized by our unconsolidated entities to the extent they are included in FFO, as defined by Prologis:

(i) | gains or losses from contribution or sale of land or development properties;

(ii) | income tax expense related to the sale of investments in real estate and third-party acquisition costs related to the acquisition of real estate;

(iii) | impairment charges recognized related to our investments in real estate generally as a result of our change in intent to contribute or sell these properties;

(iv) | gains or losses from the early extinguishment of debt and redemption and repurchase of preferred stock;

(v) | merger, acquisition and other integration expenses; and

(vi) | expenses related to natural disasters.

We believe it is appropriate to further adjust our FFO, as defined by Prologis for certain recurring items as they were driven by transactional activity and factors relating to the financial and real estate markets, rather than factors specific to the on-going operating performance of our properties or investments. The impairment charges we have recognized were primarily based on valuations of real estate, which had declined due to market conditions, that we no longer expected to hold for long-term investment. Over the last few years, we made it a priority to strengthen our financial position by reducing our debt, our investment in certain low yielding assets and our exposure to foreign currency exchange fluctuations. As a result, we changed our intent to sell or contribute certain of our real estate properties and recorded impairment charges when we did not expect to recover the costs of our investment. Also, we purchased portions of our debt securities when we believed it was advantageous to do so, which was based on market conditions, and in an effort to lower our borrowing costs and extend our debt maturities. As a result, we have recognized net gains or losses on the early extinguishment of certain debt due to the financial market conditions at that time.

We have also adjusted for some non-recurring items. The merger, acquisition and other integration expenses included costs we incurred in 2012 associated with the Merger between AMB and ProLogis, the acquisition of ProLogis European Properties and the integration of our systems and processes. In addition, we and our co-investment ventures make acquisitions of real estate and we believe the costs associated with these transactions are transaction based and not part of our core operations.

We analyze our operating performance primarily by the rental income of our real estate and the revenue driven by our strategic capital business, net of operating, administrative and financing expenses. This income stream is not directly impacted by fluctuations in the market value of our investments in real estate or debt securities. Although these items discussed above have had a material impact on our operations and are reflected in our financial statements, the removal of the effects of these items allows us to better understand the core operating performance of our properties over the long term.

We use Core FFO, including by segment and region, to: (i) evaluate our performance and the performance of our properties in comparison to expected results and results of previous periods, relative to resource allocation decisions; (ii) evaluate the performance of our management; (iii) budget and forecast future results to assist in the allocation of resources; (iv) provide guidance to the financial markets to understand our

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expected operating performance; (v) assess our operating performance as compared to similar real estate companies and the industry in general; and (vi) evaluate how a specific potential investment will impact our future results. Because we make decisions with regard to our performance with a long-term outlook, we believe it is appropriate to remove the effects of items that we do not expect to affect the underlying long-term performance of the properties we own. As noted above, we believe the long-term performance of our properties is principally driven by rental income. We believe investors are best served if the information that is made available to them allows them to align their analysis and evaluation of our operating results along the same lines that our management uses in planning and executing our business strategy.

Limitations on Use of our FFO Measures

While we believe our defined FFO measures are important supplemental measures, neither NAREIT’s nor our measures of FFO should be used alone because they exclude significant economic components of net earnings computed under GAAP and are, therefore, limited as an analytical tool. Accordingly, these are only a few of the many measures we use when analyzing our business. Some of these limitations are:

(i) | The current income tax expenses and acquisition costs that are excluded from our defined FFO measures represent the taxes and transaction costs that are payable.

(ii) | Depreciation and amortization of real estate assets are economic costs that are excluded from FFO. FFO is limited, as it does not reflect the cash requirements that may be necessary for future replacements of the real estate assets. Further, the amortization of capital expenditures and leasing costs necessary to maintain the operating performance of industrial properties are not reflected in FFO.

(iii) | Gains or losses from property acquisitions and dispositions or impairment charges related to expected dispositions represent changes in value of the properties. By excluding these gains and losses, FFO does not capture realized changes in the value of acquired or disposed properties arising from changes in market conditions.

(iv) | The deferred income tax benefits and expenses that are excluded from our defined FFO measures result from the creation of a deferred income tax asset or liability that may have to be settled at some future point. Our defined FFO measures do not currently reflect any income or expense that may result from such settlement.

(v) | The foreign currency exchange gains and losses that are excluded from our defined FFO measures are generally recognized based on movements in foreign currency exchange rates through a specific point in time. The ultimate settlement of our foreign currency-denominated net assets is indefinite as to timing and amount. Our FFO measures are limited in that they do not reflect the current period changes in these net assets that result from periodic foreign currency exchange rate movements.

(vi) | The gains and losses on extinguishment of debt that we exclude from our Core FFO, may provide a benefit or cost to us as we may be settling our debt at less or more than our future obligation.

(vii) | The merger, acquisition and other integration expenses and the natural disaster expenses that we exclude from Core FFO are costs that we have incurred.

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We compensate for these limitations by using our FFO measures only in conjunction with net earnings computed under GAAP when making our decisions. This information should be read with our complete consolidated financial statements prepared under GAAP. To assist investors in compensating for these limitations, we reconcile our defined FFO measures to our net earnings computed under GAAP for the years ended December 31 as follows (in thousands).

|  | 2014 |  |  | 2013 |  |  | 2012 |
FFO |  |  |  |  |  |  |  |  |  |  |  |
Reconciliation of net earnings (loss) to FFO measures: |  |  |  |  |  |  |  |  |  |  |  |
Net earnings (loss) attributable to common stockholders |  | $ | 622,235 |  |  | $ | 315,422 |  |  | $ | (80,946) |
Add (deduct) NAREIT–defined adjustments: |  |  |  |  |  |  |  |  |  |  |  |
Real estate related depreciation and amortization |  |  | 617,814 |  |  |  | 624,573 |  |  |  | 705,717 |
Impairment charges on certain real estate properties |  |  | - |  |  |  | - |  |  |  | 34,801 |
Gains on dispositions of non-development properties and revaluation of equity investments upon acquisition of a controlling interest, net |  |  | (553,298) |  |  |  | (271,315) |  |  |  | (207,033) |
Reconciling items related to noncontrolling interests |  |  | 47,939 |  |  |  | (8,993) |  |  |  | (27,680) |
Our share of reconciling items included in earnings from unconsolidated entities |  |  | 186,540 |  |  |  | 159,792 |  |  |  | 127,323 |
Subtotal–NAREIT–defined FFO |  |  | 921,230 |  |  |  | 819,479 |  |  |  | 552,182 |
Add (deduct) our defined adjustments: |  |  |  |  |  |  |  |  |  |  |  |
Unrealized foreign currency and derivative losses (gains) and related amortization, net |  |  | 18,984 |  |  |  | 32,870 |  |  |  | 14,892 |
Deferred income tax expense (benefit) |  |  | (56,720) |  |  |  | 656 |  |  |  | (8,804) |
Our share of reconciling items included in earnings from unconsolidated entities |  |  | 4,015 |  |  |  | 2,168 |  |  |  | (5,835) |
FFO, as defined by Prologis |  |  | 887,509 |  |  |  | 855,173 |  |  |  | 552,435 |
Adjustments to arrive at Core FFO: |  |  |  |  |  |  |  |  |  |  |  |
Net gains on dispositions of development properties and land, net |  |  | (152,798) |  |  |  | (336,815) |  |  |  | (121,303) |
Losses on early extinguishment of debt and redemption / repurchase of preferred stock, net |  |  | 171,817 |  |  |  | 286,122 |  |  |  | 14,114 |
Our share of reconciling items included in earnings from unconsolidated entities less third-party share of consolidated entities |  |  | 46,619 |  |  |  | 8,744 |  |  |  | 23,097 |
Impairment charges |  |  | - |  |  |  | - |  |  |  | 264,844 |
Merger, acquisition and other integration expenses |  |  | - |  |  |  | - |  |  |  | 80,676 |
Core FFO |  | $ | 953,147 |  |  | $ | 813,224 |  |  | $ | 813,863 |

ITEM 7A. Quantitative and Qualitative Disclosures about Market Risk

We are exposed to the impact of interest rate changes and foreign-exchange related variability and earnings volatility on our foreign investments. See our risk factors in Item 1A. Risk Factors, specifically: The depreciation in the value of the foreign currency in countries where we have a significant investment may adversely affect our results of operations and financial position and We face risks associated with the use of debt to fund our business activities, including refinancing and interest rate risks, which may adversely affect our operating results and financial condition if we are unable to make required payments on our debt or are unable to refinance our debt. See also Notes 2 and 18 in the Consolidated Financial Statements in Item 8 for more information about our foreign operations and derivative financial instruments.

We monitor our market risk exposures using a sensitivity analysis. Our sensitivity analysis estimates the exposure to market risk sensitive instruments assuming a hypothetical 10% adverse change in exchange or interest rates at December 31, 2014. The results of the sensitivity analysis are summarized below. The sensitivity analysis is of limited predictive value. As a result, our ultimate realized gains or losses with respect to interest rate and foreign currency exchange rate fluctuations will depend on the exposures that arise during a future period, hedging strategies at the time and the prevailing interest and foreign currency exchange rates.

Foreign Currency Risk

We are exposed to foreign exchange-related variability and earnings volatility on our foreign investments. Foreign currency market risk is the possibility that our financial results or financial position could be better or worse than planned because of changes in foreign currency exchange rates. At December 31, 2014, we had net equity of approximately $1.5 billion, or 11% of total net equity, denominated in a currency other than the U.S. dollar, after consideration of our derivative and non-derivative financial instruments. Based on our sensitivity analysis, a 10% reduction in exchange rates would cause a reduction of $150 million to our net equity.

At December 31, 2014, we had foreign currency forward contracts, which were designated and qualify as net investment hedges, with an aggregate notional amount of $1.1 billion to hedge a portion of our investments in Europe, including the United Kingdom, and Japan. Based on our sensitivity analysis, a weakening of the U.S. dollar against each of the euro, British pound sterling and Japanese yen by 10% would

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result in a $105 million negative change in our cash flows upon settlement. In addition, we also have euro option contracts, which were not designated as hedges, with an aggregate notional amount of $0.4 billion to mitigate risk associated with the translation of projected net income of our subsidiaries in Europe. A weakening of the U.S. dollar against the euro by 10% would result in a $35 million negative change in our cash flows upon settlement.

Interest Rate Risk

We are exposed to the impact of interest rate changes on future earnings and cash flows. At December 31, 2014, we had $572.7 million of variable rate debt outstanding, all of which was on our term loans. At December 31, 2014, we had entered into interest rate swap agreements to fix $342.1 million of our Japanese yen term loan. During the year ended December 31, 2014, we had weighted average daily outstanding borrowings of $181.6 million on our variable rate credit facilities not subject to interest rate swap agreements. Based on the results of a sensitivity analysis assuming a 10% adverse change in interest rates based on our average outstanding balances during the period, the impact was $0.5 million, which equates to a change in interest rates of 13 basis points.

ITEM 8. Financial Statements and Supplementary Data

The Consolidated Balance Sheets at December 31, 2014 and 2013, the Consolidated Statements of Operations, Comprehensive Income (Loss), Equity/Capital and Cash Flows for each of the years in the three-year period ended December 31, 2014, Notes to Consolidated Financial Statements and Schedule III — Real Estate and Accumulated Depreciation, together with the reports of KPMG LLP, independent registered public accounting firm, are included under Item 15 of this report and are incorporated herein by reference. Selected unaudited quarterly financial data is presented in Note 22 of the Consolidated Financial Statements.

ITEM 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

None.

ITEM 9A. Controls and Procedures

Controls and Procedures (Prologis, Inc.)

Prologis, Inc. carried out an evaluation under the supervision and with the participation of management, including the Chief Executive Officer and Chief Financial Officer, of the effectiveness of the disclosure controls and procedures (as defined in Rule 13a-15(e) under the Exchange Act) at December 31, 2014. Based on this evaluation, the Chief Executive Officer and the Chief Financial Officer have concluded that the disclosure controls and procedures are effective to ensure that information required to be disclosed by us in reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC rules and forms. Subsequent to December 31, 2014, there were no significant changes in the internal controls or in other factors that could significantly affect these controls, including any corrective actions with regard to significant deficiencies and material weaknesses.

Changes in Internal Control over Financial Reporting

There has been no change in our internal control over financial reporting (as such term is defined in Rules 13a-15(f) and 15(d)-15(f) under the Exchange Act) that occurred during the quarter ended December 31, 2014, that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

Management’s Annual Report on Internal Control over Financial Reporting

We are responsible for establishing and maintaining adequate internal control over financial reporting as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act.

Under the supervision and with the participation of management, including the Chief Executive Officer and Chief Financial Officer, an evaluation of the effectiveness of the internal control over financial reporting was conducted at December 31, 2014, based on the criteria described in “Internal Control — Integrated Framework” (1992) issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based on this assessment, management determined that, at December 31, 2014, the internal control over financial reporting was effective.

Our internal control over financial reporting at December 31, 2014, has been audited by KPMG LLP, an independent registered public accounting firm, as stated in their attestation report which is included herein.

Limitations of the Effectiveness of Controls

Management’s assessment included an evaluation of the design of the internal control over financial reporting and testing of the operational effectiveness of the internal control over financial reporting. The internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with GAAP. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

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Controls and Procedures (Prologis, L.P.)

Prologis, L.P. carried out an evaluation under the supervision and with the participation of management, including the Chief Executive Officer and Chief Financial Officer, of the effectiveness of the disclosure controls and procedures (as defined in Rule 13a-15(e) under the Exchange Act) at December 31, 2014. Based on this evaluation, the Chief Executive Officer and the Chief Financial Officer have concluded that the disclosure controls and procedures are effective to ensure that information required to be disclosed by us in reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC rules and forms. Subsequent to December 31, 2014, there were no significant changes in the internal controls or in other factors that could significantly affect these controls, including any corrective actions with regard to significant deficiencies and material weaknesses.

Changes in Internal Control over Financial Reporting

There has been no change in our internal control over financial reporting (as such term is defined in Rules 13a-15(f) and 15(d)-15(f) under the Exchange Act) that occurred during the quarter ended December 31, 2014, that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

Management’s Annual Report on Internal Control over Financial Reporting

We are responsible for establishing and maintaining adequate internal control over financial reporting as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act.

Under the supervision and with the participation of management, including the Chief Executive Officer and Chief Financial Officer, an evaluation of the effectiveness of the internal control over financial reporting was conducted at December 31, 2014, based on the criteria described in “Internal Control — Integrated Framework” (1992) issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based on this assessment, management determined that, at December 31, 2014, the internal control over financial reporting was effective.

Limitations of the Effectiveness of Controls

Management’s assessment included an evaluation of the design of the internal control over financial reporting and testing of the operational effectiveness of the internal control over financial reporting. The internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with GAAP. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

ITEM 9B. Other Information

None.

PART III

ITEM 10. Directors, Executive Officers and Corporate Governance

Directors and Officers

The information required by this item is incorporated herein by reference to the descriptions under the captions “Election of Directors — Nominees,” Information Relating to Stockholders, Directors, Nominees and Executive Officers — Certain Information with Respect to Executive Officers, “Additional Information — Section 16(a) Beneficial Ownership Reporting Compliance,” “Corporate Governance” and “Board of Directors” in our 2015 Proxy Statement or will be provided in an amendment filed on Form 10-K/A.

ITEM 11. Executive Compensation

The information required by this item is incorporated herein by reference to the descriptions under the captions “Executive Compensation Matters” and “Board of Directors and Committees” in our 2015 Proxy Statement or will be provided in an amendment filed on Form 10-K/A.

ITEM 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

The information required by this item is incorporated herein by reference to the descriptions under the captions “Information Relating to Stockholders, Directors, Nominees, and Executive Officers — Security Ownership” and “Equity Compensation Plans” in our 2015 Proxy Statement or will be provided in an amendment filed on Form 10-K/A.

ITEM 13. Certain Relationships and Related Transactions, and Director Independence

The information required by this item is incorporated herein by reference to the descriptions under the captions “Information Relating to Stockholders, Directors, Nominees and Executive Officers — Certain Relationships and Related Transactions” and “Corporate Governance” in our 2015 Proxy Statement or will be provided in an amendment filed on Form 10-K/A.

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ITEM 14. Principal Accounting Fees and Services

The information required by this item is incorporated herein by reference to the description under the caption “Independent Registered Public Accounting Firm” in our 2015 Proxy Statement or will be provided in an amendment filed on Form 10-K/A.

PART IV

ITEM 15. Exhibits, Financial Statement Schedules

The following documents are filed as a part of this report:

(a) Financial Statements and Schedules:

1. Financial Statements:

See Index to Consolidated Financial Statements and Schedule III on page 44 of this report, which is incorporated herein by reference.

2. Financial Statement Schedules:

Schedule III — Real Estate and Accumulated Depreciation

All other schedules have been omitted since the required information is presented in the Consolidated Financial Statements and the related Notes or is not applicable.

(b) Exhibits: The Exhibits required by Item 601 of Regulation S-K are listed in the Index to Exhibits on pages 115 to 120 of this report, which is incorporated herein by reference.

(c) Financial Statements: See Index to Consolidated Financial Statements and Schedule III on page 44 of this report, which is incorporated by reference.

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INDEX TO CONSOLIDATED FINANCIAL STATEMENTS AND SCHEDULE III

|  | Page |
Prologis, Inc. and Prologis L.P.: |  |  |  |
Reports of Independent Registered Public Accounting Firm |  |  | 45 |
Prologis, Inc.: |  |  |  |
Consolidated Balance Sheets |  |  | 48 |
Consolidated Statements of Operations |  |  | 49 |
Consolidated Statements of Comprehensive Income (Loss) |  |  | 50 |
Consolidated Statements of Equity |  |  | 51 |
Consolidated Statements of Cash Flows |  |  | 52 |
Prologis, L.P.: |  |  |  |
Consolidated Balance Sheets |  |  | 53 |
Consolidated Statements of Operations |  |  | 54 |
Consolidated Statements of Comprehensive Income (Loss) |  |  | 55 |
Consolidated Statements of Capital |  |  | 56 |
Consolidated Statements of Cash Flows |  |  | 57 |
Prologis, Inc. and Prologis L.P.: |  |  |  |
Notes to Consolidated Financial Statements |  |  | 58 |
Reports of Independent Registered Public Accounting Firm |  |  | 97 |
Schedule III — Real Estate and Accumulated Depreciation |  |  | 99 |

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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

The Board of Directors and Stockholders

Prologis, Inc.:

We have audited the accompanying consolidated balance sheets of Prologis, Inc. and subsidiaries (the “Company”) as of December 31, 2014 and 2013, and the related consolidated statements of operations, comprehensive income (loss), equity, and cash flows for each of the years in the three-year period ended December 31, 2014. These consolidated financial statements are the responsibility of Prologis, Inc.’s management. Our responsibility is to express an opinion on these consolidated financial statements based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of Prologis, Inc. and subsidiaries as of December 31, 2014 and 2013, and the results of their operations and their cash flows for each of the years in the three-year period ended December 31, 2014, in conformity with U.S. generally accepted accounting principles.

As discussed in Note 2 to the consolidated financial statements, the Company has changed its method of accounting for discontinued operations as of January 1, 2014, on a prospective basis, due to the adoption of Accounting Standards Update 2014-08.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), Prologis, Inc.’s internal control over financial reporting as of December 31, 2014, based on criteria established in Internal Control — Integrated Framework (1992) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO), and our report dated February 25, 2015 expressed an unqualified opinion on the effectiveness of Prologis, Inc.’s internal control over financial reporting.

KPMG LLP

Denver, Colorado

February 25, 2015

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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

The Partners

Prologis, L.P.:

We have audited the accompanying consolidated balance sheets of Prologis, L.P. and subsidiaries (the “Company”) as of December 31, 2014 and 2013, and the related consolidated statements of operations, comprehensive income (loss), capital, and cash flows for each of the years in the three-year period ended December 31, 2014. These consolidated financial statements are the responsibility of Prologis, L.P.’s management. Our responsibility is to express an opinion on these consolidated financial statements based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

As discussed in Note 2 to the consolidated financial statements, the Company has changed its method of accounting for discontinued operations as of January 1, 2014, on a prospective basis, due to the adoption of Accounting Standards Update 2014-08.

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of Prologis, L.P. and subsidiaries as of December 31, 2014 and 2013, and the results of their operations and their cash flows for each of the years in the three-year period ended December 31, 2014, in conformity with U.S. generally accepted accounting principles.

KPMG LLP

Denver, Colorado

February 25, 2015

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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

The Board of Directors and Stockholders

Prologis, Inc.:

We have audited Prologis, Inc.’s internal control over financial reporting as of December 31, 2014, based on criteria established in Internal Control — Integrated Framework (1992) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Prologis, Inc.’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management’s Annual Report on Internal Control over Financial Reporting. Our responsibility is to express an opinion on Prologis, Inc.’s internal control over financial reporting based on our audit.

We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audit also included performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.

A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

In our opinion, Prologis, Inc. maintained, in all material respects, effective internal control over financial reporting as of December 31, 2014, based on criteria established in Internal Control — Integrated Framework (1992) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the consolidated balance sheets of Prologis, Inc. and subsidiaries as of December 31, 2014 and 2013, and the related consolidated statements of operations, comprehensive income (loss), equity, and cash flows for each of the years in the three-year period ended December 31, 2014, and our report dated February 25, 2015 expressed an unqualified opinion on those consolidated financial statements.

KPMG LLP

Denver, Colorado

February 25, 2015

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PROLOGIS, INC.

CONSOLIDATED BALANCE SHEETS

(In thousands, except per share data)

|  | December 31, |
|  | 2014 |  |  | 2013 |
ASSETS |
Investments in real estate properties |  | $ | 22,190,145 |  |  | $ | 20,824,477 |
Less accumulated depreciation |  |  | 2,790,781 |  |  |  | 2,568,998 |
Net investments in real estate properties |  |  | 19,399,364 |  |  |  | 18,255,479 |
Investments in and advances to unconsolidated entities |  |  | 4,824,724 |  |  |  | 4,430,239 |
Assets held for sale |  |  | 43,934 |  |  |  | 4,042 |
Notes receivable backed by real estate |  |  | - |  |  |  | 188,000 |
Net investments in real estate |  |  | 24,268,022 |  |  |  | 22,877,760 |
Cash and cash equivalents |  |  | 350,692 |  |  |  | 491,129 |
Accounts receivable |  |  | 103,445 |  |  |  | 107,955 |
Other assets |  |  | 1,096,064 |  |  |  | 1,095,463 |
Total assets |  | $ | 25,818,223 |  |  | $ | 24,572,307 |
LIABILITIES AND EQUITY |  |  |  |  |  |  |  |
Liabilities: |  |  |  |  |  |  |  |
Debt |  | $ | 9,380,199 |  |  | $ | 9,011,216 |
Accounts payable and accrued expenses |  |  | 627,999 |  |  |  | 563,993 |
Other liabilities |  |  | 626,426 |  |  |  | 820,645 |
Total liabilities |  |  | 10,634,624 |  |  |  | 10,395,854 |
Equity: |  |  |  |  |  |  |  |
Prologis, Inc. stockholders’ equity: |  |  |  |  |  |  |  |
Series Q preferred stock at stated liquidation preference of $50 per share; $0.01 par value; 100,000 shares authorized; 1,565 shares and 2,000 shares issued and outstanding at December 31, 2014 and December 31, 2013, respectively |  |  | 78,235 |  |  |  | 100,000 |
Common stock; $0.01 par value; 509,498 shares and 498,799 shares issued and outstanding at December 31, 2014 and December 31, 2013, respectively |  |  | 5,095 |  |  |  | 4,988 |
Additional paid-in capital |  |  | 18,467,009 |  |  |  | 17,974,509 |
Accumulated other comprehensive loss |  |  | (600,337) |  |  |  | (435,675) |
Distributions in excess of net earnings |  |  | (3,974,493) |  |  |  | (3,932,664) |
Total Prologis, Inc. stockholders’ equity |  |  | 13,975,509 |  |  |  | 13,711,158 |
Noncontrolling interests |  |  | 1,208,090 |  |  |  | 465,295 |
Total equity |  |  | 15,183,599 |  |  |  | 14,176,453 |
Total liabilities and equity |  | $ | 25,818,223 |  |  | $ | 24,572,307 |

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

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PROLOGIS, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

Years Ended December 31, 2014, 2013, 2012

(In thousands, except per share amounts)

|  | 2014 |  |  | 2013 |  |  | 2012 |
Revenues: |  |  |  |  |  |  |  |  |  |  |  |
Rental income |  | $ | 1,178,609 |  |  | $ | 1,227,975 |  |  | $ | 1,459,461 |
Rental recoveries |  |  | 348,740 |  |  |  | 331,518 |  |  |  | 364,320 |
Strategic capital income |  |  | 219,871 |  |  |  | 179,472 |  |  |  | 126,779 |
Development management and other income |  |  | 13,567 |  |  |  | 11,521 |  |  |  | 9,958 |
Total revenues |  |  | 1,760,787 |  |  |  | 1,750,486 |  |  |  | 1,960,518 |
Expenses: |  |  |  |  |  |  |  |  |  |  |  |
Rental expenses |  |  | 430,787 |  |  |  | 451,938 |  |  |  | 491,239 |
Strategic capital expenses |  |  | 96,496 |  |  |  | 89,279 |  |  |  | 63,820 |
General and administrative expenses |  |  | 247,768 |  |  |  | 229,207 |  |  |  | 228,068 |
Depreciation and amortization |  |  | 642,461 |  |  |  | 648,668 |  |  |  | 724,262 |
Other expenses |  |  | 23,467 |  |  |  | 26,982 |  |  |  | 26,556 |
Merger, acquisition and other integration expenses |  |  | - |  |  |  | - |  |  |  | 80,676 |
Impairment of real estate properties |  |  | - |  |  |  | - |  |  |  | 252,914 |
Total expenses |  |  | 1,440,979 |  |  |  | 1,446,074 |  |  |  | 1,867,535 |
Operating income |  |  | 319,808 |  |  |  | 304,412 |  |  |  | 92,983 |
Other income (expense): |  |  |  |  |  |  |  |  |  |  |  |
Earnings from unconsolidated entities, net |  |  | 134,288 |  |  |  | 97,220 |  |  |  | 31,676 |
Interest expense |  |  | (308,885) |  |  |  | (379,327) |  |  |  | (505,215) |
Interest and other income, net |  |  | 25,768 |  |  |  | 26,948 |  |  |  | 22,878 |
Gains on dispositions of investments in real estate and revaluation of equity investments upon acquisition of a controlling interest, net |  |  | 725,790 |  |  |  | 597,656 |  |  |  | 305,607 |
Foreign currency and derivative losses and related amortization, net |  |  | (17,841) |  |  |  | (33,633) |  |  |  | (20,497) |
Losses on early extinguishment of debt, net |  |  | (165,300) |  |  |  | (277,014) |  |  |  | (14,114) |
Impairment of other assets |  |  | - |  |  |  | - |  |  |  | (16,135) |
Total other income (expense) |  |  | 393,820 |  |  |  | 31,850 |  |  |  | (195,800) |
Earnings (loss) before income taxes |  |  | 713,628 |  |  |  | 336,262 |  |  |  | (102,817) |
Current income tax expense |  |  | (61,584) |  |  |  | (126,180) |  |  |  | (17,870) |
Deferred income tax benefit |  |  | 87,240 |  |  |  | 19,447 |  |  |  | 14,290 |
Total income tax benefit (expense) |  |  | 25,656 |  |  |  | (106,733) |  |  |  | (3,580) |
Earnings (loss) from continuing operations |  |  | 739,284 |  |  |  | 229,529 |  |  |  | (106,397) |
Discontinued operations: |  |  |  |  |  |  |  |  |  |  |  |
Income attributable to disposed properties and assets held for sale |  |  | - |  |  |  | 6,970 |  |  |  | 40,827 |
Net gains on dispositions, including related impairment charges and taxes |  |  | - |  |  |  | 116,550 |  |  |  | 35,098 |
Total discontinued operations |  |  | - |  |  |  | 123,520 |  |  |  | 75,925 |
Consolidated net earnings (loss) |  |  | 739,284 |  |  |  | 353,049 |  |  |  | (30,472) |
Net earnings attributable to noncontrolling interests |  |  | (103,101) |  |  |  | (10,128) |  |  |  | (9,248) |
Net earnings (loss) attributable to controlling interests |  |  | 636,183 |  |  |  | 342,921 |  |  |  | (39,720) |
Less preferred stock dividends |  |  | 7,431 |  |  |  | 18,391 |  |  |  | 41,226 |
Loss on preferred stock redemption / repurchase |  |  | 6,517 |  |  |  | 9,108 |  |  |  | - |
Net earnings (loss) attributable to common stockholders |  | $ | 622,235 |  |  | $ | 315,422 |  |  | $ | (80,946) |
Weighted average common shares outstanding - Basic |  |  | 499,583 |  |  |  | 486,076 |  |  |  | 459,895 |
Weighted average common shares outstanding - Diluted |  |  | 506,391 |  |  |  | 491,546 |  |  |  | 461,848 |
Net earnings (loss) per share attributable to common stockholders - Basic: |  |  |  |  |  |  |  |  |  |  |  |
Continuing operations |  | $ | 1.25 |  |  | $ | 0.40 |  |  | $ | (0.35) |
Discontinued operations |  |  | - |  |  |  | 0.25 |  |  |  | 0.17 |
Net earnings (loss) per share attributable to common stockholders - Basic |  | $ | 1.25 |  |  | $ | 0.65 |  |  | $ | (0.18) |
Net earnings (loss) per share attributable to common stockholders - Diluted: |  |  |  |  |  |  |  |  |  |  |  |
Continuing operations |  | $ | 1.24 |  |  | $ | 0.39 |  |  | $ | (0.34) |
Discontinued operations |  |  | - |  |  |  | 0.25 |  |  |  | 0.16 |
Net earnings (loss) per share attributable to common stockholders - Diluted |  | $ | 1.24 |  |  | $ | 0.64 |  |  | $ | (0.18) |
Dividends per common share |  | $ | 1.32 |  |  | $ | 1.12 |  |  | $ | 1.12 |

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

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PROLOGIS, INC.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

Years Ended December 31, 2014, 2013 and 2012

(In thousands)

|  | 2014 |  |  | 2013 |  |  | 2012 |
Consolidated net earnings (loss) |  | $ | 739,284 |  |  | $ | 353,049 |  |  | $ | (30,472) |
Other comprehensive income (loss): |  |  |  |  |  |  |  |  |  |  |  |
Foreign currency translation losses, net |  |  | (171,401) |  |  |  | (234,680) |  |  |  | (79,014) |
Unrealized gains (losses) and amortization on derivative contracts, net |  |  | (6,498) |  |  |  | 19,590 |  |  |  | 17,986 |
Comprehensive income (loss) |  |  | 561,385 |  |  |  | 137,959 |  |  |  | (91,500) |
Net earnings attributable to noncontrolling interests |  |  | (103,101) |  |  |  | (10,128) |  |  |  | (9,248) |
Other comprehensive loss attributable to noncontrolling interest |  |  | 13,237 |  |  |  | 12,978 |  |  |  | 9,786 |
Comprehensive income (loss) attributable to common stockholders |  | $ | 471,521 |  |  | $ | 140,809 |  |  | $ | (90,962) |

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

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PROLOGIS, INC.

CONSOLIDATED STATEMENTS OF EQUITY

Years Ended December 31, 2014, 2013 and 2012

(In thousands)

|  | Preferred Stock |  |  | Common Stock |  |  | Additional Paid-in Capital |  |  | Accumulated Other Comprehensive Income (Loss) |  |  | Distributions in Excess of Net Earnings |  |  | Non- controlling Interests |  |  | Total Equity |
|  | Number of Shares |  |  | Par Value |  |  |  |  |  |
Balance at January 1, 2012 |  | $ | 582,200 |  |  |  | 459,401 |  |  | $ | 4,594 |  |  | $ | 16,349,328 |  |  | $ | (182,321) |  |  | $ | (3,092,162) |  |  | $ | 793,835 |  |  | $ | 14,455,474 |
Consolidated net earnings (loss) |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | (39,720) |  |  |  | 9,248 |  |  |  | (30,472) |
Adjustment to the Merger purchase price allocation |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 10,163 |  |  |  | 10,163 |
Effect of equity compensation plans |  |  | - |  |  |  | 2,258 |  |  |  | 23 |  |  |  | 72,909 |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 72,932 |
Noncontrolling interests, issuances (conversions), net |  |  | - |  |  |  | 111 |  |  |  | 1 |  |  |  | 2,380 |  |  |  | - |  |  |  | - |  |  |  | (2,381) |  |  |  | - |
Capital contributions, net |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 74,447 |  |  |  | 74,447 |
Purchase of noncontrolling interests |  |  | - |  |  |  | - |  |  |  | - |  |  |  | (13,998) |  |  |  | - |  |  |  | - |  |  |  | (128,066) |  |  |  | (142,064) |
Foreign currency translation losses, net |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | (69,155) |  |  |  | - |  |  |  | (9,859) |  |  |  | (79,014) |
Unrealized gains and amortization on derivative contracts, net |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 17,913 |  |  |  | - |  |  |  | 73 |  |  |  | 17,986 |
Distributions and allocations |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 1,236 |  |  |  | - |  |  |  | (564,211) |  |  |  | (43,141) |  |  |  | (606,116) |
Balance at December 31, 2012 |  | $ | 582,200 |  |  |  | 461,770 |  |  | $ | 4,618 |  |  | $ | 16,411,855 |  |  | $ | (233,563) |  |  | $ | (3,696,093) |  |  | $ | 704,319 |  |  | $ | 13,773,336 |
Consolidated net earnings |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 342,921 |  |  |  | 10,128 |  |  |  | 353,049 |
Effect of equity compensation plans |  |  | - |  |  |  | 1,351 |  |  |  | 13 |  |  |  | 93,692 |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 93,705 |
Issuance of stock in equity offering, net of issuance costs |  |  | - |  |  |  | 35,650 |  |  |  | 357 |  |  |  | 1,437,340 |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 1,437,697 |
Redemption of preferred stock |  |  | (482,200) |  |  |  | - |  |  |  | - |  |  |  | 8,593 |  |  |  | - |  |  |  | (9,108) |  |  |  | - |  |  |  | (482,715) |
Issuance of warrant |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 32,359 |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 32,359 |
Capital contributions |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 146,130 |  |  |  | 146,130 |
Settlement of noncontrolling interests |  |  | - |  |  |  | 28 |  |  |  | - |  |  |  | (7,868) |  |  |  | - |  |  |  | - |  |  |  | (247,683) |  |  |  | (255,551) |
Foreign currency translation losses, net |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | (221,633) |  |  |  | - |  |  |  | (13,047) |  |  |  | (234,680) |
Unrealized gains and amortization on derivative contracts, net |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 19,521 |  |  |  | - |  |  |  | 69 |  |  |  | 19,590 |
Distributions and allocations |  |  | - |  |  |  | - |  |  |  | - |  |  |  | (1,462) |  |  |  | - |  |  |  | (570,384) |  |  |  | (134,621) |  |  |  | (706,467) |
Balance at December 31, 2013 |  | $ | 100,000 |  |  |  | 498,799 |  |  | $ | 4,988 |  |  | $ | 17,974,509 |  |  | $ | (435,675) |  |  | $ | (3,932,664) |  |  | $ | 465,295 |  |  | $ | 14,176,453 |
Consolidated net earnings |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 636,183 |  |  |  | 103,101 |  |  |  | 739,284 |
Effect of equity compensation plans |  |  | - |  |  |  | 1,383 |  |  |  | 14 |  |  |  | 88,424 |  |  |  | - |  |  |  | - |  |  |  | 450 |  |  |  | 88,888 |
Issuance of stock in at-the-market program, net of issuance costs |  |  | - |  |  |  | 3,316 |  |  |  | 33 |  |  |  | 140,102 |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 140,135 |
Repurchase of preferred stock |  |  | (21,765) |  |  |  | - |  |  |  | - |  |  |  | 639 |  |  |  | - |  |  |  | (6,517) |  |  |  | - |  |  |  | (27,643) |
Issuance of stock from exercise of warrant |  |  | - |  |  |  | 6,000 |  |  |  | 60 |  |  |  | 213,780 |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 213,840 |
Formation of Prologis U.S. Logistics Venture |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 13,721 |  |  |  | - |  |  |  | - |  |  |  | 442,251 |  |  |  | 455,972 |
Consolidation of Prologis North American Industrial Fund |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 12,507 |  |  |  | - |  |  |  | 554,493 |  |  |  | 567,000 |
Capital contributions |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 14,464 |  |  |  | 14,464 |
Settlement of noncontrolling interests |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 33,803 |  |  |  | - |  |  |  | - |  |  |  | (36,243) |  |  |  | (2,440) |
Foreign currency translation losses, net |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | (167,950) |  |  |  | - |  |  |  | (13,214) |  |  |  | (181,164) |
Unrealized losses and amortization on derivative contracts, net |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | (9,219) |  |  |  | - |  |  |  | (23) |  |  |  | (9,242) |
Distributions and allocations |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 2,031 |  |  |  | - |  |  |  | (671,495) |  |  |  | (322,484) |  |  |  | (991,948) |
Balance at December 31, 2014 |  | $ | 78,235 |  |  |  | 509,498 |  |  | $ | 5,095 |  |  | $ | 18,467,009 |  |  | $ | (600,337) |  |  | $ | (3,974,493) |  |  | $ | 1,208,090 |  |  | $ | 15,183,599 |

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

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PROLOGIS, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

Years Ended December 31, 2014, 2013 and 2012

(In thousands)

|  | 2014 |  |  | 2013 |  |  | 2012 |
Operating activities: |  |  |  |  |  |  |  |  |  |  |  |
Consolidated net earnings (loss) |  | $ | 739,284 |  |  | $ | 353,049 |  |  | $ | (30,472) |
Adjustments to reconcile net earnings (loss) to net cash provided by operating activities: |  |  |  |  |  |  |  |  |  |  |  |
Straight-lined rents |  |  | (42,829) |  |  |  | (46,861) |  |  |  | (62,290) |
Equity-based compensation awards |  |  | 57,478 |  |  |  | 49,239 |  |  |  | 32,138 |
Depreciation and amortization |  |  | 642,461 |  |  |  | 664,007 |  |  |  | 767,459 |
Earnings from unconsolidated entities, net |  |  | (134,288) |  |  |  | (97,220) |  |  |  | (31,676) |
Distributions and net changes in operating receivables from unconsolidated entities |  |  | 110,435 |  |  |  | 75,859 |  |  |  | 6,581 |
Amortization of debt and lease intangibles |  |  | 21,113 |  |  |  | 10,140 |  |  |  | 21,008 |
Non-cash merger, acquisition and other integration expenses |  |  | - |  |  |  | - |  |  |  | 17,581 |
Impairment of real estate properties and other assets |  |  | - |  |  |  | - |  |  |  | 269,049 |
Gains on dispositions of investments in real estate and revaluation of equity investments upon acquisition of a controlling interest, net |  |  | (725,790) |  |  |  | (715,758) |  |  |  | (348,615) |
Losses on early extinguishment of debt, net |  |  | 165,300 |  |  |  | 277,014 |  |  |  | 14,114 |
Unrealized foreign currency and derivative losses and related amortization, net |  |  | 22,571 |  |  |  | 28,619 |  |  |  | 14,892 |
Deferred income tax benefit |  |  | (87,240) |  |  |  | (20,067) |  |  |  | (21,967) |
Increase in accounts receivable and other assets |  |  | (93) |  |  |  | (12,912) |  |  |  | (178,387) |
Decrease in accounts payable and accrued expenses and other liabilities |  |  | (63,871) |  |  |  | (80,120) |  |  |  | (5,923) |
Net cash provided by operating activities |  |  | 704,531 |  |  |  | 484,989 |  |  |  | 463,492 |
Investing activities: |  |  |  |  |  |  |  |  |  |  |  |
Real estate development activity |  |  | (1,051,181) |  |  |  | (845,234) |  |  |  | (793,349) |
Real estate acquisitions |  |  | (612,330) |  |  |  | (514,611) |  |  |  | (254,414) |
Tenant improvements and lease commissions on previously leased space |  |  | (133,957) |  |  |  | (145,424) |  |  |  | (133,558) |
Non-development capital expenditures |  |  | (78,610) |  |  |  | (82,610) |  |  |  | (80,612) |
Investments in and advances to unconsolidated entities |  |  | (739,635) |  |  |  | (1,221,155) |  |  |  | (165,011) |
Return of investment from unconsolidated entities |  |  | 244,306 |  |  |  | 411,853 |  |  |  | 291,679 |
Proceeds from dispositions and contributions of real estate properties |  |  | 2,285,488 |  |  |  | 5,409,745 |  |  |  | 1,975,036 |
Acquisition of a controlling interest in unconsolidated co-investment ventures, net of cash received |  |  | (590,390) |  |  |  | (678,642) |  |  |  | (365,156) |
Proceeds from repayment of notes receivable backed by real estate |  |  | 188,000 |  |  |  | - |  |  |  | 55,000 |
Net cash provided by (used in) investing activities |  |  | (488,309) |  |  |  | 2,333,922 |  |  |  | 529,615 |
Financing activities: |  |  |  |  |  |  |  |  |  |  |  |
Proceeds from issuance of common stock |  |  | 378,247 |  |  |  | 1,505,791 |  |  |  | 30,981 |
Dividends paid on common and preferred stock |  |  | (672,190) |  |  |  | (573,854) |  |  |  | (567,834) |
Redemption of preferred stock |  |  | (27,643) |  |  |  | (482,500) |  |  |  | - |
Noncontrolling interest contributions |  |  | 468,280 |  |  |  | 145,522 |  |  |  | 70,820 |
Noncontrolling interest distributions |  |  | (315,426) |  |  |  | (115,999) |  |  |  | (44,070) |
Purchase of noncontrolling interest |  |  | (2,440) |  |  |  | (250,740) |  |  |  | (142,064) |
Debt and equity issuance costs paid |  |  | (23,420) |  |  |  | (77,017) |  |  |  | (10,963) |
Net proceeds from (payments on) credit facilities |  |  | (717,369) |  |  |  | (93,075) |  |  |  | 9,064 |
Repurchase and payment of debt |  |  | (4,205,806) |  |  |  | (6,012,433) |  |  |  | (1,850,699) |
Proceeds from the issuance of debt |  |  | 4,779,950 |  |  |  | 3,588,683 |  |  |  | 1,433,254 |
Net cash used in financing activities |  |  | (337,817) |  |  |  | (2,365,622) |  |  |  | (1,071,511) |
Effect of foreign currency exchange rate changes on cash |  |  | (18,842) |  |  |  | (62,970) |  |  |  | 3,142 |
Net increase (decrease) in cash and cash equivalents |  |  | (140,437) |  |  |  | 390,319 |  |  |  | (75,262) |
Cash and cash equivalents, beginning of year |  |  | 491,129 |  |  |  | 100,810 |  |  |  | 176,072 |
Cash and cash equivalents, end of year |  | $ | 350,692 |  |  | $ | 491,129 |  |  | $ | 100,810 |

See Note 21 for information on non-cash investing and financing activities and other information.

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

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PROLOGIS, L.P.

CONSOLIDATED BALANCE SHEETS

(In thousands)

|  | December 31, |
|  | 2014 |  |  | 2013 |
ASSETS |
Investments in real estate properties |  | $ | 22,190,145 |  |  | $ | 20,824,477 |
Less accumulated depreciation |  |  | 2,790,781 |  |  |  | 2,568,998 |
Net investments in real estate properties |  |  | 19,399,364 |  |  |  | 18,255,479 |
Investments in and advances to unconsolidated entities |  |  | 4,824,724 |  |  |  | 4,430,239 |
Assets held for sale |  |  | 43,934 |  |  |  | 4,042 |
Notes receivable backed by real estate |  |  | - |  |  |  | 188,000 |
Net investments in real estate |  |  | 24,268,022 |  |  |  | 22,877,760 |
Cash and cash equivalents |  |  | 350,692 |  |  |  | 491,129 |
Accounts receivable |  |  | 103,445 |  |  |  | 107,955 |
Other assets |  |  | 1,096,064 |  |  |  | 1,095,463 |
Total assets |  | $ | 25,818,223 |  |  | $ | 24,572,307 |
LIABILITIES AND CAPITAL |  |  |  |  |  |  |  |
Liabilities: |  |  |  |  |  |  |  |
Debt |  | $ | 9,380,199 |  |  | $ | 9,011,216 |
Accounts payable and accrued expenses |  |  | 627,999 |  |  |  | 563,993 |
Other liabilities |  |  | 626,426 |  |  |  | 820,645 |
Total liabilities |  |  | 10,634,624 |  |  |  | 10,395,854 |
Capital: |  |  |  |  |  |  |  |
Partners’ capital: |  |  |  |  |  |  |  |
General partner - preferred |  |  | 78,235 |  |  |  | 100,000 |
General partner - common |  |  | 13,897,274 |  |  |  | 13,611,158 |
Limited partners |  |  | 48,189 |  |  |  | 48,209 |
Total partners’ capital |  |  | 14,023,698 |  |  |  | 13,759,367 |
Noncontrolling interests |  |  | 1,159,901 |  |  |  | 417,086 |
Total capital |  |  | 15,183,599 |  |  |  | 14,176,453 |
Total liabilities and capital |  | $ | 25,818,223 |  |  | $ | 24,572,307 |

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

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PROLOGIS, L.P.

CONSOLIDATED STATEMENTS OF OPERATIONS

Years Ended December 31, 2014, 2013, 2012

(In thousands, except per unit amounts)

|  | 2014 |  |  | 2013 |  |  | 2012 |
Revenues: |  |  |  |  |  |  |  |  |  |  |  |
Rental income |  | $ | 1,178,609 |  |  | $ | 1,227,975 |  |  | $ | 1,459,461 |
Rental recoveries |  |  | 348,740 |  |  |  | 331,518 |  |  |  | 364,320 |
Strategic capital income |  |  | 219,871 |  |  |  | 179,472 |  |  |  | 126,779 |
Development management and other income |  |  | 13,567 |  |  |  | 11,521 |  |  |  | 9,958 |
Total revenues |  |  | 1,760,787 |  |  |  | 1,750,486 |  |  |  | 1,960,518 |
Expenses: |  |  |  |  |  |  |  |  |  |  |  |
Rental expenses |  |  | 430,787 |  |  |  | 451,938 |  |  |  | 491,239 |
Strategic capital expenses |  |  | 96,496 |  |  |  | 89,279 |  |  |  | 63,820 |
General and administrative expenses |  |  | 247,768 |  |  |  | 229,207 |  |  |  | 228,068 |
Depreciation and amortization |  |  | 642,461 |  |  |  | 648,668 |  |  |  | 724,262 |
Other expenses |  |  | 23,467 |  |  |  | 26,982 |  |  |  | 26,556 |
Merger, acquisition and other integration expenses |  |  | - |  |  |  | - |  |  |  | 80,676 |
Impairment of real estate properties |  |  | - |  |  |  | - |  |  |  | 252,914 |
Total expenses |  |  | 1,440,979 |  |  |  | 1,446,074 |  |  |  | 1,867,535 |
Operating income |  |  | 319,808 |  |  |  | 304,412 |  |  |  | 92,983 |
Other income (expense): |  |  |  |  |  |  |  |  |  |  |  |
Earnings from unconsolidated entities, net |  |  | 134,288 |  |  |  | 97,220 |  |  |  | 31,676 |
Interest expense |  |  | (308,885) |  |  |  | (379,327) |  |  |  | (505,215) |
Interest and other income, net |  |  | 25,768 |  |  |  | 26,948 |  |  |  | 22,878 |
Gains on dispositions of investments in real estate and revaluation of equity investments upon acquisition of a controlling interest, net |  |  | 725,790 |  |  |  | 597,656 |  |  |  | 305,607 |
Foreign currency and derivative losses and related amortization, net |  |  | (17,841) |  |  |  | (33,633) |  |  |  | (20,497) |
Losses on early extinguishment of debt, net |  |  | (165,300) |  |  |  | (277,014) |  |  |  | (14,114) |
Impairment of other assets |  |  | - |  |  |  | - |  |  |  | (16,135) |
Total other income (expense) |  |  | 393,820 |  |  |  | 31,850 |  |  |  | (195,800) |
Earnings (loss) before income taxes |  |  | 713,628 |  |  |  | 336,262 |  |  |  | (102,817) |
Current income tax expense |  |  | (61,584) |  |  |  | (126,180) |  |  |  | (17,870) |
Deferred income tax benefit |  |  | 87,240 |  |  |  | 19,447 |  |  |  | 14,290 |
Total income tax benefit (expense) |  |  | 25,656 |  |  |  | (106,733) |  |  |  | (3,580) |
Earnings (loss) from continuing operations |  |  | 739,284 |  |  |  | 229,529 |  |  |  | (106,397) |
Discontinued operations: |  |  |  |  |  |  |  |  |  |  |  |
Income attributable to disposed properties and assets held for sale |  |  | - |  |  |  | 6,970 |  |  |  | 40,827 |
Net gains on dispositions, including related impairment charges and taxes |  |  | - |  |  |  | 116,550 |  |  |  | 35,098 |
Total discontinued operations |  |  | - |  |  |  | 123,520 |  |  |  | 75,925 |
Consolidated net earnings (loss) |  |  | 739,284 |  |  |  | 353,049 |  |  |  | (30,472) |
Net earnings attributable to noncontrolling interests |  |  | (100,900) |  |  |  | (8,920) |  |  |  | (9,410) |
Net earnings (loss) attributable to controlling interests |  |  | 638,384 |  |  |  | 344,129 |  |  |  | (39,882) |
Less preferred unit distributions |  |  | 7,431 |  |  |  | 18,391 |  |  |  | 41,226 |
Loss on preferred unit redemption / repurchase |  |  | 6,517 |  |  |  | 9,108 |  |  |  | - |
Net earnings (loss) attributable to common unitholders |  | $ | 624,436 |  |  | $ | 316,630 |  |  | $ | (81,108) |
Weighted average common units outstanding - Basic |  |  | 501,349 |  |  |  | 487,936 |  |  |  | 461,848 |
Weighted average common units outstanding - Diluted |  |  | 506,391 |  |  |  | 491,546 |  |  |  | 461,848 |
Net earnings (loss) per unit attributable to common unitholders - Basic: |  |  |  |  |  |  |  |  |  |  |  |
Continuing operations |  | $ | 1.25 |  |  | $ | 0.40 |  |  | $ | (0.34) |
Discontinued operations |  |  | - |  |  |  | 0.25 |  |  |  | 0.16 |
Net earnings (loss) per unit attributable to common unitholders - Basic |  | $ | 1.25 |  |  | $ | 0.65 |  |  | $ | (0.18) |
Net earnings (loss) per unit attributable to common unitholders - Diluted: |  |  |  |  |  |  |  |  |  |  |  |
Continuing operations |  | $ | 1.24 |  |  | $ | 0.39 |  |  | $ | (0.34) |
Discontinued operations |  |  | - |  |  |  | 0.25 |  |  |  | 0.16 |
Net earnings (loss) per unit attributable to common unitholders - Diluted |  | $ | 1.24 |  |  | $ | 0.64 |  |  | $ | (0.18) |
Distributions per common unit |  | $ | 1.32 |  |  | $ | 1.12 |  |  | $ | 1.12 |

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

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PROLOGIS, L.P.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

Years Ended December 31, 2014, 2013 and 2012

(In thousands)

|  | 2014 |  |  | 2013 |  |  | 2012 |
Consolidated net earnings (loss) |  | $ | 739,284 |  |  | $ | 353,049 |  |  | $ | (30,472) |
Other comprehensive income (loss): |  |  |  |  |  |  |  |  |  |  |  |
Foreign currency translation losses, net |  |  | (171,401) |  |  |  | (234,680) |  |  |  | (79,014) |
Unrealized gains (losses) and amortization on derivative contracts, net |  |  | (6,498) |  |  |  | 19,590 |  |  |  | 17,986 |
Comprehensive income (loss) |  |  | 561,385 |  |  |  | 137,959 |  |  |  | (91,500) |
Net earnings attributable to noncontrolling interests |  |  | (100,900) |  |  |  | (8,920) |  |  |  | (9,410) |
Other comprehensive loss attributable to noncontrolling interests |  |  | 12,666 |  |  |  | 12,261 |  |  |  | 9,573 |
Comprehensive income (loss) attributable to common unitholders |  | $ | 473,151 |  |  | $ | 141,300 |  |  | $ | (91,337) |

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

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PROLOGIS, L.P.

CONSOLIDATED STATEMENTS OF CAPITAL

Years Ended December 31, 2014, 2013 and 2012

(In thousands)

|  | General Partner |  |  | Limited Partners |  |  | Non- controlling Interests |  |  | Total |
|  | Preferred |  |  | Common |  |  | Common |  |  |
|  | Units |  |  | Amount |  |  | Units |  |  | Amount |  |  | Units |  |  | Amount |  |  |
Balance at January 1, 2012 |  |  | 21,300 |  |  | $ | 582,200 |  |  |  | 459,401 |  |  | $ | 13,079,439 |  |  |  | 2,059 |  |  | $ | 58,613 |  |  | $ | 735,222 |  |  | $ | 14,455,474 |
Consolidated net earnings (loss) |  |  | - |  |  |  | - |  |  |  | - |  |  |  | (39,720) |  |  |  | - |  |  |  | (162) |  |  |  | 9,410 |  |  |  | (30,472) |
Adjustment to the Merger purchase price allocation |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 10,163 |  |  |  | 10,163 |
Effect of equity compensation plans |  |  | - |  |  |  | - |  |  |  | 2,258 |  |  |  | 72,932 |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 72,932 |
Noncontrolling interests, issuances (conversions), net |  |  | - |  |  |  | - |  |  |  | 111 |  |  |  | 2,381 |  |  |  | - |  |  |  | - |  |  |  | (2,381) |  |  |  | - |
Capital contributions, net |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 74,447 |  |  |  | 74,447 |
Purchase of noncontrolling interests |  |  | - |  |  |  | - |  |  |  | - |  |  |  | (13,998) |  |  |  | - |  |  |  | - |  |  |  | (122,258) |  |  |  | (136,256) |
Foreign currency translation losses, net |  |  | - |  |  |  | - |  |  |  | - |  |  |  | (69,155) |  |  |  | - |  |  |  | (286) |  |  |  | (9,573) |  |  |  | (79,014) |
Unrealized gains and amortization on derivative contracts, net |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 17,913 |  |  |  | - |  |  |  | 73 |  |  |  | - |  |  |  | 17,986 |
Distributions and allocations |  |  | - |  |  |  | - |  |  |  | - |  |  |  | (562,975) |  |  |  | (166) |  |  |  | (7,044) |  |  |  | (41,905) |  |  |  | (611,924) |
Balance at December 31, 2012 |  |  | 21,300 |  |  | $ | 582,200 |  |  |  | 461,770 |  |  | $ | 12,486,817 |  |  |  | 1,893 |  |  | $ | 51,194 |  |  | $ | 653,125 |  |  | $ | 13,773,336 |
Consolidated net earnings |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 342,921 |  |  |  | - |  |  |  | 1,208 |  |  |  | 8,920 |  |  |  | 353,049 |
Effect of equity compensation plans |  |  | - |  |  |  | - |  |  |  | 1,351 |  |  |  | 93,705 |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 93,705 |
Issuance of units in exchange for contribution of equity offering proceeds |  |  | - |  |  |  | - |  |  |  | 35,650 |  |  |  | 1,437,697 |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 1,437,697 |
Redemption of preferred units |  |  | (19,300) |  |  |  | (482,200) |  |  |  | - |  |  |  | (515) |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | (482,715) |
Issuance of warrant by Prologis, Inc. |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 32,359 |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 32,359 |
Capital contributions |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 146,130 |  |  |  | 146,130 |
Settlement of noncontrolling interests |  |  | - |  |  |  | - |  |  |  | 28 |  |  |  | (7,868) |  |  |  | - |  |  |  | - |  |  |  | (242,745) |  |  |  | (250,613) |
Foreign currency translation losses, net |  |  | - |  |  |  | - |  |  |  | - |  |  |  | (221,633) |  |  |  | - |  |  |  | (786) |  |  |  | (12,261) |  |  |  | (234,680) |
Unrealized gains and amortization on derivative contracts, net |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 19,521 |  |  |  | - |  |  |  | 69 |  |  |  | - |  |  |  | 19,590 |
Distributions and allocations |  |  | - |  |  |  | - |  |  |  | - |  |  |  | (571,846) |  |  |  | (126) |  |  |  | (3,476) |  |  |  | (136,083) |  |  |  | (711,405) |
Balance at December 31, 2013 |  |  | 2,000 |  |  | $ | 100,000 |  |  |  | 498,799 |  |  | $ | 13,611,158 |  |  |  | 1,767 |  |  | $ | 48,209 |  |  | $ | 417,086 |  |  | $ | 14,176,453 |
Consolidated net earnings |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 636,183 |  |  |  | - |  |  |  | 2,201 |  |  |  | 100,900 |  |  |  | 739,284 |
Effect of equity compensation plans |  |  | - |  |  |  | - |  |  |  | 1,383 |  |  |  | 88,438 |  |  |  | - |  |  |  | 450 |  |  |  | - |  |  |  | 88,888 |
Issuance of units in exchange for contribution of at-the-market offering proceeds |  |  | - |  |  |  | - |  |  |  | 3,316 |  |  |  | 140,135 |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 140,135 |
Repurchase of preferred units |  |  | (435) |  |  |  | (21,765) |  |  |  | - |  |  |  | (5,878) |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | (27,643) |
Issuance of units in exchange for proceeds from exercise of warrant |  |  | - |  |  |  | - |  |  |  | 6,000 |  |  |  | 213,840 |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 213,840 |
Formation of Prologis U.S. Logistics Venture |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 13,721 |  |  |  | - |  |  |  | - |  |  |  | 442,251 |  |  |  | 455,972 |
Consolidation of Prologis North American Industrial Fund |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 12,507 |  |  |  | - |  |  |  | - |  |  |  | 554,493 |  |  |  | 567,000 |
Capital contributions |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 14,464 |  |  |  | 14,464 |
Settlement of noncontrolling interests |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 33,803 |  |  |  | - |  |  |  | - |  |  |  | (36,243) |  |  |  | (2,440) |
Foreign currency translation losses, net |  |  | - |  |  |  | - |  |  |  | - |  |  |  | (167,950) |  |  |  | - |  |  |  | (548) |  |  |  | (12,666) |  |  |  | (181,164) |
Unrealized losses and amortization on derivative contracts, net |  |  | - |  |  |  | - |  |  |  | - |  |  |  | (9,219) |  |  |  | - |  |  |  | (23) |  |  |  | - |  |  |  | (9,242) |
Distributions and allocations |  |  | - |  |  |  | - |  |  |  | - |  |  |  | (669,464) |  |  |  | - |  |  |  | (2,100) |  |  |  | (320,384) |  |  |  | (991,948) |
Balance at December 31, 2014 |  |  | 1,565 |  |  | $ | 78,235 |  |  |  | 509,498 |  |  | $ | 13,897,274 |  |  |  | 1,767 |  |  | $ | 48,189 |  |  | $ | 1,159,901 |  |  | $ | 15,183,599 |

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

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PROLOGIS, L.P.

