UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

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

For the quarterly period ended September 30, 2008

o		TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from                      to                     

PROLOGIS

(Exact name of registrant as specified in its charter)

Maryland		74-2604728
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)
4545 Airport Way, Denver, Colorado		80239
(Address or principal executive offices)		(Zip Code)

     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 for the past 90 days.

Yes þ No o

     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 definitions of “large accelerated filer”, “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer þ		Accelerated filer o		Non-accelerated filer   o		Smaller reporting company o
			(Do not check if a 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).

Yes o No þ

The number of shares outstanding of the Registrant’s common shares as of November 3, 2008 was 265,658,322.

 

 

PROLOGIS

INDEX

				Page
				Number(s)
PART I.		Financial Information			3
		Item 1. Financial Statements:			3
		Consolidated Statements of Earnings and Comprehensive Income (Loss) — Three and Nine months ended September 30, 2008 and 2007			3
		Consolidated Balance Sheets — September 30, 2008 and December 31, 2007			5
		Consolidated Statements of Cash Flows — Nine months ended September 30, 2008 and 2007			6
		Notes to Consolidated Financial Statements			7
		Report of Independent Registered Public Accounting Firm			27
		Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations			28
		Item 3. Quantitative and Qualitative Disclosures About Market Risk			50
		Item 4. Controls and Procedures			51
PART II.		Other Information			51
		Item 1. Legal Proceedings			51
		Item 1A. Risk Factors			51
		Item 2. Unregistered Sales of Equity Securities and Use of Proceeds			52
		Item 3. Defaults Upon Senior Securities			52
		Item 4. Submission of Matters to a Vote of Security Holders			52
		Item 5. Other Information			52
		Item 6. Exhibits			53
EX-12.1
EX-12.2
EX-15.1
EX-31.1
EX-31.2
EX-32.1
INSTANCE DOCUMENT
SCHEMA DOCUMENT
CALCULATION LINKBASE DOCUMENT
LABELS LINKBASE DOCUMENT
PRESENTATION LINKBASE DOCUMENT
DEFINITION LINKBASE DOCUMENT

PART 1.

Item 1. Financial Statements

PROLOGIS

CONSOLIDATED STATEMENTS OF

		Three months ended								Nine months ended
		September 30,								September 30,
		2008				2007				2008				2007
Revenues:
Rental income		$	253,499			$	280,514			$	784,223			$	807,677
CDFS disposition proceeds:
Developed and repositioned properties			613,443				735,428				3,013,511				2,092,081
Acquired property portfolios			190,711				2,406,795				353,886				2,406,795
Property management and other fees and incentives			35,502				27,095				97,572				72,679
Development management and other income			7,991				10,321				18,522				23,936
Total revenues			1,101,146				3,460,153				4,267,714				5,403,168
Expenses:
Rental expenses			85,822				74,835				262,710				216,658
Cost of CDFS dispositions:
Developed and repositioned properties			542,311				572,668				2,464,228				1,488,343
Acquired property portfolios			190,711				2,338,186				353,886				2,338,186
General and administrative			57,836				50,208				173,523				146,973
Depreciation and amortization			81,889				71,852				243,893				223,610
Other expenses			3,689				3,550				11,792				21,484
Total expenses			962,258				3,111,299				3,510,032				4,435,254
Operating income			138,888				348,854				757,682				967,914
Other income (expense):
Earnings from unconsolidated property funds, net			18,299				46,688				36,285				81,456
Earnings (losses) from CDFS joint ventures and other unconsolidated investees, net			2,192				4,679				(1,414	)			6,996
Interest expense			(83,327	)			(107,964	)			(252,587	)			(287,255	)
Interest and other income, net			1,822				11,613				17,082				32,522
Total other income (expense)			(61,014	)			(44,984	)			(200,634	)			(166,281	)
Earnings before minority interest			77,874				303,870				557,048				801,633
Minority interest share in loss (income), net			1,031				(1,855	)			4,510				(2,751	)
Earnings before certain net gains			78,905				302,015				561,558				798,882
Gains recognized on dispositions of certain non-CDFS business assets			1,152				21,289				5,814				145,374
Foreign currency exchange gains (losses), net			(10,344	)			991				(34,950	)			10,145
Earnings before income taxes			69,713				324,295				532,422				954,401
Income taxes:
Current income tax expense			11,577				14,204				49,101				58,949
Deferred income tax expense			10,742				11,892				19,478				5,710
Total income taxes			22,319				26,096				68,579				64,659
Earnings from continuing operations			47,394				298,199				463,843				889,742

(Continued)

PROLOGIS

CONSOLIDATED STATEMENTS OF
EARNINGS AND COMPREHENSIVE INCOME (LOSS) (CONTINUED)
(Unaudited)
(In thousands, except per share data)

		Three months ended								Nine months ended
		September 30,								September 30,
		2008				2007				2008				2007
Discontinued operations:
Income (loss) attributable to disposed properties and assets held for sale, net		$	(189	)		$	992			$	(296	)		$	3,693
Gains recognized on dispositions:
Non-CDFS business assets			2,492				6,607				8,161				38,732
CDFS business assets			108				—				2,232				22,537
Total discontinued operations			2,411				7,599				10,097				64,962
Net earnings			49,805				305,798				473,940				954,704
Less preferred share dividends			6,333				6,354				19,071				19,065
Net earnings attributable to common shares			43,472				299,444				454,869				935,639
Other comprehensive income (loss) items:
Foreign currency translation gains (losses), net			(279,436	)			88,700				(144,737	)			93,366
Unrealized gains (losses) on derivative contracts, net			827				(9,987	)			(7,966	)			(9,234	)
Comprehensive income (loss)		$	(235,137	)		$	378,157			$	302,166			$	1,019,771
Weighted average common shares outstanding — Basic			263,139				257,435				261,665				256,270
Weighted average common shares outstanding — Diluted			266,133				267,871				270,665				267,177
Net earnings per share attributable to common shares — Basic:
Continuing operations		$	0.16			$	1.13			$	1.70			$	3.40
Discontinued operations			0.01				0.03				0.04				0.25
Net earnings per share attributable to common shares — Basic		$	0.17			$	1.16			$	1.74			$	3.65
Net earnings per share attributable to common shares — Diluted:
Continuing operations		$	0.15			$	1.09			$	1.65			$	3.27
Discontinued operations			0.01				0.03				0.04				0.24
Net earnings per share attributable to common shares — Diluted		$	0.16			$	1.12			$	1.69			$	3.51
Distributions per common share		$	0.5175			$	0.46			$	1.5525			$	1.38

