Business Segments

3 Months Ended

Mar. 31, 2016

Segment Reporting [Abstract]

Business Segments

NOTE 12. BUSINESS SEGMENTS

Our current business strategy consists of two operating segments: Real Estate Operations and Strategic Capital. We generate revenues, earnings, net operating income and cash flows through our segments, as follows:

· Real Estate Operations. This operating segment represents the ownership of industrial operating properties and is the largest component of our revenue and earnings. We collect rent from our customers through operating leases, including reimbursements for the majority of our property operating costs. Each operating property is considered to be an individual operating segment with similar economic characteristics; these properties are combined within the reportable segment based on geographic location. Our Real Estate Operations segment also includes development activities that lead to rental operations, including land held for development and properties currently under development. Within this line of business, we capitalize on the following: (i) the land that we currently own; (ii) the development expertise of our local teams; (iii) our global customer relationships; and (iv) our in-depth knowledge of global demand for high-quality logistics facilities. Land we own and lease to customers under ground leases is also included in this segment.

· Strategic Capital. This operating segment represents the management of unconsolidated co-investment ventures. We generate strategic capital revenues from our unconsolidated co-investment ventures through asset management and property management services and we earn additional revenues by providing leasing, acquisition, construction, development, financing and disposition services. Depending on the structure of the venture and the returns provided to our partners, we also earn revenues through promotes during the life of a venture or upon liquidation. Each unconsolidated co-investment venture we manage is considered to be an individual operating segment with similar economic characteristics; these ventures are combined within the reportable segment based on geographic location.

Reconciliations are presented below for: (i) each reportable business segment’s revenue from external customers to Total Revenues; (ii) each reportable business segment’s net operating income from external customers to Earnings Before Income Taxes; and (iii) each reportable business segment’s assets to Total Assets. Our chief operating decision makers rely primarily on net operating income and similar measures to make decisions about allocating resources and assessing segment performance. The applicable components of Total Revenues, Earnings Before Income Taxes and Total Assets are allocated to each reportable business segment’s revenues, net operating income and assets. Items that are not directly assignable to a segment, such as certain corporate income and expenses, are not allocated but reflected as reconciling items. The following reconciliations are presented in thousands:

	Three Months Ended
	March 31,
		2016			2015
Revenues:
Real estate operations:
U.S.	$	511,157		$	376,198
Other Americas		13,956			14,432
Europe		16,789			18,769
Asia		14,732			11,423
Total Real Estate Operations segment		556,634			420,822
Strategic capital:
U.S.		9,356			9,357
Other Americas		5,365			5,569
Europe		22,269			18,393
Asia		12,676			8,706
Total Strategic Capital segment		49,666			42,025
Total revenues	$	606,300		$	462,847
Net operating income:
Real estate operations:
U.S.	$	375,718		$	259,578
Other Americas		8,214			9,843
Europe		11,619			10,938
Asia		9,817			7,793
Total Real Estate Operations segment		405,368			288,152
Strategic capital:
U.S.		1,709			1,580
Other Americas		3,115			2,933
Europe		15,306			11,795
Asia		4,243			535
Total Strategic Capital segment		24,373			16,843
Total segment net operating income		429,741			304,995
Reconciling items:
General and administrative expenses, net		(50,543	)		(51,306	)
Depreciation and amortization expenses		(250,000	)		(169,808	)
Earnings from unconsolidated entities, net		58,311			31,042
Interest expense		(80,812	)		(68,761	)
Interest and other income, net		2,591			11,049
Gains on dispositions of investments in real estate, net		144,317			277,715
Foreign currency and derivative gains (losses) and related amortization, net		(14,211	)		34,566
Losses on early extinguishment of debt, net		(1,052	)		(16,289	)
Total reconciling items		(191,399	)		48,208
Earnings before income taxes	$	238,342		$	353,203

	March 31,		December 31,
		2016		2015
Assets:
Real estate operations:
U.S.	$	21,705,401	$	22,030,457
Other Americas		1,015,963		919,381
Europe		1,447,446		1,291,991
Asia		1,164,456		1,157,401
Total Real Estate Operations segment		25,333,266		25,399,230
Strategic capital:
U.S.		19,046		19,363
Europe		50,673		49,960
Asia		1,947		2,005
Total Strategic Capital segment		71,666		71,328
Total segment assets		25,404,932		25,470,558
Reconciling items:
Investments in and advances to unconsolidated entities		4,866,664		4,755,620
Assets held for sale or contribution		431,332		378,423
Notes receivable backed by real estate		37,550		235,050
Cash and cash equivalents		369,737		264,080
Other assets		265,533		291,036
Total reconciling items		5,970,816		5,924,209
Total assets	$	31,375,748	$	31,394,767