) - a leading industrial real estate investment trust (REIT) -
closed a $1 billion joint venture (JV) in the U.S. with the
Norges Bank Investment Management (NBIM). The JV, named Prologis
U.S. Logistics Venture (USLV), represents Prologis' second
venture with NBIM following its European JV earlier last year.
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PROLOGIS INC (PLD): Free Stock Analysis
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The JV, structured as a 55/45 venture with Prologis owning 55%
and NBIM owning 45%, acquired a 12.8 million square foot
stabilized portfolio consisting of 66 logistics facilities. These
facilities were previously owned by Prologis.
These 66 properties are positioned in eight states in the U.S.
across nine markets including Southern California, Pennsylvania,
the San Francisco Bay Area, New Jersey, Las Vegas, Chicago,
Seattle, Atlanta, and Miami. The JV may further increase its
portfolio through strategic acquisitions in key markets to
complement its existing asset base.
Notably, NBIM is a unit of Norges Bank - the Central Bank of
Norway. It is in charge of the operational management of the
Norwegian Government Pension Fund Global and manages foreign
exchange reserves of Norges Bank.
This fund is the largest pension fund in Europe. Therefore, the
partnership of Prologis and NBIM brings in capital so that both
the companies can leverage on the growing demand for premium
logistic facilities in the U.S.
As a matter of fact, with a larger customer base, rise in
e-Commerce application and supply chain consolidation, the demand
for logistics infrastructure and efficient distribution networks
has grown in the U.S.
Prologis is scheduled to announce its fourth-quarter 2013 results
on Jan 30. The Zacks Consensus Estimate for fourth-quarter fund
from operations (FFO) is currently pegged at 42 cents per share,
representing a year-over-year increase of 1.1%.
The Earnings ESP for Prologis is +2.38 %. This is because the
Most Accurate estimate stands at 43 cents while the Zacks
Consensus Estimate is lower at 42 cents. In addition, Prologis'
Zacks Rank #3 (Hold) enhances the predictive power of ESP. This
combination of its Zacks Rank and Earnings ESP makes us confident
of an earnings surprise call in the to-be-reported quarter.
Investors interested in the REIT industry may also consider
Getty Realty Corp.
National Health Investors Inc.
Pebblebrook Hotel Trust
). All these stocks carry a Zacks Rank #1 (Strong Buy).
FFO, a widely used metric to gauge the performance of REITs,
are obtained after adding depreciation and amortization and other
non-cash expenses to net income.