Record 228 million square feet of leases signed in 2025
Further expands power capacity to support data center growth
SAN FRANCISCO, Jan. 21, 2026 /PRNewswire/ -- Prologis, Inc. (NYSE: PLD) today announced the following results for the quarter and fiscal year ended December 31, 2025:
- Net earnings per diluted share was $1.49 for the quarter and $3.56 for the year compared with $1.37 and $4.01 for the corresponding periods in 2024.
- Core funds from operations (Core FFO)* per diluted share was $1.44 for the quarter and $5.81 for the year compared with $1.50 and $5.56 for the corresponding periods in 2024.
- Core FFO, excluding Net Promote Income (Expense)* per diluted share was $1.46 for the quarter and $5.86 for the year compared with $1.42 and $5.53 for the corresponding periods in 2024.
"2025 was a record year for lease signings, setting the business up with strong momentum for 2026," said Daniel S. Letter, chief executive officer of Prologis. "Customers are making long-term decisions with greater conviction, and we are meeting that demand with a platform that brings logistics, digital infrastructure and energy together at a global scale."
"The company delivered excellent fourth quarter and full year results," said Timothy D. Arndt, chief financial officer of Prologis. "As we look ahead, embedded growth, disciplined investment activity and unmatched global capital access give us confidence in our earnings growth outlook for 2026 and beyond."
OPERATING PERFORMANCE
Owned & Managed 4Q25
Average Occupancy 95.3 %
Period End Occupancy 95.8 %
Leases Commenced (Operating and Development Portfolio) 43.8 MSF
Retention 77.7 %
Prologis Share 4Q25
Average Occupancy 95.2 %
Cash Same Store NOI* 5.7 %
Net Effective Rent Change 43.8 %
Cash Rent Change 27.3 %
DEPLOYMENT ACTIVITY
During the quarter, the company expanded its data center power pipeline to 5.7 gigawatts of capacity secured or in advanced stages of procurement and surpassed its 1 gigawatt target for installed solar and battery storage.
Prologis Share 4Q25
Acquisitions
$517M
Weighted avg stabilized cap rate (excluding other real estate) 5.2 %
Development Stabilizations
$539M
Estimated weighted avg yield 6.4 %
Estimated weighted avg margin 17.6 %
Estimated value creation
$95M
% Build-to-suit 37.5 %
Development Starts
$1,019M
Estimated weighted avg yield 6.1 %
Estimated weighted avg margin 20.3 %
Estimated value creation
$207M
% Build-to-suit 47.9 %
Total Dispositions and Contributions
$1,885M
Weighted avg stabilized cap rate (excluding land and other real estate) 5.0 %
BALANCE SHEET STRENGTH & LIQUIDITY
During the quarter, the company:
- Closed, together with its co-investment ventures, an aggregate of $3.0 billion of debt at a weighted average interest rate of 3.1% and a weighted average term of 7.2 years.
As of quarter-end:
- Total available liquidity was approximately $7.6 billion.
- Debt-to-Adjusted EBITDA* was 5.3x and debt as a percentage of total market capitalization was 24.6%.
- The weighted average interest rate on the company's share of total debt was 3.3%, with a weighted average term of 8.2 years.
- Forecasted earnings for 2026, 2027 and 2028 are 98%, 98% and 97%, respectively, in USD or hedged through derivative contracts and 96% of Prologis' equity was in USD.
2026 GUIDANCE
Prologis' guidance for net earnings is included in the table below as well as guidance for Core FFO*, which are reconciled in our supplemental information.
2026 GUIDANCE
Earnings (per diluted share)
Net earnings attributable to common stockholders
$3.70 to $4.00
Core FFO attributable to common stockholders/unitholders*
$6.00 to $6.20
Core FFO attributable to common stockholders/unitholders,
$6.05 to $6.25
excluding Net Promote Income (Expense)*
Operations -
Prologis Share
Average occupancy 94.75% to
95.75%
Cash Same Store NOI* 5.75% to 6.75%
Net Effective Same Store NOI* 4.25% to 5.25%
Strategic Capital (in millions)
Strategic Capital revenue, excluding promote revenue
$650 to $670
Net Promote Income (Expense)(1) $(50)
G&A (in millions)
General & administrative expenses
$500 to $520
Capital Deployment - Prologis Share (in millions)(2)
Development stabilizations
$2,250 to $2,750
Development starts
$3,000 to $4,000
Acquisitions
$1,000 to $1,500
Contributions
$1,500 to $2,000
Dispositions
$1,750 to $2,250
Realized development gains
$400 to $600
1. Net promote expense relates to amortization of stock compensation issued to employees related to promote income recognized in
prior periods.
2.
Inclusive of data centers.
* This is a non-GAAP financial measure. See the Notes and Definitions in our supplemental information for further explanation and
a reconciliation to the most directly comparable GAAP measure.
