ProLogis Reports 9.6% Increase in First Quarter Funds From Operations

Strong Operating Property Performance and Corporate Distribution Facilities

Business Drive Results; Second North American Properties Fund Established



Apr 25, 2001, 01:00 ET from ProLogis

    DENVER, April 25 /PRNewswire/ -- ProLogis (NYSE:   PLD), a leading global
 provider of distribution services and facilities, reported a 9.6% increase in
 funds from operations (FFO) per diluted share for the quarter ended March 31,
 2001, to $.57 per diluted share, from $.52 per diluted share in 2000.
     (Photo:  http://www.newscom.com/cgi-bin/prnh/19990420/PROLOGIS )
     "Our solid first quarter results were driven by the strong performance of
 our operating properties, with rental rate growth of 20.2% and same store net
 operating income growth of 3.9%.  In addition, our Corporate Distribution
 Facilities business outperformed while our temperature-controlled operations
 met our expectations," said K. Dane Brooksher, chairman and chief executive
 officer.  "We also formed our second ProLogis North American Properties Fund,
 which will increase return on invested capital while providing the capital
 necessary to serve our customers' needs for new distribution facilities."
     "In addition, we strengthened our balance sheet during the first quarter
 with the redemption of our Series B Convertible Preferred Shares and a
 reduction in borrowings under our revolving lines of credit, significantly
 improving both our interest coverage and fixed coverage ratios.  We are also
 in the final stages of completing the first ever pan-European commercial
 mortgage-backed securities offering in Europe to provide permanent financing
 within the ProLogis European Properties Fund.  The issue, which is rated
 Aaa/AAA by Moody's and S&P, raised over 212 million euros at a spread of 35 to
 37 basis points over Euribor," Mr. Brooksher added.
     "While we are cautious in our outlook for the remainder of the year, we
 are well positioned during this time of economic uncertainty due to the
 strength of our customer relationships, the geographic breadth of our
 operating portfolio, our leading positions in key global logistics markets,
 our ability to self-fund operations and our financial strength," Mr. Brooksher
 added.
 
     Distribution Efficiencies Drive Corporate Distribution Facilities Business
 
     "We continue to experience demand for new space in key North American
 logistics markets as customers look for ways to reduce their distribution
 costs," said Irving F. Lyons, III, president and chief investment officer.
 North American build-to-suit leases signed in the first quarter include
 facilities for Procter & Gamble and Sears Logistics.  "In Europe,
 reconfiguration of distribution networks related to European unification
 continues to be a major driver of demand.  In the first quarter, we signed
 over 1.9 million square feet of pre-leased development agreements in Europe,
 including new facilities for Samsung in the Netherlands and Schneider Electric
 in Spain and Exel on behalf of Safeway in the U.K."
 
     Property Funds Enhance Returns and Fund Development Pipeline
 
     "Our development pipeline is funded from both dispositions of non-core
 assets and contributions of recent developments into our property funds, which
 totaled $393 million in the first quarter," said Mr. Lyons.  "Through our
 unique fund structure, we ensure a predictable source of funding for our
 development business, eliminating the need for us to access the public capital
 markets thereby diluting shareholders.  In addition, because we reinvest our
 development gains back into our stabilized property funds, we earn an
 attractive current return on our capital, and can also earn incentive returns
 based upon future performance."  During the quarter, the company formed
 ProLogis North American Properties Fund II with a contribution of $232 million
 in properties.  ProLogis will retain an ownership in the Fund of not less than
 20%.
 
     ProLogis is a leading global provider of integrated distribution
 facilities and services, with 1,700 distribution facilities owned, operating
 and under development throughout North America and Europe.  ProLogis has built
 the industry's first and only global network of distribution facilities with
 the primary objective to build shareholder value by becoming the leading
 provider of distribution services.  The company expects to achieve this
 objective through the ProLogis Operating System(TM) and its commitment to be
 'The Global Distribution Solution' by providing exceptional corporate
 distribution services and facilities to meet customer expansion and
 reconfiguration needs globally.  As of March 31, 2001, ProLogis owned, managed
 or had under development a total of 196.9 million square feet (18.3 million
 Sq. Meters) of distribution facilities, in 98 global markets.
 
     In addition to historical information, this press release contains
 forward-looking statements under the federal securities laws.  These
 statements are based on current expectations, estimates and projections about
 the industry and markets in which ProLogis operates, management's beliefs and
 assumptions made by management.  Forward-looking statements are not guarantees
 of future performance and involve certain risks and uncertainties which are
 difficult to predict.  Actual operating results may be affected by changes in
 national and local economic conditions, competitive market conditions, changes
 in financial markets or interest rates that could adversely affect ProLogis'
 ability to meet its financing needs and obligations, weather, obtaining
 governmental approvals and meeting development schedules, and therefore, may
 differ materially from what is expressed or forecasted in this press release.
 
     A copy of ProLogis' first quarter 2001 supplemental information will be
 available from the company's web site at http://www.prologis.com or by request
 at 800/820-0181.  The company's conference call will be available via a live
 webcast on the company's website at www.prologis.com at 10:00 EDT on Thursday,
 April 26, 2001.  The replay of the call will be available on the company's web
 site or at www.streetfusion.com or at www.streetevents.com.
 
