UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
☒QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 2025
☐TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from ______________ to ______________
Commission File Number: 001-13545 (Prologis, Inc.) 001-14245 (Prologis, L.P.)
Prologis, Inc.
Prologis, L.P.
(Exact name of registrant as specified in its charter)
Maryland (Prologis, Inc.)
Delaware (Prologis, L.P.)
94-3281941 (Prologis, Inc.)
94-3285362 (Prologis, L.P.)
(State or other jurisdiction of
incorporation or organization)
(I.R.S. Employer
Identification No.)
Pier 1, Bay 1, San Francisco, California
94111
(Address of principal executive offices)
(Zip Code)
(415) 394-9000
(Registrants’ telephone number, including area code)
(Former name, former address and former fiscal year, if changed since last report)
Securities registered pursuant to Section 12(b) of the Act:
Title of Each Class
Trading Symbol(s)
Name of Each Exchange on Which Registered
Common Stock, $0.01 par value
PLD
New York Stock Exchange
3.000% Notes due 2026
PLD/26
2.250% Notes due 2029
PLD/29
5.625% Notes due 2040
PLD/40
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
Yes
☒
No
☐
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter periods that the registrant was required to submit such files).
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act:
Prologis, Inc.:
Large accelerated filer ☒
Accelerated filer ☐
Non-accelerated filer ☐
Smaller reporting company ☐
Emerging growth company ☐
Prologis, L.P.:
Large accelerated filer ☐
Non-accelerated filer ☒
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Securities Exchange Act of 1934).
The number of shares of Prologis, Inc.’s common stock outstanding at July 25, 2025, was approximately 928,063,000.
EXPLANATORY NOTE
This report combines the quarterly reports on Form 10-Q for the period ended June 30, 2025, of Prologis, Inc. and Prologis, L.P. Unless stated otherwise or the context otherwise requires, references to “Prologis, Inc.” or the “Parent” mean Prologis, Inc. and its consolidated subsidiaries; and references to “Prologis, L.P.” or the “Operating Partnership” or the “OP” mean Prologis, L.P., and its consolidated subsidiaries. The terms “the Company,” “Prologis,” “we,” “our” or “us” means the Parent and the OP collectively.
The Parent is a real estate investment trust (a “REIT”) and the general partner of the OP. At June 30, 2025, the Parent owned a 97.65% common general partnership interest in the OP and substantially all of the preferred units in the OP. The remaining 2.35% common limited partnership interests are owned by unaffiliated investors and certain current and former directors and officers of the Parent.
We operate the Parent and the OP as one enterprise. The management of the Parent consists of the same members as the management of the OP. These members are officers of the Parent and employees of the OP or one of its subsidiaries. As sole general partner, the Parent has control of the OP through complete responsibility and discretion in the day-to-day management and therefore, consolidates the OP for financial reporting purposes. Because the only significant asset of the Parent is its investment in the OP, the assets and liabilities of the Parent and the OP are the same on their respective financial statements.
We believe combining the quarterly reports on Form 10-Q of the Parent and the OP into this single report results in the following benefits:
It is important to understand the few differences between the Parent and the OP in the context of how we operate the Company. The Parent does not conduct business itself, other than acting as the sole general partner of the OP and issuing public equity from time to time. The OP holds substantially all the assets of the business, directly or indirectly. The OP conducts the operations of the business and is structured as a partnership with no publicly traded equity. Except for net proceeds from equity issuances by the Parent, which are contributed to the OP in exchange for partnership units, the OP generates capital required by the business through the OP’s operations, incurrence of indebtedness and issuance of partnership units to third parties.
The presentation of noncontrolling interests, stockholders’ equity and partners’ capital are the main areas of difference between the consolidated financial statements of the Parent and those of the OP. The differences in the presentations between stockholders’ equity and partners’ capital result from the differences in the equity and capital issuances in the Parent and in the OP.
The preferred stock, common stock, additional paid-in capital, accumulated other comprehensive income (loss) and distributions in excess of net earnings of the Parent are presented as stockholders’ equity in the Parent’s consolidated financial statements. These items represent the common and preferred general partnership interests held by the Parent in the OP and are presented as general partner’s capital within partners’ capital in the OP’s consolidated financial statements. The common limited partnership interests held by the limited partners in the OP are presented as noncontrolling interest within equity in the Parent’s consolidated financial statements and as limited partners’ capital within partners’ capital in the OP’s consolidated financial statements.
To highlight the differences between the Parent and the OP, separate sections in this report, as applicable, individually discuss the Parent and the OP, including separate financial statements and separate Exhibit 31 and 32 certifications. In the sections that combine disclosure of the Parent and the OP, this report refers to actions or holdings as being actions or holdings of Prologis.
PROLOGIS
INDEX
Page
Number
PART I.
Financial Information
Item 1.
Financial Statements
1
Consolidated Balance Sheets – June 30, 2025 and December 31, 2024
Consolidated Statements of Income – Three and Six Months Ended June 30, 2025 and 2024
2
Consolidated Statements of Comprehensive Income – Three and Six Months Ended June 30, 2025 and 2024
3
Consolidated Statements of Equity – Three and Six Months Ended June 30, 2025 and 2024
4
Consolidated Statements of Cash Flows – Six Months Ended June 30, 2025 and 2024
5
6
7
8
Consolidated Statements of Capital – Three and Six Months Ended June 30, 2025 and 2024
9
10
Prologis, Inc. and Prologis, L.P.:
Notes to the Consolidated Financial Statements
11
Note 1. General
Note 2. Real Estate
12
Note 3. Unconsolidated Entities
13
Note 4. Assets Held for Sale or Contribution
15
Note 5. Debt
Note 6. Noncontrolling Interests
18
Note 7. Long-Term Compensation
19
Note 8. Earnings Per Common Share or Unit
20
Note 9. Financial Instruments and Fair Value Measurements
21
Note 10. Reportable Segments
25
Note 11. Supplemental Cash Flow Information
28
Reports of Independent Registered Public Accounting Firm
29
Item 2.
Management’s Discussion and Analysis of Financial Condition and Results of Operations
31
Item 3.
Quantitative and Qualitative Disclosures About Market Risk
50
Item 4.
Controls and Procedures
51
PART II.
Other Information
Legal Proceedings
52
Item 1A.
Risk Factors
Unregistered Sales of Equity Securities and Use of Proceeds
Defaults Upon Senior Securities
Mine Safety Disclosures
Item 5.
Item 6.
Exhibits
Index
PART I. FINANCIAL INFORMATION
ITEM 1. Financial Statements
PROLOGIS, INC.
CONSOLIDATED BALANCE SHEETS
(Unaudited)
(In thousands, except per share data)
June 30, 2025
December 31, 2024
ASSETS
Investments in real estate properties
$
94,332,511
91,246,176
Less accumulated depreciation
13,827,462
12,758,159
Net investments in real estate properties
80,505,049
78,488,017
Investments in and advances to unconsolidated entities
10,618,184
10,079,448
Assets held for sale or contribution
253,331
248,511
Net investments in real estate
91,376,564
88,815,976
Cash and cash equivalents
1,066,081
1,318,591
Other assets
5,274,405
5,194,342
Total assets
97,717,050
95,328,909
LIABILITIES AND EQUITY
Liabilities:
Debt
34,666,551
30,879,263
Accounts payable and accrued expenses
1,627,999
1,769,327
Other liabilities
4,115,686
4,063,549
Total liabilities
40,410,236
36,712,139
Equity:
Prologis, Inc. stockholders’ equity:
Series Q preferred stock at stated liquidation preference of $50 per share; $0.01 par value; 1,279 shares issued and outstanding and 100,000 preferred shares authorized at June 30, 2025 and December 31, 2024
63,948
Common stock; $0.01 par value; 928,037 and 926,283 shares issued and outstanding at June 30, 2025 and December 31, 2024, respectively
9,280
9,263
Additional paid-in capital
54,604,092
54,464,055
Accumulated other comprehensive loss
(765,507
)
(120,215
Distributions in excess of net earnings
(1,183,239
(465,913
Total Prologis, Inc. stockholders’ equity
52,728,574
53,951,138
Noncontrolling interests
4,578,240
4,665,632
Total equity
57,306,814
58,616,770
Total liabilities and equity
The accompanying notes are an integral part of these Consolidated Financial Statements.
CONSOLIDATED STATEMENTS OF INCOME
(In thousands, except per share amounts)
Three Months Ended
Six Months Ended
June 30,
2025
2024
Revenues:
Rental
2,025,332
1,852,376
4,012,597
3,680,034
Strategic capital
147,162
154,742
288,301
283,154
Development management and other
11,375
836
22,636
1,387
Total revenues
2,183,869
2,007,954
4,323,534
3,964,575
Expenses:
487,963
445,235
976,280
899,492
64,917
70,536
125,694
149,347
General and administrative
106,871
106,596
221,572
217,887
Depreciation and amortization
657,221
637,305
1,309,279
1,274,810
Other
11,706
11,444
21,355
23,688
Total expenses
1,328,678
1,271,116
2,654,180
2,565,224
Operating income before gains on real estate transactions, net
855,191
736,838
1,669,354
1,399,351
Gains on dispositions of development properties and land, net
10,477
87,174
37,928
127,482
Gains on other dispositions of investments in real estate, net
47,044
199,326
83,843
216,860
Operating income
912,712
1,023,338
1,791,125
1,743,693
Other income (expense):
Earnings from unconsolidated entities, net
107,692
102,337
175,591
174,809
Interest expense
(251,866
(208,267
(483,617
(401,587
Foreign currency, derivative and other gains (losses) and other income (expense), net
(122,829
37,152
(154,487
100,716
Gains (losses) on early extinguishment of debt, net
-
536
Total other income (expense)
(267,003
(68,778
(462,513
(125,526
Earnings before income taxes
645,709
954,560
1,328,612
1,618,167
Income tax expense
(23,405
(43,059
(66,788
(75,859
Consolidated net earnings
622,304
911,501
1,261,824
1,542,308
Less net earnings attributable to noncontrolling interests
51,075
50,153
97,642
95,245
Net earnings attributable to controlling interests
571,229
861,348
1,164,182
1,447,063
Less preferred stock dividends
1,505
1,503
2,957
2,955
Net earnings attributable to common stockholders
569,724
859,845
1,161,225
1,444,108
Weighted average common shares outstanding – Basic
928,476
926,276
927,909
925,812
Weighted average common shares outstanding – Diluted
955,882
953,200
955,601
953,439
Net earnings per share attributable to common stockholders – Basic
0.61
0.93
1.25
1.56
Net earnings per share attributable to common stockholders – Diluted
0.92
1.55
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(In thousands)
Other comprehensive income:
Foreign currency translation gains (losses), net
(428,953
120,471
(659,643
329,443
Unrealized gains (losses) on derivative contracts, net
4,417
10,687
1,469
35,523
Comprehensive income
197,768
1,042,659
603,650
1,907,274
Net earnings attributable to noncontrolling interests
(51,075
(50,153
(97,642
(95,245
Other comprehensive loss (income) attributable to noncontrolling interests
8,617
(1,816
12,882
(6,818
Comprehensive income attributable to common stockholders
155,310
990,690
518,890
1,805,211
CONSOLIDATED STATEMENTS OF EQUITY
Three Months Ended June 30, 2025 and 2024
Common Stock
Accumulated
Distributions
Additional
in Excess of
Non-
Preferred
of
Par
Paid-in
Comprehensive
Net
controlling
Total
Stock
Shares
Value
Capital
Income (Loss)
Earnings
Interests
Equity
Balance at April 1, 2025
927,882
9,279
54,556,451
(349,588
(812,880
4,608,228
58,075,438
Effect of equity compensation plans
64
26,894
22,527
49,421
Capital contributions
13,239
Purchase of noncontrolling interests
(1,256
(11,984
(13,240
Redemption of noncontrolling interests
91
5,918
(6,623
(704
(420,232
(8,721
4,313
104
Reallocation of equity
16,092
(16,092
Dividends ($1.01 per common share) and other distributions
(7
(941,588
(73,513
(1,015,108
Balance at June 30, 2025
928,037
Balance at April 1, 2024
925,790
9,258
54,336,001
(285,395
(933,159
4,606,465
57,797,118
(25
18,248
45,045
63,293
4,761
115
6,619
(6,873
(253
118,911
1,560
10,431
256
31,656
(31,656
Dividends ($0.96 per common share) and other distributions
(892,809
(91,450
(984,257
Balance at June 30, 2024
925,880
9,259
54,392,526
(156,053
(964,620
4,578,261
57,923,321
Six Months Ended June 30, 2025 and 2024
Balance at January 1, 2025
926,283
338
50,579
56,403
106,985
26,473
1,416
14
82,187
(86,908
(4,707
(646,727
(12,916
1,435
34
7,578
(7,578
Dividends ($2.02 per common share) and other distributions
949
(1,881,508
(148,558
(2,029,117
Balance at January 1, 2024
924,391
9,244
54,249,801
(514,201
(627,068
4,641,996
57,823,720
293
33,349
99,878
133,230
6,031
1,196
68,639
(69,150
(499
323,472
5,971
34,676
847
40,744
(40,744
Dividends ($1.92 per common share) and other distributions
(1,784,615
(161,813
(1,946,435
CONSOLIDATED STATEMENTS OF CASH FLOWS
Operating activities:
Adjustments to reconcile net earnings to net cash provided by (used in) operating activities:
Straight-lined rents and amortization of above and below market leases
(368,162
(303,309
Equity-based compensation awards
97,145
121,782
(175,591
(174,809
Operating distributions from unconsolidated entities
292,316
255,800
Decrease (increase) in operating receivables from unconsolidated entities
4,786
22,234
Amortization of debt discounts and debt issuance costs, net
42,757
38,112
(37,928
(127,482
(83,843
(216,860
Unrealized foreign currency and derivative losses (gains), net
193,333
(37,945
Losses (gains) on early extinguishment of debt, net
(536
Deferred income tax expense (benefit)
2,364
10,505
Decrease (increase) in other assets
(40,264
(53,252
Increase (decrease) in accounts payable and accrued expenses and other liabilities
(95,546
(209,445
Net cash provided by (used in) operating activities
2,402,470
2,141,913
Investing activities:
Real estate development
(1,331,268
(1,555,152
Real estate acquisitions
(1,153,666
(525,560
Tenant improvements and lease commissions on previously leased space
(275,365
(215,706
Property improvements
(103,139
(126,312
Proceeds from dispositions and contributions of real estate
256,395
1,050,498
(32,600
(364,505
Return of investment from unconsolidated entities
59,030
17,394
Proceeds from the settlement of net investment hedges
4,852
12,797
Payments on the settlement of net investment hedges
(9,720
(1,350
Net cash provided by (used in) investing activities
(2,585,481
(1,707,896
Financing activities:
Dividends paid on common and preferred stock
Noncontrolling interests contributions
Noncontrolling interests distributions
Settlement of noncontrolling interests
(17,947
Tax paid with shares withheld
(15,415
(21,925
Debt and equity issuance costs paid
(25,340
(19,741
Net proceeds from (payments on) credit facilities and commercial paper
262,600
(472,181
Repurchase of and payments on debt
(72,397
(915,631
Proceeds from the issuance of debt
1,778,480
3,016,962
Net cash provided by (used in) financing activities
(93,612
(353,412
Effect of foreign currency exchange rate changes on cash
24,113
(12,646
Net increase (decrease) in cash and cash equivalents
(252,510
67,959
Cash and cash equivalents, beginning of period
530,388
Cash and cash equivalents, end of period
598,347
See Note 11 for information on noncash investing and financing activities and other information.
