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                                                                    Exhibit 4.25


Unless this certificate is presented by an authorized representative of The
Depository Trust Company, a New York corporation ("DTC"), to the Company (as
defined below) or its agent for registration of transfer, exchange, or payment,
and any certificate issued is registered in the name of Cede & Co. or in such
other name as is requested by an authorized representative of DTC (and any
payment is made to Cede & Co. or to such other entity as is requested by an
authorized representative of DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR
VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered
owner hereof, Cede & Co., has an interest herein.

REGISTERED                                                     PRINCIPAL AMOUNT
No.: 1                                                             $125,000,000

CUSIP No.: 743410AB8

                                 PROLOGIS TRUST
                              7.00% NOTE DUE 2003

         PROLOGIS TRUST, a real estate investment trust organized and existing
under the laws of the State of Maryland (hereinafter called the "Company," which
term shall include any successor under the Indenture hereinafter referred to),
for value received, hereby promises to pay to CEDE & CO., or registered assigns,
upon presentation, the principal sum of ONE HUNDRED TWENTY FIVE MILLION DOLLARS
on October 1, 2003 and to pay interest on the outstanding principal amount
thereon from October 9, 1998 or from the most recent Interest Payment Date to
which interest has been paid or duly provided for, semi-annually in arrears on
April 1 and October 1 in each year, commencing on April 1, 1999, at the rate of
7.00% per annum, until the entire principal hereof is paid or made available for
payment. The interest so payable, and punctually paid or duly provided for on
any Interest Payment Date will, as provided in the Indenture, be paid to the
Person in whose name this Security (or one or more Predecessor Securities) is
registered at the close of business on the Regular Record Date for such interest
which shall be the March 15 or September 15 (whether or not a Business Day), as
the case may be, next preceding such Interest Payment Date. Any such interest
not so punctually paid or duly provided for shall forthwith cease to be payable
to the Holder on such Regular Record Date, and may either be paid to the Person
in whose name this Security (or one or more Predecessor Securities) is
registered at the close of business on a Special Record Date for the payment of
such Defaulted Interest to be fixed by the Trustee, notice whereof shall be
given to Holders of Securities of this series not more than 15 days and not less
than 10 days prior to such



<PAGE>   2


Special Record Date, or may be paid at any time in any other lawful manner not
inconsistent with the requirements of any securities exchange on which the
Securities may be listed, and upon such notice as may be required by such
exchange, all as more fully provided in the Indenture. Payment of the principal
of, Make-Whole Amount, if any, on, and interest on this Security will be made at
the office or agency of the Company maintained for that purpose in the City of
Boston, Commonwealth of Massachusetts, or elsewhere as provided in the
Indenture, in such coin or currency of the United States of America as at the
time of payment is legal tender for payment of public and private debts;
provided, however, that at the option of the Company payment of interest may be
made by (i) check mailed to the address of the Person entitled thereto as such
address shall appear in the Security Register or (ii) transfer to an account of
the Person entitled thereto located inside the United States.

         Each Security of this series is one of a duly authorized issue of
securities of the Company (herein called the "Securities"), issued and to be
issued in one or more series under an Indenture, dated as of March 1, 1995
(herein called the "Indenture"), between the Company and State Street Bank and
Trust Company (herein called the "Trustee," which term includes any successor
trustee under the Indenture with respect to the series of which this Security is
a part), to which Indenture and all indentures supplemental thereto reference is
hereby made for a statement of the respective rights, limitations of rights,
duties and immunities thereunder of the Company, the Trustee and the Holders of
the Securities and of the terms upon which the Securities are, and are to be,
authenticated and delivered. This Security is one of the series designated on
the first page hereof, limited in aggregate principal amount to $125,000,000.

         Securities of this series may be redeemed at any time at the option of
the Company, in whole or in part, at a redemption price equal to the sum of (i)
the principal amount of the Securities being redeemed plus accrued interest
thereon to the Redemption Date and (ii) the Make-Whole Amount, if any, with
respect to such Securities.

