ProLogis Halting All New Development

DENVER-ProLogis revealed some jarring news Wednesday morning. The distribution REIT said Jeff Schwartz is resigning and the company is halting all new development, slashing its dividend and cutting overhead by 20% to 25% as it restructures to deal with market conditions. In advance of the company’s investor meeting Thursday to “address current market conditions,” multiple analysts weighed in on what it all means.

Mike Mueller of JP Morgan Securities says “PLD may finally be moving from a bull market strategy to a bear market strategy that focuses more on liquidity rather than earnings momentum. Considering the stock’s recent performance, these look like appropriate actions at first glance.”

Given Schwartz’ role in the company’s growth, Deutsche Bank analyst Lou Taylor called his exit “stunning,” adding that “We interpret the change as a difference of opinion about future strategy. The board must believe a halt of all construction is required. Whether Mr. Schwartz disagreed and resigned or the board felt new leadership was required is unknown at this point.”