 
                                 ProLogis Trust
 
                               First Quarter 2001
                          Unaudited Financial Results
 
              Consolidated Statements of Funds from Operations (A)
                    (in thousands, except per share amounts)
 
                                                                   ProForma
                                                                 Three Months
                                        Three Months Ended          Ended
                                            March 31,             March 31,
                                       2001           2000           2000
     Revenues:
       Rental income (B)            $119,764        $120,809      $121,819
       Corporate distribution
        facilities services
        income (C)                    42,854          25,468        23,368
       Income from temperature-
        controlled distribution
        operations (D)                 1,854           6,831         6,831
       Income from ProLogis
        California LLC (E)             4,803           4,714         4,714
       Income from ProLogis
        European Properties Fund (F)   5,196           3,249         3,249
       Income from ProLogis
        European Properties
        S.a.r.l. (G)                     294           2,774         2,774
       Income from ProLogis North
        American Properties
        Fund I (H)                     2,051              --            --
       Income from ProLogis North
        American Properties
        Fund II (I)                      358              --            --
       Income from service
        companies (J)                  2,188              --            --
       Interest and other income       1,458           1,873         2,224
                                     180,820         165,718       164,979
     Expenses:
       Rental expenses, net of
        recoveries (K)                 6,758           6,547         6,547
       General and administrative     14,827          11,241        12,904
       Depreciation of non-real
        estate assets                  1,613             746           902
       Interest (L)                   39,382          41,986        39,612
       Other                           4,727           1,335         1,081
                                      67,307          61,855        61,046
 
     Funds from operations           113,513         103,863       103,933
     Less preferred share dividends   11,432          14,405        14,405
     Less minority interest share
      in funds from operations         1,376           1,654         1,724
     Funds from Operations
      Attributable to
      Common Shares                 $100,705         $87,804       $87,804
     Weighted average Common Shares
      outstanding - basic            167,297         162,124       162,124
     Weighted average Common Shares
      outstanding - diluted (M)      179,459         176,836       176,836
     Per Share Funds from Operations
      Attributable to Common Shares:
       Basic                           $0.60           $0.54         $0.54
       Diluted (M)                     $0.57           $0.52         $0.52
 
 
     In 2000, ProLogis reported the results of operations of ProLogis Kingspark
 under the equity method.  In 2001, ProLogis Kingspark's results of operations
 have been consolidated in ProLogis' Statement of Funds from Operations.  For
 comparative purposes, proforma information for the three months ended March
 31, 2000 assuming that ProLogis Kingspark was consolidated for that period is
 presented.
 
 
                                 ProLogis Trust
 
                               First Quarter 2001
                          Unaudited Financial Results
 
           Notes to Consolidated Statements of Funds from Operations
 
     NOTES
 
     (A)  See Reconciliation of Net Earnings to Funds from Operations.
 
     (B)  Includes straight-lined rents of $1,649,000 and $1,921,000 for the
          three months in 2001 and 2000, respectively.
 
     (C)  Income does not include deferred gains of $14,732,000 and $647,000
          for the three months in 2001 and 2000, respectively.  In 2001, these
          amounts represent the portions of the gains related to the facilities
          that ProLogis sold to distribution real estate entities that do not
          qualify for income recognition by ProLogis due to ProLogis'
          continuing ownership in these entities.  In 2000, amounts also
          include gains related to facilities sold by ProLogis Kingspark.
 
     (D)  Represents ProLogis' share of the funds from operations of its
          temperature-controlled distribution operations companies that are
          accounted for under the equity method.
 
     (E)  Represents ProLogis' share of the funds from operations of ProLogis
          California LLC recognized under the equity method.  Additionally,
          includes management, leasing and development fees of $666,000 and
          $665,000 for the three months in 2001 and 2000, respectively, earned
          by ProLogis.
 
     (F)  Represents ProLogis' share of the funds from operations of ProLogis
          European Properties Fund recognized under the equity method.
          Additionally, includes management fees of $1,722,000 and $1,142,000
          for the three months in 2001 and 2000, respectively, earned by
          ProLogis.
 
     (G)  On January 7, 2000, ProLogis contributed 50.1% of the common stock
          of this entity to ProLogis European Properties Fund.  On January 7,
          2001, ProLogis contributed the remaining 49.9% of the common stock of
          this entity to ProLogis European Properties Fund.  As of March 31,
          2001, ProLogis European Properties Fund, in which ProLogis has a
          41.8% ownership interest at that date, owned 100% of ProLogis
          European Properties S.a.r.l.  Under the equity method, ProLogis
          recognized its 49.9% share of the funds from operations of ProLogis
          European Properties S.a.r.l in 2000 for the period from January 7,
          2000 to March 31, 2000 and, in 2001 for the period from January 1,
          2001 to January 6, 2001.  Prior to January 7, 2000, ProLogis European
          Properties S.a.r.l. was consolidated in ProLogis' Statement of Funds
          from Operations.
 
     (H)  Represents ProLogis' share of the funds from operations of ProLogis
          North American Properties Fund I recognized under the equity method.
          This entity was formed on June 30, 2000.  Additionally, includes
          management and leasing fees of $512,000 earned by ProLogis.
 
     (I)  On March 27, 2001, First Islamic Investment Bank E. C. acquired the
          80% interest in ProLogis Iowa LLC ("ProLogis Principal") from
          Principal Financial Group.  Also on that date, this entity, under the
          name ProLogis First US Properties LP ("ProLogis North American
          Properties Fund II"), acquired 24 operating facilities from ProLogis.
          For the three months in 2001, represents ProLogis' share of the funds
          from operations of ProLogis Principal and ProLogis North American
          Properties Fund II recognized under the equity method.  Additionally,
          includes management and leasing fees of $45,000 earned by ProLogis.
          ProLogis Principal was formed on June 30, 2000.
 
     (J)  Consists of license fee income for the non-exclusive use of the
          ProLogis Operating System (TM) under license agreements entered into
          in the second quarter of 2000 ($1,521,000 from Vizional Technologies,
          Inc. and $667,000 from PhatPipe, Inc.).
 
     (K)  Amounts are net of rental expense recoveries of $24,868,000 and
          $23,162,000 for the three months in 2001 and 2000, respectively.
 
     (L)  Includes amortization of loan fees of $1,222,000 and $987,000 for the
          three months in 2001 and 2000, respectively.  Excludes interest that
          has been capitalized of $8,069,000 and $4,183,000 for the three
          months in 2001 and 2000, respectively.
 