The earnings guidance described above includes potential gains recognized from real estate transactions but excludes any future or potential foreign currency or derivative gains or losses as our guidance assumes constant foreign currency rates. In reconciling from net earnings to Core FFO*, Prologis makes certain adjustments, including but not limited to our share of real estate depreciation and amortization expense, gains (losses) recognized from real estate transactions and early extinguishment of debt, impairment charges, deferred taxes and unrealized gains or losses on foreign currency or derivative activity. The difference between the company's Core FFO* and net earnings guidance relates predominantly to these items. Please refer to our quarterly Supplemental Information, which is available on our Investor Relations website at https://ir.prologis.com and on the SEC's website at www.sec.gov for a definition of Core FFO* and other non-GAAP measures used by Prologis, along with reconciliations of these items to the closest GAAP measure for our results and guidance.
January 21, 2026, CALL DETAILS
The call will take place on Wednesday, January 21, 2026, at 9:00 a.m. PT/12:00 p.m. ET. To access a live broadcast of the call, please dial +1 (877) 897-2615 (toll-free from the United States and Canada) or +1 (201) 689-8514 (from all other countries). A live webcast can be accessed from the Investor Relations section of www.prologis.com.
A telephonic replay will be available January 21 - February 4 at +1 (877) 660-6853 (from the United States and Canada) or +1 (201) 612-7415 (from all other countries) using access code 13757425. The webcast replay will be posted in the Investor Relations section of www.prologis.com under "Events & Presentations."
ABOUT PROLOGIS
The world runs on logistics. At Prologis, we don't just lead the industry, we define it. We create the intelligent infrastructure that powers global commerce, seamlessly connecting the digital and physical worlds. From agile supply chains to clean energy solutions, our ecosystems help your business move faster, operate smarter and grow sustainably. With unmatched scale, innovation and expertise, Prologis is a category of one-not just shaping the future of logistics but building what comes next. Learn more at Prologis.com.
FORWARD-LOOKING STATEMENTS
The statements in this document that are not historical facts are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements are based on current expectations, estimates and projections about the industry and markets in which we operate as well as management's beliefs and assumptions. Such statements involve uncertainties that could significantly impact our financial results. Words such as "expects," "anticipates," "intends," "plans," "believes," "seeks," and "estimates" including variations of such words and similar expressions are intended to identify such forward-looking statements, which generally are not historical in nature. All statements that address operating performance, events or developments that we expect or anticipate will occur in the future--including statements relating to rent and occupancy growth, acquisition and development activity, including data center developments and power procurement related thereto, contribution and disposition activity, general conditions in the geographic areas where we operate, expectations regarding new lines of business, our debt, capital structure and financial position, our ability to earn revenues from co-investment ventures, form new co-investment ventures and the availability of capital in existing or new co-investment ventures--are forward-looking statements. These statements are not guarantees of future performance and involve certain risks, uncertainties and assumptions that are difficult to predict. Although we believe the expectations reflected in any forward-looking statements are based on reasonable assumptions, we can give no assurance that our expectations will be attained and, therefore, actual outcomes and results may differ materially from what is expressed or forecasted in such forward-looking statements. Some of the factors that may affect outcomes and results include, but are not limited to: (i) international, national, regional and local economic and political climates and conditions; (ii) changes in global financial markets, interest rates and foreign currency exchange rates; (iii) increased or unanticipated competition for our properties; (iv) risks associated with acquisitions, dispositions and development of properties, including the integration of the operations of significant real estate portfolios; (v) maintenance of Real Estate Investment Trust status, tax structuring and changes in income tax laws and rates; (vi) availability of financing and capital, the levels of debt that we maintain and our credit ratings; (vii) risks related to our investments in our co-investment ventures, including our ability to establish new co-investment ventures; (viii) risks of doing business internationally, including currency risks; (ix) environmental uncertainties, including risks of natural disasters; and (x) those additional factors discussed in reports filed with the Securities and Exchange Commission by us under the heading "Risk Factors." We undertake no duty to update any forward-looking statements appearing in this document except as may be required by law.
dollars in millions, except per share/unit data Three Months Ended December 31, Twelve Months Ended December 31,
2025 2024 2025 2024
Rental and other revenues $2,099 $1,947 $8,198 $7,530
Strategic capital revenues 154 254 592 672
Total revenues 2,253 2,201 8,790 8,202
Net earnings attributable to common stockholders 1,398 1,277 3,322 3,726
Core FFO attributable to common stockholders/unitholders* 1,384 1,435 5,561 5,305
AFFO attributable to common stockholders/unitholders* 1,152 1,303 4,335 4,422
Adjusted EBITDA attributable to common stockholders/unitholders* 2,002 2,112 7,431 7,162
Estimated value creation from development stabilizations - Prologis Share 95 298 568 773
Common stock dividends and common limited partnership unit distributions 968 917 3,866 3,667
Per common share - diluted:
Net earnings attributable to common stockholders $1.49 $1.37 $3.56 $4.01
Core FFO attributable to common stockholders/unitholders* 1.44 1.50 5.81 5.56
Core FFO attributable to common stockholders/unitholders, excluding Net Promote
Income (Expense)* 1.46 1.42 5.86 5.53
Business line reporting:
Real estate* 1.39 1.34 5.58 5.25
Strategic capital* 0.05 0.16 0.23 0.31
Core FFO attributable to common stockholders/unitholders* 1.44 1.50 5.81 5.56
Realized development gains, net of taxes* 0.18 0.29 0.23 0.45
Dividends and distributions per common share/unit 1.01 0.96 4.04 3.84
*This is a non-GAAP financial measure. Please see our Notes and Definitions for further explanation.