         The following definitions apply with respect to any redemption of the
Securities of this series at the option of the Company:

                  "Make-Whole Amount" means, in connection with any optional
redemption or accelerated payment of any Security, the excess, if any, of (i)
the aggregate present value as of the date of such redemption or accelerated
payment of each dollar of principal being redeemed or paid and the amount of
interest (exclusive of interest accrued to the date of redemption or accelerated
payment) that would have been payable in respect of such dollar if such
redemption or accelerated payment had not been made, determined by discounting,
on a semiannual basis, such principal and interest at the Reinvestment Rate
(determined on the third Business Day preceding the date such notice of
redemption is given or declaration of acceleration is made) from the respective
dates on which such principal and interest

                                        2

<PAGE>   3


would have been payable if such redemption or accelerated payment had not been
made, over (ii) the aggregate principal amount of the Securities being redeemed
or paid.

                  "Reinvestment Rate" means .25% (one-quarter of one percent)
plus the arithmetic mean of the yields under the respective headings "This Week"
and "Last Week" published in the Statistical Release under the caption "Treasury
Constant Maturities" for the maturity (rounded to the nearest month)
corresponding to the remaining life to maturity, as of the payment date of the
principal being redeemed or paid. If no maturity exactly corresponds to such
maturity, yields for the two published maturities most closely corresponding to
such maturity shall be calculated pursuant to the immediately preceding sentence
and the Reinvestment Rate shall be interpolated or extrapolated from such yields
on a straight-line basis, rounding in each of such relevant periods to the
nearest month. For the purposes of calculating the Reinvestment Rate, the most
recent Statistical Release published prior to the date of determination of the
Make-Whole Amount shall be used.

                  "Statistical Release" means the statistical release designated
"H.15(519)" or any successor publication which is published weekly by the
Federal Reserve System and which establishes yields on actively traded United
States government securities adjusted to constant maturities, or, if such
statistical release is not published at the time of any determination under the
Indenture, then such other reasonably comparable index which shall be designated
by the Company.

        The Indenture contains provisions for defeasance at any time of (a) the
entire indebtedness of the Company on this Security and (b) certain restrictive
covenants and the related defaults and Events of Default applicable to the
Company, in each case, upon compliance by the Company with certain conditions
set forth in the Indenture, which provisions apply to this Security.

        If an Event of Default with respect to Securities of this series shall
occur and be continuing, the principal of, and the Make-Whole Amount, if any,
on, the Securities of this series may be declared due and payable in the manner
and with the effect provided in the Indenture.

        As provided in and subject to the provisions of the Indenture, unless
the principal of all of the Securities of this series at the time Outstanding
shall already have become due and payable, the Holder of this Security shall not
have the right to institute any proceeding with respect to the Indenture or for
the appointment of a receiver or trustee or for any other remedy thereunder,
unless such Holder shall have previously given the Trustee written notice of a
continuing Event of Default with respect to the Securities of this series, the
Holders of not less than 25% in principal amount of the Securities of this
series at the time Outstanding shall have made written request to the Trustee to
institute proceedings in respect of such Event of Default as Trustee and offered
the Trustee reasonable indemnity

                                        3

<PAGE>   4

and the Trustee shall not have received from the Holders of a majority in
principal amount of Securities of this series at the time Outstanding a
direction inconsistent with such request, and the Trustee shall have failed to
institute any such proceeding for 60 days after receipt of such notice, request
and offer of indemnity. The foregoing shall not apply to any suit instituted by
the Holder of this Security for the enforcement of any payment of principal
hereof or any interest on or after the respective due dates expressed herein.

        The Indenture permits, with certain exceptions as therein provided, the
amendment thereof and the modification of the rights and obligations of the
Company and the rights of the Holders of the Securities of each series to be
affected under the Indenture at any time by the Company and the Trustee with the
consent of the Holders of not less than a majority in principal amount of the
Outstanding Securities of each series of Securities then Outstanding affected
thereby. The Indenture also contains provisions permitting the Holders of
specified percentages in principal amount of the Securities of each series at
the time Outstanding, on behalf of the Holders of all Securities of such series,
to waive compliance by the Company with certain provisions of the Indenture and
certain past defaults under the Indenture and their consequences. Any such
consent or waiver by the Holder of this Security shall be conclusive and binding
upon such Holder and upon all future Holders of this Security and of any
Security issued upon the registration of transfer hereof or in exchange herefor
or in lieu hereof, whether or not notation of such consent or waiver is made
upon this Security.

        No reference herein to the Indenture and no provision of this Security
or of the Indenture shall alter or impair the obligation of the Company, which
is absolute and unconditional, to pay the principal of, Make-Whole Amount, if
any, on, and interest on this Security at the times, place and rate, and in the
coin or currency, herein prescribed.

