EXHIBIT 99.2

PROLOGIS, INC. AND PROLOGIS, L.P.

PRO FORMA CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

 

 

Unless stated otherwise or the context otherwise requires, references to “Prologis, Inc.” mean Prologis, Inc. and its consolidated subsidiaries; and references to “Prologis, L.P.” or the “Operating Partnership” mean Prologis, L.P., and its consolidated subsidiaries. The terms “the Company,” “Prologis,” “we,” “our” or “us” means Prologis, Inc. and the Operating Partnership collectively. Please refer to the explanatory note provided in our Quarterly Report on Form 10-Q for the quarter ended June 30, 2015, and in our Annual Report on Form 10-K for the year ended December 31, 2014.

On May 29, 2015, we acquired the real estate assets and operating platform of KTR Capital Partners and its affiliates (“KTR”). The portfolio included 315 operating properties aggregating 59 million square feet, 3.6 million square feet of properties under development and land parcels that will support an estimated build out of 6.8 million square feet (the “Portfolio”). The properties were acquired by our consolidated co-investment venture Prologis U.S. Logistics Venture (“USLV”), of which we own 55%. The acquisition was funded through cash, the assumption of secured mortgage debt and the issuance of 4.5 million common limited partnership units in the Operating Partnership. Prologis’ portion of cash paid for the acquisition was $2.6 billion. We incurred $24.7 million of acquisition costs that were included in Other Expense in the Consolidated Statements of Operations for the six months ended June 30, 2015.

This pro forma consolidated financial information should be read in conjunction with the consolidated financial statements included in our Form 10-K for the fiscal year ended December 31, 2014, and our Form 10-Q for the quarter ended June 30, 2015, as filed with the Securities and Exchange Commission. The Form 10-Q for the quarter ended June 30, 2015, reflects the acquisition of KTR; therefore, the pro forma consolidated financial information does not include a consolidated balance sheet as of June 30, 2015.

The purchase allocation adjustments made in connection with the pro forma consolidated statements of operations are based on the information available at this time. Subsequent purchase allocation adjustments may be made based on additional information.

The KTR Portfolio’s historical financial statements include rental revenue and expenses related to various properties that were sold by KTR in 2014 and 2015 and not acquired by us. Pro forma adjustments have been reflected in the statements below to eliminate such rental revenue and expenses related to these properties.

The pro forma consolidated financial information does not purport to represent the Company’s results of operations that would actually have occurred had the acquisition of KTR occurred on January 1, 2014; nor does it purport to project our results of operations as of any future date or for any future period.


PROLOGIS, INC.

PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS (Unaudited)

FOR THE SIX MONTHS ENDED JUNE 30, 2015

(In thousands, except per share amounts)

 

     Prologis, Inc.
Historical (1)
    KTR
Portfolio (2)
    Pro Forma
Adjustments
    Pro Forma
Consolidated
 

Revenues:

        

Rental income

   $ 682,375      $ 119,728      $ 7,724 (3)    $ 809,827   

Rental recoveries

     197,871        34,215        —          232,086   

Strategic capital income

     89,071        —          —          89,071   

Development management and other income

     3,934        —          —          3,934   
  

 

 

   

 

 

   

 

 

   

 

 

 

Total revenues

  973,251      153,943      7,724      1,134,918   
  

 

 

   

 

 

   

 

 

   

 

 

 

Expenses:

Rental expenses

  252,533      46,773      (2,714 )(4)    296,592   

Strategic capital expenses

  40,476      —        —        40,476   

General and administrative expenses

  113,315      —        —        113,315   

Depreciation and amortization

  359,996      —        62,119 (5)    422,115   

Other expenses

  35,702      —        (24,666 )(6)    11,036   
  

 

 

   

 

 

   

 

 

   

 

 

 

Total expenses

  802,022      46,773      34,739      883,534   
  

 

 

   

 

 

   

 

 

   

 

 

 

Operating income

  171,229      107,170      (27,015   251,384   

Other income (expense):

Earnings from unconsolidated entities, net

  72,826      —        —        72,826   

Interest expense

  (137,663   (13,301   (9,729 )(7)    (160,693

Interest and other income, net

  12,896      —        —        12,896   

Gains on dispositions of investments in real estate, net

  386,497      —        —        386,497   

Foreign currency and derivative gains and related amortization, net

  9,054      —        —        9,054   

Losses on early extinguishment of debt, net

  (16,525   —        —        (16,525
  

 

