"We're very happy with earnings for quarter," Rakowich tells GlobeSt.com. "We had very strong perfomance in a weak economy. And we had ancicipated our earnings would be down a bit."

He notes the company will be investing $1 billion to $1.5 billion in China over the next three to four years, and and equal amount in Japan during that time period. Conventional economic wisdom has it that China will grow in future decades, but Japan is something less expected. The depressed economy in Japan plans to the strength of ProLogis, he says.

"To a large degree that is a plus for us," he tells GlobeSt.com. "One of the reasons their economy is so bad, because they have an inefficient distribution network. It costs a lot more to move goods in Japan than it does in the U.S. We see the new for new modern, efficient warehouses in Japan that have not existed before."

As earlier reported in GlobeSt.com, revenues fell to $159.94 million from $172.26 million and its net income fell to $46.88 million from $63.18 million. Net earnings per diluted share were 21 cents per share, compared with 31 cents a year earlier. The REIT's FFO fell to $100.6 million from $106.2 million, which equates to 55 cents per share of FFO from 59 cents per share in the first quarter of 2002.

Despite the downturn, the stock is hovering close to its all-time high of $27.15. And it still pays a 5.5% dividend, which is 2.5 times the average dividend on the S&P 500, Rakowich says.

First-quarter results reflect the dilution from last year's sale of the majority of the company's temperature-controlled businesses and earnings also were affected by net foreign currency losses."The currency fluctuations hit our earnings per share, but that can always turn around quickly and we'd have a sterling quarter," Rakowich tells GlobeSt..com.

And he notes that the sale of its refrigerated units gives ProLogis a lot of cash to play with. ProLogis sold about $400 million in the refrigerated units, including a $272 million deal with London-based Peninsular & Oriental Steam Navigation, the parent of the Denver Tech Center and the Meridian International Business Park in Douglas County.

The REIT is building a 400,000-sf parts distribution facility for General Motors on 182 acres it recently purchased in Aurora, CO.Eventually, the park will have 2.9 million sf., with a completed value estimated at $100 million in today's dollars.