Prologis Q3 Core FFO and Revenue Top Estimates as Leasing Demand Drives 23% Cash Rent Gains

Prologis reported third-quarter core FFO of $1.60 per diluted share, beating the $1.57 consensus estimate and rising from $1.49 a year earlier, while total revenue of $2.39 billion surpassed the $2.18 billion estimate by $180 million. Net income came in at $815.7 million, up 6.9% year over year and ahead of the $789.3 million consensus. Core FFO in dollar terms reached $1.54 billion, an 8.3% increase from the prior-year period.

Operational metrics were broadly strong. Same-store net operating income grew 5.9%, occupancy held at 95.1%, and Prologis signed 60 million square feet of leases in the quarter. Cash rent change on commenced leases was plus 23.4%, reflecting sustained pricing power in the industrial real estate market. Rental revenue rose 7.4% year over year to $2.21 billion, strategic capital revenue grew 9.3% to $164.3 million, and development management and other revenue nearly doubled, up 92.1% to $17.9 million. Development starts totaled $964 million at an estimated weighted average yield of 6.6% and a 16.1% margin. Liquidity stood at approximately $8.8 billion at quarter-end, with debt-to-adjusted EBITDA at 4.5 times.

For full-year 2026, Prologis narrowed its core FFO per share guidance to $6.25 to $6.29, from a prior range of $6.22 to $6.30. It raised its cash same-store NOI growth outlook to 7.00% to 7.50%, up from 6.75% to 7.25%. Average occupancy guidance was narrowed to 95.25% to 95.50%. Full-year net earnings per share guidance was lowered to $4.05 to $4.15 from $4.40 to $4.55, reflecting changes below the operating line rather than a deterioration in core business performance.