 

   

 

 

   

 

 

   

 

 

 

Total other income (expense)

  327,085      (13,301   (9,729   304,055   
  

 

 

   

 

 

   

 

 

   

 

 

 

Earnings before income taxes

  498,314      93,869      (36,744   555,439   

Current income tax expense

  5,545      —        —        5,545   

Deferred income tax expense

  1,197      —        —        1,197   
  

 

 

   

 

 

   

 

 

   

 

 

 

Total income tax expense

  6,742      —        —        6,742   
  

 

 

   

 

 

   

 

 

   

 

 

 

Consolidated net earnings

  491,572      93,869      (36,744   548,697   

Net (earnings) attributable to noncontrolling interests

  (2,778  
—  
  
  (32,219 )(8)    (34,997
  

 

 

   

 

 

   

 

 

   

 

 

 

Net earnings attributable to controlling interests

  488,794      93,869      (68,963   513,700   

Less preferred stock dividends

  3,348      —        —        3,348   
  

 

 

   

 

 

   

 

 

   

 

 

 

Net earnings attributable to common stockholders

$ 485,446    $ 93,869    $ (68,963 $ 510,352   
  

 

 

   

 

 

   

 

 

   

 

 

 

Weighted average common shares outstanding - Basic

  518,791      —        518,791   
  

 

 

     

 

 

   

 

 

 

Weighted average common shares outstanding - Diluted

  529,827      3,704 (9)    533,531   
  

 

 

     

 

 

   

 

 

 

Net earnings per share attributable to common stockholders - Basic

$ 0.94    $ 0.98   
  

 

 

       

 

 

 

Net earnings per share attributable to common stockholders - Diluted

$ 0.92    $ 0.97   
  

 

 

       

 

 

 

The accompanying notes are an integral part of this pro forma condensed consolidated statement of operations.

 

2


PROLOGIS, INC.

PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS (Unaudited)

FOR THE YEAR ENDED DECEMBER 31, 2014

(In thousands, except per share amounts)

 

     Prologis, Inc.
Historical (10)
    KTR
Portfolio
(11)
    Pro Forma
Adjustments
    Pro Forma
Consolidated
 

Revenues:

        

Rental income

   $ 1,178,609      $ 250,790      $ (14,579 )(12)    $ 1,414,820   

Rental recoveries

     348,740        67,988        —          416,728   

Strategic capital income

     219,871        —          —          219,871   

Development management and other income

     13,567        —          —          13,567   
  

 

 

   

 

 

   

 

 

   

 

 

 

Total revenues

     1,760,787        318,778        (14,579     2,064,986   
  

 

 

   

 

 

   

 

 

   

 

 

 

Expenses:

        

Rental expenses

     430,787        98,334        (15,124 )(13)      513,997   

Strategic capital expenses

     96,496        —          —          96,496   

General and administrative expenses

     247,768        —          —          247,768   

Depreciation and amortization

     642,461        —          165,650 (14)      808,111   

Other expenses

     23,467        —          —          23,467   
  

 

 

   

 

 

   

 

 

   

 

 

 

Total expenses

     1,440,979        98,334        150,526        1,689,839   
  

 

 

   

 

 

   

 

 

   

 

 

 

Operating income

     319,808        220,444        (165,105     375,147   

Other income (expense):

        

Earnings from unconsolidated entities, net

     134,288        —          —          134,288   

Interest expense

     (308,885     (32,145     (23,128 )(15)      (364,158

Interest and other income, net

     25,768        —          —          25,768   

Gains on dispositions of investments in real estate and revaluation of equity investments upon acquisition of a controlling interest, net

     725,790        —          —          725,790   

Foreign currency and derivative (losses) and related amortization, net

     (17,841     —          —          (17,841

Losses on early extinguishment of debt, net

     (165,300     —          —          (165,300
  

 

 

   

 

 

   

 

 

   

 

 

 

Total other income (expense)

     393,820        (32,145     (23,128     338,547   
  

 

 

   

 

 

   

