Daniel Letter
About Daniel Letter
Daniel S. Letter, 48, is President of Prologis and became a director in February 2025; he will succeed Hamid Moghadam as CEO on January 1, 2026. He oversees global real estate operations, capital deployment, Strategic Capital and Essentials, and holds a B.S. in civil engineering from Marquette University; he also serves on Nareit’s advisory board of governors . Company performance context during his leadership: in 2024, Prologis delivered 21.9% net EPS growth and 8.4% Core FFO per share growth, and over 10 years achieved 12.6% TSR CAGR with outperformance versus large-cap REITs .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Prologis | President | Jan 2023–present | Responsible for majority of business lines; CEO-designate for 2026 . |
| Prologis | Global Head of Capital Deployment | Jan 2021–Jan 2023 | Led Investment Committee, deployment pipeline, multimarket portfolio M&A . |
| Prologis | President, Central Region | Jan 2019–Jan 2021 | Regional leadership driving operations and growth . |
| Prologis | Managing Director – Capital Deployment, West Region | Apr 2017–Jan 2019 | Pipeline management, acquisitions/dispositions . |
| Prologis | Various leadership roles | 2004–2017 | Key contributor to Prologis’ growth; >20 years tenure . |
External Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Nareit | Advisory Board of Governors Member | N/A | Industry engagement; governance and strategy perspective . |
| Public Company Boards | None | — | No other public directorships . |
Fixed Compensation
| Metric | 2023 | 2024 |
|---|---|---|
| Salary ($) | $687,693 | $696,154 |
| Target Bonus ($) | — | $910,000 |
| Bonus Paid ($) | $994,500 | $768,900 |
| % of Target (Bonus) | — | 84.5% |
| Bonus Exchange Election | 100% exchanged | 100% exchanged |
| Exchanged Equity (Units/Shares) | 7,651 LTIP Units | 7,023 LTIP Units |
Performance Compensation
Annual Bonus – Scorecard Outcomes (2024)
| Metric | Weighting | Target | Actual | Payout |
|---|---|---|---|---|
| Corporate Score | 80% corporate / 20% individual | 100% | 84.5% | 84.5% of target |
| Core FFO per Share ($) | — | $5.55 | $5.53 | Below target; contributed to reduced payouts |
| Same Store NOI YoY (%) | — | — | 5.4% | Below target; overall corporate score 84.5% |
Notes: 2024 was the first year since the 2011 merger that Prologis did not achieve its target corporate score; Committee assigned individual scores at 84.5% for NEOs, including Letter .
Long-Term Incentive (LTI) Equity – Forward-Looking PSUs (2024–2026)
| Item | Detail |
|---|---|
| Grant Date | January 16, 2024 |
| Award Type | PSUs (forward-looking, relative TSR vs MSCI REIT Index) |
| Shares Granted | 39,492 PSUs |
| Grant Date Fair Value | $5,098,417 (valued at $129.10 using Monte Carlo with 10% illiquidity discount) |
| Payout Scale | Threshold 50% of target; Maximum 200%; linear interpolation between 35th and 85th percentiles |
| Settlement & Vesting | Settled in equity at end of performance period (subject to TSR), with subsequent vesting and lock-up periods |
Additional Equity Awards
| Grant | Type | Units | Grant Date Fair Value |
|---|---|---|---|
| Jan 16, 2024 | LTIP Units (backward-looking program) | 33,661 | $4,374,920 |
| Feb 21, 2024 | Equity award (plan-based) | 6,869 | $916,462 |
| Sep 13, 2024 | Equity award (plan-based) | 3,212 | $417,496 |
| 2025 service-based award | Service-based equity (first tranche under new program) | — | $1,329,120 |
Equity Ownership & Alignment
| Ownership Measure | Value |
|---|---|
| Common Stock Owned (as of Mar 12, 2025) | 20 shares |
| Shares Acquirable within 60 Days | 131,001 |
| Total Beneficial Ownership | 131,021 |
| Ownership as % of Shares Outstanding | <0.1% (denoted “*”) |
| Stock Ownership Guidelines | 3x base salary for other NEOs; directors 5x annual cash retainer; all NEOs/directors in compliance |
| Hedging/Pledging | Prohibited by policy; all directors and executive officers compliant |
Outstanding Awards and Vesting Triggers (Selected)
- 1,244 LTIP Units: vested 50% on Jan 17, 2025; remaining 50% vest on Jan 17, 2026 .
- 4,920 LTIP Units: vested 50% on Feb 25, 2025; remaining 50% vest on Feb 25, 2026 .
- 312 LTIP Units: will vest on Dec 29, 2025 .
- Plus multiple unearned/equity incentive plan awards outstanding (e.g., 39,492 PSUs) subject to performance/vesting per plan .
Employment Terms
| Scenario | Cash Severance (Salary+Bonus) | Health & Welfare Benefits | 280G Adjustment | Equity Awards (Accelerated) | Total Estimated Value |
|---|---|---|---|---|---|
| Death | $610,000 | — | — | $21,741,539 | $22,351,539 |
| Disability | — | — | — | $21,741,539 | $21,741,539 |
| After Change in Control: Termination without Cause or Voluntary Termination for Good Reason | $3,220,000 | $116,335 | — | $21,741,539 | $25,077,874 |
Additional terms and governance:
- Change-in-control benefits structured on a double-trigger basis; strong compensation governance framework (no excise tax gross-ups; longer-than-market vesting) .
