Debt

All debt is held directly or indirectly by the Operating Partnership. The REIT itself does not have any indebtedness, but guarantees the unsecured debt of the Operating Partnership. We generally do not guarantee the debt issued by non-wholly owned subsidiaries.

Our debt consisted of the following (dollars in thousands):


	September 30, 2013					December 31, 2012
	Weighted Average Interest Rate (1)			Amount Outstanding (2)		Weighted Average Interest Rate (1)			Amount Outstanding
Credit Facilities		1.2	%	$	992,776		1.5	%	$	888,966
Senior notes		5.1	%		4,980,625		5.6	%		5,223,136
Exchangeable senior notes (3)		3.3	%		397,481		4.6	%		876,884
Secured mortgage debt (4)		5.2	%		1,772,342		4.0	%		3,625,908
Secured mortgage debt of consolidated entities		4.5	%		296,783		4.4	%		450,923
Other debt of consolidated entities		4.5	%		4,345		4.8	%		67,749
Term loan and other debt		1.7	%		674,965		1.8	%		657,228

Totals		4.3	%	$	9,119,317		4.4	%	$	11,790,794

(1)	The interest rates presented represent the effective interest rates (including amortization of the non-cash premiums or discount).

(2)	Included in the outstanding balances are borrowings denominated in non-U.S. currency, principally: euro ($1.4 billion) and Japanese yen ($0.5 billion).

(3)

The weighted average coupon interest rate was 3.3% and 2.8% as of September 30, 2013 and December 31, 2012, respectively. During the second quarter of 2013, we repaid $342.2 million of these notes. As of September 30, 2013, we have one series of exchangeable notes outstanding with a coupon interest rate of 3.3%.

(4)	In the first quarter of 2013, we repaid $1.4 billion of outstanding secured mortgage debt with the proceeds received from contributions of properties to PELP and NPR. In addition, we transferred $353.2 million of debt to PELP in connection with the contribution.

Credit Facilities

On July 11, 2013, we terminated our existing global senior credit facility (the “Global Facility”) and entered into a new facility. Under the new facility funds may be drawn in U.S. dollar, euro, Japanese yen, British pound sterling and Canadian dollar on a revolving basis up to $2.0 billion (subject to currency fluctuations). We may increase the Global Facility to $3.0 billion (subject to currency fluctuations and obtaining additional lender commitments). The Global Facility is scheduled to mature on July 11, 2017; however, we may extend the maturity date by six months twice, subject to satisfaction of certain conditions and payment of an extension fee. Pricing under the Global Facility, including the spread over LIBOR, facility fees and letter of credit fees, varies based upon the public debt ratings of the Operating Partnership. The Global Facility contains customary representations, covenants and defaults (including a cross-acceleration to other recourse indebtedness of more than $50 million).

On August 14, 2013, we entered into a fourth amended and restated Japanese yen revolver (the “Revolver”). As a result, we increased our availability under the Revolver to ¥45.0 billion (approximately $461.2 million at September 30, 2013). The Revolver matures on May 14, 2018. We may increase availability under the Revolver to an amount not exceeding ¥56.5 billion (approximately $579.0 million at September 30, 2013) subject to obtaining additional lender commitments. Pricing under the Revolver was consistent with the Global Facility pricing as of September 30, 2013. The Revolver contains certain customary representations, covenants and defaults that are substantially the same as the corresponding provisions of the Global Facility.

We refer to the Global Facility and the Revolver, collectively, as our “Credit Facilities”.

Commitments and availability under our Credit Facilities as of September 30, 2013, were as follows (dollars in millions):


Aggregate lender - commitments	$	2,504.4
Less:
Borrowings outstanding		992.8
Outstanding letters of credit		72.3

Current availability	$	1,439.3

In February 2013, we entered into a $500 million bridge loan under which we can borrow in U. S. dollar, euro or yen. We borrowed ¥20 billion ($215.7 million) under the bridge loan to make our initial cash investment in NPR. In connection with the contribution of properties to NPR, we paid the borrowings outstanding on this bridge loan and terminated the facility.