in thousands December 31, 2025 September 30, 2025 December 31, 2024
Assets:
Investments in real estate properties:
Operating properties $80,561,020 $80,688,903 $78,279,353
Development portfolio 3,019,009 2,748,411 2,829,613
Land 4,888,153 5,095,671 4,453,522
Other real estate investments 6,661,174 6,504,491 5,683,688
95,129,356 95,037,476 91,246,176
Less accumulated depreciation 14,729,149 14,345,033 12,758,159
Net investments in real estate properties 80,400,207 80,692,443 78,488,017
Investments in and advances to unconsolidated entities 11,093,936 10,543,057 10,079,448
Assets held for sale or contribution 203,344 358,851 248,511
Net investments in real estate 91,697,487 91,594,351 88,815,976
Cash and cash equivalents 1,145,647 1,186,022 1,318,591
Other assets 5,881,122 5,560,768 5,194,342
Total assets $98,724,256 $98,341,141 $95,328,909
Liabilities and Equity:
Liabilities:
Debt $35,037,073 $35,302,901 $30,879,263
Accounts payable, accrued expenses and other liabilities 5,933,175 5,826,131 5,832,876
Total liabilities 40,970,248 41,129,032 36,712,139
Equity:
Stockholders' equity 53,193,178 52,635,541 53,951,138
Noncontrolling interests 3,316,713 3,328,104 3,323,047
Noncontrolling interests - limited partnership unitholders 1,244,117 1,248,464 1,342,585
Total equity 57,754,008 57,212,109 58,616,770
Total liabilities and equity $98,724,256 $98,341,141 $95,328,909
Three Months Ended Twelve Months Ended
December 31, December 31,
in thousands, except per share amounts 2025 2024 2025 2024
Revenues:
Rental $2,092,107 $1,937,507 $8,158,904 $7,514,705
Strategic capital 153,701 253,386 592,353 671,907
Development management and other 6,904 9,753 38,870 14,998
Total revenues 2,252,712 2,200,646 8,790,127 8,201,610
Expenses:
Rental 503,222 438,468 1,964,137 1,765,385
Strategic capital 75,553 81,167 270,517 291,856
General and administrative 136,880 102,724 469,114 418,765
Depreciation and amortization 668,750 656,444 2,626,028 2,580,519
Other 15,950 7,673 46,029 47,044
Total expenses 1,400,355 1,286,476 5,375,825 5,103,569
Operating income before gains on real estate transactions, net $852,357 $914,170 $3,414,302 $3,098,041
Gains on dispositions of development properties and land, net 204,368 254,256 257,731 413,743
Gains on other dispositions of investments in real estate, net 569,753 252,830 685,831 904,136
Operating income $1,626,478 $1,421,256 $4,357,864 $4,415,920
Other income (expense):
Earnings from unconsolidated entities, net 134,113 94,065 402,531 353,623
Interest expense (260,453) (232,232) (1,002,344) (863,932)
Foreign currency, derivative and other gains (losses) and other income (expense), net 68,269 145,957 14,763 208,731
Gains (losses) on early extinguishment of debt, net (3,498) (3,498) 536
Total other income (expense) (61,569) 7,790 (588,548) (301,042)
Earnings before income taxes 1,564,909 1,429,046 3,769,316 4,114,878
Current income tax benefit (expense) (75,437) (67,910) (199,708) (145,782)
Deferred income tax benefit (expense) (7,257) (18,960) (4,309) (21,161)
Consolidated net earnings 1,482,215 1,342,176 3,565,299 3,947,935
Net earnings attributable to noncontrolling interests (49,020) (31,354) (156,064) (123,192)
Net earnings attributable to noncontrolling interests - limited partnership units (33,412) (31,969) (81,004) (93,108)
Net earnings attributable to controlling interests 1,399,783 1,278,853 3,328,231 3,731,635
Preferred stock dividends (1,556) (1,474) (5,882) (5,881)
Net earnings attributable to common stockholders $1,398,227 $1,277,379 $3,322,349 $3,725,754
Weighted average common shares outstanding - Diluted 958,019 954,080 956,832 953,590
Net earnings per share attributable to common stockholders - Diluted $1.49 $1.37 $3.56 $4.01
Three Months Ended Twelve Months Ended
December 31,
December 31,
in thousands 2025 2024 2025 2024
Net earnings attributable to common stockholders $1,398,227 $1,277,379 $3,322,349 $3,725,754
Add (deduct) NAREIT defined adjustments:
Real estate related depreciation and amortization 641,827 633,940 2,538,805 2,504,001
Gains on other dispositions of investments in real estate, net of taxes
(excluding development properties and land) (569,806) (248,705) (684,854) (899,270)
Adjustments related to noncontrolling interests 1,069 58 (47,819) (31,334)
Our proportionate share of adjustments related to unconsolidated entities 128,407 162,573 551,044 495,448
NAREIT defined FFO attributable to common stockholders/unitholders* $1,599,724 $1,825,245 $5,679,525 $5,794,599
Add (deduct) our modified adjustments:
Unrealized foreign currency, derivative and other losses (gains), net (29,701) (129,109) 125,247 (68,095)
