NOTE 4. UNCONSOLIDATED ENTITIES

Summary of Investments

We have investments in entities through a variety of ventures. We co-invest in entities that own multiple properties with partners and investors and we provide asset and property management services to these entities, which we refer to as co-investment ventures. These entities may be consolidated or unconsolidated, depending on the structure, our partner’s participation and other rights and our level of control of the entity. This note details our investments in unconsolidated co-investment ventures, which are accounted for using the equity method of accounting. See Note 7 for more detail regarding our consolidated investments that are not wholly owned.

We also have other ventures, generally with one partner and that we do not manage, which we account for using the equity method. We refer to our investments in all entities accounted for using the equity method, both unconsolidated co-investment ventures and other ventures, collectively, as unconsolidated entities.

The following table summarizes our investments in and advances to our unconsolidated entities (in thousands):

	September 30,		December 31,
	2018		2017
Unconsolidated co-investment ventures	$	5,282,935	$	5,274,702
Other ventures		335,243		221,748
Total	$	5,618,178	$	5,496,450

Unconsolidated Co-Investment Ventures

The following table summarizes the Strategic Capital Revenues we recognized in the Consolidated Statements of Income related to our unconsolidated co-investment ventures (in thousands):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2018		2017		2018		2017
Recurring fees	$	58,946	$	52,684	$	171,508	$	140,357
Transactional fees		11,798		14,967		39,250		36,186
Promote revenues		-		-		68,218		127,092
Total strategic capital revenues from unconsolidated co-investment ventures	$	70,744	$	67,651	$	278,976	$	303,635

The following table summarizes the key property information, financial position and operating information of our unconsolidated co-investment ventures (not our proportionate share) and the amounts we recognized in the Consolidated Financial Statements related to our unconsolidated co-investment ventures (dollars and square feet in millions):

	U.S.						Other Americas						Europe						Asia						Total
As of:	Sep 30, 2018			Dec 31, 2017			Sep 30, 2018			Dec 31, 2017			Sep 30, 2018			Dec 31, 2017			Sep 30, 2018			Dec 31, 2017			Sep 30, 2018			Dec 31, 2017
Key property information
Ventures		1			1			2			2			3			3			2			2			8			8
Operating properties		556			552			205			205			664			707			121			95			1,546			1,559
Square feet		88			88			37			37			158			166			50			41			333			332

Financial position
Unconsolidated co-investment ventures:
Total assets ($) (1)		7,180			7,062			2,071			2,118			13,401			13,586			6,709			6,133			29,361			28,899
Third-party debt ($)		2,093			2,313			752			756			2,656			2,682			2,629			2,328			8,130			8,079
Total liabilities ($)		2,318			2,520			797			782			3,727			3,655			2,920			2,685			9,762			9,642

Our investment balance ($) (2)		1,358			1,383			559			555			2,797			2,813			569			524			5,283			5,275
Our weighted average ownership (3)		26.7	%		28.2	%		43.9	%		43.4	%		33.1	%		32.8	%		15.1	%		15.1	%		28.3	%		28.8	%

	U.S.						Other Americas						Europe						Asia						Total
Operating information	Sep 30, 2018			Sep 30, 2017			Sep 30, 2018			Sep 30, 2017			Sep 30, 2018			Sep 30, 2017			Sep 30, 2018			Sep 30, 2017			Sep 30, 2018			Sep 30, 2017
For the three months ended:
Unconsolidated co-investment ventures:
Total revenues ($)		168			160			54			60			272			266			117			95			611			581
Net earnings ($)		28			64			18			19			97			63			21			30			164			176

Our earnings from unconsolidated co-investment ventures, net ($)		8			18			7			6			37			24			4			5			56			53

For the nine months ended:
Unconsolidated co-investment ventures:
Total revenues ($)		504			369			162			190			832			758			339			272			1,837			1,589
Net earnings ($)		65			115			51			58			300			229			69			147			485			549

Our earnings from unconsolidated co-investment ventures, net ($)		20			25			21			22			111			90			13			23			165			160

(1)

In October 2018, we and certain unconsolidated co-investment ventures sold a portfolio of operating buildings and land in Europe and the U.S in a single transaction. Included in the total assets of our unconsolidated co-investment ventures is $402.0 million of real estate assets that met the criteria to be classified as assets held for sale.

(2)

Prologis’ investment balance is presented at our adjusted basis derived from the ventures’ U.S. GAAP information. The difference between our ownership interest of a venture’s equity and our investment balance at September 30, 2018 and December 31, 2017, results principally from three types of transactions: (i) deferred gains from the contribution of property to a venture prior to January 1, 2018 ($648.1 million and $667.3 million, respectively); (ii) recording additional costs associated with our investment in the venture ($91.4 million and $94.2 million, respectively); and (iii) advances to a venture ($217.6 million and $210.0 million, respectively). For deferred gains from partial sales recorded prior to the adoption of the new revenue recognition standard, we will continue to recognize these gains over the lives of the underlying real estate properties or at the time of disposition to a third party.

(3)	Represents our weighted average ownership interest in all co-investment ventures based on each entity’s contribution of total assets, before depreciation, net of other liabilities.

Equity Commitments Related to Certain Unconsolidated Co-Investment Ventures

The following table summarizes the remaining equity commitments at September 30, 2018 (in millions):

	Equity Commitments						Expiration Date
	Prologis		Venture Partners		Total
Prologis Targeted U.S. Logistics Fund	$	-	$	348	$	348	2019 – 2020
Prologis European Logistics Fund (1)		-		1,010		1,010	2019
Prologis UK Logistics Venture (2)		18		101		119	2021
Prologis China Logistics Venture		246		1,395		1,641	2020 – 2024
Total	$	264	$	2,854	$	3,118

(1)	Equity commitments are denominated in euro and reported in U.S. dollars based on an exchange rate of $1.16 U.S. dollars to the euro.

(2)	Equity commitments are denominated in British pounds sterling and reported in U.S. dollars based on an exchange rate of $1.30 U.S. dollars to the British pound sterling.