PLD · Earnings call · 2026Q3T · Full report

Rental Rate / Leasing Spreads

Prologis, Inc. · 2026-10-15 · Importance 43 · Surprise 32 · In source text

Replacement-cost rents were 27% above current market rents, creating room for further rent growth before new construction becomes economically viable. U.S. market rents increased 50 basis points in the quarter, while European market rents rose 70 basis points during the quarter and 275 basis points year over year. Dallas, Houston, Atlanta, Phoenix, Indianapolis and Northern California were on pace for 5% to 6% market rent growth, even with vacancies in the mid-to-high 7% range in some markets. Brazil had the strongest international momentum, and the Netherlands had the best rent dynamics in Europe.

Key facts

• Prologis' lease mark-to-market ended the quarter at 16%, representing approximately $780 million of embedded NOI at spot rents.
• Rent change on rollover was 38% on a net effective basis, adding $85 million of incremental NOI.
• Prologis said some markets are on pace to have market rent growth of 5% to 6% this year, naming Dallas, Houston, Atlanta, Phoenix, Indianapolis and Northern California.
• Rent change on rollover was 23% on a cash basis.
• Prologis reported market rents increased 50 basis points in the U.S. during the quarter.
• Prologis reported Europe market rents increased 70 basis points during the quarter and 275 basis points year-over-year.

Impact estimates