Hamid Moghadam will retire as CEO of Prologis, a company he co-founded more than 40 years ago, the company announced Wednesday. Moghadam will step down effective Jan. 1, 2026, and will be succeeded by Prologis President Dan Letter, who has been at the company for two decades.

“This transition has been carefully planned to ensure Prologis' continued success,” Moghadam said in a statement. “Having worked closely with Dan for more than 20 years, I have full confidence in his leadership. He embodies our values and is committed to the company's long-term vision. I look forward to supporting him and the leadership team in my new role.”

Moghadam will stay on at Prologis as executive chairman and will continue to provide strategic guidance about the company’s direction.

As part of the succession plans, Letter joined Prologis’ board of directors this week. His most recent role at the company was head of capital deployment, in which he oversaw the firm’s investment committee, development pipeline and portfolio management.

“Hamid started this company more than four decades ago and has taken it to unbelievable heights,” Letter said in a news release. “Given our scale, role in the supply chain and disciplined approach to our balance sheet, our future is very bright. I am excited to continue to work with Hamid and the rest of the management team to grow and strengthen the company.”

An Iranian immigrant who earned degrees from the Massachusetts Institute of Technology and Stanford University, Moghadam co-founded AMB Property Corp. in 1983. He brought the company public in 1997 and led a merger with ProLogis in 2011.

The developer with a penchant for race car driving developed a reputation as a maverick willing to make big bets as far back as the late 1990s.

By 2023, Moghadam was the highest-paid CEO in the U.S. equity REIT sector, earning a combined $51M, including $49M in stock awards. Steven Roth at Vornado Realty Trust was a distant second, earning $27M.

Prologis was one of the industry’s biggest winners from the pandemic as demand for distribution space exploded. The San Francisco-based company more than doubled its net earnings in the fourth quarter compared to the previous year, boosted by a postelection bump in activity.

Prologis viewed the reelection of President Donald Trump as good for business, but investment bank BMO disagreed, downgrading the REIT to “underperform,” predicting risks from Trump’s tariffs.

The company also launched a dedicated data center arm last year, bringing in Compass Datacenters co-founder Chris Curtis to lead a planned $7B to $8B in investment in the space through 2029.

UPDATE, FEB. 19, 12:06 P.M. ET: This story has been updated with additional context and a statement from Dan Letter.