 

 

   

 

 

 

Earnings (loss) before income taxes

     713,628        188,299        (188,233     713,694   

Current income tax expense

     (61,584     —          —          (61,584

Deferred income tax benefit

     87,240        —          —          87,240   
  

 

 

   

 

 

   

 

 

   

 

 

 

Total income tax expense

     25,656        —          —          25,656   
  

 

 

   

 

 

   

 

 

   

 

 

 

Consolidated net earnings

     739,284        188,299        (188,233     739,350   

Net (earnings) attributable to noncontrolling interests

     (103,101     —          (7,670 )(16)      (110,771
  

 

 

   

 

 

   

 

 

   

 

 

 

Net earnings attributable to controlling interests

     636,183        188,299        (195,903     628,579   

Less preferred stock dividends

     7,431        —          —          7,431   

Loss on preferred stock redemption / repurchase

     6,517        —          —          6,517   
  

 

 

   

 

 

   

 

 

   

 

 

 

Net earnings attributable to common stockholders

   $ 622,235      $ 188,299      $ (195,903   $ 614,631   
  

 

 

   

 

 

   

 

 

   

 

 

 

Weighted average common shares outstanding - Basic

     499,583          —          499,583   
  

 

 

     

 

 

   

 

 

 

Weighted average common shares outstanding - Diluted

     506,391          4,500 (17)      510,891   
  

 

 

     

 

 

   

 

 

 

Net earnings per share attributable to common stockholders - Basic

   $ 1.25          $ 1.23   
  

 

 

       

 

 

 

Net earnings per share attributable to common stockholders - Diluted

   $ 1.24          $ 1.22   
  

 

 

       

 

 

 

The accompanying notes are an integral part of this pro forma condensed consolidated statement of operations.

 

3


PROLOGIS, L.P.

PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS (Unaudited)

FOR THE SIX MONTHS ENDED JUNE 30, 2015

(In thousands, except per unit amounts)

 

     Prologis, L.P.     KTR     Pro Forma     Pro Forma  
     Historical (1)     Portfolio (2)     Adjustments     Consolidated  

Revenues:

        

Rental income

   $ 682,375      $ 119,728      $ 7,724 (3)    $ 809,827   

Rental recoveries

     197,871        34,215        —          232,086   

Strategic capital income

     89,071        —          —          89,071   

Development management and other income

     3,934        —          —          3,934   
  

 

 

   

 

 

   

 

 

   

 

 

 

Total revenues

     973,251        153,943        7,724        1,134,918   
  

 

 

   

 

 

   

 

 

   

 

 

 

Expenses:

        

Rental expenses

     252,533        46,773        (2,714 )(4)      296,592   

Strategic capital expenses

     40,476        —          —          40,476   

General and administrative expenses

     113,315        —          —          113,315   

Depreciation and amortization

     359,996        —          62,119 (5)      422,115   

Other expenses

     35,702        —          (24,666 )(6)      11,036   
  

 

 

   

 

 

   

 

 

   

 

 

 

Total expenses

     802,022        46,773        34,739        883,534   
  

 

 

   

 

 

   

 

 

   

 

 

 

Operating income

     171,229        107,170        (27,015     251,384   

Other income (expense):

        

Earnings from unconsolidated entities, net

     72,826        —          —          72,826   

Interest expense

     (137,663     (13,301     (9,729 )(7)      (160,693

Interest and other income, net

     12,896        —          —          12,896   

Gains on dispositions of investments in real estate, net

     386,497        —          —          386,497   

Foreign currency and derivative gains and related amortization, net

     9,054        —          —          9,054   

Losses on early extinguishment of debt, net

     (16,525     —          —          (16,525
  

 

 

   

 

 

   

 

 

   

 

 

 

Total other income (expense)

     327,085        (13,301     (9,729     304,055   
  

 

 

   

 

 

   

 

 

   

 

 

 

Earnings before income taxes

     498,314        93,869        (36,744     555,439   

Current income tax expense

     5,545        —          —          5,545   

Deferred income tax expense

     1,197        —          —          1,197   
  

 

 

   

 

 

   

 

 

   

 

 

 

Total income tax expense

     6,742        —          —          6,742   
  

 

 

   

 

 

   