     (M)  Funds from operations per Common Share calculated on a "diluted"
          basis is as follows (in thousands, except per share amounts):
 
 
                                                         Three Months Ended
                                                              March 31,
                                                         2001           2000
 
       Funds from operations attributable
        to Common Shares                             $100,705        $87,804
       Minority interest share in
        funds from operations                           1,376          1,654
       Series B preferred share dividends                  81          3,053
       Adjusted funds from operations
        attributable to Common Shares                $102,162        $92,511
       Weighted average Common Shares outstanding     167,297        162,124
       Weighted average conversion of
        limited partnership units                       5,088          5,587
       Weighted average conversion of
        Series B preferred shares (a)                   6,263          8,968
       Incremental common stock equivalents
        and contingent shares (b)                         811            157
       Adjusted weighted average Common
        Shares outstanding                            179,459        176,836
       Diluted funds from operations per
        Common Share                                    $0.57          $0.52
 
     (a)  ProLogis called for the redemption of its Series B Convertible
          Preferred Shares as of March 20, 2001.  Prior to the redemption date,
          5,908,971 Series B Convertible Preferred Shares were converted into
          7,575,301 Common Shares.  The remaining 183,302 Series B Convertible
          Preferred Shares outstanding on March 20, 2001 were redeemed at a
          price of $25.442 per share ($25.00 liquidation preference and
          $0.442 of accrued dividends).
 
     (b)  The number of weighted average common stock equivalents outstanding
          were 8,904,000 and 7,770,000 for the three months in 2001 and 2000,
          respectively.
 
 
                                 ProLogis Trust
 
                               First Quarter 2001
                          Unaudited Financial Results
 
                    Consolidated Statements of Earnings (A)
                    (in thousands, except per share amounts)
 
                                                         Three Months Ended
                                                              March 31,
                                                         2001           2000
 
     Revenues:
       Rental income (B)                             $119,764       $120,809
       Corporate distribution facilities
        services income (C)                            42,854         23,764
       Income (loss) from temperature-controlled
        distribution operations (D)                    (9,471)         1,197
       Income from ProLogis California LLC (E)          3,067          3,099
       Income from ProLogis European
        Properties Fund (E)                               454          7,324
       Income from ProLogis European
        Properties S.a.r.l. (E)                            36          4,928
       Income from ProLogis North
        American Properties Fund I (E)                  1,352             --
       Income from ProLogis North
        American Properties Fund II (E)                   341             --
       Income from service companies (F)                2,188             --
       Interest and other income                        1,458          1,873
                                                      162,043        162,994
 
     Expenses:
       Rental expenses, net of recoveries (G)           6,758          6,547
       General and administrative                      14,827         11,241
       Depreciation and amortization                   38,752         39,474
       Interest (H)                                    39,382         41,986
       Other                                            1,307          1,335
                                                      101,026        100,583
     Earnings from operations                          61,017         62,411
     Minority interest share in earnings                1,376          1,654
     Earnings before gain (loss) on disposition
      of non-CDFS business segment assets and
      foreign currency exchange losses                 59,641         60,757
     Gain (loss) on disposition of non-CDFS
      business segment assets, net (I)                 (1,198)         5,108
     Foreign currency exchange losses, net (J)         (3,004)        (6,522)
     Net earnings                                      55,439         59,343
     Less preferred share dividends                    11,432         14,405
     Net Earnings Attributable to Common Shares       $44,007        $44,938
     Weighted average Common Shares
      outstanding - basic                             167,297        162,124
     Weighted average Common Shares
      outstanding - diluted (K)                       174,371        162,281
     Per Share Net Earnings Attributable
      to Common Shares:
       Basic                                            $0.26          $0.28
       Diluted (K)                                      $0.25          $0.28
 
     NOTES
 
     (A)  See Reconciliation of Net Earnings to Funds from Operations.  In
          2000, ProLogis reported the results of operations of ProLogis
          Kingspark under the equity method.  In 2001, ProLogis Kingspark's
          results of operations have been consolidated in ProLogis' Statement
          of Earnings.
 
     (B)  Includes straight-lined rents of $1,649,000 and $1,921,000 for the
          three months in 2001 and 2000, respectively.
 
     (C)  Income does not include deferred gains of $14,732,000 and $647,000
          for the three months in 2001 and 2000, respectively.  In 2001, these
          amounts represent the portions of the gains related to the facilities
          that ProLogis sold to distribution real estate entities that do not
          qualify for income recognition by ProLogis due to ProLogis'
          continuing ownership in these entities.  In 2000, amounts also
          include gains related to facilities sold by ProLogis Kingspark.
 
     (D)  Represents ProLogis' share of the income or loss of its investment in
          temperature-controlled distribution operations companies recognized
          under the equity method.
 
     (E)  Represents ProLogis' share of the income of each entity recognized
          under the equity method.  See also Notes to Consolidated Statements
          of Funds from Operation.
 
     (F)  Consists of license fee income for the non-exclusive use of the
          ProLogis Operating System(TM) under license agreements entered into
          in the second quarter of 2000 ($1,521,000 from Vizional Technologies,
          Inc. and $667,000 from PhatPipe, Inc.).
 
     (G)  Amounts are net of rental expense recoveries of $24,868,000 and
          $23,162,000 for the three months in 2001 and 2000, respectively.
 
     (H)  Includes amortization of loan fees of $1,222,000 and $987,000 for the
          three months in 2001 and 2000, respectively.  Excludes interest that
          has been capitalized of $8,069,000 and $4,183,000 for the three
          months in 2001 and 2000, respectively.
 
     (I)  Does not include deferred gains of $9,868,000 and $370,000 for the
          three months in 2001 and 2000, respectively, representing the
          portions of the gains related to the facilities that ProLogis sold to
          distribution real estate entities that do not qualify for income
          recognition by ProLogis due to ProLogis' continuing ownership in
          these entities.
 
     (J)  Includes foreign currency gains and losses resulting from
          intercompany debt transactions and from the remeasurement (based on
          current foreign currency exchange rates) of intercompany and other
          debt of ProLogis' foreign subsidiaries.  Also includes foreign
          currency gains and losses resulting from mark to market adjustments
          related to derivative financial instruments. Such gains and losses
          are not included for purposes of calculating funds from operations.
 