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

PROLOGIS

CONSOLIDATED BALANCE SHEETS
(In thousands, except per share data)

		September 30,
		2008				December 31,
		(Unaudited)				2007
ASSETS
Real estate		$	17,285,584			$	16,578,845
Less accumulated depreciation			1,523,778				1,368,458
			15,761,806				15,210,387
Investments in and advances to unconsolidated investees			2,570,571				2,345,277
Cash and cash equivalents			341,087				399,910
Accounts and notes receivable			301,116				340,039
Other assets			1,490,996				1,408,814
Discontinued operations — assets held for sale			1,487				19,607
Total assets		$	20,467,063			$	19,724,034
LIABILITIES AND SHAREHOLDERS’ EQUITY
Liabilities:
Debt		$	11,097,901			$	10,506,068
Accounts payable and accrued expenses			925,365				933,075
Other liabilities			759,887				769,408
Discontinued operations — assets held for sale			38				424
Total liabilities			12,783,191				12,208,975
Minority interest			111,615				78,661
Shareholders’ equity:
Series C Preferred Shares at stated liquidation preference of $50 per share; $0.01 par value; 2,000 shares issued and outstanding at September 30, 2008 and December 31, 2007			100,000				100,000
Series F Preferred Shares at stated liquidation preference of $25 per share; $0.01 par value; 5,000 shares issued and outstanding at September 30, 2008 and December 31, 2007			125,000				125,000
Series G Preferred Shares at stated liquidation preference of $25 per share; $0.01 par value; 5,000 shares issued and outstanding at September 30, 2008 and December 31, 2007			125,000				125,000
Common Shares; $0.01 par value; 262,652 shares issued and outstanding at September 30, 2008 and 257,712 shares issued and outstanding at December 31, 2007			2,627				2,577
Additional paid-in capital			6,660,352				6,412,473
Accumulated other comprehensive income			122,619				275,322
Retained earnings			436,659				396,026
Total shareholders’ equity			7,572,257				7,436,398
Total liabilities and shareholders’ equity		$	20,467,063			$	19,724,034

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

PROLOGIS

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

(In thousands)

		Nine months ended
		September 30,
		2008				2007
Operating activities:
Net earnings		$	473,940			$	954,704
Adjustments to reconcile net earnings to net cash provided by operating activities:
Minority interest share in (losses) earnings			(4,510	)			2,751
Straight-lined rents			(24,806	)			(34,042	)
Cost of share-based compensation awards			27,732				18,782
Depreciation and amortization			244,529				227,445
Equity in earnings from unconsolidated investees			(34,871	)			(88,452	)
Changes in operating receivables and distributions from unconsolidated investees			14,152				50,258
Amortization of deferred loan costs			9,140				7,827
Amortization of debt premium, net			(1,593	)			(6,813	)
Gains recognized on dispositions of non-CDFS business assets			(13,975	)			(184,106	)
Gains recognized on dispositions of CDFS business assets included in discontinued operations			(2,232	)			(22,537	)
Impairment charges			—				12,600
Unrealized foreign currency exchange losses, net			27,218				11,706
Deferred income tax expense			19,478				5,710
Increase in accounts and notes receivable and other assets			(59,020	)			(122,977	)
(Decrease) increase in accounts payable and accrued expenses and other liabilities			(11,471	)			199,665
Net cash provided by operating activities			663,711				1,032,521
Investing activities:
Real estate investments			(4,306,323	)			(3,640,109	)
Tenant improvements and lease commissions on previously leased space			(44,333	)			(50,095	)
Recurring capital expenditures			(27,208	)			(28,482	)
Purchase of Macquarie ProLogis Trust (“MPR”), net of cash acquired			—				(1,137,028	)
Cash consideration paid in Parkridge acquisition, net of cash acquired			—				(707,374	)
Investments in and net advances to unconsolidated investees			(149,347	)			(507,378	)
Return of investment from unconsolidated investees			98,046				39,087
Proceeds from dispositions of real estate assets			3,209,094				3,087,967
Proceeds from repayment of notes receivable			1,497				42,008
Net cash used in investing activities			(1,218,574	)			(2,901,404	)
Financing activities:
Proceeds from sales and issuances of common shares under various common share plans			217,107				26,664
Distributions paid on common shares			(414,236	)			(354,152	)
Dividends paid on preferred shares			(19,071	)			(19,065	)
Minority interest contributions (distributions), net			24,833				(7,065	)
Debt and equity issuance costs paid			(11,448	)			(8,602	)
Net proceeds from credit facilities			537,694				119,017
Proceeds from issuance of debt to finance MPR and Parkridge acquisitions			—				1,719,453
Proceeds from issuance of convertible senior notes			544,500				1,228,125
Proceeds from issuance of senior notes, secured and unsecured debt			599,612				6,459
Payments on senior notes, secured and unsecured debt and assessment bonds			(963,363	)			(787,391	)
Net cash provided by financing activities			515,628				1,923,443
Effect of foreign currency exchange rate changes on cash			(19,588	)			19,921
Net (decrease) increase in cash and cash equivalents			(58,823	)			74,481
Cash and cash equivalents, beginning of period			399,910				475,791
Cash and cash equivalents, end of period		$	341,087			$	550,272

See Note 12 for information on non-cash investing and financing activities and other information.

