- Realty Income entered Poland in Q2 2025, marking its eighth European country, driven by Poland's status as the second fastest-growing GDP in Europe.
- Investments in Poland included distribution centers and industrial assets, such as Eko-Okna, a leading manufacturer, with initial yields around 7.3%.
- The company sees Poland as a strategic growth market due to its large population, GDP growth, and favorable property laws, with plans to build a transaction pipeline in the region.
- The expansion into Poland is part of broader European growth, leveraging lower euro borrowing costs (~120 basis points below U.S. debt costs) and a fragmented, less competitive landscape.
- European investments now represent 17% of annualized base rent, with continued focus on industrial and retail sectors, especially in Ireland and the UK retail parks.
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- Prologis is exploring additional strategies to capitalize on its data center opportunities, including potential new funds or ownership models, beyond current build-to-suit projects.
- The company has secured or advanced 5.2 gigawatts of data center capacity, representing a $15 billion investment, with plans to fully capture this value.
- Management emphasized the significance of integrating real estate, power access, customer relationships, and capital as a foundation for substantial value creation in data centers.
- There is a deliberate and disciplined approach to data center development, with active discussions ongoing with hyperscalers and a large pipeline of customer interest.
- Closed $2.3 billion in financing with a €1 billion raise at 3.5%, maintaining a low cost of debt at 3.2% with over eight years average maturity.
- Core FFO including net promote expense was $1.49 per share, excluding net promotes $1.50, both ahead of forecast.
- Energy business delivered 28 megawatts of solar generation and storage, progressing toward a one-gigawatt goal by year-end.
- Lease mark to market ended at 19%, capturing $75 million of NOI this quarter and $900 million as leases roll.
- Net effective rent change was 49% on a net effective basis and 29% on cash basis, highlighting durable lease mark to market.
- Record leasing quarter with nearly 62 million square feet signed, driving occupancy to 95.3%, up 20 basis points.
- Same-store net effective and cash NOI growth were 3.9% and 5.2%, respectively.
- Agree Realty achieved its largest quarterly investment volume since COVID, deploying over $450 million in Q3 2025.
- The company increased its full-year 2025 investment guidance to a range of $1.5 to $1.65 billion, up over 65% from last year.
- The investment included 110 high-quality retail properties across multiple sectors, with a weighted average cap rate of 7.2%.
- The pipeline for development and developer funding platforms exceeds $100 million, indicating strong future growth potential.
- The company’s disciplined underwriting standards and strategic partnerships with leading retailers underpin this aggressive growth.
- Company highlights a substantial improvement in cost of capital, supported by strong equity valuation appreciation.
- This improvement enables a shift from a measured to a more aggressive growth posture, with increased pipeline and larger deal potential.
- Over $100 million committed to experiential development and redevelopment projects, with plans to accelerate future investment spending.
- Shop occupancy reached a record high of 92.5%, up 270 basis points YoY, with a target to exceed 93% in H2 2025.
- Management highlighted increased pricing power through better lease terms, including exclusives, radius restrictions, and faster store openings, leveraging high occupancy levels.
- Q2 leasing totaled 712,000 sq ft, the most since 2018, with over 1 million sq ft year-to-date.
- Approximately 2/3 of leasing activity involved new tenants, including full-floor deals.
- Leasing momentum has driven lease percentage up 140 basis points YoY to 88.7%, approaching the 89-90% target for year-end.
- Out-of-service portfolio (Minneapolis, Orlando) is performing well, with leasing approaching 60%, expected to stabilize by end of 2026.
- Rental rates for trophy offices and new construction hit record highs, with asking rents at $92/sq ft, up 27% YoY, driven by limited new supply and high construction costs.
- Executed 15 leases totaling 416,000 sq ft in Q2 with 6.4% higher rental rates than prior rates.
- Renewals accounted for two-thirds of leasing activity, securing over $7 million in annualized revenue.
- 1.3 million sq ft of leases expiring through 2026, with 742,000 sq ft ($11.2 million) expected not to renew.
- Leasing pipeline of 2 million sq ft, over 60% related to renewal discussions.
- Positive net absorption likely from multi-tenant properties with existing infrastructure.
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