TPG to Buy ProLogis Assets

Dec. 21, 2010 3:29 p.m. ET

Warehouse company ProLogis said it is selling a portfolio of retail and mixed-use assets to private-equity firm TPG for $505 million, the latest in a series of sales by ProLogis as the company seeks to pay down debt and get in position for future growth.
Publicly traded ProLogis bought the properties being sold as part of its $3.6 billion acquisition of Catellus Development Corp. in 2005. The portfolio includes four shopping centers, two office buildings, 11 mixed-use projects, and Los Angeles Union Station. ProLogis said the sales price isn't comparable to the Catellus acquisition price because other assets from the Catellus portfolio have been sold in recent years.
ProLogis, which went on a debt-fueled expansion binge during the boom years, faced a cash crunch in 2008. It has been repairing its balance sheet, selling stock and property. In October, it announced the sale of 180 industrial properties, a minority interest in a hotel, and stakes in three investment funds to private-equity firm Blackstone Group LP for $1.02 billion.
"The Catellus assets are high quality with good long-term prospects, but they are not in keeping with our strategy to concentrate our investment in core industrial properties in the world's major logistics corridors," ProLogis Chief Executive Walter C. Rakowich said in a statement.

—Anton Troianovski