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

PROLOGIS

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

1. General:

     Business. ProLogis, collectively with our consolidated subsidiaries (“we”, “our”, “us”, “the Company” or “ProLogis”), is a publicly held real estate investment trust (“REIT”) that owns, operates and develops (directly and through our unconsolidated investees) primarily industrial distribution properties in North America, Europe and Asia. Our business consists of three reportable business segments: (i) property operations; (ii) investment management; and (iii) CDFS business. Our property operations segment represents the direct long-term ownership of industrial distribution and retail properties. Our investment management segment represents the long-term investment management of property funds and the properties they own. Our CDFS business segment primarily encompasses our development or acquisition of real estate properties that are generally contributed to a property fund in which we have an ownership interest and act as manager or sold to third parties. See Note 11 for further discussion of our business segments.

     Basis of Presentation. The accompanying consolidated financial statements, presented in the U.S. dollar, are prepared in accordance with U.S. generally accepted accounting principles (“GAAP”). GAAP requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities as of the date of the financial statements and revenue and expenses during the reporting period. Our actual results could differ from those estimates and assumptions. All material intercompany transactions with consolidated entities have been eliminated.

     The accompanying unaudited interim financial information has been prepared according to the rules and regulations of the U.S. Securities and Exchange Commission (“SEC”). Certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted in accordance with such rules and regulations. Our management believes that the disclosures presented in these financial statements are adequate to make the information presented not misleading. In our opinion, all adjustments and eliminations, consisting only of normal recurring adjustments, necessary to present fairly our financial position as of September 30, 2008 and our results of operations for the three and nine months ended September 30, 2008 and 2007 and cash flows for the nine months ended September 30, 2008 and 2007 have been included. The results of operations for such interim periods are not necessarily indicative of the results for the full year. The accompanying unaudited interim financial information should be read in conjunction with our December 31, 2007 Consolidated Financial Statements, as filed with the SEC in our Annual Report on Form 10-K, as amended.

     Certain amounts included in the accompanying consolidated financial statements for 2007 have been reclassified to conform to the 2008 financial statement presentation.

     Adoption of New Accounting Pronouncements. In September 2006, the Financial Accounting Standards Board (“FASB”) issued Statement of Financial Accounting Standards (“SFAS”) No. 157, “Fair Value Measurements” (“SFAS 157”). SFAS 157 defines fair value, establishes a framework for measuring fair value in accordance with GAAP and expands disclosures about fair value measurements. SFAS 157 applies to other accounting pronouncements that require or permit fair value measurements but does not require any new fair value measurements. In February 2008, the FASB issued FASB Staff Position No. FAS 157-2, “Effective Date of FASB Statement No.157” (“FSP FAS 157-2”), that delays the effective date of SFAS 157’s fair value measurement requirements for nonfinancial assets and liabilities that are not required or permitted to be measured at fair value on a recurring basis. The adoption of SFAS 157 on January 1, 2008 for financial assets and liabilities, primarily derivative contracts that we or our unconsolidated investees are party to, did not have a material impact on our financial position and results of operations. Fair value measurements identified in FSP FAS 157-2 will be effective for our fiscal year beginning January 1, 2009. We are currently assessing the impact, if any, that SFAS 157 will have on our financial position and results of operations, as it relates to nonfinancial assets and liabilities.

     Recent Accounting Pronouncements. In December 2007, the FASB issued SFAS No. 141R, “Business Combinations” (“SFAS 141R”) and SFAS No. 160, “Noncontrolling Interests in Consolidated Financial Statements — An Amendment of ARB No. 51” (“SFAS 160”). SFAS 141R and SFAS 160 require most identifiable assets, liabilities, noncontrolling interests and goodwill acquired in a business combination to be recorded at “full fair value” and require noncontrolling interests (previously referred to as minority interests) to be reported as a

PROLOGIS

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
(Unaudited)

component of equity, which changes the accounting for transactions with noncontrolling interest holders. The provisions of SFAS 141R and SFAS 160 are effective for our fiscal year beginning January 1, 2009. SFAS 141R will be applied to business combinations occurring after the effective date and SFAS 160 will be applied prospectively to all changes in noncontrolling interests, including any that existed at the effective date. We are currently assessing what impact the adoption of SFAS 141R and SFAS 160 will have on our financial position and results of operations.

     In March 2008, the FASB issued SFAS No. 161, “Disclosures about Derivative Instruments and Hedging Activities — an amendment of FASB Statement No. 133” (“SFAS 161”). SFAS 161 requires enhanced disclosures related to derivative instruments and hedging activities. SFAS 161 will require disclosures relating to: (i) how and why an entity uses derivative instruments; (ii) how derivative instruments and related hedge items are accounted for under SFAS No. 133, “Accounting for Derivative Instruments and Hedging Activities”; and (iii) how derivative instruments and related hedged items affect an entity’s financial position, financial performance and cash flows. SFAS 161 must be applied prospectively and will be effective for our fiscal year beginning January 1, 2009, although early adoption is allowed. We do not expect the adoption of SFAS 161 in 2009 to have an impact on our financial position or results of operations.

     In May 2008, the FASB issued FASB Staff Position No. APB 14-1 “Accounting for Convertible Debt Instruments that May Be Settled in Cash Upon Conversion (Including Partial Cash Settlement)” that requires separate accounting for the debt and equity components of convertible debt. The value assigned to the debt component is the estimated fair value of a similar bond without the conversion feature, which would result in the debt being recorded at a discount. The resulting debt discount would be amortized over the period during which the debt is expected to be outstanding (for example, through the first optional redemption date) as additional non-cash interest expense. The effective date is January 1, 2009 with the application of the new accounting applied retrospectively to both new and existing convertible instruments, including the convertible notes we issued in 2007 and 2008. As a result of the new accounting, beginning in 2009, we will recognize an additional non-cash interest expense, for purposes of calculating earnings, of between $64 million and $82 million per annum, prior to the capitalization of interest as a result of our development activities. In addition, we will be required to restate our 2007 and 2008 results to reflect the additional non-cash interest expense for the periods the convertible notes were outstanding in those years.