Deferred income tax expense (benefit) 7,257 18,960 4,309 21,161
Adjustments related to noncontrolling interests (728) (728)
Our proportionate share of adjustments related to unconsolidated entities (26,146) (3,379) (29,094) (7,038)
FFO, as modified by Prologis attributable to common stockholders/unitholders* $1,550,406 $1,711,717 $5,779,259 $5,740,627
Add (deduct) Core FFO defined adjustments:
Gains on dispositions of development properties and land, net (204,368) (254,256) (257,731) (413,743)
Current income tax expense (benefit) on dispositions 22,136 18,311 25,738 24,876
Losses (gains) on early extinguishment of debt, net 3,498 3,498 (536)
Adjustments related to noncontrolling interests 11,448 6,166 14,944 6,244
Our proportionate share of adjustments related to unconsolidated entities 537 (47,276) (4,408) (52,529)
Core FFO attributable to common stockholders/unitholders* $1,383,657 $1,434,662 $5,561,300 $5,304,939
Add (deduct) AFFO defined adjustments:
Gains on dispositions of development properties and land, net 204,368 254,256 257,731 413,743
Current income tax benefit (expense) on dispositions (22,136) (18,311) (25,738) (24,876)
Straight-lined rents and amortization of lease intangibles (160,399) (174,317) (691,090) (644,606)
Property improvements (114,819) (137,613) (327,355) (386,481)
Turnover costs (148,620) (152,439) (562,197) (499,927)
Amortization of debt discount, financing costs and management contracts, net 25,358 20,695 90,668 80,028
Stock compensation amortization expense 43,812 67,445 185,466 231,747
Adjustments related to noncontrolling interests 8,377 14,558 66,005 53,432
Our proportionate share of adjustments related to unconsolidated entities (68,077) (5,681) (219,746) (106,433)
AFFO attributable to common stockholders/unitholders* $1,151,521 $1,303,255 $4,335,044 $4,421,566
*This is a non-GAAP financial measure. Please see our Notes and Definitions for further explanation.
Three Months Ended Twelve Months Ended
December 31, December 31,
in thousands 2025 2024 2025 2024
Net earnings attributable to common stockholders $1,398,227 $1,277,379 $3,322,349 $3,725,754
Gains on other dispositions of investments in real estate, net (excluding
development properties and land) (569,753) (252,830) (685,831) (904,136)
Depreciation and amortization expense 668,750 656,444 2,626,028 2,580,519
Interest charges 243,447 214,550 937,947 804,541
Current and deferred income tax expense, net 82,694 86,870 204,017 166,943
Net earnings attributable to noncontrolling interests -limited partnership units 33,412 31,969 81,004 93,108
NOI adjustments for real estate transactions (9,924) (16,970) 1,739 (4,043)
Preferred stock dividends 1,556 1,474 5,882 5,881
Unrealized foreign currency, derivative and other losses (gains), net (29,701) (129,109) 125,247 (68,095)
Stock compensation amortization expense 43,812 67,445 185,466 231,747
Losses (gains) on early extinguishment of debt, net 3,498 3,498 (536)
Adjustments related to noncontrolling interests (31,359) (32,590) (129,343) (126,308)
Our proportionate share of adjustments related to unconsolidated entities 167,572 206,904 752,702 656,825
Adjusted EBITDA attributable to common stockholders/unitholders* $2,002,231 $2,111,536 $7,430,705 $7,162,200
*This is a non-GAAP financial measure. Please see our Notes and Definitions for further explanation.
Adjusted EBITDA. We use Adjusted EBITDA attributable to common stockholders/unitholders ("Adjusted EBITDA"), a non-GAAP financial measure, as a measure of our operating performance. The most directly comparable GAAP measure is net earnings.
We believe Adjusted EBITDA provides relevant and useful information by offering insight into our operating performance before the effects of financing decisions, income taxes, and certain non-cash or non-recurring charges.
We calculate Adjusted EBITDA by beginning with consolidated net earnings attributable to common stockholders and removing the effect of:
(i) gains or losses from the disposition of investments in real estate (excluding
development properties and land);
(ii)
depreciation and amortization expense;
(iii)
impairment charges;
(iv)
interest charges;
(v)
current and deferred income taxes;
(vi)
preferred stock dividends;
(vii)
unrealized gains or losses on foreign currency and derivatives;
(viii)
stock compensation amortization expense;
(ix) gains from the revaluation of equity investments upon acquisition of a controlling
interest; and
(x) gains or losses on early extinguishment of debt and derivative contracts (including
cash charges).