PROLOGIS, L.P.
LIABILITIES AND CAPITAL
Capital:
Partners’ capital:
General partner – preferred
General partner – common
52,664,626
53,887,190
Limited partners – common
937,698
913,227
Limited partners – Class A common
328,656
429,358
Total partners’ capital
53,994,928
55,293,723
3,311,886
3,323,047
Total capital
Total liabilities and capital
(In thousands, except per unit amounts)
37,139
28,802
68,715
59,110
585,165
882,699
1,193,109
1,483,198
Less preferred unit distributions
Net earnings attributable to common unitholders
583,660
881,196
1,190,152
1,480,243
Weighted average common units outstanding – Basic
945,440
941,858
944,556
941,242
Weighted average common units outstanding – Diluted
Net earnings per unit attributable to common unitholders – Basic
Net earnings per unit attributable to common unitholders – Diluted
(37,139
(28,802
(68,715
(59,110
(1,368
1,351
(2,635
1,929
Comprehensive income attributable to common unitholders
159,261
1,015,208
532,300
1,850,093
CONSOLIDATED STATEMENTS OF CAPITAL
General Partner
Limited Partners
Common
Class A Common
Units
Amount
1,279
53,403,262
16,609
955,890
5,941
331,865
3,320,473
10,420
3,516
757
(757
Redemption of limited partnership units
5,162
(97
(5,866
(7,461
(2,628
1,368
77
27
Reallocation of capital
(15,810
(282
Distributions ($1.01 per common unit) and other
(941,595
(22,079
(3,842
(47,592
16,524
53,126,705
15,044
863,303
7,895
432,386
3,310,776
14,417
6,934
130
6,620
117
6,614
(245
(13,487
2,018
893
(1,351
179
(31,176
(480
Distributions ($0.96 per common unit) and other
(892,807
(20,476
(4,947
(66,027
53,281,112
15,291
879,924
7,650
421,376
3,276,961
15,699
20,833
8,094
50,582
582
81,444
243
9,337
(1,709
(95,488
(11,515
(4,036
2,635
(7,085
(493
Distributions ($2.02 per common unit) and other
(1,880,559
(43,527
(8,788
(96,243
53,117,776
14,760
848,160
8,595
469,561
3,324,275
24,069
12,066
33,352
838
68,651
(307
(17,312
(945
(51,838
5,342
2,558
(1,929
573
274
(40,004
(740
Distributions ($1.92 per common unit) and other
(1,784,622
(40,782
(10,505
(110,526
Distributions paid on common and preferred units
(1,933,823
(1,835,902
Redemption of common limited partnership units
Tax paid with shares of the Parent withheld
PROLOGIS, INC. AND PROLOGIS, L.P.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
NOTE 1. GENERAL
Business. Prologis, Inc. (or the “Parent”) commenced operations as a fully integrated real estate company in 1997, elected to be taxed as a real estate investment trust (“REIT”) under the Internal Revenue Code of 1986, as amended (the “Internal Revenue Code” or “IRC”), and believes the current organization and method of operation will enable it to maintain its status as a REIT. The Parent is the general partner of Prologis, L.P. (or the “Operating Partnership” or “OP”). Through the OP, we are engaged in the ownership, acquisition, development and management of logistics facilities with a focus on key markets in 20 countries on four continents. We invest in real estate through wholly owned subsidiaries and other entities through which we co-invest with partners and investors. We maintain a significant level of ownership in these co-investment ventures, which may be consolidated or unconsolidated based on our level of control of the entity. Our current business strategy consists of two reportable segments: Real Estate (Rental Operations and Development) and Strategic Capital. Our Real Estate Segment represents the ownership, leasing and development of logistics properties. Our Strategic Capital Segment represents the management of properties owned by our unconsolidated co-investment ventures and other ventures. See Note 10 for further discussion of our reportable segments. Unless otherwise indicated, the Notes to the Consolidated Financial Statements apply to both the Parent and the OP. The terms “the Company,” “Prologis,” “we,” “our” or “us” means the Parent and OP collectively.
For each share of preferred or common stock the Parent issues, the OP issues a corresponding preferred or common partnership unit, as applicable, to the Parent in exchange for the contribution of the proceeds from the stock issuance. At June 30, 2025, the Parent owned a 97.65% common general partnership interest in the OP and substantially all of the preferred units in the OP. The remaining 2.35% common limited partnership interests, which include Class A common limited partnership units (“Class A Units”) in the OP, are owned by unaffiliated investors and certain current and former directors and officers of the Parent. Each partner’s percentage interest in the OP is determined based on the number of OP units held, including the number of OP units into which Class A Units are convertible, compared to total OP units outstanding at each period end and is used as the basis for the allocation of net income or loss to each partner. At the end of each reporting period, a capital adjustment is made in the OP to reflect the appropriate ownership interest for each of the common unitholders. These adjustments are reflected in the line items Reallocation of Equity in the Consolidated Statements of Equity of the Parent and Reallocation of Capital in the Consolidated Statements of Capital of the OP.
As the sole general partner of the OP, the Parent has complete responsibility and discretion in the day-to-day management and control of the OP, and we operate the Parent and the OP as one enterprise. The management of the Parent consists of the same members as the management of the OP. These members are officers of the Parent and employees of the OP or one of its subsidiaries. As general partner with control of the OP, the Parent is the primary beneficiary and therefore consolidates the OP. Because the Parent’s only significant asset is its investment in the OP, the assets and liabilities of the Parent and the OP are the same on their respective financial statements.
Basis of Presentation. The accompanying Consolidated Financial Statements are prepared in accordance with United States (“U.S.”) generally accepted accounting principles (“GAAP”) and are presented in our reporting currency, the U.S. dollar. Intercompany transactions with consolidated entities have been eliminated.
The accompanying unaudited interim financial information has been prepared according to the rules and regulations of the U.S. Securities and Exchange Commission (“SEC”). Certain information and note disclosures normally included in our annual financial statements prepared in accordance with GAAP have been condensed or omitted in accordance with such rules and regulations. Our management believes that the disclosures presented in these financial statements are adequate to make the information presented not misleading. In our opinion, all adjustments and eliminations, consisting only of normal recurring adjustments, necessary to present fairly the financial position and results of operations for both the Parent and the OP for the reported periods have been included. The results of operations for such interim periods are not necessarily indicative of the results for the full year. The accompanying unaudited interim financial information should be read in conjunction with our Annual Report on Form 10-K for the year ended December 31, 2024, as filed with the SEC, and other public information.
Accounting Pronouncements.
New Accounting Standards Issued but not yet Adopted
Income Taxes. In December 2023, the Financial Accounting Standards Board (“FASB”) issued an Accounting Standard Update ("ASU") to enhance the transparency and decision usefulness of income tax disclosures on an annual basis. The ASU requires additional disclosures around income tax categories and further disaggregation of federal, state and foreign tax information and eliminates certain existing requirements. The standard is effective for the fiscal year ended December 31, 2025, on a prospective or retrospective basis. We do not expect the standard to have a material impact on our Consolidated Financial Statements.
Disaggregation of Income Statement Expenses. In November 2024, the FASB issued an ASU to enhance disclosures about certain expense types in commonly presented expense captions on the Consolidated Statements of Income. The ASU requires additional
disclosures that disaggregate expense captions into specific components with qualitative descriptions. This standard is effective for the fiscal year ended December 31, 2027, and interim periods thereafter, on a prospective or retrospective basis. We do not expect the standard to have a material impact on our Consolidated Financial Statements as we anticipate the primary change will be additional disclosure in our Consolidated Financial Statements.
NOTE 2. REAL ESTATE
Investments in real estate properties consisted of the following (dollars and square feet in thousands):
Square Feet
Number of Buildings
Jun 30,
Dec 31,
Operating properties:
Buildings and improvements
650,912
643,929
3,008
2,987
56,029,929
54,840,666
Improved land
24,085,901
23,438,687
Development portfolio, including land costs:
Prestabilized
8,923
5,387
35
1,376,193
813,029
Properties under development
15,698
18,306
49
66
1,514,832
2,016,584
Land (1)
4,826,727
4,453,522
Other real estate investments (2)
6,498,929
5,683,688
Total investments in real estate properties
Acquisitions
The following table summarizes our real estate acquisition activity (dollars and square feet in thousands):
Three Months EndedJune 30,
Six Months EndedJune 30,
Number of operating properties
Square feet
1,025
2,277
3,283
Acres of land
326
122
448
365
Acquisition cost of net investments in real estate, excluding other real estate investments
195,298
283,507
934,774
567,531
Acquisition cost of other real estate investments
220,479
50,076
280,373
50,243
Dispositions
The following table summarizes our dispositions of net investments in real estate which include contributions to unconsolidated co-investment ventures and dispositions to third parties (dollars and square feet in thousands):
Dispositions of development properties and land, net (1)
Number of properties
1,210
402
1,839
Net proceeds
33,067
241,701
101,277
378,490
Other dispositions of investments in real estate, net
487
7,627
1,024
7,823
63,704
735,222
169,159
883,058
Leases
We recognized lease right-of-use assets of $676.9 million and $707.8 million within Other Assets and lease liabilities of $630.0 million and $615.3 million within Other Liabilities, principally for land and office space leases in which we are the lessee, in the Consolidated Balance Sheets at June 30, 2025 and December 31, 2024, respectively.
