This 3.1%-Yielding Dividend Stock is Coming Off a Record 2025, With Robust Momentum for 2026

Prologis (NYSE: PLD) often stands out for its ability to pay dividends. The leading real estate investment trust (REIT) currently offers a 3.1% yield, nearly three above the S&P 500's level. The company has grown its payout at a 13% compound annual rate over the last five years, more than twice as fast as the S&P 500 (5%) and other REITs (6%).

Growth is a big part of the industrial REIT's story. It's coming off a record 2025, which gives it plenty of momentum for the year ahead. That puts it in an excellent position to continue growing its dividend and producing attractive total returns for shareholders.

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One for the record books

Prologis generated $5.86 per share of core funds from operations (FFO) in 2025, after excluding net promote income (its share of the excess profits from the investment funds it manages). That was 6% higher than 2025's level. The company benefited from strong growth in its existing portfolio, driven by contractual rental increases and securing new leases at higher rates as legacy agreements expired. It also benefited from its heavy investment to expand its portfolio through development projects and acquisitions. Prologis stabilized nearly $2.3 billion of development projects last year and completed $1.7 billion of acquisitions.

Demand for space in its properties was robust. Prologis signed a record 228 million square feet of leases last year. That will keep occupancy levels high in 2026, while driving additional growth from rental increases and development completions.

The momentum continues in 2026

Prologis expects its core FFO excluding net promote income to rise to a range of $6.05 to $6.25 per share in 2026, roughly 3% to 7% higher than 2025's total. The company anticipates that its existing portfolio will deliver 4.3% to 5.2% net operating income growth this year. Additionally, Prologis expects to stabilize between $2.3 billion and $2.8 billion in development projects and to make $1 billion to $1.5 billion in acquisitions.

The REIT plans to start $3 billion to $4 billion of new development projects this year. In addition to warehouses, Prologis continues to use some of its vast land bank to build data centers. It has expanded its data center power pipeline to 5.7 gigawatts (GW) of capacity. The company also continues to invest in installing solar and battery storage at its facilities, with it surpassing 1 GW of installed capacity last year. Prologis' global platform, built around logistics, digital infrastructure, and energy, puts it in a strong position to grow shareholder value in the coming years.

A top-tier dividend growth stock

Prologis is capitalizing on record demand for logistics and data center space by securing new leases that support high occupancy levels across its existing portfolio and new development projects. It expects to continue growing its earnings at a solid rate in 2026, which should drive further dividend growth. That makes it a great dividend growth stock to buy and hold for the long haul.

Matt DiLallo has positions in Prologis. The Motley Fool has positions in and recommends Prologis. The Motley Fool has a disclosure policy.