[1.1-1.2] Since ProLogis published its first GRI report three years ago, we have worked hard to improve, expand and refine what our commitment to sustainability means. At ProLogis, this concept incorporates business excellence, environmental stewardship and corporate social responsibility, which gives our sustainability initiative a "triple bottom line": benefit to the planet, to people and to the profitability that makes our existence possible. Embracing this definition commits us to making progress on all three fronts at the same time, and not one at the expense of others.
With that in mind, I believe it is important to recognize the vastly different landscape the industry is facing after last year's disruption in the credit markets and global economic recession. This change of events has had a dramatic impact on companies worldwide, and ProLogis has not been immune. In November of 2008, we had a change in the CEO role. My predecessor was a key driver behind our rapid growth and international expansion. However, as most companies are doing in the current environment, we have had to put our expansion plans on hold. We also have had to make some very tough decisions related to the structure and operations of our company, including selling our China operations and a portion of our Japan portfolio, halting new development starts worldwide and reducing our workforce.
Despite these challenging times, sustainability is an initiative to which ProLogis remains fully committed. We believe our focus on sustainability not only serves as a competitive differentiator but it enables us to establish strategic relationships with customers and partners as well as attract and retain the industry's most talented professionals, all of which ultimately impacts our triple bottom line.
As such, I'm pleased to report that we continued to raise the bar in our industry with regard to sustainability during 2008. Not only did we continue to implement our lighting retrofit and green building programs, but we also received external validation from two new global sustainability indexes, the Dow Jones Sustainability Index and the S&P U.S. Carbon Efficient Index.
We also made substantial progress toward our renewable energy goals and formalized our approach to working with utilities, investors and suppliers on projects at our facilities. As a result, we were able to announce the nation's first, and currently the largest, single roof-top solar lease with Southern California Edison in the first half of 2008, and our second roof-top lease with Portland General Electric later that year. Both agreements are a significant step in ProLogis' renewable energy program and enable us to generate additional value from our existing assets without any outlay of capital. More details about these two exciting solar projects are in the Environmental Section of this year's report.
- The Commercial Real Estate Development Association's (NAIOP) "Industrial Developer of the Year" in Atlanta, Georgia, based on our social responsibility, development and environmental awareness;
- The "Logistics Environmental Technology Development Award" in Japan for ProLogis' development and implementation of a precast concrete and seismic isolation system that reduced the amount of CO2 and Life Cycle CO2 emissions in multi-story facilities;
- The "Best Green Development in Central and Eastern Europe" for ProLogis Park Uzice in the Czech Republic based on the park's sustainable design, comfortable interior environment, access to public transport, economic viability and high quality building design;
- In the U.K., the Estates Gazette "Green Award" and Property Week's "European Green Award," both of which recognized our overall commitment to sustainability as well as our innovative facilities that set new standards in sustainable design; and,
- Mueller, Catellus' mixed-use redevelopment project in Austin, Texas, was named one of the “Top Ten Best Eco-Friendly Neighborhoods” by Natural Home, a magazine for health-conscious, environmentally concerned homeowners.
[4.5, 4.7, 4.9, 4.10] Perhaps the most significant improvement to our global sustainability platform during 2008 was the appointment a Chief Sustainability Officer and the establishment of a Board Sustainability Committee, which comprises three individuals who were selected for their experience and background in sustainability.
We are very proud of our accomplishments and hope you enjoy reading about our progress. If you have any feedback, we welcome you to let us know what you think.
Walter C. Rakowich
Chief Executive Officer