NOTE 3. UNCONSOLIDATED ENTITIES
Summary of Investments
We have investments in entities through a variety of ventures. We co-invest in entities that own multiple properties with partners and investors and we provide asset management and property management services to these entities, which we refer to as co-investment ventures. These entities may be consolidated or unconsolidated depending on the structure, our partner’s participation and other rights and our level of control of the entity. This note details our investments in unconsolidated co-investment ventures, which are related parties and accounted for using the equity method of accounting. See Note 6 for more detail regarding our consolidated investments that are not wholly owned.
We also have investments in other ventures, generally with one partner, which we primarily account for using the equity method. We refer to our investments in both unconsolidated co-investment ventures and other ventures, collectively, as unconsolidated entities.
The following table summarizes our investments in and advances to unconsolidated entities (in thousands):
December 31,
Unconsolidated co-investment ventures
9,821,442
9,274,762
Other ventures
796,742
804,686
Unconsolidated Co-Investment Ventures
The following table summarizes the Strategic Capital Revenues we recognized in the Consolidated Statements of Income related to our unconsolidated co-investment ventures (in thousands):
Recurring fees
130,805
114,779
253,489
227,921
Transactional fees
14,121
13,170
30,519
25,414
Promote revenue (1)
23,857
24,119
Total strategic capital revenues from unconsolidated co-investment ventures (2)
144,926
151,806
284,008
277,454
The following table summarizes the key property information, financial position and operating information of our unconsolidated co-investment ventures on a U.S. GAAP basis (not our proportionate share) and the amounts we recognized in the Consolidated Financial Statements related to these ventures (dollars and square feet in millions):
U.S.
Other Americas (1)
Europe
Asia
At:
Jun 30,2025
Dec 31,2024
Key property information:
Ventures
Operating properties
769
767
390
391
1,046
1,037
241
2,448
2,436
134
85
235
232
101
100
555
551
Financial position:
Total assets ($)
13,934
13,903
7,263
7,112
26,474
23,873
9,813
9,404
57,484
54,292
Third-party debt ($)
5,397
5,399
2,218
2,242
6,890
6,343
4,142
3,942
18,647
17,926
Total liabilities ($)
6,437
6,466
2,548
2,422
9,129
8,375
4,567
4,362
22,681
21,625
Our investment balance ($) (2)
2,991
3,023
1,190
1,168
4,862
4,371
778
713
9,821
9,275
Our weighted average ownership (3)
30.3
%
30.5
31.1
30.9
32.7
33.0
15.4
15.2
29.0
Other Americas (1)(4)
Operating Information:
Jun 30,2024
For the three months ended:
Total revenues ($)
406
362
200
120
507
430
166
153
1,065
Net earnings ($)
131
86
56
33
327
287
Our earnings from unconsolidated co-investment ventures, net ($)
40
26
36
For the six months ended:
813
715
414
240
977
892
313
2,530
2,160
202
219
109
169
163
54
37
556
528
59
55
164
Equity Commitments Related to Certain Unconsolidated Co-Investment Ventures
At June 30, 2025, our outstanding equity commitments were $192.5 million, principally for Prologis Japan Core Logistics Fund and Prologis China Logistics Venture. The equity commitments expire from 2025 to 2033 if they have not been previously called.
NOTE 4. ASSETS HELD FOR SALE OR CONTRIBUTION
We had investments in certain real estate properties that met the criteria to be classified as held for sale or contribution at June 30, 2025 and December 31, 2024. At the time of classification, these properties were expected to be sold to third parties or were recently stabilized and expected to be contributed to unconsolidated co-investment ventures within twelve months. The amounts included in Assets Held for Sale or Contribution in the Consolidated Balance Sheets represented real estate investment balances and the related assets and liabilities.
Assets held for sale or contribution consisted of the following (dollars and square feet in thousands):
June 30,2025
December 31,2024
2,184
2,229
Total assets held for sale or contribution
Total liabilities associated with assets held for sale or contribution – included in Other Liabilities
3,819
1,951
NOTE 5. DEBT
All debt is incurred by the OP or its consolidated subsidiaries. The following table summarizes our debt (dollars in thousands):
Weighted Average
Interest Rate (1)
Years (2)
Outstanding (3)
Credit facilities and commercial paper
2.9%
2.2
520,194
4.1%
1.8
224,966
Senior notes
3.2%
9.2
31,706,006
9.8
28,322,163
Term loans and unsecured other
2.0%
4.1
2,114,625
4.4
2,013,317
Secured mortgage
4.3%
2.6
325,726
3.2
318,817
8.7
3.1%
9.4
Weighted Average Interest Rate
Amount Outstanding
% of Total
British pound sterling
3.0%
1,875,616
5.4
1,714,653
5.6
Canadian dollar
4.5%
1,735,774
5.0
4.7%
1,262,508
Euro
2.1%
11,493,729
33.2
9,900,602
32.1
Japanese yen
1.2%
3,188,887
1.1%
2,910,755
U.S. dollar
15,719,356
45.3
14,457,872
46.8
3.7%
653,189
1.9
3.6%
632,873
2.0
100.0
Credit Facilities and Commercial Paper
The following table summarizes information about our available liquidity at June 30, 2025 (in millions):
Aggregate lender commitments
Credit facilities
6,530
Less:
Credit facility borrowings outstanding
520
Commercial paper borrowings outstanding (1)
Outstanding letters of credit
Current availability
5,983
1,066
Total liquidity
7,049
Credit Facilities
In May 2025, we amended and restated one of our global senior credit facilities (the "2022 Global Facility") as the 2025 Global Facility. Each of the global senior credit facilities, the 2023 Global Facility and the 2025 Global Facility, have a borrowing capacity of $3.0 billion (subject to currency fluctuations). We may draw on both facilities in British pounds sterling, Canadian dollars, euro, Japanese yen, Mexican pesos and U.S. dollars on a revolving basis. The 2023 Global Facility is scheduled to initially mature in June 2027 and the 2025 Global Facility in June 2029; however, we can extend the maturity date for each facility by six months on two occasions, subject to the payment of extension fees. We also have the ability to increase each credit facility to $4.0 billion, subject to currency fluctuations and obtaining additional lender commitments.
We also have a Japanese yen revolver (the "Yen Credit Facility") with a borrowing capacity of ¥58.5 billion ($405.3 million at June 30, 2025). We have the ability to increase the borrowing capacity of the Yen Credit Facility to ¥75.0 billion ($519.6 million at June 30, 2025), subject to obtaining additional lender commitments. The Yen Credit Facility is scheduled to initially mature in August 2027; however, we may extend the maturity date for one year, subject to the payment of extension fees.
We refer to the 2023 Global Facility, the 2025 Global Facility and the Yen Credit Facility, collectively, as our “Credit Facilities.” Pricing for the Credit Facilities, including the spread over the applicable benchmark and the rates applicable to facility fees and letter of credit fees, varies based on the public debt ratings of the OP.
Our Credit Facilities are utilized to support our cash needs for general corporate purposes on a short-term basis. The maturities of the borrowings under the Credit Facilities generally range from overnight to three months.
Commercial Paper
We have commercial paper programs under which we may issue, repay and re-issue short-term unsecured commercial paper notes. Under our existing U.S. dollar-denominated program, the aggregate principal amount of notes outstanding at any time cannot exceed $1.0 billion. In June 2025, we established an additional multicurrency program under which we may issue notes denominated in British pound sterling, euros or U.S. dollars. The aggregate principal amount of notes outstanding under this program cannot exceed €1.0 billion (or its equivalent in other currencies) ($1.2 billion at June 30, 2025). The net proceeds from both programs are expected to be used for general corporate purposes. The maturities of the notes generally range from overnight to three months. The notes are issued under customary terms in the commercial paper market and are issued at a discount from par or, alternatively, can be issued at par and bear varying interest rates on a fixed or floating basis. At any point in time, we are required to maintain available commitments under our Credit Facilities in an amount at least equal to the amount of notes outstanding under both programs.
16
Senior Notes
The following table summarizes the issuances of senior notes during the six months ended June 30, 2025 (principal in thousands):
Aggregate Principal
Issuance Date Weighted Average
Issuance Date
Borrowing Currency
USD (1)
Interest Rate
Years
Maturity Dates
February
C$
750,000
520,428
4.2%
8.0
February 2033
May
1,250,000
5.1%
8.3
January 2031 – May 2035
1,770,428
4.8%
8.2
Long-Term Debt Maturities
Scheduled principal payments due on our debt for the remainder of 2025 and for each year through the period ended December 31, 2029, and thereafter were as follows at June 30, 2025 (in thousands):
Unsecured
Credit Facilities and
Senior
Term Loans
Secured
Maturity
Notes
and Other
Mortgage
2025 (1)(2)
34,640
246,971
178,209
459,820
2026 (1)
1,351,168
728,597
47,710
2,127,475
2027 (3)
468,040
1,988,466
52,570
4,156
2,513,232
2028
2,619,356
117,257
3,041
2,739,654
2029 (4)
52,154
3,433,648
3,191
3,488,993
Thereafter
22,849,617
971,795
82,903
23,904,315
Subtotal
32,276,895
2,117,190
319,210
35,233,489
Unamortized premiums (discounts), net
(436,741
6,768
(429,973
Unamortized debt issuance costs, net
(134,148
(2,565
(252
(136,965
Financial Debt Covenants
Our Credit Facilities, senior notes and term loans outstanding at June 30, 2025 were subject to certain financial covenants under their related documents. At June 30, 2025, we were in compliance with all of our financial debt covenants.
Guarantee of Finance Subsidiary Debt
We have finance subsidiaries as part of our operations in Europe (Prologis Euro Finance LLC), Japan (Prologis Yen Finance LLC) and the U.K. (Prologis Sterling Finance LLC) in order to mitigate our foreign currency risk by borrowing in the currencies in which we invest. These entities are 100% indirectly owned by the OP and all unsecured debt issued or to be issued by each entity is or will be fully and unconditionally guaranteed by the OP. There are no restrictions or limits on the OP’s ability to obtain funds from its subsidiaries by dividend or loan. In reliance on Rule 13-01 of Regulation S-X, the separate financial statements of Prologis Euro Finance LLC, Prologis Yen Finance LLC and Prologis Sterling Finance LLC are not provided.
17
NOTE 6. NONCONTROLLING INTERESTS
We report noncontrolling interests related to several entities we consolidate but of which we do not own 100% of the equity. These entities include two real estate partnerships that have issued limited partnership units to third parties. Depending on the specific partnership agreements, these limited partnership units are redeemable for cash or, at our option, shares of the Parent’s common stock, generally at a rate of one share of common stock to one limited partnership unit. We also consolidate certain entities in which we do not own 100% of the equity but the equity of these entities is not exchangeable into our common stock.
The noncontrolling interests of the Parent include the noncontrolling interests described above for the OP, as well as the limited partnership units in the OP that are not owned by the Parent. The outstanding limited partnership units receive quarterly cash distributions equal to the quarterly dividends paid on our common stock pursuant to the terms of the applicable partnership agreements.
The following table summarizes these entities (dollars in thousands):
Our Ownership Percentage
Noncontrolling Interests
Total Assets
Total Liabilities
Prologis U.S. Logistics Venture
55.0
3,060,590
3,091,941
6,930,519
7,014,774
141,043
149,823
Other consolidated entities (1)
various
251,296
231,106
3,330,805
3,031,608
506,049
399,277
10,261,324
10,046,382
647,092
549,100
Limited partners in Prologis, L.P. (2)(3)
1,266,354
1,342,585
NOTE 7. LONG-TERM COMPENSATION
Equity-Based Compensation Programs
Performance Stock Unit ("PSU") Program
PSUs are granted under the Company's 2020 Long-Term Incentive Plan and are settled in equity at the end of a three-year performance period, if applicable market-based performance hurdles are met. Such hurdles are based on a performance scale of Prologis’ percentile ranking in the Morgan Stanley Capital International US REIT Index (the “Index”) for a three-year performance period. Prologis must perform at the 55th percentile to earn a target award of 100.0%. The award is capped at 200.0% of the target for performance at or above the 85th percentile, and there is no payout in the event Prologis’ performance is below the 35th percentile. There is a proportional scaling between the 35th and the 85th percentiles, starting with 50.0% of the target being earned at the 35th percentile. If an award meets applicable market-based performance hurdles and is earned at the end of the initial three-year performance period, one-third of the award vests at the end of the performance period and the remaining award vests equally one and two years after the award is earned. The award is subject to an additional three-year holding requirement. Awards are in the form of common stock, restricted stock units ("RSUs") and LTIP Units.
