Zacks_Analysts' Blog : Prologis Invests in Mexican Venture - Analyst Blog

Prologis, Inc. (PLD) recently announced that it has made a contribution of $293 million industrial portfolio to its Mexican co-investment venture, Prologis Mexico Fondo Logistico.

The contribution includes assets worth $234.5 million from its wholly-owned portfolio and $58.5 million of assets from its Prologis North American Industrial Fund II. The proceeds of $266 million generated from Prologis co-investment will be used to repay the company’s debt.

Prologis Mexico Fondo Logistico is the first industrial venture for Mexican pension plans. The primary objective of this venture is to develop, own and manage properties mainly within Prologis' markets in Mexico. The industrial real estate market in Mexico is very attractive given the country’s economic growth and rising consumer demand.

The company’s recent decision to invest in the Mexican venture is expected to strengthen its financial position by reducing debt and concurrently, enabling it to deploy capital to acquire high-quality assets in the global market.

Prologis (erstwhile AMB Property Corp.) is a leading industrial real estate investment trust (REIT) that acquires, develops, operates and manages industrial real estate space in North America, Asia and Europe.

The majority of the company’s portfolio comprise high throughput distribution (HTD), which provides multiple options for quick movement and the distribution of goods to the customer and serves as a critical element in creating efficiencies in the global supply chain.

Prologis currently retains a Zacks #3 Rank, which translates into a short-term Hold rating. We are also maintaining our long-term Neutral recommendation on the stock. One of its competitors, Mack- Cali Realty Corporation Co (CLI) also holds a Zacks #3 Rank.