CONSOLIDATED STATEMENTS OF CASH FLOWS

Years Ended December 31, 2014, 2013 and 2012

(In thousands)

|  | 2014 |  |  | 2013 |  |  | 2012 |
Operating activities: |  |  |  |  |  |  |  |  |  |  |  |
Consolidated net earnings (loss) |  | $ | 739,284 |  |  | $ | 353,049 |  |  | $ | (30,472) |
Adjustments to reconcile net earnings (loss) to net cash provided by operating activities: |  |  |  |  |  |  |  |  |  |  |  |
Straight-lined rents |  |  | (42,829) |  |  |  | (46,861) |  |  |  | (62,290) |
Equity-based compensation awards |  |  | 57,478 |  |  |  | 49,239 |  |  |  | 32,138 |
Depreciation and amortization |  |  | 642,461 |  |  |  | 664,007 |  |  |  | 767,459 |
Earnings from unconsolidated entities, net |  |  | (134,288) |  |  |  | (97,220) |  |  |  | (31,676) |
Distributions and net changes in operating receivables from unconsolidated entities |  |  | 110,435 |  |  |  | 75,859 |  |  |  | 6,581 |
Amortization of debt and lease intangibles |  |  | 21,113 |  |  |  | 10,140 |  |  |  | 21,008 |
Non-cash Merger, acquisition and other integration expenses |  |  | - |  |  |  | - |  |  |  | 17,581 |
Impairment of real estate properties and other assets |  |  | - |  |  |  | - |  |  |  | 269,049 |
Gains on dispositions of investments in real estate and revaluation of equity investments upon acquisition of a controlling interest, net |  |  | (725,790) |  |  |  | (715,758) |  |  |  | (348,615) |
Losses on early extinguishment of debt, net |  |  | 165,300 |  |  |  | 277,014 |  |  |  | 14,114 |
Unrealized foreign currency and derivative losses (gains) and related amortization, net |  |  | 22,571 |  |  |  | 28,619 |  |  |  | 14,892 |
Deferred income tax benefit |  |  | (87,240) |  |  |  | (20,067) |  |  |  | (21,967) |
Increase in accounts receivable and other assets |  |  | (93) |  |  |  | (12,912) |  |  |  | (178,387) |
Decrease in accounts payable and accrued expenses and other liabilities |  |  | (63,871) |  |  |  | (80,120) |  |  |  | (5,923) |
Net cash provided by operating activities |  |  | 704,531 |  |  |  | 484,989 |  |  |  | 463,492 |
Investing activities: |  |  |  |  |  |  |  |  |  |  |  |
Real estate development activity |  |  | (1,051,181) |  |  |  | (845,234) |  |  |  | (793,349) |
Real estate acquisitions |  |  | (612,330) |  |  |  | (514,611) |  |  |  | (254,414) |
Tenant improvements and lease commissions on previously leased space |  |  | (133,957) |  |  |  | (145,424) |  |  |  | (133,558) |
Non-development capital expenditures |  |  | (78,610) |  |  |  | (82,610) |  |  |  | (80,612) |
Investments in and advances to unconsolidated entities |  |  | (739,635) |  |  |  | (1,221,155) |  |  |  | (165,011) |
Return of investment from unconsolidated entities |  |  | 244,306 |  |  |  | 411,853 |  |  |  | 291,679 |
Proceeds from dispositions and contributions of real estate properties |  |  | 2,285,488 |  |  |  | 5,409,745 |  |  |  | 1,975,036 |
Acquisition of a controlling interest in unconsolidated co-investment ventures, net of cash received |  |  | (590,390) |  |  |  | (678,642) |  |  |  | (365,156) |
Proceeds from repayment of notes receivable backed by real estate |  |  | 188,000 |  |  |  | - |  |  |  | 55,000 |
Net cash provided by (used in) investing activities |  |  | (488,309) |  |  |  | 2,333,922 |  |  |  | 529,615 |
Financing activities: |  |  |  |  |  |  |  |  |  |  |  |
Proceeds from issuance of common partnership units in exchange for contributions from Prologis, Inc. |  |  | 378,247 |  |  |  | 1,505,791 |  |  |  | 30,981 |
Distributions paid on common and preferred units |  |  | (674,344) |  |  |  | (580,862) |  |  |  | (575,807) |
Redemption of preferred units |  |  | (27,643) |  |  |  | (482,500) |  |  |  | - |
Noncontrolling interest contributions |  |  | 468,280 |  |  |  | 145,522 |  |  |  | 70,820 |
Noncontrolling interest distributions |  |  | (313,272) |  |  |  | (113,928) |  |  |  | (41,905) |
Purchase of noncontrolling interest |  |  | (2,440) |  |  |  | (245,803) |  |  |  | (136,256) |
Debt and capital issuance costs paid |  |  | (23,420) |  |  |  | (77,017) |  |  |  | (10,963) |
Net proceeds from (payments on) credit facilities |  |  | (717,369) |  |  |  | (93,075) |  |  |  | 9,064 |
Repurchase and payment of debt |  |  | (4,205,806) |  |  |  | (6,012,433) |  |  |  | (1,850,699) |
Proceeds from the issuance of debt |  |  | 4,779,950 |  |  |  | 3,588,683 |  |  |  | 1,433,254 |
Net cash used in financing activities |  |  | (337,817) |  |  |  | (2,365,622) |  |  |  | (1,071,511) |
Effect of foreign currency exchange rate changes on cash |  |  | (18,842) |  |  |  | (62,970) |  |  |  | 3,142 |
Net increase (decrease) in cash and cash equivalents |  |  | (140,437) |  |  |  | 390,319 |  |  |  | (75,262) |
Cash and cash equivalents, beginning of year |  |  | 491,129 |  |  |  | 100,810 |  |  |  | 176,072 |
Cash and cash equivalents, end of year |  | $ | 350,692 |  |  | $ | 491,129 |  |  | $ | 100,810 |

See Note 21 for information on non-cash investing and financing activities and other information.

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

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PROLOGIS, INC. AND PROLOGIS, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1. | Description of Business

Prologis, Inc. (or the “Parent”) commenced operations as a fully integrated real estate company in 1997, elected to be taxed as a real estate investment trust (“REIT”) under the Internal Revenue Code of 1986, as amended (the “Internal Revenue Code”), and believes the current organization and method of operation will enable it to maintain its status as a REIT. The Parent is the general partner of Prologis, L.P. (or the “Operating Partnership”). Through the Operating Partnership, we are engaged in the ownership, acquisition, development and operation of industrial properties in global and regional markets throughout the Americas, Europe and Asia. Our current business strategy is comprised of two operating business segments: Real Estate Operations and Strategic Capital. Our Real Estate Operations segment represents the ownership of industrial properties. Our Strategic Capital segment represents the management of co-investment ventures and other unconsolidated entities. See Note 20 for further discussion of our business segments. Unless otherwise indicated, the notes to the Consolidated Financial Statements apply to both the Parent and the Operating Partnership. The terms “the Company,” “Prologis,” “we,” “our” or “us” means the Parent and Operating Partnership collectively.

For each share of common stock or preferred stock the Parent issues, the Operating Partnership issues a corresponding common or preferred partnership unit, as applicable, to the Parent in exchange for the contribution of the proceeds from the stock issuance. At December 31, 2014, the Parent owned an approximate 99.65% common general partnership interest in the Operating Partnership, and 100% of the preferred units in the Operating Partnership. The remaining approximate 0.35% common limited partnership interests are owned by non-affiliated investors and certain current and former directors and officers of the Parent. As the sole general partner of the Operating Partnership, the Parent has full, exclusive and complete responsibility and discretion in the day-to-day management and control of the Operating Partnership.

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

Information with respect to the square footage, number of buildings and acres of land is unaudited.

2. | Summary of Significant Accounting Policies

Basis of Presentation and Consolidation. The accompanying Consolidated Financial Statements are prepared in accordance with United States generally accepted accounting principles (“GAAP”) and are presented in our reporting currency, the U.S. dollar. All material intercompany transactions with consolidated entities have been eliminated.

We consolidate all entities that are wholly-owned and those in which we own less than 100% of the equity but control, as well as any variable interest entities in which we are the primary beneficiary. We evaluate our ability to control an entity and whether the entity is a variable interest entity and we are the primary beneficiary through consideration of substantive terms of the arrangement to identify which enterprise has the power to direct the activities of the entity that most significantly impacts the entity’s economic performance and the obligation to absorb losses of the entity or the right to receive benefits from the entity.

For entities that are not defined as variable interest entities, we first consider whether we are the general partner or the limited partner (or the equivalent in such investments which are not structured as partnerships). We consolidate entities in which we are the general partner and the limited partners in such entities do not have rights which would preclude control. For entities in which we are the general partner but do not control the entity as the other partners hold substantive participating and/or kick-out rights we apply the equity method of accounting since as the general partner we have the ability to influence the venture. For ventures for which we are a limited partner or our investment is in an entity that is not structured similar to a partnership, we consider factors such as ownership interest, voting control, authority to make decisions, and contractual and substantive participating rights of the partners. In instances where the factors indicate that we control the venture, we consolidate the entity.

Reclassifications. Certain amounts included in the Consolidated Financial Statements for 2013 and 2012 have been reclassified to conform to the 2014 financial statement presentation. We reclassified the balances in the Consolidated Balance Sheet at December 31, 2013, for derivative assets from Accounts Receivable to Other Assets and for derivative liabilities from Accounts Payable and Accrued Expenses to Other Liabilities. See Note 7 for the detail of these amounts.

Use of Estimates. GAAP requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements, and revenue and expenses during the reporting period. Although we believe the assumptions and estimates we made are reasonable and appropriate, as discussed in the applicable sections throughout the Consolidated Financial Statements, different assumptions and estimates could materially impact our reported results.

Foreign Operations. The U.S. dollar is the functional currency for our consolidated subsidiaries and unconsolidated entities operating in the United States and Mexico and certain of our consolidated subsidiaries that operate as holding companies for foreign investments. The

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functional currency for our consolidated subsidiaries and unconsolidated entities operating in countries other than the United States and Mexico is the principal currency in which the entity’s assets, liabilities, income and expenses are denominated, which may be different from the local currency of the country of incorporation or where the entity conducts its operations.

The functional currencies of our consolidated subsidiaries and unconsolidated entities generally include the Brazilian real, British pound sterling, Canadian dollar, Chinese renminbi, euro, Japanese yen, and Singapore dollar. We are parties to business transactions denominated in these and other local currencies where we operate.

For our consolidated subsidiaries whose functional currency is not the U.S. dollar, we translate their financial statements into the U.S. dollar at the time we consolidate those subsidiaries’ financial statements. Generally, assets and liabilities are translated at the exchange rate in effect at the balance sheet date. The resulting translation adjustments are included in Accumulated Other Comprehensive Loss (“AOCI”) in the Consolidated Balance Sheets. Certain balance sheet items, primarily equity and capital-related accounts, are reflected at the historical exchange rate. Income statement accounts are translated using the average exchange rate for the period and income statement accounts that represent significant non-recurring transactions are translated at the rate in effect at the date of the transaction. We translate our share of the net earnings or losses of our unconsolidated entities whose functional currency is not the U.S. dollar at the average exchange rate for the period.

We and certain of our consolidated subsidiaries have intercompany and third-party debt that is not denominated in the entity’s functional currency. When the debt is remeasured against the functional currency of the entity, a gain or loss can result. The resulting adjustment is reflected in results of operations, unless it is intercompany debt that is deemed to be long-term in nature and then the adjustment is reflected as a cumulative translation adjustment in AOCI in the Consolidated Balance Sheets.

Business Combinations. When we acquire a business, which may include an operating property, we record the acquisition at the fair value of assets acquired and liabilities assumed. Transaction costs related to business combinations are expensed as incurred. We generally acquire operating properties that meet the definition of a business. The transaction costs related to the acquisition of land and the formation of equity method investments are capitalized.

When we acquire a business or individual operating properties, we allocate the purchase price to the various components of the acquisition based upon the fair value of the acquired assets and liabilities. The initial allocation of the purchase price is based on management’s preliminary assessment, which may differ when final information becomes available. Subsequent adjustments made to the initial purchase price allocation are made within the allocation period, not to exceed one year.

When we obtain control of an unconsolidated entity, we account for the acquisition of the entity in accordance with the guidance for a business combination achieved in stages. We remeasure our previously held interest in the unconsolidated entity at its acquisition-date fair value and recognize the resulting gain or loss, if any, in earnings at the acquisition date.

We allocate the purchase price using primarily level 2 and 3 inputs (further defined in Fair Value Measurements below) as follows:

Investments in Real Estate Properties. We value operating properties as if vacant. We estimate fair value generally by applying an income approach methodology using a discounted cash flow analysis. Key assumptions in the discounted cash flow analysis include market rents, growth rates and discount and capitalization rates. We determine discount and capitalization rates by market based on recent transactions and other market data. The fair value of land is generally based on relevant market data, such as a comparison of the subject site to similar parcels that have recently been sold or are currently being offered on the market for sale.

Intangible Assets. We determine the portion of the purchase price related to intangible assets as follows:

| • |  | In Place Leases. We calculate the fair value of in place leases based upon our estimate of the costs to obtain tenants, primarily leasing commissions, in each of the applicable markets. The value is recorded in other assets and amortized over the average remaining estimated life of the lease to amortization expense.

| • |  | Above and Below Market Leases. We recognize an asset or liability for acquired leases with favorable or unfavorable rents based on our estimate of current market rents of the applicable markets. The value is recorded in either other assets or other liabilities, as appropriate, and is amortized over the average remaining estimated life of the lease to rental income.

| • |  | Contracts to Provide Management Services. We calculate the value of existing agreements to provide management services by discounting future expected cash flows. The value is recorded as management contracts in Other Assets in the Consolidated Balance Sheets and amortized over the remaining term of the agreement to amortization expense.

Debt. We estimate the fair value of debt based on contractual future cash flows discounted using borrowing spreads and market interest rates that would be available to us for the issuance of debt with similar terms and remaining maturities. In the case of publicly traded debt, we estimate the fair value based on available market data. Any discount or premium to the principal amount is included in the carrying value and amortized over the remaining term of the related debt using the effective interest method to interest expense.

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Noncontrolling Interest. We estimate the portion of the fair value of the net assets owned by third parties based on the fair value of the consolidated net assets, principally real estate properties and debt.

Working Capital. We base the fair value of all other acquired assets and assumed liabilities on the best information available.

Fair Value Measurements. The objective of fair value is to determine the price that would be received upon the sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (the exit price). We estimate fair value using available market information and valuation methodologies we believe to be appropriate for these purposes. Considerable judgment and a high degree of subjectivity are involved in developing these estimates and, accordingly, they are not necessarily indicative of amounts that we would realize upon disposition. The fair value hierarchy consists of three broad levels:

| • |  | Level 1 — Quoted prices (unadjusted) in active markets for identical assets or liabilities that the entity can access at the measurement date.

| • |  | Level 2 — Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly.

| • |  | Level 3 — Unobservable inputs for the asset or liability.

Long-Lived Assets.

Real Estate Assets. Real estate assets are carried at depreciated cost. We capitalize costs incurred in developing, renovating, rehabilitating and improving real estate assets as part of the investment basis of real estate assets. We expense costs for making repairs and maintaining the real estate assets as incurred.

During the land development and construction periods of qualifying projects, we capitalize interest costs, insurance, real estate taxes and general and administrative costs of the personnel performing the development, renovation, and rehabilitation; if such costs are incremental and identifiable to a specific activity to ready the asset for its intended use. We capitalize costs incurred to successfully originate a lease that results directly from and are essential to acquire that lease, including internal costs that are incremental and identifiable as leasing activities. Leasing costs that meet the requirements for capitalization are presented as a component of Other Assets in the Consolidated Balance Sheets.

We charge the depreciable portions of real estate assets to depreciation expense on a straight-line basis over the respective estimated useful lives. Depreciation commences when the asset is ready for its intended use, which we define as the earlier of stabilization (90% occupied) or one year after completion of construction. We generally use the following useful lives: five to seven years for capital improvements, 10 years for standard tenant improvements, 25 years for depreciable land improvements, 30 years for operating properties acquired and 40 years for operating properties we develop. We depreciate building improvements on land parcels subject to ground leases over the shorter of the estimated building improvement life or the contractual term of the underlying ground lease. Capitalized leasing costs are amortized over the estimated remaining lease term. Our weighted average lease term based on square feet for all leases, in effect at December 31, 2014, was seven years.

We assess the carrying values of our respective long-lived assets, whenever events or changes in circumstances indicate that the carrying amounts of these assets may not be fully recoverable. We consider current market conditions, as well as our intent with respect to holding or disposing of the asset. We measure the recoverability of the real estate asset by comparison of the carrying amount of the asset to the estimated future undiscounted cash flows. If our analysis indicates that the carrying value of the real estate property that we expect to hold is not recoverable on an undiscounted cash flow basis, we recognize an impairment charge for the amount by which the carrying value exceeds the current estimated fair value of the real estate property. We determine fair value through various valuation techniques; including discounted cash flow models, quoted market values, and third-party appraisals; where considered necessary. When we decide to sell an asset we compare the carrying value of the property to its estimated fair value based on estimated selling price less costs to sell and recognize an impairment for any excess.

We estimate the future undiscounted cash flows based on our intent as follows:

(i) | for real estate properties that we intend to hold long-term; including land held for development, properties currently under development and operating buildings; recoverability is assessed based on the estimated undiscounted future net rental income from operating the property and the terminal value;

(ii) | for land parcels we intend to sell, recoverability is assessed based on estimated proceeds from disposition;

(iii) | for real estate properties currently under development and operating buildings we intend to sell, recoverability is assessed based on proceeds from disposition that are estimated based on future net rental income of the property and expected market capitalization rates; and

(iv) | for costs incurred related to the potential acquisition of land or development of a real estate property, recoverability is assessed based on the probability that the acquisition or development is likely to occur at the measurement date.

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We base projected future cash flows on assumptions that are consistent with our estimates of future expectations and the strategic plan we use to manage our underlying business. However, assumptions and estimates about future cash flows, discount rates and capitalization rates are complex and subjective. Changes in economic and operating conditions and our intent with regard to our investment that occurs subsequent to our impairment analyses could impact these assumptions and result in future impairment of our long-lived assets.

Assets Held for Sale. We classify a component of our business or property as held for sale when certain criteria are met, in accordance with GAAP. At such time, the respective assets and liabilities are presented separately in the Consolidated Balance Sheets and depreciation is no longer recognized. Assets held for sale are reported at the lower of their carrying amount or their estimated fair value less the costs to sell the assets.

Discontinued Operations. As discussed in the New Accounting Pronouncements below, beginning in 2014, only disposals of a component of an entity, or a group of components of an entity, representing a strategic shift in operations would be presented as discontinued operations. Under this guidance, none of our property dispositions qualified as discontinued operations in 2014. However, in 2013 and 2012 the results of operations for real estate properties sold during the reported periods or held for sale at the end of the reported periods were shown under Discontinued Operations in the Consolidated Statements of Operations following the previous accounting standard.

Investments in Unconsolidated Entities. We present our investments in certain entities under the equity method. We use the equity method when we have the ability to exercise significant influence over operating and financial policies of the venture but do not have control of the entity. Under the equity method, we initially recognize these investments (including advances) in the balance sheet at our cost which would include deferred gains from the contribution of properties, if applicable. We subsequently adjust the accounts to reflect our proportionate share of net earnings or losses recognized, our share of accumulated other comprehensive income or loss, distributions received and certain other adjustments, as appropriate. When circumstances indicate there may have been a reduction in the value of an equity investment, we evaluate whether the loss in value is other than temporary. If we conclude it is other than temporary, we recognize an impairment charge to reflect the equity investment at fair value.

Cash and Cash Equivalents. We consider all cash on hand, demand deposits with financial institutions, and short-term highly liquid investments with original maturities of three months or less to be cash equivalents. Our cash and cash equivalents are financial instruments that are exposed to concentrations of credit risk. We invest our cash with high-credit quality institutions. Cash balances may be invested in money market accounts that are not insured. We have not realized any losses in such cash investments or accounts and believe that we are not exposed to any significant credit risk.

Financial Instruments. We may use derivative financial instruments for the purpose of managing foreign currency exchange rate and interest rate risk. We reflect our derivative financial instruments at fair value and record changes in the fair value of these derivatives each period in earnings, unless hedge accounting criteria are met. See Note 18 for a discussion of our financial instruments.

Exchangeable Debt. Our exchangeable notes were issued by the Operating Partnership and are exchangeable into common stock of the Parent. The accounting for the exchangeable senior notes required us to separate the fair value of the derivative instrument (exchange feature) from the debt instrument and account for it separately as a derivative. At each reporting period, we adjust the derivative instrument to fair value with the adjustment being recorded in earnings as Foreign Currency and Derivative Losses and Related Amortization, Net and the derivative reflected in Other Liabilities. We amortize the discount over the remaining term of the exchangeable notes.

Noncontrolling Interests. Noncontrolling interests represent the share of consolidated entities owned by third parties. We recognize each noncontrolling holder’s respective share of the estimated fair value of the net assets at the date of formation or acquisition. Noncontrolling interest is subsequently adjusted for the noncontrolling holder’s share of additional contributions, distributions and the proportionate share of the net earnings or losses of each respective entity. If we establish a new consolidated entity or contribute a property to or liquidate an existing consolidated entity in which we do not own 100% of the ownership interests, we reflect the difference in cash received or paid from the noncontrolling interests carrying amount as paid-in-capital with no gain or loss recognized.

Certain limited partnership interests issued by us in connection with the formation of a real estate partnership and as consideration in a business combination are exchangeable into our common stock. Common stock issued upon exchange of a holder’s noncontrolling interest is accounted for at our carrying value of the surrendered noncontrolling interest, and any differences reflected in Additional Paid-in-Capital on the Consolidated Balance Sheets.

Costs of Raising Capital. We treat costs incurred in connection with the issuance of common and preferred stock as a reduction to additional paid-in capital. We capitalize costs incurred in connection with the issuance of debt in other assets, and amortize to interest expense over the term of the related debt. Costs associated with debt modifications are expensed when incurred.

Accumulated Other Comprehensive Income (Loss). For the Parent, we include AOCI as a separate component of stockholders’ equity in the Consolidated Balance Sheets. For the Operating Partnership, AOCI is included in partners’ capital in the Consolidated Balance Sheets. Any reference to AOCI in this document is referring to the component of stockholders’ equity for the Parent and partners’ capital for the Operating Partnership.

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Revenue Recognition.

Rental Income. We lease our operating properties to customers under agreements that are classified as operating leases. We recognize the total minimum lease payments provided for under the leases on a straight-line basis over the lease term. Generally, under the terms of our leases, the majority of our rental expenses are recovered from our customers. We reflect amounts recovered from customers as revenue in the period that the applicable expenses are incurred. We make a provision for possible loss if the collection of a receivable balance is considered doubtful.

Strategic Capital Income. Strategic capital income includes revenues we earn from the management services we provide to unconsolidated entities. These fees are determined in accordance with the terms specific to each arrangement and may include property and asset management fees or transactional fees for leasing, acquisition, construction, financing, legal and tax services provided. We may also earn incentive returns (we refer to these as promotes) based on third-party investor returns over time, which may be during the duration of the venture or at the time of liquidation. We recognize fees when they are earned, fixed and determinable. We report these fees in Strategic Capital Income in the Consolidated Statements of Operations. In addition, we may earn fees for services provided to develop properties within these ventures and those fees are reflected in Development Management and Other Income in the Consolidated Statements of Operations on a percentage of completion basis.

Gains (Losses) on Dispositions of Investments in Real Estate. We recognize gains on the disposition of real estate when the recognition criteria have been met, generally at the time the risks and rewards and title have transferred and we no longer have substantial continuing involvement with the real estate sold. We recognize losses from the disposition of real estate when known.

When we contribute a property to an unconsolidated entity in which we have an ownership interest, we do not recognize a portion of the gain realized. The amount of gain not recognized, based on our ownership interest in the entity acquiring the property, is deferred by recognizing a reduction to our investment in the applicable unconsolidated entity. We adjust our proportionate share of net earnings or losses recognized in future periods to reflect the entities’ recorded depreciation expense as if it were computed on our lower basis in the contributed properties rather than on the entity’s basis.

When a property that we originally contributed to an unconsolidated entity is disposed of to a third party, we recognize the amount of the gain we had previously deferred, along with our proportionate share of the gain recognized by the unconsolidated entity. If our ownership interest in an unconsolidated entity decreases and the decrease is expected to be permanent, we recognize the amounts relating to previously deferred gains to coincide with our new ownership interest.

Rental Expenses. Rental expenses primarily include the cost of our property management personnel, utilities, repairs and maintenance, property insurance and real estate taxes.

Strategic Capital Expenses. Strategic capital expenses include the direct expenses associated with the asset management of the unconsolidated co-investment ventures provided by our employees who are assigned to our Strategic Capital segment. In addition, in order to achieve efficiencies and economies of scale, all of our property management functions are provided by property management personnel who are assigned to our Real Estate Operations segment. These individuals perform the property-level management of the properties in our owned and managed portfolio including properties we consolidated and the properties we manage that are owned by the unconsolidated co-investment ventures. We allocate the costs of our property management to the properties we consolidate (included in Rental Expenses) and the properties owned by the unconsolidated co-investment ventures (included in Strategic Capital Expenses) by using the square feet owned by the respective portfolios.

Equity-Based Compensation. We account for equity-based compensation by measuring the cost of employee services received in exchange for an award of an equity instrument based on the fair value of the award on the grant date. We recognize the cost of the entire award on a straight-line basis over the period during which an employee is required to provide service in exchange for the award, generally the vesting period.

Income Taxes. Under the Internal Revenue Code, REITs are generally not required to pay federal income taxes if they distribute 100% of their taxable income and meet certain income, asset and stockholder tests. If we fail to qualify as a REIT in any taxable year, we will be subject to federal income taxes at regular corporate rates (including any alternative minimum tax) and may not be able to qualify as a REIT for the four subsequent taxable years. Even as a REIT, we may be subject to certain state and local taxes on our own income and property, and to federal income and excise taxes on our undistributed taxable income.

We have elected taxable REIT subsidiary (“TRS”) status for some of our consolidated subsidiaries. This allows us to provide services that would otherwise be considered impermissible for REITs. Many of the foreign countries in which we have operations do not recognize REITs or do not accord REIT status under their respective tax laws to our entities that operate in their jurisdiction. In the United States, we are taxed in certain states in which we operate. Accordingly, we recognize income tax expense for the federal and state income taxes incurred by our TRSs, taxes incurred in certain states and foreign jurisdictions, and interest and penalties associated with our unrecognized tax benefit liabilities.

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We evaluate tax positions taken in the Consolidated Financial Statements under the interpretation for accounting for uncertainty in income taxes. As a result of this evaluation, we may recognize a tax benefit from an uncertain tax position only if it is “more-likely-than-not” that the tax position will be sustained on examination by taxing authorities.

We recognize deferred income taxes in certain taxable entities. For federal income tax purposes, certain acquisitions have been treated as tax-free transactions resulting in a carry-over basis in assets and liabilities. For financial reporting purposes and in accordance with purchase accounting, we record all of the acquired assets and liabilities at the estimated fair value at the date of acquisition. For our taxable subsidiaries, including international jurisdictions, we recognize the deferred income tax liabilities that represent the tax effect of the difference between the tax basis carried over and the fair value of the tangible and intangible assets at the date of acquisition. Any increases or decreases to the deferred income tax liability recorded in connection with these acquisitions, related to tax uncertainties acquired, are reflected in earnings.

If taxable income is generated in these subsidiaries, we recognize a benefit in earnings as a result of the reversal of the deferred income tax liability previously recorded at the acquisition date and we record current income tax expense representing the entire current income tax liability. If the reversal of the deferred income tax liability results from a sale or contribution of assets, the classification of the reversal to the Consolidated Statement of Operations is based on the taxability of the transaction. We record the reversal to Deferred Income Tax Benefit as a taxable transaction if we dispose of the asset. We record the reversal as Gains on Dispositions of Investments in Real Estate and Revaluation of Equity Investments upon Acquisition of a Controlling Interest, Net as a non-taxable transaction if we dispose of the asset, as well as the entity that owns the asset.

Deferred income tax expense is generally a function of the period’s temporary differences (items that are treated differently for tax purposes than for financial reporting purposes) and the utilization of tax net operating losses generated in prior years that had been previously recognized as deferred income tax assets. We provide for a valuation allowance for deferred income tax assets if we believe all or some portion of the deferred income tax asset may not be realized. Any increase or decrease in the valuation allowance that results from a change in circumstances that causes a change in the estimated realizability of the related deferred income tax asset is included in deferred tax expense.

Environmental Costs. We incur certain environmental remediation costs, including cleanup costs, consulting fees for environmental studies and investigations, monitoring costs, and legal costs relating to cleanup, litigation defense, and the pursuit of responsible third parties. We expense costs incurred in connection with operating properties and properties previously sold. We capitalize costs related to undeveloped land as development costs and include any expected future environmental liabilities at the time of acquisition. We include costs incurred for properties to be disposed in the cost of the properties upon disposition. We maintain a liability for the estimated costs of environmental remediation expected to be incurred in connection with undeveloped land, operating properties and properties previously sold that we adjust as appropriate as information becomes available.

New Accounting Pronouncements. In May 2014, the Financial Accounting Standards Board (the “FASB”) issued an accounting standard update that requires companies to use a five step model to determine when to recognize revenue from customer contracts in an effort to increase consistency and comparability throughout global capital markets and across industries. Under the model, a company will identify the contract, identify any separate performance obligations in the contract, determine the transaction price, allocate the transaction price and recognize revenue when the performance obligation is satisfied. The new standard will replace most existing revenue recognition guidance in GAAP when it becomes effective for us on January 1, 2017. We have not yet selected a transition method nor have we determined the effect of the standard on our ongoing financial reporting.

In April 2014, the FASB issued an accounting standard update that changed the criteria for classifying and reporting discontinued operations while enhancing disclosures. Under the new guidance, only disposals of a component of an entity, or a group of components of an entity, representing a strategic shift in operations should be presented as discontinued operations. Those strategic shifts should have, or will have, a major effect on the organization’s operations and financial results. Examples of disposals that may meet the new criteria include a disposal of a major geographic area, a major line of business, or a major equity method investment. In addition, the new guidance requires additional disclosures about discontinued operations and the disposal of an individually significant component of an entity that does not meet the criteria for discontinued operations. We early adopted this standard prospectively for all disposals subsequent to January 1, 2014. Prior to adoption, the results of operations for real estate properties sold or held for sale during the reported periods were shown under Discontinued Operations in the Consolidated Statements of Operations (see Note 8). Going forward, we expect the majority of our property dispositions will not qualify as discontinued operations and the results of the dispositions will be presented in Income from Continuing Operations.

In March 2013, the FASB issued an accounting standard update on the accounting for currency translation adjustment (“CTA”) when a parent sells or transfers part of its ownership interest in a foreign entity. When a company sells a subsidiary or group of assets that constitute a business while maintaining ownership of the foreign entity in which those assets or subsidiary reside, a complete or substantially complete liquidation of the foreign entity is required in order for a parent entity to release CTA to earnings. However, for a company that sells all or part of its ownership interest in a foreign entity, CTA is released upon the loss of a controlling financial interest in a consolidated foreign entity or partial sale of an equity method investment in a foreign entity. For step acquisitions, the CTA associated with the previous equity-method investment is fully released when control is obtained and consolidation occurs. We adopted this standard at January 1, 2014, and it did not have a material impact in the Consolidated Financial Statements.

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3. | Business Combinations

Acquisition of a Controlling Interest in Prologis North American Industrial Fund

During 2014, we increased our ownership in Prologis North American Industrial Fund (“NAIF”) from 23.1% to 66.1% by acquiring the equity units from all but one partner for an aggregate of $679.0 million. This included the acquisition of $46.8 million on October 20, 2014 that resulted in our gaining control over NAIF, based on the rights of the limited partners, and therefore we began consolidating NAIF as of that date. When we acquire a controlling interest in an equity investment, we remeasure our equity investment to fair value, and as a result we may recognize a gain or loss. We recognized a gain of $201.3 million in Gains on Dispositions of Investments in Real Estate and Revaluation of Equity Investments upon Acquisition of a Controlling Interest, Net in the Consolidated Statements of Operations. The fair value was primarily based on external valuations.

The total purchase price was $1.1 billion, which included our investment in NAIF at the time of consolidation. The allocation of the purchase price required a significant amount of judgment and was based on our valuation, estimates and assumptions of the acquisition date fair value of the tangible and intangible assets and liabilities acquired, for which we used external valuations as appropriate. While the current allocation of the purchase price is substantially complete, the valuation of the real estate properties is still being finalized. We do not expect future revisions, if any, to have a significant impact on our financial position or results of operations. The allocation of the purchase price was as follows (in thousands):

Investments in real estate properties |  | $ | 2,770,191 |
Cash, accounts receivable and other assets |  |  | 132,261 |
Debt |  |  | (1,195,213) |
Accounts payable, accrued expenses and other liabilities |  |  | (70,226) |
Noncontrolling interests |  |  | (554,493) |
Total purchase price |  | $ | 1,082,520 |

Our results of operations for 2014 include rental income and rental expenses of the properties acquired in the NAIF acquisition of $49.2 million and $13.3 million, respectively, offset by the impact of noncontrolling interests.

2013 Acquisitions of Controlling Interests in Unconsolidated Co-Investment Ventures

During 2013, we acquired real estate from three unconsolidated co-investment ventures through the conclusion of the venture or the acquisition of our partner’s interest. In connection with these transactions, we remeasured our equity investment to fair value and recognized gains of $34.8 million in Gains on Dispositions of Investments in Real Estate and Revaluation of Equity Investments upon Acquisition of a Controlling Interest, Net in the Consolidated Statements of Operations. The fair value was primarily based on external valuations.

| • |  | On October 2, 2013, we acquired our partner’s 78.4% interest in the unconsolidated co-investment venture Prologis SGP Mexico and concluded the venture. The allocation of net assets acquired was $409.5 million in real estate properties and $4.0 million of net other assets and $158.4 million in debt. All properties acquired in this transaction were contributed in June 2014 to our new unconsolidated co-investment venture in Mexico, as discussed in Note 4.

| • |  | On August 6, 2013, we concluded the unconsolidated co-investment venture Prologis North American Industrial Fund III. The venture sold 73 properties to a third party and we subsequently acquired the remaining properties through the purchase of our partner’s 80% ownership interest in the venture. The allocation of net assets acquired was $519.2 million in real estate properties and $22.0 million of net other assets. These properties were contributed in January 2014 to a consolidated venture in which we own 55% of the equity as discussed in Note 12.

| • |  | In the second quarter of 2013, we concluded an unconsolidated co-investment venture in Japan.

The results of operations for these properties were not significant in 2013.

2012 Acquisitions of Controlling Interests in Unconsolidated Co-Investment Ventures

In 2012, we acquired all or a portion of the total properties in three of our unconsolidated co-investment ventures in the United States, collectively the “2012 Co-Investment Venture Acquisitions.” As a result of the 2012 Co-Investment Venture Acquisitions, we remeasured our equity investments in these co-investment ventures to fair value resulting in a gain of $286.3 million in Gains on Dispositions of Investments in Real Estate and Revaluation of Equity Investments upon Acquisition of a Controlling Interest, Net in the Consolidated Statements of Operations. The fair value was primarily based on external valuations. The allocation of net assets acquired for these acquisitions was approximately $2.3 billion in real estate properties, $50.3 million of net other assets and $1.0 billion in debt. Our results for 2012 include rental income and rental expenses of the properties acquired in the 2012 Co-Investment Venture Acquisitions of $170.6 million and $42.5 million, respectively.

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4. | Real Estate

Investments in real estate properties are presented at cost, and consist of the following at December 31 (dollars and square feet in thousands):

|  | Square Feet /Acres (1) |  |  | No. of Buildings (1) |  |  | Investment Balance |
|  | 2014 |  |  | 2013 |  |  | 2014 |  |  | 2013 |  |  | 2014 |  |  | 2013 |
Industrial operating properties: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Improved land |  |  | - - |  |  |  | - - |  |  |  | - - |  |  |  | - - |  |  | $ | 4,227,637 |  |  | $ | 4,074,647 |
Buildings and improvements |  |  | 282,282 |  |  |  | 267,097 |  |  |  | 1,607 |  |  |  | 1,610 |  |  |  | 14,407,815 |  |  |  | 13,726,417 |
Development portfolio, including land costs: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pre-stabilized |  |  | 7,448 |  |  |  | 4,491 |  |  |  | 24 |  |  |  | 11 |  |  |  | 547,982 |  |  |  | 204,022 |
Properties under development |  |  | 22,844 |  |  |  | 18,587 |  |  |  | 55 |  |  |  | 46 |  |  |  | 925,998 |  |  |  | 816,995 |
Land |  |  | 9,017 |  |  |  | 9,747 |  |  |  | - - |  |  |  | - - |  |  |  | 1,577,786 |  |  |  | 1,516,166 |
Other real estate investments (2) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 502,927 |  |  |  | 486,230 |
Total investments in real estate properties |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 22,190,145 |  |  |  | 20,824,477 |
Less accumulated depreciation |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 2,790,781 |  |  |  | 2,568,998 |
Net investments in real estate properties |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | $ | 19,399,364 |  |  | $ | 18,255,479 |

(1) | Items indicated by ‘- -‘are not applicable.

(2) | Included in other real estate investments are: (i) certain non-industrial real estate; (ii) our corporate office buildings; (iii) certain infrastructure costs related to projects we are developing on behalf of others; (iv) land parcels that are leased to third parties; (v) earnest money deposits associated with potential acquisitions; and (vi) costs related to future development projects, including purchase options on land.

At December 31, 2014, we owned real estate assets in the Americas (Canada, Mexico and the United States), Europe (Austria, Belgium, the Czech Republic, France, Germany, Hungary, Italy, the Netherlands, Poland, Romania, Slovakia, Spain, Sweden and the United Kingdom) and Asia (China, Japan and Singapore).

Acquisitions

Real estate acquisition activity for the years ended December 31 was as follows (dollars and square feet in thousands):

|  | 2014 |  |  | 2013 |  |  | 2012 |
Acquisitions of properties from unconsolidated co-investment ventures |  |  |  |  |  |  |  |  |  |  |  |
Number of industrial operating properties |  |  | 231 |  |  |  | 58 |  |  |  | 215 |
Square feet |  |  | 45,663 |  |  |  | 16,319 |  |  |  | 46,277 |
Real estate acquisition value |  | $ | 2,770,191 |  |  | $ | 1,141,128 |  |  | $ | 2,294,892 |
Gains on revaluation of equity investments upon acquisition of a controlling interest |  | $ | 201,319 |  |  | $ | 34,787 |  |  | $ | 286,335 |
Acquisitions of properties from third parties |  |  |  |  |  |  |  |  |  |  |  |
Number of industrial operating properties |  |  | 8 |  |  |  | 12 |  |  |  | 12 |
Square feet |  |  | 1,004 |  |  |  | 3,262 |  |  |  | 1,622 |
Real estate acquisition value |  | $ | 78,314 |  |  | $ | 146,331 |  |  | $ | 77,397 |

The acquisitions of controlling interests in unconsolidated co-investment ventures is discussed in Note 3.

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Dispositions

Real estate disposition activity for the years ended December 31 was as follows (dollars and square feet in thousands):

|  | 2014 |  |  | 2013 |  |  | 2012 |
Continuing Operations |  |  |  |  |  |  |  |  |  |  |  |
Contributions to unconsolidated co-investment ventures |  |  |  |  |  |  |  |  |  |  |  |
Number of properties |  |  | 126 |  |  |  | 254 |  |  |  | 25 |
Square feet |  |  | 25,247 |  |  |  | 71,503 |  |  |  | 4,784 |
Net proceeds |  | $ | 1,825,311 |  |  | $ | 6,479,707 |  |  | $ | 380,880 |
Net gains on contributions |  | $ | 188,268 |  |  | $ | 555,196 |  |  | $ | 1,958 |
Dispositions to third parties |  |  |  |  |  |  |  |  |  |  |  |
Number of properties |  |  | 145 |  |  |  | - |  |  |  | - |
Square feet |  |  | 19,856 |  |  |  | - |  |  |  | - |
Net proceeds (1) |  | $ | 1,365,318 |  |  | $ | 177,273 |  |  | $ | 94,587 |
Net gains on dispositions (1) |  | $ | 336,203 |  |  | $ | 7,673 |  |  | $ | 17,314 |
Discontinued Operations |  |  |  |  |  |  |  |  |  |  |  |
Number of properties |  |  | - |  |  |  | 89 |  |  |  | 200 |
Square feet |  |  | - |  |  |  | 9,196 |  |  |  | 27,169 |
Net proceeds from dispositions |  | $ | - |  |  | $ | 608,286 |  |  | $ | 1,562,189 |
Net gains from dispositions, including related impairment charges and taxes (2) |  | $ | - |  |  | $ | 116,550 |  |  | $ | 35,098 |

(1) | Dispositions to third parties include land sales.

(2) | We recorded $1.2 million and $0.2 million of income tax expense in 2013 and 2012, respectively, related to the disposition of properties in discontinued operations.

Detail of significant transactions with related parties (co-investment ventures)

In June 2014, we completed the initial public offering of FIBRA Prologis, a Mexican REIT, on the Mexican Stock Exchange. In connection with the offering, FIBRA Prologis purchased 177 properties aggregating 29.7 million square feet (12.6 million square feet related to wholly-owned properties, 7.6 million square feet from our consolidated co-investment venture Prologis Mexico Fondo Logistico (“AFORES”) and 9.5 million square feet from our unconsolidated co-investment venture Prologis Mexico Industrial Fund). We received 287.3 million equity units of FIBRA Prologis (priced at Ps 27.00 ($2.09)) in exchange for our combined investments, resulting in a 45% ownership interest that we account for under the equity method. Based on this transaction, we recognized a gain on disposition of investments in real estate of $52.5 million; current tax expense of $32.4 million; deferred tax benefit of $55.5 million; and earnings attributable to noncontrolling interest of $61.0 million.

In the first quarter of 2013, we completed the initial public offering of Nippon Prologis REIT, Inc. (“NPR”), a publicly traded company listed on the Tokyo Stock Exchange. NPR acquired a portfolio of 12 properties totaling 9.6 million square feet from us for an aggregate purchase price of ¥173 billion ($1.9 billion). As a result of this transaction, we recognized a gain of $337.9 million, net of a $59.6 million deferral due to our ongoing investment. The gain was recorded in Gains on Dispositions of Investments in Real Estate and Revaluation of Equity Investments upon Acquisition of a Controlling Interest, Net in the Consolidated Statements of Operations.

Also during the first quarter of 2013, we closed Prologis European Logistics Partners Sàrl (“PELP”), a European joint venture with Norges Bank Investment Management (“NBIM”). The venture acquired a portfolio from us for approximately €2.3 billion ($3.0 billion) consisting of 195 properties and 48.7 million square feet in 11 European target global markets. As a result of this transaction, we recognized a gain of $1.8 million, net of a deferred gain due to our ongoing investment. In connection with the closing, a warrant NBIM received at signing to acquire six million shares of our common stock with a strike price of $35.64 became exercisable. We used a Black-Scholes pricing model to value the warrant and this value was included as consideration in the overall result of the transaction. On December 12, 2014, NBIM exercised the warrant to receive six million shares of our common stock for an aggregate strike price of $213.8 million.

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Lease Commitments

We have entered into operating ground leases as a lessee on certain land parcels, primarily on-tarmac facilities and office space with remaining lease terms of 1 to 75 years. Future minimum rental payments under non-cancelable operating leases in effect at December 31, 2014, were as follows (in thousands):

2015 |  | $ | 32,307 |
2016 |  |  | 30,237 |
2017 |  |  | 27,490 |
2018 |  |  | 25,896 |
2019 |  |  | 25,110 |
Thereafter |  |  | 391,634 |
Total |  | $ | 532,674 |

Operating Lease Agreements

We lease our operating properties and certain land parcels to customers under agreements that are generally classified as operating leases. Our largest customer and 25 largest customers accounted for 1.9% and 19.5%, respectively, of our net effective rent at December 31, 2014. We determine net effective rent at the beginning of a lease based upon total estimated cash to be received through the term of the lease on an annual basis. At December 31, 2014, minimum lease payments on leases with lease periods greater than one year for space in our operating properties and leases of land subject to ground leases were as follows (in thousands):

2015 |  | $ | 1,193,676 |
2016 |  |  | 1,025,162 |
2017 |  |  | 798,922 |
2018 |  |  | 601,492 |
2019 |  |  | 427,600 |
Thereafter |  |  | 1,326,106 |
Total |  | $ | 5,372,958 |

These amounts do not reflect future rental revenues from the renewal or replacement of existing leases and exclude reimbursements of operating expenses.

5. | Unconsolidated Investments

Summary of Investments

We have investments in entities through a variety of ventures. We co-invest in entities that own multiple properties with partners and investors and provide asset and property management services to these entities, which we refer to as co-investment ventures. These entities may be consolidated or unconsolidated, depending on the structure, our partner’s participation and other rights and our level of control of the entity. This note primarily details our investments in unconsolidated co-investment ventures, which are accounted for using the equity method of accounting. See Note 12 for more detail regarding our consolidated investments.

We also have other ventures, generally with one partner and that we do not manage, which we account for on the equity method. We refer to our investments in all entities accounted for under the equity method, both unconsolidated co-investment ventures and other ventures, collectively, as unconsolidated entities.

Our investments in and advances to our unconsolidated entities at December 31 are summarized below (in thousands):

|  | 2014 |  |  | 2013 |
Unconsolidated co-investment ventures |  | $ | 4,665,918 |  |  | $ | 4,250,015 |
Other ventures |  |  | 158,806 |  |  |  | 180,224 |
Totals |  | $ | 4,824,724 |  |  | $ | 4,430,239 |

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Unconsolidated Co-Investment Ventures

The amounts recognized in Strategic Capital Income and Earnings from Unconsolidated Entities, Net in the Consolidated Statements of Operations depend on the size and operations of the co-investment ventures. Our ownership interest in these ventures also impacts the equity in earnings we recognize. The co-investment venture information represents the venture’s information (not our proportionate share) prepared on a GAAP basis. The following tables are summarized information of the unconsolidated co-investment ventures at December 31, and for the three years ended December 31.

(dollars and square feet in millions) |  | 2014 |  |  | 2013 |  |  | 2012 |
Americas: |  |  |  |  |  |  |  |  |  |  |  |
Number of ventures |  |  | 3 |  |  |  | 4 |  |  |  | 6 |
Number of properties owned |  |  | 590 |  |  |  | 709 |  |  |  | 801 |
Square feet |  |  | 87.1 |  |  |  | 108.5 |  |  |  | 127.5 |
Total assets |  | $ | 7,063 |  |  | $ | 8,014 |  |  | $ | 9,070 |
Third-party debt |  | $ | 2,280 |  |  | $ | 2,999 |  |  | $ | 3,836 |
Total liabilities |  | $ | 2,421 |  |  | $ | 3,177 |  |  | $ | 4,170 |
Our investment balance (1) |  | $ | 1,537 |  |  | $ | 1,194 |  |  | $ | 1,112 |
Our weighted average ownership (2) |  |  | 31.0% |  |  |  | 22.7% |  |  |  | 23.2% |
Europe: |  |  |  |  |  |  |  |  |  |  |  |
Number of ventures |  |  | 4 |  |  |  | 4 |  |  |  | 3 |
Number of properties owned |  |  | 636 |  |  |  | 571 |  |  |  | 312 |
Square feet |  |  | 147.4 |  |  |  | 132.9 |  |  |  | 70.3 |
Total assets |  | $ | 11,463 |  |  | $ | 11,819 |  |  | $ | 6,605 |
Third-party debt |  | $ | 2,644 |  |  | $ | 2,998 |  |  | $ | 2,384 |
Total liabilities |  | $ | 3,524 |  |  | $ | 4,114 |  |  | $ | 2,954 |
Our investment balance (1) |  | $ | 2,773 |  |  | $ | 2,703 |  |  | $ | 723 |
Our weighted average ownership (2) |  |  | 38.8% |  |  |  | 39.0% |  |  |  | 29.7% |
Asia: |  |  |  |  |  |  |  |  |  |  |  |
Number of ventures |  |  | 2 |  |  |  | 2 |  |  |  | 2 |
Number of properties owned |  |  | 52 |  |  |  | 43 |  |  |  | 44 |
Square feet |  |  | 26.2 |  |  |  | 22.9 |  |  |  | 11.0 |
Total assets |  | $ | 4,135 |  |  | $ | 4,032 |  |  | $ | 1,937 |
Third-party debt |  | $ | 1,652 |  |  | $ | 1,715 |  |  | $ | 973 |
Total liabilities |  | $ | 1,749 |  |  | $ | 1,899 |  |  | $ | 1,063 |
Our investment balance (1) |  | $ | 356 |  |  | $ | 353 |  |  | $ | 179 |
Our weighted average ownership (2) |  |  | 15.0% |  |  |  | 15.0% |  |  |  | 19.2% |
Total: |  |  |  |  |  |  |  |  |  |  |  |
Number of ventures |  |  | 9 |  |  |  | 10 |  |  |  | 11 |
Number of properties owned |  |  | 1,278 |  |  |  | 1,323 |  |  |  | 1,157 |
Square feet |  |  | 260.7 |  |  |  | 264.3 |  |  |  | 208.8 |
Total assets |  | $ | 22,661 |  |  | $ | 23,865 |  |  | $ | 17,612 |
Third-party debt |  | $ | 6,576 |  |  | $ | 7,712 |  |  | $ | 7,193 |
Total liabilities |  | $ | 7,694 |  |  | $ | 9,190 |  |  | $ | 8,187 |
Our investment balance (1) |  | $ | 4,666 |  |  | $ | 4,250 |  |  | $ | 2,014 |
Our weighted average ownership (2) |  |  | 32.0% |  |  |  | 29.2% |  |  |  | 25.1% |

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(in millions) |  | 2014 (3) |  |  | 2013 (3) |  |  | 2012 |
Americas: |  |  |  |  |  |  |  |  |  |  |  |
Revenues |  | $ | 711 |  |  | $ | 702 |  |  | $ | 759 |
Net operating income |  | $ | 527 |  |  | $ | 513 |  |  | $ | 561 |
Net earnings (loss) |  | $ | 54 |  |  | $ | 58 |  |  | $ | (88) |
Europe: |  |  |  |  |  |  |  |  |  |  |  |
Revenues |  | $ | 1,001 |  |  | $ | 801 |  |  | $ | 490 |
Net operating income |  | $ | 787 |  |  | $ | 621 |  |  | $ | 380 |
Net earnings |  | $ | 268 |  |  | $ | 131 |  |  | $ | 86 |
Asia: |  |  |  |  |  |  |  |  |  |  |  |
Revenues |  | $ | 280 |  |  | $ | 224 |  |  | $ | 141 |
Net operating income |  | $ | 219 |  |  | $ | 175 |  |  | $ | 109 |
Net earnings |  | $ | 86 |  |  | $ | 48 |  |  | $ | 8 |
Total: |  |  |  |  |  |  |  |  |  |  |  |
Revenues |  | $ | 1,992 |  |  | $ | 1,727 |  |  | $ | 1,390 |
Net operating income |  | $ | 1,533 |  |  | $ | 1,309 |  |  | $ | 1,050 |
Net earnings |  | $ | 408 |  |  | $ | 237 |  |  | $ | 6 |

(1) | The difference between our ownership interest of the venture’s equity and our investment balance results principally from three types of transactions: (i) deferring a portion of the gains we recognize from a contribution of a property to the venture ($322.9 million, $139.6 million and $147.9 million at December 31, 2014, 2013 and 2012, respectively); (ii) recording additional costs associated with our investment in the venture; and (iii) advances to the venture.

(2) | Represents our weighted average ownership interest in all co-investment ventures based on each entity’s contribution to total assets, before depreciation, net of other liabilities.

(3) | We had significant activity with our unconsolidated co-investment ventures in 2014 and 2013. As described above, we formed and invested in FIBRA Prologis in June 2014. In connection with this transaction, we concluded our unconsolidated co-investment venture in Mexico. During 2013, we concluded three co-investment ventures and we started two new co-investment ventures.

Summarized information regarding the amounts we recognized in the Consolidated Statements of Operations as our share of the earnings from our investments in unconsolidated co-investment ventures for the years ended December 31 was as follows (in thousands):

|  | 2014 |  |  | 2013 |  |  | 2012 |
Earnings (loss) from unconsolidated co-investment ventures: |  |  |  |  |  |  |  |  |  |  |  |
Americas |  | $ | 8,596 |  |  | $ | 21,724 |  |  | $ | (7,843) |
Europe |  |  | 108,430 |  |  |  | 63,839 |  |  |  | 31,174 |
Asia |  |  | 14,022 |  |  |  | 9,091 |  |  |  | 2,372 |
Total earnings from unconsolidated co-investment ventures, net |  | $ | 131,048 |  |  | $ | 94,654 |  |  | $ | 25,703 |
Strategic capital and other income: |  |  |  |  |  |  |  |  |  |  |  |
Americas |  | $ | 94,354 |  |  | $ | 70,642 |  |  | $ | 68,142 |
Europe |  |  | 86,487 |  |  |  | 63,794 |  |  |  | 37,173 |
Asia |  |  | 37,509 |  |  |  | 42,749 |  |  |  | 19,870 |
Total strategic capital income |  |  | 218,350 |  |  |  | 177,185 |  |  |  | 125,185 |
Development management and other income |  |  | 5,424 |  |  |  | 4,007 |  |  |  | 535 |
Total strategic capital and other income |  | $ | 223,774 |  |  | $ | 181,192 |  |  | $ | 125,720 |

We may earn promotes based on the third-party investor returns over time. In June 2014, we earned a promote of $42.1 million from Prologis Targeted U.S. Logistics Fund, which was based on the venture’s cumulative returns to the investors over the last three years. In October 2013, we earned a promote of $7.9 million in connection with the conclusion of SGP Mexico, which was based on the venture’s cumulative returns to the investor over the life of the venture. We recognized the third-party investors’ portion of the promote of $31.3 million and $6.4 million

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in 2014 and 2013, respectively, which is reflected in Strategic Capital Income in the Consolidated Statements of Operations. We also recognized $4.2 million and $1.3 million of expense in 2014 and 2013, respectively that is reflected in Strategic Capital Expenses in the Consolidated Statements of Operations, and represents the associated cash bonus paid pursuant to the terms of the Prologis Promote Plan. See Note 13 for more information about this plan.

Information about our investments in the individual co-investment ventures at December 31 was as follows (dollars in thousands):

|  | Ownership Percentage |  |  | Investment in and Advances to |
Co-Investment Venture |  | 2014 |  |  | 2013 |  |  | 2014 |  |  | 2013 |
Prologis Targeted U.S. Logistics Fund, L.P. |  |  | 24.3% |  |  |  | 25.9% |  |  | $ | 712,044 |  |  | $ | 743,454 |
Prologis North American Industrial Fund, LP (NAIF) (1) |  |  | - |  |  |  | 23.1% |  |  |  | - |  |  |  | 201,482 |
FIBRA Prologis (2) (3) |  |  | 45.9% |  |  |  | - |  |  |  | 589,627 |  |  |  | - |
Prologis MX Fund LP (Prologis Mexico Industrial Fund) (2) |  |  | - |  |  |  | 20.0% |  |  |  | - |  |  |  | 49,684 |
Prologis Brazil Logistics Partners Fund I, L.P. (“Brazil Fund”) and related joint ventures (“Brazil Ventures”) (4) |  |  | 50.0% |  |  |  | 50.0% |  |  |  | 235,496 |  |  |  | 199,392 |
Prologis Targeted Europe Logistics Fund, FCP-FIS |  |  | 43.2% |  |  |  | 43.1% |  |  |  | 458,702 |  |  |  | 471,896 |
Prologis European Properties Fund II, FCP-FIS |  |  | 31.1% |  |  |  | 32.5% |  |  |  | 488,503 |  |  |  | 582,828 |
Europe Logistics Venture 1, FCP-FIS (5) |  |  | 15.0% |  |  |  | 15.0% |  |  |  | 56,127 |  |  |  | 62,654 |
Prologis European Logistics Partners Sàrl (PELP) (5) |  |  | 50.0% |  |  |  | 50.0% |  |  |  | 1,769,720 |  |  |  | 1,585,923 |
Nippon Prologis REIT (NPR) (6)(7) |  |  | 15.1% |  |  |  | 15.1% |  |  |  | 303,178 |  |  |  | 309,715 |
Prologis China Logistics Venture I, LP & II, LP (Prologis China Logistics Venture) (5) |  |  | 15.0% |  |  |  | 15.0% |  |  |  | 52,521 |  |  |  | 42,987 |
Totals |  |  |  |  |  |  |  |  |  | $ | 4,665,918 |  |  | $ | 4,250,015 |

(1) | As discussed in Note 3, we began consolidating NAIF in October 2014.