     (K)  Net earnings per Common Share on a diluted basis does not assume
          conversion of limited partnership units as the effect is anti-
          dilutive for both periods presented.  For the three months in 2000,
          net earnings per Common Share on a diluted basis does not assume
          conversion of Series B Convertible Preferred Shares as the effect is
          anti-dilutive.
 
 
                                 ProLogis Trust
 
                               First Quarter 2001
                          Unaudited Financial Results
 
          Reconciliation of Net Earnings to Funds from Operations (A)
                                 (in thousands)
 
                                                         Three Months Ended
                                                              March 31,
                                                         2001           2000
 
     Net Earnings Attributable to Common Shares       $44,007        $44,938
 
     Add (Deduct):
       Real estate related depreciation
        and amortization                               37,139         38,728
       (Gain) loss on the disposition of
        non-CDFS business segment assets                1,198         (5,108)
       Foreign currency exchange losses, net (B)        3,004          6,522
       Deferred income tax benefit                     (3,420)           --
 
       ProLogis' share of reconciling items
        from unconsolidated entities (C):
         Real estate related depreciation
          and amortization                             17,380         14,239
         Gain on the disposition of
          non-CDFS business segment assets                 (5)          (312)
         Foreign currency exchange (gains)
          losses, net (B)                               3,001        (10,637)
         Deferred income tax benefit                   (1,599)          (566)
 
     Funds from Operations Attributable
      to Common Shares                               $100,705        $87,804
 
     NOTES
 
     (A)  ProLogis considers funds from operations to be a useful measure of
          comparative period operating performance.  Funds from operations as
          used by ProLogis is defined as net income (computed in accordance
          with GAAP) excluding: (i) real estate related depreciation and
          amortization; (ii) gains or losses from the disposition of non-CDFS
          business segment assets; (iii) deferred income tax benefits and
          expenses of ProLogis' taxable subsidiaries; (iv) foreign currency
          exchange gains and losses resulting from debt transactions between
          ProLogis and its foreign consolidated and unconsolidated entities;
          (v) foreign currency exchange gains and losses from the remeasurement
          (based on current foreign currency exchange rates) of third party
          debt of ProLogis' foreign consolidated and unconsolidated entities;
          and (vi) mark to market adjustments related to derivative financial
          instruments utilized to manage ProLogis' foreign currency risks.  In
          addition, adjustments for ProLogis' unconsolidated entities are
          calculated to reflect each entity's funds from operations on the same
          basis as ProLogis.
 
     (B)  See Note J on Consolidated Statements of Earnings.
 
     (C)  ProLogis accounts for its investment in certain of its distribution
          real estate entities and in its temperature-controlled distribution
          companies under the equity method.  For purposes of calculating funds
          from operations, ProLogis adjusts the net earnings of these entities
          on the same basis as the definition discussed in Note A.
 
 
                                 ProLogis Trust
 
                               First Quarter 2001
                          Unaudited Financial Results
 
                        Consolidated Balance Sheets (A)
                                 (in thousands)
 
                                                                   Proforma
                                   March 31,      December 31,   December 31,
                                      2001            2000           2000
 
     Assets:
     Investments in distribution
      properties:
       Buildings, improvements,
        improved land and CIP     $4,543,282      $4,502,087    $4,729,805
       Land held for development     323,520         187,405       299,041
       Less accumulated
        depreciation                (505,890)       (476,982)     (476,982)
       Net investments in
        distribution properties    4,360,912       4,212,510     4,551,864
 
     Investments in unconsolidated
      entities:
       Investment in distribution
        real estate entities (A)     471,580         959,307       462,756
       Investment in temperature-
        controlled distribution
        operating companies          350,480         423,034       423,034
       Investment in service
        companies                     40,907          35,810        35,810
       Total investments in
        unconsolidated entities      862,967       1,418,151       921,600
 
     Cash and cash equivalents        39,322          57,870       147,658
     Accounts and notes receivable    65,304          50,856        92,086
     Other assets                    246,108         171,950       245,128
 
         Total assets             $5,574,613      $5,911,337    $5,958,336
 
     Liabilities and Shareholders' Equity:
     Liabilities:
       Lines of credit              $120,210        $439,822      $439,822
       Senior unsecured notes      1,700,086       1,699,989     1,699,989
       Mortgage notes and other
        secured debt                 536,172         537,925       537,925
       Construction payable           22,588          40,925        54,175
       Interest payable               46,576          39,275        39,275
       Distributions and
        dividends payable                729          57,739        57,739
       Accounts payable               17,203          12,560        30,490
       Accrued expenses and
        other liabilities            144,680         109,101       123,041
         Total liabilities         2,588,244       2,937,336     2,982,456
 
     Minority interest                46,456          46,630        48,509
 
     Shareholders' equity:
       Series A preferred shares     135,000         135,000       135,000
       Series B convertible
        preferred shares                  --         156,403       156,403
       Series C preferred shares     100,000         100,000       100,000
       Series D preferred shares     250,000         250,000       250,000
       Series E preferred shares      50,000          50,000        50,000
       Common Shares at $.01
        par value                      1,737           1,653         1,653
       Additional paid-in capital  2,889,265       2,721,580     2,721,580
       Accumulated other
        comprehensive income         (76,452)        (33,768)      (33,768)
       Distributions in excess
        of net earnings             (409,637)       (453,497)     (453,497)
         Total shareholders'
          equity                   2,939,913       2,927,371     2,927,371
 
         Total liabilities and
          shareholders' equity    $5,574,613      $5,911,337    $5,958,336
 
     NOTE
 
     (A)  In 2001, ProLogis Kingspark is included on a consolidated basis.  In
          2000, ProLogis accounted for ProLogis Kingspark under the equity
          method.  For comparative purposes, proforma information is presented
          for December 31, 2000 assuming that ProLogis Kingspark was
          consolidated as of that date.
 