        As provided in the Indenture and subject to certain limitations therein
set forth, the transfer of this Security is registrable in the Security
Register, upon surrender of this Security for registration of transfer at the
office or agency of the Company in any Place of Payment where the principal of,
Make-Whole Amount, if any, on, and interest on this Security are payable duly
endorsed by, or accompanied by a written instrument of transfer in form
satisfactory to the Company and the Security Registrar duly executed by, the
Holder hereof or his attorney duly authorized in writing, and thereupon one or
more new Securities of this series, of authorized denominations and for the same
aggregate principal amount, will be issued to the designated transferee or
transferees.

        The Securities of this series are issuable only in registered form
without coupons in denominations of $1,000 and any integral multiple thereof. As
provided in the Indenture and subject to certain limitations therein set forth,
Securities of this series are exchangeable for a like aggregate principal amount
of Securities of this series of a different authorized denomination, as
requested by the Holder surrendering the same.

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        No service charge shall be made for any such registration of transfer or
exchange, but the Company may require payment of a sum sufficient to cover any
tax or other governmental charge payable in connection therewith.

        Prior to due presentment of this Security for registration of transfer,
the Company, the Trustee and any agent of the Company or the Trustee may treat
the Person in whose name this Security is registered as the owner hereof for all
purposes, whether or not this Security be overdue, and neither the Company, the
Trustee nor any such agent shall be affected by notice to the contrary.

        No recourse under or upon any obligation, covenant or agreement
contained in the Indenture or in this Security, or because of any indebtedness
evidenced thereby, shall be had against any promoter, as such, or against any
past, present or future shareholder, officer or trustee, as such, of the Company
or of any successor, either directly or through the Company or any successor,
under any rule of law, statute or constitutional provision or by the enforcement
of any assessment or by any legal or equitable proceeding or otherwise, all such
liability being expressly waived and released by the acceptance of this Security
by the Holder thereof and as part of the consideration for the issue of the
Securities of this series.

        All terms used in this Security which are defined in the Indenture shall
have the meanings assigned to them in the Indenture.

        THE INDENTURE AND THE SECURITIES, INCLUDING THIS SECURITY, SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAW OF THE STATE OF NEW YORK.

        Pursuant to a recommendation promulgated by the Committee on Uniform
Security Identification Procedures, the Company has caused "CUSIP" numbers to be
printed on the Securities of this series as a convenience to the Holders of such
Securities. No representation is made as to the correctness or accuracy of such
CUSIP numbers as printed on the Securities, and reliance may be placed only on
the other identification numbers printed hereon.



                     [This space intentionally left blank.]


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        Unless the certificate of authentication hereon has been executed by or
on behalf of the Trustee by manual signature, this Security shall not be
entitled to any benefit under the Indenture or be valid or obligatory for any
purpose.

        IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed by the undersigned officer.


                                         PROLOGIS TRUST



                                         By:
                                            -----------------------------------
                                            Name:  Jeffrey A. Klopf
                                            Title: Secretary






Attest


By:
   -------------------------------------
   Name:  Lucinda G. Marker
   Title: Assistant Secretary

Dated: October ___, 1998



TRUSTEE'S CERTIFICATE OF AUTHENTICATION:

        This is one of the Securities of the series designated therein referred
to in the within-mentioned Indenture.

STATE STREET BANK AND TRUST
  COMPANY, as Trustee


BY:
   -----------------------------------------
   Authorized Officer




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================================================================================

                                 ASSIGNMENT FORM

                   FOR VALUE RECEIVED, the undersigned hereby
                        sells, assigns and transfers unto


         PLEASE INSERT SOCIAL
         SECURITY OR OTHER IDENTIFYING
         NUMBER OF ASSIGNEE

=============================================


=============================================



--------------------------------------------------------------------------------
              (Please Print or Typewrite Name and Address including
                              Zip Code of Assignee)



--------------------------------------------------------------------------------
the within Security of ProLogis Trust and hereby does irrevocably constitute and
appoint

---------------------------------------------------------------------- Attorney
to transfer said Security on the books of the within named Company with full
power of substitution in the premises.


Dated:
      -----------------------           ----------------------------------------



                                             -----------------------------------



NOTICE: The signature to this assignment must correspond with the name as it
appears on the first page of the within Security in every particular, without
alteration or enlargement or any change whatever.

================================================================================

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