Tim Arndt
Chief Financial Officer at Prologis
Thanks Jill. Good morning, everybody, and thank you for joining our call. The third quarter marked a continuation of themes we've been anticipating for more than a year, namely; growing supply translating to increased market vacancy, continued moderation of demand, and market rent growth that will slow until the low levels of new starts drive reduced availability over-time. We've operated in accordance with these views in both our approach to leasing as well as timing of new development.
What's incremental to our forecast is that continued hawkish posture from central banks and the impact it's had on rates is delaying decision-making and willingness to take expansion space early. The geopolitical backdrop has clearly become more troubling as well, amounting to a lack of clarity that will likely weigh on demand.
In the meantime, and also playing out to our expectations, is that our existing lease mark-to-market will drive durable earnings growth as it did in delivering record rent change this quarter as well as strong earnings and same-store growth.
We remain focused on the fact that we own assets critical to the supply chain with long-term secular drivers that remain intact. Further, the outlook for future supply will continue to face structural barriers, ultimately driving occupancy, rents and values.
In terms of our results, we had an excellent quarter with core FFO excluding Net Promote Income of $1.33 per share. This result includes approximately $0.03 of one-time items related to interest and termination income as well as the timing of expenses, which we can address in Q&A.
Our occupancy ticked up over the quarter to 97.5%, aided by retention of 77%. Net effective rent change was a record 84% at our share with notable contributions from Northern New Jersey at 200%, Toronto at 187% and Southern California at 165%. Same-store growth on a net effective and cash basis was 9.3% and 9.5% respectively, driven predominantly by rent change.
We saw market rents grow roughly 60 basis points during the quarter, the slower pace embedded in our forecast. In combination with the strong build of in-place rents, our lease mark-to-market recalculates to 62% as of September.
We raised approximately $1.4 billion in new financings at an average interest rate of 3.2%, comprised principally of $760 million within our ventures as well as a recast of our Yen credit facility increasing our aggregate line availability. In combination with our cash position, we ended the quarter with a record $6.9 billion of liquidity.
Finally, it's noteworthy that our debt-to-EBITDA has remained very low, and essentially flat all year, hovering in the mid-4 times range, despite our increased financing activity, a demonstration of the tremendous growth in our nominal EBITDA.
Turning to our markets. While rising, vacancy remains historically very low in the U.S., Mexico and Europe. Market vacancy increased approximately 70 basis points during the quarter in the U.S., driven by low absorption as well as recently delivered but unleased completions. Europe experienced similar dynamics with an overall increase in market vacancy of 50 basis points.
At the macro-level, our expectations for the U.S. are for completions to outpace net absorption by a cumulative 150 million to 200 million square feet over the next three quarters. Then, over the subsequent three quarters, we see that trend reversing with demand exceeding supply and recovering the net 75 million to 125 million square feet. That trend may extend further into 2025 as we believe development starts over the next several quarters are likely to remain low. Whatever the precise path, we expect that as vacancy normalizes over the long-term, our portfolio will outperform the market due to both its location and quality as well as the strength of our relationships and operating platform.
In this regard, our portfolio has been largely resilient to moderating demand. Our teams would describe the depth of our leasing pipeline as consistent with the last few quarters. And coming fresh off of one of our Customer Advisory Board sessions, it's clear that our customers have plans to continue to expand their footprint, increasing capacity and resiliency. However, what's also clear is that they are slowing such investments until there is more clarity in the economic environment.
In the U.S., rents increased in most of our markets with the strongest located in the Sunbelt, Mid-Atlantic and Northern California regions. Europe and Mexico were also bright spots for growth in the quarter. Rents across our Southern California sub-markets declined approximately 2%, as it continues to adjust to higher levels of vacancy.
While the markets and outlook are mixed, we remain confident in continued market rent growth in the U.S. and globally over the coming year, albeit at a slower pace, while the pipeline continues to get absorbed. From our appraisals, U.S. values declined approximately 3%, while European values remained stable, in fact having a very modest write-up.
The difference isn't too surprising as the Fed's language around inflation and the economy has had more effect in the U.S. capital markets, driving the ten-year up 100 basis points since our last earnings call compared to the blend [Phonetic] at just 50 basis points. We believe that this is likely another instance as we saw one year ago, where U.S. appraisals at the end-of-the quarter have not had sufficient time to react to the increase in rates, and we are thus pausing on appraisal-based activity in USLF for at least one quarter.
Elsewhere, values in Mexico are up 8.5% while China experienced its first meaningful decline of 6.5%, a write-down on that we don't believe has fully run its course. Our funds experienced their first quarter of net positive inflows with approximately $180 million of new commitments versus new redemption requests of $115 million. Given the other activity in the quarter, the net redemptions have been reduced from their height of $1.6 billion to approximately $700 million or roughly 2% of third-party AUMs.
In terms of our own deployment, development starts ramped up during the quarter, crossing $1 billion, over half of which is related to a data center opportunity in our Central region, a testament to our higher and better use strategy and strategically located land-bank.
Also notable is the acquisition of $118 million of land, including a strategic parcel in Las Vegas, which will build-out an additional 10 million square feet over-time and brings our total build-out of land globally to over $40 billion. We are laser-focused in identifying and executing on value-creation in our core business, our energy business, and their adjacencies. Combined with the debt capacity and liquidity we worked hard to build and preserve, we see the environment as rich with opportunity.
Moving to guidance, we are increasing average occupancy to a range between 97.25% and 97.50%. As a result, we are increasing our same-store guidance to a range of 9% to 9.25% on a net effective basis, and 9.75% to 10% on a cash basis. We're maintaining our strategic capital revenue guidance, excluding promotes to a range of $520 million to $530 million and adjusting G&A guidance to range between $390 million and $395 million.
Our development start guidance is increased to a new range of $3.0 billion to $3.5 billion at our share, driven primarily from the data center start mentioned earlier. We have $500 million of contribution in disposition activity during the quarter. And given our commentary on USLF valuations, we are pausing our planned contributions into that vehicle this quarter, and reducing our combined contribution and disposition guidance to a range of $1.7 billion to $2.3 billion.
In the end, we are adjusting guidance for GAAP earnings to the range of $3.30 to $3.35 per share. We are increasing our core FFO including promotes guidance to a range of $5.58 to $5.60 per share and are increasing core FFO excluding promotes to range between $5.08 to $5.10 per share, growth of nearly 10.5%.
I know that many of you are focusing on 2024, so I'd like to take an opportunity to remind you that the Duke portfolio will be entering the same-store pool in 2024, which will widen the recently observed delta between net effective and cash same-store growth. This is of course because Duke rents were mark-to-market at close one year-ago, so its contribution to net effective same-store growth and earnings will be minimal, even though the cash rent change will be on par with the rest of the Prologis portfolio.
In closing, we are navigating the current environment, assured that whatever the economy brings in the short-term, we are positioned to outperform over the long-term. This stems from not only the premier logistics portfolio and customer franchise with one of the best balance sheets amongst corporates, but also highly visible earnings and portfolio growth ahead of us. We know that turbulent times can bring opportunity for those who are prepared and that's been central to our strategy and management as a company.
Would like to also remind you of our upcoming Investor Forum on December 13th in New York, our first in four years. We're looking-forward to spending the day with you, sharing more about our business, outlook and opportunities ahead. Additional information is available on our website and in our earnings press release.
And with that, I will hand it back to the operator for your questions.