The fair value of the awards is measured at the grant date and amortized over the period from the grant date to the date at which the awards vest, regardless of whether the market condition has been satisfied, which ranges from three to five years. We apply a discount to the fair value of the awards to reflect the illiquidity imposed by post-vesting holding periods, utilizing a weighted discount of 10% from valuation models that consider the length of the restriction, and the illiquidity associated with the awards. We granted PSUs for the 2025 – 2027 performance period in January 2025, with a fair value of $83.9 million. The fair value was calculated using a Monte Carlo valuation model that assumed a risk-free interest rate of 4.4% and an expected volatility of 29.0% for Prologis and 30.2% for the peer group companies.
Prologis Outperformance Plan (“POP”)
In prior years, we allocated participation points or a percentage of the compensation pool to participants under our POP, corresponding to three-year performance periods beginning each January 1. Commencing in 2024 for named executive officers (“NEOs”) and in 2025 for other employees who previously received participation points, those individuals received the PSUs discussed above. No new awards will be granted to these individuals under the POP. The RSUs and LTIP Units table below includes POP awards that were earned but are unvested, while any vested awards are reflected within the Consolidated Statements of Equity and Capital.
Other Equity-Based Compensation Programs
Our other equity-based compensation programs include: (i) the Prologis Promote Plan; (ii) the annual long-term incentive equity award program; and (iii) the annual bonus exchange program. Awards under these programs may be issued in the form of RSUs or LTIP Units at the participants' elections. RSUs and LTIP Units are valued based on the market price of the Parent’s common stock at the grant date, and the grant date fair value is recognized as compensation expense over the service period.
Summary of Award Activity
PSUs
The following table summarizes the activity for PSUs for the six months ended June 30, 2025 (units in thousands):
Unearned
Weighted Average Grant Date Fair Value
244
129.10
Granted
878
95.53
Earned
Forfeited
(6
1,116
102.88
RSUs and LTIP Units
The following table summarizes the activity for RSUs and LTIP Units for the six months ended June 30, 2025 (units in thousands):
RSUs
LTIP Units
Unvested
2,063
99.39
5,250
72.15
460
109.35
584
109.46
Conversion of earned PSUs
Vested
(473
125.99
(583
126.44
(66
121.33
1,984
94.63
5,251
70.27
NOTE 8. EARNINGS PER COMMON SHARE OR UNIT
We determine basic earnings per share or unit based on the weighted average number of shares of common stock or units outstanding during the period. We compute diluted earnings per share or unit based on the weighted average number of shares or units outstanding combined with the incremental weighted average effect from all outstanding potentially dilutive instruments.
The computation of our basic and diluted earnings per share and unit was as follows (in thousands, except per share and unit amounts):
Net earnings attributable to common stockholders – Basic
Net earnings attributable to exchangeable limited partnership units (1)
13,936
21,551
28,927
36,516
Adjusted net earnings attributable to common stockholders – Diluted
881,396
1,480,624
Incremental weighted average effect on exchange of limited partnership units (1)
22,731
23,224
23,115
23,465
Incremental weighted average effect of equity awards
4,675
3,700
4,577
4,162
Weighted average common shares outstanding – Diluted (2)
Net earnings per share attributable to common stockholders:
Basic
Diluted
Net earnings attributable to Class A Units
(3,516
(6,934
(8,094
(12,066
Net earnings attributable to common unitholders – Basic
580,144
874,262
1,182,058
1,468,177
Net earnings attributable to exchangeable other limited partnership units
381
Adjusted net earnings attributable to common unitholders – Diluted
Weighted average common partnership units outstanding – Basic
Incremental weighted average effect on exchange of Class A Units
5,767
7,343
6,468
7,736
Incremental weighted average effect on exchange of other limited partnership units
299
Incremental weighted average effect of equity awards of Prologis, Inc.
Weighted average common units outstanding – Diluted (2)
Net earnings per unit attributable to common unitholders:
Class A Units
Other limited partnership units
259
268
Equity awards
7,548
7,770
8,263
13,574
15,412
14,314
16,298
Common limited partnership units
16,964
15,582
16,647
15,430
30,538
30,994
30,961
31,728
NOTE 9. FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS
Derivative Financial Instruments
In the normal course of business, our operations are exposed to market risks, including the effect of changes in foreign currency exchange rates and interest rates. We may enter into derivative financial instruments to offset these underlying market risks. There have been no significant changes in our policy and strategy from what was disclosed in our Annual Report on Form 10-K for the year ended December 31, 2024.
The following table presents the fair value of our derivative financial instruments recognized within Other Assets and Other Liabilities in the Consolidated Balance Sheets (in thousands):
Asset
Liability
Undesignated derivatives
Foreign currency contracts
Forwards
Brazilian real
781
26,099
8,785
422
4,479
1,164
15,503
2,499
33,278
32,989
33,320
55,818
Swedish krona
567
5,689
4,642
108
Options
Mexican peso
6,444
1,814
Designated derivatives
Net investment hedges
30,922
2,837
351
2,510
5,454
Interest rate contracts
Cash flow hedges
187
451
9,587
Total fair value of derivatives
47,847
101,450
137,429
638
Undesignated Derivative Financial Instruments
Foreign Currency Contracts
The following table summarizes the activity of our undesignated foreign currency contracts for the six months ended June 30 (in millions, except for weighted average forward rates and number of active contracts):
CAD
EUR
GBP
JPY
Notional amounts at January 1 ($)
254
526
386
312
(27
1,451
213
524
442
384
1,619
New contracts ($)
57
157
53
370
102
98
67
333
Matured, expired or settled contracts ($)
(32
(60
(41
(38
(11
(182
(17
(56
(91
(127
(347
Notional amounts at June 30 ($)
279
623
(20
1,639
298
566
418
316
1,605
Weighted average forward rate at June 30
1.32
1.16
1.29
122.32
1.31
1.15
1.26
118.85
Active contracts at June 30
107
103
113
84
88
79
The following table summarizes the undesignated derivative financial instruments exercised and associated realized and unrealized gains (losses), respectively, in Foreign Currency, Derivative and Other Gains (Losses) and Other Income (Expense), Net in the Consolidated Statements of Income (in millions, except for number of exercised contracts):
Exercised contracts
Realized gains (losses) on the matured, expired or settled contracts
22
Unrealized gains (losses) on the change in fair value of outstanding contracts
(131
Designated Derivative Financial Instruments
Changes in the fair value of derivatives that are designated as net investment hedges ("NIHs") of our foreign operations and cash flow hedges ("CFHs") are recorded in Accumulated Other Comprehensive Income (Loss) (“AOCI/L”) in the Consolidated Balance Sheets and reflected within the AOCI/L table below.
The following table summarizes the activity of our foreign currency contracts designated as NIHs for the six months ended June 30 (in millions, except for weighted average forward rates and number of active contracts):
432
595
516
948
290
490
47
397
444
(163
(180
(343
(399
(798
542
742
594
1.36
1.30
Interest Rate Contracts
The following table summarizes the activity of our interest rate contracts designated as CFHs for the six months ended June 30 (in millions):
USD
280
700
550
1,250
139
875
1,071
246
300
546
(139
(1,080
(1,219
(700
(246
(550
(1,496
75
132
Designated Nonderivative Financial Instruments
The following table summarizes our debt and accrued interest, designated as a hedge of our net investment in international subsidiaries at the quarter ended (in millions):
1,867
1,763
1,316
758
The following table summarizes the unrealized gains (losses) in Foreign Currency, Derivative and Other Gains (Losses) and Other Income (Expense), Net in the Consolidated Statements of Income on the remeasurement of the unhedged portion of our euro-denominated and Chinese renminbi-denominated debt and accrued interest (in millions):
Unrealized gains (losses) on the unhedged portion
(49
(71
Accumulated Other Comprehensive Income (Loss) ("AOCI/L")
The change in AOCI/L in the Consolidated Statements of Equity during the periods presented was due to the following: (i) the currency translation adjustments ("CTA") that we recognize due to the translation of the financial statements of our consolidated subsidiaries, whose functional currency is not the U.S. dollar, into U.S. dollars; and (ii) the change in the fair value of the effective portion of our derivative financial instruments that have been designated as NIHs and CFHs and the translation of the hedged portion of our debt.
23
The following tables present these changes in AOCI/L (in thousands):
Unrealized gains (losses) on CFHs (1)
Our share of derivatives from unconsolidated co-investment ventures
Derivative NIHs
Debt designated as nonderivative NIHs (2)
CTA
Total AOCI/L
(17,411
15,526
327,064
266,682
(941,449
Other comprehensive income (loss), net
7,032
(2,720
(31,357
(167,297
(221,577
(415,919
(10,379
12,806
295,707
99,385
(1,163,026
Unrealized gains (losses) on CFHs
(26,648
13,563
326,688
268,471
(867,469
8,160
2,271
1,908
4,024
112,979
129,342
(18,488
15,834
328,596
272,495
(754,490
(11,659
12,652
341,852
327,897
(790,957
1,280
154
(46,145
(228,512
(372,069
(645,292
(45,744
8,414
310,526
254,102
(1,041,499
27,256
7,420
18,070
18,393
287,009
358,148
24
Fair Value Measurements
There have been no significant changes in our policy from what was disclosed in our Annual Report on Form 10-K for the year ended December 31, 2024.
Fair Value Measurements on a Recurring Basis
At June 30, 2025 and December 31, 2024, other than the derivatives discussed previously, we had no significant financial assets or financial liabilities that were measured at fair value on a recurring basis in the Consolidated Financial Statements. All of our derivatives held at June 30, 2025 and December 31, 2024, were classified as Level 2 of the fair value hierarchy.
Fair Value Measurements on Nonrecurring Basis
Acquired properties and assets we expect to sell or contribute are significant nonfinancial assets that met the criteria to be measured at fair value on a nonrecurring basis. At June 30, 2025 and December 31, 2024, we estimated the fair value of our properties using Level 2 or Level 3 inputs from the fair value hierarchy. See more information on our acquired properties in Note 2 and assets held for sale or contribution in Note 4.
Fair Value of Financial Instruments
At June 30, 2025 and December 31, 2024, the carrying amounts of certain financial instruments, including cash and cash equivalents, accounts and notes receivable, accounts payable and accrued expenses were representative of their fair values.
The differences in the fair value of our debt from the carrying value in the table below were the result of differences in interest rates or borrowing spreads that were available to us at June 30, 2025 and December 31, 2024, as compared with those in effect when the debt was issued or assumed, including lower borrowing spreads due to our credit ratings. See Note 5 for more information on our debt activity.
The following table reflects the carrying amounts and estimated fair values of our debt (in thousands):
Carrying Value
Fair Value
29,633,204
26,095,901
2,086,471
1,991,934
313,081
298,452
32,552,950
28,611,253
NOTE 10. REPORTABLE SEGMENTS
Our current business strategy includes two reportable segments: Real Estate (Rental Operations and Development) and Strategic Capital. We generate revenues, earnings, net operating income and cash flows through our segments, as follows:
Our management Executive Committee (“EC”) is our Chief Operating Decision Maker (“CODM”) and regularly reviews operating results and makes strategic and operating decisions with regards to assessing performance and allocating resources based on our two reportable segments. The EC consists of the Chief Executive Officer; Chief Operating Officer; Chief Financial Officer; Chief Investment Officer; Managing Director, Global Strategic Capital; President; Chief Human Resources Officer; Chief Legal Officer and Chief Energy and Sustainability Officer. The operating results reviewed by the EC include net operating income (“NOI”), the measure most consistent with U.S. GAAP.
NOI from the Real Estate Segment is calculated directly from the Consolidated Statements of Income as Rental Revenues and Development Management and Other Revenues less Rental Expenses and Other Expenses.
NOI from the Strategic Capital Segment is calculated directly from the Consolidated Statements of Income as Strategic Capital Revenues less Strategic Capital Expenses.
Our EC analyzes the NOI of each reportable segment on a quarterly basis comparing actuals to prior period actuals, along with forecasted future amounts and utilizes operating metrics to understand and evaluate the performance of our operations and to allocate resources.
Below we present: (i) each reportable segment’s revenues from external customers to Total Revenues; (ii) each reportable segment’s expenses to Total Expenses; (iii) each reportable segment’s net operating income from external customers, calculated as each reportable segment's revenues less segment expenses, to Operating Income and Earnings Before Income Taxes; and (iv) each reportable segment’s assets to Total Assets.
