* Cuts 2008 forecast for the second time in a month

* Stock falls more than 20 percent

* Development and property operations revenue lower

(Recasts lead; updates stock activity, adds CEO quote and analyst quote)

NEW YORK, Oct 23 (Reuters) - ProLogis (PLD.N: Quote, Profile, Research), the largest U.S. owner and developer of warehouse and distribution centers, reported a 55 percent fall in quarterly funds from operations and cut its forecast for the second time in less than a month, sending its shares down to a lifetime low.

ProLogis relies on global trade to stimulate demand for its buildings, which act as temporary storage facilities for consumer and industrial goods bound for markets around the world.

But the worldwide credit crisis has caused manufacturers to cut back on costs and put the brakes on plans for renting out these facilities, prompting Denver-based ProLogis to cut its FFO forecast.

For the third quarter, funds from operations -- a performance measure that strips out the effects of depreciation -- fell to $169.3 million, or 63 cents per share, from $376.2 million, or $1.41 per share, a year earlier, which included gains of 36 cents per share from an acquisition, the company said on Thursday.

Analysts' reduced average forecast was 53 cents per share, according to Reuters Estimates.