We also include an adjustment to reflect a full period of NOI on the operating properties we acquire or stabilize during the quarter and to remove NOI on properties we dispose of during the quarter, assuming all transactions occurred at the beginning of the quarter. For properties we contribute, we make an adjustment to reflect NOI at the new ownership percentage for the full quarter.
We calculate Adjusted EBITDA based on our proportionate ownership share of both our unconsolidated entities and consolidated ventures. We reflect our share of Adjusted EBITDA measures for unconsolidated entities by applying our average ownership percentage for the period to the applicable adjusting items on an entity-by-entity basis. We reflect our share for consolidated ventures in which we do not own 100% of the equity by removing the noncontrolling interests share of the applicable adjustments based on our average ownership percentage for the applicable periods.
While we believe Adjusted EBITDA is an important supplemental measure, it should not be used alone as it excludes significant components of net earnings computed under GAAP and is therefore limited as an analytical tool. We do not use Adjusted EBITDA as an alternative measure to net earnings computed under GAAP or as an alternative to cash from operating activities computed under GAAP or as an indicator of our ability to fund our cash needs. Our computation of Adjusted EBITDA may not be comparable to EBITDA reported by other companies in both the real estate industry and other industries. We compensate for the limitations of Adjusted EBITDA by providing investors with financial statements prepared according to GAAP, along with this detailed discussion of Adjusted EBITDA and a reconciliation to Adjusted EBITDA from consolidated net earnings attributable to common stockholders.
Business Line Reporting is a non-GAAP financial measure. Core FFO and development gains are generated by our three lines of business: (i) real estate operations; (ii) strategic capital; and (iii) development. The real estate operations line of business represents total Prologis Core FFO, less the amount allocated to the strategic capital line of business. The amount of Core FFO allocated to the strategic capital line of business represents the third-party share of asset management fees and transactional fees that we earn from our consolidated and unconsolidated co-investment ventures less costs directly associated with our strategic capital group and Net Promote Income (Expense). Realized development gains include our share of gains on dispositions of development properties and land, net of taxes. To calculate the per share amount, the amount generated by each line of business is divided by the weighted average diluted common shares outstanding used in our Core FFO per share calculation. Management believes evaluating our results by line of business is a useful supplemental measure of our operating performance because it helps the investing public compare the operating performance of Prologis' respective businesses to other companies' comparable businesses. Prologis' computation of FFO by line of business may not be comparable to that reported by other real estate companies as they may use different methodologies in computing such measures.
Calculation of Per Share Amounts
Three Months Ended Twelve Months Ended
Dec. 31, Dec. 31,
in thousands, except per share amount 2025 2024 2025 2024
Net earnings
Net earnings attributable to common stockholders $1,398,227 $1,277,379 $3,322,349 $3,725,754
Noncontrolling interest attributable to exchangeable limited partnership units 33,600 32,201 81,773 94,052
Adjusted net earnings attributable to common
stockholders - Diluted $1,431,827 $1,309,580 $3,404,122 $3,819,806
Weighted average common shares outstanding - Basic 929,527 926,637 928,473 926,172
Incremental weighted average effect on exchange of limited partnership units 22,473 23,496 23,034 23,445
Incremental weighted average effect of equity awards 6,019 3,947 5,325 3,973
Weighted average common shares outstanding -
Diluted 958,019 954,080 956,832 953,590
Net earnings per share - Basic $1.50 $1.38 $3.58 $4.02
Net earnings per share - Diluted $1.49 $1.37 $3.56 $4.01
Three Months Ended Twelve Months Ended
Dec. 31, Dec. 31,
in thousands, except per share amount 2025 2024 2025 2024
Core FFO
Core FFO attributable to common stockholders/unitholders $1,383,657 $1,434,662 $5,561,300 $5,304,939
Noncontrolling interest attributable to exchangeable limited partnership units 207 314 1,032 1,177
Core FFO attributable to common stockholders /unitholders - Diluted $1,383,864 $1,434,976 $5,562,332 $5,306,116
Less: Net Promote Income (Expense) (12,362) 82,674 (48,960) 31,714
Core FFO attributable to common stockholders /unitholders, excluding Net Promote Income $1,396,226 $1,352,302 $5,611,292 $5,274,402
(Expense) - Diluted
Weighted average common shares outstanding - Basic 929,527 926,637 928,473 926,172
Incremental weighted average effect on exchange of limited partnership units 22,473 23,496 23,034 23,445
Incremental weighted average effect of equity awards 6,019 3,947 5,325 3,973
Weighted average common shares outstanding - Diluted 958,019 954,080 956,832 953,590
Core FFO per share - Diluted $1.44 $1.50 $5.81 $5.56
Core FFO per share, excluding Net Promote Income (Expense) - Diluted $1.46 $1.42 $5.86 $5.53
Development Portfolio includes industrial and non-industrial properties, data centers, yards and parking lots that are under development and properties that are developed but have not met Stabilization. At December 31, 2025, total TEI for yards, parking lots, data centers and non-industrial assets was $1.0 billion on an Owned and Managed and Prologis Share basis. We do not disclose square footage for yards and parking lots.
