Why I Just Bought More of This Under-the-Radar AI Play
Prologis (NYSE: PLD) is the largest publicly traded real estate investment trust (REIT). It operates 1.2 billion square feet of warehouse space across several global markets. It's one of the biggest players in global trade (2.8% of global GDP flows through its distribution centers each year).
The leading industrial REIT's dominance in logistics is one of the top reasons I own the stock. However, it recently began leveraging its massive land position and energy expertise to tap into an enormous emerging growth opportunity: data centers. These facilities are crucial to supporting digital transformation initiatives and new technologies like AI. That AI-powered upside is one of the reasons I just bought more of this leading REIT.
Prologis is a leader in logistics real estate. It owns over 5,500 warehouses across North and South America, Europe, and Asia. The company has about 6,700 customers that lease space in its facilities under long-term contracts. Those leases supply the company with predictable and growing cash flow. The REIT expects the net operating income (NOI) from that existing portfolio to grow at a 7.5% to 8.5% annual rate over the next few years, driven primarily by rent growth (from escalators in its long-term leases and capturing higher market rents as legacy contracts expire).
Source Fool.com