(2) | As discussed in Note 4, we completed the initial public offering of FIBRA Prologis in June 2014 and concluded the Prologis Mexico Industrial Fund. At December 31, 2014, we owned 291.1 million units of FIBRA Prologis, which had a closing price of Ps 27.29 ($1.86) per unit on the Mexican Stock Exchange.

(3) | We have granted FIBRA Prologis a right of first refusal with respect to stabilized properties that we plan to sell in Mexico.

(4) | We have a 50% ownership interest in and consolidate an entity that in turn owns 50% of several entities that we account for on the equity method. Also, we have additional investments in other unconsolidated entities in Brazil that we account for on the equity method with various ownership interests ranging from 5-50%. We refer to the Brazil Fund and the other unconsolidated entities collectively as the “Brazil Ventures.”

(5) | We have one partner in each of these co-investment ventures.

(6) | At December 31, 2014, we owned 261,310 units of NPR, which had a closing price of ¥260,600 ($2,179) per share on the Tokyo Stock Exchange. At December 31, 2014 and 2013, we had receivables from NPR of $85.9 million and $88.5 million, respectively, related to customer security deposits that originated through a leasing company owned by us that pertain to properties owned by NPR. We have a corresponding payable to NPR’s customers in Other Liabilities in the Consolidated Balance Sheets.

(7) | For any properties we develop and plan to sell in Japan, we are committed to offer those properties to NPR.

Equity Commitments Related to Certain Unconsolidated Co-Investment Ventures

Certain co-investment ventures have equity commitments from us and our venture partners. Our venture partners fulfill their equity commitment with cash. We may fulfill our equity commitment through contributions of properties or cash. The venture may obtain financing for the properties and therefore the acquisition price of additional investments that the venture could make may be more than the equity commitment. Depending on market conditions, the investment objectives of the ventures, our liquidity needs and other factors, we may make additional contributions of properties and/or additional cash investments in these ventures through the remaining commitment period.

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The following table is a summary of remaining equity commitments at December 31, 2014 (in millions):

|  | Equity commitments |  |  | Expiration date for remaining commitments |
|  | Prologis |  |  | Venture Partners |  |  | Total |  |
Prologis Targeted U.S. Logistics Fund |  | $ | - |  |  | $ | 376 |  |  | $ | 376 |  |  |  | 2015-2017 |
Prologis Targeted Europe Logistics Fund (1) |  |  | 117 |  |  |  | 197 |  |  |  | 314 |  |  |  | June 2015 |
Prologis European Properties Fund II (1) |  |  | 46 |  |  |  | 106 |  |  |  | 152 |  |  |  | September 2015 |
Europe Logistics Venture 1 (1) |  |  | 4 |  |  |  | 21 |  |  |  | 25 |  |  |  | June 2015 |
Prologis European Logistics Partners Sàrl (2) |  |  | 104 |  |  |  | 104 |  |  |  | 208 |  |  |  | February 2016 |
Prologis China Logistics Venture (3) |  |  | 225 |  |  |  | 1,277 |  |  |  | 1,502 |  |  |  | 2015 and 2017 |
Total |  | $ | 496 |  |  | $ | 2,081 |  |  | $ | 2,577 |  |  |  |  |

(1) | Equity commitments are denominated in euro and reported above in U.S. dollars based on an exchange rate of 1.21 U.S. dollars to the euro.

(2) | The equity commitments for this venture are expected to fund the future repayment of debt that is denominated in British pounds sterling. The commitments will be called in euros and are reported above in U.S. dollars using an exchange rate of 1.56 U.S. dollars to the British pounds sterling.

(3) | In July 2014, we secured a $500 million increase in committed third-party equity for this venture.

Other Ventures

We have several investments in other unconsolidated ventures that own real estate properties and/or perform development activity. We recognized our proportionate share of the earnings from our investments in these entities of $3.2 million, $2.6 million and $6.0 million for the years ended December 31, 2014, 2013 and 2012, respectively.

6. | Notes Receivable Backed by Real Estate

At December 31, 2013, we had $188.0 million of notes backed by real estate that represented an investment in a preferred equity interest made in 2010 through the sale of a portfolio of industrial properties. We earned a preferred return at an annual rate of 7% for the first three years and 8% for the fourth year. In the second quarter of 2014, the notes and all accrued interest were paid in full.

7. | Other Assets and Other Liabilities

Our other assets consisted of the following, net of amortization and depreciation, if applicable, at December 31 (in thousands):

|  | 2014 |  |  | 2013 |
Leasing commissions |  | $ | 241,557 |  |  | $ | 222,267 |
Rent leveling and above market leases |  |  | 224,589 |  |  |  | 256,018 |
Derivative assets |  |  | 106,664 |  |  |  | 20,241 |
Prepaid assets |  |  | 105,093 |  |  |  | 136,729 |
Fixed assets |  |  | 86,927 |  |  |  | 85,389 |
Value added taxes receivable |  |  | 86,331 |  |  |  | 106,074 |
Loan fees |  |  | 53,025 |  |  |  | 49,920 |
Management contracts |  |  | 52,896 |  |  |  | 61,082 |
Other notes receivable |  |  | 46,570 |  |  |  | 38,860 |
Deferred income taxes |  |  | 7,887 |  |  |  | 19,020 |
Other |  |  | 84,525 |  |  |  | 99,863 |
Totals |  | $ | 1,096,064 |  |  | $ | 1,095,463 |

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

Our other liabilities consisted of the following, net of amortization, if applicable, at December 31 (in thousands):

|  | 2014 |  |  | 2013 |
Tenant security deposits |  | $ | 169,326 |  |  | $ | 191,070 |
Income tax liabilities |  |  | 85,200 |  |  |  | 184,888 |
Unearned rents |  |  | 74,873 |  |  |  | 64,156 |
Derivative liabilities |  |  | 52,740 |  |  |  | 77,018 |
Below market leases |  |  | 30,651 |  |  |  | 30,031 |
Deferred income |  |  | 16,326 |  |  |  | 39,565 |
Value added taxes payable |  |  | 13,358 |  |  |  | 57,260 |
Environmental |  |  | 10,878 |  |  |  | 16,926 |
Other |  |  | 173,074 |  |  |  | 159,731 |
Totals |  | $ | 626,426 |  |  | $ | 820,645 |

The expected future amortization of leasing commissions into rental expense of $241.6 million is summarized in the table below. We also expect our above and below market leases and rent leveling net assets, which total $193.9 million at December 31, 2014, to be amortized into rental income as follows (in thousands):

|  | Amortization Expense |  |  | Net Charge to Rental Income |
2015 |  | $ | 69,815 |  |  | $ | 10,678 |
2016 |  |  | 55,330 |  |  |  | 22,322 |
2017 |  |  | 41,783 |  |  |  | 25,152 |
2018 |  |  | 25,342 |  |  |  | 23,843 |
2019 |  |  | 15,531 |  |  |  | 20,413 |
Thereafter |  |  | 33,756 |  |  |  | 91,530 |
Totals |  | $ | 241,557 |  |  | $ | 193,938 |

8. | Assets Held for Sale and Discontinued Operations

We had seven operating properties that met the criteria to be classified as held for sale at December 31, 2014, and three land parcels that met the criteria at December 31, 2013. The amounts included in held for sale at December 31, 2014 and 2013, respectively, represented the real estate investment balances and the related assets and liabilities for each property.

As discussed in Note 1, the FASB issued a standard updating the accounting and disclosure regarding discontinued operations in April 2014 which we adopted as of January 1, 2014. None of our property dispositions in 2014 met the new criteria to be classified as discontinued operations. The operations of the properties that were disposed of to third parties during 2013 and 2012 that met the criteria for discontinued operations, including the aggregate net gains or losses recognized upon their disposition (See Note 4 for more detail on gains on dispositions), are presented as discontinued operations in the Consolidated Statements of Operations. Income attributable to disposed properties and assets held for sale was as follows for the years ended December 31 (in thousands):

|  | 2013 |  |  | 2012 |
Rental income and recoveries |  | $ | 34,105 |  |  | $ | 128,162 |
Rental expenses |  |  | (10,633) |  |  |  | (40,925) |
Depreciation and amortization |  |  | (15,339) |  |  |  | (43,197) |
Interest expense |  |  | (1,163) |  |  |  | (3,213) |
Income attributable to disposed properties |  | $ | 6,970 |  |  | $ | 40,827 |

9. | Debt

All debt is incurred directly or indirectly by the Operating Partnership. The Parent does not have any indebtedness, but guarantees the unsecured debt of the Operating Partnership. We generally do not guarantee the debt issued by non-wholly-owned subsidiaries.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

Our debt consisted of the following at December 31 (dollars in thousands):

|  | 2014 |  |  | 2013 |
|  | Weighted Average Interest Rate (1) |  |  | Amount Outstanding (2) |  |  | Weighted Average Interest Rate (1) |  |  | Amount Outstanding |
Credit facilities |  |  | - % |  |  | $ | - |  |  |  | 1.2% |  |  | $ | 725,483 |
Senior notes (3) |  |  | 3.6% |  |  |  | 6,076,920 |  |  |  | 4.5% |  |  |  | 5,357,933 |
Exchangeable senior notes |  |  | 3.3% |  |  |  | 456,766 |  |  |  | 3.3% |  |  |  | 438,481 |
Secured mortgage debt (4) |  |  | 6.1% |  |  |  | 1,050,591 |  |  |  | 5.6% |  |  |  | 1,696,597 |
Secured mortgage debt of consolidated entities (5) |  |  | 2.5% |  |  |  | 1,207,106 |  |  |  | 4.7% |  |  |  | 239,992 |
Term loans |  |  | 1.3% |  |  |  | 572,730 |  |  |  | 1.7% |  |  |  | 535,908 |
Other debt (6) |  |  | 6.2% |  |  |  | 16,086 |  |  |  | 6.2% |  |  |  | 16,822 |
Totals |  |  | 3.6% |  |  | $ | 9,380,199 |  |  |  | 4.2% |  |  | $ | 9,011,216 |

(1) | The interest rates presented represent the effective interest rates (including amortization of the non-cash premiums or discount).

(2) | Included in the outstanding balances are borrowings denominated in non-U.S. currency, principally: euro ($3.3 billion) and Japanese yen ($0.4 billion).

(3) | Notes are due July 2017 to June 2026 and effective interest rates range from 1.4% to 7.6% at December 31, 2014.

(4) | Debt is due July 2015 to April 2025 and effective interest rates range from 3.3% to 7.6% at December 31, 2014. The debt is secured by 196 real estate properties with an aggregate undepreciated cost of $2.6 billion at December 31, 2014.

(5) | Debt is due July 2015 to December 2027 and effective interest rates range from 1.9% to 6.9% at December 31, 2014. The debt is secured by 171 real estate properties with an aggregate undepreciated cost of $2.0 billion at December 31, 2014.

(6) | The balance at December 31, 2014, represents primarily assessment bonds with varying interest rates from 4.5% to 7.9% that are due December 2015 to September 2033. The assessment bonds are issued by municipalities and guaranteed by us as a means of financing infrastructure and secured by assessments (similar to property taxes) on various underlying real estate properties with an aggregate undepreciated cost of $784.2 million at December 31, 2014.

Credit Facilities

We have a global senior credit facility (the “Global Facility”), under which we may draw in U.S. dollars, euro, Japanese yen, British pounds sterling and Canadian dollars on a revolving basis. In June 2014, the Global Facility was amended to increase the availability to $2.5 billion (subject to currency fluctuations, approximately $2.4 billion at December 31, 2014). The Global Facility is scheduled to mature on July 11, 2017; however, we may extend the maturity date twice, by six months each, subject to satisfaction of certain conditions and payment of extension fees. Pricing under the Global Facility, including the spread over LIBOR, facility fees and letter of credit fees, varies based upon the public debt ratings of the Operating Partnership. The Global Facility contains customary representations, covenants and defaults (including a cross-acceleration to other recourse indebtedness of more than $50 million).

We also have a ¥45 billion ($376.2 million at December 31, 2014) Japanese yen revolver (the “Revolver”) with the ability to increase to ¥56.5 billion ($472.3 million at December 31, 2014) subject to obtaining additional lender commitments. Pricing under the Revolver was consistent with the Global Facility at December 31, 2014. The Revolver contains certain customary representations, covenants and defaults that are substantially the same as the corresponding provisions of the Global Facility.

We refer to the Global Facility and the Revolver, collectively, as our “Credit Facilities.”

In the first quarter of 2013, we entered into a $500 million bridge loan under which we could borrow in U.S. dollar, euro, or yen. We borrowed ¥20 billion ($215.7 million) under the bridge loan to make our initial investment in our co-investment venture in Japan. In connection with the contribution of properties to this venture, we paid the borrowings outstanding on this bridge loan and terminated the facility.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

Information about our Credit Facilities at December 31 was as follows (in millions):

|  | 2014 |  |  | 2013 |  |  | 2012 |
For the years ended December 31: |  |  |  |  |  |  |  |  |  |  |  |
Weighted average daily interest rate |  |  | 1.1 % |  |  |  | 1.7 % |  |  |  | 1.6 % |
Weighted average daily borrowings |  | $ | 182 |  |  | $ | 789 |  |  | $ | 815 |
Maximum borrowings outstanding at any month-end |  | $ | 742 |  |  | $ | 1,325 |  |  | $ | 1,634 |
At December 31: |  |  |  |  |  |  |  |  |  |  |  |
Aggregate lender - commitments |  | $ | 2,742 |  |  | $ | 2,451 |  |  | $ | 2,118 |
Less: |  |  |  |  |  |  |  |  |  |  |  |
Borrowings outstanding |  |  | - |  |  |  | 726 |  |  |  | 889 |
Outstanding letters of credit |  |  | 35 |  |  |  | 73 |  |  |  | 68 |
Current availability |  | $ | 2,707 |  |  | $ | 1,652 |  |  | $ | 1,161 |

Senior Notes

The senior unsecured notes are issued by the Operating Partnership and guaranteed by the Parent. Our obligations under the senior notes are effectively subordinated in certain respects to any of our debt that is secured by a lien on real property, to the extent of the value of such real property. The senior notes require interest payments be made quarterly, semi-annually or annually. All of the senior notes are redeemable at any time at our option, subject to certain prepayment penalties. Such redemption and other terms are governed by the provisions of indenture agreements, various note purchase agreements and/or trust deeds.

During the years ended December 31, we issued the following senior notes (dollars and euros in thousands):

2014 |  | Principal Amount |  |  | Interest Rate |  |  | Effective Interest Rate |  |  | Maturity Date |
February 2014 (1) |  | € | 700,000 |  |  | $ | 959,420 |  |  |  | 3.375% |  |  |  | 3.52% |  |  |  | February 2024 |
June 2014 (1) |  | € | 500,000 |  |  | $ | 680,550 |  |  |  | 3.000% |  |  |  | 3.10% |  |  |  | June 2026 |
October 2014 (1) |  | € | 600,000 |  |  | $ | 756,420 |  |  |  | 1.375% |  |  |  | 1.40% |  |  |  | October 2020 |

2013 |  | Principal Amount |  |  | Interest Rate |  |  | Effective Interest Rate |  |  | Maturity Date |
August 2013 |  |  |  |  |  | $ | 400,000 |  |  |  | 2.750% |  |  |  | 2.76% |  |  |  | February 2019 |
August 2013 |  |  |  |  |  | $ | 850,000 |  |  |  | 4.250% |  |  |  | 4.28% |  |  |  | August 2023 |
November 2013 |  |  |  |  |  | $ | 500,000 |  |  |  | 3.350% |  |  |  | 3.35% |  |  |  | February 2021 |
December 2013 (1) |  | € | 700,000 |  |  | $ | 950,500 |  |  |  | 3.000% |  |  |  | 3.08% |  |  |  | January 2022 |

(1) | This debt is denominated in euro and the exchange rate used to calculate into U.S. dollar was the effective rate at the date of the transaction.

Exchangeable Senior Notes

At December 31, 2014, we had $460.0 million of 3.25% exchangeable senior notes that mature on March 15, 2015 (“Exchangeable Notes”). The Exchangeable Notes are exchangeable at any time by holders at an initial conversion rate of 25.8244 shares of our common stock per $1,000 principal amount of notes, equivalent to an initial conversion price of approximately $38.72 per share, subject to adjustment upon the occurrence of certain events. The holders of the notes have the right to require us to repurchase their notes for cash at any time on or prior to the maturity date upon a change in control or a termination of trading. Based on the conversion rate at December 31, 2014, 11.9 million shares would be required to settle the principal amount in stock for the Exchangeable Notes. The conversion of the Exchangeable Notes into stock, and the corresponding adjustment to interest expense, are included in our computation of diluted earnings per share/unit, unless the impact is anti-dilutive. For the years ended December 31, 2014, 2013 and 2012, the impact of these notes was anti-dilutive.

We recognized unrealized losses on the derivative instrument (exchange feature) associated with exchangeable debt of $10.3 million, $1.2 million and $22.3 million for the years ended December 31, 2014, 2013 and 2012, respectively. The fair value of the derivative associated with the Exchangeable Notes was a liability of $51.3 million and $41.0 million at December 31, 2014 and 2013, respectively.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

Secured Mortgage Debt and Secured Mortgage Debt of Consolidated Entities

TMK bonds are a financing vehicle in Japan for special purposes companies known as TMKs. In 2013, we issued ¥10.6 billion ($106.4 million) of new TMK bonds and paid off or transferred substantially all of our outstanding TMK bonds. At December 31, 2013, we had one TMK bond outstanding for ¥1.5 billion ($14.3 million). In 2014, we issued ¥7.2 billion ($70.7 million) of new TMK bonds and paid off or transferred all of our outstanding TMK bonds.

In connection with the acquisitions of a controlling interest in certain of our co-investment ventures in 2014 and 2013, we assumed secured mortgage debt of $1.2 billion and $190.4 million, respectively. See Note 3 for more information on these transactions.

Term Loans

In June 2014, we terminated our existing senior term loan agreement and entered into a new agreement (the “Euro Term Loan”) under which loans can be obtained in U.S. dollars, euro, Japanese yen, and British pounds sterling in an aggregate amount not to exceed €500 million ($607.1 million at December 31, 2014). We may pay down and re-borrow under the Euro Term Loan and increase the borrowings up to €1.0 billion ($1.2 billion at December 31, 2014), subject to obtaining additional lender commitments. The interest rate on the Euro Term Loan is LIBOR plus 98 basis points and the loan is scheduled to mature in June 2017; however, we may extend the maturity date twice, by one year each, subject to the satisfaction of certain conditions and payment of an extension fee. The Euro Term Loan has borrowings of €190 million ($230.7 million) at December 31, 2014.

In May 2014, we entered into a Japanese yen term loan (“Yen Term Loan”), under which we may obtain loans in an aggregate amount not to exceed ¥40.9 billion ($342.1 million at December 31, 2014). We may increase the borrowings to ¥51.1 billion ($427.2 million at December 31, 2014), subject to obtaining additional lender commitments. The Yen Term Loan is scheduled to mature in 2021, and the interest rate is yen LIBOR plus 120 basis points. The Yen Term Loan was fully drawn at December 31, 2014.

Debt Covenants

We have approximately $6.5 billion of senior notes outstanding at December 31, 2014 that were issued under three separate indentures, as supplemented, and are subject to certain financial covenants. We are also subject to financial covenants under our Credit Facilities and certain secured mortgage debt. At December 31, 2014, we were in compliance with all of our debt covenants.

Long-Term Debt Maturities

Principal payments due on our debt, for each year through the period ending December 31, 2024, and thereafter were as follows at December 31, 2014 (in millions):

|  | Prologis |  |  |  |  |  |  |
|  | Unsecured |  |  |  |  |  |  |  |  |  |  |  |  |
Maturity |  | Senior Notes |  |  | Exchangeable Notes |  |  | Credit Facilities |  |  | Term Loans and Other Debt |  |  | Secured Mortgage Debt |  |  | Total |  |  | Consolidated Entities’ Debt |  |  | Total Consolidated Debt |
2015(1) |  | $ | - |  |  | $ | 460 |  |  | $ | - |  |  | $ | 1 |  |  | $ | 24 |  |  | $ | 485 |  |  | $ | 114 |  |  | $ | 599 |
2016 |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 1 |  |  |  | 294 |  |  |  | 295 |  |  |  | 446 |  |  |  | 741 |
2017 |  |  | 377 |  |  |  | - |  |  |  | - |  |  |  | 232 |  |  |  | 156 |  |  |  | 765 |  |  |  | 206 |  |  |  | 971 |
2018 |  |  | 262 |  |  |  | - |  |  |  | - |  |  |  | 1 |  |  |  | 111 |  |  |  | 374 |  |  |  | 166 |  |  |  | 540 |
2019 |  |  | 693 |  |  |  | - |  |  |  | - |  |  |  | 1 |  |  |  | 285 |  |  |  | 979 |  |  |  | 1 |  |  |  | 980 |
2020 |  |  | 1,096 |  |  |  | - |  |  |  | - |  |  |  | 1 |  |  |  | 6 |  |  |  | 1,103 |  |  |  | 189 |  |  |  | 1,292 |
2021 |  |  | 500 |  |  |  | - |  |  |  | - |  |  |  | 342 |  |  |  | 11 |  |  |  | 853 |  |  |  | 1 |  |  |  | 854 |
2022 |  |  | 850 |  |  |  | - |  |  |  | - |  |  |  | 1 |  |  |  | 7 |  |  |  | 858 |  |  |  | 1 |  |  |  | 859 |
2023 |  |  | 850 |  |  |  | - |  |  |  | - |  |  |  | 1 |  |  |  | 7 |  |  |  | 858 |  |  |  | 1 |  |  |  | 859 |
2024 |  |  | 850 |  |  |  | - |  |  |  | - |  |  |  | 1 |  |  |  | 129 |  |  |  | 980 |  |  |  | 1 |  |  |  | 981 |
Thereafter |  |  | 607 |  |  |  | - |  |  |  | - |  |  |  | 7 |  |  |  | - |  |  |  | 614 |  |  |  | 3 |  |  |  | 617 |
Subtotal |  |  | 6,085 |  |  |  | 460 |  |  |  | - |  |  |  | 589 |  |  |  | 1,030 |  |  |  | 8,164 |  |  |  | 1,129 |  |  |  | 9,293 |
Unamortized (discounts) premiums, net |  |  | (8) |  |  |  | (3) |  |  |  | - |  |  |  | - |  |  |  | 20 |  |  |  | 9 |  |  |  | 78 |  |  |  | 87 |
Total |  | $ | 6,077 |  |  | $ | 457 |  |  | $ | - |  |  | $ | 589 |  |  | $ | 1,050 |  |  | $ | 8,173 |  |  | $ | 1,207 |  |  | $ | 9,380 |

(1) | The Exchangeable Notes are due on March 15, 2015. We will settle the exchanges in all cash, all stock or a combination of both pursuant to the applicable indenture.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

Interest Expense

Interest expense from continuing operations included the following components for the years ended December 31 (in thousands):

|  | 2014 |  |  | 2013 |  |  | 2012 |
Gross interest expense |  | $ | 377,666 |  |  | $ | 471,923 |  |  | $ | 578,518 |
Amortization of premium, net |  |  | (21,440) |  |  |  | (39,015) |  |  |  | (36,687) |
Amortization of deferred loan costs |  |  | 14,116 |  |  |  | 14,374 |  |  |  | 16,781 |
Interest expense before capitalization |  |  | 370,342 |  |  |  | 447,282 |  |  |  | 558,612 |
Capitalized amounts |  |  | (61,457) |  |  |  | (67,955) |  |  |  | (53,397) |
Net interest expense |  | $ | 308,885 |  |  | $ | 379,327 |  |  | $ | 505,215 |
Total cash paid for interest, net of amounts capitalized |  | $ | 258,441 |  |  | $ | 426,528 |  |  | $ | 546,627 |

Early Extinguishment of Debt

In an effort to reduce our borrowing costs and extend our debt maturities, we repurchased certain debt, principally outstanding senior notes and secured mortgage debt, generally with proceeds from the issuance of senior notes outlined above and an equity offering in April 2013 (as described in Note 10). As a result, we may recognize a gain or loss represented by the difference between the recorded debt (net of premiums and discounts and including related debt costs) and the consideration we paid to retire the debt, including fees.

A summary of the activity related to the repurchase of debt and net loss on early extinguishment of debt is as follows (in millions):

|  | 2014 |  |  | 2013 |
Repurchase of senior notes |  | $ | 1,290 |  |  | $ | 2,142 |
Repurchase of secured mortgage debt |  | $ | 528 |  |  | $ | 1,571 |
Loss on early extinguishment of debt |  | $ | 165 |  |  | $ | 277 |

The repurchase of debt activity was not considered significant during 2012.

10. | Stockholders’ Equity of Prologis, Inc.

Shares Authorized

At December 31, 2014, 1.1 billion shares were authorized to be issued by the Parent, of which 1.0 billion shares represent common stock. The Board may, without stockholder approval, classify or reclassify any unissued shares of our stock from time to time by setting or changing the preferences, conversion or other rights, voting powers, restrictions, limitations as to distributions, qualifications and terms or conditions of redemption of such shares.

Common Stock

As discussed in Note 4, NBIM exercised a warrant and paid $213.8 million in exchange for six million shares of common stock.

In the fourth quarter of 2014, we issued 3.3 million shares of common stock under our at-the-market program, which generated $140.1 million in net proceeds. We had an equity distribution agreement that allowed us to sell up to $750 million aggregate gross sales proceeds of shares of common stock in this program, through two designated agents, who earn a fee of up to 2% of the gross proceeds, as agreed to on a transaction-by-transaction basis. On February 5, 2015, we entered into a new equity distribution agreement that replaced and superseded the previous agreement. The new agreement allows us to sell up to $750 million aggregate gross sales proceeds of shares of common stock in this program, through six designated agents, who earn a fee of up to 2% of the gross proceeds, as agreed to on a transaction-by-transaction basis.

On April 30, 2013, we completed a public offering of 35.65 million shares of common stock at a price of $41.60 per share, generating approximately $1.4 billion in net proceeds.

Under the 2012 Long-Term Incentive Plan (the “LTIP”), certain of our employees and outside directors are able to participate in equity-based compensation plans. Under this plan, we received gross proceeds for the issuance of common stock of $25.8 million, $22.4 million and $31.0 million, for the years ended December 31, 2014, 2013 and 2012, respectfully. See Note 13 for additional information on this plan.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

Preferred Stock

At December 31, 2014 and 2013, we had one series of preferred stock outstanding, the series Q preferred stock, with a liquidation preference of $50 per share, a par value of $0.01 and a dividend rate of 8.54%, which will be redeemable at our option on or after November 13, 2026. Holders have, subject to certain conditions, limited voting rights and all holders are entitled to receive cumulative preferential dividends based upon liquidation preference. The dividends are payable quarterly in arrears on the last day of each quarter-end. Dividends are payable when, and if, they have been declared by the Board, out of funds legally available for the payment of dividends.

During the second quarter of 2014, we repurchased approximately 435 thousand shares of Series Q preferred stock and recognized a loss on preferred stock redemption of $6.5 million, which primarily represented the difference between the repurchase price and the carrying value of the preferred stock net of original issuance costs. In the second quarter of 2013, we redeemed all of the outstanding series L, M, O, P, R and S preferred stock and recognized a loss of $9.1 million in the first quarter of 2013, when we notified the holders of our intent to redeem these series of preferred stock.

Ownership Restrictions

For us to qualify as a REIT, five or fewer individuals may not own more than 50% of the value of our outstanding stock at any time during the last half of our taxable year. Therefore, our charter restricts beneficial ownership (or ownership generally attributed to a person under the REIT tax rules, by a person, or persons acting as a group, of issued and outstanding common and preferred stock that would cause that person to own or be deemed to own more than 9.8% (by value or number of shares, whichever is more restrictive) of our issued and outstanding capital stock. Further, subject to certain exceptions, no person shall at any time directly or indirectly acquire ownership of more than 25% of any of the preferred stock. These provisions assist us in protecting and preserving our REIT status and protect the interests of stockholders in takeover transactions by preventing the acquisition of a substantial block of outstanding shares of stock.

Shares of stock owned by a person or group of persons in excess of these limits are subject to redemption by us. The provision does not apply where a majority of the Board, in its sole and absolute discretion, waives such limit after determining that our status as a REIT for federal income tax purposes will not be jeopardized or the disqualification of our REIT status is advantageous to our stockholders.

Dividends

In order to comply with the REIT requirements of the Internal Revenue Code, we are generally required to make common and preferred stock dividends (other than capital gain distributions) to our stockholders in amounts that together at least equal (i) the sum of (a) 90% of our “REIT taxable income” computed without regard to the dividends paid deduction and net capital gains and (b) 90% of the net income (after tax), if any, from foreclosure property, minus (ii) certain excess non-cash income. Our common stock distribution policy is to distribute a percentage of our cash flow that ensures that we will meet the distribution requirements of the Internal Revenue Code and that allows us to also retain cash to meet other needs, such as capital improvements and other investment activities.

Our tax return for the year ended December 31, 2014 has not been filed. The taxability information presented for our dividends paid in 2014 is based upon management’s estimate. Our tax returns for open tax years have not been examined by the Internal Revenue Service, other than those discussed in Note 15. Consequently, the taxability of dividends is subject to change.

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In 2014, 2013 and 2012, we paid all of our dividends in cash. The following summarizes the taxability of our common and preferred stock dividends for the years ended December 31:

|  | 2014 (1)(2) |  |  | 2013 |  |  | 2012 |
Common Stock: |  |  |  |  |  |  |  |  |  |  |  |
Ordinary income |  | $ | 0.29 |  |  | $ | - |  |  | $ | 0.38 |
Qualified dividend |  |  | 0.41 |  |  |  | - |  |  |  | 0.20 |
Capital gains |  |  | 0.62 |  |  |  | 1.12 |  |  |  | 0.54 |
Total distribution |  | $ | 1.32 |  |  | $ | 1.12 |  |  | $ | 1.12 |
Preferred Stock - Series L (3): |  |  |  |  |  |  |  |  |  |  |  |
Ordinary income |  | $ | - - |  |  | $ | - |  |  | $ | 0.55 |
Qualified dividend |  |  | - - |  |  |  | - |  |  |  | 0.28 |
Capital gains |  |  | - - |  |  |  | 0.41 |  |  |  | 0.80 |
Total dividend |  | $ | - - |  |  | $ | 0.41 |  |  | $ | 1.63 |
Preferred Stock - Series M, R and S (3): |  |  |  |  |  |  |  |  |  |  |  |
Ordinary income |  | $ | - - |  |  | $ | - |  |  | $ | 0.57 |
Qualified dividend |  |  | - - |  |  |  | - |  |  |  | 0.30 |
Capital gains |  |  | - - |  |  |  | 0.42 |  |  |  | 0.82 |
Total dividend |  | $ | - - |  |  | $ | 0.42 |  |  | $ | 1.69 |
Preferred Stock - Series O (3): |  |  |  |  |  |  |  |  |  |  |  |
Ordinary income |  | $ | - - |  |  | $ | - |  |  | $ | 0.59 |
Qualified dividend |  |  | - - |  |  |  | - |  |  |  | 0.31 |
Capital gains |  |  | - - |  |  |  | 0.44 |  |  |  | 0.85 |
Total dividend |  | $ | - - |  |  | $ | 0.44 |  |  | $ | 1.75 |
Preferred Stock - Series P (3): |  |  |  |  |  |  |  |  |  |  |  |
Ordinary income |  | $ | - - |  |  | $ | - |  |  | $ | 0.58 |
Qualified dividend |  |  | - - |  |  |  | - |  |  |  | 0.30 |
Capital gains |  |  | - - |  |  |  | 0.43 |  |  |  | 0.83 |
Total dividend |  | $ | - - |  |  | $ | 0.43 |  |  | $ | 1.71 |
Preferred Stock - Series Q: |  |  |  |  |  |  |  |  |  |  |  |
Ordinary income |  | $ | 0.71 |  |  | $ | - |  |  | $ | 1.44 |
Qualified dividend |  |  | 1.01 |  |  |  | - |  |  |  | 0.75 |
Capital gains |  |  | 2.55 |  |  |  | 4.27 |  |  |  | 2.08 |
Total dividend |  | $ | 4.27 |  |  | $ | 4.27 |  |  | $ | 4.27 |

(1) | Items indicated by ‘- - ‘ are not applicable.

(2) | Taxability for 2014 is estimated.

(3) | As discussed above, in April 2013, we redeemed all of the outstanding series L, M, O, P, R and S preferred stock.

Common stock dividends are characterized for federal income tax purposes as ordinary income, qualified dividend, capital gains, non-taxable return of capital or a combination of the four. Common stock dividends that exceed our current and accumulated earnings and profits (calculated for tax purposes) constitute a return of capital rather than a dividend and generally reduce the stockholder’s basis in the common stock. To the extent that a dividend exceeds both current and accumulated earnings and profits and the stockholder’s basis in the common stock, it will generally be treated as a gain from the sale or exchange of that stockholder’s common stock. At the beginning of each year, we notify our stockholders of the taxability of the common stock dividends paid during the preceding year.

Pursuant to the terms of our preferred stock, we are restricted from declaring or paying any dividend with respect to our common stock unless and until all cumulative dividends with respect to the preferred stock have been paid and sufficient funds have been set aside for dividends that have been declared for the relevant dividend period with respect to the preferred stock.

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11. | Partners’ Capital of Prologis, L.P.

Distributions paid to the common limited partnership units and the taxability of the distributions are similar to the Parent’s common stock disclosed above.

12. | Noncontrolling Interests

Prologis, L.P.

We report noncontrolling interests related to several entities we consolidate but of which we do not own 100% of the common equity. These entities include two 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 the Parent’s common stock (or cash), generally at a rate of one share of common stock to one unit. 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% of the equity and the units of the entity are not exchangeable into our common stock.

As discussed in Note 3, we began consolidating the co-investment venture NAIF in October 2014.

In the first quarter of 2014, we formed a new U.S. co-investment venture, Prologis U.S. Logistics Venture, in which we hold a 55% equity ownership interest and have one partner. The venture is consolidated due to the structure and voting rights of the venture. At closing, the venture acquired from us a portfolio of 66 operating properties aggregating 12.8 million square feet for an aggregate purchase price of $1.0 billion.

In the second quarter of 2013, we acquired our partners’ interest in Prologis Institutional Alliance Fund II (“Fund II”), a consolidated co-investment venture. In connection with this transaction, we paid $245.8 million and issued approximately 805,000 limited partnership units worth $31.3 million in one of our limited partnerships based primarily on appraised values of the properties. These units are exchangeable into cash or an equal number of shares of our common stock, at our option.

In the second quarter of 2013, we earned a promote from Fund II, of $18.8 million from the fund, which was based on the venture’s cumulative returns of the investors over the life of the venture. Of that amount, $13.5 million represented the third-party investors’ portion and is reflected as a component of Noncontrolling Interest in the Consolidated Statements of Operations.

Prologis, Inc.

The noncontrolling interest of the Parent 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 Parent.

During 2013, net earnings attributable to noncontrolling interests was $10.1 million, of which $0.5 million was a loss from continuing operations and $10.6 million was income from discontinued operations. Amounts allocated to discontinued operations for 2012 were not considered significant.

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The following is a summary of the noncontrolling interest and the consolidated entity’s total investment in real estate and debt at December 31 (dollars and units in thousands):

|  | Our Ownership Percentage |  |  | Noncontrolling Interest |  |  | Total Investment In Real Estate |  |  | Debt |
|  | 2014 |  |  | 2013 |  |  | 2014 |  |  | 2013 |  |  | 2014 |  |  | 2013 |  |  | 2014 |  |  | 2013 |
Partnerships with exchangeable units (1) |  |  | various |  |  |  | various |  |  | $ | 70,716 |  |  | $ | 75,532 |  |  | $ | 711,310 |  |  | $ | 783,052 |  |  | $ | - |  |  | $ | - |
Prologis North American Industrial Fund |  |  | 66.1% |  |  |  | N/A |  |  |  | 544,718 |  |  |  | - |  |  |  | 2,771,299 |  |  |  | - |  |  |  | 1,188,836 |  |  |  | - |
Prologis U.S. Logistics Venture |  |  | 55.0% |  |  |  | N/A |  |  |  | 427,307 |  |  |  | - |  |  |  | 1,006,183 |  |  |  | - |  |  |  | - |  |  |  | - |
Brazil Fund (2) |  |  | 50.0% |  |  |  | 50.0% |  |  |  | 68,533 |  |  |  | 65,006 |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |
Mexico Fondo Logistico (AFORES) (3) |  |  | 20.0% |  |  |  | 20.0% |  |  |  | 17,122 |  |  |  | 220,292 |  |  |  | - |  |  |  | 457,006 |  |  |  | - |  |  |  | 191,866 |
Other consolidated entities |  |  | various |  |  |  | various |  |  |  | 31,505 |  |  |  | 56,256 |  |  |  | 307,686 |  |  |  | 370,933 |  |  |  | 18,269 |  |  |  | 48,126 |
Prologis, L.P. noncontrolling interests |  |  |  |  |  |  |  |  |  |  | 1,159,901 |  |  |  | 417,086 |  |  |  | 4,796,478 |  |  |  | 1,610,991 |  |  |  | 1,207,105 |  |  |  | 239,992 |
Limited partners in Prologis, L.P. (4) |  |  |  |  |  |  |  |  |  |  | 48,189 |  |  |  | 48,209 |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |
Prologis, Inc. noncontrolling interests |  |  |  |  |  |  |  |  |  | $ | 1,208,090 |  |  | $ | 465,295 |  |  | $ | 4,796,478 |  |  | $ | 1,610,991 |  |  | $ | 1,207,105 |  |  | $ | 239,992 |

(1) | At December 31, 2014 and 2013, there were limited partnership units that were exchangeable into cash or, at our option, 1,887 and 1,949 shares, respectively, of the Parent’s common stock. In 2014, 62 limited partnership units were redeemed for cash of $2.5 million. All of these outstanding limited partnership units receive quarterly cash distributions equal to the quarterly dividends paid on our common stock pursuant to the terms of the applicable partnership agreements.

(2) | We have a 50% ownership interest in and consolidate the Brazil Fund. The Brazil Fund’s assets are primarily investments in unconsolidated entities of $152.0 million at December 31, 2014. For additional information on our unconsolidated investments, see Note 5.

(3) | In 2014, AFORES contributed its remaining operating properties and the balance of its secured debt to FIBRA Prologis in two separate transactions. The difference between the amount received and the noncontrolling interest balance related to the properties contributed was $34.6 million, and was adjusted through equity with no gain or loss recognized. See Notes 4 and 5 for more information on these transactions.

(4) | At December 31, 2014 and 2013, there were limited partnership units in the Operating Partnership that were exchangeable into cash or, at our option, 1,767 shares of the Parent’s common stock. In 2014, no limited partnership units were redeemed for cash or the Parent’s common stock. All of these outstanding limited partnership units receive quarterly cash distributions equal to the quarterly distributions paid on our common stock pursuant to the terms of the partnership agreement.

13. | Long-Term Compensation

In May 2012, stockholders approved the 2012 LTIP. All outstanding awards granted under the previous plans remain outstanding in accordance with their terms. The 2012 LTIP provides for grants of awards to officers, directors, employees, and consultants of the Parent or its subsidiaries. Awards can be in the form of stock options (non-qualified options and incentive stock options), stock appreciation rights and full value awards (restricted stock, restricted stock units (“RSUs”) and performance-based shares, restricted Operating Partnership units (“LTIP Units”) and cash incentive awards). No participant can be granted more than 1.5 million awards under the 2012 LTIP in any one calendar year. Awards may be made under the 2012 LTIP until it is terminated by the Board or until the ten-year anniversary of the effective date of the plan. We began granting awards in the form of LTIP Units during 2014. An LTIP Unit represents a partnership interest in the Operating Partnership. After vesting and the satisfaction of certain conditions, an LTIP Unit may be exchangeable for a common unit in the Operating Partnership and then redeemable for a share of common stock.

We have 27.2 million shares reserved for issuance, of which 23.1 million shares of common stock were available for future issuance at December 31, 2014. Each LTIP Unit counts as one share of common stock for purposes of calculating the limit on shares that may be issued.

Out-Performance Plan (“OPP”)

We grant awards in the form of points under our OPP corresponding to three-year performance periods. The fair value of the awards are measured at the grant date and amortized over the performance period. OPP awards are earned to the extent our total stockholder return

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(“TSR”) for the performance period exceeds the TSR for the MSCI US REIT Index for the same period plus 100 basis points. If this outperformance hurdle is met, the compensation pool is equal to 3% of the excess value created, subject to a maximum of the greater of $75 million or 0.5% of our equity market capitalization at the start of the performance period. Each participant is allocated a percentage of the total compensation pool. Awards earned at the end of the performance period cannot be paid to participants unless our absolute TSR, as defined in the plan, is positive for the performance period. If we outperform the TSR for the MSCI US REIT Index plus 100 basis points, but the absolute TSR is not positive, payment will be delayed until such time as our absolute TSR becomes positive. If after seven years our absolute TSR has not become positive, the awards will be forfeited.

We used the Monte Carlo valuation model to value the points granted in 2014, 2013 and 2012. The points relate to a three-year performance period that begins on January 1 of the year granted. If the performance criteria are met, the participants’ points will be paid in the form of common stock or LTIP Units. In 2014, we gave certain participants the election to choose the form of payment of awards earned, if any, in common stock of the Parent or a special OPP type of LTIP Units (the “OPP LTIP Units”) that represents restricted operating partnership units in the Operating Partnership. For future performance periods, a participant may elect to receive common stock in the event that the performance criteria under the OPP are met or OPP LTIP Units upon the award of participation points. If the performance criteria are not met, the participation points and the OPP LTIP Units will be forfeited. At December 31, 2014, all awards are equity classified.

The 2012 grant was originally liability classified as the payment was expected to be in cash and the fair value was re-measured on a quarterly basis and the expense was adjusted. On May 1, 2013, the compensation committee of the Board approved a modification of the settlement terms for the awards to be paid in shares of common stock. The award was reclassified from liability to equity based on the fair value at the date of modification date. At December 31, 2014, the performance criteria were not met for the 2012 grant, and, therefore, no awards were earned and the points and OPP LTIP Units for the 2012-2014 performance period were forfeited.

The following table details the assumptions of each grant based on the year it was granted (dollars in thousands):

|  | 2014 |  |  | 2013 |  |  | 2012 (1) |
Risk free interest rate |  |  | 0.67% |  |  |  | 0.39% |  |  |  | 0.17% |
Expected volatility |  |  | 38% |  |  |  | 38% |  |  |  | 23% |
Aggregate fair value |  | $ | 23,100 |  |  | $ | 23,900 |  |  | $ | 36,100 |

(1) | These assumptions are based on the date the grant was modified in 2013.

Prologis Promote Plan (“PPP”)

Under the PPP, we established a compensation pool equal to 40% of the aggregate promotes earned by Prologis under agreements with our co-investment ventures, representing the third-party portion. The awards may be settled in cash or RSUs and, as of August 2014, participants may elect to receive LTIP Units in lieu of RSUs. The RSUs and LTIP Units have a three-year vesting period. At the beginning of each year, each participant is allocated a percentage of the total compensation pool for each applicable new co-investment venture.

A compensation pool was funded in August 2014 and 2013 associated with promotes earned from two of our co-investment ventures, as discussed in Note 5. The total value of the awards in the third quarter of 2014 was $11.3 million, of which $4.2 million was paid in cash, approximately 57,000 RSUs were issued with a grant date fair value of $2.4 million and approximately 113,000 LTIP Units were issued with a grant date fair value of $4.7 million. The total value of the awards issued in the third quarter of 2013 was $5.3 million, of which $2.7 million was paid in cash and approximately 69,000 RSUs were issued with a grant date fair value of $2.6 million.

We record an accrual for the estimated cash portion of the PPP at the same time the revenue is recognized.

Restricted Stock Units (“RSUs”)

In addition to the RSU’s granted under the OPP and PPP, we grant RSUs to certain employees, generally on an annual basis. Each award represents one share of common stock of the Parent and generally vests over a continued service period. The RSUs earn cash dividends during the vesting period and are, therefore, considered participating securities. We charge the value of the dividend to retained earnings. The fair value of the RSU is generally based on the market price of the Parent’s common stock on the date the award is granted and is charged to compensation expense during the vesting period, which is generally three years.

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The activity for the year ended December 31, 2014 with respect to our RSUs was as follows (awards in thousands):

|  | Number of Unvested RSUs |  |  | Weighted Average Grant-Date Fair Value |  |  | Number of Awards Vested |
Balance at January 1, 2014 |  |  | 2,266 |  |  | $ | 36.82 |  |  |  | 79 |
Granted |  |  | 1,329 |  |  |  | 40.85 |  |  |  |  |
Vested and distributed |  |  | (1,019) |  |  |  | 35.70 |  |  |  |  |
Forfeited |  |  | (55) |  |  |  | 38.20 |  |  |  |  |
Balance at December 31, 2014 |  |  | 2,521 |  |  | $ | 39.38 |  |  |  | 106 |

Total remaining compensation cost related to RSUs outstanding at December 31, 2014 was $52.4 million, prior to adjustments for capitalized amounts due to our development and leasing activities. The remaining compensation cost will be recognized through 2018, with a weighted average period of 1.4 years.

Restricted Operating Partnership Units (“LTIP Units”)

LTIP Units are valued based on the market price of the Parent’s common stock on the date the award is granted and generally vest ratably over three years. Distributions are paid with respect to the LTIP Units during the vesting period and, therefore, such LTIP Units are considered participating securities. OPP LTIP Units are paid distributions during the performance period equal to one tenth of a common stock dividend and may not be exchanged for a common unit in the Operating Partnership until earned and certain conditions are met. OPP LTIP units are therefore not considered a participating security. The value of the distribution is charged to Net Income Attributable to Noncontrolling Interest in the Operating Partnership in the Consolidated Statements of Operations.

The activity for the year ended December 31, 2014 with respect to the LTIP Units issued under the PPP (as explained above) was as follows (units in thousands):

|  | Number of Unvested LTIP Units |  |  | Weighted Average Grant-Date Fair Value |
Balance at January 1, 2014 |  |  | - |  |  | $ | - |
Granted |  |  | 113 |  |  |  | 41.43 |
Vested and distributed |  |  | - |  |  |  | - |
Forfeited |  |  | - |  |  |  | - |
Balance at December 31, 2014 |  |  | 113 |  |  | $ | 41.43 |

Total remaining compensation cost related to LTIP Units at December 31, 2014 was $4.2 million, prior to adjustments for capitalized amounts due to our development and leasing activities. The remaining compensation cost will be recognized through 2017, with a weighted average period of 1.9 years.

During 2014, certain participants of the 2012 LTIP were offered the election to exchange outstanding but unvested full value awards for LTIP Units, which exchange was completed in January 2015. In addition, in 2014, certain participants were offered an election to receive grants of LTIP Units in lieu of future grants of RSUs under the 2012 LTIP and PPP. The LTIP Units issued pursuant to such elections will have the same vesting period and grant date fair value as the RSUs issuable under such awards.

In December 2014, participants in the OPP were offered the election to exchange their previously granted participation points into OPP LTIP Units. In such election, participation points were exchanged into 2.8 million OPP LTIP Units with respect to the 2012-2014, 2013-2015 and 2014-2016 performance periods. The performance criteria for the 2012-2014 performance period was not met. As a result, no OPP awards for the 2012-2014 performance period were earned and, in January 2015, all OPP LTIP Units that were associated 2012-2014 performance period were forfeited with no impact in 2014.

Stock Options

We have 5.3 million stock options outstanding and exercisable at December 31, 2014 with a weighted average exercise price of $34.80 and a weighted average life of 3.8 years. The aggregate intrinsic value of exercised options was $5.8 million, $9.6 million, and $21.3 million for the years ended December 31, 2014, 2013 and 2012, respectively. No stock options were granted in the three-year period ended December 31, 2014.

Other Plans

The Prologis 401(k) Plan ( the “401(k) Plan”) provides for matching employer contributions of 50 cents for every dollar contributed by an employee, up to 6% of the employee’s annual compensation (within the statutory compensation limit). In the 401(k) Plan, vesting in the

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matching employer contributions is based on the employee’s years of service, with 100% vesting at the completion of one year of service. Our contributions under the matching provisions were $2.2 million, $2.1 million and $1.8 million for 2014, 2013 and 2012, respectively.

We have a non-qualified savings plan that allows highly compensated employees the opportunity to defer the receipt and income taxation of a certain portion of their compensation in excess of the amount permitted under the 401(k) Plan. There has been no employer matching in the three-year period ended December 31, 2014.

14. | Merger, Acquisition and Other Integration Expenses

In 2011, AMB Property Corporation (“AMB”) completed a merger (the “Merger”) with ProLogis. In the Merger, AMB was the legal acquirer and ProLogis was the accounting acquirer. Following the Merger, AMB changed its name to Prologis.

In 2012, we incurred $80.7 million of costs related principally to severance in connection with the Merger; non-capitalizable system implementation; additional costs due to the liquidation of an unconsolidated co-investment venture we acquired in 2011 and severance and costs due to organizational changes in Europe to centralize finance activities and gain efficiencies.

15. | Impairment Charges

Real Estate Properties

We recorded no impairment charges during 2014 or 2013. During the year ended December 31, 2012, we recognized impairment charges related to certain of our real estate properties totaling $283.5 million.

Land

In 2012, we recognized impairment charges of $77.5 million on land parcels located in Central and Eastern Europe. This impairment was based on a review that resulted in a change in our intent from develop and hold to sell for certain land parcels. We based the fair value of the land parcels on internal valuations, which were corroborated primarily from brokers’ opinion of value and comparable land sales, if available. We also recorded impairment charges of $11.4 million in 2012 on land parcels that we expected to sell as the carrying value exceeded the fair value at that time. We based the fair value of the land on purchase and sale agreements.

Operating Properties

In the fourth quarter of 2012, we announced the signing of a definitive agreement for the formation of a new fund in Europe, PELP. Based on this agreement, we assessed the recoverability of the portfolio of assets we expected to contribute to PELP by comparing the total expected proceeds to the carrying value of the portfolio of assets at December 31, 2012. As a result, we recorded impairment charges of $135.3 million in continuing operations.

During 2012, we also recorded impairment charges for properties we expected to sell to third parties or contribute to co-investment ventures of $30.6 million in discontinued operations and $28.7 million in continuing operations, respectively. We calculated the impairment charges based on the carrying values of those assets compared to the fair value, which was primarily based upon letters of intent, purchase and sale agreements and third-party appraisals.

Other Assets

In 2012, we recorded an impairment charge of $16.1 million on land that was received in exchange for a note receivable from an entity in Europe that went into administration in 2011.

16. | Income Taxes

Components of Earnings (Loss) before Income Taxes

Components of earnings (loss) before income taxes for the years ended December 31 were as follows (in thousands):

|  | 2014 |  |  | 2013 |  |  | 2012 |
Domestic |  | $ | 390,874 |  |  | $ | (404,910) |  |  | $ | (65,566) |
International |  |  | 322,754 |  |  |  | 741,172 |  |  |  | (37,251) |
Earnings (loss) before income taxes |  | $ | 713,628 |  |  | $ | 336,262 |  |  | $ | (102,817) |

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Summary of Current and Deferred Income Taxes

Components of the provision for income taxes for the years ended December 31 were as follows (in thousands):

|  | 2014 |  |  | 2013 |  |  | 2012 |
Current income tax expense (benefit): |  |  |  |  |  |  |  |  |  |  |  |
United States federal |  | $ | (6,585) |  |  | $ | 20,009 |  |  | $ | (27,897) |
International |  |  | 52,155 |  |  |  | 99,478 |  |  |  | 46,294 |
State and local |  |  | 16,014 |  |  |  | 8,501 |  |  |  | 7,383 |
Total current tax expense |  |  | 61,584 |  |  |  | 127,988 |  |  |  | 25,780 |
Deferred income tax expense (benefit): |  |  |  |  |  |  |  |  |  |  |  |
United States federal |  |  | (27,374) |  |  |  | (1,133) |  |  |  | 152 |
International |  |  | (59,866) |  |  |  | (18,934) |  |  |  | (22,119) |
Total deferred tax benefit |  |  | (87,240) |  |  |  | (20,067) |  |  |  | (21,967) |
Total income tax expense (benefit), included in continuing and discontinued operations |  | $ | (25,656) |  |  | $ | 107,921 |  |  | $ | 3,813 |

Current Income Taxes

Current income tax expense generally consists of federal income tax from our taxable REIT subsidiaries (“TRSs”), state and local income taxes and taxes incurred in foreign jurisdictions. Current income tax expense recognized during 2014 is principally due to tax triggered upon the contribution of the initial portfolio of properties by certain wholly-owned and AFORES entities to FIBRA Prologis, as the transaction was structured as an asset sale for Mexican tax purposes. The tax expense was netted against a current benefit recognized during 2014 from the operating losses generated by our United States TRS. Current tax expense in 2013 was due to the net tax expense recognized on the initial contribution of properties to PELP and NPR that were previously held in certain foreign jurisdictions and United States TRSs.

For the years ended December 31, 2014, 2013 and 2012, we recognized a net benefit for uncertain tax positions of $1.1 million, $1.8 million and $28.5 million, respectively. The benefit that was recognized in all years relates to the reversal of certain expenses due to the expiration of the statute of limitations and settlements with the taxing authorities.

During the years ended December 31, 2014, 2013 and 2012, cash paid for income taxes, net of refunds, was $105.4 million, $99.5 million and $38.4 million, respectively.

Deferred Income Taxes

Deferred income tax expense (benefit) is generally a function of the period’s temporary differences (principally basis differences between tax and financial reporting for real estate assets and equity investments) and generation of tax net operating losses that may be realized in future periods depending on sufficient taxable income.

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Deferred income tax assets and liabilities at December 31 were as follows (in thousands):

|  | 2014 |  |  | 2013 |
Gross deferred income tax assets: |  |  |  |  |  |  |  |
Net operating loss carryforwards (1) |  | $ | 346,978 |  |  | $ | 391,764 |
Basis difference - real estate properties |  |  | 105,205 |  |  |  | 133,767 |
Basis difference - equity investments |  |  | 12,401 |  |  |  | 9,238 |
Basis difference - intangibles |  |  | 5,952 |  |  |  | 8,113 |
Section 163(j) interest limitation |  |  | 32,703 |  |  |  | 33,224 |
Capital loss carryforward |  |  | 25,282 |  |  |  | 32,054 |
Other - temporary differences |  |  | 10,701 |  |  |  | 20,124 |
Total gross deferred income tax assets |  |  | 539,222 |  |  |  | 628,284 |
Valuation allowance |  |  | (518,241) |  |  |  | (583,675) |
Gross deferred income tax assets, net of valuation allowance |  |  | 20,981 |  |  |  | 44,609 |
Gross deferred income tax liabilities: |  |  |  |  |  |  |  |
Basis difference - real estate properties |  |  | 89,998 |  |  |  | 167,951 |
Built-in-gains - equity investments and real estate properties |  |  | - |  |  |  | 27,116 |
Basis difference- intangibles |  |  | 7,324 |  |  |  | 8,823 |
Other - temporary differences |  |  | 716 |  |  |  | 5,269 |
Total gross deferred income tax liabilities |  |  | 98,038 |  |  |  | 209,159 |
Net deferred income tax liabilities |  | $ | 77,057 |  |  | $ | 164,550 |

(1) | At December 31, 2014, we had net operating loss (“NOL”) carryforwards as follows (in millions):

|  | U.S. |  |  | Europe |  |  | Mexico |  |  | Japan |  |  | Other |
Gross NOL carryforward |  | $ | 92 |  |  | $ | 747 |  |  | $ | 246 |  |  | $ | 132 |  |  | $ | 67 |
Tax-effected NOL carryforward |  |  | 35 |  |  |  | 197 |  |  |  | 74 |  |  |  | 25 |  |  |  | 16 |
Valuation allowance |  |  | (35) |  |  |  | (188) |  |  |  | (74) |  |  |  | (25) |  |  |  | (16) |
Net deferred tax asset-NOL carryforward |  | $ | - |  |  | $ | 9 |  |  | $ | - |  |  | $ | - |  |  | $ | - |
Expiration periods |  |  | 2022-2033 |  |  |  | 2015-indefinite |  |  |  | 2015-2025 |  |  |  | 2015-2023 |  |  |  | 2015-indefinite |

The decrease in deferred income tax liabilities during 2014 is principally due to the reversal of deferred tax liabilities of $62.8 million in connection with the initial contribution of properties to FIBRA Prologis in June 2014, as discussed above, and $27.1 million due to the expiration of the holding period on properties previously acquired with existing built-in-gains. These decreases were partially offset by the reversal of deferred tax liabilities in 2013 related to the contribution of properties to PELP.

In addition, we utilized net operating losses (“NOLs”), for which we had previously recorded a valuation allowance against, of $37.6 million which were generated in prior years to offset current income tax expense which was triggered as part of the FIBRA transaction.