The applicable components of Total Revenues, Total Expenses, Operating Income, Earnings Before Income Taxes and Total Assets in the Consolidated Financial Statements are allocated to each reportable segment’s revenues, expenses, net operating income and assets.
Items that are not directly assignable to a reportable segment, are not allocated but reflected as non-segment items (general and administrative expenses and real estate adjustments for depreciation and gains and losses on contributions and sales) due to how our CODM utilizes segment information for planning and execution of our business strategy.
The following reportable segment net operating income and assets are presented in thousands:
Real estate segment:
1,940,600
1,781,805
3,854,493
3,539,176
Other Americas
45,913
31,159
92,236
60,882
32,966
25,695
58,393
54,428
17,228
14,553
30,111
26,935
Total real estate segment
2,036,707
1,853,212
4,035,233
3,681,421
Strategic capital segment:
49,710
45,026
98,078
91,129
22,605
41,158
43,779
57,443
54,069
47,102
105,080
91,902
20,778
21,456
41,364
42,680
Total strategic capital segment
U.S. (1)
(464,115
(435,804
(935,327
(880,554
(9,855
(6,796
(18,182
(13,626
(19,894
(8,940
(33,427
(18,899
(5,805
(5,139
(10,699
(10,101
(499,669
(456,679
(997,635
(923,180
(30,508
(34,722
(59,041
(75,679
(6,551
(6,699
(9,533
(13,021
(18,071
(20,077
(35,648
(41,785
(9,787
(9,038
(21,472
(18,862
(64,917
(70,536
(125,694
(149,347
(564,586
(527,215
(1,123,329
(1,072,527
Segment net operating income:
1,476,485
1,346,001
2,919,166
2,658,622
36,058
24,363
74,054
47,256
13,072
16,755
24,966
35,529
11,423
9,414
19,412
16,834
1,537,038
1,396,533
3,037,598
2,758,241
19,202
10,304
39,037
15,450
16,054
34,459
34,246
44,422
35,998
27,025
69,432
50,117
10,991
12,418
19,892
23,818
82,245
84,206
162,607
133,807
Total segment net operating income
1,619,283
1,480,739
3,200,205
2,892,048
Non-segment items:
General and administrative expenses
(106,871
(106,596
(221,572
(217,887
Depreciation and amortization expenses
(657,221
(637,305
(1,309,279
(1,274,810
Segment assets:
77,795,247
76,857,293
3,219,239
2,814,141
3,054,882
2,554,514
1,008,633
719,810
85,078,001
82,945,758
Strategic capital segment: (2)
10,499
25,280
174
167
35,953
35,946
Total segment assets
85,113,954
82,981,704
665,500
700,655
Total non-segment items
12,603,096
12,347,205
NOTE 11. SUPPLEMENTAL CASH FLOW INFORMATION
Our significant noncash investing and financing activities for the six months ended June 30, 2025 and 2024 included the following:
We paid $512.8 million and $407.9 million for interest, net of amounts capitalized, during the six months ended June 30, 2025 and 2024, respectively.
We paid $91.6 million and $86.5 million for income taxes, net of refunds, during the six months ended June 30, 2025 and 2024, respectively.
Report of Independent Registered Public Accounting Firm
To the Stockholders and Board of Directors
Results of Review of Interim Financial Information
We have reviewed the consolidated balance sheet of Prologis, Inc. and subsidiaries (the Company) as of June 30, 2025, the related consolidated statements of income, comprehensive income, and equity for the three-month and six-month periods ended June 30, 2025 and 2024, the related consolidated statements of cash flows for the six-month periods ended June 30, 2025 and 2024, and the related notes (collectively, the consolidated interim financial information). Based on our reviews, we are not aware of any material modifications that should be made to the consolidated interim financial information for it to be in conformity with U.S. generally accepted accounting principles.
We have previously audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated balance sheet of the Company as of December 31, 2024, and the related consolidated statements of income, comprehensive income, equity, and cash flows for the year then ended (not presented herein); and in our report dated February 14, 2025, we expressed an unqualified opinion on those consolidated financial statements. In our opinion, the information set forth in the accompanying consolidated balance sheet as of December 31, 2024 is fairly stated, in all material respects, in relation to the consolidated balance sheet from which it has been derived.
Basis for Review Results
This consolidated interim financial information is the responsibility of the Company’s management. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our reviews in accordance with the standards of the PCAOB. A review of consolidated interim financial information consists principally of applying analytical procedures and making inquiries of persons responsible for financial and accounting matters. It is substantially less in scope than an audit conducted in accordance with the standards of the PCAOB, the objective of which is the expression of an opinion regarding the financial statements taken as a whole. Accordingly, we do not express such an opinion.
/s/ KPMG LLP
Denver, ColoradoJuly 29, 2025
To the Partners of Prologis, L.P. and the Board of Directors of Prologis, Inc.:
We have reviewed the consolidated balance sheet of Prologis, L.P. and subsidiaries (the Operating Partnership) as of June 30, 2025, the related consolidated statements of income, comprehensive income, and capital, for the three-month and six-month periods ended June 30, 2025 and 2024, the related consolidated statements of cash flows for the six-month periods ended June 30, 2025 and 2024, and the related notes (collectively, the consolidated interim financial information). Based on our reviews, we are not aware of any material modifications that should be made to the consolidated interim financial information for it to be in conformity with U.S. generally accepted accounting principles.
We have previously audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated balance sheet of the Operating Partnership as of December 31, 2024, and the related consolidated statements of income, comprehensive income, capital, and cash flows for the year then ended (not presented herein); and in our report dated February 14, 2025, we expressed an unqualified opinion on those consolidated financial statements. In our opinion, the information set forth in the accompanying consolidated balance sheet as of December 31, 2024 is fairly stated, in all material respects, in relation to the consolidated balance sheet from which it has been derived.
This consolidated interim financial information is the responsibility of the Operating Partnership’s management. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Operating Partnership in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
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ITEM 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations
The following should be read in conjunction with the Consolidated Financial Statements and related Notes included in Item 1 of this report and our Annual Report on Form 10-K for the year ended December 31, 2024, as filed with the United States (“U.S.”) Securities and Exchange Commission (“SEC”).
The statements in this report 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,” “aims,” 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, 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 or 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 (“REIT”) 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 and management of 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; (x) risks related to global pandemics; and (xi) those additional factors discussed under Part I, Item 1A. Risk Factors in our Annual Report on Form 10-K for the year ended December 31, 2024. We undertake no duty to update any forward-looking statements appearing in this report except as may be required by law.
Prologis, Inc. is a self-administered and self-managed REIT and is the sole general partner of Prologis, L.P. through which it holds substantially all of its assets. We operate Prologis, Inc. and Prologis, L.P. as one enterprise and, therefore, our discussion and analysis refers to Prologis, Inc. and its consolidated subsidiaries, including Prologis, L.P. We invest in real estate through wholly owned subsidiaries and other entities through which we co-invest with partners and investors ("co-investment ventures"). We have a significant ownership interest in the co-investment ventures, which are either consolidated or unconsolidated based on our level of control of the entity.
We operate, manage and measure the operating performance of our properties on an owned and managed (“O&M”) basis. Our O&M portfolio includes our consolidated properties as well as properties owned by our unconsolidated co-investment ventures, which we manage. We make operating decisions based on our total O&M portfolio as we manage the properties without regard to their ownership. We also evaluate our results based on our proportionate economic ownership of each property included in the O&M portfolio (“our share”).
Included in our discussion below are references to funds from operations (“FFO”) and net operating income (“NOI”), neither of which are United States ("U.S.") generally accepted accounting principles (“GAAP”). See below for a reconciliation of Net Earnings Attributable to Common Stockholders/Unitholders in the Consolidated Statements of Income to our FFO measures and a reconciliation of NOI to Operating Income in the Consolidated Statements of Income, the most directly comparable GAAP measures.
MANAGEMENT'S OVERVIEW
Prologis is the global leader in logistics real estate, operating in high-barrier, high-growth markets across 20 countries on four continents. Our portfolio is concentrated in key commercial hubs, strategically located near end consumers to support the efficient flow of goods. In addition to owning, managing and developing high-quality logistics facilities, we offer integrated infrastructure solutions that help customers operate with greater efficiency, flexibility and resiliency. Our services support the evolving needs of modern supply chains, including the growing integration of physical and digital infrastructure and rising demand for sustainable operations.
Logistics supply chains remain vital to both our customers and the global economy. Long-term trends, including the growth of e-commerce and modernization of supply chains, continue to drive demand for additional space to enhance resiliency and distribution capabilities. This demand has led to strong rent growth and historically low vacancy rates in recent years. We believe this demand is driven by three primary factors: (i) our customers repositioning their supply chains to meet rising e-commerce and service expectations; (ii) growth in consumption; and (iii) a growing focus on supply chain efficiency. We believe these factors will sustain demand and low vacancy rates over the long term. In the near term, while tariff policy has heightened economic uncertainty since April, our proprietary
metrics and dialogue with customers indicate that many are moving forward with decision making. We believe we are well-positioned to support our customers as they navigate the uncertainty and changes that may occur in the supply chain.
Our teams actively manage our portfolio by delivering comprehensive real estate services, including leasing, property management, development, acquisitions and dispositions. We invest significant capital into new logistics properties through acquisitions and development activity, including both built-to-suit and speculative development and redevelopment of properties into industrial properties and data centers. Proceeds from property dispositions, typically through contributions of newly developed properties to our co-investment ventures or sales of non-strategic assets to third parties, allow us to recycle capital back into our ongoing investment activities.
While the majority of our properties in the U.S. are wholly owned, we also hold significant ownership interest in properties both in the U.S. and internationally through our investment in co-investment ventures. Partnering with many of the world’s largest institutional investors through co-investment ventures allows us to expand our investment capacity, enhance and diversify our real estate returns and mitigate our exposure to foreign currency movements.
Our scale and customer-focused strategy have driven us to expand the services we offer. Our 1.3 billion square foot portfolio serves as the foundation for a comprehensive platform of solutions that address the challenges our customers face in global fulfillment today. Through Prologis Essentials, we deliver solutions to support our customers’ operational, energy and sustainability needs. Our customer experience teams, proprietary technology and strategic partnerships are central to every aspect of the Prologis Essentials platform. These resources allow us to provide customers with unique and actionable insights and tools to help them advance sustainability goals and improve operational efficiency. In addition, the principles of environmental, social and governance are embedded in our business strategy through an integrated approach to global impact and sustainability, which we believe creates value for our customers, investors, employees and communities.
Our Global Presence
At June 30, 2025, we owned or had investments in, on a wholly owned basis or through co-investment ventures, properties and development projects expected to total approximately 1.3 billion square feet across the following geographies:
Throughout this discussion, we reflect amounts in the U.S. dollar, our reporting currency. Included in these amounts are consolidated and unconsolidated investments denominated in foreign currencies, principally the British pound sterling, Canadian dollar, euro and Japanese yen that are impacted by fluctuations in exchange rates when translated to U.S. dollars. We mitigate our exposure to foreign currency fluctuations by investing outside the U.S. through co-investment ventures, borrowing in the functional currency of our subsidiaries and utilizing derivative financial instruments.
32
Our business comprises two reportable segments: Real Estate (Rental Operations and Development) and Strategic Capital.
Below is information summarizing consolidated activity within our segments (in millions):
Real Estate Segment
Rental Operations. Rental operations comprise the largest component of our reportable segments and generally contributes 90% to 95% of our consolidated revenues, earnings and FFO. We collect rent from our customers through operating leases, including reimbursements for the majority of our property operating costs. Through our global footprint, we have a diversified lease portfolio and our revenues from in-place leases are contractual with fixed or inflation-linked escalations. For the trailing twelve months ended June 30, 2025, the weighted average lease term for leases commenced in our consolidated operating portfolio was 70 months. We expect to generate earnings growth by increasing rents, maintaining high occupancy rates and controlling expenses. The primary driver of our revenue growth will be the rolling of in-place leases to current market rents upon lease expiration. We believe our active portfolio management, combined with the skills of our property, leasing, maintenance, energy, sustainability and risk management teams allow us to maximize NOI across our portfolio. Substantially all of our consolidated rental revenue, NOI and cash flows from rental operations are generated in the U.S.