2. Mergers and Acquisitions:

     In February 2007, we purchased the industrial business and made a 25% investment in the retail business of Parkridge Holdings Limited (“Parkridge”), a European developer. The total purchase price was $1.3 billion, which was financed with $733.9 million in cash, $339.5 million of equity (4.8 million common shares valued for accounting purposes at $71.01 per share) and the remainder through the assumption of debt and other liabilities. The cash portion of the acquisition was funded with borrowings under our global senior credit facility (“Global Line”) and a new multi-currency credit facility.

3. Unconsolidated Investees:

Summary of Investments

     Our investments in and advances to unconsolidated investees, which are accounted for under the equity method, are summarized by type of investee as follows (in thousands):

		September 30,				December 31,
		2008				2007
Property funds		$	1,865,609			$	1,755,113
CDFS joint ventures and other unconsolidated investees			704,962				590,164
Totals		$	2,570,571			$	2,345,277

PROLOGIS

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
(Unaudited)

Property Funds

     We recognize fees and incentives and our proportionate share of net earnings or losses, related to our investments in property funds, as follows (in thousands):

		Three months ended								Nine months ended
		September 30,								September 30,
		2008				2007				2008				2007
Earnings (losses) from unconsolidated property funds:
North America		$	4,408			$	5,163			$	(1,798	)		$	16,804
Europe			7,277				37,167				16,977				51,635
Asia			6,614				4,358				21,106				13,017
Total earnings from unconsolidated property funds		$	18,299			$	46,688			$	36,285			$	81,456
Property management and other fees and incentives:
North America		$	15,423			$	11,487			$	44,734			$	31,258
Europe			15,181				10,139				39,957				31,031
Asia			4,898				5,469				12,881				10,390
Total property management and other fees and incentives		$	35,502			$	27,095			$	97,572			$	72,679

     In our CDFS business segment, as further discussed in Note 11, we develop and acquire real estate properties with the intent to contribute the properties to various property funds in which we have an ownership interest and act as manager. Upon contribution of properties to a property fund, we realize a portion of the profits from our CDFS activities due to the increased fair value, based on third party appraisals, and to the extent of third party ownership in the property fund. After we contribute the property, we continue to maintain a long-term ownership interest in our CDFS properties. This business strategy has provided us liquidity to fund our development activities and has increased fee income. We generally receive ownership interests in the property funds (based on our pre-contribution interest) as part of the proceeds generated by the contributions of properties. The property funds generally own operating properties that we have contributed to them, although certain of the property funds have also acquired properties from third parties.

     Property management and other fees and incentives include fees and incentives earned for services performed on behalf of the property funds and our fund partners. We earn fees for acting as the manager and earn additional fees by providing other services including, but not limited to, acquisition, development, construction management, leasing and financing activities. We may also earn incentive performance returns based on our fund partners’ returns over a specified period.

     Information about our investments in the property funds is as follows (dollars in thousands):

		Ownership Percentage								Investment in and Advances to
		September 30,				December 31,				September 30,				December 31,
Property Fund		2008				2007				2008				2007
ProLogis California			50.0	%			50.0	%		$	102,298			$	106,630
ProLogis North American Properties Fund I			41.3	%			41.3	%			25,658				27,135
ProLogis North American Properties Fund VI			20.0	%			20.0	%			36,028				37,218
ProLogis North American Properties Fund VII			20.0	%			20.0	%			31,965				31,321
ProLogis North American Properties Fund VIII			20.0	%			20.0	%			13,848				14,982
ProLogis North American Properties Fund IX			20.0	%			20.0	%			13,509				13,986
ProLogis North American Properties Fund X			20.0	%			20.0	%			15,620				15,721
ProLogis North American Properties Fund XI			20.0	%			20.0	%			28,590				30,712
ProLogis North American Industrial Fund (1)			23.2	%			23.2	%			132,841				104,277
ProLogis North American Industrial Fund II (2)			36.9	%			36.9	%			268,196				274,238
ProLogis North American Industrial Fund III (3)			20.0	%			20.0	%			126,186				123,720
ProLogis Mexico Industrial Fund (4)			20.0	%			20.0	%			102,452				38,085
ProLogis European Properties (“PEPR”) (5)			24.9	%			24.9	%			443,838				494,593
ProLogis European Properties Fund II (“PEPF II”) (6)			24.5	%			24.3	%			203,875				158,483
ProLogis Japan Properties Fund I			20.0	%			20.0	%			92,030				87,663
ProLogis Japan Properties Fund II			20.0	%			20.0	%			191,983				189,584
ProLogis Korea Fund (7)			20.0	%			20.0	%			21,288				6,765
ProLogis China Acquisition Fund (8)			33.0	%			—				15,404				—
Totals										$	1,865,609			$	1,755,113

PROLOGIS

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
(Unaudited)

PROLOGIS

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
(Unaudited)

     We are committed to offer to contribute substantially all of the properties that we develop and stabilize in certain markets to the following funds, subject to the property meeting certain leasing and other criteria, other than the ProLogis China Acquisition Fund that was formed to acquire properties from third parties. The following table outlines acquisitions made by these property funds from ProLogis and third parties during the nine months ended September 30, 2008, including the related financing of such acquisitions, and the remaining equity commitments of each property fund from us and our fund partners as of September 30, 2008 (in millions):

