UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 11-K

(Mark One)

þ		ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

o		TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Commission file number: 001-12846

A.

Full title of the plan and the address of the plan, if different from that of the issuer named below:

B.

Name of issuer of the securities held pursuant to the plan and the address of its principal executive office:

ProLogis
4545 Airport Way
Denver, CO 80239

 

 

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401(k) SAVINGS PLAN

Table of Contents

		Page
Report of Independent Registered Public Accounting Firm			1
Statements of Net Assets Available for Plan Benefits — December 31, 2009 and 2008			2
Statements of Changes in Net Assets Available for Plan Benefits — Years Ended December 31, 2009 and 2008			3
Notes to Financial Statements			4
Supplemental Schedule
Schedule 1: Schedule H, Line 4i — Schedule of Assets (Held at End of Year) — December 31, 2009			10
Signature
Exhibit:
Exhibit 23.2 Consent of Independent Registered Public Accounting Firm
EX-23.2

Report of Independent Registered Public Accounting Firm

The Plan Administrator
ProLogis 401(k) Savings Plan:

We have audited the accompanying statements of net assets available for plan benefits of the ProLogis 401(k) Savings Plan (the Plan) as of December 31, 2009 and 2008, and the related statements of changes in net assets available for plan benefits for the years then ended. These financial statements are the responsibility of the Plan’s management. Our responsibility is to express an opinion on these financial statements based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in all material respects, the net assets available for plan benefits of the Plan as of December 31, 2009 and 2008, and the changes in net assets available for plan benefits for the years then ended in conformity with U.S. generally accepted accounting principles.

Our audits were performed for the purpose of forming an opinion on the basic financial statements taken as a whole. The supplemental schedule, Schedule H, Line 4i — Schedule of Assets (Held at End of Year) — December 31, 2009 is presented for the purpose of additional analysis and is not a required part of the basic financial statements but is supplementary information required by the Department of Labor’s Rules and Regulations for Reporting and Disclosure under the Employee Retirement Income Security Act of 1974. This supplemental schedule is the responsibility of the Plan’s management. The supplemental schedule has been subjected to the auditing procedures applied in the audits of the basic financial statements and, in our opinion, is fairly stated, in all material respects, in relation to the basic financial statements taken as a whole.

Denver, Colorado
June 9, 2010

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Statements of Net Assets Available for Plan Benefits

		December 31,
		2009				2008
Assets:
Investments, at fair value:
ProLogis common stock		$	5,120,110			$	4,716,047
Common collective trust			6,887,128				6,858,101
Mutual funds			37,418,800				29,261,820
Self directed brokerage account			395,262				298,224
Total investments, at fair value			49,821,300				41,134,192
Participant loans			558,416				414,151
Pending trade receivables			—				2,425
Pending trade payables			(38	)			—
Net assets available for plan benefits before adjustment			50,379,678				41,550,768
Adjustment from fair value to contract value for fully benefit-responsive contracts			(148,887	)			89,658
Net assets available for plan benefits		$	50,230,791			$	41,640,426

See accompanying notes to financial statements.

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Statements of Changes in Net Assets Available for Plan Benefits

		Year Ended December 31,
		2009				2008
Contributions:
Employer, net of forfeitures		$	1,183,583			$	1,460,983
Participants			3,073,528				3,746,233
Rollover			67,322				750,372
Total contributions			4,324,433				5,957,588
Investment income (loss):
Net appreciation (depreciation) in fair value of investments			7,373,157				(27,106,482	)
Interest and dividends			1,377,703				1,876,799
Total investment income (loss)			8,750,860				(25,229,683	)
Total contributions and income (loss)			13,075,293				(19,272,095	)
Deductions:
Benefits paid to participants			4,481,649				3,395,297
Administrative expenses			3,279				3,115
Total deductions			4,484,928				3,398,412
Net increase (decrease) during the year			8,590,365				(22,670,507	)
Net assets available for plan benefits:
Beginning of year			41,640,426				64,310,933
End of year		$	50,230,791			$	41,640,426

See accompanying notes to financial statements.

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401(k) SAVINGS PLAN

Notes to Financial Statements

(1)		Description of the Plan
		The following description of the ProLogis 401(k) Savings Plan (the “Plan”) provides only general information. Participants should refer to the Plan agreement for a more complete description of the Plan’s provisions.

