Prologis is set to push ahead with its acquisitions strategy in European prime locations as record demand helps to boost profit in the second quarter.
The San Francisco-based company reported net earnings for the three months to the end of June of $609.9m (£510m), up from $598.6m posted a year ago. For the first half, earnings almost doubled to $1.76bn from $964.4m year-on-year.
Revenue rose to $1.10bn from $1.02bn over the quarter and to $2.18bn from $2.05bn over the six-month period.
The growth comes alongside an increase in total operating portfolio to 51.3m sq ft from 49m sq ft recorded at the same time last year.
Rent also grew by 4.7% year-on-year, the strongest quarterly growth on record, as noted by Ben Bannatyne, president of Prologis Europe. He said: “With demand at record highs, we continue to push deeper into the urban core, leveraging our proprietary data to bolster our built-for-the-future approach while securing space for our customers in prime locations such as Bleiswijk, Roosendaal and Amsterdam in the Netherlands and Berlin, Hanover and Duisberg in Germany.”
During the second quarter, Prologis bought 20 buildings with a net rentable area of 4.8m sq ft in urban markets in France, Germany, Italy and the Netherlands. The company also acquired five land plots totalling 2.6m sq ft along strategic logistics corridors in France, Germany, the UK and Sweden.
Turning to disposals, Prologis sold two buildings and one land parcel, comprising 721,892 sq ft and 3.7m sq ft, respectively.
Occupancy levels across the company’s portfolio grew to 97.7% from 96.4%, with customer retention rate raising to 78.6% from 70.8% year-on-year. For the entirety of 2022, Prologis expects its occupancy levels to stand at between 97.3% to 97.8%.
Hamid Moghadam, co-founder and chief executive at Prologis, said: “As conditions normalise, we are still seeing healthy demand that rivals past peak cycles and, informed by our proprietary data insights, we expect strong demand for our properties to continue.”
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