																																		Available
		Fund Acquisitions																				Remaining Equity Commitments (1)												Under
						Third												Equity								Fund				Expiration				Credit
		ProLogis				Parties				Total				Debt				and Other				ProLogis				Partners				Date				Facility
ProLogis North American Industrial Fund		$	615.2			$	—			$	615.2			$	332.1			$	283.1			$	120.3			$	506.1				2/09	(2)		$	64.3
ProLogis Mexico Industrial Fund			91.4				189.8				281.2				133.7				147.5				64.7				246.7				8/10				—
ProLogis European Properties Fund II			1,870.6				84.0				1,954.6				801.0				1,153.6				447.6				2,185.4	(3)			8/10				291.1
ProLogis Japan Properties Fund II			683.9				83.7				767.6				457.9				309.7				47.7				190.7				9/10				—
ProLogis Korea Fund			—				81.2				81.2				8.4				72.8				25.4				101.7				6/10				—
ProLogis China Acquisition Fund			83.6				—				83.6				—				83.6				315.2				640.0				4/12				—
Total		$	3,344.7			$	438.7			$	3,783.4			$	1,733.1			$	2,050.3			$	1,020.9			$	3,870.6							$	355.4

     Summarized financial information of the property funds (for the entire entity, not our proportionate share) and our investment in such funds is presented below (dollars in millions):

		2008
		North
		America				Europe				Asia				Total
For the three months ended September 30, 2008:
Revenues		$	216.3			$	171.8			$	77.5			$	465.6
Net earnings (losses)(1)		$	(2.3	)		$	23.0			$	24.0			$	44.7
For the nine months ended September 30, 2008:
Revenues		$	622.5			$	480.3			$	212.7			$	1,315.5
Net earnings (losses)(1)		$	(43.8	)		$	50.2			$	83.9			$	90.3
As of September 30, 2008:
Total assets		$	9,813.4			$	8,478.4			$	4,929.1			$	23,220.9
Amounts due to us		$	53.8			$	38.2			$	123.3			$	215.3
Third party debt (2)		$	5,767.7			$	4,534.3			$	2,414.2			$	12,716.2
Total liabilities		$	6,052.8			$	5,250.6			$	3,214.2			$	14,517.6
Minority interest		$	15.1			$	11.8			$	—			$	26.9
Equity		$	3,745.5			$	3,215.9			$	1,715.0			$	8,676.4
Our weighted average ownership (3)			27.4	%			24.7	%			20.1	%			25.0	%
Our investment balance (1)(4)		$	897.2			$	647.7			$	320.7			$	1,865.6
Deferred gains, net of amortization (5)		$	242.7			$	268.7			$	159.2			$	670.6

PROLOGIS

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
(Unaudited)

		2007
		North
		America				Europe				Asia				Total
For the three months ended September 30, 2007:
Revenues		$	161.6			$	120.8			$	47.3			$	329.7
Net earnings (6)		$	9.1			$	148.6			$	17.1			$	174.8
For the nine months ended September 30, 2007:
Revenues		$	441.1			$	361.0			$	120.5			$	922.6
Net earnings (6)		$	42.6			$	202.5			$	53.2			$	298.3
As of December 31, 2007:
Total assets		$	9,034.7			$	6,526.4			$	3,810.5			$	19,371.6
Amounts due to us		$	24.8			$	70.0			$	109.1			$	203.9
Third party debt (2)		$	5,305.2			$	3,456.2			$	1,889.5			$	10,650.9
Total liabilities		$	5,678.5			$	4,057.7			$	2,550.7			$	12,286.9
Minority interest		$	17.4			$	10.8			$	—			$	28.2
Equity		$	3,338.8			$	2,457.8			$	1,259.9			$	7,056.5
Our weighted average ownership (3)			27.9	%			24.8	%			20.0	%			25.5	%
Our investment balance (1)(4)		$	818.0			$	653.1			$	284.0			$	1,755.1
Deferred gains, net of amortization (5)		$	216.4			$	193.9			$	127.0			$	537.3

PROLOGIS

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
(Unaudited)

CDFS joint ventures and other unconsolidated investees

     At September 30, 2008, we had investments in entities that perform some of our CDFS business activities (the “CDFS joint ventures”) and certain other investments. The CDFS joint ventures include entities that develop and own distribution and retail properties, along with entities that perform land and mixed-use development activity. The other operating joint ventures primarily include entities that own a hotel property and office properties.

     We have recognized our proportionate share of the earnings (losses) from the CDFS joint ventures and other unconsolidated investees as follows (in thousands):

		Three months ended								Nine months ended
		September 30,								September 30,
		2008				2007				2008				2007
North America		$	2,716			$	949			$	10,604			$	5,016
Europe			2,492				399				1,825				979
Asia			(3,016	)			3,331				(13,843	)			1,001
Total earnings (losses) from CDFS joint ventures and other unconsolidated investees		$	2,192			$	4,679			$	(1,414	)		$	6,996

     Our investments in and advances to these entities are as follows (in thousands):

		September 30,				December 31,
		2008				2007
CDFS joint ventures:
North America		$	63,550			$	60,502
Europe (1)			302,464				228,396
Asia (2)			230,713				194,583
Total CDFS joint ventures			596,727				483,481
Other unconsolidated investees			108,235				106,683
Total		$	704,962			$	590,164

PROLOGIS

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
(Unaudited)

4. Long-Term Compensation:

     We recognized share-based compensation expense of $10.1 million and $4.7 million for the three months ended September 30, 2008 and 2007, respectively, and $27.7 million and $18.8 million for the nine months ended September 30, 2008 and 2007, respectively. These amounts include the expense related to awards granted to our outside trustees, and are net of $3.4 million and $2.7 million for the three months ended September 30, 2008 and 2007, respectively, and $9.5 million and $7.9 million for the nine months ended September 30, 2008 and 2007, respectively, that was capitalized due to our development and leasing activities.

     During the three months ended September 30, 2008 and 2007, we recorded $2.3 million and zero, respectively, and during the nine months ended September 30, 2008 and 2007, we recorded $6.3 million and $8.0 million, respectively, of employee departure costs. In 2008, these costs relate to the planned retirement of our Chief Operating Officer in January 2009. In 2007, these costs included $5.0 million related to the departure of our Chief Financial Officer in March 2007 and $3.0 million related to other employees.

