Prologis, a leading logistics warehouse operator, had a phenomenal year in 2025, signing a record number of new leases. This surge in lease signings comes as more customers are opting for long-term real estate commitments following a prolonged downturn and concerns over trade wars. The company reported consolidated revenue of $2.09 billion in the fourth quarter, marking an 8% increase year over year and meeting analysts’ expectations. Core funds from operations (FFO) also matched the consensus estimate at $1.44 per share.
CEO Dan Letter expressed his excitement about the record-breaking year, stating that the strong momentum from 2025 sets the business up for success in 2026. Customers are increasingly making long-term decisions with confidence, and Prologis is well-equipped to meet this demand with a platform that integrates logistics, digital infrastructure, and energy on a global scale.
Despite challenges such as fluctuating tariffs and a post-Covid market hangover, Prologis inked deals for 228 million square feet of space last year, representing a nearly 20% year-over-year increase. In the fourth quarter, new lease commencements were down 6% to 43.8 million square feet, with average occupancy dropping slightly to 95.3%. However, the quarter ended with the highest occupancy rate of the year at 95.8%, indicating a potential market bottom.
Looking ahead to 2026, Prologis has provided guidance for core FFO between $6.00 and $6.20 per share, aligning with the consensus estimate of $6.13. The company anticipates average occupancy to range between 94.75% and 95.75%, with development starts totaling between $2.25 billion and $2.75 billion.
Following the positive financial results, shares of PLD were up 1.6% in premarket trading. Prologis will be hosting a call at noon EST on Wednesday to delve deeper into the fourth-quarter results.
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