Prologis reported record Q2 lease signings of 67 million square feet and raised its full-year core FFO forecast to $6.22–$6.30 per share. Revenue hit $2.43 billion (+11% YoY), while net effective rent change reached 36.9%, driving $16 million in incremental NOI. U.S. net absorption totaled 66 million sq ft—the highest since 2022—and development starts are now guided to $4.5–$5.5 billion, reflecting surging logistics demand. The REIT’s portfolio maintained 95.5% occupancy, outperforming the U.S. market’s 7.2% vacancy rate.
According to www.freightwaves.com, Prologis reported record second-quarter lease signings of 67 million square feet, raised its full-year core funds from operations (FFO) guidance to $6.22 to $6.30 per share, and cited accelerating demand for logistics warehouses amid tightening U.S. industrial real estate markets.
Strong Q2 performance drives upward revision
Prologis (NYSE: PLD) posted consolidated revenue of $2.43 billion for the second quarter of 2026 — an 11% year-over-year increase and $270 million above the $2.16 billion consensus estimate. Core FFO came in at $1.63 per share, up 17 cents year over year and 8 cents ahead of analyst forecasts. Shares of PLD rose 3.2% at 2:08 p.m. EDT on Thursday, while the S&P 500 declined 0.5%.
Leasing momentum hits new highs
Lease signings totaled 67 million square feet — a record high for the fourth time in the past seven quarters. Leases commenced during the quarter amounted to 61.7 million square feet, representing a 21% year-over-year increase. Average portfolio occupancy stood at 95%, up 10 basis points year over year but down 30 basis points sequentially; occupancy ended the quarter at 95.5%.
Rent growth accelerates across key markets
Net effective rent change on multiyear leases was 36.9% — near the company’s full-year target of 40% — generating $16 million in incremental net operating income. Lease mark-to-market — the difference between in-place rents and current market rates — was estimated at 17%, translating to $800 million in future net operating income. U.S. net absorption reached 66 million square feet in the quarter, the highest level since 2022.
Development pipeline expands with logistics focus
Prologis now forecasts total net absorption of 220 million square feet for 2026, including 195 million square feet of new completions — sufficient to lift market-wide occupancy by 30 basis points. U.S. rents rose 70 basis points during the quarter, with management expecting rent growth to outpace inflation in tight markets including Texas, the Southeast, the Midwest, and the San Francisco Bay Area. Development starts are now projected between $4.5 billion and $5.5 billion — a $1 billion increase at both ends of the range — driven primarily by logistics demand. Second-quarter development starts totaled $1.6 billion, half of which was tied to logistics properties.
Strategic context and competitive positioning
Prologis’ portfolio outperformed the broader U.S. industrial market, which carried a 7.2% vacancy rate in the quarter. While the company did not comment on its rejected £12.6 billion ($16.6 billion) takeover bid for London-based Segro — turned down last month — its operational execution underscores continued leadership in logistics real estate. According to FreightWaves finance editor Todd Maiden, the results reflect “sustained market share gains and structural advantages in high-barrier logistics markets.”
Source: FreightWaves
Compiled from international media by the SCI.AI editorial team.
