Plans by the city of Chicago to expand the O’Hare International Airport means Macquarie ProLogis Trust has had to sell the O’Hare Cargo Distribution Center #7, which is located on the site. The trust received $US17.6 million before sales cost for the property.

Geoff Lovell, chief executive officer for Macquarie ProLogis, said the sale was pretty much compulsory. “The city of Chicago had legislative powers to acquire the assets. But we certainly think we got a very good price for the property.” The trust will use US$8.4 million of proceeds from the sale to repay existing debt on the property. The remaining share of the proceeds will be used to increase the trust’s interest in its existing assets. Lovell said the trust has bought interests in some properties which were partially leased. In these cases the trust had to defer acquiring the leased parts of the buildings until the leases became available. He said over the next few months Macquarie ProLogis should be able to increase its interests in about three buildings as leases expire. Lovell said Macquarie ProLogis’ strategy was to be a long term investor, but because of high property prices at the moment he would not rule out further sales. He said any further divestments would not be large scale and would be at the margins of the trust’s portfolio. In the four years it has been running, the trust has only sold one other building, the Principio Business Park #1 last December. The trust has assets of about $2.1 billion consisting of interests in 138 warehouse and distribution facilities throughout North America. The properties have a 98 per cent occupancy rate.

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