We record a valuation allowance against deferred tax assets in certain jurisdictions when we cannot sustain a conclusion that it is more likely than not that we can realize the deferred tax assets and NOL carryforwards during the periods in which these temporary differences become deductible. The deferred tax asset valuation allowance is adequate to reduce the total deferred tax asset to an amount that we estimate will “more-likely-than-not” be realized.

Liability for Uncertain Tax Positions

During the years ended December 31, 2014, 2013 and 2012, we believe that we have complied with the REIT requirements of the Internal Revenue Code. The statute of limitations for our tax returns is generally three years. As such, our tax returns that remain subject to examination would be primarily from 2011 and thereafter.

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The liability for uncertain tax positions principally consisted of estimated federal income tax liabilities and included accrued interest and penalties of $0.3 million and $0.9 million at December 31, 2014 and 2013, respectively. A reconciliation of the liability for uncertain tax positions for the years ended December 31 was as follows (in thousands):

|  | 2014 |  |  | 2013 |
Balance at January 1 |  | $ | 1,318 |  |  | $ | 7,943 |
Additions for tax positions taken during a prior year |  |  | 256 |  |  |  | 405 |
Settlements with taxing authorities |  |  | - |  |  |  | (7,030) |
Reductions due to lapse of applicable statute of limitations |  |  | (1,318) |  |  |  | - |
Balance at December 31 |  | $ | 256 |  |  | $ | 1,318 |

17. | Earnings / Loss Per Common Share / Unit

We determine basic earnings per share/unit based on the weighted average number of shares of common stock/units outstanding during the period. We compute diluted earnings per share/unit based on the weighted average number of shares outstanding combined with the incremental weighted average effect from all outstanding potentially dilutive instruments.

The following table sets forth the computation of our basic and diluted earnings per share/unit for the years ended December 31 (in thousands, except per share/unit amounts):

Prologis, Inc. |  | 2014 |  |  | 2013 |  |  | 2012 |
Net earnings (loss) attributable to common stockholders |  | $ | 622,235 |  |  | $ | 315,422 |  |  | $ | (80,946) |
Noncontrolling interest attributable to exchangeable limited partnership units |  |  | 3,636 |  |  |  | 1,305 |  |  |  | (162) |
Adjusted net earnings (loss) attributable to common stockholders |  | $ | 625,871 |  |  | $ | 316,727 |  |  | $ | (81,108) |
Weighted average common shares outstanding - Basic (1) |  |  | 499,583 |  |  |  | 486,076 |  |  |  | 459,895 |
Incremental weighted average effect on exchange of limited partnership units (2) |  |  | 3,501 |  |  |  | 2,060 |  |  |  | 1,953 |
Incremental weighted average effect of equity awards and warrants |  |  | 3,307 |  |  |  | 3,410 |  |  |  | - |
Weighted average common shares outstanding - Diluted (3) |  |  | 506,391 |  |  |  | 491,546 |  |  |  | 461,848 |
Net earnings (loss) per share attributable to common stockholders - |  |  |  |  |  |  |  |  |  |  |  |
Basic |  | $ | 1.25 |  |  | $ | 0.65 |  |  | $ | (0.18) |
Diluted |  | $ | 1.24 |  |  | $ | 0.64 |  |  | $ | (0.18) |
Prologis, L.P. |  | 2014 |  |  | 2013 |  |  | 2012 |
Net earnings (loss) attributable to common unitholders |  | $ | 624,436 |  |  | $ | 316,630 |  |  | $ | (81,108) |
Noncontrolling interest attributable to exchangeable limited partnership units |  |  | 1,435 |  |  |  | 97 |  |  |  | - |
Adjusted net earnings (loss) attributable to common unitholders |  | $ | 625,871 |  |  | $ | 316,727 |  |  | $ | (81,108) |
Weighted average common partnership units outstanding - Basic (1) |  |  | 501,349 |  |  |  | 487,936 |  |  |  | 461,848 |
Incremental weighted average effect on exchange of limited partnership units |  |  | 1,735 |  |  |  | 200 |  |  |  | - |
Incremental weighted average effect of equity awards and warrants of Prologis, Inc. |  |  | 3,307 |  |  |  | 3,410 |  |  |  | - |
Weighted average common partnership units outstanding - Diluted (3) |  |  | 506,391 |  |  |  | 491,546 |  |  |  | 461,848 |
Net earnings (loss) per unit attributable to common unitholders - |  |  |  |  |  |  |  |  |  |  |  |
Basic |  | $ | 1.25 |  |  | $ | 0.65 |  |  | $ | (0.18) |
Diluted |  | $ | 1.24 |  |  | $ | 0.64 |  |  | $ | (0.18) |

(1) | The increase in shares/units between the periods is primarily due to equity offering in April 2013.

(2) | Income (loss) allocated to the exchangeable Operating Partnership units not held by the Parent has been included in the numerator and exchangeable Operating Partnership units have been included in the denominator for the purpose of computing diluted earnings per share for all periods since the per share/unit amount is the same. The incremental weighted average exchangeable Operating Partnership units (in thousands) were 1,767, 1,860 and 1,953 for the years ended December 31, 2014, 2013 and 2012, respectively.

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(3) | Total weighted average potentially dilutive stock awards and warrant outstanding (in thousands) were 14,366, 13,998, and 9,805 for the years ended December 31, 2014, 2013 and 2012, respectively. Total weighted average potentially dilutive shares/units from exchangeable debt outstanding (in thousands) were 11,879 for all periods presented. Total weighted average potentially dilutive limited partnership units outstanding (in thousands) were 1,932, 1,558, and 1,284 for the years ended December 31, 2014, 2013 and 2012, respectively.

18. | Financial Instruments and Fair Value Measurements

Derivative Financial Instruments

In the normal course of business, our operations are exposed to global market risks, including the effect of changes in foreign currency exchange rates and interest rates. To manage these risks, we may enter into various derivative contracts, such as foreign currency contracts to manage foreign currency exposure, and interest rate swaps to manage the effect of interest rate fluctuations. We do not use derivative financial instruments for trading or speculative purposes. All of our derivative financial instruments are customized derivative transactions and are not exchange-traded. Management reviews our hedging program, derivative positions, and overall risk management strategy on a regular basis. We only enter into transactions that we believe will be highly effective at offsetting the underlying risk.

Our use of derivatives involves the risk that counterparties may default on a derivative contract. We establish exposure limits for each counterparty to minimize this risk and provide counterparty diversification. Substantially all of our derivative exposures are with counterparties that have long-term credit ratings of single-A or better. We enter into master agreements with counterparties that generally allow for netting of certain exposures; thereby significantly reducing the actual loss that would be incurred should a counterparty fail to perform its contractual obligations. To mitigate pre-settlement risk, minimum credit standards become more stringent as the duration of the derivative financial instrument increases. Based on these factors, we consider the risk of counterparty default to be minimal.

We recognize all derivatives at fair value in the Consolidated Balance Sheets within the line items Other Assets or Other Liabilities, as applicable. We do not net our derivative position by counterparty for purposes of balance sheet presentation and disclosure. Derivatives can be designated as fair value hedges, cash flow hedges or hedges of net investments in foreign operations. The accounting for gains and losses that result from changes in the fair values of derivative instruments depends on whether the derivatives are designated as, and qualify as, hedging instruments.

For derivatives that will be accounted for as hedging instruments, at inception of the transaction, we formally designate and document the financial instrument as a hedge of a specific underlying exposure, the risk management objective and the strategy for undertaking the hedge transaction. In addition, we formally assess both at inception and at least quarterly thereafter, whether the derivatives used in hedging transactions are effective at offsetting changes in either the fair values or cash flows of the related underlying exposures. The ineffective portion of a derivative financial instrument’s change in fair value, if any, is immediately recognized in earnings. We also use derivatives that are not designated as hedges (and may not meet the hedge accounting requirements) to manage our exposure to foreign currency fluctuations.

Changes in the fair value of derivatives that are designated and qualify as cash flow hedges and hedges of net investments in foreign operations are recorded in AOCI in the Consolidated Balance Sheets. Due to the high degree of effectiveness between the hedging instruments and the underlying exposures hedged, fluctuations in the value of the derivative instruments will generally be offset by changes in the fair values or cash flows of the underlying exposures being hedged. The changes in fair values of derivatives that were not designated and/or did not qualify as hedging instruments are immediately recognized in earnings. For cash flow hedges, we reclassify changes in the fair value of derivatives into the applicable line item in the Consolidated Statements of Operations in which the hedged items are recorded in the same period that the underlying hedged items affect earnings.

Our co-investment ventures may also enter into derivative contracts. As we act as the manager of these ventures, these ventures primarily follow the same hedging strategy and risk mitigation that we use. For our consolidated co-investment ventures, the accounting treatment is as described in this footnote. For our unconsolidated co-investment ventures, we record our proportionate share of any earnings impact in Earnings from Unconsolidated Entities, Net in the Consolidated Statements of Operations. In addition, for derivatives in our unconsolidated ventures that have been designated and qualify as hedging instruments, we record our proportionate share of the effective gain or loss as a component of AOCI in the Consolidated Balance Sheets. In both circumstances, we record the offsetting amount as Investments in and Advances to Unconsolidated Entities in the Consolidated Balance Sheets.

Foreign Currency

We primarily manage our foreign currency exposure by borrowing in the currencies in which we invest. In certain circumstances, we may also borrow debt in a currency that is not the same functional currency of the borrowing entity to offset the translation and economic exposures related to our net investment in international subsidiaries. To mitigate the impact to our earnings from the fluctuations in exchange rates, we may designate the debt as a non-derivative financial instrument hedge. We also hedge our investments in certain international subsidiaries using foreign currency derivative contracts (net investment hedges) to offset the translation and economic exposures related to our

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investments in these subsidiaries by locking in a forward exchange rate at the inception of the hedge. We measure the effectiveness of our net investment hedges and our non-derivative financial instrument hedges by using the changes in forward exchange rates because this method reflects our risk management strategies, the economics of those strategies in the financial statements and better manages interest rate differentials between different countries. Under this method, we report all changes in fair value of the non-derivative financial instrument and net investment hedges in equity in the foreign currency translation component of AOCI in the Consolidated Balance Sheets. These amounts offset the translation adjustments on the underlying net assets of our foreign investments, which we also record in AOCI. We recognize ineffectiveness, if any, in earnings at the time the ineffectiveness occurred. We did not record any ineffectiveness on our foreign currency derivative contracts during the three years ended December 31, 2014.

We may use foreign currency option contracts, including puts, calls and collars to mitigate foreign currency exchange rate risk associated with the translation of our projected net operating income of our international subsidiaries, principally in Europe and Japan. The put option contracts provide us with the option to exchange euros or yen for U.S. dollars at a fixed exchange rate if the euro or yen were to depreciate against the U.S. dollar, such that, if the euro or yen were to depreciate against the U.S. dollar to predetermined levels as set by the contracts, we could exercise our options and mitigate our foreign currency exchange losses. Call option contracts would create an obligation to exchange euro or yen for U.S. dollars at a fixed exchange rate if the euro or yen were to appreciate against the U.S. dollar, such that, if the euro or yen were to appreciate against the U.S. dollar to predetermined levels as set by the contracts we would be obligated to pay out under the contract and offset our foreign currency exchange gains. A collar contract combines the put and call options into one contract with the purchase of a foreign currency put option, combined with the sale of a foreign currency call option such that there is no cash outlay at execution. This strategy effectively locks in a range around the rate at which net operating earnings of our international subsidiaries will be translated into U.S. dollars.

Foreign currency option contracts are not designated as hedges as they do not meet hedge accounting requirements. Changes in the fair value of derivatives not designated in hedging relationships are recorded directly in earnings within the line item Foreign Currency and Derivative Gains (Losses) and Related Amortization, Net in the Consolidated Statements of Operations.

Interest Rate

Our interest rate risk management strategy is to limit the impact of future interest rate changes on earnings and cash flows as well as to stabilize interest expense and manage our exposure to interest rate movements. We primarily accomplish this by issuing fixed rate debt with staggering maturities. We may enter into interest rate swap agreements, which allow us to borrow on a fixed rate basis for longer-term debt issuances, or interest rate cap agreements, which allow us to minimize the impact of increases in interest rates. We typically designate our interest rate swap and interest rate cap agreements as cash flow hedges as these derivative instruments may be used to manage the interest rate risk on potential future debt issuances or to fix the interest rate on variable rate debt issuances. The maximum length of time that we hedge our exposure to future cash flows is typically less than 10 years.

We have entered into interest rate swap agreements that allow us to receive variable-rate amounts from a counterparty in exchange for us making fixed-rate payments over the life of our agreements without the exchange of the underlying notional amount.

We report the effective portion of the gain or loss on the derivative as a component of AOCI in the Consolidated Balance Sheets, and reclassify it to Interest Expense in the Consolidated Statements of Operations over the corresponding period of the hedged item. To the extent the hedged debt is paid off early, we recognize the amounts in AOCI as Gains (Losses) on Early Extinguishment of Debt, Net in the Consolidated Statements of Operations.

We recognize losses on a derivative representing hedge ineffectiveness in Interest Expense at the time the ineffectiveness occurred. Losses due to hedge ineffectiveness were not considered material during the three years ended December 31, 2014. In 2012, we recorded a loss of $11.0 million in Gain (Loss) on Early Extinguishment of Debt, Net related to interest rate swaps with a notional amount of $703.8 million that were considered ineffective. These derivatives were associated with debt that was paid off or transferred in the first quarter of 2013, in connection with the contribution to our new European co-investment venture, PELP (see Note 4 for more details of this venture). When it was probable the related forecasted transaction would not occur, we deemed the hedge ineffective and wrote-off the balance in AOCI.

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The following table summarizes the activity in our derivative instruments for the years ended December 31 as follows (in millions):

2014 |  |  |
|  | Foreign Currency Contracts |  |  | Interest Rate Swaps (2) |
|  | Net Investment Contracts |  |  | Euro Option Contracts (1) |  |
Notional amounts at January 1 |  | € | 600 |  |  | $ | 800 |  |  | £ | - |  |  | $ | - |  |  | ¥ | 24,136 |  |  | $ | 250 |  |  | € | - |  |  | $ | - |  |  | $ | 71 |
New contracts |  |  | 1,746 |  |  |  | 2,354 |  |  |  | 238 |  |  |  | 400 |  |  |  | 79,010 |  |  |  | 769 |  |  |  | 365 |  |  |  | 464 |  |  |  | 398 |
Matured or expired contracts |  |  | (2,046) |  |  |  | (2,754) |  |  |  | - |  |  |  | - |  |  |  | (79,010) |  |  |  | (769) |  |  |  | (81) |  |  |  | (110) |  |  |  | (71) |
Notional amounts at December 31 |  | € | 300 |  |  | $ | 400 |  |  | £ | 238 |  |  | $ | 400 |  |  | ¥ | 24,136 |  |  | $ | 250 |  |  | € | 284 |  |  | $ | 354 |  |  | $ | 398 |
Weighted Average Forward Rate at December 31 |  |  |  |  |  |  | 1.33 |  |  |  |  |  |  |  | 1.68 |  |  |  |  |  |  |  | 96.54 |  |  |  |  |  |  |  | 1.25 |  |  |  |  |
Active contracts at December 31 |  |  |  |  |  |  | 4 |  |  |  |  |  |  |  | 3 |  |  |  |  |  |  |  | 3 |  |  |  |  |  |  |  | 8 |  |  |  | 2 |

2013 |  |  |
|  | Foreign Currency Contracts |  |  | Interest Rate Swaps (3) |
|  | Net Investment Contracts |  |
Notional amounts at January 1 |  | € | 1,000 |  |  | $ | 1,304 |  |  | ¥ | - |  |  | $ | - |  |  | $ | 1,315 |
New contracts |  |  | 600 |  |  |  | 800 |  |  |  | 24,136 |  |  |  | 250 |  |  |  | - |
Matured or expired contracts |  |  | (1,000) |  |  |  | (1,304) |  |  |  | - |  |  |  | - |  |  |  | (1,244) |
Notional amounts at December 31 |  | € | 600 |  |  | $ | 800 |  |  | ¥ | 24,136 |  |  | $ | 250 |  |  | $ | 71 |

2012 |  |  |
|  | Foreign Currency Contracts |  |  | Interest Rate Swaps (4) |
|  | Net Investment Contracts |  |
Notional amounts at January 1 |  | € | - |  |  | $ | - |  |  | $ | 1,497 |
New contracts |  |  | 1,000 |  |  |  | 1,304 |  |  |  | 445 |
Acquired contracts |  |  | - |  |  |  | - |  |  |  | 71 |
Matured or expired contracts |  |  | - |  |  |  | - |  |  |  | (698) |
Notional amounts at December 31 |  | € | 1,000 |  |  | $ | 1,304 |  |  | $ | 1,315 |

(1) | During 2014, we exercised three foreign currency option contracts, and recognized a net gain of approximately $1.1 million.

(2) | During the third quarter of 2014, we entered into two contracts with a total notional amount of ¥40.9 billion to effectively fix the interest rate on the Yen Term Loan. See Note 9 for more information on the Yen Term Loan.

(3) | During 2013, we settled 13 contracts with a notional value of $333.5 million, and contributed 13 contracts with a notional value of $383.9 million related to the transfer of assets to the newly formed PELP co-investment venture. We also settled five contracts in Japan with a notional value of $526.4 million in connection with the contributions of properties to NPR.

(4) | In 2012, we entered into four interest rate swap contracts with combined notional amounts of $445.4 million, with various expiration dates between 2017 and 2019. In addition, we acquired one interest rate swap contract with a notional amount of $71.0 million in connection with the acquisition of a controlling interest in one of our unconsolidated co-investment ventures.

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The following table presents the fair value of our derivative instruments (in thousands):

|  | December 31, 2014 |  |  | December 31, 2013 |
|  | Asset |  |  | Liability |  |  | AOCI |  |  | Asset |  |  | Liability |  |  | AOCI |
Net investment hedges - euro denominated |  | $ | 22,891 |  |  | $ | - |  |  | $ | 37,295 |  |  | $ | 137 |  |  | $ | 30,302 |  |  | $ | (21,705) |
Net investment hedges - yen denominated |  |  | 46,934 |  |  |  | - |  |  |  | 56,169 |  |  |  | 20,104 |  |  |  | - |  |  |  | 22,102 |
Net investment hedges - pounds sterling denominated |  |  | 29,097 |  |  |  | - |  |  |  | 29,097 |  |  |  | - |  |  |  | - |  |  |  | - |
Foreign currency options - euro denominated (1) |  |  | 7,742 |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |
Interest rate swap hedges (2) |  |  | - |  |  |  | 1,395 |  |  |  | (1,395) |  |  |  | - |  |  |  | 5,638 |  |  |  | (591) |
Our share of derivatives from unconsolidated co-investment ventures (3) |  |  | - |  |  |  | - |  |  |  | (19,545) |  |  |  | - |  |  |  | - |  |  |  | (13,851) |
Total fair value of derivatives |  | $ | 106,664 |  |  | $ | 1,395 |  |  | $ | 101,621 |  |  | $ | 20,241 |  |  | $ | 35,940 |  |  | $ | (14,045) |

(1) | As discussed above, the foreign currency options are not designated as hedges. We recognized gains of $7.7 million in Foreign Currency and Derivative Losses and Related Amortization, Net in the Consolidated Statements of Operations from the change in value of our outstanding foreign currency option contracts for the year ended December 31, 2014.

(2) | In connection with the contributions to NPR, we reclassified a loss related to interest rate swaps of $7.8 million during the first quarter of 2013 from AOCI in the Consolidated Balance Sheets to Losses on Early Extinguishment of Debt, Net in the Consolidated Statements of Operations.

(3) | Items indicated by ‘- - ‘ are not applicable

The change in Other Comprehensive Income (Loss) in the Consolidated Statements of Comprehensive Income (Loss) during the periods presented is due to the translation upon consolidation of the financial statements into U.S. dollars of our consolidated subsidiaries whose functional currency is not the U.S. dollar for which we recorded losses of $614.8 million, $237.6 million and $61.6 million for the years ended December 31, 2014, 2013 and 2012, respectively. It also includes the change in fair value for the effective portion of our derivative and non-derivative instruments. The following table presents the gains and losses associated with the change in fair value for the effective portion of our derivative and non-derivative instruments included in Other Comprehensive Income (Loss) (in thousands):

|  | 2014 |  |  | 2013 |  |  | 2012 |
Derivative net investment hedges (1) |  | $ | 122,164 |  |  | $ | 17,847 |  |  | $ | (17,450) |
Interest rate swap hedges (2) |  |  | (804) |  |  |  | (69) |  |  |  | 6,651 |
Our share of derivatives from unconsolidated co-investment ventures |  |  | (5,694) |  |  |  | 19,659 |  |  |  | 11,335 |
Total gain (loss) on derivative instruments |  |  | 115,666 |  |  |  | 37,437 |  |  |  | 536 |
Non-derivative net investment hedges (3) |  |  | 321,196 |  |  |  | (14,910) |  |  |  | - |
Total gain on derivative and non-derivative instruments |  | $ | 436,862 |  |  | $ | 22,527 |  |  | $ | 536 |

(1) | This includes gains of $6.3 million and $4.3 million for the years ended December 31, 2014 and 2013, respectively, upon the settlement of net investment hedges.

(2) | The amounts reclassified to interest expense for the years ended December 31, 2014 and 2013 were not considered significant. The amount reclassified to interest expense for the year ended December 31, 2012, was $14.7 million. We do not expect the amounts reclassified to interest expense for the next 12 months to be significant.

(3) | As discussed in Note 9, we issued €1.8 billion ($2.4 billion) of debt in 2014. This debt was issued by the Operating Partnership, which is a U.S. dollar functional entity, and designated as a non-derivative financial instrument hedge. At December 31, 2014 and 2013, we had €2.5 billion ($3.0 billion) and €700 million ($1.0 billion) of debt, net of accrued interest, respectively, designated as non-derivative financial instrument hedges of our net investment in international subsidiaries. We had €97.6 million ($118.5 million) of debt that was not designated as a non-derivative financial instrument hedge at December 31, 2014. We recognized unrealized gains of $7.5 million in Foreign Currency and Derivative Gains (Losses) and Related Amortization, Net in the Consolidated Statements of Operations on the unhedged portion or our debt in 2014.

Fair Value Measurements

We have estimated the fair value of our financial instruments using available market information and valuation methodologies we believe to be appropriate for these purposes. Considerable judgment and a high degree of subjectivity are involved in developing these estimates and, accordingly, they are not necessarily indicative of amounts that we would realize upon disposition.

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Fair Value Measurements on a Recurring Basis

At December 31, 2014 and 2013, other than the derivatives discussed above and in Note 9, we did not have any significant financial assets or financial liabilities that are measured at fair value on a recurring basis in the Consolidated Financial Statements. We determined the fair value of our derivative instruments using widely accepted valuation techniques including discounted cash flow analysis on the expected cash flows of each derivative. This analysis reflects the contractual terms of the derivatives, including the period to maturity, and uses observable market-based inputs, including interest rate curves, foreign exchange rates, and implied volatilities. We determined the fair values of our interest rate swaps using the market standard methodology of netting the discounted future fixed cash receipts or payments and the discounted expected variable cash payments. We based the variable cash payments on an expectation of future interest rates, or forward curves, derived from observable market interest rate curves. We based the fair values of our net investment hedges upon the change in the spot rate at the end of the period as compared to the strike price at inception.

We incorporate credit valuation adjustments to appropriately reflect both our nonperformance risk and the respective counterparty’s nonperformance risk in the fair value measurements. In adjusting the fair value of our derivative contracts for the effect of nonperformance risk, we have considered the impact of netting and any applicable credit enhancements, such as collateral postings, thresholds, mutual puts and guarantees.

We have determined that the majority of the inputs used to value our derivatives fall within Level 2 of the fair value hierarchy. Although the credit valuation adjustments associated with our derivatives utilize Level 3 inputs, such as estimates of current credit spreads to evaluate the likelihood of default by us and our counterparties, we assessed the significance of the impact of the credit valuation adjustments on the overall valuation of our derivative positions and have determined that the credit valuation adjustments are not significant to the overall valuation of our derivatives. As a result, all of our derivatives held at December 31, 2014 and 2013, were classified as Level 2 of the fair value hierarchy.

Fair Value Measurements on Non-Recurring Basis

Assets measured at fair value on a non-recurring basis in the Consolidated Financial Statements consist of real estate assets and investments in and advances to unconsolidated entities that were subject to impairment charges. There were no assets that met this criteria at December 31, 2014 or 2013.

Fair Value of Financial Instruments

At December 31, 2014 and 2013, our carrying amounts of certain financial instruments, including cash and cash equivalents, restricted cash, accounts and notes receivable, accounts payable and accrued expenses were representative of their fair values due to the short-term nature of these instruments.

At December 31, 2014 and 2013, we estimated the fair value of our senior notes and exchangeable senior notes based upon quoted market prices for the same (Level 1) or similar (Level 2) issues when current quoted market prices are available, the fair value of our Credit Facilities by discounting the future cash flows using rates and borrowing spreads currently available to us (Level 3), and the fair value of our secured mortgage debt and assessment bonds that do not have current quoted market prices available by discounting the future cash flows using rates currently available to us for debt with similar terms and maturities (Level 3). The differences in the fair value of our debt from the carrying value in the table below are the result of differences in interest rates and/or borrowing spreads that were available to us at December 31, 2014 and 2013, as compared with those in effect when the debt was issued or acquired, including reduced borrowing spreads due to our improved credit ratings. The senior notes and many of the issues of secured mortgage debt contain pre-payment penalties or yield maintenance provisions that could make the cost of refinancing the debt at lower rates exceed the benefit that would be derived from doing so.

The following table reflects the carrying amounts and estimated fair values of our debt at December 31 (in thousands):

|  | 2014 |  |  | 2013 |
|  | Carrying Value |  |  | Fair Value |  |  | Carrying Value |  |  | Fair Value |
Credit Facilities |  | $ | - |  |  | $ | - |  |  | $ | 725,483 |  |  | $ | 725,679 |
Senior notes |  |  | 6,076,920 |  |  |  | 6,593,657 |  |  |  | 5,357,933 |  |  |  | 5,698,864 |
Exchangeable senior notes |  |  | 456,766 |  |  |  | 511,931 |  |  |  | 438,481 |  |  |  | 514,381 |
Secured mortgage debt |  |  | 1,050,591 |  |  |  | 1,173,488 |  |  |  | 1,696,597 |  |  |  | 1,840,829 |
Secured mortgage debt of consolidated entities |  |  | 1,207,106 |  |  |  | 1,209,271 |  |  |  | 239,992 |  |  |  | 246,324 |
Term loans and other debt |  |  | 588,816 |  |  |  | 591,810 |  |  |  | 552,730 |  |  |  | 560,714 |
Total debt |  | $ | 9,380,199 |  |  | $ | 10,080,157 |  |  | $ | 9,011,216 |  |  | $ | 9,586,791 |

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19. | Commitments and Contingencies

Environmental Matters

A majority of the properties we acquire, including land, are subjected to environmental reviews either by us or the previous owners. In addition, we may incur environmental remediation costs associated with certain land parcels we acquire in connection with the development of the land. We have acquired certain properties that may have been leased to or previously owned by companies that discharged hazardous materials. We establish a liability at the time of acquisition to cover such costs and adjust the liabilities as appropriate when additional information becomes available. We record our environmental liabilities in Other Liabilities in the Consolidated Balance Sheets. We purchase various environmental insurance policies to mitigate our exposure to environmental liabilities. We are not aware of any environmental liability that we believe would have a material adverse effect on our business, financial condition or results of operations.

Indemnification Agreements

We have indemnification agreements related to certain co-investment ventures operating outside of the United States for the contribution of certain properties. We may enter into agreements whereby we indemnify the ventures, or our venture partners, for taxes that may be assessed with respect to certain properties we contribute to these ventures. Our contributions to these ventures are generally structured as contributions of shares of companies that own the real estate assets. Accordingly, the capital gains associated with the step up in the value of the underlying real estate assets, for tax purposes, are deferred and transferred at contribution. We have generally indemnified these ventures to the extent that the ventures: (i) incur capital gains or withholding tax as a result of a direct sale of the real estate asset, as opposed to a transaction in which the shares of the company owning the real estate asset are transferred or sold or (ii) are required to grant a discount to the buyer of shares under a share transfer transaction as a result of the ventures transferring the embedded capital gain tax liability to the buyer of the shares in the transaction. The agreements limit the amount that is subject to our indemnification with respect to each property to 100% of the actual tax liabilities related to the capital gains that are deferred and transferred by us to the ventures at the time of the initial contribution less any deferred tax assets transferred with the property.

The ultimate outcome under these agreements is uncertain as it is dependent on the method and timing of dissolution of the related venture or disposition of any properties by the venture. We record liabilities related to the indemnification agreements in Other Liabilities in the Consolidated Balance Sheets. We continue to monitor these agreements and the likelihood of the sale of assets that would result in recognition and will adjust the potential liability in the future as facts and circumstances dictate.

Off-Balance Sheet Liabilities

We have issued performance and surety bonds and standby letters of credit in connection with certain development projects. Performance and surety bonds are commonly required by public agencies from real estate developers. Performance and surety bonds are renewable and expire upon the completion of the improvements and infrastructure. At December 31, 2014 and 2013, we had approximately $54.5 million and $25.5 million, respectively, outstanding under such arrangements.

We may be required under capital commitments or choose to make additional capital contributions to certain of our unconsolidated entities, representing our proportionate ownership interest, should additional capital contributions be necessary to fund development or acquisition costs, repayment of debt or operation shortfalls. See Note 5 for further discussion related to equity commitments to our unconsolidated entities.

Litigation

In the normal course of business, from time to time, we and our unconsolidated entities are parties to a variety of legal proceedings arising in the ordinary course of business. We believe that, with respect to any such matters that we are currently a party to, the ultimate disposition of any such matter will not result in a material adverse effect on our business, financial position or results of operations.

20. | Business Segments

Our current business strategy includes two operating segments: Real Estate Operations and Strategic Capital. We generate revenues, earnings, net operating income and cash flows through our segments, as follows:

| • |  | Real Estate Operations. This represents the ownership of industrial operating properties and is the main source of our revenue and earnings. We collect rent from our customers through operating leases, including reimbursements for the majority of our operating costs. Each operating property is considered to be an individual operating segment having similar economic characteristics that are combined within the reportable segment based upon geographic location. Our Real Estate Operations segment also includes development, re-development and acquisition activities that lead to rental operations. We develop, re-develop and acquire industrial properties primarily in global and regional markets to meet our customers’ needs. Within this line of business, we capitalize on: (i) the land that we currently own; (ii) the development expertise of our local teams; (iii) our global customer

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| relationships; and (iv) the demand for high-quality distribution facilities. Land held for development, properties currently under development and land we own and lease to customers under ground leases are also included in this segment.

| • |  | Strategic Capital. This represents the management of unconsolidated co-investment ventures. We invest with partners and investors through our ventures, both private and public. We tailor industrial portfolios to investors’ specific needs and deploy capital with a focus on larger, ventures with longer duration and open-ended funds with leading global institutions. These private and public vehicles provide capital for distinct geographies across our global platform. We hold a significant ownership interest in these ventures; we believe this aligns our interests with those of our partners. We generate strategic capital revenues from our unconsolidated co-investment ventures through asset management and property management services and we earn additional revenues from leasing, acquisition, construction, development and disposition services provided. Depending on the structure of the venture and the returns provided to our partners, we also earn revenues through promotes during the life of a venture or upon liquidation. Each unconsolidated co-investment venture we manage is considered to be an individual operating segment having similar economic characteristics that are combined within the reportable segment based upon geographic location.

Reconciliations are presented below for: (i) each reportable business segment’s revenue from external customers to Total Revenues in the Consolidated Statements of Operations; (ii) each reportable business segment’s net operating income from external customers to Earnings (Loss) before Income Taxes in the Consolidated Statements of Operations; and (iii) each reportable business segment’s assets to Total Assets in the Consolidated Balance Sheets. Our chief operating decision makers rely primarily on net operating income and similar measures to make decisions about allocating resources and assessing segment performance. The applicable components of Total Revenues, Earnings (Loss) before Income Taxes and Total Assets are allocated to each reportable business segment’s revenues, net operating income and assets. Items that are not directly assignable to a segment, such as certain corporate income and expenses, are reflected as reconciling items. The following reconciliations are presented in thousands:

|  | Years Ended December 31, |
|  | 2014 |  |  | 2013 |  |  | 2012 |
Revenues (1): |  |  |  |  |  |  |  |  |  |  |  |
Real estate operations: |  |  |  |  |  |  |  |  |  |  |  |
Americas |  | $ | 1,403,564 |  |  | $ | 1,288,925 |  |  | $ | 1,176,920 |
Europe |  |  | 74,413 |  |  |  | 174,397 |  |  |  | 435,244 |
Asia |  |  | 62,939 |  |  |  | 107,692 |  |  |  | 221,575 |
Total Real Estate Operations segment |  |  | 1,540,916 |  |  |  | 1,571,014 |  |  |  | 1,833,739 |
Strategic capital: |  |  |  |  |  |  |  |  |  |  |  |
Americas |  |  | 95,168 |  |  |  | 72,474 |  |  |  | 69,422 |
Europe |  |  | 86,549 |  |  |  | 63,794 |  |  |  | 37,047 |
Asia |  |  | 38,154 |  |  |  | 43,204 |  |  |  | 20,310 |
Total Strategic Capital segment |  |  | 219,871 |  |  |  | 179,472 |  |  |  | 126,779 |
Total revenues |  | $ | 1,760,787 |  |  | $ | 1,750,486 |  |  | $ | 1,960,518 |
Net operating income: |  |  |  |  |  |  |  |  |  |  |  |
Real estate operations: |  |  |  |  |  |  |  |  |  |  |  |
Americas |  | $ | 1,000,773 |  |  | $ | 899,053 |  |  | $ | 818,393 |
Europe |  |  | 40,627 |  |  |  | 116,178 |  |  |  | 325,571 |
Asia |  |  | 45,262 |  |  |  | 76,863 |  |  |  | 171,980 |
Total Real Estate Operations segment |  |  | 1,086,662 |  |  |  | 1,092,094 |  |  |  | 1,315,944 |
Strategic capital: |  |  |  |  |  |  |  |  |  |  |  |
Americas |  |  | 42,042 |  |  |  | 18,785 |  |  |  | 31,637 |
Europe |  |  | 57,266 |  |  |  | 41,263 |  |  |  | 21,699 |
Asia |  |  | 24,067 |  |  |  | 30,145 |  |  |  | 9,623 |
Total Strategic Capital segment |  |  | 123,375 |  |  |  | 90,193 |  |  |  | 62,959 |
Total segment net operating income |  |  | 1,210,037 |  |  |  | 1,182,287 |  |  |  | 1,378,903 |

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|  | Years Ended December 31, |
|  | 2014 |  |  | 2013 |  |  | 2012 |
Reconciling items: |  |  |  |  |  |  |  |  |  |  |  |
General and administrative expenses |  |  | (247,768) |  |  |  | (229,207) |  |  |  | (228,068) |
Depreciation and amortization |  |  | (642,461) |  |  |  | (648,668) |  |  |  | (724,262) |
Merger, acquisition and other integration expenses |  |  | - |  |  |  | - |  |  |  | (80,676) |
Impairment of real estate properties |  |  | - |  |  |  | - |  |  |  | (252,914) |
Earnings from unconsolidated entities, net |  |  | 134,288 |  |  |  | 97,220 |  |  |  | 31,676 |
Interest expense |  |  | (308,885) |  |  |  | (379,327) |  |  |  | (505,215) |
Interest and other income, net |  |  | 25,768 |  |  |  | 26,948 |  |  |  | 22,878 |
Gains on dispositions of investments in real estate and revaluation of equity investments upon acquisition of a controlling interest, net |  |  | 725,790 |  |  |  | 597,656 |  |  |  | 305,607 |
Foreign currency and derivative losses and related amortization, net |  |  | (17,841) |  |  |  | (33,633) |  |  |  | (20,497) |
Losses on early extinguishment of debt, net |  |  | (165,300) |  |  |  | (277,014) |  |  |  | (14,114) |
Impairment of other assets |  |  | - |  |  |  | - |  |  |  | (16,135) |
Total reconciling items |  |  | (496,409) |  |  |  | (846,025) |  |  |  | (1,481,720) |
Earnings (loss) before income taxes |  | $ | 713,628 |  |  | $ | 336,262 |  |  | $ | (102,817) |

|  | December 31, |
|  | 2014 |  |  | 2013 |
Assets (2): |  |  |  |  |  |  |  |
Real estate operations: |  |  |  |  |  |  |  |
Americas |  | $ | 17,432,909 |  |  | $ | 16,272,868 |
Europe |  |  | 1,820,529 |  |  |  | 1,634,867 |
Asia |  |  | 926,645 |  |  |  | 1,176,774 |
Total Real Estate Operations segment |  |  | 20,180,083 |  |  |  | 19,084,509 |
Strategic capital (3): |  |  |  |  |  |  |  |
Americas |  |  | 20,635 |  |  |  | 22,154 |
Europe |  |  | 54,577 |  |  |  | 60,327 |
Asia |  |  | 2,718 |  |  |  | 3,634 |
Total Strategic Capital segment |  |  | 77,930 |  |  |  | 86,115 |
Total segment assets |  |  | 20,258,013 |  |  |  | 19,170,624 |
Reconciling items: |  |  |  |  |  |  |  |
Investments in and advances to unconsolidated entities |  |  | 4,824,724 |  |  |  | 4,430,239 |
Assets held for sale |  |  | 43,934 |  |  |  | 4,042 |
Notes receivable backed by real estate |  |  | - |  |  |  | 188,000 |
Cash and cash equivalents |  |  | 350,692 |  |  |  | 491,129 |
Other assets |  |  | 340,860 |  |  |  | 288,273 |
Total reconciling items |  |  | 5,560,210 |  |  |  | 5,401,683 |
Total assets |  | $ | 25,818,223 |  |  | $ | 24,572,307 |

(1) | Includes revenues attributable to the United States for the years ended December 31, 2014, 2013 and 2012 of $1.4 billion, $1.1 billion and $1.1 billion, respectively.

(2) | Includes long-lived assets attributable to the United States at December 31, 2014 and 2013 of $17.3 billion and $15.3 billion, respectively.

(3) | Represents management contracts and goodwill recorded in connection with business combinations associated with the Strategic Capital segment. Goodwill was $25.3 million at December 31, 2014 and 2013.

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21. | Supplemental Cash Flow Information

Significant non-cash investing and financing activities for the years ended December 31, 2014, 2013 and 2012 are discussed below.

| • |  | We capitalized $21.6 million, $18.8 million and $10.6 million of equity-based compensation expense due to our development and leasing activities during 2014, 2013 and 2012, respectively.

| • |  | As partial consideration for properties we contributed to FIBRA Prologis and the conclusion of an unconsolidated co-investment venture during 2014, we received ownership interests in FIBRA Prologis initially valued at $609.7 million and FIBRA Prologis assumed $345.1 million of secured mortgage debt associated with the properties. See Note 4 for additional information. In 2013, as partial consideration for contributions and dispositions, the buyers assumed debt of $194.9 million.

| • |  | As partial consideration for properties we contributed to PELP during the first quarter of 2013, we received ownership interests initially valued at $1.3 billion, representing a 50% ownership interest in PELP, and PELP assumed $353.2 million of secured mortgage debt.

| • |  | During 2013 and 2012, we received $31.2 million and $17.7 million, representing ownership interests in certain unconsolidated entities as a portion of our proceeds from the contribution of properties to these entities, excluding PELP and FIBRA Prologis.

| • |  | See Note 3 for information related to acquisitions of controlling interests in our unconsolidated co-investment ventures in 2014, 2013 and 2012.

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22. | Selected Quarterly Financial Data (Unaudited)

The selected quarterly data was as follows (in thousands, except per share data):

|  | Three Months Ended, |
Prologis, Inc. |  | March 31, |  |  | June 30, |  |  | September 30, |  |  | December 31, |
2014: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Total revenues |  | $ | 434,682 |  |  | $ | 460,089 |  |  | $ | 415,151 |  |  | $ | 450,865 |
Operating income |  | $ | 71,466 |  |  | $ | 95,274 |  |  | $ | 78,112 |  |  | $ | 74,956 |
Earnings from continuing operations |  | $ | 12,003 |  |  | $ | 152,430 |  |  | $ | 147,127 |  |  | $ | 427,724 |
Net earnings attributable to common stockholders |  | $ | 4,666 |  |  | $ | 72,715 |  |  | $ | 136,245 |  |  | $ | 408,609 |
Net earnings per share attributable to common stockholders - Basic (1) |  | $ | 0.01 |  |  | $ | 0.15 |  |  | $ | 0.27 |  |  | $ | 0.82 |
Net earnings per share attributable to common stockholders - Diluted (1)(2) |  | $ | 0.01 |  |  | $ | 0.13 |  |  | $ | 0.23 |  |  | $ | 0.81 |
2013: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Total revenues |  | $ | 479,971 |  |  | $ | 410,693 |  |  | $ | 423,058 |  |  | $ | 436,764 |
Operating income |  | $ | 97,039 |  |  | $ | 58,514 |  |  | $ | 77,380 |  |  | $ | 71,479 |
Earnings (loss) from continuing operations |  | $ | 289,306 |  |  | $ | (20,591) |  |  | $ | (48,671) |  |  | $ | 9,485 |
Net earnings (loss) attributable to common stockholders |  | $ | 265,416 |  |  | $ | (1,517) |  |  | $ | (7,534) |  |  | $ | 59,057 |
Net earnings (loss) per share attributable to common stockholders - Basic (1) |  | $ | 0.58 |  |  | $ | 0.00 |  |  | $ | (0.02) |  |  | $ | 0.12 |
Net earnings (loss) per share attributable to common stockholders - Diluted (1)(2) |  | $ | 0.57 |  |  | $ | 0.00 |  |  | $ | (0.02) |  |  | $ | 0.12 |
Prologis, L.P. |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
2014: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Total revenues |  | $ | 434,682 |  |  | $ | 460,089 |  |  | $ | 415,151 |  |  | $ | 450,865 |
Operating income |  | $ | 71,466 |  |  | $ | 95,274 |  |  | $ | 78,112 |  |  | $ | 74,956 |
Earnings from continuing operations |  | $ | 12,003 |  |  | $ | 152,430 |  |  | $ | 147,127 |  |  | $ | 427,724 |
Net earnings attributable to common unitholders |  | $ | 4,683 |  |  | $ | 72,973 |  |  | $ | 136,738 |  |  | $ | 410,042 |
Net earnings per unit attributable to common unitholders - Basic (1) |  | $ | 0.01 |  |  | $ | 0.15 |  |  | $ | 0.27 |  |  | $ | 0.82 |
Net earnings per unit attributable to common unitholders - Diluted (1) (2) |  | $ | 0.01 |  |  | $ | 0.13 |  |  | $ | 0.23 |  |  | $ | 0.81 |
2013: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Total revenues |  | $ | 479,971 |  |  | $ | 410,693 |  |  | $ | 423,058 |  |  | $ | 436,764 |
Operating income |  | $ | 97,039 |  |  | $ | 58,514 |  |  | $ | 77,380 |  |  | $ | 71,479 |
Earnings (loss) from continuing operations |  | $ | 289,306 |  |  | $ | (20,591) |  |  | $ | (48,671) |  |  | $ | 9,485 |
Net earnings (loss) attributable to common unitholders |  | $ | 266,548 |  |  | $ | (1,592) |  |  | $ | (7,582) |  |  | $ | 59,256 |
Net earnings (loss) per unit attributable to common unitholders - Basic (1) |  | $ | 0.58 |  |  | $ | 0.00 |  |  | $ | (0.02) |  |  | $ | 0.12 |
Net earnings (loss) per unit attributable to common unitholders - Diluted (1)(2) |  | $ | 0.57 |  |  | $ | 0.00 |  |  | $ | (0.02) |  |  | $ | 0.12 |

(1) | Quarterly earnings (loss) per common share/unit amounts may not total to the annual amounts due to rounding and the changes in the number of weighted common shares/units outstanding included in the calculation of diluted shares/units.

(2) | Income (loss) allocated to the exchangeable Operating Partnership units not held by the Parent has been included in the numerator and exchangeable Operating Partnership units have been included in the denominator for the purpose of computing diluted earnings per share for all periods since the per share/unit is the same.

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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

The Board of Directors and Stockholders

Prologis, Inc.:

Under date of February 25, 2015, we reported on the consolidated balance sheets of Prologis, Inc. and subsidiaries as of December 31, 2014 and 2013 and the related consolidated statements of operations, comprehensive income (loss), equity, and cash flows for each of the years in the three-year period ended December 31, 2014. In connection with our audits of the aforementioned consolidated financial statements, we also audited the related financial statement schedule, Schedule III — Real Estate and Accumulated Depreciation (Schedule III). Schedule III is the responsibility of Prologis, Inc.’s management. Our responsibility is to express an opinion on Schedule III based on our audits.

In our opinion, Schedule III — Real Estate and Accumulated Depreciation, when considered in relation to the basic consolidated financial statements taken as a whole, presents fairly, in all material respects, the information set forth therein.

KPMG LLP

Denver, Colorado

February 25, 2015

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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

The Partners

Prologis, L.P.:

Under date of February 25, 2015, we reported on the consolidated balance sheets of Prologis, L.P. and subsidiaries as of December 31, 2014 and 2013 and the related consolidated statements of operations, comprehensive income (loss), capital, and cash flows for each of the years in the three-year period ended December 31, 2014. In connection with our audits of the aforementioned consolidated financial statements, we also audited the related financial statement schedule, Schedule III — Real Estate and Accumulated Depreciation (Schedule III). Schedule III is the responsibility of Prologis, L.P.’s management. Our responsibility is to express an opinion on Schedule III based on our audits.

In our opinion, Schedule III — Real Estate and Accumulated Depreciation, when considered in relation to the basic consolidated financial statements taken as a whole, presents fairly, in all material respects, the information set forth therein.

KPMG LLP

Denver, Colorado

February 25, 2015

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PROLOGIS, INC. AND PROLOGIS, L.P.

SCHEDULE III – REAL ESTATE AND ACCUMULATED DEPRECIATION

DECEMBER 31, 2014

(In thousands of U.S. dollars, as applicable)

|  | No. of Bldgs. |  |  |  |  | Initial Cost to Prologis |  |  | Costs Capitalized Subsequent To Acquisition |  |  | Gross Amounts At Which Carried at December 31, 2014 |  |  | Accumulated Depreciation (c) |  |  | Date of Construction/ Acquisition
Description |  |  | Encum- brances |  | Land |  |  | Building & Improvements |  |  |  | Land |  |  | Building & Improvements |  |  | Total (a,b) |  |  |
Industrial Operating Properties (d) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
North American Markets: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
United States: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Atlanta, Georgia |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Atlanta Airport Dist Ctr |  |  | 3 |  |  | (d) |  |  | 2,510 |  |  |  | 10,830 |  |  |  | 126 |  |  |  | 2,510 |  |  |  | 10,956 |  |  |  | 13,466 |  |  |  | (86) |  |  | 2014
Atlanta NE at Sugarloaf |  |  | 1 |  |  | (d) |  |  | 620 |  |  |  | 2,621 |  |  |  | 28 |  |  |  | 620 |  |  |  | 2,649 |  |  |  | 3,269 |  |  |  | (20) |  |  | 2014
Atlanta NE Distribution Center |  |  | 8 |  |  | (d) |  |  | 5,582 |  |  |  | 3,047 |  |  |  | 30,356 |  |  |  | 6,276 |  |  |  | 32,709 |  |  |  | 38,985 |  |  |  | (17,908) |  |  | 1996, 1997
Atlanta South Business Park |  |  | 9 |  |  |  |  |  | 5,353 |  |  |  | 28,895 |  |  |  | 2,478 |  |  |  | 5,353 |  |  |  | 31,373 |  |  |  | 36,726 |  |  |  | (4,056) |  |  | 2011
Atlanta West Distribution Center |  |  | 6 |  |  | (d) |  |  | 6,684 |  |  |  | 23,463 |  |  |  | 9,898 |  |  |  | 6,684 |  |  |  | 33,361 |  |  |  | 40,045 |  |  |  | (11,543) |  |  | 1994, 2006, 2012
Berkeley Lake Distribution Center |  |  | 1 |  |  | (d) |  |  | 2,046 |  |  |  | 8,712 |  |  |  | 742 |  |  |  | 2,046 |  |  |  | 9,454 |  |  |  | 11,500 |  |  |  | (2,048) |  |  | 2006
Breckenridge Dist Ctr |  |  | 1 |  |  | (d) |  |  | 1,645 |  |  |  | 7,030 |  |  |  | - |  |  |  | 1,645 |  |  |  | 7,030 |  |  |  | 8,675 |  |  |  | (55) |  |  | 2014
Buford Distribution Center |  |  | 1 |  |  |  |  |  | 1,487 |  |  |  | - |  |  |  | 5,577 |  |  |  | 1,487 |  |  |  | 5,577 |  |  |  | 7,064 |  |  |  | (1,219) |  |  | 2007
Carter-Pacific Bus Ctr |  |  | 3 |  |  | (d) |  |  | 1,484 |  |  |  | 6,269 |  |  |  | 12 |  |  |  | 1,484 |  |  |  | 6,281 |  |  |  | 7,765 |  |  |  | (69) |  |  | 2014
Cobb Place Dist Ctr |  |  | 2 |  |  | (d) |  |  | 2,970 |  |  |  | 12,702 |  |  |  | 218 |  |  |  | 2,970 |  |  |  | 12,920 |  |  |  | 15,890 |  |  |  | (1,413) |  |  | 2012
Dekalb Ind Ctr |  |  | 1 |  |  |  |  |  | 1,401 |  |  |  | 6,154 |  |  |  | 1,451 |  |  |  | 1,401 |  |  |  | 7,605 |  |  |  | 9,006 |  |  |  | (819) |  |  | 2012
Douglas Hill Distribution Center |  |  | 4 |  |  |  |  |  | 11,599 |  |  |  | 46,826 |  |  |  | 3,674 |  |  |  | 11,677 |  |  |  | 50,422 |  |  |  | 62,099 |  |  |  | (15,482) |  |  | 2005
Hartsfield East DC |  |  | 1 |  |  |  |  |  | 697 |  |  |  | 6,466 |  |  |  | 268 |  |  |  | 697 |  |  |  | 6,734 |  |  |  | 7,431 |  |  |  | (703) |  |  | 2011
Horizon Distribution Center |  |  | 1 |  |  |  |  |  | 2,846 |  |  |  | 11,385 |  |  |  | 1,515 |  |  |  | 2,846 |  |  |  | 12,900 |  |  |  | 15,746 |  |  |  | (2,699) |  |  | 2006
Macon Dist Ctr |  |  | 1 |  |  |  |  |  | 604 |  |  |  | 2,691 |  |  |  | 633 |  |  |  | 604 |  |  |  | 3,324 |  |  |  | 3,928 |  |  |  | (438) |  |  | 2012
Midland Distribution Center |  |  | 1 |  |  |  |  |  | 1,919 |  |  |  | 7,679 |  |  |  | 1,506 |  |  |  | 1,919 |  |  |  | 9,185 |  |  |  | 11,104 |  |  |  | (2,723) |  |  | 2006
Northeast Industrial Center |  |  | 3 |  |  |  |  |  | 3,142 |  |  |  | 14,036 |  |  |  | 2,706 |  |  |  | 3,142 |  |  |  | 16,742 |  |  |  | 19,884 |  |  |  | (3,762) |  |  | 1996, 2012
Northmont Industrial Center |  |  | 1 |  |  |  |  |  | 566 |  |  |  | 3,209 |  |  |  | 1,482 |  |  |  | 566 |  |  |  | 4,691 |  |  |  | 5,257 |  |  |  | (3,250) |  |  | 1994
Olympic Ind Ctr |  |  | 2 |  |  | (d) |  |  | 2,156 |  |  |  | 9,417 |  |  |  | 15 |  |  |  | 2,156 |  |  |  | 9,432 |  |  |  | 11,588 |  |  |  | (107) |  |  | 2014
Park I-75 South |  |  | 1 |  |  |  |  |  | 8,369 |  |  |  | - |  |  |  | 35,435 |  |  |  | 8,382 |  |  |  | 35,422 |  |  |  | 43,804 |  |  |  | (1,151) |  |  | 2013
Peachtree Corners Business Center |  |  | 4 |  |  |  |  |  | 707 |  |  |  | 4,685 |  |  |  | 2,342 |  |  |  | 707 |  |  |  | 7,027 |  |  |  | 7,734 |  |  |  | (4,800) |  |  | 1994
Piedmont Ct. Distribution Center |  |  | 2 |  |  |  |  |  | 885 |  |  |  | 5,013 |  |  |  | 3,929 |  |  |  | 885 |  |  |  | 8,942 |  |  |  | 9,827 |  |  |  | (5,731) |  |  | 1997
Riverside Distribution Center (ATL) |  |  | 4 |  |  | (d) |  |  | 3,306 |  |  |  | 16,750 |  |  |  | 4,300 |  |  |  | 3,329 |  |  |  | 21,027 |  |  |  | 24,356 |  |  |  | (9,692) |  |  | 1999, 2014
Southfield-KRDC Industrial SG |  |  | 8 |  |  |  |  |  | 5,033 |  |  |  | 28,725 |  |  |  | 1,837 |  |  |  | 5,033 |  |  |  | 30,562 |  |  |  | 35,595 |  |  |  | (4,634) |  |  | 2011
Southside Distribution Center |  |  | 1 |  |  |  |  |  | 1,186 |  |  |  | 2,859 |  |  |  | 595 |  |  |  | 1,186 |  |  |  | 3,454 |  |  |  | 4,640 |  |  |  | (589) |  |  | 2011
Suwanee Creek Dist Ctr |  |  | 2 |  |  |  |  |  | 1,045 |  |  |  | 4,201 |  |  |  | 202 |  |  |  | 1,045 |  |  |  | 4,403 |  |  |  | 5,448 |  |  |  | (448) |  |  | 2010, 2013
Tradeport Distribution Center |  |  | 3 |  |  | (d) |  |  | 1,464 |  |  |  | 4,563 |  |  |  | 8,022 |  |  |  | 1,479 |  |  |  | 12,570 |  |  |  | 14,049 |  |  |  | (7,923) |  |  | 1994, 1996
Weaver Distribution Center |  |  | 2 |  |  |  |  |  | 935 |  |  |  | 5,182 |  |  |  | 2,351 |  |  |  | 935 |  |  |  | 7,533 |  |  |  | 8,468 |  |  |  | (5,243) |  |  | 1995
Westfork Industrial Center |  |  | 2 |  |  | (d) |  |  | 579 |  |  |  | 3,910 |  |  |  | 428 |  |  |  | 579 |  |  |  | 4,338 |  |  |  | 4,917 |  |  |  | (2,749) |  |  | 1995
Westgate Ind Ctr |  |  | 1 |  |  |  |  |  | 1,277 |  |  |  | 5,620 |  |  |  | 214 |  |  |  | 1,277 |  |  |  | 5,834 |  |  |  | 7,111 |  |  |  | (757) |  |  | 2012
Atlanta, Georgia |  |  | 80 |  |  |  |  |  | 80,097 |  |  |  | 292,940 |  |  |  | 122,340 |  |  |  | 80,920 |  |  |  | 414,457 |  |  |  | 495,377 |  |  |  | (112,117) |  |  |
Austin, Texas |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Corridor Park Corporate Center |  |  | 4 |  |  |  |  |  | 4,579 |  |  |  | 19,046 |  |  |  | 75 |  |  |  | 4,579 |  |  |  | 19,121 |  |  |  | 23,700 |  |  |  | (1,024) |  |  | 2014
MET 4-12 LTD |  |  | 1 |  |  |  |  |  | 4,300 |  |  |  | 20,456 |  |  |  | 268 |  |  |  | 4,300 |  |  |  | 20,724 |  |  |  | 25,024 |  |  |  | (2,743) |  |  | 2011
MET PHASE 1 95 LTD |  |  | 4 |  |  |  |  |  | 5,593 |  |  |  | 17,211 |  |  |  | 1,286 |  |  |  | 5,593 |  |  |  | 18,497 |  |  |  | 24,090 |  |  |  | (2,474) |  |  | 2011
Montopolis Distribution Center |  |  | 1 |  |  |  |  |  | 580 |  |  |  | 3,384 |  |  |  | 2,585 |  |  |  | 580 |  |  |  | 5,969 |  |  |  | 6,549 |  |  |  | (4,257) |  |  | 1994
Southpark Corporate Center |  |  | 3 |  |  |  |  |  | 1,470 |  |  |  | 6,154 |  |  |  | 1 |  |  |  | 1,470 |  |  |  | 6,155 |  |  |  | 7,625 |  |  |  | (47) |  |  | 2014
Walnut Creek Corporate Center |  |  | 17 |  |  | (d) |  |  | 11,152 |  |  |  | 49,110 |  |  |  | 411 |  |  |  | 11,206 |  |  |  | 49,467 |  |  |  | 60,673 |  |  |  | (3,468) |  |  | 1994, 2014
Austin, Texas |  |  | 30 |  |  |  |  |  | 27,674 |  |  |  | 115,361 |  |  |  | 4,626 |  |  |  | 27,728 |  |  |  | 119,933 |  |  |  | 147,661 |  |  |  | (14,013) |  |  |
Baltimore/Washington |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
1901 Park 100 Drive |  |  | 1 |  |  | (d) |  |  | 2,409 |  |  |  | 7,227 |  |  |  | 1,148 |  |  |  | 2,409 |  |  |  | 8,375 |  |  |  | 10,784 |  |  |  | (2,616) |  |  | 2006
Airport Commons Distribution Center |  |  | 2 |  |  | (d) |  |  | 2,320 |  |  |  | - |  |  |  | 10,570 |  |  |  | 2,360 |  |  |  | 10,530 |  |  |  | 12,890 |  |  |  | (4,648) |  |  | 1997
Beltway Distribution |  |  | 1 |  |  |  |  |  | 9,211 |  |  |  | 33,922 |  |  |  | 426 |  |  |  | 9,211 |  |  |  | 34,348 |  |  |  | 43,559 |  |  |  | (4,486) |  |  | 2011
BWI Cargo Center E |  |  | 1 |  |  |  |  |  | - |  |  |  | 10,725 |  |  |  | 108 |  |  |  | - |  |  |  | 10,833 |  |  |  | 10,833 |  |  |  | (4,598) |  |  | 2011
Corcorde Industrial Center |  |  | 4 |  |  | (d) |  |  | 1,538 |  |  |  | 8,717 |  |  |  | 4,711 |  |  |  | 1,538 |  |  |  | 13,428 |  |  |  | 14,966 |  |  |  | (8,832) |  |  | 1995
Corridor Industrial |  |  | 1 |  |  |  |  |  | 1,921 |  |  |  | 7,224 |  |  |  | 12 |  |  |  | 1,921 |  |  |  | 7,236 |  |  |  | 9,157 |  |  |  | (975) |  |  | 2011
Crysen Industrial |  |  | 1 |  |  |  |  |  | 2,285 |  |  |  | 6,267 |  |  |  | 454 |  |  |  | 2,285 |  |  |  | 6,721 |  |  |  | 9,006 |  |  |  | (1,001) |  |  | 2011
Gateway Bus Ctr |  |  | 10 |  |  | (d) |  |  | 30,263 |  |  |  | 26,530 |  |  |  | 36,269 |  |  |  | 30,400 |  |  |  | 62,662 |  |  |  | 93,062 |  |  |  | (849) |  |  | 2012, 2014
Gateway Distribution Center |  |  | 3 |  |  |  |  |  | 2,523 |  |  |  | 5,715 |  |  |  | 4,817 |  |  |  | 3,164 |  |  |  | 9,891 |  |  |  | 13,055 |  |  |  | (2,539) |  |  | 1998, 2012
Granite Hill Dist. Center |  |  | 2 |  |  |  |  |  | 2,959 |  |  |  | 9,344 |  |  |  | 74 |  |  |  | 2,959 |  |  |  | 9,418 |  |  |  | 12,377 |  |  |  | (1,551) |  |  | 2011
Greenwood Industrial |  |  | 3 |  |  |  |  |  | 6,828 |  |  |  | 24,253 |  |  |  | 583 |  |  |  | 6,828 |  |  |  | 24,836 |  |  |  | 31,664 |  |  |  | (3,379) |  |  | 2011
Hampton Central Dist Ctr |  |  | 3 |  |  | (d) |  |  | 8,928 |  |  |  | 28,015 |  |  |  | 64 |  |  |  | 8,928 |  |  |  | 28,079 |  |  |  | 37,007 |  |  |  | (214) |  |  | 2014
IAD Cargo Center 5 |  |  | 1 |  |  |  |  |  | - |  |  |  | 43,060 |  |  |  | 75 |  |  |  | - |  |  |  | 43,135 |  |  |  | 43,135 |  |  |  | (25,257) |  |  | 2011
Meadowridge Distribution Center |  |  | 3 |  |  | (d) |  |  | 7,827 |  |  |  | 18,990 |  |  |  | 6,527 |  |  |  | 7,972 |  |  |  | 25,372 |  |  |  | 33,344 |  |  |  | (3,134) |  |  | 1998, 2014
Meadowridge Industrial |  |  | 3 |  |  |  |  |  | 4,845 |  |  |  | 20,576 |  |  |  | 4,091 |  |  |  | 4,845 |  |  |  | 24,667 |  |  |  | 29,512 |  |  |  | (2,769) |  |  | 2011
Patuxent Range Road |  |  | 2 |  |  |  |  |  | 2,281 |  |  |  | 9,638 |  |  |  | 1,243 |  |  |  | 2,281 |  |  |  | 10,881 |  |  |  | 13,162 |  |  |  | (1,472) |  |  | 2011
Preston Court |  |  | 1 |  |  |  |  |  | 2,326 |  |  |  | 10,146 |  |  |  | 202 |  |  |  | 2,326 |  |  |  | 10,348 |  |  |  | 12,674 |  |  |  | (1,372) |  |  | 2011
ProLogis Park - Dulles |  |  | 7 |  |  | (d) |  |  | 16,703 |  |  |  | 36,268 |  |  |  | 576 |  |  |  | 16,703 |  |  |  | 36,844 |  |  |  | 53,547 |  |  |  | (2,189) |  |  | 2012, 2014
Troy Hill Dist Ctr |  |  | 3 |  |  | (d) |  |  | 9,179 |  |  |  | 31,489 |  |  |  | 27 |  |  |  | 9,179 |  |  |  | 31,516 |  |  |  | 40,695 |  |  |  | (1,298) |  |  | 2012, 2014
Baltimore/Washington |  |  | 52 |  |  |  |  |  | 114,346 |  |  |  | 338,106 |  |  |  | 71,977 |  |  |  | 115,309 |  |  |  | 409,120 |  |  |  | 524,429 |  |  |  | (73,179) |  |  |
Boston, Massachusetts |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Boston Industrial |  |  | 4 |  |  |  |  |  | 11,810 |  |  |  | 25,975 |  |  |  | (238 | ) |  |  | 11,810 |  |  |  | 25,737 |  |  |  | 37,547 |  |  |  | (5,254) |  |  | 2011
Boston, Massachusetts |  |  | 4 |  |  |  |  |  | 11,810 |  |  |  | 25,975 |  |  |  | (238 | ) |  |  | 11,810 |  |  |  | 25,737 |  |  |  | 37,547 |  |  |  | (5,254) |  |  |

99

##### Table of Contents

PROLOGIS, INC. AND PROLOGIS, L.P.