Estimated Value Creation represents the value that we expect to create through our development and leasing activities. We calculate Estimated Value Creation by estimating the Stabilized NOI that the property will generate and applying a stabilized capitalization rate applicable to that property. Estimated Value Creation is calculated as the amount by which the value exceeds our TEI, including closing costs and taxes, if any, and does not include any fees or promotes we may earn.
Estimated Weighted Average Margin is calculated on development properties as Estimated Value Creation, less estimated closing costs and taxes, if any, on properties expected to be sold or contributed, divided by TEI.
Estimated Weighted Average Stabilized Yield is calculated on the properties in the Development Portfolio as Stabilized NOI divided by TEI. The yields on a Prologis Share basis were as follows:
Pre-Stabilized 2026 Expected Completion 2027 and Thereafter Total Development
Developments Expected Portfolio
Completion
U.S. 6.6 % 6.5 % 7.8 % 6.8 %
Other Americas 6.6 % 8.6 % 0.0 % 7.2 %
Europe 5.5 % 5.4 % 0.0 % 5.4 %
Asia 4.8 % 5.9 % 4.6 % 5.1 %
Total 6.1 % 6.3 % 6.6 % 6.3 %
FFO, as modified by Prologis attributable to common stockholders/unitholders ("FFO, as modified by Prologis"); Core FFO attributable to common stockholders/unitholders ("Core FFO"); AFFO attributable to common stockholders/unitholders ("AFFO"); (collectively referred to as "FFO"). FFO is a non-GAAP financial measure that is commonly used in the real estate industry, with net earnings as the most directly comparable GAAP measure.
The National Association of Real Estate Investment Trusts ("NAREIT") defines FFO as earnings computed under GAAP to exclude depreciation and gains and losses from sales net of any related tax, along with impairment charges, of previously depreciated properties. This measure excludes the gains on revaluation of equity investments upon acquisition of a controlling interest and the gain recognized from a partial sale of our investment, as these are similar to gains from the sales of previously depreciated properties. This measure excludes similar adjustments from our unconsolidated entities and the third parties' share of our consolidated ventures.
Our FFO Measures
Our FFO measures begin with NARElT's definition, with certain adjustments to calculate FFO, as modified by Prologis, and Core FFO, both as defined below, to reflect our business and execution of our management strategy. While these adjustments are subject to significant fluctuations from period to period, with both positive and negative short-term impacts, the removal of the effects of these items enhances our understanding of the core operating performance of our properties over the long term.
We use FFO, as modified by Prologis, so that management, analysts and investors are able to evaluate our performance against other REITs that do not have similar operations or operations in jurisdictions outside the U.S. We use both Core FFO and AFFO to (i) assess our operating performance as compared to other real estate companies; (ii) evaluate our performance and the performance of our properties in comparison with expected results and results of previous periods; (iii) evaluate the performance of our management; (iv) budget and forecast future results to assist in the allocation of resources; and (v) evaluate how a specific potential investment will impact our future results.
We calculate our FFO measures based on our proportionate ownership share of both our unconsolidated entities and consolidated ventures. We reflect our share of our FFO measures for unconsolidated entities by applying our average ownership percentage for the period to the applicable adjustments on an entity-by-entity basis. We reflect our share for consolidated ventures in which we do not own 100% of the equity by removing the noncontrolling interests share of the applicable adjustments based on our average ownership percentage for the applicable periods.
FFO, as modified by Prologis
To arrive at FFO, as modified by Prologis, we adjust the NAREIT defined FFO measure to exclude:
(I)
deferred income tax benefits and deferred income tax expenses recognized by our subsidiaries;
(II) current income tax expense related to acquired tax liabilities that were recorded as deferred tax liabilities in an acquisition,
to the extent the expense is offset with a deferred income tax benefit in earnings that is excluded from our defined FFO
measure; and
(III) foreign currency exchange gains and losses resulting from (a) debt transactions between us and our foreign entities; (b) third-
party debt that is used to hedge our investment in foreign entities; (c) derivative financial instruments related to any such
debt transactions; and (d) mark-to-market adjustments associated with derivative and other financial instruments.
Core FFO
To arrive at Core FFO, we adjust FFO, as modified by Prologis, to exclude the following:
(I) gains or losses from the disposition of land and development properties that were developed with the intent to contribute or
sell;
(II)
income tax expense related to the sale of investments in real estate;
(III) impairment charges recognized related to our investments in real estate generally as a result of our change in intent to
contribute or sell these properties; and
(IV)
gains or losses from the early extinguishment of debt and redemption and repurchase of preferred stock.