	(a)		General
			The Plan is a defined contribution plan established by ProLogis (“ProLogis” or the “Company”). The Plan covers all eligible employees of the Company who have attained the age of 21. Eligibility to participate begins with the date of hire and participation is voluntary. The Plan is subject to the provisions of the Employee Retirement Income Security Act of 1974 (“ERISA”), as amended.
	(b)		Contributions
			Participants may contribute up to 75% of their pretax annual compensation, as defined in the Plan, not to exceed $16,500 ($22,000 if age 50 or older) in 2009 and $15,500 ($20,500 if age 50 or older) in 2008. Participants may also contribute amounts representing rollovers from other qualified plans. The Company matches 50% of participants’ contributions up to a maximum of 6% of eligible compensation. The Plan also provides for discretionary Company contributions, which are allocated to participants’ accounts based on the relative compensation of participants. There were no discretionary Company contributions during 2009 and 2008.
	(c)		Participant Accounts
			Each participant’s account is credited with the participant contributions, Company contributions and an allocation of Plan earnings. Earnings of the Plan are allocated to all participants’ accounts proportionately based on each participant’s account balance.
	(d)		Vesting
			Participants are immediately vested in their contributions and any income or loss thereon.
			Company contributions vest based upon the following schedule:

Years of service		Vesting percentage
Less than 1 year			0	%
1 year			20	%
2 years			40	%
3 years			60	%
4 years			80	%
5 or more years			100	%

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Notes to Financial Statements — Continued

	(e)		Investment Options
			Upon enrollment in the Plan, a participant may direct employee contributions into various investment options. Participant contributions may be invested in any or all of the investment options.
			The Company matching contributions deposited to the participant’s account follow the investment allocation of the participant’s elective deferral and participants are allowed to exchange out of the Company’s common stock immediately.
	(f)		Payment of Benefits
			Participants are entitled to receive benefit payments in the form of a lump-sum payment, an annuity or installment equal to 100% of their accrued benefit upon attainment of age 591/2, termination of employment, or upon death or disability. The accrued benefit includes the sum of the value of participants’ contributions, allocation of earnings (losses), and the vested portion of Company contributions.
	(g)		Forfeited Accounts
			If a participant is not 100% vested and receives a distribution of Company contributions, the dollars left in the Plan are called forfeitures. Unused forfeitures totaled approximately $4,100 and $300 at December 31, 2009 and 2008, respectively. Forfeiture allocations from Company discretionary contributions are used to reduce future Company discretionary contributions. There were no forfeiture amounts used for future Company discretionary contributions during 2009 or 2008. Forfeiture allocations from Company match contributions are used to reduce future Company match contributions. In 2009 and 2008, the amount of forfeitures used for Company match contributions was approximately $93,000 and $80,000, respectively.
	(h)		Loans to Participants
			The Plan permits loans to participants in an amount not to exceed the lesser of $50,000 or 50% of their vested account balance. Loan terms range from 1 to 29 years. The loans are secured by the participant’s account balance. Interest rates on participant’s loans range from 4.25% to 9.25% at December 31, 2009 and 5% to 9.25% at December 31, 2008. Principal and interest is paid ratably through regular payroll deductions. Loans are recorded at their outstanding balances.
	(i)		Hardship Withdrawals
			Participants may receive hardship withdrawals for reasons of financial hardship. Contributions from participants receiving a hardship withdrawal are disallowed for six months following the receipt of the hardship withdrawal.

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401(k) SAVINGS PLAN

Notes to Financial Statements — Continued

(2)

Summary of Significant Accounting Policies

	(a)		Basis of Accounting
			The financial statements of the Plan are prepared using the accrual basis of accounting.
	(b)		Use of Estimates
			The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, and changes therein, and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of additions and deductions in net assets during the reporting period. Actual results may differ from those estimates.
	(c)		Investment Valuation and Income Recognition
			The Plan’s investments are stated at fair value. The shares of mutual funds and common stock are based on quoted market prices.
			The investment contracts included in the common collective trust are presented at fair value on the statement of net assets available for plan benefits. The investments in the fully benefit-responsive investment contracts are also stated at contract value as reported by the investment advisor, which is equal to principal balance plus accrued interest. An investment contract is generally valued at contract value, rather than fair value, to the extent it is fully benefit-responsive. The fair value of fully benefit-responsive investment contracts is calculated using a discounted cash flow model which considers as the primary input recent fee bids as determined by recognized dealers, as adjusted for the discount rate and the duration of the underlying portfolio securities. The statements of net assets available for plan benefits presents the fair value of the investment in the common collective trust as well as the adjustment of the investment in the common collective trust from fair value to contract value relating to the investment contracts. The statements of changes in net assets available for plan benefits is prepared on a contract value basis.
			Purchases and sales of securities are recorded on a trade-date basis. Interest income is recorded on the accrual basis. Dividends are recorded on the ex-dividend date.
	(d)		Net Appreciation (Depreciation) in Fair Value of Investments
			Net realized and unrealized gains and losses, as reported in the accompanying Statement of Changes in Net Assets Available for Plan Benefits, is the cumulative difference between the fair value and the related cost of the Plan’s investments. Such income is allocated to participants’ accounts based on relative participant account balances.
	(e)		Administrative Expenses and Distributions
			The majority of administrative expenses of the Plan are paid by the Company. Unless paid by the Company, such expenses will be a charge upon Plan assets and deducted by the trustee to the extent permitted by applicable law.
	(f)		Benefits Paid to Participants
			Benefits paid to participants are recorded when paid.

