Prologis, the world's biggest warehouse owner and developer, is spending billions to morph into a data center and energy systems giant.
The San Francisco-based real estate investment trust plans to spend $8 billion over the next four years to build 20 data centers, eventually expanding that number to as many as 100 projects in a bid to extend its dominance in industrial real estate to the properties and digital networks powering artificial intelligence.
To do so, the firm and others seeking a foothold in the AI race will need to tap "energy from all sources," including nuclear reactors, natural gas, solar and other renewable sources to power the data centers and industrial networks of the future, Prologis CEO Hamid Moghadam said at the company's annual Groundbreakers supply chain conference.
This year's event largely focused on data center growth. According to research firm Statista, the U.S. had as many as 5,400 data centers in early 2025, more than double the number from five years ago, due to rising demand for artificial intelligence and cloud services. The CEO of Nvidia, a maker of chips used in AI data centers, expects global spending on these properties to hit $4 trillion by the decade's end.
To address the grid-draining energy needs resulting from the proliferation of data centers, Prologis is using rooftops across its network of 1.3 billion square feet of warehouses globally to capture solar energy. Those projects include plans unveiled this year to add 45 rooftop solar energy projects atop its northern Illinois warehouses. It has also entered into partnerships with solar and utility companies such as SolarEdge and Southern California Gas to create renewable power and boost electrical grid resilience.
Prologis has become a major buyer of power, with data centers totaling some 3.4 gigawatts of electrical capacity either in operation or advanced development stages worldwide. As the world’s largest landlord to tech companies such as Amazon, Prologis has a key vantage point to expand into data centers and the energy sources that power them, Moghadam said.
“When you look at the numbers, real estate costs are about 3% to 4% of total supply chain costs for our customers, but all of our customers use energy,” he said. “Our business is now more of an infrastructure business beyond real estate. That physical infrastructure has transformed into a digital business, which is data centers.”
Powering the data center push
Power availability is proving to be just one threat to the exponential growth of the data center industry. As Prologis — and other developers like Panattoni and Equinix — expand their data center investments, they are finding other challenges in the form of water constraints and high construction costs.
“We’re spending a lot of time and money on data centers and they have a voracious appetite for energy — way beyond what renewable sources alone can produce,” Moghadam said. “The answer for our energy and infrastructure business is very simple: energy from all sources and then some."
During the event, U.S. Interior Secretary Doug Burgum said the U.S. needs an uninterrupted supply of affordable energy because “national security is energy security.”
“We’ve got to increase the supply of all forms of energy,” Burgum said. “To win the AI arms race against China, we’ve got to figure out how to build these artificial intelligence factories close to where the power is produced, and just skip the years of trying to get permitting for pipelines and transmission lines.”
In a recent show of Prologis' data center push, the company in May acquired an 832-acre site outside Atlanta for a massive campus under the code name Project Sail.
Prologis owns over 6,000 buildings in 20 countries. Many of the company's buildings near large cities are candidates for conversion to “higher and better use” as data centers and energy facilities, Prologis Chief Financial Officer Tim Arndt told analysts at the BofA Securities 2025 Global Real Estate Conference last month.
“A lot of our logistics buildings look and feel, at least in their shell and format, like a data center,” Arndt said. “The fact that we have 6,000 buildings on 15,000 acres is a rich palette to draw from for value creation.”
AI use drives renewed interest in nuclear energy
Energy company executives at the conference said the country will need to support all forms of energy generation to meet future demand.
"We absolutely need nuclear energy — not just the existing plants that we have today, but also in order to meet some of the baseload challenges that we have in the future," said former NextEra Energy Resources CEO Rebecca Kujawa in a panel discussion.
Nuclear energy holds the most promise for generating the vast power needs of tech companies, including Microsoft, Google and Amazon, that are spending billions to open massive hyperscale data centers across the globe, said Kujawa.
Amazon has already launched partnerships with several energy companies to power its Amazon Web Services cloud computing data centers.
The e-commerce giant signed a deal last year with Dominion Energy, a utility that's exploring a small modular reactor near the utility's North Anna nuclear power station in Louisa County, Virginia. In June, Amazon expanded its partnership with Houston-based Talen Energy to receive energy from the Susquehanna nuclear power plant.
"The data economy customers that we're dealing with want to run their systems 24-7," Joseph Dominguez, CEO of Baltimore, Maryland-based Constellation Energy, said during the Groundbreakers event. "They'd like the ability to have firm pricing so that they know the price for energy for 20 years."
The permitting reform advocated by U.S. Interior Secretary Burgum — along with partnerships between government and business — will be necessary to build nuclear power facilities on a scale that is needed to drive AI data centers and other facilities, according to Dominguez.