PLD Prologis

By Dana Mattioli 

Prologis Inc. is nearing an agreement to buy logistics provider DCT Industrial Trust Inc. in a deal that could be valued at about $8 billion or more, according to people familiar with the matter.

Terms of the talks couldn't be learned, but the two sides could announce a deal as soon as Sunday, the people said. DCT has a market value of nearly $6 billion.

The company, based in Denver, is an industrial real-estate investment trust with a specialization in logistics.

Prologis, a big logistics provider based in San Francisco, has a market value of $36 billion.

Prologis is the world's largest owner of distribution centers and logistics properties, a market that has been changing rapidly as e-commerce fulfillment needs have drawn more investment into the field and warehouse development in the U.S., Europe and Asia has boomed.

Both companies develop and manage logistics real-estate properties in a market that has been surging in recent years as e-commerce growth has fueled demand for more distribution centers, including pricey sites near population centers that are used to ship online purchases more rapidly to consumers.

Prologis is by far the world's biggest developer and owner of distribution space, with an estimated 676 million square feet of warehousing under its control at the end of 2016, according to National Real Estate Investor. DCT was No. 10 in the world in the same survey, with 74 million square feet of space.

A Chinese private equity consortium bought the logistics real-estate market's second-biggest player, Singapore-based Global Logistic Properties, last year for $16 billion. GLP is the biggest operator of warehouses in Asia and holds significant properties in China and Japan, as well as the U.S.

Rental rates in industrial real-estate markets have been surging, growing at a more-than-5% annual rate in each of the last seven quarters, as demand has outpaced supply, according to real estate broker CBRE Inc. The firm said the 7.3% availability rate for warehouse space in the U.S. in the first quarter was the lowest in 17 years.

Paul Page contributed to this article

Write to Dana Mattioli at dana.mattioli@wsj.com

(END) Dow Jones Newswires

April 29, 2018 15:30 ET (19:30 GMT)

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