SCHEDULE III – REAL ESTATE AND ACCUMULATED DEPRECIATION

DECEMBER 31, 2014

(In thousands of U.S. dollars, as applicable)

|  | No. of Bldgs. |  |  |  |  | Initial Cost to Prologis |  |  | Costs Capitalized Subsequent To Acquisition |  |  | Gross Amounts At Which Carried at December 31, 2014 |  |  | Accumulated Depreciation (c) |  |  | Date of Construction/ Acquisition
Description |  |  | Encum- brances |  | Land |  |  | Building & Improvements |  |  |  | Land |  |  | Building & Improvements |  |  | Total (a,b) |  |  |
Central & Eastern, Pennsylvania |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Carlisle Dist Ctr |  |  | 6 |  |  | (d) |  |  | 54,852 |  |  |  | 233,619 |  |  |  | 6,048 |  |  |  | 54,852 |  |  |  | 239,667 |  |  |  | 294,519 |  |  |  | (15,392) |  |  | 2012, 2013
Chambersburg Dist Ctr |  |  | 1 |  |  |  |  |  | 4,188 |  |  |  | 17,796 |  |  |  | 76 |  |  |  | 4,188 |  |  |  | 17,872 |  |  |  | 22,060 |  |  |  | (924) |  |  | 2013
Harrisburg Distribution Center |  |  | 5 |  |  |  |  |  | 21,950 |  |  |  | 96,007 |  |  |  | 1,946 |  |  |  | 21,950 |  |  |  | 97,953 |  |  |  | 119,903 |  |  |  | (9,168) |  |  | 2004, 2013
Harrisburg Industrial Center |  |  | 1 |  |  |  |  |  | 782 |  |  |  | 6,190 |  |  |  | 1,581 |  |  |  | 782 |  |  |  | 7,771 |  |  |  | 8,553 |  |  |  | (2,461) |  |  | 2002
I-78 Dist. Center |  |  | 1 |  |  |  |  |  | 13,030 |  |  |  | 30,007 |  |  |  | 335 |  |  |  | 13,030 |  |  |  | 30,342 |  |  |  | 43,372 |  |  |  | (3,655) |  |  | 2011
I-81 Distribution |  |  | 1 |  |  |  |  |  | 1,822 |  |  |  | 21,583 |  |  |  | 328 |  |  |  | 1,822 |  |  |  | 21,911 |  |  |  | 23,733 |  |  |  | (2,575) |  |  | 2011
Kraft Distribution Center |  |  | 1 |  |  |  |  |  | 7,450 |  |  |  | 23,863 |  |  |  | - |  |  |  | 7,450 |  |  |  | 23,863 |  |  |  | 31,313 |  |  |  | (187) |  |  | 2014
Lehigh Valley Distribution Center |  |  | 8 |  |  | (d) |  |  | 26,795 |  |  |  | 89,400 |  |  |  | 24,540 |  |  |  | 26,875 |  |  |  | 113,860 |  |  |  | 140,735 |  |  |  | (7,994) |  |  | 2004, 2010, 2013, 2014
Northport Ind Ctr |  |  | 1 |  |  | (d) |  |  | 12,282 |  |  |  | 39,621 |  |  |  | 1 |  |  |  | 12,282 |  |  |  | 39,622 |  |  |  | 51,904 |  |  |  | (314) |  |  | 2014
Park 33 Distribution Center |  |  | 2 |  |  |  |  |  | 28,947 |  |  |  | 49,500 |  |  |  | 41,138 |  |  |  | 31,207 |  |  |  | 88,378 |  |  |  | 119,585 |  |  |  | (6,061) |  |  | 2007, 2014
PHL Cargo Center C2 |  |  | 1 |  |  |  |  |  | - |  |  |  | 11,966 |  |  |  | 25 |  |  |  | - |  |  |  | 11,991 |  |  |  | 11,991 |  |  |  | (4,327) |  |  | 2011
Pottsville Dist Ctr |  |  | 1 |  |  |  |  |  | 4,486 |  |  |  | 19,527 |  |  |  | 907 |  |  |  | 4,486 |  |  |  | 20,434 |  |  |  | 24,920 |  |  |  | (2,249) |  |  | 2012
Quakertown Distribution Center |  |  | 1 |  |  |  |  |  | 6,966 |  |  |  | - |  |  |  | 27,698 |  |  |  | 6,966 |  |  |  | 27,698 |  |  |  | 34,664 |  |  |  | (5,960) |  |  | 2006
Central & Eastern, Pennsylvania |  |  | 30 |  |  |  |  |  | 183,550 |  |  |  | 639,079 |  |  |  | 104,623 |  |  |  | 185,890 |  |  |  | 741,362 |  |  |  | 927,252 |  |  |  | (61,267) |  |  |
Central Valley, CA |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Arch Road Logistics Center |  |  | 2 |  |  | (d) |  |  | 9,492 |  |  |  | 38,060 |  |  |  | 2,310 |  |  |  | 9,492 |  |  |  | 40,370 |  |  |  | 49,862 |  |  |  | (5,680) |  |  | 2010
Central Valley Distribution Center |  |  | 3 |  |  | (d) |  |  | 5,339 |  |  |  | 32,838 |  |  |  | 526 |  |  |  | 5,339 |  |  |  | 33,364 |  |  |  | 38,703 |  |  |  | (266) |  |  | 2014
Central Valley Industrial Center |  |  | 5 |  |  | (d) |  |  | 14,110 |  |  |  | 65,026 |  |  |  | 8,648 |  |  |  | 14,560 |  |  |  | 73,224 |  |  |  | 87,784 |  |  |  | (25,728) |  |  | 1999, 2002, 2005, 2014
Chabot Commerce Ctr |  |  | 2 |  |  |  |  |  | 5,222 |  |  |  | 13,697 |  |  |  | 6,601 |  |  |  | 5,222 |  |  |  | 20,298 |  |  |  | 25,520 |  |  |  | (3,516) |  |  | 2011
Duck Creek Dist Ctr |  |  | 1 |  |  | (d) |  |  | 6,690 |  |  |  | 39,683 |  |  |  | - |  |  |  | 6,690 |  |  |  | 39,683 |  |  |  | 46,373 |  |  |  | (300) |  |  | 2014
Manteca Distribution Center |  |  | 1 |  |  |  |  |  | 9,280 |  |  |  | 27,840 |  |  |  | 591 |  |  |  | 9,480 |  |  |  | 28,231 |  |  |  | 37,711 |  |  |  | (8,733) |  |  | 2005
Patterson Pass Business Center |  |  | 4 |  |  | (d) |  |  | 10,004 |  |  |  | 27,878 |  |  |  | 7,397 |  |  |  | 10,017 |  |  |  | 35,262 |  |  |  | 45,279 |  |  |  | (3,868) |  |  | 2007, 2012, 2014
Tracy Dist Ctr |  |  | 1 |  |  | (d) |  |  | 2,056 |  |  |  | 12,248 |  |  |  | - |  |  |  | 2,056 |  |  |  | 12,248 |  |  |  | 14,304 |  |  |  | (93) |  |  | 2014
Tracy II Distribution Center |  |  | 5 |  |  |  |  |  | 23,905 |  |  |  | 32,080 |  |  |  | 152,468 |  |  |  | 29,246 |  |  |  | 179,207 |  |  |  | 208,453 |  |  |  | (19,640) |  |  | 2007, 2009, 2012, 2013
Central Valley, CA |  |  | 24 |  |  |  |  |  | 86,098 |  |  |  | 289,350 |  |  |  | 178,541 |  |  |  | 92,102 |  |  |  | 461,887 |  |  |  | 553,989 |  |  |  | (67,824) |  |  |
Charlotte, North Carolina |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Charlotte Distribution Center |  |  | 11 |  |  | (d) |  |  | 6,596 |  |  |  | 8,581 |  |  |  | 28,810 |  |  |  | 8,114 |  |  |  | 35,873 |  |  |  | 43,987 |  |  |  | (15,719) |  |  | 1995, 1996, 1997, 1998, 2014
Northpark Distribution Center |  |  | 2 |  |  | (d) |  |  | 1,183 |  |  |  | 6,707 |  |  |  | 2,919 |  |  |  | 1,184 |  |  |  | 9,625 |  |  |  | 10,809 |  |  |  | (6,353) |  |  | 1994, 1998
West Pointe Business Center |  |  | 5 |  |  | (d) |  |  | 12,138 |  |  |  | 40,423 |  |  |  | 9,893 |  |  |  | 12,138 |  |  |  | 50,316 |  |  |  | 62,454 |  |  |  | (4,220) |  |  | 2006, 2012, 2014
Charlotte, North Carolina |  |  | 18 |  |  |  |  |  | 19,917 |  |  |  | 55,711 |  |  |  | 41,622 |  |  |  | 21,436 |  |  |  | 95,814 |  |  |  | 117,250 |  |  |  | (26,292) |  |  |
Chicago, Illinois |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Addison Business Center |  |  | 1 |  |  |  |  |  | 1,293 |  |  |  | 2,907 |  |  |  | 515 |  |  |  | 1,293 |  |  |  | 3,422 |  |  |  | 4,715 |  |  |  | (488) |  |  | 2011
Addison Distribution Center |  |  | 1 |  |  |  |  |  | 640 |  |  |  | 3,661 |  |  |  | 1,834 |  |  |  | 640 |  |  |  | 5,495 |  |  |  | 6,135 |  |  |  | (3,037) |  |  | 1997
Alsip Distribution Center |  |  | 1 |  |  |  |  |  | 1,416 |  |  |  | 9,009 |  |  |  | 9,086 |  |  |  | 1,724 |  |  |  | 17,787 |  |  |  | 19,511 |  |  |  | (12,168) |  |  | 1997
Alsip Industrial |  |  | 1 |  |  |  |  |  | 1,422 |  |  |  | 2,336 |  |  |  | 22 |  |  |  | 1,422 |  |  |  | 2,358 |  |  |  | 3,780 |  |  |  | (670) |  |  | 2011
Arlington Heights Distribution Center |  |  | 1 |  |  |  |  |  | 831 |  |  |  | 3,326 |  |  |  | 2,345 |  |  |  | 831 |  |  |  | 5,671 |  |  |  | 6,502 |  |  |  | (1,582) |  |  | 2006
Bensenville Distribution Center |  |  | 1 |  |  |  |  |  | 926 |  |  |  | 3,842 |  |  |  | 6,319 |  |  |  | 940 |  |  |  | 10,147 |  |  |  | 11,087 |  |  |  | (7,198) |  |  | 1997
Bensenville Ind Park |  |  | 13 |  |  |  |  |  | 37,681 |  |  |  | 92,909 |  |  |  | 5,219 |  |  |  | 37,681 |  |  |  | 98,128 |  |  |  | 135,809 |  |  |  | (14,800) |  |  | 2011
Bloomingdale 100 Business Center |  |  | 4 |  |  | (d) |  |  | 6,563 |  |  |  | 27,579 |  |  |  | 68 |  |  |  | 6,563 |  |  |  | 27,647 |  |  |  | 34,210 |  |  |  | (210) |  |  | 2014
Bolingbrook Distribution Center |  |  | 6 |  |  | (d) |  |  | 19,068 |  |  |  | 85,317 |  |  |  | 5,355 |  |  |  | 19,068 |  |  |  | 90,672 |  |  |  | 109,740 |  |  |  | (27,639) |  |  | 1999, 2006, 2014
Bridgeview Dist Ctr |  |  | 4 |  |  | (d) |  |  | 1,662 |  |  |  | 7,726 |  |  |  | - |  |  |  | 1,662 |  |  |  | 7,726 |  |  |  | 9,388 |  |  |  | (92) |  |  | 2014
Bridgeview Industrial |  |  | 1 |  |  |  |  |  | 1,380 |  |  |  | 3,404 |  |  |  | 404 |  |  |  | 1,380 |  |  |  | 3,808 |  |  |  | 5,188 |  |  |  | (616) |  |  | 2011
Chicago Industrial Portfolio |  |  | 1 |  |  |  |  |  | 1,330 |  |  |  | 2,876 |  |  |  | 423 |  |  |  | 1,330 |  |  |  | 3,299 |  |  |  | 4,629 |  |  |  | (561) |  |  | 2011
Des Plaines Distribution Center |  |  | 3 |  |  |  |  |  | 2,158 |  |  |  | 12,232 |  |  |  | 6,884 |  |  |  | 2,159 |  |  |  | 19,115 |  |  |  | 21,274 |  |  |  | (12,660) |  |  | 1995, 1996
Elk Grove Distribution Center |  |  | 20 |  |  | (d) |  |  | 30,227 |  |  |  | 78,013 |  |  |  | 49,831 |  |  |  | 30,227 |  |  |  | 127,844 |  |  |  | 158,071 |  |  |  | (50,971) |  |  | 1995, 1996, 1997, 1999, 2006, 2009
Elk Grove Du Page |  |  | 21 |  |  | (d) |  |  | 14,830 |  |  |  | 64,408 |  |  |  | 10,528 |  |  |  | 14,830 |  |  |  | 74,936 |  |  |  | 89,766 |  |  |  | (8,108) |  |  | 2012
Elk Grove Village SG |  |  | 6 |  |  |  |  |  | 6,367 |  |  |  | 12,010 |  |  |  | 859 |  |  |  | 6,367 |  |  |  | 12,869 |  |  |  | 19,236 |  |  |  | (2,314) |  |  | 2011
Elmhurst Distribution Center |  |  | 1 |  |  |  |  |  | 713 |  |  |  | 4,043 |  |  |  | 1,240 |  |  |  | 713 |  |  |  | 5,283 |  |  |  | 5,996 |  |  |  | (3,345) |  |  | 1997
Executive Drive |  |  | 1 |  |  |  |  |  | 1,371 |  |  |  | 6,430 |  |  |  | 509 |  |  |  | 1,371 |  |  |  | 6,939 |  |  |  | 8,310 |  |  |  | (887) |  |  | 2011
Glendale Heights Distribution Center |  |  | 3 |  |  | (d) |  |  | 3,903 |  |  |  | 22,119 |  |  |  | 4,423 |  |  |  | 3,903 |  |  |  | 26,542 |  |  |  | 30,445 |  |  |  | (14,410) |  |  | 1999
Gurnee Dist Ctr |  |  | 2 |  |  |  |  |  | 2,297 |  |  |  | 9,991 |  |  |  | - |  |  |  | 2,297 |  |  |  | 9,991 |  |  |  | 12,288 |  |  |  | (97) |  |  | 2014
Hintz Building |  |  | 1 |  |  |  |  |  | 354 |  |  |  | 1,970 |  |  |  | 103 |  |  |  | 354 |  |  |  | 2,073 |  |  |  | 2,427 |  |  |  | (289) |  |  | 2011
I-294 Dist Ctr |  |  | 3 |  |  | (d) |  |  | 7,922 |  |  |  | 33,730 |  |  |  | 15 |  |  |  | 7,922 |  |  |  | 33,745 |  |  |  | 41,667 |  |  |  | (1,929) |  |  | 2012, 2014
I-55 Distribution Center |  |  | 2 |  |  | (d) |  |  | 5,383 |  |  |  | 25,504 |  |  |  | 35,513 |  |  |  | 11,786 |  |  |  | 54,614 |  |  |  | 66,400 |  |  |  | (14,082) |  |  | 2007
I-80 Morris |  |  | 1 |  |  |  |  |  | 6,349 |  |  |  | 27,134 |  |  |  | - |  |  |  | 6,349 |  |  |  | 27,134 |  |  |  | 33,483 |  |  |  | (213) |  |  | 2014
Itasca Distribution Center |  |  | 2 |  |  | (d) |  |  | 1,522 |  |  |  | 7,119 |  |  |  | 1,562 |  |  |  | 1,522 |  |  |  | 8,681 |  |  |  | 10,203 |  |  |  | (1,968) |  |  | 1996, 2014
Itasca Industrial Portfolio |  |  | 3 |  |  |  |  |  | 3,053 |  |  |  | 5,879 |  |  |  | 245 |  |  |  | 3,053 |  |  |  | 6,124 |  |  |  | 9,177 |  |  |  | (938) |  |  | 2011
Kehoe Industrial |  |  | 1 |  |  |  |  |  | 1,394 |  |  |  | 3,247 |  |  |  | 446 |  |  |  | 1,394 |  |  |  | 3,693 |  |  |  | 5,087 |  |  |  | (459) |  |  | 2011
Melrose Park Distribution Ctr. |  |  | 1 |  |  |  |  |  | 2,657 |  |  |  | 9,292 |  |  |  | 283 |  |  |  | 2,657 |  |  |  | 9,575 |  |  |  | 12,232 |  |  |  | (1,584) |  |  | 2011
Minooka Distribution Center |  |  | 3 |  |  | (d) |  |  | 18,420 |  |  |  | 68,912 |  |  |  | 17,991 |  |  |  | 19,404 |  |  |  | 85,919 |  |  |  | 105,323 |  |  |  | (16,871) |  |  | 2005, 2008, 2014
Mitchell Distribution Center |  |  | 1 |  |  |  |  |  | 1,236 |  |  |  | 7,004 |  |  |  | 3,748 |  |  |  | 1,236 |  |  |  | 10,752 |  |  |  | 11,988 |  |  |  | (6,970) |  |  | 1996
NDP - Chicago |  |  | 1 |  |  |  |  |  | 461 |  |  |  | 1,362 |  |  |  | 27 |  |  |  | 461 |  |  |  | 1,389 |  |  |  | 1,850 |  |  |  | (183) |  |  | 2011
Nicholas Logistics Center |  |  | 1 |  |  |  |  |  | 2,354 |  |  |  | 10,799 |  |  |  | 44 |  |  |  | 2,354 |  |  |  | 10,843 |  |  |  | 13,197 |  |  |  | (1,744) |  |  | 2011

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##### Table of Contents

PROLOGIS, INC. AND PROLOGIS, L.P.

SCHEDULE III – REAL ESTATE AND ACCUMULATED DEPRECIATION

DECEMBER 31, 2014

(In thousands of U.S. dollars, as applicable)

|  | No. of Bldgs. |  |  |  |  | Initial Cost to Prologis |  |  | Costs Capitalized Subsequent To Acquisition |  |  | Gross Amounts At Which Carried at December 31, 2014 |  |  | Accumulated Depreciation (c) |  |  | Date of Construction/ Acquisition
Description |  |  | Encum- brances |  | Land |  |  | Building & Improvements |  |  |  | Land |  |  | Building & Improvements |  |  | Total (a,b) |  |  |
Northbrook Distribution Center |  |  | 1 |  |  |  |  |  | 2,056 |  |  |  | 8,227 |  |  |  | 1,981 |  |  |  | 2,056 |  |  |  | 10,208 |  |  |  | 12,264 |  |  |  | (2,340) |  |  | 2007
Northlake Distribution Center |  |  | 1 |  |  |  |  |  | 372 |  |  |  | 2,105 |  |  |  | 800 |  |  |  | 372 |  |  |  | 2,905 |  |  |  | 3,277 |  |  |  | (2,005) |  |  | 1996
OHare Industrial Portfolio |  |  | 6 |  |  |  |  |  | 4,126 |  |  |  | 10,096 |  |  |  | 137 |  |  |  | 4,126 |  |  |  | 10,233 |  |  |  | 14,359 |  |  |  | (1,766) |  |  | 2011
Pleasant Prairie Distribution Center |  |  | 1 |  |  |  |  |  | 1,314 |  |  |  | 7,450 |  |  |  | 2,733 |  |  |  | 1,315 |  |  |  | 10,182 |  |  |  | 11,497 |  |  |  | (6,008) |  |  | 1999
Poplar Gateway Truck Terminal |  |  | 1 |  |  |  |  |  | 2,321 |  |  |  | 4,699 |  |  |  | 519 |  |  |  | 2,321 |  |  |  | 5,218 |  |  |  | 7,539 |  |  |  | (725) |  |  | 2011
Port OHare |  |  | 2 |  |  |  |  |  | 4,819 |  |  |  | 5,547 |  |  |  | 256 |  |  |  | 4,819 |  |  |  | 5,803 |  |  |  | 10,622 |  |  |  | (971) |  |  | 2011
Remington Lakes Dist |  |  | 1 |  |  |  |  |  | 2,382 |  |  |  | 11,657 |  |  |  | 606 |  |  |  | 2,382 |  |  |  | 12,263 |  |  |  | 14,645 |  |  |  | (1,380) |  |  | 2011
Rochelle Distribution Center |  |  | 1 |  |  |  |  |  | 4,457 |  |  |  | 20,100 |  |  |  | 11,131 |  |  |  | 5,254 |  |  |  | 30,434 |  |  |  | 35,688 |  |  |  | (4,789) |  |  | 2008
Romeoville Distribution Center |  |  | 5 |  |  | (d) |  |  | 23,325 |  |  |  | 94,197 |  |  |  | 10,129 |  |  |  | 23,325 |  |  |  | 104,326 |  |  |  | 127,651 |  |  |  | (31,396) |  |  | 1999, 2005
S.C. Johnson & Son |  |  | 1 |  |  |  |  |  | 2,267 |  |  |  | 15,911 |  |  |  | 1,552 |  |  |  | 3,152 |  |  |  | 16,578 |  |  |  | 19,730 |  |  |  | (3,156) |  |  | 2008
Sivert Distribution |  |  | 1 |  |  |  |  |  | 1,497 |  |  |  | 1,470 |  |  |  | 8 |  |  |  | 1,497 |  |  |  | 1,478 |  |  |  | 2,975 |  |  |  | (236) |  |  | 2011
Touhy Cargo Terminal |  |  | 1 |  |  |  |  |  | 2,697 |  |  |  | 8,909 |  |  |  | - |  |  |  | 2,697 |  |  |  | 8,909 |  |  |  | 11,606 |  |  |  | (970) |  |  | 2011
Waukegan Distribution Center |  |  | 2 |  |  |  |  |  | 4,368 |  |  |  | 17,632 |  |  |  | 1,075 |  |  |  | 4,368 |  |  |  | 18,707 |  |  |  | 23,075 |  |  |  | (5,232) |  |  | 2007
West Chicago Distribution Center |  |  | 1 |  |  |  |  |  | 3,125 |  |  |  | 12,499 |  |  |  | 3,299 |  |  |  | 3,125 |  |  |  | 15,798 |  |  |  | 18,923 |  |  |  | (4,622) |  |  | 2005
Windsor Court |  |  | 1 |  |  |  |  |  | 635 |  |  |  | 3,493 |  |  |  | 184 |  |  |  | 635 |  |  |  | 3,677 |  |  |  | 4,312 |  |  |  | (555) |  |  | 2011
Wood Dale Industrial SG |  |  | 5 |  |  |  |  |  | 4,343 |  |  |  | 10,174 |  |  |  | 717 |  |  |  | 4,343 |  |  |  | 10,891 |  |  |  | 15,234 |  |  |  | (1,548) |  |  | 2011
Woodale Distribution Center |  |  | 1 |  |  |  |  |  | 263 |  |  |  | 1,490 |  |  |  | 589 |  |  |  | 263 |  |  |  | 2,079 |  |  |  | 2,342 |  |  |  | (1,313) |  |  | 1997
Woodridge Distribution Center |  |  | 14 |  |  | (d) |  |  | 46,575 |  |  |  | 197,289 |  |  |  | 21,583 |  |  |  | 49,942 |  |  |  | 215,505 |  |  |  | 265,447 |  |  |  | (65,513) |  |  | 2005, 2007
Yohan Industrial |  |  | 3 |  |  |  |  |  | 4,219 |  |  |  | 12,306 |  |  |  | 1,157 |  |  |  | 4,219 |  |  |  | 13,463 |  |  |  | 17,682 |  |  |  | (1,768) |  |  | 2011
Chicago, Illinois |  |  | 161 |  |  |  |  |  | 302,344 |  |  |  | 1,101,341 |  |  |  | 224,297 |  |  |  | 315,104 |  |  |  | 1,312,878 |  |  |  | 1,627,982 |  |  |  | (345,376) |  |  |
Cincinnati, Ohio |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Airpark Distribution Center |  |  | 4 |  |  | (d) |  |  | 5,851 |  |  |  | 22,543 |  |  |  | 14,311 |  |  |  | 6,831 |  |  |  | 35,874 |  |  |  | 42,705 |  |  |  | (7,717) |  |  | 1996, 2012, 2014
DAY Cargo Center |  |  | 5 |  |  |  |  |  | - |  |  |  | 4,749 |  |  |  | 531 |  |  |  | - |  |  |  | 5,280 |  |  |  | 5,280 |  |  |  | (1,480) |  |  | 2011
Fairfield Comm Ctr |  |  | 1 |  |  | (d) |  |  | 2,526 |  |  |  | 10,864 |  |  |  | 29 |  |  |  | 2,526 |  |  |  | 10,893 |  |  |  | 13,419 |  |  |  | (86) |  |  | 2014
Monroe Park |  |  | 1 |  |  | (d) |  |  | 7,222 |  |  |  | 30,988 |  |  |  | 301 |  |  |  | 7,222 |  |  |  | 31,289 |  |  |  | 38,511 |  |  |  | (244) |  |  | 2014
Mosteller Dist Ctr |  |  | 1 |  |  | (d) |  |  | 921 |  |  |  | 4,192 |  |  |  | 28 |  |  |  | 921 |  |  |  | 4,220 |  |  |  | 5,141 |  |  |  | (40) |  |  | 2014
Park I-275 |  |  | 4 |  |  | (d) |  |  | 15,939 |  |  |  | 63,846 |  |  |  | 3,153 |  |  |  | 15,939 |  |  |  | 66,999 |  |  |  | 82,938 |  |  |  | (4,261) |  |  | 2008, 2012, 2014
Sharonville Distribution Center |  |  | 2 |  |  | (d) |  |  | 1,202 |  |  |  | - |  |  |  | 15,047 |  |  |  | 2,424 |  |  |  | 13,825 |  |  |  | 16,249 |  |  |  | (6,391) |  |  | 1997
West Chester Comm Park I |  |  | 5 |  |  | (d) |  |  | 9,466 |  |  |  | 39,950 |  |  |  | 2,356 |  |  |  | 9,466 |  |  |  | 42,306 |  |  |  | 51,772 |  |  |  | (1,193) |  |  | 2012, 2014
Cincinnati, Ohio |  |  | 23 |  |  |  |  |  | 43,127 |  |  |  | 177,132 |  |  |  | 35,756 |  |  |  | 45,329 |  |  |  | 210,686 |  |  |  | 256,015 |  |  |  | (21,412) |  |  |
Columbus, Ohio |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Alum Creek Dist Ctr |  |  | 1 |  |  |  |  |  | 917 |  |  |  | 4,584 |  |  |  | 277 |  |  |  | 917 |  |  |  | 4,861 |  |  |  | 5,778 |  |  |  | (659) |  |  | 2012
Brookham Distribution Center |  |  | 2 |  |  |  |  |  | 5,964 |  |  |  | 23,858 |  |  |  | 4,946 |  |  |  | 5,965 |  |  |  | 28,803 |  |  |  | 34,768 |  |  |  | (10,113) |  |  | 2005
Canal Pointe Distribution Center |  |  | 1 |  |  |  |  |  | 1,237 |  |  |  | 7,013 |  |  |  | 1,728 |  |  |  | 1,280 |  |  |  | 8,698 |  |  |  | 9,978 |  |  |  | (4,572) |  |  | 1999
Capital Park South Distribution Center |  |  | 8 |  |  | (d) |  |  | 10,077 |  |  |  | 40,234 |  |  |  | 29,285 |  |  |  | 10,470 |  |  |  | 69,126 |  |  |  | 79,596 |  |  |  | (18,495) |  |  | 1996, 2012, 2014
Columbus West Ind Ctr |  |  | 1 |  |  | (d) |  |  | 427 |  |  |  | 2,600 |  |  |  | - |  |  |  | 427 |  |  |  | 2,600 |  |  |  | 3,027 |  |  |  | (29) |  |  | 2014
Corporate Park West |  |  | 2 |  |  | (d) |  |  | 994 |  |  |  | 6,150 |  |  |  | 1,409 |  |  |  | 994 |  |  |  | 7,559 |  |  |  | 8,553 |  |  |  | (2,494) |  |  | 1996, 2014
Crosswinds Dist Ctr |  |  | 1 |  |  | (d) |  |  | 3,058 |  |  |  | 19,240 |  |  |  | - |  |  |  | 3,058 |  |  |  | 19,240 |  |  |  | 22,298 |  |  |  | (162) |  |  | 2014
Etna Distribution Center |  |  | 4 |  |  | (d) |  |  | 10,789 |  |  |  | 35,577 |  |  |  | 42,552 |  |  |  | 10,789 |  |  |  | 78,129 |  |  |  | 88,918 |  |  |  | (5,941) |  |  | 2007, 2013, 2014
International Street Comm Ctr |  |  | 2 |  |  |  |  |  | 1,503 |  |  |  | 6,356 |  |  |  | 383 |  |  |  | 1,503 |  |  |  | 6,739 |  |  |  | 8,242 |  |  |  | (735) |  |  | 2012
Lockbourne Dist Ctr |  |  | 1 |  |  |  |  |  | 540 |  |  |  | 3,030 |  |  |  | 352 |  |  |  | 540 |  |  |  | 3,382 |  |  |  | 3,922 |  |  |  | (575) |  |  | 2012
South Park Distribution Center |  |  | 2 |  |  | (d) |  |  | 3,343 |  |  |  | 15,182 |  |  |  | 3,370 |  |  |  | 3,343 |  |  |  | 18,552 |  |  |  | 21,895 |  |  |  | (7,766) |  |  | 1999, 2005
Westpointe Distribution Center |  |  | 2 |  |  |  |  |  | 1,446 |  |  |  | 7,601 |  |  |  | 1,298 |  |  |  | 1,446 |  |  |  | 8,899 |  |  |  | 10,345 |  |  |  | (3,474) |  |  | 2007
Columbus, Ohio |  |  | 27 |  |  |  |  |  | 40,295 |  |  |  | 171,425 |  |  |  | 85,600 |  |  |  | 40,732 |  |  |  | 256,588 |  |  |  | 297,320 |  |  |  | (55,015) |  |  |
Dallas/Fort Worth, Texas |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Arlington Corp Ctr |  |  | 3 |  |  | (d) |  |  | 6,509 |  |  |  | 28,032 |  |  |  | 125 |  |  |  | 6,509 |  |  |  | 28,157 |  |  |  | 34,666 |  |  |  | (1,268) |  |  | 2012, 2014
Dallas Corporate Center |  |  | 11 |  |  | (d) |  |  | 6,449 |  |  |  | 5,441 |  |  |  | 34,632 |  |  |  | 6,645 |  |  |  | 39,877 |  |  |  | 46,522 |  |  |  | (18,407) |  |  | 1996, 1997, 1998, 1999, 2012
Dallas Industrial |  |  | 12 |  |  |  |  |  | 7,180 |  |  |  | 26,514 |  |  |  | 2,682 |  |  |  | 7,180 |  |  |  | 29,196 |  |  |  | 36,376 |  |  |  | (4,290) |  |  | 2011
DFW Cargo Center 1 |  |  | 1 |  |  |  |  |  | - |  |  |  | 35,117 |  |  |  | 973 |  |  |  | - |  |  |  | 36,090 |  |  |  | 36,090 |  |  |  | (5,105) |  |  | 2011
DFW Cargo Center 2 |  |  | 1 |  |  |  |  |  | - |  |  |  | 27,916 |  |  |  | 200 |  |  |  | - |  |  |  | 28,116 |  |  |  | 28,116 |  |  |  | (3,849) |  |  | 2011
DFW Cargo Center East |  |  | 3 |  |  |  |  |  | - |  |  |  | 19,730 |  |  |  | 333 |  |  |  | - |  |  |  | 20,063 |  |  |  | 20,063 |  |  |  | (4,469) |  |  | 2011
Flower Mound Distribution Center |  |  | 1 |  |  | (d) |  |  | 5,157 |  |  |  | 20,991 |  |  |  | 2,470 |  |  |  | 5,157 |  |  |  | 23,461 |  |  |  | 28,618 |  |  |  | (6,250) |  |  | 2007
Freeport Corp Ctr |  |  | 5 |  |  | (d) |  |  | 15,415 |  |  |  | 65,273 |  |  |  | 702 |  |  |  | 15,415 |  |  |  | 65,975 |  |  |  | 81,390 |  |  |  | (4,424) |  |  | 2012, 2014
Freeport Distribution Center |  |  | 4 |  |  |  |  |  | 1,393 |  |  |  | 5,549 |  |  |  | 5,947 |  |  |  | 1,440 |  |  |  | 11,449 |  |  |  | 12,889 |  |  |  | (6,427) |  |  | 1996, 1997, 1998
Great Southwest Corp Ctr |  |  | 3 |  |  |  |  |  | 4,476 |  |  |  | 19,302 |  |  |  | 210 |  |  |  | 4,476 |  |  |  | 19,512 |  |  |  | 23,988 |  |  |  | (153) |  |  | 2014
Great Southwest Distribution Center |  |  | 24 |  |  | (d) |  |  | 38,395 |  |  |  | 160,253 |  |  |  | 25,811 |  |  |  | 38,395 |  |  |  | 186,064 |  |  |  | 224,459 |  |  |  | (58,819) |  |  | 1995, 1996, 1997, 1999, 2000, 2001, 2002, 2005, 2012, 2014
Greater Dallas Industrial Port |  |  | 3 |  |  |  |  |  | 3,525 |  |  |  | 16,375 |  |  |  | 967 |  |  |  | 3,525 |  |  |  | 17,342 |  |  |  | 20,867 |  |  |  | (2,481) |  |  | 2011
Lancaster Distribution Center |  |  | 5 |  |  | (d) |  |  | 20,635 |  |  |  | 14,362 |  |  |  | 93,709 |  |  |  | 19,969 |  |  |  | 108,737 |  |  |  | 128,706 |  |  |  | (9,024) |  |  | 2007, 2008, 2013, 2014
Lonestar Portfolio |  |  | 3 |  |  |  |  |  | 4,736 |  |  |  | 13,035 |  |  |  | 2,835 |  |  |  | 4,736 |  |  |  | 15,870 |  |  |  | 20,606 |  |  |  | (2,374) |  |  | 2011
Mesquite Dist Ctr |  |  | 2 |  |  | (d) |  |  | 8,355 |  |  |  | 35,440 |  |  |  | 104 |  |  |  | 8,355 |  |  |  | 35,544 |  |  |  | 43,899 |  |  |  | (1,781) |  |  | 2012, 2014
Mesquite Dist III |  |  | 1 |  |  |  |  |  | 1,691 |  |  |  | - |  |  |  | 11,894 |  |  |  | 1,691 |  |  |  | 11,894 |  |  |  | 13,585 |  |  |  | (564) |  |  | 2013
Northgate Distribution Center |  |  | 10 |  |  | (d) |  |  | 13,001 |  |  |  | 62,680 |  |  |  | 6,772 |  |  |  | 13,488 |  |  |  | 68,965 |  |  |  | 82,453 |  |  |  | (18,380) |  |  | 1999, 2005, 2008, 2012, 2014
Royal Distribution Center |  |  | 1 |  |  |  |  |  | 811 |  |  |  | 4,598 |  |  |  | 2,235 |  |  |  | 811 |  |  |  | 6,833 |  |  |  | 7,644 |  |  |  | (2,725) |  |  | 2001
Stemmons Distribution Center |  |  | 1 |  |  |  |  |  | 272 |  |  |  | 1,544 |  |  |  | 962 |  |  |  | 272 |  |  |  | 2,506 |  |  |  | 2,778 |  |  |  | (1,667) |  |  | 1995

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##### Table of Contents

PROLOGIS, INC. AND PROLOGIS, L.P.

SCHEDULE III – REAL ESTATE AND ACCUMULATED DEPRECIATION

DECEMBER 31, 2014

(In thousands of U.S. dollars, as applicable)

|  | No. of Bldgs. |  |  |  |  | Initial Cost to Prologis |  |  | Costs Capitalized Subsequent To Acquisition |  |  | Gross Amounts At Which Carried at December 31, 2014 |  |  | Accumulated Depreciation (c) |  |  | Date of Construction/ Acquisition
Description |  |  | Encum- brances |  | Land |  |  | Building & Improvements |  |  |  | Land |  |  | Building & Improvements |  |  | Total (a,b) |  |  |
Stemmons Industrial Center |  |  | 8 |  |  |  |  |  | 1,653 |  |  |  | 10,526 |  |  |  | 6,198 |  |  |  | 1,653 |  |  |  | 16,724 |  |  |  | 18,377 |  |  |  | (11,143) |  |  | 1994, 1995, 1996, 1999
Trinity Mills Distribution Center |  |  | 1 |  |  | (d) |  |  | 735 |  |  |  | 3,774 |  |  |  | 1,020 |  |  |  | 735 |  |  |  | 4,794 |  |  |  | 5,529 |  |  |  | (2,535) |  |  | 1999
Valwood Business Center |  |  | 5 |  |  | (d) |  |  | 4,679 |  |  |  | 19,674 |  |  |  | 1,146 |  |  |  | 4,679 |  |  |  | 20,820 |  |  |  | 25,499 |  |  |  | (4,485) |  |  | 2001, 2006, 2014
Valwood Distribution Center |  |  | 5 |  |  | (d) |  |  | 4,742 |  |  |  | 21,498 |  |  |  | 1,289 |  |  |  | 4,742 |  |  |  | 22,787 |  |  |  | 27,529 |  |  |  | (3,179) |  |  | 1999, 2014
Valwood Industrial |  |  | 2 |  |  |  |  |  | 1,802 |  |  |  | 9,658 |  |  |  | 575 |  |  |  | 1,802 |  |  |  | 10,233 |  |  |  | 12,035 |  |  |  | (1,620) |  |  | 2011
Dallas/Fort Worth, Texas |  |  | 115 |  |  |  |  |  | 151,611 |  |  |  | 627,282 |  |  |  | 203,791 |  |  |  | 151,675 |  |  |  | 831,009 |  |  |  | 982,684 |  |  |  | (175,419) |  |  |
Denver, Colorado |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Denver Business Center |  |  | 3 |  |  | (d) |  |  | 3,142 |  |  |  | 13,396 |  |  |  | 775 |  |  |  | 3,142 |  |  |  | 14,171 |  |  |  | 17,313 |  |  |  | (1,312) |  |  | 2012
Havana Dist Ctr |  |  | 1 |  |  | (d) |  |  | 1,421 |  |  |  | 5,958 |  |  |  | 70 |  |  |  | 1,421 |  |  |  | 6,028 |  |  |  | 7,449 |  |  |  | (65) |  |  | 2014
Pagosa Distribution Center |  |  | 1 |  |  | (d) |  |  | 398 |  |  |  | 2,322 |  |  |  | 1,675 |  |  |  | 398 |  |  |  | 3,997 |  |  |  | 4,395 |  |  |  | (2,849) |  |  | 1993
Peoria Dist Ctr |  |  | 2 |  |  | (d) |  |  | 4,129 |  |  |  | 17,465 |  |  |  | 14 |  |  |  | 4,129 |  |  |  | 17,479 |  |  |  | 21,608 |  |  |  | (138) |  |  | 2014
Stapleton Business Center |  |  | 12 |  |  | (d) |  |  | 34,634 |  |  |  | 139,257 |  |  |  | 9,384 |  |  |  | 34,635 |  |  |  | 148,640 |  |  |  | 183,275 |  |  |  | (47,204) |  |  | 2005
Upland Distribution Center |  |  | 6 |  |  | (d) |  |  | 4,064 |  |  |  | 19,844 |  |  |  | 5,335 |  |  |  | 4,077 |  |  |  | 25,166 |  |  |  | 29,243 |  |  |  | (5,414) |  |  | 1994, 1995, 2014
Upland Distribution Center II |  |  | 2 |  |  | (d) |  |  | 1,396 |  |  |  | 5,603 |  |  |  | 2,136 |  |  |  | 1,409 |  |  |  | 7,726 |  |  |  | 9,135 |  |  |  | (2,756) |  |  | 1993, 2014
Denver, Colorado |  |  | 27 |  |  |  |  |  | 49,184 |  |  |  | 203,845 |  |  |  | 19,389 |  |  |  | 49,211 |  |  |  | 223,207 |  |  |  | 272,418 |  |  |  | (59,738) |  |  |
El Paso, Texas |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Vista Corporate Center |  |  | 1 |  |  |  |  |  | 649 |  |  |  | 6,220 |  |  |  | - |  |  |  | 649 |  |  |  | 6,220 |  |  |  | 6,869 |  |  |  | (48) |  |  | 2014
Vista Del Sol Ind Ctr III |  |  | 1 |  |  |  |  |  | 2,040 |  |  |  | 8,840 |  |  |  | 85 |  |  |  | 2,040 |  |  |  | 8,925 |  |  |  | 10,965 |  |  |  | (739) |  |  | 2012
Vista Del Sol Industrial Center II |  |  | 2 |  |  |  |  |  | 366 |  |  |  | - |  |  |  | 7,829 |  |  |  | 796 |  |  |  | 7,399 |  |  |  | 8,195 |  |  |  | (3,931) |  |  | 1997, 1998
El Paso, Texas |  |  | 4 |  |  |  |  |  | 3,055 |  |  |  | 15,060 |  |  |  | 7,914 |  |  |  | 3,485 |  |  |  | 22,544 |  |  |  | 26,029 |  |  |  | (4,718) |  |  |
Houston, Texas |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Blalock Distribution Center |  |  | 3 |  |  | (d) |  |  | 5,032 |  |  |  | 21,983 |  |  |  | 3,178 |  |  |  | 5,031 |  |  |  | 25,162 |  |  |  | 30,193 |  |  |  | (4,540) |  |  | 2002, 2012
Crosstimbers Distribution Center |  |  | 1 |  |  |  |  |  | 359 |  |  |  | 2,035 |  |  |  | 1,284 |  |  |  | 359 |  |  |  | 3,319 |  |  |  | 3,678 |  |  |  | (2,350) |  |  | 1994
IAH Cargo Center 1 |  |  | 1 |  |  |  |  |  | - |  |  |  | 13,267 |  |  |  | 252 |  |  |  | - |  |  |  | 13,519 |  |  |  | 13,519 |  |  |  | (904) |  |  | 2012
Jersey Village Corp Ctr |  |  | 4 |  |  | (d) |  |  | 17,971 |  |  |  | 74,804 |  |  |  | 309 |  |  |  | 17,971 |  |  |  | 75,113 |  |  |  | 93,084 |  |  |  | (4,553) |  |  | 2012, 2014
Kempwood Business Center |  |  | 4 |  |  |  |  |  | 1,746 |  |  |  | 9,894 |  |  |  | 3,504 |  |  |  | 1,746 |  |  |  | 13,398 |  |  |  | 15,144 |  |  |  | (6,763) |  |  | 2001
Northpark Distribution Center |  |  | 10 |  |  | (d) |  |  | 13,003 |  |  |  | 37,428 |  |  |  | 23,729 |  |  |  | 13,003 |  |  |  | 61,157 |  |  |  | 74,160 |  |  |  | (5,023) |  |  | 2006, 2008, 2012, 2013, 2014
Perimeter Distribution Center |  |  | 2 |  |  |  |  |  | 676 |  |  |  | 4,604 |  |  |  | 1,004 |  |  |  | 676 |  |  |  | 5,608 |  |  |  | 6,284 |  |  |  | (2,878) |  |  | 1999
Pine Forest Business Center |  |  | 11 |  |  | (d) |  |  | 6,042 |  |  |  | 28,833 |  |  |  | 8,637 |  |  |  | 6,042 |  |  |  | 37,470 |  |  |  | 43,512 |  |  |  | (15,103) |  |  | 1993, 1995, 2014
Pine North Distribution Center |  |  | 2 |  |  |  |  |  | 847 |  |  |  | 4,800 |  |  |  | 1,203 |  |  |  | 847 |  |  |  | 6,003 |  |  |  | 6,850 |  |  |  | (3,366) |  |  | 1999
Pinemont Distribution Center |  |  | 2 |  |  |  |  |  | 642 |  |  |  | 3,636 |  |  |  | 1,000 |  |  |  | 642 |  |  |  | 4,636 |  |  |  | 5,278 |  |  |  | (2,601) |  |  | 1999
Post Oak Business Center |  |  | 11 |  |  |  |  |  | 2,334 |  |  |  | 11,655 |  |  |  | 9,663 |  |  |  | 2,334 |  |  |  | 21,318 |  |  |  | 23,652 |  |  |  | (14,285) |  |  | 1993, 1994, 1996
Post Oak Distribution Center |  |  | 5 |  |  |  |  |  | 1,522 |  |  |  | 8,758 |  |  |  | 6,107 |  |  |  | 1,522 |  |  |  | 14,865 |  |  |  | 16,387 |  |  |  | (10,719) |  |  | 1993, 1994
South Loop Distribution Center |  |  | 2 |  |  |  |  |  | 418 |  |  |  | 1,943 |  |  |  | 2,213 |  |  |  | 418 |  |  |  | 4,156 |  |  |  | 4,574 |  |  |  | (2,699) |  |  | 1994
Southland Distribution Center |  |  | 2 |  |  |  |  |  | 2,505 |  |  |  | 12,437 |  |  |  | 2,000 |  |  |  | 2,505 |  |  |  | 14,437 |  |  |  | 16,942 |  |  |  | (4,414) |  |  | 2002, 2012
Sugarland Corp Ctr |  |  | 2 |  |  | (d) |  |  | 3,506 |  |  |  | 14,856 |  |  |  | - |  |  |  | 3,506 |  |  |  | 14,856 |  |  |  | 18,362 |  |  |  | (115) |  |  | 2014
West by Northwest Industrial Center |  |  | 9 |  |  | (d) |  |  | 11,316 |  |  |  | 47,649 |  |  |  | 3,713 |  |  |  | 11,456 |  |  |  | 51,222 |  |  |  | 62,678 |  |  |  | (5,342) |  |  | 1993, 1994, 2012, 2014
White Street Distribution Center |  |  | 1 |  |  |  |  |  | 469 |  |  |  | 2,656 |  |  |  | 2,420 |  |  |  | 469 |  |  |  | 5,076 |  |  |  | 5,545 |  |  |  | (3,308) |  |  | 1995
Wingfoot Dist Ctr |  |  | 2 |  |  |  |  |  | 1,976 |  |  |  | 8,606 |  |  |  | 3,436 |  |  |  | 1,976 |  |  |  | 12,042 |  |  |  | 14,018 |  |  |  | (1,226) |  |  | 2012, 2013
World Houston Dist Ctr |  |  | 1 |  |  |  |  |  | 1,529 |  |  |  | 6,326 |  |  |  | 42 |  |  |  | 1,529 |  |  |  | 6,368 |  |  |  | 7,897 |  |  |  | (486) |  |  | 2012
Houston, Texas |  |  | 75 |  |  |  |  |  | 71,893 |  |  |  | 316,170 |  |  |  | 73,694 |  |  |  | 72,032 |  |  |  | 389,725 |  |  |  | 461,757 |  |  |  | (90,675) |  |  |
Indianapolis, Indiana |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Airport Bus Ctr |  |  | 2 |  |  | (d) |  |  | 1,667 |  |  |  | 7,244 |  |  |  | 6 |  |  |  | 1,667 |  |  |  | 7,250 |  |  |  | 8,917 |  |  |  | (58) |  |  | 2014
Airtech Park |  |  | 1 |  |  | (d) |  |  | 7,305 |  |  |  | 31,388 |  |  |  | 1 |  |  |  | 7,305 |  |  |  | 31,389 |  |  |  | 38,694 |  |  |  | (250) |  |  | 2014
Eastside Distribution Center |  |  | 1 |  |  |  |  |  | 228 |  |  |  | 1,187 |  |  |  | 2,068 |  |  |  | 299 |  |  |  | 3,184 |  |  |  | 3,483 |  |  |  | (1,807) |  |  | 1995
North by Northeast Corporate Center |  |  | 1 |  |  |  |  |  | 1,058 |  |  |  | - |  |  |  | 9,157 |  |  |  | 1,059 |  |  |  | 9,156 |  |  |  | 10,215 |  |  |  | (4,848) |  |  | 1995
North Plainfield Park Dist Ctr |  |  | 1 |  |  | (d) |  |  | 8,562 |  |  |  | 36,687 |  |  |  | - |  |  |  | 8,562 |  |  |  | 36,687 |  |  |  | 45,249 |  |  |  | (289) |  |  | 2014
Park 100 Industrial Center |  |  | 17 |  |  | (d) |  |  | 10,410 |  |  |  | 43,048 |  |  |  | 21,491 |  |  |  | 10,410 |  |  |  | 64,539 |  |  |  | 74,949 |  |  |  | (21,704) |  |  | 1995, 2012
Park 267 |  |  | 1 |  |  |  |  |  | 3,705 |  |  |  | 15,695 |  |  |  | - |  |  |  | 3,705 |  |  |  | 15,695 |  |  |  | 19,400 |  |  |  | (122) |  |  | 2014
Shadeland Industrial Center |  |  | 3 |  |  |  |  |  | 428 |  |  |  | 2,431 |  |  |  | 3,150 |  |  |  | 429 |  |  |  | 5,580 |  |  |  | 6,009 |  |  |  | (3,782) |  |  | 1995
Indianapolis, Indiana |  |  | 27 |  |  |  |  |  | 33,363 |  |  |  | 137,680 |  |  |  | 35,873 |  |  |  | 33,436 |  |  |  | 173,480 |  |  |  | 206,916 |  |  |  | (32,860) |  |  |
Jacksonville, Florida |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
JAX Cargo Center |  |  | 1 |  |  |  |  |  | - |  |  |  | 2,892 |  |  |  | 176 |  |  |  | - |  |  |  | 3,068 |  |  |  | 3,068 |  |  |  | (894) |  |  | 2011
Jacksonville, Florida |  |  | 1 |  |  |  |  |  | - |  |  |  | 2,892 |  |  |  | 176 |  |  |  | - |  |  |  | 3,068 |  |  |  | 3,068 |  |  |  | (894) |  |  |
Kansas City, Kansas |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
MCI Cargo Center 1 |  |  | 1 |  |  |  |  |  | - |  |  |  | 2,781 |  |  |  | 11 |  |  |  | - |  |  |  | 2,792 |  |  |  | 2,792 |  |  |  | (1,297) |  |  | 2011
MCI Cargo Center 2 |  |  | 1 |  |  |  |  |  | - |  |  |  | 11,630 |  |  |  | - |  |  |  | - |  |  |  | 11,630 |  |  |  | 11,630 |  |  |  | (2,557) |  |  | 2011
Kansas City, Kansas |  |  | 2 |  |  |  |  |  | - |  |  |  | 14,411 |  |  |  | 11 |  |  |  | - |  |  |  | 14,422 |  |  |  | 14,422 |  |  |  | (3,854) |  |  |
Las Vegas, Nevada |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Black Mountain Distribution Center |  |  | 2 |  |  |  |  |  | 1,108 |  |  |  | - |  |  |  | 8,022 |  |  |  | 1,206 |  |  |  | 7,924 |  |  |  | 9,130 |  |  |  | (3,972) |  |  | 1997
Cameron Business Center |  |  | 1 |  |  |  |  |  | 1,634 |  |  |  | 9,255 |  |  |  | 1,580 |  |  |  | 1,634 |  |  |  | 10,835 |  |  |  | 12,469 |  |  |  | (5,332) |  |  | 1999
Las Vegas Corporate Center |  |  | 3 |  |  | (d) |  |  | 7,800 |  |  |  | 32,899 |  |  |  | - |  |  |  | 7,800 |  |  |  | 32,899 |  |  |  | 40,699 |  |  |  | (251) |  |  | 2014
Sunrise Ind Park |  |  | 9 |  |  |  |  |  | 21,369 |  |  |  | 92,503 |  |  |  | 2,578 |  |  |  | 21,369 |  |  |  | 95,081 |  |  |  | 116,450 |  |  |  | (5,132) |  |  | 2011, 2013, 2014
West One Business Center |  |  | 4 |  |  |  |  |  | 2,468 |  |  |  | 13,985 |  |  |  | 5,261 |  |  |  | 2,468 |  |  |  | 19,246 |  |  |  | 21,714 |  |  |  | (11,475) |  |  | 1996
Las Vegas, Nevada |  |  | 19 |  |  |  |  |  | 34,379 |  |  |  | 148,642 |  |  |  | 17,441 |  |  |  | 34,477 |  |  |  | 165,985 |  |  |  | 200,462 |  |  |  | (26,162) |  |  |

102

##### Table of Contents

PROLOGIS, INC. AND PROLOGIS, L.P.