                     MAKE YOUR OPINION COUNT -  Click Here
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SOURCE ProLogis
    DENVER, April 25 /PRNewswire/ -- ProLogis (NYSE:   PLD), a leading global
 provider of distribution services and facilities, reported a 9.6% increase in
 funds from operations (FFO) per diluted share for the quarter ended March 31,
 2001, to $.57 per diluted share, from $.52 per diluted share in 2000.
     (Photo:  http://www.newscom.com/cgi-bin/prnh/19990420/PROLOGIS )
     "Our solid first quarter results were driven by the strong performance of
 our operating properties, with rental rate growth of 20.2% and same store net
 operating income growth of 3.9%.  In addition, our Corporate Distribution
 Facilities business outperformed while our temperature-controlled operations
 met our expectations," said K. Dane Brooksher, chairman and chief executive
 officer.  "We also formed our second ProLogis North American Properties Fund,
 which will increase return on invested capital while providing the capital
 necessary to serve our customers' needs for new distribution facilities."
     "In addition, we strengthened our balance sheet during the first quarter
 with the redemption of our Series B Convertible Preferred Shares and a
 reduction in borrowings under our revolving lines of credit, significantly
 improving both our interest coverage and fixed coverage ratios.  We are also
 in the final stages of completing the first ever pan-European commercial
 mortgage-backed securities offering in Europe to provide permanent financing
 within the ProLogis European Properties Fund.  The issue, which is rated
 Aaa/AAA by Moody's and S&P, raised over 212 million euros at a spread of 35 to
 37 basis points over Euribor," Mr. Brooksher added.
     "While we are cautious in our outlook for the remainder of the year, we
 are well positioned during this time of economic uncertainty due to the
 strength of our customer relationships, the geographic breadth of our
 operating portfolio, our leading positions in key global logistics markets,
 our ability to self-fund operations and our financial strength," Mr. Brooksher
 added.
 
     Distribution Efficiencies Drive Corporate Distribution Facilities Business
 
     "We continue to experience demand for new space in key North American
 logistics markets as customers look for ways to reduce their distribution
 costs," said Irving F. Lyons, III, president and chief investment officer.
 North American build-to-suit leases signed in the first quarter include
 facilities for Procter & Gamble and Sears Logistics.  "In Europe,
 reconfiguration of distribution networks related to European unification
 continues to be a major driver of demand.  In the first quarter, we signed
 over 1.9 million square feet of pre-leased development agreements in Europe,
 including new facilities for Samsung in the Netherlands and Schneider Electric
 in Spain and Exel on behalf of Safeway in the U.K."
 
     Property Funds Enhance Returns and Fund Development Pipeline
 
     "Our development pipeline is funded from both dispositions of non-core
 assets and contributions of recent developments into our property funds, which
 totaled $393 million in the first quarter," said Mr. Lyons.  "Through our
 unique fund structure, we ensure a predictable source of funding for our
 development business, eliminating the need for us to access the public capital
 markets thereby diluting shareholders.  In addition, because we reinvest our
 development gains back into our stabilized property funds, we earn an
 attractive current return on our capital, and can also earn incentive returns
 based upon future performance."  During the quarter, the company formed
 ProLogis North American Properties Fund II with a contribution of $232 million
 in properties.  ProLogis will retain an ownership in the Fund of not less than
 20%.
 
     ProLogis is a leading global provider of integrated distribution
 facilities and services, with 1,700 distribution facilities owned, operating
 and under development throughout North America and Europe.  ProLogis has built
 the industry's first and only global network of distribution facilities with
 the primary objective to build shareholder value by becoming the leading
 provider of distribution services.  The company expects to achieve this
 objective through the ProLogis Operating System(TM) and its commitment to be
 'The Global Distribution Solution' by providing exceptional corporate
 distribution services and facilities to meet customer expansion and
 reconfiguration needs globally.  As of March 31, 2001, ProLogis owned, managed
 or had under development a total of 196.9 million square feet (18.3 million
 Sq. Meters) of distribution facilities, in 98 global markets.
 
     In addition to historical information, this press release contains
 forward-looking statements under the federal securities laws.  These
 statements are based on current expectations, estimates and projections about
 the industry and markets in which ProLogis operates, management's beliefs and
 assumptions made by management.  Forward-looking statements are not guarantees
 of future performance and involve certain risks and uncertainties which are
 difficult to predict.  Actual operating results may be affected by changes in
 national and local economic conditions, competitive market conditions, changes
 in financial markets or interest rates that could adversely affect ProLogis'
 ability to meet its financing needs and obligations, weather, obtaining
 governmental approvals and meeting development schedules, and therefore, may
 differ materially from what is expressed or forecasted in this press release.
 
     A copy of ProLogis' first quarter 2001 supplemental information will be
 available from the company's web site at http://www.prologis.com or by request
 at 800/820-0181.  The company's conference call will be available via a live
 webcast on the company's website at www.prologis.com at 10:00 EDT on Thursday,
 April 26, 2001.  The replay of the call will be available on the company's web
 site or at www.streetfusion.com or at www.streetevents.com.
 
