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"AMB and ProLogis: A Momentous Proposition" provides a sequel to the story of AMB's experience in the Global Financial Crisis (GFC) that is outlined in case RE134: AMB Property Corporation: Navigating Treacherous Waters. It is now October 2010, the world economy is recovering from the GFC, and AMB Property Corporation (AMB) encounters an unusual opportunity. It has the chance to acquire ProLogis (PLD), AMB's top (and much larger) competitor. Ahead of the GFC, PLD had borrowed heavily to fund risky speculative development; now, post-GFC, the consequences of PLD's hunger for return persist, and the company is no longer the darling it once was among REIT investors. PLD's ailing stock price has created a possibility that the top two industrial REITs could merge (together ""NewCo"") to become the world's largest industrial REIT. NewCo would control over $44 billion of assets, boast a global footprint of nearly 600 million square feet of real estate, and own a significant presence across the world's prime logistics corridors. Hamid Moghadam, AMB's co-founder and Chief Executive Officer, sees significant benefits from a merger. He believes savings in corporate G&A, coupled with lowered financing costs, can exceed $100 million per year, and anticipates the deal to generate further synergies by deepening NewCo's customer relationships and providing a valuation boost for PLD's fund management business. However, Moghadam also recognizes the complexities to executing a successful deal. AMB would need to absorb PLD's lower credit rating, higher debt load (which came with a higher interest rate), and assets in lower quality markets that AMB had long avoided. Moghadam also knows that the starkly different cultures at AMB and PLD would make the integration process challenging, while also complicating the negotiation of deal parameters-especially whether to pursue a ""merger of equals"" or a traditional acquisition. Moghadam knows that AMB needs to pursue an opportunity with

In this fictional case, Alex, a real estate developer, is at a crossroads in the midst of the coronavirus pandemic. His company is a year away from completing a 700,000-square-foot commercial office complex in downtown Moscow, but construction has paused, and the economic future is uncertain. One of his partners, who's with a Russian company, proposes that they cut their losses and sell to a company in Kazakhstan. The other, a managing director with a large investment portfolio, thinks they can ride out the crisis. Alex has put six years into this project; now he must decide how to proceed. This fictional case study by Cody Evans and Chris Mahowald features expert commentary by Sheila Botting and Brian Patterson.

In this fictional case, Alex, a real estate developer, is at a crossroads in the midst of the coronavirus pandemic. His company is a year away from completing a 700,000-square-foot commercial office complex in downtown Moscow, but construction has paused, and the economic future is uncertain. One of his partners, who's with a Russian company, proposes that they cut their losses and sell to a company in Kazakhstan. The other, a managing director with a large investment portfolio, thinks they can ride out the crisis. Alex has put six years into this project; now he must decide how to proceed. This fictional case study by Cody Evans and Chris Mahowald features expert commentary by Sheila Botting and Brian Patterson.

In this fictional case, Alex, a real estate developer, is at a crossroads in the midst of the coronavirus pandemic. His company is a year away from completing a 700,000-square-foot commercial office complex in downtown Moscow, but construction has paused, and the economic future is uncertain. One of his partners, who's with a Russian company, proposes that they cut their losses and sell to a company in Kazakhstan. The other, a managing director with a large investment portfolio, thinks they can ride out the crisis. Alex has put six years into this project; now he must decide how to proceed. This fictional case study by Cody Evans and Chris Mahowald features expert commentary by Sheila Botting and Brian Patterson.

Melinda Ellis Evers, a Bay Area native and Stanford GSB alumna, founded Ellis Partners (Ellis), a commercial real estate investment and development firm in 1993 together with her father and brother. One of Ellis' projects was the redevelopment of an obsolete manufacturing facility located in Emeryville, California into Class A office / R&D space - Emery Tech - in 1998. After a successful nine-year investment period, Evers spotted another development opportunity to convert the remaining unused space into new office space to further take advantage of the vibrant office leasing environment in the Bay Area. Together with its new equity partner CarVal, Ellis successfully closed a recapitalization deal and put in additional new equity to fund the construction. However, just as Emery Tech's new space became ready for tenants in late 2007, the global financial markets collapsed and the demand for office space evaporated. To make things worse, one of Emery Tech's key tenants, Washington Mutual Bank, had gone into receivership and notified Ellis in December 2008 that it was invoking an obscure provision of U.S. banking regulation to terminate its lease. Emery Tech was suddenly underwater. Evers was faced with the decision to walk away from the project and lose the original investment made only two years ago or put in additional capital to bring in a new tenant - Clif Bar - amid a rapidly deepening global financial crisis.

Brian Patterson was the lead developer of a large office project in Moscow when the global financial crisis hit. His project, which had looked like it would be jaw-droppingly profitable just months before, was suddenly thrown into turmoil, and he faced trouble on all fronts. His local development partner wanted to sell in order to shore up its failing balance sheet, his world-class anchor tenant suddenly reneged on its pre-lease agreement, the contractor was running months behind schedule, and the project's bank was looking for any excuse to pull the construction loan. Just months earlier, the project pro forma had projected hundreds of millions of dollars in profit. Suddenly there were serious questions around whether the project could even be completed. And if it could, what rent and cap rate values could be assumed to determine if it made sense to continue development? Patterson needed to make some assumptions to determine whether or not to accept a sale offer that had been drudged up by his local partner. And if he decided to turn down the sale offer, he needed to find a way forward through a maze of (i) diverging interests amongst his partners and (ii) project development problems. As the economic and financial system faced global turmoil and threatened collapse, Patterson had to decide whether to keep developing the project - at significant risk to both the project and his personal career - or to sell for a modest profit and live to fight another day.

In March 2008, a group of investors considered purchasing 8,300 residential lots in 11 states from one of the largest U.S. homebuilders, at a price of 10 cents on the dollar. The deal would also involve purchasing a partially-built condominium complex, also at a substantial mark-down from the amount already invested. This case describes the residential real estate development business and the role of land in homebuilding. It describes the excesses leading to the housing crisis in 2008. The case is based on a real situation, but company names and some details have been changed.