SCHEDULE III – REAL ESTATE AND ACCUMULATED DEPRECIATION

DECEMBER 31, 2014

(In thousands of U.S. dollars, as applicable)

|  | No. of Bldgs. |  |  |  |  |  | Initial Cost to Prologis |  |  | Costs Capitalized Subsequent To Acquisition |  |  | Gross Amounts At Which Carried at December 31, 2014 |  |  | Accumulated Depreciation (c) |  |  | Date of Construction/ Acquisition
Description |  |  | Encum- brances |  |  | Land |  |  | Building & Improvements |  |  |  | Land |  |  | Building & Improvements |  |  | Total (a,b) |  |  |
Louisville, Kentucky |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Cedar Grove Distribution Center |  |  | 3 |  |  |  |  |  |  |  | 9,611 |  |  |  | 45,964 |  |  |  | 3,582 |  |  |  | 9,610 |  |  |  | 49,547 |  |  |  | 59,157 |  |  |  | (10,348) |  |  | 2005, 2008, 2012
Commerce Crossings Distribution Center |  |  | 1 |  |  |  |  |  |  |  | 1,912 |  |  |  | 7,649 |  |  |  | 186 |  |  |  | 1,912 |  |  |  | 7,835 |  |  |  | 9,747 |  |  |  | (2,454) |  |  | 2005
I-65 Meyer Dist. Center |  |  | 2 |  |  |  | (d | ) |  |  | 7,770 |  |  |  | 15,282 |  |  |  | 24,535 |  |  |  | 8,077 |  |  |  | 39,510 |  |  |  | 47,587 |  |  |  | (7,640) |  |  | 2006, 2012
New Cut Road Dist Ctr |  |  | 1 |  |  |  |  |  |  |  | 2,711 |  |  |  | 11,694 |  |  |  | 621 |  |  |  | 2,711 |  |  |  | 12,315 |  |  |  | 15,026 |  |  |  | (1,378) |  |  | 2012
Riverport Distribution Center |  |  | 1 |  |  |  |  |  |  |  | 1,515 |  |  |  | 8,585 |  |  |  | 2,824 |  |  |  | 1,515 |  |  |  | 11,409 |  |  |  | 12,924 |  |  |  | (6,894) |  |  | 1999
Louisville, Kentucky |  |  | 8 |  |  |  |  |  |  |  | 23,519 |  |  |  | 89,174 |  |  |  | 31,748 |  |  |  | 23,825 |  |  |  | 120,616 |  |  |  | 144,441 |  |  |  | (28,714) |  |  |
Memphis, Tennessee |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Delp Distribution Center |  |  | 3 |  |  |  |  |  |  |  | 1,068 |  |  |  | 10,546 |  |  |  | 583 |  |  |  | 1,068 |  |  |  | 11,129 |  |  |  | 12,197 |  |  |  | (7,304) |  |  | 1995
DeSoto Distribution Center |  |  | 2 |  |  |  | (d | ) |  |  | 5,769 |  |  |  | 4,359 |  |  |  | 27,079 |  |  |  | 5,769 |  |  |  | 31,438 |  |  |  | 37,207 |  |  |  | (5,904) |  |  | 2007, 2014
Memphis Distribution Center |  |  | 4 |  |  |  |  |  |  |  | 9,506 |  |  |  | 42,731 |  |  |  | 1,365 |  |  |  | 9,390 |  |  |  | 44,212 |  |  |  | 53,602 |  |  |  | (6,307) |  |  | 2002, 2012
Memphis Ind Park |  |  | 2 |  |  |  |  |  |  |  | 3,252 |  |  |  | 14,448 |  |  |  | 190 |  |  |  | 3,252 |  |  |  | 14,638 |  |  |  | 17,890 |  |  |  | (1,694) |  |  | 2012
Olive Branch Distribution Center |  |  | 1 |  |  |  | (d | ) |  |  | 6,719 |  |  |  | 31,134 |  |  |  | 328 |  |  |  | 6,719 |  |  |  | 31,462 |  |  |  | 38,181 |  |  |  | (3,856) |  |  | 2012
Stateline Park |  |  | 1 |  |  |  |  |  |  |  | 3,943 |  |  |  | 17,714 |  |  |  | 19 |  |  |  | 3,943 |  |  |  | 17,733 |  |  |  | 21,676 |  |  |  | (150) |  |  | 2014
Willow Lake Distribution Center |  |  | 1 |  |  |  |  |  |  |  | 613 |  |  |  | 3,474 |  |  |  | (25) |  |  |  | 613 |  |  |  | 3,449 |  |  |  | 4,062 |  |  |  | (2,068) |  |  | 1999
Memphis, Tennessee |  |  | 14 |  |  |  |  |  |  |  | 30,870 |  |  |  | 124,406 |  |  |  | 29,539 |  |  |  | 30,754 |  |  |  | 154,061 |  |  |  | 184,815 |  |  |  | (27,283) |  |  |
Nashville, Tennessee |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
CentrePointe Distribution Center |  |  | 2 |  |  |  | (d | ) |  |  | 3,760 |  |  |  | 15,042 |  |  |  | 72 |  |  |  | 3,760 |  |  |  | 15,114 |  |  |  | 18,874 |  |  |  | (525) |  |  | 2013
Elam Farms Park |  |  | 1 |  |  |  |  |  |  |  | 2,097 |  |  |  | 8,386 |  |  |  | 1,834 |  |  |  | 2,097 |  |  |  | 10,220 |  |  |  | 12,317 |  |  |  | (585) |  |  | 2013
I-40 Industrial Center |  |  | 4 |  |  |  |  |  |  |  | 3,075 |  |  |  | 15,333 |  |  |  | 3,713 |  |  |  | 3,075 |  |  |  | 19,046 |  |  |  | 22,121 |  |  |  | (7,202) |  |  | 1995, 1996, 1999, 2012
Interchange City Distribution Center |  |  | 11 |  |  |  | (d | ) |  |  | 11,460 |  |  |  | 51,905 |  |  |  | 1,640 |  |  |  | 11,460 |  |  |  | 53,545 |  |  |  | 65,005 |  |  |  | (2,203) |  |  | 1999, 2012, 2014
Southpark Distribution Center |  |  | 4 |  |  |  | (d | ) |  |  | 11,834 |  |  |  | 47,336 |  |  |  | 626 |  |  |  | 11,834 |  |  |  | 47,962 |  |  |  | 59,796 |  |  |  | (1,654) |  |  | 2013
Nashville, Tennessee |  |  | 22 |  |  |  |  |  |  |  | 32,226 |  |  |  | 138,002 |  |  |  | 7,885 |  |  |  | 32,226 |  |  |  | 145,887 |  |  |  | 178,113 |  |  |  | (12,169) |  |  |
New Jersey/New York |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Brunswick Distribution Center |  |  | 2 |  |  |  |  |  |  |  | 870 |  |  |  | 4,928 |  |  |  | 2,855 |  |  |  | 870 |  |  |  | 7,783 |  |  |  | 8,653 |  |  |  | (5,055) |  |  | 1997
CenterPoint Dist Ctr |  |  | 1 |  |  |  |  |  |  |  | 2,839 |  |  |  | 12,490 |  |  |  | 1,753 |  |  |  | 2,839 |  |  |  | 14,243 |  |  |  | 17,082 |  |  |  | (1,684) |  |  | 2012
Chester Distribution Center |  |  | 1 |  |  |  |  |  |  |  | 548 |  |  |  | 5,319 |  |  |  | 300 |  |  |  | 548 |  |  |  | 5,619 |  |  |  | 6,167 |  |  |  | (4,169) |  |  | 2002
Clifton Dist Ctr |  |  | 1 |  |  |  |  |  |  |  | 8,064 |  |  |  | 12,096 |  |  |  | 1,322 |  |  |  | 8,064 |  |  |  | 13,418 |  |  |  | 21,482 |  |  |  | (2,031) |  |  | 2010
Cranbury Bus Park |  |  | 8 |  |  |  | (d | ) |  |  | 43,056 |  |  |  | 93,306 |  |  |  | 2,013 |  |  |  | 43,056 |  |  |  | 95,319 |  |  |  | 138,375 |  |  |  | (5,391) |  |  | 2012, 2014
Dellamor |  |  | 7 |  |  |  |  |  |  |  | 6,710 |  |  |  | 35,478 |  |  |  | 2,029 |  |  |  | 6,710 |  |  |  | 37,507 |  |  |  | 44,217 |  |  |  | (5,876) |  |  | 2011
Docks Corner SG (Phase II) |  |  | 1 |  |  |  |  |  |  |  | 16,232 |  |  |  | 19,264 |  |  |  | 5,677 |  |  |  | 16,232 |  |  |  | 24,941 |  |  |  | 41,173 |  |  |  | (5,680) |  |  | 2011
Exit 10 Distribution Center |  |  | 7 |  |  |  | (d | ) |  |  | 24,152 |  |  |  | 130,270 |  |  |  | 7,881 |  |  |  | 24,152 |  |  |  | 138,151 |  |  |  | 162,303 |  |  |  | (42,058) |  |  | 2005, 2010
Exit 8A Distribution Center |  |  | 2 |  |  |  | (d | ) |  |  | 21,164 |  |  |  | 87,001 |  |  |  | 563 |  |  |  | 21,164 |  |  |  | 87,564 |  |  |  | 108,728 |  |  |  | (14,166) |  |  | 2005, 2014
Franklin Comm Ctr |  |  | 1 |  |  |  |  |  |  |  | 9,304 |  |  |  | 23,768 |  |  |  | 81 |  |  |  | 9,304 |  |  |  | 23,849 |  |  |  | 33,153 |  |  |  | (2,641) |  |  | 2011
Highway 17 55 Madis |  |  | 1 |  |  |  |  |  |  |  | 2,937 |  |  |  | 13,477 |  |  |  | 1,057 |  |  |  | 2,937 |  |  |  | 14,534 |  |  |  | 17,471 |  |  |  | (2,114) |  |  | 2011
JFK Cargo Center 75_77 |  |  | 2 |  |  |  |  |  |  |  | - |  |  |  | 35,916 |  |  |  | 3,031 |  |  |  | - |  |  |  | 38,947 |  |  |  | 38,947 |  |  |  | (15,166) |  |  | 2011
Kilmer Distribution Center |  |  | 4 |  |  |  | (d | ) |  |  | 2,526 |  |  |  | 14,313 |  |  |  | 4,206 |  |  |  | 2,526 |  |  |  | 18,519 |  |  |  | 21,045 |  |  |  | (11,514) |  |  | 1996
Liberty Log Ctr |  |  | 1 |  |  |  |  |  |  |  | 3,273 |  |  |  | 24,029 |  |  |  | 82 |  |  |  | 3,273 |  |  |  | 24,111 |  |  |  | 27,384 |  |  |  | (2,429) |  |  | 2011
Linden Industrial |  |  | 1 |  |  |  |  |  |  |  | 1,321 |  |  |  | 7,523 |  |  |  | 517 |  |  |  | 1,321 |  |  |  | 8,040 |  |  |  | 9,361 |  |  |  | (1,077) |  |  | 2011
Mahwah Corporate Center |  |  | 4 |  |  |  |  |  |  |  | 12,695 |  |  |  | 27,342 |  |  |  | 894 |  |  |  | 12,695 |  |  |  | 28,236 |  |  |  | 40,931 |  |  |  | (3,813) |  |  | 2011
Meadow Lane |  |  | 1 |  |  |  |  |  |  |  | 1,036 |  |  |  | 6,388 |  |  |  | 2 |  |  |  | 1,036 |  |  |  | 6,390 |  |  |  | 7,426 |  |  |  | (977) |  |  | 2011
Meadowland Distribution Center |  |  | 4 |  |  |  | (d | ) |  |  | 10,271 |  |  |  | 57,480 |  |  |  | 4,923 |  |  |  | 10,271 |  |  |  | 62,403 |  |  |  | 72,674 |  |  |  | (19,387) |  |  | 2005
Meadowland Industrial Center |  |  | 7 |  |  |  | (d | ) |  |  | 4,190 |  |  |  | 13,469 |  |  |  | 17,338 |  |  |  | 4,190 |  |  |  | 30,807 |  |  |  | 34,997 |  |  |  | (19,933) |  |  | 1996, 1998
Meadowlands ALFII |  |  | 3 |  |  |  |  |  |  |  | 3,972 |  |  |  | 18,895 |  |  |  | 3,042 |  |  |  | 3,972 |  |  |  | 21,937 |  |  |  | 25,909 |  |  |  | (2,768) |  |  | 2011
Meadowlands Park |  |  | 8 |  |  |  |  |  |  |  | 6,898 |  |  |  | 41,471 |  |  |  | 1,790 |  |  |  | 6,898 |  |  |  | 43,261 |  |  |  | 50,159 |  |  |  | (6,510) |  |  | 2011
Mooncreek Distribution Center |  |  | 1 |  |  |  |  |  |  |  | 3,319 |  |  |  | 13,422 |  |  |  | 15 |  |  |  | 3,319 |  |  |  | 13,437 |  |  |  | 16,756 |  |  |  | (2,227) |  |  | 2011
Murray Hill Parkway |  |  | 2 |  |  |  |  |  |  |  | 2,907 |  |  |  | 12,040 |  |  |  | 225 |  |  |  | 2,907 |  |  |  | 12,265 |  |  |  | 15,172 |  |  |  | (1,686) |  |  | 2011
National Dist Ctr |  |  | 2 |  |  |  | (d | ) |  |  | 2,417 |  |  |  | 4,244 |  |  |  | 128 |  |  |  | 2,417 |  |  |  | 4,372 |  |  |  | 6,789 |  |  |  | (58) |  |  | 2014
Newark Airport I and II |  |  | 2 |  |  |  |  |  |  |  | 2,757 |  |  |  | 8,749 |  |  |  | 368 |  |  |  | 2,757 |  |  |  | 9,117 |  |  |  | 11,874 |  |  |  | (1,154) |  |  | 2011
Orchard Hill |  |  | 1 |  |  |  |  |  |  |  | 678 |  |  |  | 3,756 |  |  |  | 20 |  |  |  | 678 |  |  |  | 3,776 |  |  |  | 4,454 |  |  |  | (616) |  |  | 2011
Pennsauken Distribution Center |  |  | 2 |  |  |  |  |  |  |  | 192 |  |  |  | 959 |  |  |  | 509 |  |  |  | 203 |  |  |  | 1,457 |  |  |  | 1,660 |  |  |  | (827) |  |  | 1999
Porete Avenue Warehouse |  |  | 1 |  |  |  |  |  |  |  | 5,386 |  |  |  | 21,869 |  |  |  | 435 |  |  |  | 5,386 |  |  |  | 22,304 |  |  |  | 27,690 |  |  |  | (2,645) |  |  | 2011
Port Reading Business Park |  |  | 2 |  |  |  | (d | ) |  |  | 28,374 |  |  |  | 39,914 |  |  |  | 24,819 |  |  |  | 28,374 |  |  |  | 64,733 |  |  |  | 93,107 |  |  |  | (8,306) |  |  | 2005, 2014
Ports Jersey City Distribution Center |  |  | 1 |  |  |  |  |  |  |  | 34,133 |  |  |  | - |  |  |  | 60,354 |  |  |  | 34,133 |  |  |  | 60,354 |  |  |  | 94,487 |  |  |  | (663) |  |  | 2014
Portview Commerce Center |  |  | 3 |  |  |  | (d | ) |  |  | 9,577 |  |  |  | 21,581 |  |  |  | 17,790 |  |  |  | 9,797 |  |  |  | 39,151 |  |  |  | 48,948 |  |  |  | (3,267) |  |  | 2011, 2012
Rancocas Dist Ctr |  |  | 1 |  |  |  |  |  |  |  | 4,103 |  |  |  | 17,291 |  |  |  | 235 |  |  |  | 4,103 |  |  |  | 17,526 |  |  |  | 21,629 |  |  |  | (1,832) |  |  | 2012
Secaucus Dist Ctr |  |  | 2 |  |  |  | (d | ) |  |  | 9,603 |  |  |  | - |  |  |  | 26,882 |  |  |  | 9,603 |  |  |  | 26,882 |  |  |  | 36,485 |  |  |  | (1,384) |  |  | 2012
Skyland Crossdock |  |  | 1 |  |  |  |  |  |  |  | - |  |  |  | 9,831 |  |  |  | 1,293 |  |  |  | - |  |  |  | 11,124 |  |  |  | 11,124 |  |  |  | (1,825) |  |  | 2011
South Jersey Distribution Center |  |  | 1 |  |  |  |  |  |  |  | 6,912 |  |  |  | 17,437 |  |  |  | 181 |  |  |  | 6,912 |  |  |  | 17,618 |  |  |  | 24,530 |  |  |  | (922) |  |  | 2013
Teterboro Meadowlands 15 |  |  | 1 |  |  |  |  |  |  |  | 5,837 |  |  |  | 23,214 |  |  |  | - |  |  |  | 5,837 |  |  |  | 23,214 |  |  |  | 29,051 |  |  |  | (3,067) |  |  | 2011
Two South Middlesex |  |  | 1 |  |  |  |  |  |  |  | 4,389 |  |  |  | 8,410 |  |  |  | 441 |  |  |  | 4,389 |  |  |  | 8,851 |  |  |  | 13,240 |  |  |  | (1,494) |  |  | 2011
New Jersey/New York |  |  | 91 |  |  |  |  |  |  |  | 302,642 |  |  |  | 886,940 |  |  |  | 195,051 |  |  |  | 302,873 |  |  |  | 1,081,760 |  |  |  | 1,384,633 |  |  |  | (206,412) |  |  |
Norfolk, Virginia |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Chesapeake Dist Ctr |  |  | 1 |  |  |  |  |  |  |  | 2,335 |  |  |  | 9,665 |  |  |  | - |  |  |  | 2,335 |  |  |  | 9,665 |  |  |  | 12,000 |  |  |  | (72) |  |  | 2014
Norfolk, Virginia |  |  | 1 |  |  |  |  |  |  |  | 2,335 |  |  |  | 9,665 |  |  |  | - |  |  |  | 2,335 |  |  |  | 9,665 |  |  |  | 12,000 |  |  |  | (72) |  |  |

103

##### Table of Contents

PROLOGIS, INC. AND PROLOGIS, L.P.

SCHEDULE III – REAL ESTATE AND ACCUMULATED DEPRECIATION

DECEMBER 31, 2014

(In thousands of U.S. dollars, as applicable)

|  | No. of Bldgs. |  |  |  |  |  | Initial Cost to Prologis |  |  | Costs Capitalized Subsequent To Acquisition |  |  | Gross Amounts At Which Carried at December 31, 2014 |  |  | Accumulated Depreciation (c) |  |  | Date of Construction/ Acquisition
Description |  |  | Encum- brances |  |  | Land |  |  | Building & Improvements |  |  |  | Land |  |  | Building & Improvements |  |  | Total (a,b) |  |  |
Orlando, Florida |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Beltway Commerce Center |  |  | 3 |  |  |  |  |  |  |  | 17,082 |  |  |  | 25,526 |  |  |  | 8,595 |  |  |  | 17,082 |  |  |  | 34,121 |  |  |  | 51,203 |  |  |  | (4,497) |  |  | 2008
Chancellor Distribution Center |  |  | 1 |  |  |  |  |  |  |  | 380 |  |  |  | 2,157 |  |  |  | 2,566 |  |  |  | 380 |  |  |  | 4,723 |  |  |  | 5,103 |  |  |  | (2,933) |  |  | 1994
Chancellor Square |  |  | 3 |  |  |  |  |  |  |  | 2,087 |  |  |  | 9,708 |  |  |  | 2,150 |  |  |  | 2,087 |  |  |  | 11,858 |  |  |  | 13,945 |  |  |  | (1,615) |  |  | 2011
Consulate Distribution Center |  |  | 5 |  |  |  | (d | ) |  |  | 6,105 |  |  |  | 31,961 |  |  |  | 2,111 |  |  |  | 6,105 |  |  |  | 34,072 |  |  |  | 40,177 |  |  |  | (13,678) |  |  | 1999, 2014
Davenport Dist Ctr |  |  | 1 |  |  |  |  |  |  |  | 934 |  |  |  | 3,991 |  |  |  | 96 |  |  |  | 934 |  |  |  | 4,087 |  |  |  | 5,021 |  |  |  | (439) |  |  | 2012
Orlando Central Park |  |  | 1 |  |  |  |  |  |  |  | 1,398 |  |  |  | 5,977 |  |  |  | 400 |  |  |  | 1,398 |  |  |  | 6,377 |  |  |  | 7,775 |  |  |  | (765) |  |  | 2012
Orlando Corp Ctr |  |  | 6 |  |  |  | (d | ) |  |  | 8,061 |  |  |  | 34,860 |  |  |  | 251 |  |  |  | 8,061 |  |  |  | 35,111 |  |  |  | 43,172 |  |  |  | (279) |  |  | 2014
Presidents Drive |  |  | 6 |  |  |  |  |  |  |  | 6,845 |  |  |  | 31,180 |  |  |  | 3,937 |  |  |  | 6,845 |  |  |  | 35,117 |  |  |  | 41,962 |  |  |  | (5,198) |  |  | 2011
Sand Lake Service Center |  |  | 6 |  |  |  |  |  |  |  | 3,704 |  |  |  | 19,546 |  |  |  | 3,169 |  |  |  | 3,704 |  |  |  | 22,715 |  |  |  | 26,419 |  |  |  | (3,410) |  |  | 2011
Orlando, Florida |  |  | 32 |  |  |  |  |  |  |  | 46,596 |  |  |  | 164,906 |  |  |  | 23,275 |  |  |  | 46,596 |  |  |  | 188,181 |  |  |  | 234,777 |  |  |  | (32,814) |  |  |
Phoenix, Arizona |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
24th Street Industrial Center |  |  | 2 |  |  |  |  |  |  |  | 503 |  |  |  | 2,852 |  |  |  | 1,909 |  |  |  | 561 |  |  |  | 4,703 |  |  |  | 5,264 |  |  |  | (3,458 | ) |  | 1994
Alameda Distribution Center |  |  | 2 |  |  |  |  |  |  |  | 3,872 |  |  |  | 14,358 |  |  |  | 2,474 |  |  |  | 3,872 |  |  |  | 16,832 |  |  |  | 20,704 |  |  |  | (5,566 | ) |  | 2005
Brookridge Dist Ctr |  |  | 1 |  |  |  | (d | ) |  |  | 3,897 |  |  |  | 16,852 |  |  |  | 7 |  |  |  | 3,897 |  |  |  | 16,859 |  |  |  | 20,756 |  |  |  | (135 | ) |  | 2014
Hohokam 10 Business Center |  |  | 1 |  |  |  |  |  |  |  | 1,317 |  |  |  | 7,468 |  |  |  | 1,306 |  |  |  | 1,318 |  |  |  | 8,773 |  |  |  | 10,091 |  |  |  | (4,587 | ) |  | 1999
Kyrene Commons Distribution Center |  |  | 3 |  |  |  |  |  |  |  | 1,093 |  |  |  | 5,475 |  |  |  | 2,500 |  |  |  | 1,093 |  |  |  | 7,975 |  |  |  | 9,068 |  |  |  | (4,895 | ) |  | 1992, 1998, 1999
Papago Distribution Center |  |  | 3 |  |  |  |  |  |  |  | 4,828 |  |  |  | 20,017 |  |  |  | 4,919 |  |  |  | 4,829 |  |  |  | 24,935 |  |  |  | 29,764 |  |  |  | (9,573 | ) |  | 1994, 2005
Phoenix Distribution Center |  |  | 1 |  |  |  |  |  |  |  | 1,441 |  |  |  | 5,578 |  |  |  | 216 |  |  |  | 1,441 |  |  |  | 5,794 |  |  |  | 7,235 |  |  |  | (501 | ) |  | 2012
University Dr Distribution Center |  |  | 1 |  |  |  |  |  |  |  | 683 |  |  |  | 2,735 |  |  |  | 454 |  |  |  | 683 |  |  |  | 3,189 |  |  |  | 3,872 |  |  |  | (1,009 | ) |  | 2005
Watkins Street Distribution Center |  |  | 1 |  |  |  |  |  |  |  | 242 |  |  |  | 1,375 |  |  |  | 596 |  |  |  | 243 |  |  |  | 1,970 |  |  |  | 2,213 |  |  |  | (1,340 | ) |  | 1995
Wilson Drive Distribution Center |  |  | 1 |  |  |  |  |  |  |  | 1,273 |  |  |  | 5,093 |  |  |  | 926 |  |  |  | 1,273 |  |  |  | 6,019 |  |  |  | 7,292 |  |  |  | (1,951 | ) |  | 2005
Phoenix, Arizona |  |  | 16 |  |  |  |  |  |  |  | 19,149 |  |  |  | 81,803 |  |  |  | 15,307 |  |  |  | 19,210 |  |  |  | 97,049 |  |  |  | 116,259 |  |  |  | (33,015 | ) |  |
Portland, Oregon |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Clackamas Dist Ctr |  |  | 5 |  |  |  | (d | ) |  |  | 8,828 |  |  |  | 29,081 |  |  |  | 80 |  |  |  | 8,828 |  |  |  | 29,161 |  |  |  | 37,989 |  |  |  | (841 | ) |  | 2012, 2014
PDX Cargo Center Airtrans |  |  | 2 |  |  |  |  |  |  |  | - |  |  |  | 13,697 |  |  |  | 211 |  |  |  | - |  |  |  | 13,908 |  |  |  | 13,908 |  |  |  | (2,725 | ) |  | 2011
PDX Corporate Center East |  |  | 4 |  |  |  | (d | ) |  |  | 7,126 |  |  |  | 22,413 |  |  |  | 47 |  |  |  | 7,126 |  |  |  | 22,460 |  |  |  | 29,586 |  |  |  | (171 | ) |  | 2014
PDX Corporate Center North Phase II |  |  | 4 |  |  |  | (d | )(e) |  |  | 10,293 |  |  |  | 26,183 |  |  |  | 1,835 |  |  |  | 10,293 |  |  |  | 28,018 |  |  |  | 38,311 |  |  |  | (2,290 | ) |  | 2008, 2014
Southshore Corporate Center |  |  | 2 |  |  |  | (d | )(e) |  |  | 7,059 |  |  |  | 24,799 |  |  |  | (251 | ) |  |  | 7,117 |  |  |  | 24,490 |  |  |  | 31,607 |  |  |  | (3,934 | ) |  | 2006, 2014
Portland, Oregon |  |  | 17 |  |  |  |  |  |  |  | 33,306 |  |  |  | 116,173 |  |  |  | 1,922 |  |  |  | 33,364 |  |  |  | 118,037 |  |  |  | 151,401 |  |  |  | (9,961 | ) |  |
Reno, Nevada |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Damonte Ranch Dist Ctr |  |  | 3 |  |  |  | (d | ) |  |  | 8,764 |  |  |  | 37,135 |  |  |  | 877 |  |  |  | 8,764 |  |  |  | 38,012 |  |  |  | 46,776 |  |  |  | (3,290 | ) |  | 2012, 2014
Golden Valley Distribution Center |  |  | 1 |  |  |  |  |  |  |  | 940 |  |  |  | 13,686 |  |  |  | 2,223 |  |  |  | 2,415 |  |  |  | 14,434 |  |  |  | 16,849 |  |  |  | (4,570 | ) |  | 2005
Meredith Kleppe Business Center |  |  | 5 |  |  |  | (d | ) |  |  | 2,988 |  |  |  | 11,271 |  |  |  | 3,674 |  |  |  | 2,988 |  |  |  | 14,945 |  |  |  | 17,933 |  |  |  | (3,274 | ) |  | 1993, 2014
Packer Way Distribution Center |  |  | 2 |  |  |  |  |  |  |  | 506 |  |  |  | 2,879 |  |  |  | 1,921 |  |  |  | 506 |  |  |  | 4,800 |  |  |  | 5,306 |  |  |  | (3,480 | ) |  | 1993
RNO Cargo Center 10_11 |  |  | 2 |  |  |  |  |  |  |  | - |  |  |  | 4,265 |  |  |  | 306 |  |  |  | - |  |  |  | 4,571 |  |  |  | 4,571 |  |  |  | (1,103 | ) |  | 2011
Tahoe-Reno Industrial Center |  |  | 1 |  |  |  |  |  |  |  | 3,281 |  |  |  | - |  |  |  | 23,844 |  |  |  | 3,281 |  |  |  | 23,844 |  |  |  | 27,125 |  |  |  | (4,971 | ) |  | 2007
Vista Industrial Park |  |  | 6 |  |  |  | (d | ) |  |  | 5,923 |  |  |  | 26,807 |  |  |  | 10,192 |  |  |  | 5,923 |  |  |  | 36,999 |  |  |  | 42,922 |  |  |  | (17,670 | ) |  | 1994, 2001
Reno, Nevada |  |  | 20 |  |  |  |  |  |  |  | 22,402 |  |  |  | 96,043 |  |  |  | 43,037 |  |  |  | 23,877 |  |  |  | 137,605 |  |  |  | 161,482 |  |  |  | (38,358 | ) |  |
Salt Lake City, Utah |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Clearfield Ind Ctr |  |  | 1 |  |  |  |  |  |  |  | 3,485 |  |  |  | 15,581 |  |  |  | - |  |  |  | 3,485 |  |  |  | 15,581 |  |  |  | 19,066 |  |  |  | (184 | ) |  | 2014
Crossroads Corp Ctr |  |  | 2 |  |  |  | (d | ) |  |  | 4,007 |  |  |  | 16,855 |  |  |  | 106 |  |  |  | 4,005 |  |  |  | 16,963 |  |  |  | 20,968 |  |  |  | (794 | ) |  | 2012, 2014
Salt Lake City, Utah |  |  | 3 |  |  |  |  |  |  |  | 7,492 |  |  |  | 32,436 |  |  |  | 106 |  |  |  | 7,490 |  |  |  | 32,544 |  |  |  | 40,034 |  |  |  | (978 | ) |  |
San Antonio, Texas |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Coliseum Distribution Center |  |  | 2 |  |  |  | (d | ) |  |  | 1,607 |  |  |  | 6,968 |  |  |  | - |  |  |  | 1,607 |  |  |  | 6,968 |  |  |  | 8,575 |  |  |  | (56 | ) |  | 2014
Director Drive Dist Ctr |  |  | 2 |  |  |  |  |  |  |  | 1,271 |  |  |  | 5,455 |  |  |  | 220 |  |  |  | 1,271 |  |  |  | 5,675 |  |  |  | 6,946 |  |  |  | (729 | ) |  | 2012
Downtown Dist Ctr |  |  | 1 |  |  |  |  |  |  |  | 579 |  |  |  | 2,539 |  |  |  | - |  |  |  | 579 |  |  |  | 2,539 |  |  |  | 3,118 |  |  |  | (21 | ) |  | 2014
Eisenhauer Distribution Center |  |  | 5 |  |  |  | (d | ) |  |  | 5,042 |  |  |  | 21,684 |  |  |  | 388 |  |  |  | 5,042 |  |  |  | 22,072 |  |  |  | 27,114 |  |  |  | (1,840 | ) |  | 2012, 2014
Interchange East Dist Ctr |  |  | 1 |  |  |  |  |  |  |  | 1,496 |  |  |  | 6,535 |  |  |  | 234 |  |  |  | 1,496 |  |  |  | 6,769 |  |  |  | 8,265 |  |  |  | (1,098 | ) |  | 2012
Landmark One Dist Ctr |  |  | 1 |  |  |  | (d | ) |  |  | 857 |  |  |  | 3,699 |  |  |  | - |  |  |  | 857 |  |  |  | 3,699 |  |  |  | 4,556 |  |  |  | (29 | ) |  | 2014
Macro Distribution Center |  |  | 4 |  |  |  | (d | ) |  |  | 2,535 |  |  |  | 12,647 |  |  |  | 3,900 |  |  |  | 2,535 |  |  |  | 16,547 |  |  |  | 19,082 |  |  |  | (4,757 | ) |  | 2002, 2014
Perrin Creek Corporate Center |  |  | 10 |  |  |  | (d | ) |  |  | 9,770 |  |  |  | 41,337 |  |  |  | 177 |  |  |  | 9,770 |  |  |  | 41,514 |  |  |  | 51,284 |  |  |  | (2,503 | ) |  | 2012, 2014
Rittiman East Industrial Park |  |  | 2 |  |  |  |  |  |  |  | 4,848 |  |  |  | 19,223 |  |  |  | 2,804 |  |  |  | 4,848 |  |  |  | 22,027 |  |  |  | 26,875 |  |  |  | (6,192 | ) |  | 2006
Rittiman West Industrial Park |  |  | 2 |  |  |  |  |  |  |  | 1,230 |  |  |  | 4,950 |  |  |  | 1,159 |  |  |  | 1,230 |  |  |  | 6,109 |  |  |  | 7,339 |  |  |  | (1,949 | ) |  | 2006
San Antonio Distribution Center I |  |  | 6 |  |  |  |  |  |  |  | 1,203 |  |  |  | 4,648 |  |  |  | 7,363 |  |  |  | 1,203 |  |  |  | 12,011 |  |  |  | 13,214 |  |  |  | (8,928 | ) |  | 1993
San Antonio Distribution Center II |  |  | 3 |  |  |  |  |  |  |  | 885 |  |  |  | - |  |  |  | 7,588 |  |  |  | 885 |  |  |  | 7,588 |  |  |  | 8,473 |  |  |  | (4,297 | ) |  | 1994
San Antonio Distribution Center III |  |  | 6 |  |  |  | (d | ) |  |  | 5,079 |  |  |  | 23,372 |  |  |  | 956 |  |  |  | 5,083 |  |  |  | 24,324 |  |  |  | 29,407 |  |  |  | (2,976 | ) |  | 1996, 2012, 2014
Tri-County Distribution Center |  |  | 4 |  |  |  | (d | ) |  |  | 6,888 |  |  |  | 28,693 |  |  |  | 651 |  |  |  | 6,889 |  |  |  | 29,343 |  |  |  | 36,232 |  |  |  | (3,467 | ) |  | 2007, 2014
Valley Industrial Center |  |  | 1 |  |  |  |  |  |  |  | 363 |  |  |  | - |  |  |  | 4,872 |  |  |  | 363 |  |  |  | 4,872 |  |  |  | 5,235 |  |  |  | (2,504 | ) |  | 1997
San Antonio, Texas |  |  | 50 |  |  |  |  |  |  |  | 43,653 |  |  |  | 181,750 |  |  |  | 30,312 |  |  |  | 43,658 |  |  |  | 212,057 |  |  |  | 255,715 |  |  |  | (41,346 | ) |  |
San Francisco Bay Area, California |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Acer Distribution Center |  |  | 1 |  |  |  | (d | ) |  |  | 3,368 |  |  |  | 15,139 |  |  |  | 209 |  |  |  | 3,368 |  |  |  | 15,348 |  |  |  | 18,716 |  |  |  | (2,423 | ) |  | 2011
Alvarado Business Center |  |  | 10 |  |  |  | (d | ) |  |  | 20,739 |  |  |  | 62,595 |  |  |  | 6,332 |  |  |  | 20,739 |  |  |  | 68,927 |  |  |  | 89,666 |  |  |  | (22,002 | ) |  | 2005
Bayshore Distribution Center |  |  | 1 |  |  |  |  |  |  |  | 6,450 |  |  |  | 15,049 |  |  |  | 2,696 |  |  |  | 6,450 |  |  |  | 17,745 |  |  |  | 24,195 |  |  |  | (2,595 | ) |  | 2011
Bayside Corporate Center |  |  | 7 |  |  |  |  |  |  |  | 4,365 |  |  |  | - |  |  |  | 20,611 |  |  |  | 4,365 |  |  |  | 20,611 |  |  |  | 24,976 |  |  |  | (13,119 | ) |  | 1995, 1996

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##### Table of Contents

PROLOGIS, INC. AND PROLOGIS, L.P.

SCHEDULE III – REAL ESTATE AND ACCUMULATED DEPRECIATION

DECEMBER 31, 2014

(In thousands of U.S. dollars, as applicable)

|  | No. of Bldgs. |  |  |  |  |  | Initial Cost to Prologis |  |  | Costs Capitalized Subsequent To Acquisition |  |  | Gross Amounts At Which Carried at December 31, 2014 |  |  | Accumulated Depreciation (c) |  |  | Date of Construction/ Acquisition
Description |  |  | Encum- brances |  |  | Land |  |  | Building & Improvements |  |  |  | Land |  |  | Building & Improvements |  |  | Total (a,b) |  |  |
Bayside Plaza I |  |  | 12 |  |  |  |  |  |  |  | 5,212 |  |  |  | 18,008 |  |  |  | 8,311 |  |  |  | 5,216 |  |  |  | 26,315 |  |  |  | 31,531 |  |  |  | (17,701 | ) |  | 1993
Bayside Plaza II |  |  | 2 |  |  |  |  |  |  |  | 634 |  |  |  | - |  |  |  | 3,576 |  |  |  | 634 |  |  |  | 3,576 |  |  |  | 4,210 |  |  |  | (2,427 | ) |  | 1994
Brennan Distribution |  |  | 1 |  |  |  |  |  |  |  | 1,912 |  |  |  | 7,553 |  |  |  | 63 |  |  |  | 1,912 |  |  |  | 7,616 |  |  |  | 9,528 |  |  |  | (1,181 | ) |  | 2011
Component Drive Ind Port |  |  | 3 |  |  |  |  |  |  |  | 2,829 |  |  |  | 13,532 |  |  |  | 677 |  |  |  | 2,829 |  |  |  | 14,209 |  |  |  | 17,038 |  |  |  | (2,183 | ) |  | 2011
Cypress |  |  | 1 |  |  |  |  |  |  |  | 1,065 |  |  |  | 5,103 |  |  |  | 246 |  |  |  | 1,065 |  |  |  | 5,349 |  |  |  | 6,414 |  |  |  | (794 | ) |  | 2011
Dado Distribution |  |  | 1 |  |  |  |  |  |  |  | 2,194 |  |  |  | 11,079 |  |  |  | 267 |  |  |  | 2,194 |  |  |  | 11,346 |  |  |  | 13,540 |  |  |  | (1,863 | ) |  | 2011
Doolittle Distribution Center |  |  | 1 |  |  |  |  |  |  |  | 2,843 |  |  |  | 18,849 |  |  |  | 848 |  |  |  | 2,843 |  |  |  | 19,697 |  |  |  | 22,540 |  |  |  | (2,640 | ) |  | 2011
Dowe Industrial Center |  |  | 2 |  |  |  | (d | ) |  |  | 5,884 |  |  |  | 20,400 |  |  |  | 809 |  |  |  | 5,884 |  |  |  | 21,209 |  |  |  | 27,093 |  |  |  | (3,357 | ) |  | 2011
Dublin Ind Portfolio |  |  | 1 |  |  |  |  |  |  |  | 3,241 |  |  |  | 15,951 |  |  |  | 993 |  |  |  | 3,241 |  |  |  | 16,944 |  |  |  | 20,185 |  |  |  | (2,179 | ) |  | 2011
East Bay Doolittle |  |  | 1 |  |  |  |  |  |  |  | 4,015 |  |  |  | 15,988 |  |  |  | 1,296 |  |  |  | 4,015 |  |  |  | 17,284 |  |  |  | 21,299 |  |  |  | (2,866 | ) |  | 2011
East Grand Airfreight |  |  | 2 |  |  |  |  |  |  |  | 3,977 |  |  |  | 11,730 |  |  |  | 464 |  |  |  | 3,977 |  |  |  | 12,194 |  |  |  | 16,171 |  |  |  | (1,523 | ) |  | 2011
Edgewater Industrial Center |  |  | 1 |  |  |  |  |  |  |  | 6,630 |  |  |  | 31,153 |  |  |  | 1,968 |  |  |  | 6,630 |  |  |  | 33,121 |  |  |  | 39,751 |  |  |  | (5,206 | ) |  | 2011
Eigenbrodt Way Distribution Center |  |  | 1 |  |  |  |  |  |  |  | 393 |  |  |  | 2,228 |  |  |  | 694 |  |  |  | 393 |  |  |  | 2,922 |  |  |  | 3,315 |  |  |  | (2,038 | ) |  | 1993
Gateway Corporate Center |  |  | 10 |  |  |  |  |  |  |  | 6,736 |  |  |  | 24,747 |  |  |  | 10,340 |  |  |  | 6,744 |  |  |  | 35,079 |  |  |  | 41,823 |  |  |  | (23,670 | ) |  | 1993
Hayward Commerce Center |  |  | 4 |  |  |  |  |  |  |  | 1,933 |  |  |  | 10,955 |  |  |  | 3,550 |  |  |  | 1,933 |  |  |  | 14,505 |  |  |  | 16,438 |  |  |  | (10,191 | ) |  | 1993
Hayward Commerce Park |  |  | 2 |  |  |  | (d | ) |  |  | 7,131 |  |  |  | 11,144 |  |  |  | 325 |  |  |  | 7,131 |  |  |  | 11,469 |  |  |  | 18,600 |  |  |  | (121 | ) |  | 2014
Hayward Distribution Center |  |  | 2 |  |  |  |  |  |  |  | 831 |  |  |  | 5,510 |  |  |  | 3,213 |  |  |  | 1,038 |  |  |  | 8,516 |  |  |  | 9,554 |  |  |  | (6,423 | ) |  | 1993
Hayward Ind - Hathaway |  |  | 2 |  |  |  |  |  |  |  | 6,177 |  |  |  | 8,271 |  |  |  | 25 |  |  |  | 6,177 |  |  |  | 8,296 |  |  |  | 14,473 |  |  |  | (3,244 | ) |  | 2011
Hayward Industrial Center |  |  | 13 |  |  |  |  |  |  |  | 4,481 |  |  |  | 25,393 |  |  |  | 9,298 |  |  |  | 4,481 |  |  |  | 34,691 |  |  |  | 39,172 |  |  |  | (24,063 | ) |  | 1993
Junction Industrial Park |  |  | 4 |  |  |  |  |  |  |  | 7,658 |  |  |  | 39,106 |  |  |  | 1,369 |  |  |  | 7,658 |  |  |  | 40,475 |  |  |  | 48,133 |  |  |  | (5,202 | ) |  | 2011
Lakeside BC |  |  | 1 |  |  |  |  |  |  |  | 3,969 |  |  |  | 11,181 |  |  |  | 871 |  |  |  | 3,969 |  |  |  | 12,052 |  |  |  | 16,021 |  |  |  | (1,281 | ) |  | 2011
Laurelwood Drive |  |  | 2 |  |  |  |  |  |  |  | 3,941 |  |  |  | 13,161 |  |  |  | 318 |  |  |  | 3,941 |  |  |  | 13,479 |  |  |  | 17,420 |  |  |  | (1,708 | ) |  | 2011
Lawrence SSF |  |  | 1 |  |  |  |  |  |  |  | 2,189 |  |  |  | 7,498 |  |  |  | 149 |  |  |  | 2,189 |  |  |  | 7,647 |  |  |  | 9,836 |  |  |  | (1,128 | ) |  | 2011
Livermore Distribution Center |  |  | 4 |  |  |  |  |  |  |  | 8,992 |  |  |  | 26,976 |  |  |  | 2,377 |  |  |  | 8,992 |  |  |  | 29,353 |  |  |  | 38,345 |  |  |  | (9,724 | ) |  | 2005
Martin-Scott Ind Port |  |  | 2 |  |  |  |  |  |  |  | 3,546 |  |  |  | 9,717 |  |  |  | 328 |  |  |  | 3,546 |  |  |  | 10,045 |  |  |  | 13,591 |  |  |  | (1,554 | ) |  | 2011
Oakland Industrial Center |  |  | 3 |  |  |  | (d | ) |  |  | 8,234 |  |  |  | 24,704 |  |  |  | 2,487 |  |  |  | 8,235 |  |  |  | 27,190 |  |  |  | 35,425 |  |  |  | (8,482 | ) |  | 2005
Overlook Distribution Center |  |  | 1 |  |  |  |  |  |  |  | 1,573 |  |  |  | 8,915 |  |  |  | 2,585 |  |  |  | 1,573 |  |  |  | 11,500 |  |  |  | 13,073 |  |  |  | (4,897 | ) |  | 1999
Pacific Business Center |  |  | 2 |  |  |  |  |  |  |  | 6,075 |  |  |  | 26,260 |  |  |  | 3,909 |  |  |  | 6,075 |  |  |  | 30,169 |  |  |  | 36,244 |  |  |  | (4,122 | ) |  | 2011
Pacific Commons Industrial Center |  |  | 5 |  |  |  | (d | )(e) |  |  | 25,784 |  |  |  | 77,594 |  |  |  | 2,190 |  |  |  | 25,805 |  |  |  | 79,763 |  |  |  | 105,568 |  |  |  | (25,247 | ) |  | 2005
Pacific Industrial Center |  |  | 6 |  |  |  | (d | ) |  |  | 21,675 |  |  |  | 65,083 |  |  |  | 4,067 |  |  |  | 21,675 |  |  |  | 69,150 |  |  |  | 90,825 |  |  |  | (21,895 | ) |  | 2005
San Leandro Distribution Center |  |  | 3 |  |  |  |  |  |  |  | 1,387 |  |  |  | 7,862 |  |  |  | 2,860 |  |  |  | 1,387 |  |  |  | 10,722 |  |  |  | 12,109 |  |  |  | (7,618 | ) |  | 1993
Shoreline Business Center |  |  | 8 |  |  |  |  |  |  |  | 4,328 |  |  |  | 16,101 |  |  |  | 6,520 |  |  |  | 4,328 |  |  |  | 22,621 |  |  |  | 26,949 |  |  |  | (14,204 | ) |  | 1993
Silicon Valley R and D |  |  | 2 |  |  |  |  |  |  |  | 2,567 |  |  |  | 10,313 |  |  |  | 340 |  |  |  | 2,567 |  |  |  | 10,653 |  |  |  | 13,220 |  |  |  | (1,415 | ) |  | 2011
South Bay Brokaw |  |  | 3 |  |  |  |  |  |  |  | 4,014 |  |  |  | 23,296 |  |  |  | 822 |  |  |  | 4,014 |  |  |  | 24,118 |  |  |  | 28,132 |  |  |  | (3,174 | ) |  | 2011
South Bay Junction |  |  | 2 |  |  |  |  |  |  |  | 3,662 |  |  |  | 21,120 |  |  |  | 1,402 |  |  |  | 3,662 |  |  |  | 22,522 |  |  |  | 26,184 |  |  |  | (2,859 | ) |  | 2011
South Bay Lundy |  |  | 2 |  |  |  |  |  |  |  | 6,500 |  |  |  | 33,642 |  |  |  | 2,496 |  |  |  | 6,500 |  |  |  | 36,138 |  |  |  | 42,638 |  |  |  | (4,802 | ) |  | 2011
Spinnaker Business Center |  |  | 12 |  |  |  |  |  |  |  | 7,043 |  |  |  | 25,220 |  |  |  | 11,321 |  |  |  | 7,043 |  |  |  | 36,541 |  |  |  | 43,584 |  |  |  | (23,885 | ) |  | 1993
Thornton Business Center |  |  | 4 |  |  |  |  |  |  |  | 2,047 |  |  |  | 11,706 |  |  |  | 4,285 |  |  |  | 2,066 |  |  |  | 15,972 |  |  |  | 18,038 |  |  |  | (10,372 | ) |  | 1993
TriPoint Bus Park |  |  | 4 |  |  |  |  |  |  |  | 9,057 |  |  |  | 23,727 |  |  |  | 4,071 |  |  |  | 9,057 |  |  |  | 27,798 |  |  |  | 36,855 |  |  |  | (3,275 | ) |  | 2011
Utah Airfreight |  |  | 1 |  |  |  |  |  |  |  | 10,657 |  |  |  | 42,842 |  |  |  | 932 |  |  |  | 10,657 |  |  |  | 43,774 |  |  |  | 54,431 |  |  |  | (5,746 | ) |  | 2011
Wiegman Road |  |  | 1 |  |  |  |  |  |  |  | 2,285 |  |  |  | 12,531 |  |  |  | 401 |  |  |  | 2,285 |  |  |  | 12,932 |  |  |  | 15,217 |  |  |  | (1,439 | ) |  | 2011
Willow Park Ind - Ph 1 |  |  | 7 |  |  |  |  |  |  |  | 6,628 |  |  |  | 18,118 |  |  |  | 553 |  |  |  | 6,628 |  |  |  | 18,671 |  |  |  | 25,299 |  |  |  | (3,249 | ) |  | 2011
Willow Park Ind - Ph 2 and 3 |  |  | 4 |  |  |  |  |  |  |  | 15,086 |  |  |  | 27,044 |  |  |  | 1,616 |  |  |  | 15,086 |  |  |  | 28,660 |  |  |  | 43,746 |  |  |  | (4,559 | ) |  | 2011
Willow Park Ind - Ph 4 5 7 8 |  |  | 8 |  |  |  |  |  |  |  | 12,131 |  |  |  | 65,486 |  |  |  | 2,694 |  |  |  | 12,131 |  |  |  | 68,180 |  |  |  | 80,311 |  |  |  | (9,436 | ) |  | 2011
Willow Park Ind - Ph 6 |  |  | 2 |  |  |  |  |  |  |  | 3,696 |  |  |  | 20,929 |  |  |  | 2,196 |  |  |  | 3,696 |  |  |  | 23,125 |  |  |  | 26,821 |  |  |  | (3,626 | ) |  | 2011
Yosemite Drive |  |  | 1 |  |  |  |  |  |  |  | 2,439 |  |  |  | 12,068 |  |  |  | 288 |  |  |  | 2,439 |  |  |  | 12,356 |  |  |  | 14,795 |  |  |  | (1,567 | ) |  | 2011
Zanker-Charcot Industrial |  |  | 5 |  |  |  |  |  |  |  | 4,867 |  |  |  | 28,750 |  |  |  | 1,362 |  |  |  | 4,867 |  |  |  | 30,112 |  |  |  | 34,979 |  |  |  | (3,832 | ) |  | 2011
San Francisco Bay Area, California |  |  | 181 |  |  |  |  |  |  |  | 295,070 |  |  |  | 1,061,327 |  |  |  | 141,620 |  |  |  | 295,330 |  |  |  | 1,202,687 |  |  |  | 1,498,017 |  |  |  | (344,107 | ) |  |
Savannah, Georgia |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Morgan Bus Ctr |  |  | 1 |  |  |  |  |  |  |  | 2,161 |  |  |  | 14,680 |  |  |  | 1,234 |  |  |  | 2,161 |  |  |  | 15,914 |  |  |  | 18,075 |  |  |  | (1,675 | ) |  | 2011
Savannah, Georgia |  |  | 1 |  |  |  |  |  |  |  | 2,161 |  |  |  | 14,680 |  |  |  | 1,234 |  |  |  | 2,161 |  |  |  | 15,914 |  |  |  | 18,075 |  |  |  | (1,675 | ) |  |
Seattle, Washington |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
East Valley Warehouse |  |  | 1 |  |  |  | (d | )(e) |  |  | 10,472 |  |  |  | 57,825 |  |  |  | 793 |  |  |  | 10,472 |  |  |  | 58,618 |  |  |  | 69,090 |  |  |  | (6,704 | ) |  | 2011
Fife Distribution Center |  |  | 1 |  |  |  |  |  |  |  | 3,245 |  |  |  | - |  |  |  | 13,366 |  |  |  | 3,245 |  |  |  | 13,366 |  |  |  | 16,611 |  |  |  | (401 | ) |  | 2013
Harvest Business Park |  |  | 3 |  |  |  |  |  |  |  | 3,541 |  |  |  | 18,827 |  |  |  | 747 |  |  |  | 3,541 |  |  |  | 19,574 |  |  |  | 23,115 |  |  |  | (2,488 | ) |  | 2011
Kent Centre Corporate Park |  |  | 4 |  |  |  |  |  |  |  | 5,397 |  |  |  | 21,599 |  |  |  | 656 |  |  |  | 5,397 |  |  |  | 22,255 |  |  |  | 27,652 |  |  |  | (2,856 | ) |  | 2011
Kingsport Industrial Park |  |  | 7 |  |  |  |  |  |  |  | 16,605 |  |  |  | 48,942 |  |  |  | 2,233 |  |  |  | 16,800 |  |  |  | 50,980 |  |  |  | 67,780 |  |  |  | (8,620 | ) |  | 2011
Northwest Distribution Center |  |  | 3 |  |  |  |  |  |  |  | 5,114 |  |  |  | 24,090 |  |  |  | 1,747 |  |  |  | 5,114 |  |  |  | 25,837 |  |  |  | 30,951 |  |  |  | (3,273 | ) |  | 2011
ProLogis Park SeaTac |  |  | 2 |  |  |  | (d | ) |  |  | 12,230 |  |  |  | 14,170 |  |  |  | 3,453 |  |  |  | 12,457 |  |  |  | 17,396 |  |  |  | 29,853 |  |  |  | (3,124 | ) |  | 2008
Puget Sound Airfreight |  |  | 1 |  |  |  |  |  |  |  | 1,408 |  |  |  | 4,201 |  |  |  | 210 |  |  |  | 1,408 |  |  |  | 4,411 |  |  |  | 5,819 |  |  |  | (572 | ) |  | 2011
Renton Northwest Corp. Park |  |  | 4 |  |  |  |  |  |  |  | 5,102 |  |  |  | 17,946 |  |  |  | 478 |  |  |  | 5,102 |  |  |  | 18,424 |  |  |  | 23,526 |  |  |  | (2,800 | ) |  | 2011
SEA Cargo Center North |  |  | 1 |  |  |  |  |  |  |  | - |  |  |  | 10,279 |  |  |  | 40 |  |  |  | - |  |  |  | 10,319 |  |  |  | 10,319 |  |  |  | (5,674 | ) |  | 2011
SEA Cargo Center South |  |  | 1 |  |  |  |  |  |  |  | - |  |  |  | 2,745 |  |  |  | 11 |  |  |  | - |  |  |  | 2,756 |  |  |  | 2,756 |  |  |  | (2,722 | ) |  | 2011
Sumner Landing |  |  | 1 |  |  |  | (e | ) |  |  | 10,332 |  |  |  | 32,545 |  |  |  | 767 |  |  |  | 10,332 |  |  |  | 33,312 |  |  |  | 43,644 |  |  |  | (3,391 | ) |  | 2011
Van Doren’s Distribution Center |  |  | 1 |  |  |  | (d | ) |  |  | 3,166 |  |  |  | 7,716 |  |  |  | 7 |  |  |  | 3,166 |  |  |  | 7,723 |  |  |  | 10,889 |  |  |  | (58 | ) |  | 2014
Seattle, Washington |  |  | 30 |  |  |  |  |  |  |  | 76,612 |  |  |  | 260,885 |  |  |  | 24,508 |  |  |  | 77,034 |  |  |  | 284,971 |  |  |  | 362,005 |  |  |  | (42,683 | ) |  |
South Florida |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Airport West Distribution Center |  |  | 2 |  |  |  | (d | ) |  |  | 1,253 |  |  |  | 3,825 |  |  |  | 4,109 |  |  |  | 1,974 |  |  |  | 7,213 |  |  |  | 9,187 |  |  |  | (3,697 | ) |  | 1995, 1998
Beacon Centre |  |  | 18 |  |  |  |  |  |  |  | 37,998 |  |  |  | 196,004 |  |  |  | 8,256 |  |  |  | 37,998 |  |  |  | 204,260 |  |  |  | 242,258 |  |  |  | (24,652 | ) |  | 2011

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##### Table of Contents

PROLOGIS, INC. AND PROLOGIS, L.P.

