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Prologis Embarks on $8 Billion Data Center Expansion, Prioritizing Energy Solutions


Data center

Prologis, the top-valued U.S. real estate investment trust (REIT), is set to invest between $7 billion and $8 billion over the next five years to develop its data center business. This strategic move marks a significant expansion beyond its traditional industrial real estate portfolio, which spans 1.2 billion square feet across 19 countries. The company's focus is on the critical role of energy procurement, production, and storage in the data center sector.


Chris Curtis, the newly appointed global head of Prologis' data center division, emphasized that while the company will not operate as a utility, a central part of its strategy involves securing substantial power resources. Prologis has already obtained commitments for 1.3 gigawatts of power and is negotiating for an additional 1.5 GW. This approach highlights the importance of a reliable power supply in maintaining data center operations, especially as energy demands are projected to rise with the growth of artificial intelligence and digital infrastructure.


Prologis plans to utilize its extensive land holdings, totaling 12,000 acres globally, to support its data center developments. The company will focus on build-to-suit projects, particularly in key markets such as Northern Virginia, Silicon Valley, and Chicago, which are known for their high demand for data center space. This strategy also includes the potential conversion of existing industrial properties into data centers, leveraging Prologis' established infrastructure and market presence.


Committed to sustainability, Prologis aims to expand its Prologis Essentials program, which focuses on renewable energy solutions. The company is increasing its solar power capacity and integrating energy storage systems to support its goal of achieving net-zero emissions by 2040. This includes initiatives like rooftop solar installations and partnerships with utilities to enhance grid stability.


Prologis' entry into the data center market comes at a time of increasing digital transformation across industries. The company's extensive experience in industrial real estate and strong relationships with major technology companies position it well to capitalize on the growing demand for data centers. With this ambitious expansion, Prologis seeks to establish itself as a key player in the data center sector, leveraging its expertise and resources to meet the evolving needs of the digital economy.

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