 

 

   

 

 

 

Consolidated net earnings

     491,572        93,869        (36,744     548,697   

Net (earnings) attributable to noncontrolling interests

     (198     —          (28,443 )(8)      (28,641
  

 

 

   

 

 

   

 

 

   

 

 

 

Net earnings attributable to controlling interests

     491,374        93,869        (65,187     520,056   

Less preferred unit distributions

     3,348        —          —          3,348   
  

 

 

   

 

 

   

 

 

   

 

 

 

Net earnings attributable to common unitholders

   $ 488,026      $ 93,869      $ (65,187   $ 516,708   
  

 

 

   

 

 

   

 

 

   

 

 

 

Weighted average common units outstanding - Basic

     521,548          3,704 (9)      525,252   
  

 

 

     

 

 

   

 

 

 

Weighted average common units outstanding - Diluted

     529,827          3,704 (9)      533,531   
  

 

 

     

 

 

   

 

 

 

Net earnings per unit attributable to common unitholders - Basic

   $ 0.94          $ 0.98   
  

 

 

       

 

 

 

Net earnings per unit attributable to common unitholders - Diluted

   $ 0.92          $ 0.97   
  

 

 

       

 

 

 

The accompanying notes are an integral part of this pro forma condensed consolidated statement of operations.

 

4


PROLOGIS, L.P.

PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS (Unaudited)

FOR THE YEAR ENDED DECEMBER 31, 2014

(In thousands, except per unit amounts)

 

     Prologis, L.P.
Historical (10)
    KTR
Portfolio
(11)
    Pro Forma
Adjustments
    Pro Forma
Consolidated
 

Revenues:

        

Rental income

   $ 1,178,609      $ 250,790      $ (14,579 )(12)    $ 1,414,820   

Rental recoveries

     348,740        67,988        —          416,728   

Strategic capital income

     219,871        —          —          219,871   

Development management and other income

     13,567        —          —          13,567   
  

 

 

   

 

 

   

 

 

   

 

 

 

Total revenues

     1,760,787        318,778        (14,579     2,064,986   
  

 

 

   

 

 

   

 

 

   

 

 

 

Expenses:

        

Rental expenses

     430,787        98,334        (15,124 )(13)      513,997   

Strategic capital expenses

     96,496        —          —          96,496   

General and administrative expenses

     247,768        —          —          247,768   

Depreciation and amortization

     642,461        —          165,650 (14)      808,111   

Other expenses

     23,467        —          —          23,467   
  

 

 

   

 

 

   

 

 

   

 

 

 

Total expenses

     1,440,979        98,334        150,526        1,689,839   
  

 

 

   

 

 

   

 

 

   

 

 

 

Operating income

     319,808        220,444        (165,105     375,147   

Other income (expense):

        

Earnings from unconsolidated entities, net

     134,288        —          —          134,288   

Interest expense

     (308,885     (32,145     (23,128 )(15)      (364,158

Interest and other income, net

     25,768        —          —          25,768   

Gains on dispositions of investments in real estate and revaluation of equity investments upon acquisition of a controlling interest, net

     725,790        —          —          725,790   

Foreign currency and derivative (losses) and related amortization, net

     (17,841     —          —          (17,841

Losses on early extinguishment of debt, net

     (165,300     —          —          (165,300
  

 

 

   

 

 

   

 

 

   

 

 

 

Total other income (expense)

     393,820        (32,145     (23,128     338,547   
  

 

 

   

 

 

   

 

 

   

 

 

 

Earnings (loss) before income taxes

     713,628        188,299        (188,233     713,694   

Current income tax expense

     (61,584     —          —          (61,584

Deferred income tax benefit

     87,240        —          —          87,240   
  

 

 

   

 

 

   

 

 

   

 

 

 

Total income tax expense

     25,656        —          —          25,656   
  

 

 

   

 

 

   

 

 

   

 

 

 

Consolidated net earnings

     739,284        188,299        (188,233     739,350   

Net (earnings) attributable to noncontrolling interests

     (100,900     —          (2,161 )(16)      (103,061
  

 

 

   

 

 

   

 

 

   

 

 

 

