Seize the Day like PROLOGIS.

This image is a free use photo by American Public Power Association on Unsplash.

The Roman saying Carpe Diem, which means Seize the Day, could apply to some real estate companies in this age of AI and energy transition. One company in particular is Prologis, the largest industrial real estate investment trust with a market cap of approximately $102.56 billion and a diverse high quality tenant base spanning 19 countries.

In seizing the opportunity in the energy transition market, Prologis has started a subsidiary company called SolarSmart whose business is installing solar panels on their buildings.

How many buildings do you think they have? 5,500 totaling 1.2-billion square feet of space. That is over 27,000 square miles of roof top space potential for solar panels.

For comparison the largest solar farm in the world is in India with 14,000 square miles of land and the largest in the U.S. is in California with 5 square miles.

Prologis has to have the permission of their tenants to put solar panels on their roofs but this does lower the tenant’s electricity bill. They have now reached 500 megawatts of production and intend on doubling that to 1,000 megawatts within the next two years.

This will make Prologis, an industrial landlord, the second largest producer of electricity from solar power in the U.S. For context, our own CPS produces 6,500 megawatts.  Prologis says that in time it can match that energy output.

But there’s more.

They are also moving into battery storage, the missing link between solar and wind generated electricity with huge potential. Solar and wind depend on good weather for their electricity production, so the batteries are essential to store and release the power at the times its needed, which is generally not the time at which it is being produced, like hot evening times in the summer.

Prologis just launched its first battery storage unit, located in DFW area with 10-megawatt capacity. Their will also be one more in DFW and one in Houston.

Since Prologis owns a vast amount of land worldwide, adding battery storage is a natural extension. This electricity will first be for their tenants in their buildings and then they also will be able to sell electricity to the local operators at peak demand periods when the price soars by 50% or more. So, power-as-a -service will make them lots of money.  Oh, and they are also adding EV charging stations.

Prologis has launched a $25B dedicated data center arm with strategic partner Skybox Datacenters. One of their first developments is a $63-million facility in Pflugerville on a 220-acre campus, the size of Microsoft’s super campus in San Antonio.\

So, here is one real estate operator that has seized the energy transition day by going strongly into electricity production and storage and datacenter construction. Another Roman saying is “Fortune favors the bold!”

S. A. Raub

Please send comments to raub@investmentrealty.com