Development. Our development business provides the opportunity to profitably build modern logistics facilities that address the evolving requirements of our customers while deepening our presence in our target markets. We believe we have a competitive advantage due to: (i) the strategic locations of our global land bank and redevelopment sites for the development of future industrial properties or data centers; (ii) the development expertise of our local teams; (iii) the depth of our customer relationships; (iv) our ability to integrate sustainable design features that improve operational efficiency for our customers; and (v) our procurement capabilities that enable us to secure high-demand construction materials at a lower cost. Successful development and redevelopment projects contribute significantly to earnings growth as they are leased, begin generating income and increase the value of our Real Estate Segment. In general, we develop properties in the U.S. to hold for the long term or to contribute to our unconsolidated co-investment ventures, and outside the U.S. primarily to contribute to these ventures.
Strategic Capital Segment
We partner with many of the world’s largest institutional investors through co-investment ventures. The business is capitalized through private and public equity, and is comprised of 95% open-ended ventures, long-term ventures and two publicly traded vehicles (Nippon Prologis REIT, Inc. in Japan and FIBRA Prologis, which controls and owns 90% of Terrafina, also a publicly traded FIBRA in Mexico). We align our interests with our partners by holding significant ownership interests in the co-investment ventures. Nine of the co-investment ventures are unconsolidated entities, and one is consolidated, with our ownership in the co-investment ventures ranging from 15% to 55%. This structure allows us to reduce our exposure to foreign currency fluctuations for non-U.S. investments. Management of the unconsolidated co-investment ventures comprises our Strategic Capital Segment.
This segment generates durable, long-term cash flows and generally contributes 5% to 10% of our consolidated revenues, earnings and FFO, excluding promotes. We generate strategic capital revenue from our unconsolidated co-investment ventures, principally through asset management and property management services. Revenue earned from asset management fees is primarily driven by the quarterly valuation of the real estate properties owned by the respective ventures. We earn additional revenues by providing leasing, acquisition, construction management, development and disposition services. The majority of the strategic capital revenues are generated outside the U.S. In certain ventures, we also have the ability to earn revenues through incentive fees (“promotes” or
“promote revenues”) periodically during the life of a venture, upon liquidation of a venture or upon stabilization of individual venture assets, based primarily on the total return of the investments over certain financial hurdles. Promote revenue is recognized when earned, either at the end of the promote period or upon liquidation or stabilization. We plan to grow this business and increase revenues by increasing our assets under management in existing and new ventures.
FUTURE GROWTH
We believe that the quality and scale of our portfolio, our ability to develop our land bank and redevelopment sites, our strategic capital business, the depth of our customer relationships and the strength of our balance sheet are differentiators that allow us to drive growth in revenues, NOI, earnings, FFO and cash flows.
Rent change 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 previous net effective rental rates for the same respective spaces.
Based on our current estimates, our consolidated land and other real estate investments, including options and CLPs, have the potential to support the development of $36.4 billion ($41.5 billion on an O&M basis) of TEI of newly developed buildings. We measure the estimated value creation of a development project as the stabilized value above our TEI. As properties are completed and leased, we expect to capture the value creation principally through gains realized upon contributing these properties to unconsolidated co-investment ventures and through increases in the NOI of the consolidated portfolio.
SUMMARY OF THE SIX MONTHS ENDED JUNE 30, 2025
Our operating results and leasing activity were strong during the six months ended June 30, 2025. Due to increases in market rents over the past several years, our existing lease mark-to-market continued to drive rent change on rollover and same-store growth in our O&M portfolio. This lease mark-to-market has remained meaningfully positive despite recent quarters of lower or even negative market rental growth, due to accumulated rent growth in preceding years. The occupancy of our operating portfolio was 95.0% at June 30, 2025 and rent change on leases that commenced during the six months ended June 30, 2025 was 53.6% on a net effective basis, both metrics based on our ownership share.
While tariff policy has introduced economic uncertainty since April, leasing activity accelerated over the months of the second quarter in our consolidated portfolio, indicating that many customers are moving forward with decision making. This demand was also reflected in new development activity, with consolidated development starts totaling $867 million in the second quarter, of which 63.4% were build-to-suit projects. While we believe we are well-positioned to grow revenue over the long-term given the upside opportunity in our in-place leases, the potential impact of ongoing economic uncertainty on our business, future financial condition and operating results remains difficult to predict.
We completed the following significant activities in 2025, as described in the Notes to the Consolidated Financial Statements:
750
1,770
(1) The exchange rate used to calculate into U.S. dollars was the spot rate at the settlement date of each issuance.
RESULTS OF OPERATIONS – SIX MONTHS ENDED JUNE 30, 2025 AND 2024
We evaluate our business operations based on the NOI of our two reportable segments: Real Estate (Rental Operations and Development) and Strategic Capital. NOI by segment is a non-GAAP performance measure that is calculated using revenues and expenses directly from our financial statements. We consider NOI by segment to be an appropriate supplemental measure of our performance because it helps management and investors understand our operating results.
Below is our NOI by segment per the Consolidated Financial Statements and a reconciliation of NOI by segment to Operating Income per the Consolidated Financial Statements for the six months ended June 30 (in millions):
Rental revenues
4,013
3,680
Development management and other revenues
Rental expenses
(976
(899
Other expenses
(22
(24
Real Estate Segment – NOI
3,038
2,758
Strategic capital revenues
288
283
Strategic capital expenses
(126
(149
Strategic Capital Segment – NOI
162
(222
(218
(1,309
(1,275
1,669
1,399
38
128
217
1,791
1,744
See Note 10 to the Consolidated Financial Statements for more information on our segments and a reconciliation of each reportable segment’s NOI to Operating Income and Earnings Before Income Taxes.
This reportable segment principally includes rental revenue and rental expenses recognized from our consolidated properties. This segment also includes the operating results of our renewable energy assets. We allocate the costs of our property management and leasing functions to the Real Estate Segment through Rental Expenses and the Strategic Capital Segment through Strategic Capital Expenses, both in the Consolidated Financial Statements, based on the square footage of the relative portfolios. In addition, this segment is impacted by our development, acquisition and disposition activities.
Below are the components of Real Estate Segment NOI for the six months ended June 30, derived directly from line items in the Consolidated Financial Statements (in millions):
The $280 million change in Real Estate Segment (“RES”) NOI for the six months ended June 30 compared to the same period in 2024, was impacted by the following activities (in millions):
Below are key operating metrics of our consolidated operating portfolio.
Development Activity
The following table summarizes consolidated development activity for the six months ended June 30 (dollars and square feet in millions):
Starts:
Number of new development buildings started during the period
TEI
1,513
547
Percentage of build-to-suits based on TEI
69.6
19.6
Stabilizations:
Number of development buildings stabilized during the period
41
1,135
2,533
55.5
34.3
Weighted average stabilized yield (1)
6.9
5.8
Estimated value at completion
1,446
2,886
Estimated weighted average margin (2)
27.4
13.9
Estimated value creation
311
353
At June 30, 2025, the consolidated development portfolio, including properties under development and pre-stabilized properties, was expected to be completed before September 2027 with a TEI of $5.2 billion and was 36.5% leased. This includes the development of data centers with an aggregate TEI of $0.9 billion, on a consolidated basis. Our investment in the development portfolio was $2.9 billion at June 30, 2025.
Capital Expenditures
We capitalize costs incurred in improving and leasing our consolidated operating properties and other real estate investments as part of the investment basis or within Other Assets in the Consolidated Balance Sheets. The following graph summarizes recurring capitalized expenditures and leasing costs during each quarter and excludes development costs and spend subsequent to stabilization that is structural in nature and non-recurring:
This reportable segment includes revenues from asset management and property management services, transactional services for acquisition, disposition and leasing activity and promote revenue earned from the unconsolidated co-investment ventures. Revenues associated with the Strategic Capital Segment fluctuate because of changes in the size of the portfolios through acquisitions and
dispositions, the fair value of the properties, timing of promotes, foreign currency exchange rates and other transactional activity. These revenues are reduced by the direct costs associated with the asset and property-level management expenses for the properties owned by these ventures. We allocate the costs of our property management and leasing functions to the Strategic Capital Segment through Strategic Capital Expenses and to the Real Estate Segment through Rental Expenses both in the Consolidated Financial Statements, based on the square footage of the relative portfolios. For further details regarding the key property information and summarized financial condition and operating results of our unconsolidated co-investment ventures, refer to Note 3 to the Consolidated Financial Statements.
Below are the components of Strategic Capital Segment NOI for the six months ended June 30, derived directly from the line items in the Consolidated Financial Statements (in millions):
Below is additional detail of our Strategic Capital Segment revenues, expenses and NOI for the six months ended June 30 (in millions):
Strategic capital revenues ($)
Recurring fees (2)
82
92
83
Transactional fees (3)
Promote revenue (4)
Total strategic capital revenues ($)
44
105
43
Strategic capital expenses ($) (4)
(59
(75
(10
(13
(36
(42
(21
(19
Strategic Capital Segment – NOI ($)
39
69
The Prologis Promote Plan ("PPP") awards up to 25% of the third-party portion of the promotes earned by us from the co-investment ventures to our employees. This award is issued as a combination of cash and equity-based awards, pursuant to the terms of the PPP and expensed through Strategic Capital Expenses in the Consolidated Statements of Income, as vested. As a result, expenses recognized in the current period may relate to promote revenues recognized in prior periods.
G&A Expenses
G&A expenses were $222 million and $218 million for the six months ended June 30, 2025 and 2024, respectively. We capitalize certain internal costs that are incremental and directly related to our development and building improvement activities.
The following table summarizes capitalized G&A for the six months ended June 30 (dollars in millions):
Building and land development activities
72
Operating building improvements and other
Total capitalized G&A expenses
Capitalized compensation and related costs as a percent of total
21.0
24.6
Depreciation and Amortization Expenses
Depreciation and amortization expenses were $1.3 billion for both the six months ended June 30, 2025 and 2024.
The $34 million change in depreciation and amortization expenses for the six months ended June 30, 2025 compared to the same period in 2024, was impacted by the following items (in millions):
Gains on Real Estate Transactions, Net
Gains on the disposition of development properties and land were $38 million and $128 million for the six months ended June 30, 2025 and 2024, respectively, principally from the contribution of properties we developed to unconsolidated co-investment ventures in Europe in 2025 and 2024, and from sales to third parties in the U.S. in 2025.
Gains on other dispositions of investments in real estate were $84 million and $217 million for the six months ended June 30, 2025 and 2024, respectively, primarily from sales of properties to third parties.
Historically, we have utilized the proceeds from these dispositions primarily to fund our acquisition and development activities. See Note 2 to the Consolidated Financial Statements for further information on these transactions.
Our Owned and Managed (“O&M”) Operating Portfolio
We manage our business and review our operating fundamentals on an O&M basis, which includes our consolidated properties and properties owned by our unconsolidated co-investment ventures. We believe reviewing the results in this way allows management to understand performance more broadly as we manage the properties without regard to their ownership. We do not control the unconsolidated co-investment ventures for purposes of GAAP and the presentation of the ventures’ operating information does not represent a legal claim.
Our O&M operating portfolio excludes our development portfolio, value-added properties, non-industrial properties and properties we consider non-strategic that we do not intend to hold for the long term, including those classified as held for sale or within other real estate investments. Value-added properties are properties we have either acquired at a discount and believe we could provide greater returns post-stabilization or properties we expect to repurpose to higher uses. See below for information on our O&M operating portfolio (square feet in millions):
Number of Properties
SquareFeet
Percentage Occupied
Consolidated
3,003
651
94.7%
2,981
644
95.4%
Unconsolidated
2,437
553
95.7%
2,423
548
96.6%
5,440
1,204
95.1%
5,404
1,192
95.9%
Below are the key leasing metrics of our O&M operating portfolio.
Same Store Analysis
Our same store metrics are non-GAAP financial measures, which are commonly used in the real estate industry and expected from the financial community, presented 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 June 30, 2025 as the properties in our O&M 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 O&M 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 period. 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 for the three months ended June 30 (dollars in millions):
Percentage
Change
Reconciliation of Consolidated Property NOI to Same Store Property NOI measures:
2,026
1,852
(488
(445
Consolidated Property NOI
1,538
1,407
Adjustments to derive same store results:
Property NOI from consolidated properties not included in same store portfolio and other adjustments (1)
(117
Property NOI from unconsolidated co-investment ventures included in same store portfolio (1)(2)
894
832
Third parties' share of Property NOI from properties included in same store portfolio (1)(2)
(706
(683
Prologis Share of Same Store Property NOI – Net Effective (2)
1,508
1,439
4.8
Consolidated properties straight-line rent and fair value lease amortization included in same store portfolio (3)
(121
Unconsolidated co-investment ventures straight-line rent and fair value lease amortization included in same store portfolio (3)
(30
Third parties' share of straight-line rent and fair value lease amortization included in same store portfolio (2)(3)
Prologis Share of Same Store Property NOI – Cash (2)(3)
1,374
1,310
4.9
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.