     Our long-term incentive plans provide for grants of share options, stock appreciation rights, full value awards and cash incentive awards to employees and other persons, including outside trustees. The full value awards include restricted share units (“RSUs”) and contingent performance shares (“CPSs”).

Summary of Activity

     The activity for the nine months ended September 30, 2008, with respect to our share options, is as follows:

		Options Outstanding
		Number of				Weighted Average
		Options				Exercise Price				Options Exercisable
Balance at December 31, 2007			7,998,410			$	36.63				5,504,282
Granted			3,976				57.21
Exercised			(1,066,461	)			23.92
Forfeited			(89,777	)			53.52
Balance at September 30, 2008			6,846,148			$	38.40				4,896,787

     The activity for the nine months ended September 30, 2008, with respect to our full value awards, is as follows:

		Number of				Weighted Average				Number of
		Shares				Original Value				Shares Vested
Balance at December 31, 2007			2,554,786
Granted (1)			404,503
Exercised			(329,715	)
Forfeited			(50,274	)
Balance at September 30, 2008			2,579,300			$	48.64				585,958

PROLOGIS

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
(Unaudited)

5. Income Taxes:

     We and one of our consolidated subsidiaries have elected to be taxed as a REIT under the Internal Revenue Code of 1986, as amended, (the “Code”), and are not generally required to pay federal income taxes if we make distributions in excess of taxable income and meet the REIT requirements of the Code. We have elected taxable REIT subsidiary (“TRS”) status for some of our consolidated subsidiaries, which operate primarily in the CDFS business segment. Such elections allow us to provide services that would otherwise be considered impermissible for REITs. Many of the foreign countries where 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, if any, associated with our unrecognized tax benefit liabilities.

     We have recorded liabilities for unrecognized tax benefits as of September 30, 2008 and December 31, 2007 of $194.1 million and $192.4 million, respectively. FASB Interpretation No. 48, "Accounting for Uncertainty in Income Taxes — An Interpretation of FASB Statement No. 109” defines these liabilities as the difference between a tax position taken or expected to be taken in a tax return and the benefit measured and recognized in the financial statements. These liabilities consist of estimated federal, state and certain international jurisdictional income tax liabilities and interest and penalties, if any. Certain Catellus tax returns for the tax years 1999 through 2005 are under examination by the IRS and state tax authorities. Included in the liabilities for unrecognized tax benefits is our best estimate of the liability we will incur related to these audits. We are currently involved in discussions with the IRS related to these audits, however, the timing and the amount of any settlement are uncertain at this time.

     Deferred income tax expense is generally a function of the period’s temporary differences, the utilization of tax net operating losses generated in prior years that had been previously recognized as deferred income tax assets and deferred income tax liabilities related to indemnification agreements for contributions to certain property funds.

     For federal income tax purposes, certain acquisitions have been treated as tax-free transactions resulting in a carry-over basis for tax purposes. For financial reporting purposes and in accordance with purchase accounting, we record all of the acquired assets and liabilities at the estimated fair values at the date of acquisition. For our TRSs, 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 assets at the date of acquisition. As taxable income is generated in these subsidiaries, we recognize a deferred income tax 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. Any increases or decreases to the deferred income tax liability recorded in connection with these acquisitions, related to tax uncertainties acquired, will be reflected as an adjustment to goodwill.

Indemnification Agreements

     We have indemnification agreements related to most property funds operating outside of the United States for the contribution of certain properties. Under these agreements we indemnify the funds, or our fund partners, for taxes that may be assessed related to the capital gains associated with the step up in the value of the underlying real estate assets when we contribute to these funds.

     The ultimate outcome under these agreements is uncertain as it is dependent on the method and timing of dissolution of the related property fund or disposition of any properties by the property fund. Two of our previous agreements were terminated without any amounts being due or payable by us. We consider the probability, timing and amounts in estimating our potential liability under the agreements, which we have estimated as $38.4 million and $15.5 million at September 30, 2008 and December 31, 2007, respectively. We continue to monitor these agreements and the likelihood of the sale of assets that would result in recognition of a liability. We will adjust the potential liability in the future as facts and circumstances dictate.

PROLOGIS

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
(Unaudited)

6. Discontinued Operations:

     At September 30, 2008 and December 31, 2007, we had one property and two properties, respectively, that were classified as held for sale on our Consolidated Balance Sheets. The two properties that were classified as held for sale at December 31, 2007 were sold in the first quarter of 2008. The operations of the properties held for sale or disposed of to third parties during the nine months ended September 30, 2008 and the full year of 2007, including land subject to ground leases, and the aggregate net gains recognized upon their disposition are presented as discontinued operations in our Consolidated Statements of Earnings and Comprehensive Income (Loss) for all periods presented. Interest expense is included in discontinued operations only if it is directly attributable to these properties.

     The income (loss) attributable to discontinued operations is summarized as follows (in thousands):

		Three months ended								Nine months ended
		September 30,								September 30,
		2008				2007				2008				2007
Rental income		$	81			$	2,613			$	1,334			$	12,502
Rental expenses			(229	)			(969	)			(994	)			(4,974	)
Depreciation and amortization			(41	)			(652	)			(636	)			(3,835	)
Income (loss) attributable to disposed properties and assets held for sale		$	(189	)		$	992			$	(296	)		$	3,693

     The following information relates to properties and land parcels subject to ground leases disposed of to third parties, during the periods presented, and recorded as discontinued operations, including minor adjustments to previous dispositions (in thousands, except number of properties):

		Three months ended								Nine months ended
		September 30,								September 30,
		2008				2007				2008				2007
Non-CDFS business assets:
Number of properties			3				16				7				67
Net proceeds from dispositions		$	11,220			$	33,679			$	62,514			$	199,879
Net gains from dispositions		$	2,492			$	6,607			$	8,161			$	38,732
CDFS business assets:
Number of properties			1				—				2				4
Net proceeds from dispositions		$	3,689			$	—			$	18,897			$	173,298
Net gains from dispositions		$	108			$	—			$	2,232			$	22,537

