(Reuters) – Warehouse-focused real estate investment trust (REIT) Prologis raised the lower end of its full-year forecast for core funds from operations (FFO) on Wednesday, banking on better demand and strength from data centers.
Prologis, which focuses on logistics real estate, expects its 2024 core FFO to be between $5.39 and $5.47 per share, the midpoint of which is above analysts’ average estimate of $5.42 per share, according to LSEG data.
The REIT previously expected full-year core FFO of $5.37 to $5.47 per share.
“While customer demand remains subdued, it is improving, and we expect that trend to continue as the construction pipeline shrinks,” Prologis CEO Hamid Moghadam said.
“Opportunities in data centers and energy give us tremendous confidence in future growth.”
Prologis said its rental revenues rose to $1.85 billion in the second quarter from $1.65 billion a year earlier.
Its quarterly core FFO was $1.34 per share, compared with $1.83 per share a year earlier.
Prologis had previously said persistent inflation and high interest rates kept more customers “focused on controlling costs”.
The company’s total revenue fell about 18% to $2.01 billion, above estimates of $1.88 billion.
Prologis operates in 19 countries and counts Amazon, Home Depot, FedEx and UPS as its biggest customers.
(Reporting by Abhinav Parmar in Bengaluru; Editing by Shreya Biswas)
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