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401(k) SAVINGS PLAN

Notes to Financial Statements — Continued

	(g)		Fair Value Measurements
			The Company has estimated fair value using available market information and valuation methodologies believed to be appropriate for these purposes. Considerable judgment and a high degree of subjectivity are involved in developing these estimates and, accordingly, they are not necessarily indicative of amounts that the Plan would realize upon disposition. The fair value hierarchy consists of three broad levels:

	•		Level 1 — Quoted prices in active markets for identical assets or liabilities that the entity has the ability to access.
	•		Level 2 — Observable inputs, other than quoted prices included in Level 1, such as quoted prices for similar assets and liabilities in active markets; quoted prices for identical or similar assets and liabilities in markets that are not active; or other inputs that are observable or can be corroborated by observable market data.
	•		Level 3 — Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets and liabilities. This includes certain pricing models, discounted cash flow methodologies and similar techniques that use significant unobservable inputs.

The Plan’s investments that are measured at fair value on a recurring basis, such as mutual funds and equity securities, are classified within Level 1 of the fair value hierarchy, as show in the table below. The fair value of these investments is valued based on quoted market prices in active markets.

		Assets at Fair Value as of December 31, 2009
		Level 1				Level 2				Level 3
ProLogis common stock		$	5,120,110			$	—			$	—
Common collective trust			—				6,887,128				—
Mutual funds			37,418,800				—				—
Self directed brokerage account — common stock			195,431				—				—
Self directed brokerage account — mutual funds			199,831				—				—
Total investments, at fair value		$	42,934,172			$	6,887,128			$	—

		Assets at Fair Value as of December 31, 2008
		Level 1				Level 2				Level 3
ProLogis common stock		$	4,716,047			$	—			$	—
Common collective trust			—				6,858,101				—
Mutual funds			29,261,820				—				—
Self directed brokerage account — common stock			203,495
Self directed brokerage account — mutual funds			94,729				—				—
Total investments, at fair value		$	34,276,091			$	6,858,101			$	—

The methods described above may produce a fair value calculation that may not be indicative of net realizable value or reflective of future fair values. Furthermore, while the Plan’s valuation methods are appropriate and consistent with other market participants, the use of different methodologies or assumptions to determine the fair value of certain financial instruments could result in a different fair value measurement at the reporting date.

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401(k) SAVINGS PLAN

Notes to Financial Statements — Continued

(3)		Investments
		The investments that represent 5% or more of the Plan’s net assets at December 31, 2009 and 2008 are as follows:

		2009				2008
ProLogis common stock		$	5,120,110			$	4,716,047
PIMCO Total Return Fund			4,115,887				3,777,393
Vanguard Growth Index Fund Investor Shares			3,860,728				2,728,476
Vanguard Target Retirement 2025 Fund			2,788,938				2,193,691
Vanguard 500 Index Fund Investor Shares			5,870,293				4,803,113
Vanguard Retirement Savings Trust (a)			6,738,241				6,947,759

During the years ended December 31, 2009 and 2008, the Plan’s investments (including gains and losses on investments bought and sold, as well as held during the year) appreciated (depreciated) in value as follows:

		2009				2008
Mutual funds		$	7,069,077			$	(15,518,750	)
ProLogis common stock			178,468				(11,325,325	)
Self directed brokerage account — common stock			103,960				(216,575	)
Self directed brokerage account — mutual funds			21,652				(45,832	)
		$	7,373,157			$	(27,106,482	)

(4)		Plan Termination
		Although the Company has not expressed any intention to terminate the Plan, it may do so at any time. In the event of termination of the Plan, participants will become fully vested in their accounts and the Plan’s trustee would distribute the assets in the Plan to participants.
		Additionally, the Plan’s sponsor may amend the Plan at any time without the consent of any participant or any beneficiary, provided that no amendment deprives any participant of the participant’s vested accrued benefit.
(5)		Tax Status
		The Plan adopted a volume submitter plan that received an opinion letter from the Internal Revenue Service dated March 31, 2008, stating that the written form of the underlying prototype plan document is qualified under Section 401 of the Internal Revenue Code (“IRC”), and that any employer adopting this form of the plan will be considered to have a plan qualified under Section 401(a) of the IRC. Once qualified, the Plan is required to operate in conformity with the IRC to maintain its qualification. ProLogis believes the Plan is being operated incompliance with the applicable requirements of the IRC and, therefore, believes that the Plan is qualified and the related trust is tax exempt as of December 31, 2009 and 2008.