7. Earnings Per Common Share:

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

PROLOGIS

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
(Unaudited)

     The following table sets forth the computation of our basic and diluted earnings per share (in thousands, except per share amounts):

		Three months ended								Nine months ended
		September 30,								September 30,
		2008				2007				2008				2007
Net earnings attributable to common shares		$	43,472			$	299,444			$	454,869			$	935,639
Minority interest (1)(2)			—				947				3,665				3,409
Adjusted net earnings attributable to common shares		$	43,472			$	300,391			$	458,534			$	939,048
Weighted average common shares outstanding — Basic			263,139				257,435				261,665				256,270
Incremental weighted average effect of conversion of limited partnership units (2)			—				5,011				5,088				5,086
Incremental weighted average effect of potentially dilutive instruments (3)			2,994				5,425				3,912				5,821
Weighted average common shares outstanding — Diluted			266,133				267,871				270,665				267,177
Net earnings per share attributable to common shares — Basic		$	0.17			$	1.16			$	1.74			$	3.65
Net earnings per share attributable to common shares — Diluted		$	0.16			$	1.12			$	1.69			$	3.51

8. Real Estate:

     Real estate assets, including CDFS properties pending contribution or disposition, are presented at cost, and consist of the following (in thousands):

		September 30,				December 31,
		2008				2007
Distribution operating properties (1):
Improved land		$	2,330,806			$	2,247,013
Buildings and improvements			9,026,112				8,799,318
Retail operating properties (2):
Improved land			66,255				77,536
Buildings and improvements			264,426				250,884
Land subject to ground leases and other			404,422				412,530
Properties under development, including cost of land (3)			1,871,141				1,986,285
Land held for development (4)			2,712,379				2,152,960
Other investments (5)			610,043				652,319
Total real estate assets			17,285,584				16,578,845
Less accumulated depreciation			1,523,778				1,368,458
Net real estate assets		$	15,761,806			$	15,210,387

PROLOGIS

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
(Unaudited)

     We own real estate assets in North America (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 South Korea).

     During the nine months ended September 30, 2008, we acquired 21 distribution properties aggregating 5.0 million square feet with a combined purchase price of $271.5 million.

     Our largest customer and 25 largest customers accounted for 2.28% and 19.38%, respectively, of our annualized collected base rents at September 30, 2008.

9. Debt:

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

		September 30, 2008								December 31, 2007
		Weighted								Weighted
		Average				Amount				Average				Amount
		Interest Rate				Outstanding				Interest Rate				Outstanding
Global Line			3.31	%		$	2,427,683				3.20	%		$	1,955,138
Multi-currency credit facility			5.42	%			551,960				5.22	%			609,222
Senior notes and other unsecured debt			5.62	%			4,290,929				5.46	%			4,281,884
Convertible senior notes			2.18	%			2,884,055				2.07	%			2,332,905
Secured debt			6.76	%			912,636				6.55	%			1,294,809
Assessment bonds			6.56	%			30,638				6.62	%			32,110
Totals			4.31	%		$	11,097,901				4.41	%		$	10,506,068

     Our credit facilities provide aggregate borrowing capacity of $4.4 billion at September 30, 2008. This includes our Global Line, where a syndicate of banks allows us to draw funds in U.S. dollar, euro, Japanese yen, British pound sterling, Chinese renminbi, South Korean won and Canadian dollar. This also includes a multi-currency credit facility (“Credit Facility”) that allows us to borrow in U.S. dollar, euro, Japanese yen, and British pound sterling and a 35 million pound sterling facility. The total commitments under our credit facilities fluctuate in U.S. dollars based on the underlying currencies. Based on our public debt ratings, interest on the borrowings under the Global Line and Credit Facility primarily accrues at a variable rate based upon the interbank offered rate in each respective jurisdiction in which the borrowings are outstanding, except for the renminbi tranche, which accrues interest based upon the People’s Bank of China rate. The Global Line and Credit Facility mature in October 2009; however, we can exercise a 12-month extension at our option for all currencies, except for the renminbi, which matures in May 2009. We are currently working to extend and increase the renminbi tranche. The Credit Facility

PROLOGIS

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
(Unaudited)

provides us the ability to re-borrow, within a specified period of time, any amounts repaid on the facility. As of September 30, 2008, under these facilities, we had outstanding borrowings of $3.0 billion and letters of credit of $204.8 million, resulting in remaining borrowing capacity of approximately $1.2 billion.

     In May 2008, we closed on $600.0 million of senior notes maturing 2018 with a coupon rate of 6.625% and $550.0 million of 2.625% convertible senior notes due 2038. The proceeds were used to repay $346.6 million of secured debt that was scheduled to mature in November 2008, borrowings on our credit facilities and for general corporate purposes. The convertible notes are convertible at the holder’s option after February 2013 and redeemable at our option after May 2013, and in limited circumstances before then. In addition, we issued convertible senior notes in 2007 ($1.25 billion in March 2007 and $1.12 billion in November 2007). These notes are convertible at the holders option or redeemable at our option after 2012, and in limited circumstances before then. As such, these notes have been reflected in the maturities table below based on the earliest possible conversion date of 2012 and 2013, although the actual maturity dates of these notes is 2037 for the 2007 issuances and 2038 for the 2008 issuances. Although it is our intent to settle the principal balance of the convertible notes in cash, we have the legal right to settle in either cash or shares. See also Note 1 for a change in accounting that will impact the accounting for the convertible senior notes beginning January 1, 2009.

     In October 2008, we finalized a new eight-year term line of credit for 5.0 billion renminbi (or $730.0 million at September 30, 2008) that may be used by us to fund future development projects in China, by the ProLogis China Acquisition Fund, which we recently formed, or by other property funds in China that we may form in the future.