 
                                 ProLogis Trust
 
                               First Quarter 2001
                          Unaudited Financial Results
 
              Consolidated Statements of Funds from Operations (A)
                    (in thousands, except per share amounts)
 
                                                                   ProForma
                                                                 Three Months
                                        Three Months Ended          Ended
                                            March 31,             March 31,
                                       2001           2000           2000
     Revenues:
       Rental income (B)            $119,764        $120,809      $121,819
       Corporate distribution
        facilities services
        income (C)                    42,854          25,468        23,368
       Income from temperature-
        controlled distribution
        operations (D)                 1,854           6,831         6,831
       Income from ProLogis
        California LLC (E)             4,803           4,714         4,714
       Income from ProLogis
        European Properties Fund (F)   5,196           3,249         3,249
       Income from ProLogis
        European Properties
        S.a.r.l. (G)                     294           2,774         2,774
       Income from ProLogis North
        American Properties
        Fund I (H)                     2,051              --            --
       Income from ProLogis North
        American Properties
        Fund II (I)                      358              --            --
       Income from service
        companies (J)                  2,188              --            --
       Interest and other income       1,458           1,873         2,224
                                     180,820         165,718       164,979
     Expenses:
       Rental expenses, net of
        recoveries (K)                 6,758           6,547         6,547
       General and administrative     14,827          11,241        12,904
       Depreciation of non-real
        estate assets                  1,613             746           902
       Interest (L)                   39,382          41,986        39,612
       Other                           4,727           1,335         1,081
                                      67,307          61,855        61,046
 
     Funds from operations           113,513         103,863       103,933
     Less preferred share dividends   11,432          14,405        14,405
     Less minority interest share
      in funds from operations         1,376           1,654         1,724
     Funds from Operations
      Attributable to
      Common Shares                 $100,705         $87,804       $87,804
     Weighted average Common Shares
      outstanding - basic            167,297         162,124       162,124
     Weighted average Common Shares
      outstanding - diluted (M)      179,459         176,836       176,836
     Per Share Funds from Operations
      Attributable to Common Shares:
       Basic                           $0.60           $0.54         $0.54
       Diluted (M)                     $0.57           $0.52         $0.52
 
 
     In 2000, ProLogis reported the results of operations of ProLogis Kingspark
 under the equity method.  In 2001, ProLogis Kingspark's results of operations
 have been consolidated in ProLogis' Statement of Funds from Operations.  For
 comparative purposes, proforma information for the three months ended March
 31, 2000 assuming that ProLogis Kingspark was consolidated for that period is
 presented.
 
 
                                 ProLogis Trust
 
                               First Quarter 2001
                          Unaudited Financial Results
 
           Notes to Consolidated Statements of Funds from Operations
 
     NOTES
 
     (A)  See Reconciliation of Net Earnings to Funds from Operations.
 
     (B)  Includes straight-lined rents of $1,649,000 and $1,921,000 for the
          three months in 2001 and 2000, respectively.
 
     (C)  Income does not include deferred gains of $14,732,000 and $647,000
          for the three months in 2001 and 2000, respectively.  In 2001, these
          amounts represent the portions of the gains related to the facilities
          that ProLogis sold to distribution real estate entities that do not
          qualify for income recognition by ProLogis due to ProLogis'
          continuing ownership in these entities.  In 2000, amounts also
          include gains related to facilities sold by ProLogis Kingspark.
 
     (D)  Represents ProLogis' share of the funds from operations of its
          temperature-controlled distribution operations companies that are
          accounted for under the equity method.
 
     (E)  Represents ProLogis' share of the funds from operations of ProLogis
          California LLC recognized under the equity method.  Additionally,
          includes management, leasing and development fees of $666,000 and
          $665,000 for the three months in 2001 and 2000, respectively, earned
          by ProLogis.
 
     (F)  Represents ProLogis' share of the funds from operations of ProLogis
          European Properties Fund recognized under the equity method.
          Additionally, includes management fees of $1,722,000 and $1,142,000
          for the three months in 2001 and 2000, respectively, earned by
          ProLogis.
 
     (G)  On January 7, 2000, ProLogis contributed 50.1% of the common stock
          of this entity to ProLogis European Properties Fund.  On January 7,
          2001, ProLogis contributed the remaining 49.9% of the common stock of
          this entity to ProLogis European Properties Fund.  As of March 31,
          2001, ProLogis European Properties Fund, in which ProLogis has a
          41.8% ownership interest at that date, owned 100% of ProLogis
          European Properties S.a.r.l.  Under the equity method, ProLogis
          recognized its 49.9% share of the funds from operations of ProLogis
          European Properties S.a.r.l in 2000 for the period from January 7,
          2000 to March 31, 2000 and, in 2001 for the period from January 1,
          2001 to January 6, 2001.  Prior to January 7, 2000, ProLogis European
          Properties S.a.r.l. was consolidated in ProLogis' Statement of Funds
          from Operations.
 
     (H)  Represents ProLogis' share of the funds from operations of ProLogis
          North American Properties Fund I recognized under the equity method.
          This entity was formed on June 30, 2000.  Additionally, includes
          management and leasing fees of $512,000 earned by ProLogis.
 
     (I)  On March 27, 2001, First Islamic Investment Bank E. C. acquired the
          80% interest in ProLogis Iowa LLC ("ProLogis Principal") from
          Principal Financial Group.  Also on that date, this entity, under the
          name ProLogis First US Properties LP ("ProLogis North American
          Properties Fund II"), acquired 24 operating facilities from ProLogis.
          For the three months in 2001, represents ProLogis' share of the funds
          from operations of ProLogis Principal and ProLogis North American
          Properties Fund II recognized under the equity method.  Additionally,
          includes management and leasing fees of $45,000 earned by ProLogis.
          ProLogis Principal was formed on June 30, 2000.
 
     (J)  Consists of license fee income for the non-exclusive use of the
          ProLogis Operating System (TM) under license agreements entered into
          in the second quarter of 2000 ($1,521,000 from Vizional Technologies,
          Inc. and $667,000 from PhatPipe, Inc.).
 
     (K)  Amounts are net of rental expense recoveries of $24,868,000 and
          $23,162,000 for the three months in 2001 and 2000, respectively.
 
     (L)  Includes amortization of loan fees of $1,222,000 and $987,000 for the
          three months in 2001 and 2000, respectively.  Excludes interest that
          has been capitalized of $8,069,000 and $4,183,000 for the three
          months in 2001 and 2000, respectively.
 