AFFO
To arrive at AFFO, we adjust Core FFO to include realized gains from the disposition of land and development properties, net of current tax expense, turnover costs and property improvements exclude the following items that we recognize directly in Core FFO:
(I)
straight-line rents;
(II)
amortization of above- and below-market lease intangibles;
(III)
amortization of management contracts;
(IV) amortization of debt premiums and discounts and financing costs, net of
amounts capitalized; and,
(V)
stock compensation amortization expense.
Limitations on the use of our FFO measures
While we believe our modified FFO measures are important supplemental measures, neither NAREIT's nor our measures of FFO should be used alone because they exclude significant components of net earnings computed under GAAP and are, therefore, limited as an analytical tool. Some of these limitations arise from excluding income tax expense that may be payable or depreciation and amortization expenses that reflect costs necessary to maintain operating performance. In addition, our FFO measure does not reflect changes in asset values resulting from fluctuations in market conditions or foreign currency exchange rates nor costs or benefits from settlement of deferred income taxes or the extinguishment of debt. We do not use NAREIT's nor our measures of FFO as alternatives to net earnings computed under GAAP or as alternatives to cash from operating activities computed under GAAP or as indicators of our ability to fund our cash needs.
We compensate for the limitations by using our FFO measures only in conjunction with net earnings computed under GAAP when making our decisions. This information should be read with our complete Consolidated Financial Statements prepared under GAAP. To assist investors in compensating for these limitations, we reconcile our modified FFO measures from consolidated net earnings attributable to common stockholders.
Guidance. The following is a reconciliation of our annual guided Net Earnings per share to our guided Core FFO per share:
Low High
Net earnings attributable to common stockholders (a) $
3.70 $
4.00
Our share of:
Depreciation and amortization 3.10 3.15
Net gains on real estate transactions, net of taxes (0.80) (0.95)
Unrealized foreign currency losses (gains), losses (gains) on early extinguishment of debt and other, net
Core FFO attributable to common stockholders/unitholders $
6.00 $
6.20
Less: Net Promote Income (Expense) (0.05) (0.05)
Core FFO attributable to common stockholders/unitholders, excluding Net Promote Income (Expense) $
6.05 $
6.25
(a) Earnings guidance includes potential future gains recognized from real estate transactions, but excludes future foreign currency
or derivative gains or losses as these items are difficult to predict.
Market Capitalization equals Market Equity, less liquidation preference of the preferred shares/units, plus our share of total debt.
Net Promote Income (Expense) is promote revenue earned from third-party investors during the period, net of related cash and stock compensation expenses, and taxes and foreign currency derivative gains and losses, if applicable.
Operating Portfolio represents industrial properties in our Owned and Managed portfolio that have reached Stabilization. Assets held for sale, Non-Strategic Assets and non-industrial assets are excluded from the portfolio. NOI of our Operating Portfolio excludes net termination fees and adjustments. Prologis Share of NOI includes NOI for the properties contributed to or acquired from co-investment ventures at our actual share prior to and subsequent to change in ownership. The U.S. markets not presented consist of Austin, Charlotte, Columbus, Denver, Louisville, Portland, Raleigh-Durham, Reno, San Antonio, Savannah and Tampa. The European countries not presented consist of Belgium, Czech Republic, Hungary, Italy, Poland, Slovakia, Spain and Sweden.
Owned and Managed represents the consolidated properties as well as properties owned by our unconsolidated co-investment ventures, which we manage.
Prologis Share represents our proportionate economic ownership of each entity, or property included in our total Owned and Managed portfolio, whether consolidated or unconsolidated.
Rent Change (Cash) represents the percentage change in starting rental rates per the lease agreement, on new and renewed leases, commenced during the period compared with the previous ending rental rates in that same space. This measure excludes any short-term leases of less than one-year, holdover payments, free rent periods and introductory (teaser rates) defined as 50% or less of the stabilized rate.
Rent Change (Net Effective) represents the percentage change in net effective rental rates (average rate over the lease term), on new and renewed leases, commenced during the period compared with the previous net effective rental rates for the same respective spaces. This measure excludes any short-term leases of less than one year and holdover payments.
Retention is the square footage of all leases commenced during the period that are rented by existing tenants divided by the square footage of all expiring leases during the reporting period. The square footage of tenants that default or buy-out prior to expiration of their lease and short-term leases of less than one year, are not included in the calculation.
Same Store. Our same store metrics are non-GAAP financial measures, which are commonly used in the real estate industry and expected from the financial community, on both a net effective and cash basis. We evaluate the performance of the operating properties we own and manage using a "same store" analysis because the population of properties in this analysis is consistent from period to period, which allows us and investors to analyze our ongoing business operations. We determine our same store metrics on property NOI, which is calculated as rental revenue less rental expense for the applicable properties in the same store population for both consolidated and unconsolidated properties based on our ownership interest, as further defined below.
We define our same store population for the three months ended December 31, 2025 as the properties in our Owned and Managed Operating Portfolio, including the property NOI for both consolidated properties and properties owned by the unconsolidated co-investment ventures at January 1, 2024 and owned throughout the same three-month period in both 2024 and 2025.
