Prologis (PLD) Q2 2026: Data Centers Lead $3.0B of First-Half Development Starts
Prologis reported diluted EPS of $1.13 in the second quarter of 2026 against $0.61 a year earlier, but roughly four-fifths of that increase came from asset disposition gains and a foreign-currency swing rather than from collecting rent. The number that actually reframes the company sits in the development disclosure: development starts in the first half totaled $2,966 million of TEI, of which approximately $2.1 billion went to data centers. Underneath the noise, the logistics base did firm up, with Prologis-share same-store property NOI rising 6.4% on a net effective basis and rent on commencing leases resetting 36.9% higher. After two years in which US warehouse vacancy climbed and Prologis throttled back new starts, the company has doubled its development commitments — and pointed most of the new dollars at digital infrastructure rather than distribution centers.
1. Consolidated Balance Sheet
1-1. Principal asset movements
| Item | Dec 31, 2025 ($M) | Jun 30, 2026 ($M) | Change % |
|---|---|---|---|
| Cash and cash equivalents | 1,145.6 | 1,765.0 | +54.1% |
| Investments in real estate properties (gross) | 95,129.4 | 97,013.8 | +2.0% |
| Less accumulated depreciation | (14,729.1) | (15,783.2) | +7.2% |
| Net investments in real estate properties | 80,400.2 | 81,230.6 | +1.0% |
| Investments in/advances to unconsolidated entities | 11,093.9 | 11,467.4 | +3.4% |
| Assets held for sale or contribution | 203.3 | 499.0 | +145.4% |
| Other assets | 5,881.1 | 6,049.9 | +2.9% |
| Total assets | 98,724.3 | 101,011.9 | +2.3% |
Prologis crossed $100 billion in total assets this quarter, and the composition of the increase is more instructive than the headline. Gross real estate rose $1,884.4 million while net real estate rose only $830.4 million: accumulated depreciation grew $1,054.0 million over the half (net of write-offs on assets sold), and reported depreciation and amortization expense for the six months was $1,421.0 million — more than half of gross additions. This is the structural distortion in any REIT balance sheet under US GAAP: buildings are carried at historical cost and depreciated, with no revaluation option, so a portfolio Prologis says can support $35.6 billion of development TEI on a consolidated basis ($40.6 billion owned-and-managed), counting its land, other real estate investments, land options and covered land plays, is carried at a book value that bears little relation to market value.
Two line items moved on transactions rather than operations. Assets held for sale or contribution more than doubled to $499.0 million, which is a forward indicator — these are properties expected to be contributed to co-investment ventures or sold within twelve months, so the disposition gains that dominated this quarter's income statement have a visible pipeline behind them. The cash build to $1,765.0 million reflected strong operating cash generation and net new debt proceeds; Prologis issued $2,155.3 million of senior notes during the half (Note 5), while total balance-sheet debt rose by a net $1,405.0 million after repayments, $716.6 million of assumed acquisition debt and foreign currency translation effects on non-USD borrowings (Note 11).