     (M)  Funds from operations per Common Share calculated on a "diluted"
          basis is as follows (in thousands, except per share amounts):
 
 
                                                         Three Months Ended
                                                              March 31,
                                                         2001           2000
 
       Funds from operations attributable
        to Common Shares                             $100,705        $87,804
       Minority interest share in
        funds from operations                           1,376          1,654
       Series B preferred share dividends                  81          3,053
       Adjusted funds from operations
        attributable to Common Shares                $102,162        $92,511
       Weighted average Common Shares outstanding     167,297        162,124
       Weighted average conversion of
        limited partnership units                       5,088          5,587
       Weighted average conversion of
        Series B preferred shares (a)                   6,263          8,968
       Incremental common stock equivalents
        and contingent shares (b)                         811            157
       Adjusted weighted average Common
        Shares outstanding                            179,459        176,836
       Diluted funds from operations per
        Common Share                                    $0.57          $0.52
 
     (a)  ProLogis called for the redemption of its Series B Convertible
          Preferred Shares as of March 20, 2001.  Prior to the redemption date,
          5,908,971 Series B Convertible Preferred Shares were converted into
          7,575,301 Common Shares.  The remaining 183,302 Series B Convertible
          Preferred Shares outstanding on March 20, 2001 were redeemed at a
          price of $25.442 per share ($25.00 liquidation preference and
          $0.442 of accrued dividends).
 
     (b)  The number of weighted average common stock equivalents outstanding
          were 8,904,000 and 7,770,000 for the three months in 2001 and 2000,
          respectively.
 
 
                                 ProLogis Trust
 
                               First Quarter 2001
                          Unaudited Financial Results
 
                    Consolidated Statements of Earnings (A)
                    (in thousands, except per share amounts)
 
                                                         Three Months Ended
                                                              March 31,
                                                         2001           2000
 
     Revenues:
       Rental income (B)                             $119,764       $120,809
       Corporate distribution facilities
        services income (C)                            42,854         23,764
       Income (loss) from temperature-controlled
        distribution operations (D)                    (9,471)         1,197
       Income from ProLogis California LLC (E)          3,067          3,099
       Income from ProLogis European
        Properties Fund (E)                               454          7,324
       Income from ProLogis European
        Properties S.a.r.l. (E)                            36          4,928
       Income from ProLogis North
        American Properties Fund I (E)                  1,352             --
       Income from ProLogis North
        American Properties Fund II (E)                   341             --
       Income from service companies (F)                2,188             --
       Interest and other income                        1,458          1,873
                                                      162,043        162,994
 
     Expenses:
       Rental expenses, net of recoveries (G)           6,758          6,547
       General and administrative                      14,827         11,241
       Depreciation and amortization                   38,752         39,474
       Interest (H)                                    39,382         41,986
       Other                                            1,307          1,335
                                                      101,026        100,583
     Earnings from operations                          61,017         62,411
     Minority interest share in earnings                1,376          1,654
     Earnings before gain (loss) on disposition
      of non-CDFS business segment assets and
      foreign currency exchange losses                 59,641         60,757
     Gain (loss) on disposition of non-CDFS
      business segment assets, net (I)                 (1,198)         5,108
     Foreign currency exchange losses, net (J)         (3,004)        (6,522)
     Net earnings                                      55,439         59,343
     Less preferred share dividends                    11,432         14,405
     Net Earnings Attributable to Common Shares       $44,007        $44,938
     Weighted average Common Shares
      outstanding - basic                             167,297        162,124
     Weighted average Common Shares
      outstanding - diluted (K)                       174,371        162,281
     Per Share Net Earnings Attributable
      to Common Shares:
       Basic                                            $0.26          $0.28
       Diluted (K)                                      $0.25          $0.28
 
     NOTES
 
     (A)  See Reconciliation of Net Earnings to Funds from Operations.  In
          2000, ProLogis reported the results of operations of ProLogis
          Kingspark under the equity method.  In 2001, ProLogis Kingspark's
          results of operations have been consolidated in ProLogis' Statement
          of Earnings.
 
     (B)  Includes straight-lined rents of $1,649,000 and $1,921,000 for the
          three months in 2001 and 2000, respectively.
 
     (C)  Income does not include deferred gains of $14,732,000 and $647,000
          for the three months in 2001 and 2000, respectively.  In 2001, these
          amounts represent the portions of the gains related to the facilities
          that ProLogis sold to distribution real estate entities that do not
          qualify for income recognition by ProLogis due to ProLogis'
          continuing ownership in these entities.  In 2000, amounts also
          include gains related to facilities sold by ProLogis Kingspark.
 
     (D)  Represents ProLogis' share of the income or loss of its investment in
          temperature-controlled distribution operations companies recognized
          under the equity method.
 
     (E)  Represents ProLogis' share of the income of each entity recognized
          under the equity method.  See also Notes to Consolidated Statements
          of Funds from Operation.
 
     (F)  Consists of license fee income for the non-exclusive use of the
          ProLogis Operating System(TM) under license agreements entered into
          in the second quarter of 2000 ($1,521,000 from Vizional Technologies,
          Inc. and $667,000 from PhatPipe, Inc.).
 
     (G)  Amounts are net of rental expense recoveries of $24,868,000 and
          $23,162,000 for the three months in 2001 and 2000, respectively.
 
     (H)  Includes amortization of loan fees of $1,222,000 and $987,000 for the
          three months in 2001 and 2000, respectively.  Excludes interest that
          has been capitalized of $8,069,000 and $4,183,000 for the three
          months in 2001 and 2000, respectively.
 
     (I)  Does not include deferred gains of $9,868,000 and $370,000 for the
          three months in 2001 and 2000, respectively, representing the
          portions of the gains related to the facilities that ProLogis sold to
          distribution real estate entities that do not qualify for income
          recognition by ProLogis due to ProLogis' continuing ownership in
          these entities.
 
     (J)  Includes foreign currency gains and losses resulting from
          intercompany debt transactions and from the remeasurement (based on
          current foreign currency exchange rates) of intercompany and other
          debt of ProLogis' foreign subsidiaries.  Also includes foreign
          currency gains and losses resulting from mark to market adjustments
          related to derivative financial instruments. Such gains and losses
          are not included for purposes of calculating funds from operations.
 
