We’re coming in hot with breaking news this morning: Prologis CEO Hamid Moghadam is retiring.

Moghadam, the highest-paid CEO of an equity REIT in 2023 despite a $1 base salary, co-founded Prologis' predecessor, AMB Property Corp., in 1983, IPO’d it in 1997 and merged it with Prologis in 2011. 

He will step down on Jan. 1, 2026, but will stay on as executive chairman.

Moghadam, a race car aficionado, grew up in Tehran, Iran, and made his way to the U.S. in 1973 to attend MIT. His AMB Property Corp. originally invested in office, retail and industrial. It ditched office in the collapse of the 1980s and then sold off its $1B retail real estate business in 1999 as Moghadam decided e-commerce was where the margins were.

The rest is history. Prologis has become the world’s largest industrial landlord under his guidance. It has $72B of assets under management spanning 1.2B SF across 5,500 buildings in 19 countries.

President Dan Letter, a 20-year company veteran who used to be its global head of capital deployment, will succeed Moghadam and join the board immediately. 

Prologis’ Q4 net income hit $1.3B, doubling YOY as leasing spiked postelection. The firm signed a record 60M SF but saw occupancy dip to 95.6%. Looking ahead, it plans $2.75B in development starts and a major expansion in data centers and solar. 

Though Prologis saw the election as a boon to business, investment bank BMO thought otherwise, downgrading the REIT in December to “underperform,” as it sees risks ahead from President Donald Trump’s tariffs. It also said Prologis shares are expensive relative to the 10-year Treasury.

— Kayla Carmicheal, Catie Dixon, Mark F. Bonner and Jay Rickey

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CRE News Quiz

SIOR Global’s CEO from 2021 to 2024 was just named a regional president at what brokerage firm?

(Answer at the bottom.)

On Our Radar

• Bill Ackman ups his bid for Howard Hughes Holdings with a $900M offer. Ackman’s Pershing Square has proposed acquiring 48% of HHH by purchasing 10 million newly issued shares at $90 each. The offer is $5 a share higher than a January merger bid and would increase Pershing Square’s stake from 37.6%. The proposal is a 46.4% premium over HHH’s Aug. 5 stock price. Ackman would become chairman and CEO. HHH late Tuesday night said it hasn’t engaged in negotiations with Pershing or made any decisions about the offers.

• JBG Smith reports rising losses amid office decline … and Trump. The largest REIT in the D.C. area posted a $60M Q4 loss, with full-year losses hitting $143M as occupancy in its office (78.6%) and multifamily (96.2%) portfolios declined. The REIT, heavily exposed to federal tenants, faces uncertainty from government downsizing. To boost value, it’s selling assets — offloading $374M in properties last year — and prioritizing stock buybacks. Its earnings are expected to keep falling in early 2025 as office struggles persist. 

• U.S. housing starts slide 9.8% as builders brace for high rates and tariffs. New residential construction fell to an annualized pace of 1.37 million, missing expectations after December's surge. Single-family starts declined 8.4%, while multifamily starts dropped 13.5%. Builders, facing potential tariffs on lumber and Chinese goods, are scaling back and offering incentives like mortgage buydowns to offload existing inventory. Unyielding construction labor shortages, exacerbated by ICE crackdowns on unauthorized immigrants, are also an issue. America’s construction industry needs 439,000 new workers in 2025 to keep up with demand.

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Today’s Deep Dive: With Retail Pharmacies Under The Weather, CRE Grapples For The Right Prescription

Tens of thousands of pharmacies have closed in the last 15 years, leaving swaths of vacant real estate.

In today’s tight retail market and considering the prime locations drugstores typically have secured, landlords will probably be able to backfill. 

But good luck getting nearly the same rent.

“Tenants like Skechers and many others that have backfilled spaces are almost never going to pay you as much rent as the drugstores were paying,” said Jason Baker, who leads the tenant representation team at Houston firm Baker Katz. “That creates a real challenge for the owner of the property.”

Read the full story here.

This Morning’s News

OFFICE — DOGE Unveils 100 New Federal Lease 'Cancellations' (Bisnow): The lease terminations total 2.3M SF across the country. A list of ‘cancellations’ was posted on DOGE’s website. It includes the agency, city, square feet and annual contract value of each lease, which totals $78.8M. It also states the cost savings to the government, which DOGE says totals $144.6M. Read more here.

PEOPLE — White House To Cut FHA Workforce By 40% (Bloomberg): The FHA has insured more than 40 million loans over 90 years and serves as the primary resource for a lot of first-time homebuyers and lower-income Americans. Read more here.

HOUSING — Rents On The Rise After 6-Month Decline (Multifamily Dive): The national average rent increased 20 bps in January to 0.8%, ending a six-month streak of declines. Growth was led by single-family rentals and gains in the Northeast and Midwest. Read more here.

