Season 7, Post 38: Build baby, build
President Trump’s famous axiom about drilling was reframed and rephrased with regularity at the annual thought leadership event hosted last week by Prologis. Your author, who stayed up late to participate virtually in this invite-only event broadcast from Los Angeles, heard how the US needs more energy infrastructure – and quickly.
Prologis, the largest industrial real estate business in the world, has hosted a forum annually since 2021 (see prior posts here, here, here and here). As with each event, the purpose is to bring together panels of luminaries to discuss topical issues – call them future trends – and to demonstrate how Prologis is positioning to benefit from them. The 2025 programme included senior members of the Trump administration, chief executives of S&P 500 Index businesses, leading academics, decorated ex-military members and start-up founders.
We have written about power shortages since 2011 and most recently in 2022. The subsequent AI infrastructure boom has only exacerbated these challenges. Hamid Moghadam, the co-founder and Chief Executive of Prologis, highlighted how customers not only want “abundant and reliable energy” but don’t want it to be a “constraint on their business.” Against this background, Doug Burgum, the US Secretary of the Interior (who joined Hamid in the opening keynote), reiterated that the US Government is seeking to “help the world move more quickly…[by] unleashing more energy.”
Forget the energy transition and think more about how to prioritise energy addition (in the words of Secretary Burgum). In practical terms, this means accelerating and improving permitting mechanisms for new builds, thinking more intelligently about locating new infrastructure close to power sources and embracing all forms of energy inputs. We have long argued that countries prosper best with diversified energy portfolios. A strong case was made for increased use of natural gas small modular nuclear reactors and geothermal energy. We are geothermal fans too and see this energy source as ideal for baseload power. Like natural gas, it also has the advantage of being domestically abundant in the US.
Given Prologis’ ownership of 800m square feet of warehouses in the US (and 1.3bn globally), more rooftop solar also makes sense. Additionally, some of its existing warehouses have the potential to be repurposed as data centres. Their often-strategic locations, close to demand hubs, are an added benefit. For Prologis, it is about “listening to their customers and serving their needs.” For the world more broadly, it’s about satisfying our growing hunger for power– both to keep the lights on and in the ongoing battle for AI dominance.
8 October 2025
The above does not constitute investment advice and is the sole opinion of the author at the time of publication. Heptagon Capital is an investor in Prologis. The author of this piece has no personal direct investment in the business. Past performance is no guide to future performance and the value of investments and income from them can fall as well as rise.
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Alex Gunz, Fund Manager
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