Prologis Inc (NYSE:PLD) stock rose 2.14% (As on April 17, 11:26:35 AM UTC-4, Source: Google Finance) after the company posted better than expected results for the first quarter of FY25. In the near term, policy uncertainty is making customers more cautious. But over the long term, limited new supply and high construction costs support continued rent growth. In the quarter, 65.1 million square feet of leases commenced in the company’s owned and managed portfolio. The retention level was 72.9% in the quarter. The average occupancy level in Prologis’ owned and managed portfolio was 94.9% in the first quarter, down from 95.6% in the prior quarter and 96.8% in the year-ago period. Prologis’ share of net effective rent change was 53.7% in the January-March quarter. In the reported quarter, the cash rent change was 32.1%. Cash same-store net operating income (NOI) grew 6.2% compared to 6.7% in the previous quarter.

Further, the company’s share of building acquisitions amounted to $811 million, with a weighted average stabilized cap rate (excluding other real estate) of 4.2% in the first quarter. Development stabilization aggregated $925 million, with 64.5% being built to suit, while development starts totaled $646 million, with 78% being built to suit. PLD’s total dispositions and contributions were $188 million, with a weighted average stabilized cap rate (excluding land and other real estate) of 4.0%. Prologis exited the first quarter of 2025 with cash and cash equivalents of $671.1 million, down from $1.32 billion at the end of the fourth quarter of 2024. Total liquidity amounted to $6.52 billion at the end of the quarter. Debt, as a percentage of the total market capitalization, was 25.7% as of March 31, 2024.

PLD in the first quarter of FY25 has reported the adjusted funds from operations (FFO) per share of $1.42, beating the analysts’ estimates for the adjusted FFO per share of $1.38, according to the Zacks Consensus Estimate. The company had reported the adjusted rental revenue of $1.99 billion in the first quarter of FY25, beating the analysts’ estimates for rental revenue of $1.94 billion.  Total revenues were $2.14 billion, up from the year-ago quarter’s $1.96 billion.

Prologis reaffirmed its 2025 core FFO per share guidance in the range of $5.65-$5.81. The Zacks Consensus Estimate for the same is currently pegged at $5.71. The company expects average occupancy to be between 94.5% and 95.5%. Cash same-store NOI (Prologis share) is projected in the range of 4-5%.

The company has lowered its outlook for capital deployment (Prologis share) on development starts to $1.50-$2.00 billion, from the prior range of $2.25-$2.75 billion.