RETAIL — KFC Moves HQ Out Of Louisville (BBC): Fast-food giant KFC — formerly Kentucky Fried Chicken — is relocating its corporate HQ from Kentucky to Texas. Yum Brands will have two headquarters for its main brands: KFC and Pizza Hut will be based in Plano, Texas. Taco Bell and Habit Burger & Grill will remain in Irvine, California. Read more here.

ECONOMY — Fed Governors Say No More Rate Cuts Until Inflation Falls (Bisnow): Regional governors at the Fed gave speeches Monday saying slow progress on getting inflation down to their 2% target is forcing the central bank to keep rates where they are. Read more here.

PROPERTY MANAGEMENT — One Of The World's Largest Employers Aims To Make Big Push Into U.S. (Bisnow): Copenhagen-based ISS is intensifying its presence in the U.S. facilities management market. The company has restructured its North American operations to offer comprehensive services — including facilities management, custodial, workplace services, and food services — across three U.S. regions. Read more here.

RETAIL — Kirkland’s Eyes Bed Bath & Beyond Conversions (CoStar): Home décor retailer Kirkland’s is considering converting underperforming locations into Bed Bath & Beyond or Buy Buy Baby stores. Read more here.

PEOPLE — CRE’s DEI Initiatives Remain Intact Despite Political Shifts (CO): While diversity, equity and inclusion programs in other industries have faced cutbacks, commercial real estate leaders say investor expectations and long-term strategies have helped insulate these initiatives from broader political pressures. Read more here.

REITs — Land & Buildings Pushes For Board Shakeup (WSJ and Land & Buildings): Activist shareholder Land & Buildings has launched a proxy battle at National Health Investors, seeking board changes and strategic shifts. The firm has previously pushed for governance changes and asset sales in the healthcare REIT sector. Read more here and here.

EARNINGS — CoStar Forecasts 10% Revenue Growth (Seeking Alpha): CoStar Group projects 9%-10% revenue growth for 2025, driven by increased investment in Homes.com. The company issued 2025 revenue guidance of roughly $3B and said it plans to expand its international footprint. Read more here.

REITs — Plymouth Industrial REIT Names New President (Plymouth): Plymouth Industrial REIT has promoted Anthony Saladino to president. Saladino has been with Plymouth since 2017. Read more here.

HOTELS — IHG Acquires Ruby Hotel Group For $116M (Bisnow): Ruby Group operates 20 hotels across Europe. The brand has 10 more hotels in its pipeline and plans to use its IHG partnership to grow in new markets, such as the U.S. and Asia. Read more here.

DEVELOPMENT — Ultra-Luxury Beverly Hills Resort Secures $300M (Bloomberg): A high-end resort project in Beverly Hills has locked in $300M in funding from VICI. It's the first investment from a new collaboration between VICI, Cain and Eldridge that will focus on experiential real estate. Read more here.

INVESTMENT — Survey Finds Growing Optimism For CRE (TD Bank): A new TD Bank survey of more than 200 CRE professionals shows 76% believe falling commercial real estate property values will drive increased investment this year. Read more here.

HOUSING — False Social Media Posts Link D.C. Home Sales To Firings (WTOP-Washington): Viral claims suggesting a surge of home listings in D.C. due to federal job cuts have been debunked. While government layoffs could have some market impact, real estate experts say there is no evidence of a direct correlation. Read more here.

DEVELOPMENT — Plans Unveiled For National Juneteenth Museum (The Architect’s Newspaper): Architecture firm BIG released updated renderings for the National Juneteenth Museum in Fort Worth. The museum will feature 10K SF of exhibition galleries, a 250-seat theater, flex space for traveling exhibitions, a business incubator, coworking space and a food hall. Read more here.

LIFE SCIENCES — IQHQ Secures 225K SF Lease With Chan Zuckerberg Initiative (IQHQ): Life sciences developer IQHQ has finalized a lease with the Chan Zuckerberg Initiative at Elco Yards, a mixed-use development in Redwood City, California. Read more here.

ESG — Residential Tower Aims For Record-Setting ESG Standards (Bloomberg): The 63-story Brooklyn skyscraper from Alloy Development is designed to meet “passive house” standards. At 725 feet, it would be the world's tallest passive house. Construction is expected to start this summer. Read more here.

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So You’ve Come For An Answer

Cushman & Wakefield.

Robert Thornburgh will be taking over as regional president of the Southwest. He'll be spearheading the growth and partnership efforts in SoCal, Nevada, Phoenix, Colorado, Utah and Idaho. 

Do you think you have a harder CRE news question? Email us. Take your best shot and we may feature you and your question in this space.

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The First Draft is produced by Director of Newsletters Jay Rickey, Managing Editor Catie Dixon, Editor-in-Chief Mark F. Bonner and Deputy Newsletter Editor Kayla Carmicheal, with an assist from AI. We’d love your feedback! Email us at firstdraft@bisnow.com.