- Incentive Compensation Recovery Policy (clawback) compliant with SEC Rule 10D-1/NYSE listing standards; recovery of incentive compensation erroneously received over prior 3 fiscal years; covers stock price and TSR .
- Deferred compensation: Mr. Letter did not defer salary/bonus under NQDC; 401(k) elective deferrals were $23,000 in 2024 and $22,500 in 2023 .
- All other compensation: $24,000 in 2024 .
Board Governance
- Board Service: Director since February 2025; Board committees: None; other public directorships: None .
- Independence: Board determined all nominees except Mr. Moghadam and Mr. Letter are independent; thus, Mr. Letter is not independent .
- Oversight: Audit, Governance, and Compensation Committees are 100% independent; lead independent director structure and executive sessions at every Board meeting provide independent oversight .
- Attendance: In 2024, all directors attended at least 75% of Board and applicable committee meetings; directors are in compliance with stock ownership guidelines; hedging/pledging prohibited .
Performance & Track Record
- Operations and Strategy: Under leadership from Moghadam and Letter, Prologis advanced succession planning; expanded Mexico footprint via FIBRA Prologis’ acquisition of a majority interest in Terrafina; hosted GROUNDBREAKERS forum for thought leadership .
- Financial/Operational Metrics (2024): Core FFO per share of $5.53 (8.4% YoY growth) slightly below target $5.55; Same Store NOI up 5.4%; occupancy outperformed market by ~260 bps; Essentials contribution beat target; Development Stabilizations $3.91B with 22.1% margins above stretch goal .
- Capital Markets/Credit: Moody’s upgraded rating to A2 in March 2025; S&P “A”; 2024 debt transactions >$11B with 4.4% rate and 9.1-year term (CFO-led) .
Compensation Structure Analysis
- Pay Mix: Significant equity-based compensation via PSUs and LTIP Units; 2024 bonus below target (84.5%) and fully exchanged for equity, strengthening alignment; grant-date fair value of 2024 PSUs $5.10M; backward-looking LTIP Units $4.37M; additional plan-based awards in 2024 and service-based award in 2025 under new LTI program .
- Program Changes: Adoption of forward-looking LTI PSUs (single TSR-based plan) and reduction of PPP award pool from 40% to 25% starting with 2024 Promotes; simplification favored by stockholders (92% Say-on-Pay support in 2024) .
- Governance Safeguards: No hedging/pledging; clawback policy per SEC/NYSE; double-trigger CIC; independent consultant (Pay Governance) engaged by Compensation Committee, independence affirmed .
Equity Ownership & Alignment Details
- Beneficial ownership is modest (<0.1% of outstanding) but with substantial outstanding performance and time-based awards that vest through 2025–2026, reinforcing retention and multi-year alignment .
- Compliance with stock ownership guidelines (3x salary for NEOs); required retention of 50% of net shares until thresholds are met; hedging/pledging prohibited (reduces misalignment risk) .
Employment Terms – Additional Notes
- CIC definitions include double-trigger protections and Good Reason (e.g., material diminution of duties, compensation reduction, relocation >50 miles); Cause defined by willful failure, injurious conduct, or egregious misconduct .
- Tax and accounting treatment: Company intends compensation to comply with 409A; equity awards expensed per ASC 718; REIT tax status limits impact of 162(m) deductibility constraints .
Say-on-Pay & Shareholder Feedback
- 2024 Say-on-Pay approval: 92%; broad outreach to 67% of top 100 stockholders (52% of total shares); resulted in program changes (CEO pay cap, forward-looking LTI, PPP pool reduction, lower meeting thresholds) .
Compensation Committee Analysis
- Committee membership: George L. Fotiades (Chair), David P. O’Connor, Olivier Piani; all independent; Pay Governance engaged as independent advisor; committee oversees clawback and succession planning .
Investment Implications
- Alignment: Letter’s full bonus exchange into equity and large forward-looking PSU grant tie outcomes to relative TSR; prohibition on hedging/pledging and ownership guidelines support alignment, while modest current share ownership mitigates outsized insider influence .
- Retention and Overhang: Multiple vesting events in 2025–2026 (e.g., Jan/Feb 2026 LTIP tranches) and the 2024–2026 PSU performance period create retention hooks; monitor post-vesting selling given policy constraints, but potential liquidity events around vesting dates may affect insider supply .
- Governance Strength: Double-trigger CIC, robust clawback, independent committee/advisor, and strong say-on-pay support reduce governance risk; program simplification and PPP pool reduction may temper future equity overhang variability .
- Execution Risk/Upside: Track Letter’s transition to CEO in 2026, continued Strategic Capital growth, Essentials performance, and data center initiatives; bonus metrics (Core FFO, NOI, development margins) provide near-term performance levers relevant to payout trajectories .