Long-Term Debt Maturities

     Principal payments due on our debt, excluding credit facilities, for the remainder of 2008 and for each of the years in the five-year period ending December 31, 2013 and thereafter are as follows (in thousands):

2008		$	4,818
2009			352,662
2010			558,897
2011			554,456
2012 (1)			3,073,628
2013 (1)			937,137
Thereafter			2,643,865
Total principal due			8,125,463
Less: discount, net			7,205
Total carrying value		$	8,118,258

     As of September 30, 2008, we are in compliance with all of our debt covenants.

10. Shareholders’ Equity:

     During the nine months ended September 30, 2008, we sold and/or issued common shares under various common share plans, including share-based compensation plans, as follows (in thousands):

		Shares				Proceeds
1999 dividend reinvestment plan			64			$	3,279
Incentive plan and outside trustee plan			1,480			$	15,727
Controlled equity offering program			3,366			$	196,381
Employee share plan			31			$	1,413

PROLOGIS

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
(Unaudited)

11. Business Segments:

     We have three reportable business segments:

	•		Property operations — representing the direct long-term ownership of industrial distribution and retail properties. 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. We also include the net operating income and assets of CDFS business segment properties during the period when they have operations, as the economic characteristics are similar at that point in time and the primary activity associated with the property during that period is leasing. In addition, the costs of our property management function for both our direct-owned portfolio and the properties owned by the property funds and managed by us are all reported in rental expenses in the property operations segment. Our operations in the property operations business segment are in North America (Canada, Mexico and the United States), Europe (the Czech Republic, France, Germany, Hungary, Italy, the Netherlands, Poland, Romania, Slovakia, Spain and the United Kingdom) and Asia (China, Japan and South Korea).
	•		Investment management — representing the long-term investment management of property funds and the properties they own. We recognize our proportionate share of the earnings or losses from our investments in unconsolidated property funds under the equity method. Also, we include fees earned for services performed on behalf of the property funds, interest earned on advances to the property funds and incentives earned based on investors’ returns. We utilize our leasing and property management expertise to manage the properties and the funds, and we report the costs as part of rental expenses in the property operations segment. The assets of the investment management segment include our investments in and advances to the unconsolidated property funds. Each investment in a property fund is considered to be an individual operating segment having similar economic characteristics that are combined within the reportable segment based upon geographic location. Our operations in the investment management segment are in North America (Canada, Mexico and the United States), Europe (Belgium, the Czech Republic, France, Germany, Hungary, Italy, the Netherlands, Poland, Slovakia, Spain, Sweden and the United Kingdom) and Asia (China, Japan and South Korea).
	•		CDFS business — primarily encompasses our development of real estate properties that are subsequently contributed to a property fund in which we maintain an ownership interest and act as manager, or sold to third parties. Additionally, we acquire properties with the intent to rehabilitate and/or reposition the property in the CDFS business segment prior to contributing to a property fund. The proceeds and related costs of these dispositions are presented as Developed and Repositioned Properties in the Consolidated Statements of Earnings and Comprehensive Income (Loss). In addition, we occasionally acquire a portfolio of properties with the intent of contributing the portfolio to an existing or future property fund. The proceeds and related costs of these dispositions are presented as Acquired Property Portfolios in the Consolidated Statements of Earnings and Comprehensive Income (Loss). We also have investments in several unconsolidated entities that perform development activities and we include our proportionate share of their earnings or losses in this segment. Additionally, we include fees earned for development activities performed on behalf of customers or third parties, interest income earned on notes receivable related to asset sales to third parties or development activities and gains on the disposition of land parcels, including land subject to ground leases. As discussed above, during the period these properties have operations, the net operating income and assets are included in the Property Operations segment. The separate activities in this segment are considered to be individual operating segments having similar economic characteristics that are combined within the reportable segment based upon geographic location. Our CDFS business segment operations are in North America (Canada, Mexico and the United States), in Europe (Austria, Belgium, the Czech Republic, France, Germany, Hungary, Italy, the Netherlands, Poland, Romania, Slovakia, Spain, Sweden and the United Kingdom) and in Asia (China, Japan and South Korea).

     We have other operating segments that do not meet the threshold criteria to disclose as a reportable segment, primarily the management of land subject to ground leases in the United States. Each ground lease is considered to be an individual operating segment.

PROLOGIS

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
(Unaudited)

     We generally present the operations and net gains associated with properties sold to third parties as discontinued operations. Accordingly, these amounts are excluded from the segment presentation. See Note 6 for detail of our discontinued operations.

     Reconciliations are presented below for: (i) each reportable business segment’s revenue from external customers to our total revenues; (ii) each reportable business segment’s net operating income from external customers to our earnings before minority interest; and (iii) each reportable business segment’s assets to our total assets. 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 our revenues, earnings before minority interest 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:

		Three months ended								Nine months ended
		September 30,								September 30,
		2008				2007				2008				2007
Revenues:
Property operations (1):
North America		$	203,658			$	227,745			$	621,422			$	654,570
Europe			22,803				33,300				79,584				86,239
Asia			15,019				9,234				46,751				36,774
Total property operations segment			241,480				270,279				747,757				777,583
Investment management (2):
North America			19,831				16,650				42,936				48,062
Europe			22,458				47,306				56,934				82,666
Asia			11,512				9,827				33,987				23,407
Total investment management segment			53,801				73,783				133,857				154,135
CDFS business (3):
North America			134,511				2,311,787				731,199				2,752,240
Europe			533,589				844,567				1,926,835				1,125,590
Asia			145,614				2,917				722,063				656,114
Total CDFS business segment			813,714				3,159,271				3,380,097				4,533,944
Total segment revenues			1,108,995				3,503,333				4,261,711				5,465,662
Other — North America			12,019				10,235				36,466				30,094
Reconciling item (4)			(19,868	)			(53,415	)			(30,463	)			(92,588	)
Total revenues		$	1,101,146			$	3,460,153			$	4,267,714			$	5,403,168