Net earnings attributable to controlling interests

     638,384        188,299        (190,394     636,289   

Less preferred unit distributions

     7,431        —          —          7,431   

Loss on preferred unit redemption / repurchase

     6,517        —          —          6,517   
  

 

 

   

 

 

   

 

 

   

 

 

 

Net earnings attributable to common unitholders

   $ 624,436      $ 188,299      $ (190,394   $ 622,341   
  

 

 

   

 

 

   

 

 

   

 

 

 

Weighted average common units outstanding - Basic

     501,349          4,500 (17)      505,849   
  

 

 

     

 

 

   

 

 

 

Weighted average common units outstanding - Diluted

     506,391          4,500 (17)      510,891   
  

 

 

     

 

 

   

 

 

 

Net earnings per unit attributable to common unitholders - Basic

   $ 1.25          $ 1.23   
  

 

 

       

 

 

 

Net earnings per unit attributable to common unitholders - Diluted

   $ 1.24          $ 1.22   
  

 

 

       

 

 

 

The accompanying notes are an integral part of this pro forma condensed consolidated statement of operations.

 

5


PROLOGIS, INC. AND PROLOGIS, L.P.

ADJUSTMENTS TO THE PRO FORMA CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)

FOR THE SIX MONTHS ENDED JUNE 30, 2015 AND FOR THE YEAR ENDED DECEMBER 31, 2014

 

 

 

(1) Represents the consolidated statement of operations for Prologis, Inc. or Prologis, L.P. for the six months ended June 30, 2015, which was included in our previously filed Quarterly Report on Form 10-Q for the quarter ended June 30, 2015. Included in these results is $27.4 million of net operating income (rental income less rental expenses) from the date of acquisition through June 30, 2015. The difference between the net operating income recognized in our operating results and the historical KTR Portfolio net operating income primarily relates to leasing activity in the Portfolio and development properties that were stabilized during 2014 and 2015. As of June 30, 2015, the KTR Portfolio of operating properties was 90% occupied.
(2) This information represents the combined revenue and certain expenses of KTR for the period from January 1, 2015, through the acquisition date of May 29, 2015.
(3) Rental income is adjusted to recognize: (i) $1.1 million reduction due to properties sold prior to acquisition, (ii) $9.4 million increase of total minimum lease payments provided under the acquired leases on a straight line basis over the remaining lease term and (iii) the amortization of the asset or liability from the acquired leases with favorable or unfavorable rents relative to estimated market rents, including a reduction of $2.4 million from amortization of the asset and an increase of $1.8 million from amortization of the liability. The asset or liability from the acquired leases with favorable or unfavorable market rents relative to estimated market rents is amortized using the remaining lease term associated with these leases, which is approximately five years.
(4) Rental expense is adjusted for (i) $0.4 million reduction due to properties sold, (ii) a $4.0 million reduction for the removal of the Portfolio’s historical property management fees; and (iii) a $1.7 million increase of property management expense which primarily include estimated incremental salaries and benefits for property management personnel.
(5) Depreciation and amortization expense is recorded based on the preliminary purchase price allocation of KTR to recognize real estate depreciation expense of $53.8 million as a result of the acquisition of the properties acquired and to reflect amortization expense of $8.3 million on intangible assets recognized related to the estimated value of in-place leases as of January 1, 2014. We estimated the average useful life of the properties to be 35 years and the remaining lease term associated with the in-place leases to be approximately six years.
(6) Other expenses is adjusted to exclude acquisition costs of $24.7 million incurred by the Company related to the acquisition of the Portfolio, as these costs were directly attributable to the Portfolio acquisition and are not recurring in nature.
(7) The adjustment to interest expense includes: (i) the removal of the Portfolio’s historical interest expense of $13.3 million; and (ii) the additional interest expense attributable to the debt assumed, which was adjusted to fair value, as well as the interest expense on the $1.8 billion of variable rate debt and $0.8 billion of fixed rate debt issued by Prologis to finance our cash portion of the acquisition ($2.6 billion) as detailed in the table below (in thousands):

 

     Pro forma      Weighted
Average
Effective Interest
    Additional Interest  

Debt

   Borrowings      Rate     Expense  

Secured mortgage debt assumed

   $ 735,172         2.69   $ 8,220   

Prologis cash portion of acquisition

     2,556,265         1.39     14,810   
       

 

 

 

Pro forma adjustment to interest expense

        $ 23,030   
       

 

 

 

A 12.5 basis points, or 1/8th of 1.0%, increase (decrease) in the one-month LIBOR would increase (decrease) interest expense by approximately $1.1 million for the six months ended June 30, 2015.