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401(k) SAVINGS PLAN

Notes to Financial Statements — Continued

(6)		Related Party Transactions
		Certain Plan investments represent shares of a common collective trust, common stock, self directed brokerage account and mutual funds managed by Vanguard Fiduciary Trust Company (“Vanguard”) as of December 31, 2009 and 2008, respectively. Vanguard is the trustee as defined by the Plan and therefore, these investments and investment transactions qualify as party-in-interest transactions.
		Certain Plan investments represent shares of common stock of the Company as of December 31, 2009 and 2008. The Company is the plan sponsor as defined by the Plan and therefore, these investments and investment transactions qualify as party-in-interest transactions.
(7)		Risks and Uncertainties
		The Plan provides for various investment options in stocks and other investment securities. Investment securities, in general, are exposed to various risks such as, significant world events, interest rate, credit, and overall market volatility. The plan invests in securities with contractual cash flows, such as asset backed securities, collateralized mortgage obligations and commercial mortgage backed securities, including securities backed by subprime mortgage loans. The value, liquidity and related income of these securities are sensitive to changes in economic conditions, including real estate value, delinquencies or defaults, or both, and may be adversely affected by shifts in the market’s perception of the issuers and changes in interest rates. Due to the level of risk associated with certain investment securities, it is reasonably possible that changes in the values of investment securities will occur in the near term and that such changes could materially affect participants’ account balances and the amounts reported in the statements of net assets available for plan benefits and the statements of changes in net assets available for plan benefits.
		The Plan has a concentration of investments in ProLogis common stock. A change in the value of the Company common stock could cause the value of the Plan’s net assets available for plan benefits to change due to this concentration.
(8)		Subsequent Events Evaluation
		Management has evaluated the need for disclosures and/or adjustments resulting from subsequent events through the date these financial statements were issued. The evaluation determined that there were no subsequent events that necessitated disclosure and/or adjustments.

Schedule 1

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401(k) SAVINGS PLAN

Schedule H, Line 4i — Schedule of Assets (Held at End of Year)

December 31, 2009

Identity of party involved /
Description of asset		Current Value
ProLogis common stock*		$	5,120,110
Common Collective Trust:
Vanguard Retirement Savings Trust*+			6,738,241
Mutual Funds:
Allianz CCM Emerging Companies Fund*			62,122
Allianz CCM Mid-Cap Fund*			130,242
American Beacon International Equity Fund*			188,734
Ariel Appreciation Fund*			61,468
Artio Int’l Eqty A			830,797
Artisan International Fund*			241,049
Aston ABN AMRO Growth Fund*			162,667
Cohen & Steers Realty Shares*			335,324
Davis New York Venture Fund*			1,236,778
Harbor Capital Appreciation Fund*			1,688,285
Hotchkis and Wiley Mid-Cap Value Fund*			410,768
MainStay ICAP Equity Fund*			408,052
PIMCO Total Return Fund*			4,115,887
Third Avenue Small-Cap Value Fund*			467,253
Turner Mid-Cap Growth Fund*			241,910
Turner Small-Cap Growth Fund*			148,611
Vanguard 500 Index Fund Investor Shares*			5,870,293
Vanguard Balanced Index Fund Investor Shares*			1,924,775
Vanguard Growth Index Fund Investor Shares*			3,860,728
Vanguard Intermediate-Term Bond Index Fund*			1,200,889
Vanguard Mid-Cap Index Fund*			782,899
Vanguard Prime Money Mkt			4,081
Vanguard REIT Index Fund*			834,488
Vanguard Small-Cap Growth Index Fund*			1,323,032
Vanguard Small-Cap Value Index Fund*			814,630
Vanguard Target Retirement 2005 Fund*			427,693
Vanguard Target Retirement 2015 Fund*			289,332
Vanguard Target Retirement 2025 Fund*			2,788,938
Vanguard Target Retirement 2035 Fund*			1,548,915
Vanguard Target Retirement 2045 Fund*			920,515
Vanguard Target Retirement Income Fund*			298,126
Vanguard Total International Stock Index Fund*			2,106,648
Vanguard Value Index Fund Investor Shares*			1,634,214
Wells Fargo Advantage C&B Mid Cap Value Portfolio D Shares			58,657
Total mutual funds			37,418,800
Self Directed Brokerage Account — VGI Brokerage Option:*			395,262
Participant loans, 4.25% to 9.25%, maturing through August 2039			558,416
Total investments		$	50,230,829

See accompanying Report of Independent Registered Public Accounting Firm.

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the Management Development and Compensation Committee of the ProLogis 401(k) Savings Plan has duly caused this annual report to be signed on its behalf by the undersigned hereunto duly authorized.