We manage our business and compensate our executives based on the same store results of our O&M 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.
Other Components of Income (Expense)
Earnings from Unconsolidated Entities, Net
The earnings we recognize from unconsolidated entities can be impacted by: (i) the size, rental rates and occupancy of the portfolio of properties owned by each venture; (ii) interest expense based on the size and terms of the debt; (iii) gains or losses from dispositions of properties, impairments and extinguishments of debt; (iv) our ownership interest in each venture; (v) other variances in revenues and
42
expenses of each venture; and (vi) fluctuations in foreign currency exchange rates used to translate our share of net earnings to U.S. dollars.
We recognized net earnings from unconsolidated entities, which are primarily accounted for using the equity method, of $176 million and $175 million for the six months ended June 30, 2025 and 2024, respectively.
See the discussion of our unconsolidated entities above in the Strategic Capital Segment discussion and in Note 3 to the Consolidated Financial Statements for a further breakdown of our share of net earnings recognized.
Interest Expense
The following table details our net interest expense for the six months ended June 30 (dollars in millions):
Gross interest expense
423
Amortization of debt discount and debt issuance costs, net
Capitalized amounts
(50
Net interest expense
484
Weighted average effective interest rate during the period
3.0
Interest expense increased during the six months ended June 30, 2025, as compared to the same period in 2024, principally due to the issuance of senior notes to finance our acquisition and development activities and higher interest rates. We issued $1.8 billion of senior notes during the six months ended June 30, 2025 and $4.2 billion during the year ended December 31, 2024, with a weighted average interest rate of 4.8% at the issuance date in both years.
See Note 5 to the Consolidated Financial Statements and the Liquidity and Capital Resources section below, for further discussion of our debt and borrowing costs.
Foreign Currency, Derivative and Other Gains (Losses) and Other Income (Expense), Net
We are exposed to foreign currency exchange risk related to investments in and earnings from our foreign investments. We primarily hedge our foreign currency risk related to our investments by borrowing in the currencies in which we invest thereby providing a natural hedge. We have issued debt in a currency that is not the same functional currency of the borrowing entity and have designated a portion of the debt as a nonderivative net investment hedge. We recognize the remeasurement and settlement of the translation adjustment on the unhedged portion of the debt and accrued interest in unrealized gains or losses. We may use derivative financial instruments to manage foreign currency exchange rate risk related to our earnings. We recognize the change in fair value of the undesignated derivative contracts in unrealized gains and losses. Upon settlement of these transactions, we recognize realized gains or losses.
We recognized foreign currency, derivative and other gains (losses) and other income (expense), net, of $154 million in losses and $101 million in gains for the six months ended June 30, 2025 and 2024, respectively. Included in these amounts was interest income earned on short-term investments.
The following table details our foreign currency and derivative gains (losses), net for the six months ended June 30 included in earnings (in millions):
Realized foreign currency and derivative gains (losses), net:
Gains (losses) on the settlement of undesignated derivatives
Total realized foreign currency and derivative gains (losses), net
Unrealized foreign currency and derivative gains (losses), net:
Gains (losses) on the change in fair value of undesignated derivatives and unhedged debt
(202
Gains (losses) on remeasurement of certain assets and liabilities
Total unrealized foreign currency and derivative gains (losses), net
(193
Total foreign currency and derivative gains (losses), net
80
See Note 9 to the Consolidated Financial Statements for more information about our derivative and nonderivative transactions.
Income Tax Expense
We recognize income tax expense related to our taxable REIT subsidiaries and in the local, state and foreign jurisdictions in which we operate. Our current income tax expense (benefit) fluctuates from period to period based primarily on the timing of our taxable income,
including gains on the disposition of properties, fees earned from the co-investment ventures and taxable earnings from unconsolidated co-investment ventures. Deferred income tax expense (benefit) is generally a function of the period’s temporary differences and the utilization of net operating losses generated in prior years that had been previously recognized as deferred income tax assets in taxable subsidiaries.
The following table summarizes our income tax expense (benefit) for the six months ended June 30 (in millions):
Current income tax expense (benefit):
Income tax expense (benefit)
63
60
Income tax expense (benefit) on dispositions
Total current income tax expense (benefit)
65
Deferred income tax expense (benefit):
Total deferred income tax expense (benefit)
Total income tax expense (benefit)
76
Net Earnings Attributable to Noncontrolling Interests
Net earnings attributable to noncontrolling interests represents the third-party investors’ share of the earnings generated in consolidated entities in which we do not own 100% of the equity, reduced by the third-party share of fees or promotes we earned during the period. We had net earnings attributable to noncontrolling interests of $98 million and $95 million for the six months ended June 30, 2025 and 2024, respectively. Included in these amounts were $29 million and $36 million for the six months ended June 30, 2025 and 2024, respectively, of net earnings attributable to the common limited partnership unitholders of Prologis, L.P.
See Note 6 to the Consolidated Financial Statements for further information on our noncontrolling interests.
Other Comprehensive Income (Loss)
The key driver of changes in Accumulated Other Comprehensive Income (Loss) (“AOCI/L”) in the Consolidated Financial Statements during the six months ended June 30, 2025 and 2024, was the currency translation adjustment derived from changes in exchange rates during both periods principally on our net investments in real estate outside the U.S. and the borrowings we issue in the functional currencies of the countries where we invest. These borrowings serve as a natural hedge of our foreign investments. In addition, we use derivative financial instruments, such as foreign currency contracts to manage foreign currency exchange rate risk related to our foreign investments and interest rate contracts to manage interest rate risk, that when designated the change in fair value is included in AOCI/L.
See Note 9 to the Consolidated Financial Statements for more information on changes in other comprehensive income and about our derivative and nonderivative transactions.
RESULTS OF OPERATIONS – THREE MONTHS ENDED JUNE 30, 2025 AND 2024
Except as separately discussed above, the changes in comprehensive income attributable to common stockholders and unitholders and its components for the three months ended June 30, 2025, as compared to the three months ended June 30, 2024, are similar to the changes for the six-month periods ended on the same dates.
LIQUIDITY AND CAPITAL RESOURCES
Overview
We consider our ability to generate cash from operating activities, distributions from our co-investment ventures, contributions and dispositions of properties and available financing sources to be adequate to meet our anticipated future development, acquisition, operating, debt service, dividend and distribution requirements.
Near-Term Principal Cash Sources and Uses
In addition to dividends and distributions, we expect our primary cash needs will consist of the following:
We expect to fund our cash needs principally from the following sources (subject to market conditions):
In the long term, we may also voluntarily repurchase our outstanding debt or equity securities (depending on prevailing market conditions, our liquidity, contractual restrictions and other factors) through cash purchases, open-market purchases, privately negotiated transactions, tender offers or otherwise. We may also fund our cash needs from the issuance of equity securities, subject to market conditions, and through the sale of a portion of our investments in co-investment ventures.
The following table summarizes information about our consolidated debt by currency (dollars in millions):
1,876
1,715
1,736
1,262
11,494
9,900
3,189
2,911
15,719
14,458
653
633
Total debt (1)
34,667
30,879
45
Our credit ratings at June 30, 2025, were A and A2 from Standard & Poor's and Moody's, respectively, each with a stable outlook. These ratings allow us to borrow at favorable interest rates. Adverse changes to our credit ratings could negatively affect our business, particularly our refinancing and capital markets activities, our ability to manage debt maturities, our future growth and our development and acquisition activity. A securities rating is not a recommendation to buy, sell or hold securities and is subject to revision or withdrawal at any time by the rating organization.
At June 30, 2025, we were in compliance with all of our financial debt covenants. These covenants include a number of customary financial covenants, such as maintaining debt service coverage ratios, leverage ratios and fixed charge coverage ratios.
See Note 5 to the Consolidated Financial Statements for further discussion on our debt.
Equity Commitments Related to Certain Co-Investment Ventures
Certain co-investment ventures have equity commitments from us and our venture partners. Our venture partners fulfill their equity commitment with cash. We may fulfill our equity commitment through contributions of properties or cash.
The following table summarizes the remaining equity commitments at June 30, 2025 (dollars in millions):
Equity Commitments (1)
Prologis
Venture Partners
Expiration Date
Prologis Targeted U.S. Logistics Fund
2028 (2)
Prologis Brazil Logistics Venture
2026
Prologis European Logistics Fund
177
Prologis Japan Core Logistics Fund
467
558
2033
Prologis China Logistics Venture
71
404
475
2025 – 2028
193
1,220
1,413
See the Cash Flow Summary below for more information about our investment activity in our co-investment ventures.
Cash Flow Summary
The following table summarizes our cash flow activity for the six months ended June 30 (in millions):
2,402
2,142
(2,585
(1,708
(94
(353
Net increase (decrease) in cash and cash equivalents, including the effect of foreign currency exchange rates on cash
68
Operating Activities
Cash provided by and used in operating activities, exclusive of changes in receivables and payables, was impacted by the following significant activities during the six months ended June 30, 2025 and 2024:
46
Investing Activities
Cash provided by investing activities is driven by proceeds from the sale of real estate assets that include the contribution of properties we developed to our unconsolidated co-investment ventures as well as the sale of non-strategic operating properties. Cash used in investing activities is principally driven by our capital deployment activities of investing in real estate development, acquisitions and capital expenditures as discussed above. This activity includes land for future development, operating properties, other real estate assets and real estate portfolios. See Note 2 to the Consolidated Financial Statements for further information on these activities. In addition, the following significant transactions also impacted our cash used in and provided by investing activities during the six months ended June 30, 2025 and 2024:
Financing Activities
Cash provided by and used in financing activities is principally driven by proceeds from and payments on credit facilities, commercial paper and other debt, along with dividends paid on common and preferred stock and noncontrolling interest contributions and distributions. Our credit facilities and our commercial paper support our cash needs for general corporate purposes on a short-term basis. The maturities of the borrowings under the credit facilities and the notes under the commercial paper programs generally range from overnight to three months.
Our repurchase of and payments on debt and proceeds from the issuance of debt consisted of the following activity for the six months ended June 30 (in millions):
Repurchase of and payments on debt (including extinguishment costs)
Regularly scheduled debt principal payments and payments at maturity
Secured mortgage debt
89
Term loans
500
916
1,759
2,883
129
1,778
3,017
Unconsolidated Co-Investment Venture Debt
We had investments in and advances to our unconsolidated co-investment ventures of $9.8 billion at June 30, 2025. These ventures had total third-party debt of $18.6 billion at June 30, 2025 with a weighted average remaining maturity of 6 years and weighted average interest rate of 3.4%. The weighted average loan-to-value ratio for all unconsolidated co-investment ventures was 29.2% at June 30, 2025 based on gross book value. Loan-to-value, a non-GAAP measure, was calculated as the percentage of total third-party debt to the gross book value of real estate for each venture and weighted based on the cumulative gross book value of all unconsolidated co-investment ventures.
At June 30, 2025, we did not guarantee any third-party debt of the unconsolidated co-investment ventures.
Dividend and Distribution Requirements
Our dividend policy on our common stock is to distribute a percentage of our cash flow to ensure that we will meet the dividend requirements of the Internal Revenue Code ("IRC"), relative to maintaining our REIT status, while still allowing us to retain cash to fund our capital deployment and other investment activities.
Under the IRC, REITs may be subject to certain federal income and excise taxes on undistributed taxable income.
We paid quarterly cash dividends of $1.01 and $0.96 per common share in each of the first two quarters of 2025 and 2024, respectively. Our future common stock dividends, if and as declared, may vary and will be determined by the Board based upon the circumstances prevailing at the time, including our financial condition, operating results and REIT distribution requirements, and may be adjusted at the discretion of the Board during the year.
We make distributions on the common limited partnership units outstanding at the same per unit amount as our common stock dividend. The Class A common limited partnerships units ("Class A Units") in the OP are entitled to a quarterly distribution equal to $0.64665 per unit so long as the common units receive a quarterly distribution of at least $0.40 per unit. We paid a quarterly cash distribution of $0.64665 per Class A Unit in each of the first two quarters of 2025 and 2024.
At June 30, 2025, our Series Q preferred stock had an annual dividend rate of 8.54% per share and the dividends are payable quarterly in arrears.