We believe the drivers of property NOI for the consolidated portfolio are generally the same for the properties owned by the ventures in which we invest and therefore we evaluate the same store metrics of the Owned and Managed portfolio based on Prologis' ownership in the properties ("Prologis Share").
The same store population excludes properties held for sale to third parties, along with development properties that were not stabilized at the beginning of the period (January 1, 2024) and properties acquired or disposed of to third parties during the periods. To derive an appropriate measure of period-to-period operating performance, we remove the effects of foreign currency exchange rate movements by using the reported period-end exchange rate to translate from local currency into the U.S. dollar, for both periods.
As non-GAAP financial measures, the same store metrics have certain limitations as an analytical tool and may vary among real estate companies. As a result, we provide a reconciliation of Rental Revenues less Rental Expenses ("Property NOI") (from our Consolidated Financial Statements prepared in accordance with U.S. GAAP) to our Same Store Property NOI measures, as follows:
Three Months Ended
Dec. 31,
dollars in thousands 2025 2024 Change (%)
Reconciliation of Consolidated Property NOI to Same Store Property NOI measures:
Rental revenues $2,092,107 $1,937,507
Rental expenses (503,222) (438,468)
Consolidated Property NOI $1,588,885 $1,499,039
Adjustments to derive same store results:
Property NOI from consolidated properties not included in same (227,993) (188,109)
store portfolio and other adjustments (a)
Property NOI from unconsolidated co-investment ventures
included 924,232 871,488
in same store portfolio (a)(b)
Third parties' share of Property NOI from properties included in (731,132) (697,778)
same store portfolio (a)(b)
Prologis Share of Same Store Property NOI - Net Effective
(b) $1,553,992 $1,484,640 4.7 %
Consolidated properties straight-line rent and fair value lease (117,529) (124,064)
amortization included in the same store portfolio (c)
Unconsolidated co-investment ventures straight-line rent and
fair (36,692) (22,969)
value lease amortization included in the same store portfolio
(c)
Third parties' share of straight-line rent and fair value lease 27,016 12,814
amortization included in the same store portfolio (b)(c)
Prologis Share of Same Store Property NOI - Cash
(b)(c) $1,426,787 $1,350,421 5.7 %
(a) We exclude properties held for sale to third parties, along with development properties that were not stabilized at the beginning
of the periods and properties acquired or disposed of to third parties during the periods. We also exclude one-time items due
to early lease terminations, including termination fees received from customers and the write-off of related lease assets and
liabilities, that are not indicative of the property's recurring operating performance in order to evaluate the growth or
decline in each property's rental revenues. Same Store Property NOI is adjusted to include an allocation of property management
expenses for our consolidated properties based on the property management services provided to each property (generally, based
on a percentage of revenues). On consolidation, these amounts are eliminated and the actual costs of providing property
management and leasing services are recognized as part of our consolidated rental expense.
(b) We include the Property NOI for the same store portfolio for both consolidated properties and properties owned by the co-
investment ventures based on our investment in the underlying properties. In order to calculate our share of Same Store Property
NOI from the co-investment ventures in which we own less than 100%, we use the co-investment ventures' underlying Property NOI
for the same store portfolio and apply our ownership percentage at December 31, 2025 to the Property NOI for both periods,
including the properties contributed during the periods. We adjust the total Property NOI from the same store portfolio of the
co-investment ventures by subtracting the third parties' share of both consolidated and unconsolidated co-investment ventures.
During the periods presented, certain wholly-owned properties were contributed to a co-investment venture and are included in
the same store portfolio. Neither our consolidated results nor those of the co-investment ventures, when viewed individually,
would be comparable on a same store basis because of the changes in composition of the respective portfolios from period to
period (e.g. the results of a contributed property are included in our consolidated results through the contribution date and in
the results of the venture subsequent to the contribution date based on our ownership interest at the end of the period). As a
result, only line items labeled "Prologis Share of Same Store Property NOI" are comparable period over period.
(c) We further remove certain noncash items (straight-line rent and fair value lease amortization) included in the financial
statements prepared in accordance with U.S. GAAP to reflect a Same Store Property NOI - Cash measure.
We manage our business and compensate our executives based on the same store results of our Owned and Managed portfolio at 100%
as we manage our portfolio on an ownership blind basis. We calculate those results by including 100% of the properties included
in our same store portfolio.
Stabilization is defined as the earlier of when a property that was developed has been completed for one year, is contributed to a co-investment venture following completion or is 90% occupied. Upon Stabilization, a property is moved into our Operating Portfolio.
Total Expected Investment ("TEI") represents total estimated cost of development or expansion, including land, development and leasing costs. TEI is based on current projections and is subject to change.
Weighted Average Interest Rate is based on the effective rate, which includes the amortization of related premiums and discounts and finance costs.
Weighted Average Stabilized Capitalization ("Cap") Rate is calculated as Stabilized NOI divided by the Acquisition Price.
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SOURCE Prologis, Inc.
Investors: Prologis Investor Relations, prologis-IR@prologis.com; Media: Prologis Corporate Communications, jnelson2@prologis.com