SCHEDULE III – REAL ESTATE AND ACCUMULATED DEPRECIATION

DECEMBER 31, 2014

(In thousands of U.S. dollars, as applicable)

|  | No. of Bldgs. |  |  |  |  |  | Initial Cost to Prologis |  |  | Costs Capitalized Subsequent To Acquisition |  |  | Gross Amounts At Which Carried at December 31, 2014 |  |  | Accumulated Depreciation (c) |  |  | Date of Construction/ Acquisition
Description |  |  | Encum- brances |  |  | Land |  |  | Building & Improvements |  |  |  | Land |  |  | Building & Improvements |  |  | Total (a,b) |  |  |
Beacon Industrial Park |  |  | 8 |  |  |  | (d | ) |  |  | 20,139 |  |  |  | 68,093 |  |  |  | 3,405 |  |  |  | 20,139 |  |  |  | 71,498 |  |  |  | 91,637 |  |  |  | (8,627 | ) |  | 2011
Beacon Lakes |  |  | 2 |  |  |  |  |  |  |  | 6,504 |  |  |  | - |  |  |  | 18,865 |  |  |  | 6,504 |  |  |  | 18,865 |  |  |  | 25,369 |  |  |  | (308 | ) |  | 2012, 2014
Blue Lagoon Business Park |  |  | 2 |  |  |  | (d | ) |  |  | 9,189 |  |  |  | 29,451 |  |  |  | 1,336 |  |  |  | 9,189 |  |  |  | 30,787 |  |  |  | 39,976 |  |  |  | (4,025 | ) |  | 2011
CenterPort Distribution Center |  |  | 5 |  |  |  | (d | ) |  |  | 8,802 |  |  |  | 22,504 |  |  |  | 3,121 |  |  |  | 8,922 |  |  |  | 25,505 |  |  |  | 34,427 |  |  |  | (8,511 | ) |  | 1999, 2012
Copans Distribution Center |  |  | 2 |  |  |  |  |  |  |  | 504 |  |  |  | 2,857 |  |  |  | 1,486 |  |  |  | 504 |  |  |  | 4,343 |  |  |  | 4,847 |  |  |  | (2,151 | ) |  | 1997, 1998
Dolphin Distribution Center |  |  | 1 |  |  |  |  |  |  |  | 2,716 |  |  |  | 7,364 |  |  |  | 866 |  |  |  | 2,716 |  |  |  | 8,230 |  |  |  | 10,946 |  |  |  | (1,397 | ) |  | 2011
International Corp Park |  |  | 2 |  |  |  |  |  |  |  | 10,596 |  |  |  | 15,898 |  |  |  | 2,211 |  |  |  | 10,596 |  |  |  | 18,109 |  |  |  | 28,705 |  |  |  | (2,643 | ) |  | 2010
Marlin Distribution Center |  |  | 1 |  |  |  |  |  |  |  | 1,844 |  |  |  | 6,603 |  |  |  | 361 |  |  |  | 1,844 |  |  |  | 6,964 |  |  |  | 8,808 |  |  |  | (1,041 | ) |  | 2011
Miami Airport Business Center |  |  | 6 |  |  |  |  |  |  |  | 11,173 |  |  |  | 45,921 |  |  |  | 2,115 |  |  |  | 11,173 |  |  |  | 48,036 |  |  |  | 59,209 |  |  |  | (6,548 | ) |  | 2011
North Andrews Distribution Center |  |  | 1 |  |  |  |  |  |  |  | 698 |  |  |  | 3,956 |  |  |  | 391 |  |  |  | 698 |  |  |  | 4,347 |  |  |  | 5,045 |  |  |  | (2,804 | ) |  | 1994
Pompano Beach Distribution Center |  |  | 3 |  |  |  |  |  |  |  | 11,035 |  |  |  | 15,136 |  |  |  | 3,692 |  |  |  | 11,035 |  |  |  | 18,828 |  |  |  | 29,863 |  |  |  | (2,772 | ) |  | 2008
Pompano Center of Commer |  |  | 5 |  |  |  |  |  |  |  | 5,171 |  |  |  | 13,930 |  |  |  | 391 |  |  |  | 5,171 |  |  |  | 14,321 |  |  |  | 19,492 |  |  |  | (1,689 | ) |  | 2011
Port Lauderdale Distribution Center |  |  | 7 |  |  |  | (d | ) |  |  | 37,472 |  |  |  | 69,457 |  |  |  | 9,239 |  |  |  | 38,781 |  |  |  | 77,387 |  |  |  | 116,168 |  |  |  | (5,328 | ) |  | 1997, 2012, 2014
ProLogis Park I-595 |  |  | 2 |  |  |  | (d | ) |  |  | 1,998 |  |  |  | 11,326 |  |  |  | 959 |  |  |  | 1,999 |  |  |  | 12,284 |  |  |  | 14,283 |  |  |  | (4,932 | ) |  | 2003
Sawgrass Distribution Center |  |  | 2 |  |  |  |  |  |  |  | 10,016 |  |  |  | - |  |  |  | 15,142 |  |  |  | 10,016 |  |  |  | 15,142 |  |  |  | 25,158 |  |  |  | (1,876 | ) |  | 2009
Tarpon Distribution Center |  |  | 1 |  |  |  |  |  |  |  | 1,847 |  |  |  | 6,451 |  |  |  | 179 |  |  |  | 1,847 |  |  |  | 6,630 |  |  |  | 8,477 |  |  |  | (1,153 | ) |  | 2011
South Florida |  |  | 70 |  |  |  |  |  |  |  | 178,955 |  |  |  | 518,776 |  |  |  | 76,124 |  |  |  | 181,106 |  |  |  | 592,749 |  |  |  | 773,855 |  |  |  | (84,154 | ) |  |
Southern California |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Anaheim Industrial Center |  |  | 12 |  |  |  |  |  |  |  | 31,086 |  |  |  | 57,836 |  |  |  | 2,815 |  |  |  | 31,086 |  |  |  | 60,651 |  |  |  | 91,737 |  |  |  | (19,039 | ) |  | 2005
Anaheim Industrial Property |  |  | 1 |  |  |  |  |  |  |  | 5,096 |  |  |  | 10,816 |  |  |  | 71 |  |  |  | 5,096 |  |  |  | 10,887 |  |  |  | 15,983 |  |  |  | (1,375 | ) |  | 2011
Arrow Ind. Park |  |  | 2 |  |  |  |  |  |  |  | 4,840 |  |  |  | 8,120 |  |  |  | 866 |  |  |  | 4,840 |  |  |  | 8,986 |  |  |  | 13,826 |  |  |  | (1,125 | ) |  | 2012
Artesia Industrial |  |  | 19 |  |  |  |  |  |  |  | 68,691 |  |  |  | 145,492 |  |  |  | 5,223 |  |  |  | 68,691 |  |  |  | 150,715 |  |  |  | 219,406 |  |  |  | (21,283 | ) |  | 2011
Bell Ranch Distribution |  |  | 4 |  |  |  |  |  |  |  | 5,539 |  |  |  | 23,092 |  |  |  | 1,657 |  |  |  | 5,539 |  |  |  | 24,749 |  |  |  | 30,288 |  |  |  | (3,491 | ) |  | 2011
Brea Ind Ctr |  |  | 1 |  |  |  |  |  |  |  | 2,488 |  |  |  | 4,062 |  |  |  | 287 |  |  |  | 2,488 |  |  |  | 4,349 |  |  |  | 6,837 |  |  |  | (471 | ) |  | 2012
California Commerce Center |  |  | 5 |  |  |  |  |  |  |  | 18,708 |  |  |  | 35,633 |  |  |  | 2,465 |  |  |  | 18,708 |  |  |  | 38,098 |  |  |  | 56,806 |  |  |  | (3,457 | ) |  | 2012, 2014
Carson Dist Ctr |  |  | 1 |  |  |  |  |  |  |  | 15,491 |  |  |  | - |  |  |  | 17,000 |  |  |  | 15,491 |  |  |  | 17,000 |  |  |  | 32,491 |  |  |  | (1,330 | ) |  | 2011
Carson Industrial |  |  | 12 |  |  |  |  |  |  |  | 13,608 |  |  |  | 32,802 |  |  |  | 3,166 |  |  |  | 13,608 |  |  |  | 35,968 |  |  |  | 49,576 |  |  |  | (5,068 | ) |  | 2011
Carson Town Center |  |  | 2 |  |  |  |  |  |  |  | 11,781 |  |  |  | 31,572 |  |  |  | 698 |  |  |  | 11,781 |  |  |  | 32,270 |  |  |  | 44,051 |  |  |  | (3,711 | ) |  | 2011
Cedarpointe Ind Park |  |  | 5 |  |  |  |  |  |  |  | 7,824 |  |  |  | 12,476 |  |  |  | 664 |  |  |  | 7,824 |  |  |  | 13,140 |  |  |  | 20,964 |  |  |  | (1,488 | ) |  | 2012
Chartwell Distribution Center |  |  | 1 |  |  |  |  |  |  |  | 6,417 |  |  |  | 16,964 |  |  |  | 801 |  |  |  | 6,417 |  |  |  | 17,765 |  |  |  | 24,182 |  |  |  | (2,347 | ) |  | 2011
Chino Ind Ctr |  |  | 4 |  |  |  |  |  |  |  | 850 |  |  |  | 1,274 |  |  |  | 10 |  |  |  | 850 |  |  |  | 1,284 |  |  |  | 2,134 |  |  |  | (649 | ) |  | 2012
Commerce Ind Ctr |  |  | 1 |  |  |  |  |  |  |  | 11,345 |  |  |  | 17,653 |  |  |  | 88 |  |  |  | 11,345 |  |  |  | 17,741 |  |  |  | 29,086 |  |  |  | (1,833 | ) |  | 2012
Crossroads Business Park |  |  | 9 |  |  |  | (d | ) |  |  | 36,131 |  |  |  | 98,797 |  |  |  | 126,748 |  |  |  | 89,658 |  |  |  | 172,018 |  |  |  | 261,676 |  |  |  | (35,650 | ) |  | 2005, 2010, 2014
Del Amo Industrial Center |  |  | 1 |  |  |  |  |  |  |  | 7,471 |  |  |  | 17,889 |  |  |  | 386 |  |  |  | 7,471 |  |  |  | 18,275 |  |  |  | 25,746 |  |  |  | (2,734 | ) |  | 2011
Dominguez North Industrial Center |  |  | 6 |  |  |  | (d | ) |  |  | 20,662 |  |  |  | 34,382 |  |  |  | 2,883 |  |  |  | 20,688 |  |  |  | 37,239 |  |  |  | 57,927 |  |  |  | (6,222 | ) |  | 2007, 2012
Eaves Distribution Center |  |  | 3 |  |  |  |  |  |  |  | 13,914 |  |  |  | 31,041 |  |  |  | 1,953 |  |  |  | 13,914 |  |  |  | 32,994 |  |  |  | 46,908 |  |  |  | (5,156 | ) |  | 2011
Foothill Bus Ctr |  |  | 3 |  |  |  |  |  |  |  | 5,254 |  |  |  | 8,096 |  |  |  | 117 |  |  |  | 5,254 |  |  |  | 8,213 |  |  |  | 13,467 |  |  |  | (836 | ) |  | 2012
Ford Distribution Cntr |  |  | 7 |  |  |  |  |  |  |  | 29,895 |  |  |  | 81,433 |  |  |  | 2,875 |  |  |  | 29,895 |  |  |  | 84,308 |  |  |  | 114,203 |  |  |  | (13,365 | ) |  | 2011
Fordyce Distribution Center |  |  | 1 |  |  |  |  |  |  |  | 6,110 |  |  |  | 19,485 |  |  |  | 765 |  |  |  | 6,110 |  |  |  | 20,250 |  |  |  | 26,360 |  |  |  | (3,379 | ) |  | 2011
Harris Bus Ctr Alliance II |  |  | 9 |  |  |  |  |  |  |  | 13,134 |  |  |  | 66,195 |  |  |  | 1,967 |  |  |  | 13,134 |  |  |  | 68,162 |  |  |  | 81,296 |  |  |  | (8,942 | ) |  | 2011
Haven Distribution Center |  |  | 4 |  |  |  | (d | ) |  |  | 96,975 |  |  |  | 73,903 |  |  |  | 7,620 |  |  |  | 96,975 |  |  |  | 81,523 |  |  |  | 178,498 |  |  |  | (13,312 | ) |  | 2008
Industry Distribution Center |  |  | 8 |  |  |  | (d | )(e) |  |  | 54,170 |  |  |  | 99,434 |  |  |  | 4,891 |  |  |  | 54,170 |  |  |  | 104,325 |  |  |  | 158,495 |  |  |  | (31,872 | ) |  | 2005, 2012
Inland Empire Distribution Center |  |  | 6 |  |  |  | (d | ) |  |  | 37,805 |  |  |  | 66,530 |  |  |  | 8,469 |  |  |  | 38,585 |  |  |  | 74,219 |  |  |  | 112,804 |  |  |  | (21,549 | ) |  | 2005, 2012
Kaiser Distribution Center |  |  | 8 |  |  |  | (d | )(e) |  |  | 131,819 |  |  |  | 242,618 |  |  |  | 20,367 |  |  |  | 136,030 |  |  |  | 258,774 |  |  |  | 394,804 |  |  |  | (80,093 | ) |  | 2005, 2008
LAX Cargo Center |  |  | 3 |  |  |  |  |  |  |  | - |  |  |  | 19,217 |  |  |  | 193 |  |  |  | - |  |  |  | 19,410 |  |  |  | 19,410 |  |  |  | (4,789 | ) |  | 2011
Los Angeles Industrial Center |  |  | 2 |  |  |  |  |  |  |  | 3,777 |  |  |  | 7,015 |  |  |  | 353 |  |  |  | 3,777 |  |  |  | 7,368 |  |  |  | 11,145 |  |  |  | (2,425 | ) |  | 2005
Meridian Park |  |  | 1 |  |  |  |  |  |  |  | 12,931 |  |  |  | 24,268 |  |  |  | 142 |  |  |  | 12,931 |  |  |  | 24,410 |  |  |  | 37,341 |  |  |  | (5,629 | ) |  | 2008
Mid Counties Industrial Center |  |  | 18 |  |  |  | (d | ) |  |  | 55,436 |  |  |  | 96,453 |  |  |  | 15,386 |  |  |  | 55,437 |  |  |  | 111,838 |  |  |  | 167,275 |  |  |  | (35,190 | ) |  | 2005, 2006, 2010, 2012
Mill Street Dist Ctr |  |  | 1 |  |  |  |  |  |  |  | 1,825 |  |  |  | 4,572 |  |  |  | - |  |  |  | 1,825 |  |  |  | 4,572 |  |  |  | 6,397 |  |  |  | (36 | ) |  | 2014
Mill Street Spec Dist Ctr |  |  | 1 |  |  |  | (d | ) |  |  | 15,691 |  |  |  | 38,520 |  |  |  | 1 |  |  |  | 15,691 |  |  |  | 38,521 |  |  |  | 54,212 |  |  |  | (294 | ) |  | 2014
Milliken Dist Ctr |  |  | 1 |  |  |  |  |  |  |  | 18,831 |  |  |  | 30,811 |  |  |  | 219 |  |  |  | 18,831 |  |  |  | 31,030 |  |  |  | 49,861 |  |  |  | (3,458 | ) |  | 2012
NDP—Los Angeles |  |  | 5 |  |  |  |  |  |  |  | 14,855 |  |  |  | 41,115 |  |  |  | 2,020 |  |  |  | 14,855 |  |  |  | 43,135 |  |  |  | 57,990 |  |  |  | (6,677 | ) |  | 2011
Normandie Industrial |  |  | 1 |  |  |  |  |  |  |  | 12,297 |  |  |  | 14,957 |  |  |  | 726 |  |  |  | 12,297 |  |  |  | 15,683 |  |  |  | 27,980 |  |  |  | (2,717 | ) |  | 2011
North County Dist Ctr |  |  | 3 |  |  |  |  |  |  |  | 49,949 |  |  |  | 76,943 |  |  |  | 4,061 |  |  |  | 49,949 |  |  |  | 81,004 |  |  |  | 130,953 |  |  |  | (8,910 | ) |  | 2011, 2012
Ontario Dist Ctr |  |  | 1 |  |  |  |  |  |  |  | 18,823 |  |  |  | 29,524 |  |  |  | 482 |  |  |  | 18,823 |  |  |  | 30,006 |  |  |  | 48,829 |  |  |  | (3,099 | ) |  | 2012
Orange Industrial Center |  |  | 1 |  |  |  |  |  |  |  | 4,156 |  |  |  | 7,836 |  |  |  | 349 |  |  |  | 4,157 |  |  |  | 8,184 |  |  |  | 12,341 |  |  |  | (2,561 | ) |  | 2005
Pacific Bus Ctr |  |  | 5 |  |  |  |  |  |  |  | 20,810 |  |  |  | 32,169 |  |  |  | 1,675 |  |  |  | 20,810 |  |  |  | 33,844 |  |  |  | 54,654 |  |  |  | (3,467 | ) |  | 2012
ProLogis Park Ontario |  |  | 2 |  |  |  | (d | ) |  |  | 25,499 |  |  |  | 47,366 |  |  |  | 813 |  |  |  | 25,499 |  |  |  | 48,179 |  |  |  | 73,678 |  |  |  | (12,505 | ) |  | 2007
Rancho Cucamonga Distribution Center |  |  | 4 |  |  |  | (d | )(e) |  |  | 46,471 |  |  |  | 86,305 |  |  |  | 2,091 |  |  |  | 46,472 |  |  |  | 88,395 |  |  |  | 134,867 |  |  |  | (27,341 | ) |  | 2005
Redlands Comm Ctr |  |  | 1 |  |  |  |  |  |  |  | 20,583 |  |  |  | 32,750 |  |  |  | - |  |  |  | 20,583 |  |  |  | 32,750 |  |  |  | 53,333 |  |  |  | (254 | ) |  | 2014
Redlands Distribution Center |  |  | 7 |  |  |  | (d | ) |  |  | 69,051 |  |  |  | 99,842 |  |  |  | 74,367 |  |  |  | 72,589 |  |  |  | 170,671 |  |  |  | 243,260 |  |  |  | (18,529 | ) |  | 2006, 2007, 2012, 2013, 2014
Rialto Dist Ctr |  |  | 4 |  |  |  | (d | ) |  |  | 73,396 |  |  |  | 204,161 |  |  |  | 442 |  |  |  | 73,396 |  |  |  | 204,603 |  |  |  | 277,999 |  |  |  | (15,058 | ) |  | 2012, 2014
Riverbluff Distribution Center |  |  | 1 |  |  |  | (d | ) |  |  | 42,964 |  |  |  | - |  |  |  | 32,928 |  |  |  | 42,964 |  |  |  | 32,928 |  |  |  | 75,892 |  |  |  | (6,090 | ) |  | 2009
Riverside Dist Ctr (LAX) |  |  | 2 |  |  |  |  |  |  |  | 2,178 |  |  |  | 3,440 |  |  |  | 150 |  |  |  | 2,178 |  |  |  | 3,590 |  |  |  | 5,768 |  |  |  | (375 | ) |  | 2012
Santa Ana Distribution Center |  |  | 2 |  |  |  |  |  |  |  | 4,318 |  |  |  | 8,019 |  |  |  | 759 |  |  |  | 4,318 |  |  |  | 8,778 |  |  |  | 13,096 |  |  |  | (2,786 | ) |  | 2005
South Bay Distribution Center |  |  | 4 |  |  |  | (d | ) |  |  | 14,478 |  |  |  | 27,511 |  |  |  | 3,489 |  |  |  | 15,280 |  |  |  | 30,198 |  |  |  | 45,478 |  |  |  | (10,026 | ) |  | 2005, 2007
Starboard Distribution Ctr |  |  | 1 |  |  |  |  |  |  |  | 18,763 |  |  |  | 53,824 |  |  |  | 119 |  |  |  | 18,763 |  |  |  | 53,943 |  |  |  | 72,706 |  |  |  | (6,883 | ) |  | 2011
Terra Francesco |  |  | 1 |  |  |  |  |  |  |  | 11,196 |  |  |  | - |  |  |  | 15,591 |  |  |  | 11,196 |  |  |  | 15,591 |  |  |  | 26,787 |  |  |  | (117 | ) |  | 2012
Torrance Dist Ctr |  |  | 1 |  |  |  |  |  |  |  | 25,730 |  |  |  | 40,414 |  |  |  | 287 |  |  |  | 25,730 |  |  |  | 40,701 |  |  |  | 66,431 |  |  |  | (4,234 | ) |  | 2012
Transpark Inland Empire Dist Ctr |  |  | 1 |  |  |  | (d | ) |  |  | 28,936 |  |  |  | 44,721 |  |  |  | - |  |  |  | 28,936 |  |  |  | 44,721 |  |  |  | 73,657 |  |  |  | (329 | ) |  | 2014
Van Nuys Airport Industrial |  |  | 4 |  |  |  |  |  |  |  | 23,455 |  |  |  | 39,916 |  |  |  | 2,588 |  |  |  | 23,455 |  |  |  | 42,504 |  |  |  | 65,959 |  |  |  | (5,018 | ) |  | 2011

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##### Table of Contents

PROLOGIS, INC. AND PROLOGIS, L.P.

SCHEDULE III – REAL ESTATE AND ACCUMULATED DEPRECIATION

DECEMBER 31, 2014

(In thousands of U.S. dollars, as applicable)

|  | No. of Bldgs. |  |  |  |  | Initial Cost to Prologis |  |  | Costs Capitalized Subsequent To Acquisition |  |  | Gross Amounts At Which Carried at December 31, 2014 |  |  | Accumulated Depreciation (c) |  |  | Date of Construction/ Acquisition
Description |  |  | Encum- brances |  | Land |  |  | Building & Improvements |  |  |  | Land |  |  | Building & Improvements |  |  | Total (a,b) |  |  |
Vernon Distribution Center |  |  | 15 |  |  |  |  |  | 25,439 |  |  |  | 47,250 |  |  |  | 3,912 |  |  |  | 25,441 |  |  |  | 51,160 |  |  |  | 76,601 |  |  |  | (16,728 | ) |  | 2005
Vernon Industrial |  |  | 2 |  |  |  |  |  | 3,626 |  |  |  | 3,319 |  |  |  | 197 |  |  |  | 3,626 |  |  |  | 3,516 |  |  |  | 7,142 |  |  |  | (2,084 | ) |  | 2011
Vista Distribution Center |  |  | 1 |  |  |  |  |  | 4,150 |  |  |  | 6,225 |  |  |  | 3,415 |  |  |  | 4,150 |  |  |  | 9,640 |  |  |  | 13,790 |  |  |  | (1,569 | ) |  | 2012
Vista Rialto Distrib Ctr |  |  | 1 |  |  |  |  |  | 5,885 |  |  |  | 25,991 |  |  |  | 242 |  |  |  | 5,885 |  |  |  | 26,233 |  |  |  | 32,118 |  |  |  | (3,188 | ) |  | 2011
Walnut Drive |  |  | 1 |  |  |  |  |  | 2,665 |  |  |  | 7,397 |  |  |  | 218 |  |  |  | 2,665 |  |  |  | 7,615 |  |  |  | 10,280 |  |  |  | (960 | ) |  | 2011
Watson Industrial Center AFdII |  |  | 1 |  |  |  |  |  | 6,944 |  |  |  | 11,193 |  |  |  | 65 |  |  |  | 6,944 |  |  |  | 11,258 |  |  |  | 18,202 |  |  |  | (1,478 | ) |  | 2011
Wilmington Avenue Warehouse |  |  | 2 |  |  |  |  |  | 11,172 |  |  |  | 34,723 |  |  |  | 2,389 |  |  |  | 11,172 |  |  |  | 37,112 |  |  |  | 48,284 |  |  |  | (4,629 | ) |  | 2011
Southern California |  |  | 236 |  |  |  |  |  | 1,353,384 |  |  |  | 2,485,362 |  |  |  | 384,521 |  |  |  | 1,416,273 |  |  |  | 2,806,994 |  |  |  | 4,223,267 |  |  |  | (509,210 | ) |  |
St. Louis, Missouri |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Earth City Industrial Center |  |  | 3 |  |  |  |  |  | 807 |  |  |  | 4,992 |  |  |  | 2,057 |  |  |  | 807 |  |  |  | 7,049 |  |  |  | 7,856 |  |  |  | (3,800 | ) |  | 1998, 2014
Hazelwood Dist Ctr |  |  | 2 |  |  |  |  |  | 833 |  |  |  | 4,721 |  |  |  | 24 |  |  |  | 833 |  |  |  | 4,745 |  |  |  | 5,578 |  |  |  | (49 | ) |  | 2014
Westport Distribution Center |  |  | 3 |  |  |  |  |  | 824 |  |  |  | 3,849 |  |  |  | 2,403 |  |  |  | 824 |  |  |  | 6,252 |  |  |  | 7,076 |  |  |  | (2,316 | ) |  | 1997, 2014
St. Louis, Missouri |  |  | 8 |  |  |  |  |  | 2,464 |  |  |  | 13,562 |  |  |  | 4,484 |  |  |  | 2,464 |  |  |  | 18,046 |  |  |  | 20,510 |  |  |  | (6,165 | ) |  |
Guadalajara |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Parque Opcion |  |  | 1 |  |  |  |  |  | 730 |  |  |  | 2,287 |  |  |  | 1,362 |  |  |  | 730 |  |  |  | 3,649 |  |  |  | 4,379 |  |  |  | (504 | ) |  | 2011
Guadalajara |  |  | 1 |  |  |  |  |  | 730 |  |  |  | 2,287 |  |  |  | 1,362 |  |  |  | 730 |  |  |  | 3,649 |  |  |  | 4,379 |  |  |  | (504 | ) |  |
Mexico City |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Puente Grande Distribution Center |  |  | 1 |  |  |  |  |  | 9,106 |  |  |  | - |  |  |  | 15,795 |  |  |  | 9,106 |  |  |  | 15,795 |  |  |  | 24,901 |  |  |  | (137 | ) |  | 2014
Mexico City |  |  | 1 |  |  |  |  |  | 9,106 |  |  |  | - |  |  |  | 15,795 |  |  |  | 9,106 |  |  |  | 15,795 |  |  |  | 24,901 |  |  |  | (137 | ) |  |
Canada - Toronto |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Airport Rd. Dist Ctr |  |  | 1 |  |  |  |  |  | 26,084 |  |  |  | 73,382 |  |  |  | 2,343 |  |  |  | 27,262 |  |  |  | 74,547 |  |  |  | 101,809 |  |  |  | (7,860 | ) |  | 2011
Annagem Dist. Center |  |  | 1 |  |  |  |  |  | 3,518 |  |  |  | 12,035 |  |  |  | 850 |  |  |  | 3,677 |  |  |  | 12,726 |  |  |  | 16,403 |  |  |  | (1,394 | ) |  | 2011
Annagem Distrib Centre II |  |  | 1 |  |  |  |  |  | 1,981 |  |  |  | 5,076 |  |  |  | 873 |  |  |  | 2,070 |  |  |  | 5,860 |  |  |  | 7,930 |  |  |  | (708 | ) |  | 2011
Bolton Distribution Center |  |  | 1 |  |  |  |  |  | 7,973 |  |  |  | - |  |  |  | 24,803 |  |  |  | 8,333 |  |  |  | 24,443 |  |  |  | 32,776 |  |  |  | (2,890 | ) |  | 2009
Keele Distribution Center |  |  | 1 |  |  |  |  |  | 1,239 |  |  |  | 4,972 |  |  |  | 529 |  |  |  | 1,295 |  |  |  | 5,445 |  |  |  | 6,740 |  |  |  | (823 | ) |  | 2011
Meadowvale Dist Ctr |  |  | 1 |  |  |  |  |  | 14,647 |  |  |  | - |  |  |  | 21,297 |  |  |  | 15,027 |  |  |  | 20,917 |  |  |  | 35,944 |  |  |  | (135 | ) |  | 2014
Millcreek Distribution Ctr |  |  | 2 |  |  |  |  |  | 8,630 |  |  |  | 32,829 |  |  |  | 688 |  |  |  | 9,020 |  |  |  | 33,127 |  |  |  | 42,147 |  |  |  | (3,612 | ) |  | 2011
Milton 401 Bus. Park |  |  | 1 |  |  |  |  |  | 6,733 |  |  |  | 22,057 |  |  |  | 3,087 |  |  |  | 7,036 |  |  |  | 24,841 |  |  |  | 31,877 |  |  |  | (2,985 | ) |  | 2011
Milton 402 Bus Park |  |  | 2 |  |  |  |  |  | 11,044 |  |  |  | 37,861 |  |  |  | 868 |  |  |  | 11,416 |  |  |  | 38,357 |  |  |  | 49,773 |  |  |  | (2,412 | ) |  | 2011, 2014
Milton Crossings Bus Pk |  |  | 2 |  |  |  |  |  | 19,664 |  |  |  | 47,864 |  |  |  | 3,555 |  |  |  | 20,551 |  |  |  | 50,532 |  |  |  | 71,083 |  |  |  | (5,415 | ) |  | 2011
Mississauga Gateway Center |  |  | 6 |  |  |  |  |  | 54,233 |  |  |  | 132,288 |  |  |  | 830 |  |  |  | 54,509 |  |  |  | 132,842 |  |  |  | 187,351 |  |  |  | (2,398 | ) |  | 2008, 2014
Pearson Logist. Ctr |  |  | 2 |  |  |  |  |  | 12,545 |  |  |  | 44,969 |  |  |  | 1,381 |  |  |  | 13,111 |  |  |  | 45,784 |  |  |  | 58,895 |  |  |  | (4,815 | ) |  | 2011
Canada |  |  | 21 |  |  |  |  |  | 168,291 |  |  |  | 413,333 |  |  |  | 61,104 |  |  |  | 173,307 |  |  |  | 469,421 |  |  |  | 642,728 |  |  |  | (35,447 | ) |  |
Subtotal North American Markets: |  |  | 1,542 |  |  |  |  |  | 3,903,706 |  |  |  | 11,363,912 |  |  |  | 2,316,367 |  |  |  | 4,004,395 |  |  |  | 13,579,590 |  |  |  | 17,583,985 |  |  |  | (2,631,273 | ) |  |
European Markets |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Austria |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Himberg DC |  |  | 1 |  |  |  |  |  | 3,714 |  |  |  | - |  |  |  | 5,872 |  |  |  | 3,724 |  |  |  | 5,862 |  |  |  | 9,586 |  |  |  | (571 | ) |  | 2011
Austria |  |  | 1 |  |  |  |  |  | 3,714 |  |  |  | - |  |  |  | 5,872 |  |  |  | 3,724 |  |  |  | 5,862 |  |  |  | 9,586 |  |  |  | (571 | ) |  |
Belgium |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Boom Distribution Ct |  |  | 1 |  |  |  |  |  | 13,672 |  |  |  | 18,478 |  |  |  | 81 |  |  |  | 13,672 |  |  |  | 18,559 |  |  |  | 32,231 |  |  |  | (2,090 | ) |  | 2011
Belgium |  |  | 1 |  |  |  |  |  | 13,672 |  |  |  | 18,478 |  |  |  | 81 |  |  |  | 13,672 |  |  |  | 18,559 |  |  |  | 32,231 |  |  |  | (2,090 | ) |  |
Czech Republic |  |  |  |  |  |  |  |  |  |  |  |
Uzice Distribution Center |  |  | 1 |  |  |  |  |  | 2,701 |  |  |  | - |  |  |  | 17,441 |  |  |  | 2,701 |  |  |  | 17,441 |  |  |  | 20,142 |  |  |  | (3,517 | ) |  | 2007
Czech Republic |  |  | 1 |  |  |  |  |  | 2,701 |  |  |  | - |  |  |  | 17,441 |  |  |  | 2,701 |  |  |  | 17,441 |  |  |  | 20,142 |  |  |  | (3,517 | ) |  |
France |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Bonneuil Distribution Center |  |  | 1 |  |  |  |  |  | - |  |  |  | - |  |  |  | 16,587 |  |  |  | - |  |  |  | 16,587 |  |  |  | 16,587 |  |  |  | (3,852 | ) |  | 2012
Isle d’Abeau Distribution Center |  |  | 1 |  |  |  |  |  | 3,175 |  |  |  | 14,247 |  |  |  | 3,428 |  |  |  | 4,332 |  |  |  | 16,518 |  |  |  | 20,850 |  |  |  | (2,493 | ) |  | 2011
LGR Genevill. 1 SAS |  |  | 1 |  |  |  |  |  | 2,237 |  |  |  | 2,427 |  |  |  | 817 |  |  |  | 2,237 |  |  |  | 3,244 |  |  |  | 5,481 |  |  |  | (326 | ) |  | 2011
LGR Genevill. 2 SAS |  |  | 1 |  |  |  |  |  | 1,720 |  |  |  | 3,564 |  |  |  | 41 |  |  |  | 1,720 |  |  |  | 3,605 |  |  |  | 5,325 |  |  |  | (349 | ) |  | 2011
Moissy II Distribution Center |  |  | 1 |  |  |  |  |  | 5,551 |  |  |  | - |  |  |  | 7,454 |  |  |  | 5,501 |  |  |  | 7,504 |  |  |  | 13,005 |  |  |  | (93 | ) |  | 2014
Port of Rouen |  |  | 1 |  |  |  |  |  | - |  |  |  | 15,480 |  |  |  | 88 |  |  |  | - |  |  |  | 15,568 |  |  |  | 15,568 |  |  |  | (2,054 | ) |  | 2011
Vemars Distribution Center |  |  | 1 |  |  |  |  |  | 8,300 |  |  |  | - |  |  |  | 12,679 |  |  |  | 8,300 |  |  |  | 12,679 |  |  |  | 20,979 |  |  |  | (210 | ) |  | 2014
France |  |  | 7 |  |  |  |  |  | 20,983 |  |  |  | 35,718 |  |  |  | 41,094 |  |  |  | 22,090 |  |  |  | 75,705 |  |  |  | 97,795 |  |  |  | (9,377 | ) |  |
Germany |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Hausbruch Ind Ctr 4-B |  |  | 1 |  |  |  |  |  | 8,294 |  |  |  | 5,395 |  |  |  | 130 |  |  |  | 8,294 |  |  |  | 5,525 |  |  |  | 13,819 |  |  |  | (1,571 | ) |  | 2011
Hausbruch Ind Ctr 5-650 |  |  | 1 |  |  |  |  |  | 2,986 |  |  |  | 460 |  |  |  | 244 |  |  |  | 2,986 |  |  |  | 704 |  |  |  | 3,690 |  |  |  | (120 | ) |  | 2011
Huenxe Dist Ctr |  |  | 1 |  |  |  |  |  | 2,062 |  |  |  | - |  |  |  | 9,220 |  |  |  | 1,587 |  |  |  | 9,695 |  |  |  | 11,282 |  |  |  | (572 | ) |  | 2012
Kolleda Distribution Center |  |  | 1 |  |  |  |  |  | 257 |  |  |  | 3,974 |  |  |  | (318 | ) |  |  | 257 |  |  |  | 3,656 |  |  |  | 3,913 |  |  |  | (514 | ) |  | 2008
Lauenau Dist Ctr |  |  | 1 |  |  |  |  |  | 2,784 |  |  |  | 6,197 |  |  |  | 296 |  |  |  | 2,784 |  |  |  | 6,493 |  |  |  | 9,277 |  |  |  | (819 | ) |  | 2011
Meerane Distribution Center |  |  | 1 |  |  |  |  |  | 686 |  |  |  | 5,274 |  |  |  | (242 | ) |  |  | 686 |  |  |  | 5,032 |  |  |  | 5,718 |  |  |  | (670 | ) |  | 2008
Muggensturm |  |  | 2 |  |  |  |  |  | 3,533 |  |  |  | 14,328 |  |  |  | 128 |  |  |  | 3,533 |  |  |  | 14,456 |  |  |  | 17,989 |  |  |  | (1,876 | ) |  | 2011
Germany |  |  | 8 |  |  |  |  |  | 20,602 |  |  |  | 35,628 |  |  |  | 9,458 |  |  |  | 20,127 |  |  |  | 45,561 |  |  |  | 65,688 |  |  |  | (6,142 | ) |  |

107

##### Table of Contents

PROLOGIS, INC. AND PROLOGIS, L.P.

SCHEDULE III – REAL ESTATE AND ACCUMULATED DEPRECIATION

DECEMBER 31, 2014

(In thousands of U.S. dollars, as applicable)

|  | No. of Bldgs. |  |  |  |  | Initial Cost to Prologis |  |  | Costs Capitalized Subsequent To Acquisition |  |  | Gross Amounts At Which Carried at December 31, 2014 |  |  | Accumulated Depreciation (c) |  |  | Date of Construction/ Acquisition
Description |  |  | Encum- brances |  | Land |  |  | Building & Improvements |  |  |  | Land |  |  | Building & Improvements |  |  | Total (a,b) |  |  |
Hungary |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Budapest-Sziget Dist. Center |  |  | 2 |  |  |  |  |  | 3,361 |  |  |  | 8,768 |  |  |  | 5,588 |  |  |  | 3,399 |  |  |  | 14,318 |  |  |  | 17,717 |  |  |  | (1,125 | ) |  | 2008, 2014
Hungary |  |  | 2 |  |  |  |  |  | 3,361 |  |  |  | 8,768 |  |  |  | 5,588 |  |  |  | 3,399 |  |  |  | 14,318 |  |  |  | 17,717 |  |  |  | (1,125 | ) |  |
Italy |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Arena Po Dist Ctr |  |  | 2 |  |  |  |  |  | 8,275 |  |  |  | 22,399 |  |  |  | 103 |  |  |  | 8,275 |  |  |  | 22,502 |  |  |  | 30,777 |  |  |  | (3,939 | ) |  | 2011
Castel San Giovanni Dist Ctr |  |  | 1 |  |  |  |  |  | 3,439 |  |  |  | 10,501 |  |  |  | 146 |  |  |  | 3,439 |  |  |  | 10,647 |  |  |  | 14,086 |  |  |  | (1,460 | ) |  | 2011
Siziano Logis Park |  |  | 1 |  |  |  |  |  | 10,985 |  |  |  | 19,914 |  |  |  | 838 |  |  |  | 10,985 |  |  |  | 20,752 |  |  |  | 31,737 |  |  |  | (2,412 | ) |  | 2011
Italy |  |  | 4 |  |  |  |  |  | 22,699 |  |  |  | 52,814 |  |  |  | 1,087 |  |  |  | 22,699 |  |  |  | 53,901 |  |  |  | 76,600 |  |  |  | (7,811 | ) |  |
Poland |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Nadarzyn Distribution Center |  |  | 1 |  |  |  |  |  | 2,511 |  |  |  | - |  |  |  | 7,733 |  |  |  | 2,508 |  |  |  | 7,736 |  |  |  | 10,244 |  |  |  | (1,138 | ) |  | 2009
Piotrkow II Distribution Center |  |  | 1 |  |  |  |  |  | 1,633 |  |  |  | - |  |  |  | 5,564 |  |  |  | 1,590 |  |  |  | 5,607 |  |  |  | 7,197 |  |  |  | (947 | ) |  | 2009
Sochaczew Distribution Center. |  |  | 2 |  |  |  |  |  | 133 |  |  |  | 11,797 |  |  |  | 1,997 |  |  |  | 773 |  |  |  | 13,154 |  |  |  | 13,927 |  |  |  | (2,430 | ) |  | 2008
Szczecin Distribution Center |  |  | 1 |  |  |  |  |  | 310 |  |  |  | - |  |  |  | 4,419 |  |  |  | 310 |  |  |  | 4,419 |  |  |  | 4,729 |  |  |  | (32 | ) |  | 2014
Teresin Dist Ctr |  |  | 2 |  |  |  |  |  | 3,395 |  |  |  | 17,739 |  |  |  | 951 |  |  |  | 4,024 |  |  |  | 18,061 |  |  |  | 22,085 |  |  |  | (2,486 | ) |  | 2011
Wroclaw V DC |  |  | 3 |  |  |  |  |  | 8,687 |  |  |  | - |  |  |  | 32,462 |  |  |  | 8,687 |  |  |  | 32,462 |  |  |  | 41,149 |  |  |  | (944 | ) |  | 2013, 2014
Poland |  |  | 10 |  |  |  |  |  | 16,669 |  |  |  | 29,536 |  |  |  | 53,126 |  |  |  | 17,892 |  |  |  | 81,439 |  |  |  | 99,331 |  |  |  | (7,977 | ) |  |
Romania |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Bucharest Distribution Center |  |  | 4 |  |  |  |  |  | 7,007 |  |  |  | 30,630 |  |  |  | 11,642 |  |  |  | 8,758 |  |  |  | 40,521 |  |  |  | 49,279 |  |  |  | (7,729 | ) |  | 2007, 2008
Romania |  |  | 4 |  |  |  |  |  | 7,007 |  |  |  | 30,630 |  |  |  | 11,642 |  |  |  | 8,758 |  |  |  | 40,521 |  |  |  | 49,279 |  |  |  | (7,729 | ) |  |
Slovakia |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Bratislava Distribution Center |  |  | 1 |  |  |  |  |  | 2,393 |  |  |  | - |  |  |  | 10,840 |  |  |  | 2,393 |  |  |  | 10,840 |  |  |  | 13,233 |  |  |  | (346 | ) |  | 2012
Sered Distribution Center |  |  | 1 |  |  |  |  |  | 2,424 |  |  |  | - |  |  |  | 13,139 |  |  |  | 2,424 |  |  |  | 13,139 |  |  |  | 15,563 |  |  |  | (1,791 | ) |  | 2009
Slovakia |  |  | 2 |  |  |  |  |  | 4,817 |  |  |  | - |  |  |  | 23,979 |  |  |  | 4,817 |  |  |  | 23,979 |  |  |  | 28,796 |  |  |  | (2,137 | ) |  |
Spain |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Barajas MAD Logistics |  |  | 4 |  |  |  |  |  | - |  |  |  | 39,276 |  |  |  | 937 |  |  |  | - |  |  |  | 40,213 |  |  |  | 40,213 |  |  |  | (5,759 | ) |  | 2011
Spain |  |  | 4 |  |  |  |  |  | - |  |  |  | 39,276 |  |  |  | 937 |  |  |  | - |  |  |  | 40,213 |  |  |  | 40,213 |  |  |  | (5,759 | ) |  |
Sweden |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Orebro Dist Ctr |  |  | 1 |  |  |  |  |  | 10,064 |  |  |  | 22,004 |  |  |  | 2,196 |  |  |  | 10,064 |  |  |  | 24,200 |  |  |  | 34,264 |  |  |  | (4,551 | ) |  | 2011
Sweden |  |  | 1 |  |  |  |  |  | 10,064 |  |  |  | 22,004 |  |  |  | 2,196 |  |  |  | 10,064 |  |  |  | 24,200 |  |  |  | 34,264 |  |  |  | (4,551 | ) |  |
United Kingdom |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Midpoint Park |  |  | 2 |  |  |  |  |  | 31,375 |  |  |  | 12,061 |  |  |  | 19,207 |  |  |  | 31,407 |  |  |  | 31,236 |  |  |  | 62,643 |  |  |  | (1,972 | ) |  | 2008, 2013
North Kettering Bus Pk |  |  | 1 |  |  |  |  |  | 2,518 |  |  |  | 7,477 |  |  |  | 7,187 |  |  |  | 3,759 |  |  |  | 13,423 |  |  |  | 17,182 |  |  |  | (3,634 | ) |  | 2007
United Kingdom |  |  | 3 |  |  |  |  |  | 33,893 |  |  |  | 19,538 |  |  |  | 26,394 |  |  |  | 35,166 |  |  |  | 44,659 |  |  |  | 79,825 |  |  |  | (5,606 | ) |  |
Subtotal European Markets: |  |  | 48 |  |  |  |  |  | 160,182 |  |  |  | 292,390 |  |  |  | 198,895 |  |  |  | 165,109 |  |  |  | 486,358 |  |  |  | 651,467 |  |  |  | (64,392 | ) |  |
Asia Markets |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
China |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Dalian Ind. Park DC |  |  | 1 |  |  |  |  |  | 2,538 |  |  |  | 14,543 |  |  |  | 108 |  |  |  | 2,443 |  |  |  | 14,746 |  |  |  | 17,189 |  |  |  | (1,468 | ) |  | 2011
Fengxian Logistics C |  |  | 3 |  |  |  |  |  | - |  |  |  | 13,773 |  |  |  | 624 |  |  |  | - |  |  |  | 14,397 |  |  |  | 14,397 |  |  |  | (3,566 | ) |  | 2011
Jiaxing Distri Ctr |  |  | 4 |  |  |  |  |  | 11,454 |  |  |  | 11,104 |  |  |  | 14,288 |  |  |  | 11,103 |  |  |  | 25,743 |  |  |  | 36,846 |  |  |  | (1,625 | ) |  | 2011, 2013
Tianjin Bonded LP |  |  | 2 |  |  |  |  |  | 1,565 |  |  |  | 9,485 |  |  |  | 58 |  |  |  | 1,502 |  |  |  | 9,606 |  |  |  | 11,108 |  |  |  | (1,090 | ) |  | 2011
China |  |  | 10 |  |  |  |  |  | 15,557 |  |  |  | 48,905 |  |  |  | 15,078 |  |  |  | 15,048 |  |  |  | 64,492 |  |  |  | 79,540 |  |  |  | (7,749 | ) |  |
Japan |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
ProLogis Park Aichi Distribution Center |  |  | 1 |  |  |  |  |  | 18,428 |  |  |  | - |  |  |  | 74,195 |  |  |  | 24,691 |  |  |  | 67,932 |  |  |  | 92,623 |  |  |  | (12,927 | ) |  | 2007
ProLogis Park Narita III |  |  | 1 |  |  |  |  |  | 17,145 |  |  |  | 60,785 |  |  |  | 9,604 |  |  |  | 18,394 |  |  |  | 69,140 |  |  |  | 87,534 |  |  |  | (9,674 | ) |  | 2008
Japan |  |  | 2 |  |  |  |  |  | 35,573 |  |  |  | 60,785 |  |  |  | 83,799 |  |  |  | 43,085 |  |  |  | 137,072 |  |  |  | 180,157 |  |  |  | (22,601 | ) |  |
Singapore |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Airport Logistics Center 3 |  |  | 1 |  |  |  |  |  | - |  |  |  | 25,736 |  |  |  | 121 |  |  |  | - |  |  |  | 25,857 |  |  |  | 25,857 |  |  |  | (4,124 | ) |  | 2011
Changi South Distr Ctr 1 |  |  | 1 |  |  |  |  |  | - |  |  |  | 41,942 |  |  |  | 113 |  |  |  | - |  |  |  | 42,055 |  |  |  | 42,055 |  |  |  | (6,144 | ) |  | 2011
Changi-North DC1 |  |  | 1 |  |  |  |  |  | - |  |  |  | 13,877 |  |  |  | 1,844 |  |  |  | - |  |  |  | 15,721 |  |  |  | 15,721 |  |  |  | (2,108 | ) |  | 2011
Singapore Airport Logist Ctr 2 |  |  | 1 |  |  |  |  |  | - |  |  |  | 37,267 |  |  |  | 201 |  |  |  | - |  |  |  | 37,468 |  |  |  | 37,468 |  |  |  | (5,983 | ) |  | 2011
Tuas Distribution Center |  |  | 1 |  |  |  |  |  | - |  |  |  | 18,929 |  |  |  | 273 |  |  |  | - |  |  |  | 19,202 |  |  |  | 19,202 |  |  |  | (4,461 | ) |  | 2011
Singapore |  |  | 5 |  |  |  |  |  | - |  |  |  | 137,751 |  |  |  | 2,552 |  |  |  | - |  |  |  | 140,303 |  |  |  | 140,303 |  |  |  | (22,820 | ) |  |
Subtotal Asian Markets: |  |  | 17 |  |  |  |  |  | 51,130 |  |  |  | 247,441 |  |  |  | 101,429 |  |  |  | 58,133 |  |  |  | 341,867 |  |  |  | 400,000 |  |  |  | (53,170 | ) |  |
Total Industrial Operating Properties: |  |  | 1,607 |  |  |  |  |  | 4,115,018 |  |  |  | 11,903,743 |  |  |  | 2,616,691 |  |  |  | 4,227,637 |  |  |  | 14,407,815 |  |  |  | 18,635,452 |  |  |  | (2,748,835 | ) |  |

108

##### Table of Contents

PROLOGIS, INC. AND PROLOGIS, L.P.

SCHEDULE III – REAL ESTATE AND ACCUMULATED DEPRECIATION

DECEMBER 31, 2014

(In thousands of U.S. dollars, as applicable)

|  | No. of Bldgs. |  |  |  |  | Initial Cost to Prologis |  |  | Costs Capitalized Subsequent To Acquisition |  |  | Gross Amounts At Which Carried at December 31, 2014 |  |  | Accumulated Depreciation (c) |  | Date of Construction/ Acquisition
Description |  |  | Encum- brances |  | Land |  |  | Building & Improvements |  |  |  | Land |  |  | Building & Improvements |  |  | Total (a,b) |  |  |
Development Portfolio |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
North American Markets: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
United States: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Atlanta, Georgia |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Park I-85 |  |  | 1 |  |  |  |  |  | 3,493 |  |  |  | - |  |  |  | 1,643 |  |  |  | 3,493 |  |  |  | 1,643 |  |  |  | 5,136 |  |  |  |  |
Atlanta, Georgia |  |  | 1 |  |  |  |  |  | 3,493 |  |  |  | - |  |  |  | 1,643 |  |  |  | 3,493 |  |  |  | 1,643 |  |  |  | 5,136 |  |  |  |  |
Boston, Massachusetts |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Londonderry |  |  | 1 |  |  |  |  |  | 10,808 |  |  |  | - |  |  |  | 22,717 |  |  |  | 10,808 |  |  |  | 22,717 |  |  |  | 33,525 |  |  |  |  |
Boston, Massachusetts |  |  | 1 |  |  |  |  |  | 10,808 |  |  |  | - |  |  |  | 22,717 |  |  |  | 10,808 |  |  |  | 22,717 |  |  |  | 33,525 |  |  |  |  |
Central & Eastern, Pennsylvania |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Carlisle Dist Ctr |  |  | 1 |  |  |  |  |  | 13,931 |  |  |  | - |  |  |  | 5,963 |  |  |  | 13,931 |  |  |  | 5,963 |  |  |  | 19,894 |  |  |  |  |
I-81 Dist Ctr |  |  | 1 |  |  |  |  |  | 6,416 |  |  |  | - |  |  |  | 11,128 |  |  |  | 6,416 |  |  |  | 11,128 |  |  |  | 17,544 |  |  |  |  |
Lehigh Valley Distribution Center |  |  | 1 |  |  |  |  |  | 2,897 |  |  |  | - |  |  |  | 1,213 |  |  |  | 2,897 |  |  |  | 1,213 |  |  |  | 4,110 |  |  |  |  |
Central & Eastern, Pennsylvania |  |  | 3 |  |  |  |  |  | 23,244 |  |  |  | - |  |  |  | 18,304 |  |  |  | 23,244 |  |  |  | 18,304 |  |  |  | 41,548 |  |  |  |  |
Central Valley, CA |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Patterson Pass Business Center |  |  | 1 |  |  |  |  |  | - |  |  |  | - |  |  |  | 12,234 |  |  |  | - |  |  |  | 12,234 |  |  |  | 12,234 |  |  |  |  |
Central Valley, CA |  |  | 1 |  |  |  |  |  | - |  |  |  | - |  |  |  | 12,234 |  |  |  | - |  |  |  | 12,234 |  |  |  | 12,234 |  |  |  |  |
Charlotte, North Carolina |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
West Pointe Business Center |  |  | 1 |  |  |  |  |  | 790 |  |  |  | - |  |  |  | 1,819 |  |  |  | 790 |  |  |  | 1,819 |  |  |  | 2,609 |  |  |  |  |
Charlotte, North Carolina |  |  | 1 |  |  |  |  |  | 790 |  |  |  | - |  |  |  | 1,819 |  |  |  | 790 |  |  |  | 1,819 |  |  |  | 2,609 |  |  |  |  |
Chicago, Illinois |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Bolingbrook Distribution Center |  |  | 1 |  |  |  |  |  | 3,926 |  |  |  | - |  |  |  | 9,937 |  |  |  | 3,926 |  |  |  | 9,937 |  |  |  | 13,863 |  |  |  |  |
Chicago, Illinois |  |  | 1 |  |  |  |  |  | 3,926 |  |  |  | - |  |  |  | 9,937 |  |  |  | 3,926 |  |  |  | 9,937 |  |  |  | 13,863 |  |  |  |  |
Columbus, Ohio |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Etna Distribution Center |  |  | 1 |  |  |  |  |  | 1,167 |  |  |  | - |  |  |  | 12,811 |  |  |  | 1,167 |  |  |  | 12,811 |  |  |  | 13,978 |  |  |  |  | 2014
Columbus, Ohio |  |  | 1 |  |  |  |  |  | 1,167 |  |  |  | - |  |  |  | 12,811 |  |  |  | 1,167 |  |  |  | 12,811 |  |  |  | 13,978 |  |  |  |  |
Dallas/Fort Worth, Texas |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Dallas Corporate Center North Distribution Center |  |  | 2 |  |  |  |  |  | 4,430 |  |  |  | - |  |  |  | 993 |  |  |  | 4,430 |  |  |  | 993 |  |  |  | 5,423 |  |  |  |  |
Freeport Corp Ctr |  |  | 1 |  |  |  |  |  | 458 |  |  |  | - |  |  |  | 6,628 |  |  |  | 458 |  |  |  | 6,628 |  |  |  | 7,086 |  |  |  |  | 2014
Mountain Creek |  |  | 1 |  |  |  |  |  | - |  |  |  | - |  |  |  | 4,012 |  |  |  | - |  |  |  | 4,012 |  |  |  | 4,012 |  |  |  |  |
Dallas/Fort Worth, Texas |  |  | 4 |  |  |  |  |  | 4,888 |  |  |  | - |  |  |  | 11,633 |  |  |  | 4,888 |  |  |  | 11,633 |  |  |  | 16,521 |  |  |  |  |
Denver, Colorado |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Stapleton Bus Ctr North |  |  | 2 |  |  |  |  |  | 7,149 |  |  |  | - |  |  |  | 30,482 |  |  |  | 7,149 |  |  |  | 30,482 |  |  |  | 37,631 |  |  |  |  | 2014
Denver, Colorado |  |  | 2 |  |  |  |  |  | 7,149 |  |  |  | - |  |  |  | 30,482 |  |  |  | 7,149 |  |  |  | 30,482 |  |  |  | 37,631 |  |  |  |  |
El Paso, Texas |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Northwestern Corporate Center |  |  | 1 |  |  |  |  |  | 768 |  |  |  | - |  |  |  | 2,203 |  |  |  | 768 |  |  |  | 2,203 |  |  |  | 2,971 |  |  |  |  |
El Paso, Texas |  |  | 1 |  |  |  |  |  | 768 |  |  |  | - |  |  |  | 2,203 |  |  |  | 768 |  |  |  | 2,203 |  |  |  | 2,971 |  |  |  |  |
Houston, Texas |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Northpark Distribution Center |  |  | 2 |  |  |  |  |  | 2,012 |  |  |  | - |  |  |  | 10,411 |  |  |  | 2,012 |  |  |  | 10,411 |  |  |  | 12,423 |  |  |  |  | 2014
Houston, Texas |  |  | 2 |  |  |  |  |  | 2,012 |  |  |  | - |  |  |  | 10,411 |  |  |  | 2,012 |  |  |  | 10,411 |  |  |  | 12,423 |  |  |  |  |
Las Vegas, Nevada |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Las Vegas Corporate Center |  |  | 1 |  |  |  |  |  | 2,881 |  |  |  | - |  |  |  | 7,655 |  |  |  | 2,881 |  |  |  | 7,655 |  |  |  | 10,536 |  |  |  |  |
Las Vegas, Nevada |  |  | 1 |  |  |  |  |  | 2,881 |  |  |  | - |  |  |  | 7,655 |  |  |  | 2,881 |  |  |  | 7,655 |  |  |  | 10,536 |  |  |  |  |
Memphis, Tennessee |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
DeSoto Distribution Center |  |  | 1 |  |  |  |  |  | 938 |  |  |  | - |  |  |  | 8,168 |  |  |  | 938 |  |  |  | 8,168 |  |  |  | 9,106 |  |  |  |  | 2014
Memphis, Tennessee |  |  | 1 |  |  |  |  |  | 938 |  |  |  | - |  |  |  | 8,168 |  |  |  | 938 |  |  |  | 8,168 |  |  |  | 9,106 |  |  |  |  |
New Jersey |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Port Reading Business Park |  |  | 4 |  |  |  |  |  | 56,803 |  |  |  | - |  |  |  | 92,208 |  |  |  | 56,803 |  |  |  | 92,208 |  |  |  | 149,011 |  |  |  |  | 2014
New Jersey |  |  | 4 |  |  |  |  |  | 56,803 |  |  |  | - |  |  |  | 92,208 |  |  |  | 56,803 |  |  |  | 92,208 |  |  |  | 149,011 |  |  |  |  |
Orlando, Florida |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Beltway Commerce Center |  |  | 1 |  |  |  |  |  | 1,485 |  |  |  | - |  |  |  | 4,814 |  |  |  | 1,485 |  |  |  | 4,814 |  |  |  | 6,299 |  |  |  |  |
Orlando, Florida |  |  | 1 |  |  |  |  |  | 1,485 |  |  |  | - |  |  |  | 4,814 |  |  |  | 1,485 |  |  |  | 4,814 |  |  |  | 6,299 |  |  |  |  |

109

##### Table of Contents

PROLOGIS, INC. AND PROLOGIS, L.P.