     (K)  Net earnings per Common Share on a diluted basis does not assume
          conversion of limited partnership units as the effect is anti-
          dilutive for both periods presented.  For the three months in 2000,
          net earnings per Common Share on a diluted basis does not assume
          conversion of Series B Convertible Preferred Shares as the effect is
          anti-dilutive.
 
 
                                 ProLogis Trust
 
                               First Quarter 2001
                          Unaudited Financial Results
 
          Reconciliation of Net Earnings to Funds from Operations (A)
                                 (in thousands)
 
                                                         Three Months Ended
                                                              March 31,
                                                         2001           2000
 
     Net Earnings Attributable to Common Shares       $44,007        $44,938
 
     Add (Deduct):
       Real estate related depreciation
        and amortization                               37,139         38,728
       (Gain) loss on the disposition of
        non-CDFS business segment assets                1,198         (5,108)
       Foreign currency exchange losses, net (B)        3,004          6,522
       Deferred income tax benefit                     (3,420)           --
 
       ProLogis' share of reconciling items
        from unconsolidated entities (C):
         Real estate related depreciation
          and amortization                             17,380         14,239
         Gain on the disposition of
          non-CDFS business segment assets                 (5)          (312)
         Foreign currency exchange (gains)
          losses, net (B)                               3,001        (10,637)
         Deferred income tax benefit                   (1,599)          (566)
 
     Funds from Operations Attributable
      to Common Shares                               $100,705        $87,804
 
     NOTES
 
     (A)  ProLogis considers funds from operations to be a useful measure of
          comparative period operating performance.  Funds from operations as
          used by ProLogis is defined as net income (computed in accordance
          with GAAP) excluding: (i) real estate related depreciation and
          amortization; (ii) gains or losses from the disposition of non-CDFS
          business segment assets; (iii) deferred income tax benefits and
          expenses of ProLogis' taxable subsidiaries; (iv) foreign currency
          exchange gains and losses resulting from debt transactions between
          ProLogis and its foreign consolidated and unconsolidated entities;
          (v) foreign currency exchange gains and losses from the remeasurement
          (based on current foreign currency exchange rates) of third party
          debt of ProLogis' foreign consolidated and unconsolidated entities;
          and (vi) mark to market adjustments related to derivative financial
          instruments utilized to manage ProLogis' foreign currency risks.  In
          addition, adjustments for ProLogis' unconsolidated entities are
          calculated to reflect each entity's funds from operations on the same
          basis as ProLogis.
 
     (B)  See Note J on Consolidated Statements of Earnings.
 
     (C)  ProLogis accounts for its investment in certain of its distribution
          real estate entities and in its temperature-controlled distribution
          companies under the equity method.  For purposes of calculating funds
          from operations, ProLogis adjusts the net earnings of these entities
          on the same basis as the definition discussed in Note A.
 
 
                                 ProLogis Trust
 
                               First Quarter 2001
                          Unaudited Financial Results
 
                        Consolidated Balance Sheets (A)
                                 (in thousands)
 
                                                                   Proforma
                                   March 31,      December 31,   December 31,
                                      2001            2000           2000
 
     Assets:
     Investments in distribution
      properties:
       Buildings, improvements,
        improved land and CIP     $4,543,282      $4,502,087    $4,729,805
       Land held for development     323,520         187,405       299,041
       Less accumulated
        depreciation                (505,890)       (476,982)     (476,982)
       Net investments in
        distribution properties    4,360,912       4,212,510     4,551,864
 
     Investments in unconsolidated
      entities:
       Investment in distribution
        real estate entities (A)     471,580         959,307       462,756
       Investment in temperature-
        controlled distribution
        operating companies          350,480         423,034       423,034
       Investment in service
        companies                     40,907          35,810        35,810
       Total investments in
        unconsolidated entities      862,967       1,418,151       921,600
 
     Cash and cash equivalents        39,322          57,870       147,658
     Accounts and notes receivable    65,304          50,856        92,086
     Other assets                    246,108         171,950       245,128
 
         Total assets             $5,574,613      $5,911,337    $5,958,336
 
     Liabilities and Shareholders' Equity:
     Liabilities:
       Lines of credit              $120,210        $439,822      $439,822
       Senior unsecured notes      1,700,086       1,699,989     1,699,989
       Mortgage notes and other
        secured debt                 536,172         537,925       537,925
       Construction payable           22,588          40,925        54,175
       Interest payable               46,576          39,275        39,275
       Distributions and
        dividends payable                729          57,739        57,739
       Accounts payable               17,203          12,560        30,490
       Accrued expenses and
        other liabilities            144,680         109,101       123,041
         Total liabilities         2,588,244       2,937,336     2,982,456
 
     Minority interest                46,456          46,630        48,509
 
     Shareholders' equity:
       Series A preferred shares     135,000         135,000       135,000
       Series B convertible
        preferred shares                  --         156,403       156,403
       Series C preferred shares     100,000         100,000       100,000
       Series D preferred shares     250,000         250,000       250,000
       Series E preferred shares      50,000          50,000        50,000
       Common Shares at $.01
        par value                      1,737           1,653         1,653
       Additional paid-in capital  2,889,265       2,721,580     2,721,580
       Accumulated other
        comprehensive income         (76,452)        (33,768)      (33,768)
       Distributions in excess
        of net earnings             (409,637)       (453,497)     (453,497)
         Total shareholders'
          equity                   2,939,913       2,927,371     2,927,371
 
         Total liabilities and
          shareholders' equity    $5,574,613      $5,911,337    $5,958,336
 
     NOTE
 
     (A)  In 2001, ProLogis Kingspark is included on a consolidated basis.  In
          2000, ProLogis accounted for ProLogis Kingspark under the equity
          method.  For comparative purposes, proforma information is presented
          for December 31, 2000 assuming that ProLogis Kingspark was
          consolidated as of that date.
 
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