Senior Notes

In connection with the equity offering in April 2013 (see Note 8 for additional details), we repaid $202.3 million of outstanding senior notes at maturity and incurred $32.6 million of debt extinguishment costs, primarily due to the prepayment of $350.0 million of senior notes that were scheduled to mature in 2014. In August 2013, we issued $1.25 billion of senior notes, consisting of $400.0 million at an interest rate of 2.75% maturing in 2019, at 99.97% of par value for an all-in rate of 2.76%; and $850.0 million at an interest rate of 4.25% maturing in 2023, at 99.74% of par value for an all-in rate of 4.28%. In connection with this issuance, we tendered several series of debt maturing in 2018 through 2020 and acquired an aggregate principal amount of debt equal to $611.4 million and recognized $114.1 million loss from the early extinguishment. We used the remaining proceeds of this issuance to repay borrowings on our Credit Facilities.

In October 2013, we commenced an any and all tender offer through which we purchased $261.7 million in principal amount of our senior notes that mature in 2017 for a premium of $41.2 million, which will be recognized as a loss on early extinguishment of debt. In conjunction with this tender, we commenced another tender offer through which we may repurchase a portion of our senior notes that mature in 2018 for an aggregate purchase price up to approximately $45 million including premiums and accrued interest. The second tender offer is expected to expire on November 21, 2013. To fund the repurchase of these notes and repay borrowings on our Credit Facilities, on November 1, 2013, we issued $500 million in principal amount of senior notes with an interest rate of 3.35% and a maturity date of February 1, 2021.

Exchangeable Senior Notes

The accounting for the exchangeable senior notes requires us to separate the fair value of the derivative instrument (exchange feature) from the debt instrument and account for it separately as a derivative. At each reporting period, we adjust the derivative instrument to fair value with the resulting adjustment being recorded in earnings as Foreign Currency and Derivative Gains (Losses), Net in the Consolidated Statements of Operations. The fair value of the derivative associated with our exchangeable notes was a liability of $46.4 million and $39.8 million at September 30, 2013 and December 31, 2012, respectively. We recognized an unrealized gain of $6.5 million and an unrealized loss of $6.6 million for the three and nine months ended September 30, 2013, respectively, and an unrealized loss of $6.7 million and $19.1 million for the three and nine months ended September 30, 2012, respectively.

Long-Term Debt Maturities

Principal payments due on our debt, for the remainder of 2013 and for each of the years in the ten-year period ending December 31, 2022, and thereafter were as follows (in millions):


	Prologis
	Unsecured									Secured				Consolidated		Total
	Senior		Exchangeable			Credit		Other		Mortgage				Entities’		Consolidated
Maturity	Debt		Notes			Facilities		Debt		Debt		Total		Debt (1)		Debt
2013 (2)	$	—	$	—		$	—	$	—	$	48	$	48	$	30	$	78
2014 (2)		574		—			—		659		291		1,524		27		1,551
2015		175		460			—		1		164		800		25		825
2016		641		—			—		1		310		952		126		1,078
2017		700		—			850		1		229		1,780		4		1,784
2018		862		—			142		1		113		1,118		74		1,192
2019		693		—			—		1		294		988		2		990
2020		444		—			—		1		9		454		2		456
2021		—		—			—		—		137		137		2		139
2022		—		—			—		—		7		7		3		10
Thereafter		850		—			—		10		137		997		6		1,003

Subtotal		4,939		460			992		675		1,739		8,805		301		9,106
Unamortized premiums (discounts), net		42		(63	)		—		—		33		12		1		13

Total	$	4,981	$	397		$	992	$	675	$	1,772	$	8,817	$	302	$	9,119

(1)	Our consolidated entities have $13.7 million available to borrow under credit facilities.

(2)

We expect to use cash on hand to repay 2013 maturities of our wholly owned debt. Of the amounts maturing in 2014, we expect to refinance or repay these amounts with proceeds from asset sales, available cash and borrowings on our Credit Facilities. The maturities in 2013 of debt of our consolidated but not wholly owned subsidiaries includes $30.1 million of secured mortgage debt, which we expect to refinance or repay, through the issuance of new debt, with proceeds from asset sales, available cash or equity contributions to our consolidated entities by us and our venture partners. Included in other debt is a term loan that can be extended until 2017 (three times each at one year), subject to satisfaction of certain conditions and payment of an extension fee.

Debt Covenants

Our debt agreements contain various covenants, including maintenance of specified financial ratios. As of September 30, 2013, we were in compliance with all covenants.