SCHEDULE III – REAL ESTATE AND ACCUMULATED DEPRECIATION

DECEMBER 31, 2014

(In thousands of U.S. dollars, as applicable)

|  | No. of Bldgs. |  |  |  |  | Initial Cost to Prologis |  |  | Costs Capitalized Subsequent To Acquisition |  |  | Gross Amounts At Which Carried at December 31, 2014 |  |  | Accumulated Depreciation (c) |  | Date of Construction/ Acquisition |
Description |  |  | Encum- brances |  | Land |  |  | Building & Improvements |  |  |  | Land |  |  | Building & Improvements |  |  | Total (a,b) |  |  |
Portland, Oregon |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Southshore Corporate Center |  |  | 1 |  |  |  |  |  | 1,003 |  |  |  | - |  |  |  | 9,986 |  |  |  | 1,003 |  |  |  | 9,986 |  |  |  | 10,989 |  |  |  |  |  |  |
Portland, Oregon |  |  | 1 |  |  |  |  |  | 1,003 |  |  |  | - |  |  |  | 9,986 |  |  |  | 1,003 |  |  |  | 9,986 |  |  |  | 10,989 |  |  |  |  |  |  |
South Florida |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Beacon Lakes |  |  | 2 |  |  |  |  |  | 7,369 |  |  |  | - |  |  |  | 17,464 |  |  |  | 7,369 |  |  |  | 17,464 |  |  |  | 24,833 |  |  |  |  |  | 2014 |
South Florida |  |  | 2 |  |  |  |  |  | 7,369 |  |  |  | - |  |  |  | 17,464 |  |  |  | 7,369 |  |  |  | 17,464 |  |  |  | 24,833 |  |  |  |  |  |  |
Southern California |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
CAT - Kaiser Comm Ctr |  |  | 1 |  |  |  |  |  | 4,851 |  |  |  | - |  |  |  | 2,648 |  |  |  | 4,851 |  |  |  | 2,648 |  |  |  | 7,499 |  |  |  |  |  |  |
International Multifoods |  |  | 1 |  |  |  |  |  | 4,700 |  |  |  | - |  |  |  | 9,135 |  |  |  | 4,700 |  |  |  | 9,135 |  |  |  | 13,835 |  |  |  |  |  |  |
Redlands Distribution Center |  |  | 1 |  |  |  |  |  | 16,628 |  |  |  | - |  |  |  | 24,565 |  |  |  | 16,628 |  |  |  | 24,565 |  |  |  | 41,193 |  |  |  |  |  | 2014 |
Rialto Dist Ctr |  |  | 1 |  |  |  |  |  | 13,026 |  |  |  | - |  |  |  | 8,502 |  |  |  | 13,026 |  |  |  | 8,502 |  |  |  | 21,528 |  |  |  |  |  |  |
Southern California |  |  | 4 |  |  |  |  |  | 39,205 |  |  |  | - |  |  |  | 44,850 |  |  |  | 39,205 |  |  |  | 44,850 |  |  |  | 84,055 |  |  |  |  |  |  |
Mexico |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Centro Industrial Center |  |  | 1 |  |  |  |  |  | 1,252 |  |  |  | - |  |  |  | 270 |  |  |  | 1,252 |  |  |  | 270 |  |  |  | 1,522 |  |  |  |  |  |  |
El Puente Industrial Center |  |  | 1 |  |  |  |  |  | 1,767 |  |  |  | - |  |  |  | 4,944 |  |  |  | 1,767 |  |  |  | 4,944 |  |  |  | 6,711 |  |  |  |  |  |  |
Los Altos Ind Park |  |  | 1 |  |  |  |  |  | 2,586 |  |  |  | - |  |  |  | 8,421 |  |  |  | 2,586 |  |  |  | 8,421 |  |  |  | 11,007 |  |  |  |  |  | 2014 |
Monterrey Airport |  |  | 1 |  |  |  |  |  | 11,917 |  |  |  | - |  |  |  | 12,850 |  |  |  | 11,917 |  |  |  | 12,850 |  |  |  | 24,767 |  |  |  |  |  |  |
PDX Corporate Center North/South |  |  | 1 |  |  |  |  |  | 14,493 |  |  |  | - |  |  |  | 10,850 |  |  |  | 14,493 |  |  |  | 10,850 |  |  |  | 25,343 |  |  |  |  |  |  |
Toluca Distribution Center |  |  | 1 |  |  |  |  |  | 5,336 |  |  |  | - |  |  |  | 3,492 |  |  |  | 5,336 |  |  |  | 3,492 |  |  |  | 8,828 |  |  |  |  |  |  |
Tres Rios |  |  | 2 |  |  |  |  |  | 8,364 |  |  |  | - |  |  |  | 13,627 |  |  |  | 8,364 |  |  |  | 13,627 |  |  |  | 21,991 |  |  |  |  |  | 2014 |
Mexico |  |  | 8 |  |  |  |  |  | 45,715 |  |  |  | - |  |  |  | 54,454 |  |  |  | 45,715 |  |  |  | 54,454 |  |  |  | 100,169 |  |  |  |  |  |  |
Canada |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Meadowvale Dist Ctr |  |  | 1 |  |  |  |  |  | 21,456 |  |  |  | - |  |  |  | 28,624 |  |  |  | 21,456 |  |  |  | 28,624 |  |  |  | 50,080 |  |  |  |  |  | 2014 |
Milton 402 Bus Park |  |  | 3 |  |  |  |  |  | 10,311 |  |  |  | - |  |  |  | 33 |  |  |  | 10,311 |  |  |  | 33 |  |  |  | 10,344 |  |  |  |  |  |  |
Tapscott Dist Ctr |  |  | 1 |  |  |  |  |  | 3,110 |  |  |  | - |  |  |  | 4,227 |  |  |  | 3,110 |  |  |  | 4,227 |  |  |  | 7,337 |  |  |  |  |  |  |
Canada |  |  | 5 |  |  |  |  |  | 34,877 |  |  |  | - |  |  |  | 32,884 |  |  |  | 34,877 |  |  |  | 32,884 |  |  |  | 67,761 |  |  |  |  |  |  |
Subtotal North American Markets: |  |  | 45 |  |  |  |  |  | 248,521 |  |  |  | - |  |  |  | 406,677 |  |  |  | 248,521 |  |  |  | 406,677 |  |  |  | 655,198 |  |  |  |  |  |  |
European Markets |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Czech Republic |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Prague Airport Distribution Center |  |  | 2 |  |  |  |  |  | 5,087 |  |  |  | - |  |  |  | 8,737 |  |  |  | 5,087 |  |  |  | 8,737 |  |  |  | 13,824 |  |  |  |  |  |  |
Prague-Jirny Dist. Ctr |  |  | 2 |  |  |  |  |  | 5,411 |  |  |  | - |  |  |  | 1,911 |  |  |  | 5,411 |  |  |  | 1,911 |  |  |  | 7,322 |  |  |  |  |  |  |
Czech Republic |  |  | 4 |  |  |  |  |  | 10,498 |  |  |  | - |  |  |  | 10,648 |  |  |  | 10,498 |  |  |  | 10,648 |  |  |  | 21,146 |  |  |  |  |  |  |
France |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
LG Roissy Sorbiers SAS |  |  | 1 |  |  |  |  |  | 5,508 |  |  |  | - |  |  |  | 13,600 |  |  |  | 5,508 |  |  |  | 13,600 |  |  |  | 19,108 |  |  |  |  |  |  |
Presles Dist Ctr |  |  | 1 |  |  |  |  |  | 537 |  |  |  | - |  |  |  | 8,656 |  |  |  | 537 |  |  |  | 8,656 |  |  |  | 9,193 |  |  |  |  |  |  |
France |  |  | 2 |  |  |  |  |  | 6,045 |  |  |  | - |  |  |  | 22,256 |  |  |  | 6,045 |  |  |  | 22,256 |  |  |  | 28,301 |  |  |  |  |  |  |
Germany |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Peine Dist Ctr |  |  | 1 |  |  |  |  |  | 3,411 |  |  |  | - |  |  |  | 1,677 |  |  |  | 3,411 |  |  |  | 1,677 |  |  |  | 5,088 |  |  |  |  |  |  |
Germany |  |  | 1 |  |  |  |  |  | 3,411 |  |  |  | - |  |  |  | 1,677 |  |  |  | 3,411 |  |  |  | 1,677 |  |  |  | 5,088 |  |  |  |  |  |  |
Netherlands |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Tilburg Dist Ctr |  |  | 1 |  |  |  |  |  | 5,381 |  |  |  | - |  |  |  | 4,390 |  |  |  | 5,381 |  |  |  | 4,390 |  |  |  | 9,771 |  |  |  |  |  |  |
Venlo Dist. Center. |  |  | 1 |  |  |  |  |  | 7,085 |  |  |  | - |  |  |  | 9,724 |  |  |  | 7,085 |  |  |  | 9,724 |  |  |  | 16,809 |  |  |  |  |  |  |
Netherlands |  |  | 2 |  |  |  |  |  | 12,466 |  |  |  | - |  |  |  | 14,114 |  |  |  | 12,466 |  |  |  | 14,114 |  |  |  | 26,580 |  |  |  |  |  |  |
Poland |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Wroclaw Distribution Center |  |  | 1 |  |  |  |  |  | 3,937 |  |  |  | - |  |  |  | 8,290 |  |  |  | 3,937 |  |  |  | 8,290 |  |  |  | 12,227 |  |  |  |  |  | 2014 |
Wroclaw V DC |  |  | 1 |  |  |  |  |  | 2,787 |  |  |  | - |  |  |  | 9,411 |  |  |  | 2,787 |  |  |  | 9,411 |  |  |  | 12,198 |  |  |  |  |  | 2014 |
Poland |  |  | 2 |  |  |  |  |  | 6,724 |  |  |  | - |  |  |  | 17,701 |  |  |  | 6,724 |  |  |  | 17,701 |  |  |  | 24,425 |  |  |  |  |  |  |
Slovakia |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Bratislava Distribution Center |  |  | 1 |  |  |  |  |  | 1,919 |  |  |  | - |  |  |  | 8,024 |  |  |  | 1,919 |  |  |  | 8,024 |  |  |  | 9,943 |  |  |  |  |  |  |
Slovakia |  |  | 1 |  |  |  |  |  | 1,919 |  |  |  | - |  |  |  | 8,024 |  |  |  | 1,919 |  |  |  | 8,024 |  |  |  | 9,943 |  |  |  |  |  |  |
Spain |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Puerta de Madrid Distribution Center |  |  | 1 |  |  |  |  |  | 7,126 |  |  |  | - |  |  |  | 1,263 |  |  |  | 7,126 |  |  |  | 1,263 |  |  |  | 8,389 |  |  |  |  |  |  |
Spain |  |  | 1 |  |  |  |  |  | 7,126 |  |  |  | - |  |  |  | 1,263 |  |  |  | 7,126 |  |  |  | 1,263 |  |  |  | 8,389 |  |  |  |  |  |  |
Sweden |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Gothenburg Distribution Center |  |  | 1 |  |  |  |  |  | 3,720 |  |  |  | - |  |  |  | 11,953 |  |  |  | 3,720 |  |  |  | 11,953 |  |  |  | 15,673 |  |  |  |  |  | 2014 |
Ljungby Distribution Center |  |  | 1 |  |  |  |  |  | 647 |  |  |  | - |  |  |  | 2,437 |  |  |  | 647 |  |  |  | 2,437 |  |  |  | 3,084 |  |  |  |  |  |  |
Sweden |  |  | 2 |  |  |  |  |  | 4,367 |  |  |  | - |  |  |  | 14,390 |  |  |  | 4,367 |  |  |  | 14,390 |  |  |  | 18,757 |  |  |  |  |  |  |

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PROLOGIS, INC. AND PROLOGIS, L.P.

SCHEDULE III – REAL ESTATE AND ACCUMULATED DEPRECIATION

DECEMBER 31, 2014

(In thousands of U.S. dollars, as applicable)

|  | No. of Bldgs. |  |  |  |  | Initial Cost to Prologis |  |  | Costs Capitalized Subsequent To Acquisition |  |  | Gross Amounts At Which Carried at December 31, 2014 |  |  | Accumulated Depreciation (c) |  |  | Date of Construction/ Acquisition |
Description |  |  | Encum- brances |  | Land |  |  | Building & Improvements |  |  |  | Land |  |  | Building & Improvements |  |  | Total (a,b) |  |  |
United Kingdom |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Boscombe Road Distribution Center |  |  | 1 |  |  |  |  |  | 16,206 |  |  |  | - |  |  |  | 14,850 |  |  |  | 16,206 |  |  |  | 14,850 |  |  |  | 31,056 |  |  |  |  |  |  |  | 2014 |
Dirft Dist Ctr |  |  | 2 |  |  |  |  |  | 85,368 |  |  |  | - |  |  |  | 60,515 |  |  |  | 85,368 |  |  |  | 60,515 |  |  |  | 145,883 |  |  |  |  |  |  |  |  |
Grange Park |  |  | 1 |  |  |  |  |  | 16,797 |  |  |  | - |  |  |  | 14,451 |  |  |  | 16,797 |  |  |  | 14,451 |  |  |  | 31,248 |  |  |  |  |  |  |  |  |
Heathrow Phase 3 Distribution Center |  |  | 2 |  |  |  |  |  | 14,174 |  |  |  | - |  |  |  | 11,409 |  |  |  | 14,174 |  |  |  | 11,409 |  |  |  | 25,583 |  |  |  |  |  |  |  | 2014 |
Littlebrook Dist Ctr |  |  | 1 |  |  |  |  |  | 12,360 |  |  |  | - |  |  |  | 14,817 |  |  |  | 12,360 |  |  |  | 14,817 |  |  |  | 27,177 |  |  |  |  |  |  |  |  |
Midpoint Park |  |  | 2 |  |  |  |  |  | - |  |  |  | - |  |  |  | 12,275 |  |  |  | - |  |  |  | 12,275 |  |  |  | 12,275 |  |  |  |  |  |  |  |  |
United Kingdom |  |  | 9 |  |  |  |  |  | 144,905 |  |  |  | - |  |  |  | 128,317 |  |  |  | 144,905 |  |  |  | 128,317 |  |  |  | 273,222 |  |  |  |  |  |  |  |  |
Subtotal European Markets: |  |  | 24 |  |  |  |  |  | 197,461 |  |  |  | - |  |  |  | 218,390 |  |  |  | 197,461 |  |  |  | 218,390 |  |  |  | 415,851 |  |  |  |  |  |  |  |  |
Asian Markets |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Japan |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Chiba New Town Distribution Center |  |  | 1 |  |  |  |  |  | 31,079 |  |  |  | - |  |  |  | 1,166 |  |  |  | 31,079 |  |  |  | 1,166 |  |  |  | 32,245 |  |  |  |  |  |  |  |  |
Hisayama Dist Ctr |  |  | 1 |  |  |  |  |  | 5,120 |  |  |  | - |  |  |  | 18,739 |  |  |  | 5,120 |  |  |  | 18,739 |  |  |  | 23,859 |  |  |  |  |  |  |  |  |
Joso Dist Ctr |  |  | 1 |  |  |  |  |  | 12,140 |  |  |  | - |  |  |  | 26,160 |  |  |  | 12,140 |  |  |  | 26,160 |  |  |  | 38,300 |  |  |  |  |  |  |  | 2014 |
Kitamoto Distribution Center |  |  | 1 |  |  |  |  |  | 18,460 |  |  |  | - |  |  |  | 55,668 |  |  |  | 18,460 |  |  |  | 55,668 |  |  |  | 74,128 |  |  |  |  |  |  |  | 2014 |
Narashino IV Distribution Center |  |  | 1 |  |  |  |  |  | - |  |  |  | - |  |  |  | 19,239 |  |  |  | - |  |  |  | 19,239 |  |  |  | 19,239 |  |  |  |  |  |  |  |  |
Narita 1 |  |  | 1 |  |  |  |  |  | 9,361 |  |  |  | - |  |  |  | 20,368 |  |  |  | 9,361 |  |  |  | 20,368 |  |  |  | 29,729 |  |  |  |  |  |  |  |  |
Osaka 5 |  |  | 1 |  |  |  |  |  | 35,475 |  |  |  | - |  |  |  | 70,429 |  |  |  | 35,475 |  |  |  | 70,429 |  |  |  | 105,904 |  |  |  |  |  |  |  |  |
ProLogis Parc Tomiya III |  |  | 1 |  |  |  |  |  | 8,609 |  |  |  | - |  |  |  | 22,868 |  |  |  | 8,609 |  |  |  | 22,868 |  |  |  | 31,477 |  |  |  |  |  |  |  |  |
ProLogis Park Sendai |  |  | 1 |  |  |  |  |  | 4,913 |  |  |  | - |  |  |  | 3,437 |  |  |  | 4,913 |  |  |  | 3,437 |  |  |  | 8,350 |  |  |  |  |  |  |  |  |
Yoshimi Distribution Center |  |  | 1 |  |  |  |  |  | 21,258 |  |  |  | - |  |  |  | 18,442 |  |  |  | 21,258 |  |  |  | 18,442 |  |  |  | 39,700 |  |  |  |  |  |  |  |  |
Japan |  |  | 10 |  |  |  |  |  | 146,415 |  |  |  | - |  |  |  | 256,516 |  |  |  | 146,415 |  |  |  | 256,516 |  |  |  | 402,931 |  |  |  |  |  |  |  |  |
Subtotal Asian Markets: |  |  | 10 |  |  |  |  |  | 146,415 |  |  |  | - |  |  |  | 256,516 |  |  |  | 146,415 |  |  |  | 256,516 |  |  |  | 402,931 |  |  |  |  |  |  |  |  |
Total Development Portfolio |  |  | 79 |  |  |  |  |  | 592,397 |  |  |  | - |  |  |  | 881,583 |  |  |  | 592,397 |  |  |  | 881,583 |  |  |  | 1,473,980 |  |  |  |  |  |  |  |  |
GRAND TOTAL |  |  | 1,686 |  |  |  |  |  | 4,707,415 |  |  |  | 11,903,743 |  |  |  | 3,498,274 |  |  |  | 4,820,034 |  |  |  | 15,289,398 |  |  |  | 20,109,432 |  |  |  | (2,748,835 | ) |  |  |  |

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Schedule III – Footnotes

(a) | Reconciliation of real estate assets per Schedule III to the Consolidated Balance Sheet at December 31, 2014 (in thousands):

Total per Schedule III |  | $ | 20,109,432 |
Land |  |  | 1,577,786 |
Other real estate investments |  |  | 502,927 |
Total per consolidated balance sheet |  | $ | 22,190,145 | (f)

(b) | The aggregate cost for Federal tax purposes at December 31, 2014 of our real estate assets was approximately $14.0 billion (unaudited).

(c) | Real estate assets (excluding land balances) are depreciated over their estimated useful lives. These useful lives are generally five to seven years for capital improvements, 10 years for standard tenant improvements, 25 years for depreciable land improvements on developed buildings, 30 years for acquired industrial properties and 40 years for properties we develop.

Reconciliation of accumulated depreciation per Schedule III to the Consolidated Balance Sheets at December 31, 2014 (in thousands):

Total accumulated depreciation per Schedule III |  | $ | 2,748,835 |
Accumulated depreciation on other real estate investments |  |  | 41,946 |
Total per consolidated balance sheet |  | $ | 2,790,781 |

(d) | Properties with an aggregate undepreciated cost of $4.5 billion secure $2.3 billion of mortgage notes. See Note 9 to the Consolidated Financial Statements in Item 8 for more information related to our secured mortgage debt.

(e) | Assessment bonds of $15.5 million are secured by assessments (similar to property taxes) on various underlying real estate properties with an aggregate undepreciated cost of $783.4 million. See Note 9 to the Consolidated Financial Statements in Item 8 for more information related to our assessment bonds.

(f) | A summary of activity for our real estate assets and accumulated depreciation for the years ended December 31 (in thousands):

|  | 2014 |  |  | 2013 |  |  | 2012 |
Real estate assets: |  |  |  |  |  |  |  |  |  |  |  |
Balance at beginning of year |  | $ | 18,822,081 |  |  | $ | 23,559,891 |  |  | $ | 22,413,079 |
Acquisitions of operating properties, improvements to operating properties, development activity, transfers of land to CIP and net effect of changes in foreign exchange rates and other |  |  | 3,595,836 |  |  |  | 2,050,810 |  |  |  | 2,881,005 |
Basis of operating properties disposed of |  |  | (2,713,300) |  |  |  | (6,857,994) |  |  |  | (1,630,764) |
Change in the development portfolio balance, including the acquisition of properties |  |  | 452,963 |  |  |  | 69,374 |  |  |  | 91,112 |
Impairment of real estate properties (1) |  |  | - |  |  |  | - |  |  |  | (194,541) |
Assets transferred to held-for-sale |  |  | (48,148) |  |  |  | - |  |  |  | - |
Balance at end of year |  | $ | 20,109,432 |  |  | $ | 18,822,081 |  |  | $ | 23,559,891 |
Accumulated Depreciation: |  |  |  |  |  |  |  |  |  |  |  |
Balance at beginning of year |  | $ | 2,540,267 |  |  | $ | 2,460,642 |  |  | $ | 2,150,713 |
Depreciation expense |  |  | 490,298 |  |  |  | 505,691 |  |  |  | 665,239 |
Balances retired upon disposition of operating properties and net effect of changes in foreign exchange rates and other |  |  | (277,516) |  |  |  | (426,066) |  |  |  | (355,310) |
Assets transferred to held-for-sale |  |  | (4,214) |  |  |  | - |  |  |  | - |
Balance at end of year |  | $ | 2,748,835 |  |  | $ | 2,540,267 |  |  | $ | 2,460,642 |

(1) | The impairment charges we recognized in 2012 were primarily due to our change of intent to no longer hold these assets for long-term investment. See Note 15 to the Consolidated Financial Statements in Item 8 for more information related to our impairment charges.

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SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

PROLOGIS, INC.
By: |  | /s/ HAMID R. MOGHADAM
|  | Hamid R. Moghadam
|  | Chief Executive Officer

Date: February 25, 2015

POWER OF ATTORNEY

KNOW ALL MEN BY THESE PRESENTS, that we, the undersigned officers and directors of Prologis, Inc., hereby severally constitute Hamid R. Moghadam, Thomas S. Olinger and Edward S. Nekritz, and each of them singly, our true and lawful attorneys with full power to them, and each of them singly, to sign for us and in our names in the capacities indicated below, the Form 10-K filed herewith and any and all amendments to said Form 10-K, and generally to do all such things in our names and in our capacities as officers and directors to enable Prologis, Inc. to comply with the provisions of the Securities Exchange Act of 1934, and all requirements of the U.S. Securities and Exchange Commission, hereby ratifying and confirming our signatures as they may be signed by our said attorneys, or any of them, to said Form 10-K and any and all amendments thereto.

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

Signature |  | Title |  | Date
/s/ HAMID R. MOGHADAM Hamid R. Moghadam |  | Chairman of the Board and Chief Executive Officer |  | February 25, 2015
/s/ THOMAS S. OLINGER Thomas S. Olinger |  | Chief Financial Officer |  | February 25, 2015
/s/ LORI A. PALAZZOLO Lori A. Palazzolo |  | Managing Director and Chief Accounting Officer |  | February 25, 2015
/s/ GEORGE L. FOTIADES George L. Fotiades |  | Director |  | February 25, 2015
/s/ CHRISTINE N. GARVEY Christine N. Garvey |  | Director |  | February 25, 2015
/s/ LYDIA H. KENNARD Lydia H. Kennard |  | Director |  | February 25, 2015
/s/ J. MICHAEL LOSH J. Michael Losh |  | Director |  | February 25, 2015
/s/ IRVING F. LYONS III Irving F. Lyons III |  | Director |  | February 25, 2015
/s/ DAVID P. O’CONNOR David P. O’Connor |  | Director |  | February 25, 2015
/s/ JEFFREY L. SKELTON Jeffrey L. Skelton |  | Director |  | February 25, 2015
/s/ D. MICHAEL STEUERT D. Michael Steuert |  | Director |  | February 25, 2015
/s/ CARL B. WEBB Carl B. Webb |  | Director |  | February 25, 2015
/s/ WILLIAM D. ZOLLARS William D. Zollars |  | Director |  | February 25, 2015

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SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

PROLOGIS, L.P.
By: |  | Prologis, Inc., its general partner
By: |  | /s/ HAMID R. MOGHADAM
|  | Hamid R. Moghadam
|  | Chief Executive Officer

Date: February 25, 2015

POWER OF ATTORNEY

KNOW ALL MEN BY THESE PRESENTS, that we, the undersigned officers and directors of Prologis, L.P., hereby severally constitute Hamid R. Moghadam, Thomas S. Olinger and Edward S. Nekritz, and each of them singly, our true and lawful attorneys with full power to them, and each of them singly, to sign for us and in our names in the capacities indicated below, the Form 10-K filed herewith and any and all amendments to said Form 10-K, and generally to do all such things in our names and in our capacities as officers and directors to enable Prologis, L.P. to comply with the provisions of the Securities Exchange Act of 1934, and all requirements of the U.S. Securities and Exchange Commission, hereby ratifying and confirming our signatures as they may be signed by our said attorneys, or any of them, to said Form 10-K and any and all amendments thereto.

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

Signature |  | Title |  | Date
/s/ HAMID R. MOGHADAM Hamid R. Moghadam |  | Chairman of the Board and Chief Executive Officer |  | February 25, 2015
/s/ THOMAS S. OLINGER Thomas S. Olinger |  | Chief Financial Officer |  | February 25, 2015
/s/ LORI A. PALAZZOLO Lori A. Palazzolo |  | Managing Director and Chief Accounting Officer |  | February 25, 2015
/s/ GEORGE L. FOTIADES George L. Fotiades |  | Director |  | February 25, 2015
/s/ CHRISTINE N. GARVEY Christine N. Garvey |  | Director |  | February 25, 2015
/s/ LYDIA H. KENNARD Lydia H. Kennard |  | Director |  | February 25, 2015
/s/ J. MICHAEL LOSH J. Michael Losh |  | Director |  | February 25, 2015
/s/ IRVING F. LYONS III Irving F. Lyons III |  | Director |  | February 25, 2015
/s/ DAVID P. O’CONNOR David P. O’Connor |  | Director |  | February 25, 2015
/s/ JEFFREY L. SKELTON Jeffrey L. Skelton |  | Director |  | February 25, 2015
/s/ D. MICHAEL STEUERT D. Michael Steuert |  | Director |  | February 25, 2015
/s/ CARL B. WEBB Carl B. Webb |  | Director |  | February 25, 2015
/s/ WILLIAM D. ZOLLARS William D. Zollars |  | Director |  | February 25, 2015

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Certain of the following documents are filed herewith. Certain other of the following documents that have been previously filed with the Securities and Exchange Commission and, pursuant to Rule 12b-32, are incorporated herein by reference.

3.1 |  | Articles of Incorporation of Prologis (incorporated by reference to Exhibit 3.1 to Prologis’ Registration Statement on Form S-11 (No. 333-35915) filed September 18, 1997).
3.2 |  | Articles Supplementary establishing and fixing the rights and preferences of the 6 1/2% Series L Cumulative Redeemable Preferred Stock of Prologis (incorporated by reference to Exhibit 3.16 to Prologis’ Registration Statement on Form 8-A filed June 20, 2003).
3.3 |  | Articles Supplementary establishing and fixing the rights and preferences of the 6 3/4% Series M Cumulative Redeemable Preferred Stock of Prologis (incorporated by reference to Exhibit 3.17 to Prologis’ Registration Statement on Form 8-A filed November 12, 2003).
3.4 |  | Articles Supplementary establishing and fixing the rights and preferences of the 7.00% Series O Cumulative Redeemable Preferred Stock of Prologis (incorporated by reference to Exhibit 3.19 to Prologis’ Registration Statement on Form 8-A filed December 12, 2005).
3.5 |  | Articles Supplementary establishing and fixing the rights and preferences of the 6.85% Series P Cumulative Redeemable Preferred Stock of Prologis (incorporated by reference to Exhibit 3.18 to Prologis’ Registration Statement on Form 8-A filed August 24, 2006).
3.6 |  | Articles Supplementary establishing and fixing the rights and preferences of the Series Q Cumulative Redeemable Preferred Stock of Prologis (incorporated by reference to Exhibit 3.4 to Prologis’ Registration Statement on Form 8-A filed June 2, 2011).
3.7 |  | Articles Supplementary establishing and fixing the rights and preferences of the Series R Cumulative Redeemable Preferred Stock of Prologis (incorporated by reference to Exhibit 3.5 to Prologis’ Registration Statement on Form 8-A filed June 2, 2011).
3.8 |  | Articles Supplementary establishing and fixing the rights and preferences of the Series S Cumulative Redeemable Preferred Stock of Prologis (incorporated by reference to Exhibit 3.6 to Prologis’ Registration Statement on Form 8-A filed June 2, 2011).
3.9 |  | Articles of Merger of New Pumpkin Inc., a Maryland corporation, with and into Prologis, Inc., a Maryland corporation, changing the name of “AMB Property Corporation” to “Prologis, Inc.”, as filed with the Stated Department of Assessments and Taxation of Maryland on June 2, 2011, and effective June 3, 2011 (incorporated by reference to Exhibit 3.1 to Prologis’ Current Report on Form 8-K filed June 8, 2011).
3.10 |  | Articles of Amendment (incorporated by reference to Exhibit 3.1 to Prologis’ Current Report on Form 8-K filed May 8, 2012).
3.11 |  | Seventh Amended and Restated Bylaws of Prologis (incorporated by reference to Exhibit 3.2 to Prologis’ Current Report on Form 8-K filed June 8, 2011).
3.12 |  | Thirteenth Amended and Restated Agreement of Limited Partnership of the Operating Partnership (incorporated by reference to Exhibit 3.6 to Prologis’ Current Report on Form 8-K filed June 8, 2011).
3.13 |  | Amended and Restated Certificate of Limited Partnership of the Operating Partnership (incorporated by reference to Exhibit 3.7 to Prologis’ Current Report on Form 8-K filed June 8, 2011).
3.14 |  | First Amendment to Thirteenth Amended and Restated Agreement of Limited Partnership of Prologis, L.P., dated February 27, 2014, (incorporated by reference to Exhibit 3.1 to Prologis’ Current Report on Form 8-K filed on February 27, 2014).
3.15 |  | Articles Supplementary dated April 3, 2014, (incorporated by reference to Exhibit 3.1 to Prologis’ Current Report on Form 8-K filed on April 3, 2014).
3.16 |  | Articles Supplementary redesignating and reclassifying all 300,000 shares of 6.5% Series L Cumulative Redeemable Preferred Stock as Preferred Stock (incorporated by reference to Exhibit 3.1 to Prologis’ Current Report Form 8-K filed on May 5, 2014).
4.1 |  | Form of Certificate for Common Stock of Prologis (incorporated by reference to Exhibit 4.1 to Prologis’ Registration Statement on Form S-4/A (No. 333-172741) filed April 12, 2011).
4.2 |  | Form of Certificate for the Series Q Cumulative Redeemable Preferred Stock of Prologis (incorporated by reference to Exhibit 4.2 to Prologis’ Registration Statement on Form S-4/A (No. 333-172741) filed April 28, 2011).
4.3 |  | Indenture, dated as of June 8, 2011, by and among the Operating Partnership, as issuer, Prologis, as guarantor, and U.S. Bank National Association, as trustee (incorporated by reference to Exhibit 4.2 to Prologis’ Registration Statement on Form S-3 (No. 333-177112) filed September 30, 2011).
4.4 |  | Fourth Supplemental Indenture, dated as of June 8, 2011, in respect of the Operating Partnership’s 3.25% Exchangeable Senior Notes due 2015, by and among the Operating Partnership, as issuer, Prologis, as guarantor, and U.S. Bank National Association, as trustee (incorporated by reference to Exhibit 4.6 to Prologis’ Registration Statement on Form S-3 (No. 333-177112) filed September 30, 2011).
4.5 |  | Fifth Supplemental Indenture, dated as of August 15, 2013, among Prologis, Inc., Prologis, L.P. and U.S. Bank National Association (incorporated by reference to Exhibit 4.1 to Prologis’ Current Report on Form 8-K filed August 15, 2013).
4.6 |  | Form of Sixth Supplemental Indenture among Prologis, Inc., Prologis, L.P., Elavon Financial Services Limited, UK Branch, Elavon Financial Services Limited and U.S. Bank National Association (incorporated by reference to Exhibit 4.1 to Prologis’ Current Report on Form 8-K filed December 2, 2013).

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4.7 |  | Form of Seventh Supplemental Indenture among Prologis, Inc., Prologis, L.P., Elavon Financial Services Limited, UK Branch, Elavon Financial Services Limited and U.S. Bank National Association (incorporated by reference to Exhibit 4.1 to Prologis’ Current Report on Form 8-K filed February 18, 2014).
4.8 |  | Indenture, dated as of June 30, 1998, by and among the Operating Partnership, Prologis and State Street Bank and Trust Company of California, N.A., as trustee (incorporated by reference to Exhibit 4.1 to Prologis’ Current Report on Form 8-K filed August 10, 2006 and also incorporated by reference to Exhibit 4.1 to the Operating Partnership’s Current Report on Form 8-K filed August 10, 2006).
4.9 |  | First Supplemental Indenture, dated as of June 30, 1998, by and among the Operating Partnership, Prologis and State Street Bank and Trust Company of California, N.A., as trustee (incorporated by reference to Exhibit 4.2 to Prologis’ Registration Statement on Form S-11 (No. 333-49163) filed April 2, 1998).
4.10 |  | Second Supplemental Indenture, dated as of June 30, 1998, by and among the Operating Partnership, Prologis and State Street Bank and Trust Company of California, N.A., as trustee (incorporated by reference to Exhibit 4.3 to Prologis’ Registration Statement on Form S-11 (No. 333-49163) filed April 2, 1998).
4.11 |  | Third Supplemental Indenture, dated as of June 30, 1998, by and among the Operating Partnership, Prologis and State Street Bank and Trust Company of California, N.A., as trustee (incorporated by reference to Exhibit 4.4 to Prologis’ Registration Statement on Form S-11 (No. 333-49163) filed April 2, 1998).
4.12 |  | Seventh Supplemental Indenture, dated as of August 10, 2006, by and among the Operating Partnership, Prologis and U.S. Bank National Association, as successor-in-interest to State Street Bank and Trust Company of California, N.A., as trustee (incorporated by reference to Exhibit 4.2 to Prologis’ Current Report on Form 8-K filed August 10, 2006 and also incorporated by reference to Exhibit 4.2 to the Operating Partnership’s Current Report on Form 8-K filed August 10, 2006).
4.13 |  | Eighth Supplemental Indenture, dated as of November 20, 2009, by and among the Operating Partnership, Prologis and U.S. Bank National Association, as successor-in-interest to State Street Bank and Trust Company of California, N.A., as trustee (incorporated by reference to Exhibit 4.1 to Prologis’ Current Report on Form 8-K filed November 20, 2009).
4.14 |  | Ninth Supplemental Indenture, dated as of November 20, 2009, by and among the Operating Partnership, Prologis and U.S. Bank National Association, as successor-in-interest to State Street Bank and Trust Company of California, N.A., as trustee (incorporated by reference to Exhibit 4.2 to Prologis’ Current Report on Form 8-K filed November 20, 2009).
4.15 |  | Tenth Supplemental Indenture, dated as of August 9, 2010, by and among the Operating Partnership, Prologis and U.S. Bank National Association, as successor-in-interest to State Street Bank and Trust Company of California, N.A., as trustee (incorporated by reference to Exhibit 4.1 to Prologis’ Current Report on Form 8-K filed August 9, 2010).
4.16 |  | Eleventh Supplemental Indenture, dated as of November 12, 2010, by and among the Operating Partnership, Prologis and U.S. Bank National Association, as successor-in-interest to State Street Bank and Trust Company of California, N.A., as trustee (incorporated by reference to Exhibit 4.1 to Prologis’ Current Report on Form 8-K filed November 10, 2010).
4.17 |  | Specimen of 7.50% Notes due 2018 (incorporated by reference to and included in Exhibit 4.3 to Prologis’ Registration Statement on Form S-11 (No. 333-49163) filed April 2, 1998).
4.18 |  | 6.625% Notes due 2019 and Related Guarantee (incorporated by reference to Exhibit 4.4 to Prologis’ Current Report on Form 8-K filed November 20, 2009).
4.19 |  | 4.500% Notes due 2017 and Related Guarantee (incorporated by reference to Exhibit 4.2 to Prologis’ Current Report on Form 8-K filed August 9, 2010).
4.20 |  | 4.00% Notes due 2018 and Related Guarantee (incorporated by reference to Exhibit 4.2 to Prologis’ Current Report on Form 8-K filed November 10, 2010).
4.21 |  | Form of Global Note Representing the Operating Partnership’s 7.625% Notes due July 1, 2017 and Related Guarantee (incorporated by reference to Exhibit 4.51 to Prologis’ Registration Statement on Form S-4 (No. 333-173891) filed May 3, 2011).
4.22 |  | Form of Global Note Representing the Operating Partnership’s 7.375% Notes due October 30, 2019 and Related Guarantee (incorporated by reference to Exhibit 4.53 to Prologis’ Registration Statement on Form S-4 (No. 333-173891) filed May 3, 2011).
4.23 |  | Form of Global Note Representing the Operating Partnership’s 6.875% Notes due March 15, 2020 and Related Guarantee (incorporated by reference to Exhibit 4.54 to Prologis’ Current Report on Form 8-K filed May 3, 2011).
4.24 |  | Form of Global Note Representing the Operating Partnership’s 3.250% Exchangeable Senior Notes due 2015 and Related Guarantee (incorporated by reference to and included in Exhibit 4.6 to Prologis’ Registration Statement on Form S-3 (No. 333-177112) filed September 30, 2011).
4.25 |  | Form of 2.750% Notes due 2019 (incorporated by reference to Exhibit 4.4 to Prologis’ Current Report on Form 8-K filed August 15, 2013).
4.26 |  | Form of 4.250% Notes due 2023 (incorporated by reference to Exhibit 4.5 to Prologis’ Current Report on Form 8-K filed August 15, 2013).
4.27 |  | 3.350% Notes due 2021 (incorporated by reference to Exhibit 4.2 to Prologis’ Current Report on Form 8-K filed November 1, 2013).
4.28 |  | Form of 3.000% Notes due 2022 (incorporated by reference to Exhibit 4.2 to Prologis’ Current Report on Form 8-K filed December 2, 2013).

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4.29 |  | Form of 3.375% Notes due 2024 (incorporated by reference to Exhibit 4.3 to Prologis’ Current Report on Form 8-K filed February 18, 2014).
4.30 |  | Form of 3.00% Notes due 2026 (incorporated by reference to Exhibit 4.2 to Prologis’ Current Report on Form 8-K filed on May 28, 2014).
4.31 |  | Form of 1.375% Notes due 2020 (incorporated by reference to Exhibit 4.2 to Prologis’ Current Report on Form 8-K filed on October 6, 2014).
4.32 |  | Form of Officer’s Certificate related to the Operating Partnership’s 7.625% Notes due July 1, 2017 (incorporated by reference to Exhibit 4.69 to Prologis’ Registration Statement on Form S-4 (No. 333-173891) filed May 3, 2011).
4.33 |  | Form of Officer’s Certificate related to the Operating Partnership’s 7.375% Notes due October 30, 2019 (incorporated by reference to Exhibit 4.71 to Prologis’ Registration Statement on Form S-4 (No. 333-173891) filed May 3, 2011).
4.34 |  | Form of Officer’s Certificate related to the Operating Partnership’s 6.875% Notes due March 15, 2020 (incorporated by reference to Exhibit 4.72 to Prologis’ Registration Statement on Form S-4 (No. 333-173891) filed May 3, 2011).
4.35 |  | Officers’ Certificate related to the 2.750% Notes due 2019 (incorporated by reference to Exhibit 4.2 to Prologis’ Current Report on Form 8-K filed August 15, 2013).
4.36 |  | Officers’ Certificate related to the 4.250% Notes due 2023 (incorporated by reference to Exhibit 4.3 to Prologis’ Current Report on Form 8-K filed August 15, 2013).
4.37 |  | Officers’ Certificate related to the 3.350% Notes due 2021 (incorporated by reference to Exhibit 4.1 to Prologis’ Current Report on Form 8-K filed November 1, 2013).
4.38 |  | Form of Officers’ Certificate related to the 3.375% Notes due 2024 (incorporated by reference to Exhibit 4.2 to Prologis’ Current Report on Form 8-K filed February 18, 2014).
4.39 |  | Form of Officer’s Certificate related to the 3.00% Notes due 2026 (incorporated by reference to Exhibit 4.1 to Prologis’ Current Report on Form 8-K filed on May 28, 2014).
4.40 |  | Form of Officer’s Certificate related to 1.375% Notes due 2020 (incorporated by reference to Exhibit 4.1 to Prologis’ Current Report on Form 8-k filed on October 6, 2014).

Other debt instruments are omitted in accordance with Item 601(b)(4)(iii)(A) of Registration S-K. Copies of such instruments will be furnished to the Securities and Exchange Commission upon request.

10.1 |  | Agreement of Limited Partnership of ProLogis Limited Partnership-I, dated as of December 22, 1993 (incorporated by reference to Exhibit 10.4 to the Trust’s Registration Statement (No. 33-73382)) .
10.2 |  | Amended and Restated Agreement of Limited Partnership of ProLogis Fraser, L.P., dated as of August 4, 2004 (incorporated by reference to Exhibit 10.1 to the Trust’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2004).
10.3 |  | Fifteenth Amended and Restated Agreement of Limited Partnership of Prologis 2, L.P., (f/k/a AMB Property II, L.P.) dated February 19, 2010 (incorporated by reference to Exhibit 10.6 to Prologis’ Annual Report on Form 10-K for the year ended December 31, 2009).
10.4 |  | Exchange Agreement, dated as of July 8, 2005, by and between the Operating Partnership and Teachers Insurance and Annuity Association of America (incorporated by reference to Exhibit 10.1 to Prologis’ Current Report on Form 8-K filed July 13, 2005 and also incorporated by reference to Exhibit 10.1 to the Operating Partnership’s Current Report on Form 8-K filed July 13, 2005).
10.5 |  | Transfer and Registration Rights Agreement, dated as of December 22, 1993, by and among the Trust and the persons set forth therein (incorporated by reference to Exhibit 10.10 to the Trust’s Registration Statement (No. 33-73382)).
10.6 |  | Registration Rights Agreement dated February 9, 2007, between the Trust and each of the parties identified therein (incorporated by reference to Exhibit 99.10 to the Trust’s Annual Report on Form 10-K for the year ended December 31, 2006).
10.7 |  | Form of Registration Rights Agreement, by and among Prologis and the persons named therein (incorporated by reference to Exhibit 10.2 to Prologis’ Registration Statement on Form S-11 (No. 333-35915) filed September 18, 1997).
10.8 |  | Registration Rights Agreement, dated as of November 10, 2009, by and between Prologis and J.P. Morgan Securities Inc. (incorporated by reference to Exhibit 4.1 to Prologis’ Current Report on Form 8-K filed November 10, 2009).
10.9 |  | Registration Rights Agreement, dated November 26, 1997, by and among Prologis and the persons named therein (incorporated by reference to Exhibit 4.1 to Prologis’ Quarterly Report on Form 10-Q for the quarter ended June 30, 2010).
10.10 |  | Registration Rights Agreement, dated as of July 8, 2005, by and between the Operating Partnership and Teachers Insurance and Annuity Association of America (incorporated by reference to Exhibit 4.3 to the Operating Partnership’s Current Report on Form 8-K filed July 13, 2005).
10.11 |  | Registration Rights Agreement, dated November 14, 2003, by and among Prologis 2, L.P.(formerly known as AMB Property II, L.P.) and the unitholders whose names are set forth on the signature pages thereto (incorporated by reference to Exhibit 4.1 to Prologis’ Current Report on Form 8-K filed November 17, 2003).
10.12 |  | Registration Rights Agreement, dated as of May 5, 1999, by and among Prologis, Prologis 2, L.P. and the unitholders whose names are set forth on the signature pages thereto (incorporated by reference to Exhibit 4.33 to Prologis’ Annual Report on Form 10-K for the year ended December 31, 2006).

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10.13 |  | Registration Rights Agreement, dated as of November 1, 2006, by and among Prologis, Prologis 2, L.P., J.A. Green Development Corp. and JAGI, Inc (incorporated by reference to Exhibit 4.34 to Prologis’ Annual Report on Form 10-K for the year ended December 31, 2006).
10.14 |  | Registration Rights Agreement, dated as of June 30, 2013, by and among Prologis, Inc., Prologis 2, L.P. and Bakar AMB Limited Partnership (incorporated by reference to Exhibit 10.14 to Prologis’ Annual Report on Form 10-K for the year ended December 31, 2013).
10.15 |  | Equity Distribution Agreement, dated as of February 5, 2015, among Prologis, Inc. and Merrill Lynch, Pierce, Fenner & Smith Incorporated, Citigroup Global Markets Inc., Goldman, Sachs & Co., J.P. Morgan Securities LLC, Morgan Stanley & Co. LLC and Wells Fargo Securities, LLC. (incorporated by reference to Exhibit 1.1 to Prologis’ Current Report on Form 8-K filed February 5, 2015).
10.16* |  | The Third Amended and Restated 1997 Stock Option and Incentive Plan of AMB Property Corporation and AMB Property, L.P. (incorporated by reference to Exhibit 10.22 to Prologis’ Annual Report on Form 10-K for the year ended December 31, 2001 and also incorporated by reference to Exhibit 10.19 to the Operating Partnership’s Annual Report on Form 10-K for the year ended December 31, 2001).
10.17* |  | Amendment No. 1 to the Third Amended and Restated 1997 Stock Option and Incentive Plan of AMB Property Corporation and AMB Property, L.P. (incorporated by reference to Exhibit 10.23 to Prologis’ Annual Report on Form 10-K for the year ended December 31, 2001 and also incorporated by reference to Exhibit 10.20 to the Operating Partnership’s Annual Report on Form 10-K for the year ended December 31, 2001).
10.18* |  | Amendment No. 2 to the Third Amended and Restated 1997 Stock Option and Incentive Plan of AMB Property Corporation and AMB Property, L.P. (incorporated by reference to Exhibit 10.5 to Prologis’ Quarterly Report on Form 10-Q for the quarter ended March 31, 2004 and also incorporated by reference to Exhibit 10.4 to the Operating Partnership’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2004).
10.19* |  | Amended and Restated 2002 Nonqualified Deferred Compensation Plan (incorporated by reference to Exhibit 10.2 to Prologis’ Current Report on Form 8-K filed October 4, 2006 and also incorporated by reference to Exhibit 10.2 to the Operating Partnership’s Current Report on Form 8-K filed October 4, 2006).
10.20* |  | The Amended and Restated 2002 Stock Option and Incentive Plan of AMB Property Corporation and AMB Property, L.P. (incorporated by reference to Exhibit 10.1 to Prologis’ Current Report on Form 8-K filed May 15, 2007 and also incorporated by reference to Exhibit 10.1 to the Operating Partnership’s Current Report on Form 8-K filed May 15, 2007).
10.21* |  | Prologis Outperformance Plan (incorporated by reference to Exhibit 10.1 to Prologis’ Current Report on Form 8-K filed December 22, 2011).
10.22* |  | Form of Participation Points and LTIP Unit Award Agreement (incorporated by reference to Exhibit 10.1 to Prologis’ Current Report on Form 8-K filed on February 27, 2014).
10.23* |  | Second Amended and Restated Prologis Promote Plan (incorporated by reference to Exhibit 10.1 to Prologis’ Current Report on Form 8-K filed on August 1, 2014).
10.24* |  | Form of Prologis, Inc. Second Amended and Restated Prologis Promote Plan LTIP Unit Award Agreement (incorporated by reference to Exhibit 10.1 to Prologis’ Current Report on Form 8-K filed on August 18, 2014).
10.25* |  | Form of Prologis, Inc. Long-term Incentive Plan LTIP Unit Award Agreement (General) (incorporated by reference to Exhibit 10.3 to Prologis’ Quarterly Report on Form 10-Q for the quarter ended September 30, 2014).
10.26* |  | Form of Prologis, Inc. 2012 Long-term Incentive Plan Restricted Stock Unit Agreement (LTIP Unit election) (incorporated by reference to Exhibit 10.4 to Prologis’ Quarterly Report on Form 10-Q for the quarter ended September 30, 2014).
10.27* |  | Form of Prologis, Inc. 2012 Long-term Incentive Plan Restricted Stock Unit Agreement (incorporated by reference to Exhibit 10.5 to Prologis’ Quarterly Report on Form 10-Q for the quarter ended September 30, 2014) .
10.28* |  | Form of Prologis, Inc. 2012 Long-term Incentive Plan Restricted Stock Unit Agreement (Bonus exchange) (incorporated by reference to Exhibit 10.6 to Prologis’ Quarterly Report on Form 10-Q for the quarter ended September 30, 2014).
10.29* |  | ProLogis 2006 Long-Term Incentive Plan (incorporated by reference to Exhibit 10.2 to the Trust’s Current Report on Form 8-K filed June 2, 2006).
10.30* |  | First Amendment of the ProLogis 2006 Long-Term Incentive Plan (incorporated by reference to Exhibit 10.1 to the Trust’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2010).
10.31* |  | Second Amendment of the ProLogis 2006 Long-Term Incentive Plan (incorporated by reference to Exhibit 10.1 to the Trust’s Current Report on Form 8-K filed May 19, 2010).
10.32* |  | Third Amendment of the ProLogis 2006 Long-Term Incentive Plan (incorporated by reference to Exhibit 10.1 to the Trust’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2010).
10.33* |  | Form of Non Qualified Share Option Award Terms; The Trust 2006 Long-Term Incentive Plan (incorporated by reference to Exhibit 10.25 to the Trust’s Annual Report on Form 10-K for the year ended December 31, 2009).
10.34* |  | Form of Restricted Share Award Terms; ProLogis 2006 Long-Term Incentive Plan (incorporated by reference to Exhibit 10.26 to the Trust’s Annual Report on Form 10-K for the year ended December 31, 2009).
10.35* |  | Form of Performance Share Award Terms; ProLogis 2006 Long-Term Incentive Plan (incorporated by reference to Exhibit 10.27 to the Trust’s Annual Report on Form 10-K for the year ended December 31, 2009).

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10.36* |  | ProLogis 2000 Share Option Plan for Outside Trustees (as Amended and Restated Effective as of December 31, 2009) (incorporated by reference to exhibit 10.13 to ProLogis’ Form 10-K for the year ended December 31, 2008).
10.37* |  | ProLogis Trust 1997 Long-Term Incentive Plan (as Amended and Restated Effective as of September 26, 2002) (incorporated by reference to exhibit 10.1 to ProLogis’ Form 8-K dated February 19, 2003).
10.38* |  | First Amendment of ProLogis 1997 Long-Term Incentive Plan (incorporated by reference to exhibit 10.2 to ProLogis’ Form 8-K filed on May 19, 2010).
10.39* |  | ProLogis Deferred Fee Plan for Trustees (As Amended and Restated Effective as of May 14, 2010) (incorporated by reference to exhibit 10.3 to ProLogis’ Form 8-K filed on May 19, 2010).
10.40* |  | Form of Indemnification Agreement between ProLogis and certain directors and executive officers (incorporated by reference to Exhibit 10.1 to Prologis’ Current Report on Form 8-K filed June 8, 2011).
10.41* |  | Form of Restricted Stock Unit Agreement; Prologis, Inc. 2012 Long-Term Incentive Plan (incorporated by reference to Exhibit 10.1 to Prologis’ Quarterly Report on Form 10-Q for the quarter ended September 30, 2012).
10.42* |  | Employment Agreement made and entered into on January 30, 2011 and effective at January 1, 2012, by and between Walter C. Rakowich and ProLogis (incorporated by reference to Exhibit 10.25 to the Trust’s Annual Report on Form 10-K for the year ended December 31, 2010).
10.43* |  | Prologis, Inc. 2012 Long-Term Incentive Plan (incorporated by reference to Exhibit 10.1 to Prologis’ Current Report on Form 8-K filed May 8, 2012).
10.44* |  | Form of Director Deferred Stock Unit Award terms (incorporated by reference to Exhibit 10.2 to Prologis’ Current Report on Form 8-K filed May 8, 2012).
10.45* |  | First Amendment to Employment Agreement effective as of December 6, 2012, by and between Walter C. Rakowich and Prologis (incorporated by reference to Exhibit 10.55 to Prologis’ Annual Report on Form 10-K for the year ended December 31, 2012).
10.46* |  | Form of Change of Control and Noncompetition Agreement by and between Prologis, Inc. and its executive officers (incorporated by reference to Exhibit 10.2 to Prologis’ Current Report on Form 8-K filed August 16, 2013).
10.47* |  | Consulting Agreement, dated January 22, 2014, by and between Guy Jaquier and Prologis, L.P. (incorporated by reference to Exhibit 10.1 to Prologis’ Quarterly Report on Form 10-Q for the quarter ended March 31, 2014).
10.48 |  | Credit Agreement, dated as of November 29, 2010, by and among the Operating Partnership, as borrower, the banks listed on the signature pages thereof, HSBC Bank USA, National Association, as administrative agent, Credit Agricole Corporate and Investment Bank, as syndication agent, and HSBC Securities, Inc. and Credit Agricole Corporate and Investment Bank, as joint lead arrangers and joint bookrunners, and Morgan Stanley Senior Funding, Inc. as documentation agent (incorporated by reference to Exhibit 10.1 to Prologis’ Current Report on Form 8-K filed December 1, 2010).
10.49 |  | Guaranty of Payment, dated as of November 29, 2010, by Prologis for the benefit of HSBC Bank USA, National Association, as administrative agent for the banks that are from time to time parties to the Credit Agreement, dated as of November 29, 2010 (incorporated by reference to Exhibit 10.2 to Prologis’ Current Report on Form 8-K filed December 1, 2010).
10.50 |  | Qualified Borrower Guaranty, dated as of November 29, 2010, by the Operating Partnership for the benefit of HSBC Bank USA, National Association, as administrative agent for the banks that are from time to time parties to the Credit Agreement, dated as of November 29, 2010 (incorporated by reference to Exhibit 10.3 to Prologis’ Current Report on Form 8-K filed December 1, 2010).
10.51 |  | First Amendment and Waiver, dated as of June 3, 2011, by and among Operating Partnership, as borrower, Prologis, as guarantor, various banks and HSBC Bank USA, National Association, as administrative agent, to the Credit Agreement, dated as of November 29, 2010, (incorporated by reference to Exhibit 10.4 to Prologis’ Current Report on Form 8-K filed June 9, 2011).
10.52 |  | Global Senior Credit Agreement dated as of July 11, 2013, among Prologis, Inc., Prologis, L.P., various affiliates of Prologis, L.P., various lenders and agents, and Bank of America, N.A., as Administrative Agent (incorporated by reference to Exhibit 10.1 to Prologis’ Current Report on Form 8-K filed July 15, 2013).
10.53 |  | Fourth Amended and Restated Revolving Credit Agreement dated as of August 14, 2013 among Prologis Japan Finance Y.K., as initial borrower, Prologis, Inc. and Prologis, L.P., as guarantors, the banks listed on the signature pages thereof, and Sumitomo Mitsui Banking Corporation, as Administrative Agent (incorporated by reference to Exhibit 10.1 to Prologis’ Current Report on Form 8-K filed August 16, 2013).
10.54 |  | Guaranty of Payment, dated as of August 14, 2013, among Prologis, Inc. and Prologis, L.P., as guarantors, Sumitomo Mitsui Banking Corporation, as Administrative Agent, for the banks that are from time to time parties to the Fourth Amended and Restated Revolving Credit Agreement, dated as of August 14, 2013 (incorporated by reference to Exhibit 10.2 to Prologis’ Current Report on Form 8-K filed August 16, 2013).
10.55 |  | Senior Term Loan Agreement dated as of June 19, 2014 among Prologis, Inc., Prologis, L.P., various affiliates of Prologis, L.P., various lenders and Bank of America, N.A. as administrative agent (incorporated by reference to Exhibit 10.1 to Prologis’ Current Report Form 8-K filed on June 24, 2014).
10.56 |  | First Amendment to the Global Senior Credit Agreement dated as of June 26, 2014 among Prologis, Inc., Prologis, L.P., various affiliates of Prologis, L.P., various lenders and Bank of America, N.A. as administrative agent (incorporated by reference to Exhibit 10.1 to Prologis’ Current Report Form 8-K filed on June 30, 2014).

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10.57†* |  | Form of Prologis, Inc. Long-term Incentive Plan LTIP Unit Award Agreement (General form 2015).
10.58†* |  | Form of Prologis, Inc. Outperformance Plan LTIP Unit Exchange Award Agreement.
10.59†* |  | Form of Prologis, Inc. Long-term Incentive Plan Equity Exchange Offer LTIP Unit Award Agreement.
10.60†* |  | Amended and Restated Prologis, Inc. 2011 Notional Account Deferred Compensation Plan.
10.61†* |  | Amended and Restated Prologis, Inc. Nonqualified Deferred Compensation Plan.
10.62†* |  | Second Amended and Restated Prologis 2005 Nonqualified Deferred Compensation Plan.
10.63†* |  | Time-Sharing Agreement, dated January 21, 2015, by and between ProLogis Logistics Services Incorporated and Hamid R. Moghadam.
12.1† |  | Computation of Ratio of Earnings to Fixed Charges of Prologis, Inc. and Prologis, L.P.
12.2† |  | Computation of Ratio of Earnings to Combined Fixed Charges and Preferred Stock/Unit Dividends of Prologis, Inc. and Prologis, L.P.
21.1† |  | Subsidiaries of Prologis, Inc. and Prologis, L.P.
23.1† |  | Consent of KPMG LLP with respect to Prologis, Inc.
23.2† |  | Consent of KPMG LLP with respect to Prologis, L.P.
24.1† |  | Power of Attorney for Prologis, Inc. (included in signature page of this annual report).
24.2† |  | Power of Attorney for Prologis, L.P. (included in signature page of this annual report).
31.1† |  | Certification of Chief Executive Officer of Prologis, Inc.
31.2† |  | Certification of Chief Financial Officer of Prologis, Inc.
31.3† |  | Certification of Chief Executive Officer for Prologis, L.P.
31.4† |  | Certification of Chief Financial Officer for Prologis, L.P.
32.1† |  | Certification of Chief Executive Officer and Chief Financial Officer of Prologis, Inc., pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2† |  | Certification of Chief Executive Officer and Chief Financial Officer for Prologis, L.P., pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101. INS† |  | XBRL Instance Document
101. SCH† |  | XBRL Taxonomy Extension Schema
101. CAL† |  | XBRL Taxonomy Extension Calculation Linkbase
101. DEF† |  | XBRL Taxonomy Extension Definition Linkbase
101. LAB† |  | XBRL Taxonomy Extension Label Linkbase
101. PRE† |  | XBRL Taxonomy Extension Presentation Linkbase

| * | Management Contract or Compensatory Plan or Arrangement

| † | Filed herewith

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