 

(8) An adjustment of $32.2 million was made to Prologis, Inc. and an adjustment of $28.4 million was made to Prologis, L.P. to reflect: (i) the adjustment to the income allocated to noncontrolling interests, (ii) adjustment to reflect our partner’s share of increased asset management fees within USLV; and (iii) the adjustment related to the limited partnership unitholders ownership percentage.
(9) Represents the weighted average effect of Operating Partnership units issued in connection with the acquisition of the Portfolio.
(10) Represents the consolidated statement of operations for Prologis, Inc. or Prologis L.P. for the year ended December 31, 2014, which was included in our previously filed Annual Report on Form 10-K for the fiscal year ended December 31, 2014.
(11) This information represents the combined revenue and certain expenses of the Portfolio for the year ended December 31, 2014, which is included in Exhibit 99.1 to this Report on Form 8-K/A.

 

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PROLOGIS, INC. AND PROLOGIS, L.P.

ADJUSTMENTS TO THE PRO FORMA CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)

FOR THE SIX MONTHS ENDED JUNE 30, 2015 AND FOR THE YEAR ENDED DECEMBER 31, 2014

 

 

 

(12) Rental income is adjusted to recognize: (i) $35.7 million reduction due to properties sold prior to acquisition, (ii) $22.7 million increase of total minimum lease payments provided under the acquired leases on a straight line basis over the remaining lease term; and (iii) the amortization of the asset or liability from the acquired leases with favorable or unfavorable rents relative to estimated market rents, including a reduction of $6.3 million from amortization of the asset and an increase of $4.7 million from amortization of the liability. The asset or liability from the acquired leases with favorable or unfavorable market rents relative to estimated market rents is amortized using the remaining lease term associated with these leases, which is approximately five years.
(13) Rental expense is adjusted for (i) $9.9 million reduction due to properties sold, (ii) a $9.4 million reduction for the removal of the Portfolio’s historical property management fees; and (iii) a $4.2 million increase of property management expense, which primarily include estimated incremental salaries and benefits for property management personnel.
(14) Depreciation and amortization expense is recorded based on the preliminary purchase price allocation of KTR to recognize real estate depreciation expense of $143.6 million as a result of the acquisition of the properties acquired and to reflect amortization expense of $22.1 million on intangible assets recognized related to the estimated value of in-place leases as of January 1, 2014. We estimated the average useful life of the industrial properties to be 35 years and the remaining lease term associated with the in-place leases to be approximately six years.
(15) The adjustment to interest expense includes: (i) the removal of the Portfolio’s historical interest expense of $32.1 million; and (ii) the additional interest expense attributable to the debt assumed, which was adjusted to fair value, as well as the interest expense on the $1.8 billion of variable rate debt and $0.8 billion of fixed rate debt issued by Prologis to finance our cash portion of the acquisition ($2.6 billion) as detailed in the table below (in thousands):

 

     Pro forma      Weighted
Average
Effective Interest
    Additional Interest  

Debt

   Borrowings      Rate     Expense  

Secured mortgage debt assumed

   $ 735,172         2.69   $ 19,727   

Prologis cash portion of acquisition

     2,556,265         1.39     35,545   
       

 

 

 

Pro forma adjustment to interest expense

        $ 55,272   
       

 

 

 

A 12.5 basis points, or 1/8th of 1.0%, increase (decrease) in the one-month LIBOR would increase (decrease) interest expense by approximately $2.2 million for the year.

 

(16) An adjustment of $7.7 million was made to Prologis Inc. and an adjustment of $2.2 million was made to Prologis, L.P. to reflect: (i) the adjustment to the income allocated to noncontrolling interests, (ii) adjustment to reflect our partner’s share of increased asset management fees within USLV and (iii) the adjustment related to the limited partnership unitholders ownership percentage.
(17) Represents the impact of Operating Partnership units issued in connection with the acquisition of the Portfolio.

 

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