Pursuant to the terms of our preferred stock, we are restricted from declaring or paying any dividend with respect to our common stock unless and until all cumulative dividends with respect to the preferred stock have been paid and sufficient funds have been set aside for dividends that have been declared for the relevant dividend period with respect to the preferred stock.
Other Commitments
On an ongoing basis, we are engaged in various stages of negotiations for the acquisition or disposition of individual properties or portfolios of properties.
FUNDS FROM OPERATIONS ATTRIBUTABLE TO COMMON STOCKHOLDERS/UNITHOLDERS (“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.
48
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 NAREIT’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 Core FFO 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 attributable to common stockholders/unitholders (“FFO, as modified by Prologis”)
To arrive at FFO, as modified by Prologis, we adjust the NAREIT defined FFO measure to exclude:
Core FFO attributable to common stockholders/unitholders (“Core FFO”)
To arrive at Core FFO, we adjust FFO, as modified by Prologis, to exclude the following:
Limitations on the use of our FFO measures
While we believe our modified FFO measures are important supplemental measures for our stockholders, potential investors and financial analysts to understand, we do not use NAREIT's nor our measures of FFO as alternatives to net earnings computed under GAAP, as indicators of our operating performance, as alternatives to cash from operating activities computed under GAAP or as indicators of our ability to fund our cash needs. These measures 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 to our net earnings computed under GAAP for the six months ended June 30 as follows (in millions):
Reconciliation of net earnings attributable to common stockholders to FFO measures:
1,161
1,444
Add (deduct) NAREIT defined adjustments:
Real estate related depreciation and amortization
1,271
1,240
Gains on other dispositions of investments in real estate, net of taxes (excluding development properties and land)
(83
(216
Adjustments related to noncontrolling interests
(26
Our proportionate share of adjustments related to unconsolidated entities
285
221
NAREIT defined FFO attributable to common stockholders/unitholders
2,598
2,663
Add (deduct) our modified adjustments:
Unrealized foreign currency, derivative and other losses (gains), net
(2
(5
FFO, as modified by Prologis attributable to common stockholders/unitholders
2,791
2,631
Adjustments to arrive at Core FFO:
(128
Current income tax expense (benefit) on dispositions
(4
Core FFO attributable to common stockholders/unitholders
2,752
2,504
ITEM 3. Quantitative and Qualitative Disclosures About Market Risk
We are exposed to the impact of foreign exchange-related variability and earnings volatility on our foreign investments and interest rate changes. See our risk factors in Part 1, Item 1A. Risk Factors in our Annual Report on Form 10-K for the year ended December 31, 2024. See also Note 9 in the Consolidated Financial Statements in Item 1 for more information about our foreign operations and derivative financial instruments.
We monitor our market risk exposures using a sensitivity analysis. Our sensitivity analysis estimates the exposure to market risk sensitive instruments assuming a hypothetical 10% adverse change in foreign currency exchange rates or interest rates at June 30, 2025. The results of the sensitivity analysis are summarized in the following sections. The sensitivity analysis is of limited predictive value. As a result, revenues and expenses, as well as our ultimate realized gains or losses with respect to foreign currency exchange rate and interest rate fluctuations will depend on the exposures that arise during a future period, hedging strategies at the time and the prevailing foreign currency exchange rates and interest rates.
Foreign Currency Risk
We are exposed to foreign currency exchange variability related to investments in and earnings from our foreign investments. Foreign currency market risk is the possibility that our results of operations or financial position could be better or worse than planned because of changes in foreign currency exchange rates. We primarily mitigate this risk by borrowing in the currencies where we invest, creating a natural hedge. In addition, we use derivative financial instruments, such as foreign currency contracts designated as net investment hedges, which offset translation adjustments on the net assets of our foreign investments. At June 30, 2025, after consideration of our ability to borrow in the foreign currencies in which we invest and also derivative and nonderivative financial instruments as discussed in Note 9 to the Consolidated Financial Statements, we had minimal net equity denominated in a currency other than the U.S. dollar.
For the six months ended June 30, 2025, $328 million or 7.6% of our total consolidated revenue was denominated in foreign currencies. We enter into foreign currency contracts that we do not designate, such as forwards, to reduce the impact from fluctuations in foreign currency associated with the translation of the future earnings of our international subsidiaries. At June 30, 2025, we had foreign currency contracts denominated principally in British pound sterling, Canadian dollar, euro and Japanese yen, with an aggregate notional amount of $1.6 billion. As we do not designate these foreign currency contracts as hedges, the gain or loss on settlement is included in our earnings and offsets the lower or higher translation of earnings from our investments denominated in currencies other than the U.S. dollar. Although the impact to net earnings is mitigated through higher translated U.S. dollar earnings from these currencies, a weakening of the U.S. dollar against these currencies by 10% could result in a $164 million cash payment on settlement of these contracts.
Interest Rate Risk
We are also exposed to the impact of interest rate changes on future earnings and cash flows. To mitigate that risk, we generally borrow with fixed rate debt and we may use derivative instruments to fix the interest rate on our variable rate debt. At June 30, 2025, $33.6 billion of our debt bore interest at fixed rates and therefore the fair value of these instruments was affected by changes in market interest rates. At June 30, 2025, $1.6 billion of our debt bore interest at variable rates. The following table summarizes the future repayment of debt and scheduled principal payments at June 30, 2025 (dollars in millions):
2027
Fixed rate debt
2,042
2,656
27,120
33,624
30,944
Weighted average interest rate (1)
3.5
3.3
Variable rate debt
468
146
589
1,043
Total variable rate debt
192
471
273
1,609
At June 30, 2025, the weighted average effective interest rate on our variable rate debt was 2.9% which was calculated using an average balance on our credit facilities throughout the year and our other variable rate debt balances at June 30, 2025. Changes in interest rates can cause interest expense to fluctuate on our variable rate debt. On the basis of our sensitivity analysis, a 10% increase in interest rates on our average outstanding variable rate debt balances would result in additional annual interest expense of $4 million for the quarter ended June 30, 2025, which equates to a change in interest rates of 29 basis points on our average outstanding variable rate debt balances and 1 basis point on our average total debt balances.
ITEM 4. Controls and Procedures
Controls and Procedures (Prologis, Inc.)
Prologis, Inc. carried out an evaluation under the supervision and with the participation of management, including the Chief Executive Officer and Chief Financial Officer, of the effectiveness of the disclosure controls and procedures (as defined in Rule 13a-14(c)) under the Securities and Exchange Act of 1934, as amended (the “Exchange Act”), at June 30, 2025. Based on this evaluation, the Chief Executive Officer and the Chief Financial Officer have concluded that the disclosure controls and procedures are effective to ensure that information required to be disclosed by us in reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC rules and forms.
Changes in Internal Control over Financial Reporting
There have not been any changes in Prologis, Inc.’s internal control over financial reporting (as defined in Rule 13a-15(f) under the Exchange Act) that occurred during the quarter ended June 30, 2025 that have materially affected, or are reasonably likely to materially affect, Prologis, Inc.’s internal control over financial reporting.
Controls and Procedures (Prologis, L.P.)
Prologis, L.P. carried out an evaluation under the supervision and with the participation of management, including the Chief Executive Officer and Chief Financial Officer, of the effectiveness of the disclosure controls and procedures (as defined in Rule 13a-14(c)) under the Exchange Act at June 30, 2025. Based on this evaluation, the Chief Executive Officer and the Chief Financial Officer have concluded that the disclosure controls and procedures are effective to ensure that information required to be disclosed by us in reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC rules and forms.
There have not been any changes in Prologis, L.P.’s internal control over financial reporting (as defined in Rule 13a-15(f) under the Exchange Act) that occurred during the quarter ended June 30, 2025 that have materially affected, or are reasonably likely to materially affect, Prologis, L.P.’s internal control over financial reporting.
PART II. OTHER INFORMATION
ITEM 1. Legal Proceedings
Prologis and our unconsolidated entities are party to a variety of legal proceedings arising in the ordinary course of business. With respect to any such matters to which we are currently a party, the ultimate disposition of any such matters will not result in a material adverse effect on our business, financial position or results of operations.
ITEM 1A. Risk Factors
At June 30, 2025, no material changes had occurred in our risk factors as discussed in Item 1A. in our Annual Report on Form 10-K for the year ended December 31, 2024.
ITEM 2. Unregistered Sales of Equity Securities and Use of Proceeds
During the quarterly period ended June 30, 2025, we issued 0.1 million shares of common stock of Prologis, Inc. in connection with the redemption of common units of Prologis, L.P. pursuant to the terms of the limited partnership agreement of Prologis, L.P. These issuances were made in reliance on the exemption from registration requirements of the Securities Act of 1933, as amended, afforded by Section 4(a)(2) thereof.
ITEM 3. Defaults Upon Senior Securities
None.
ITEM 4. Mine Safety Disclosures
Not Applicable.
ITEM 5. Other Information
On June 4, 2025, Cristina Bita, one of our independent directors, adopted a pre-arranged stock trading plan for the sale of up to 2,621 shares of Prologis, Inc. common stock through August 31, 2026. Ms. Bita’s trading plan was entered into during an open insider trading window and is intended to satisfy the affirmative defense of Rule 10b5-1(c) under the Exchange Act and the Company's policies regarding insider transactions. No other Rule 10b5-1 trading arrangements or non-Rule 10b5-1 trading arrangements (as such terms are defined in Item 408 of Regulation S-K under the Exchange Act) were entered into or terminated by our directors or officers (as defined in Rule 16a-1(f) under the Exchange Act) during the quarterly period ended June 30, 2025.
ITEM 6. Exhibits
The exhibits required by this item are set forth on the Exhibit Index attached hereto.
INDEX TO EXHIBITS
Certain of the following documents are filed herewith. Certain other of the following documents that have been previously filed with the Securities and Exchange Commission (“SEC”) and, pursuant to Rule 12b-32, are incorporated herein by reference.
Form of Officers’ Certificate related to the 4.750% Notes due 2031 (incorporated by reference to Exhibit 4.1 to Prologis' Current Report on Form 8-K filed on May 7, 2025).
4.2
Form of 4.750% Notes due 2031 (incorporated by reference to Exhibit 4.2 to Prologis' Current Report on Form 8-K filed on May 7, 2025).
4.3
Form of Officers’ Certificate related to the 5.250% Notes due 2035 (incorporated by reference to Exhibit 4.3 to Prologis' Current Report on Form 8-K filed on May 7, 2025).
Form of 5.250% Notes due 2035 (incorporated by reference to Exhibit 4.4 to Prologis' Current Report on Form 8-K filed on May 7, 2025).
10.1
Amended and Restated Global Senior Credit Agreement dated as of May 22, 2025 among Prologis, L.P., various affiliates of Prologis, L.P., various lenders and agents, and Bank of America, N.A., as Global Administrative Agent (incorporated by reference to Exhibit 10.1 to Prologis' Current Report on Form 8-K filed May 23, 2025).
10.2
Second Amendment dated as of May 22, 2025 among Prologis, L.P., various lenders and agents, and Bank of America, N.A., as Global Administrative Agent to the Amended and Restated Global Senior Credit Agreement (incorporated by reference to Exhibit 10.2 to Prologis' Current Report on Form 8-K filed May 23, 2025).
15.1†
KPMG LLP Awareness Letter of Prologis, Inc.
15.2†
KPMG LLP Awareness Letter of Prologis, L.P.
22.1†
Subsidiary guarantors and issuers of guaranteed securities.
31.1†
Certification of Chief Executive Officer of Prologis, Inc.
31.2†
Certification of Chief Financial Officer of Prologis, Inc.
31.3†
Certification of Chief Executive Officer for Prologis, L.P.
31.4†
Certification of Chief Financial Officer for Prologis, L.P.
32.1†
Certification of Chief Executive Officer and Chief Financial Officer of Prologis, Inc., pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2†
Certification of Chief Executive Officer and Chief Financial Officer for Prologis, L.P., pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101.INS†
Inline XBRL Instance Document – the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL Document.
101.SCH†
Inline XBRL Taxonomy Extension Schema With Embedded Linkbase Documents.
Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101).
†
Filed herewith
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Exchange Act, the registrants have duly caused this report to be signed on their behalf by the undersigned, thereunto duly authorized.
By:
/s/ Timothy D. Arndt
Timothy D. Arndt
Chief Financial Officer
/s/ Lori A. Palazzolo
Lori A. Palazzolo
Managing Director and Chief Accounting Officer
Prologis, Inc., its general partner
Date: July 29, 2025