Goodman

Goodman Group Securityholder Review 2013

Strength in numbers

Propertydevelopment

91%

of new development commitments pre-sold and pre-funded

Goodman’s development activities continued to grow strongly and with our specialist capability, infrastructure and people in place, we have been well positioned to capitalise on the opportunities generated by high levels of customer and investor demand for Goodman’s development product across all of our operating markets. The undersupply of prime quality industrial space and the structural changes taking place globally are key growth drivers of our development business. They have enabled Goodman to enhance its overall market position during the year and remain one of the largest developers of industrial property in the world. We finished the year having secured $2.2 billion of new development commitments across 69 projects in 11 countries, with a forecast yield on cost of 8.7%. An overall leasing pre-commitment of 72% was achieved, with an average lease term of 6.8 years. A high 91% of these new development commitments are either pre-sold to, or pre-funded by, Goodman’s managed funds or third parties, demonstrating our ongoing focus on maintaining a low risk development approach.

View time lapse video of the construction of Goodman’s Reedy Creek Unit Estate in Sydney, Australia

Commenced developments include:

  • a 133,997 sqm logistics centre in Mönchengladbach, Germany for e-retailer, Zalando, which is being constructed in two phases;
  • also in Germany, a 95,545 sqm built-to-suit facility in Leipzig for third party logistics provider, DB Schenker, on behalf of its customer, BMW;
  • a 51,355 sqm multi-customer logistics and distribution facility in Nagoya, Japan;
  • in Tianjin, China, a 101,748 sqm built-to-suit warehouse and distribution centre for leading e-retailer, Vipshop;
  • also in Western Sydney, a 43,150 sqm distribution centre for retail hardware chain,
    Bunnings; and
  • in the United Kingdom, a 10,223 sqm warehouse development for Kent County Council.

The strong global demand for prime quality industrial space has driven the growth of Goodman’s development work in progress to $2.3 billion, compared with $1.9 billion for the same period last year. This reflects the benefits of our globally diversified platform, with developments underway across all
of our regions, including our recently entered markets of North and South America. The 69 projects we are currently undertaking around the world equate to 1.9 million sqm of new logistics and business space, with 92% being undertaken on behalf of our managed funds or third parties and 72%
currently pre-committed.

Work in progress as at 30 June 2013

  • North America 2%
  • UK 3%
  • Brazil 3%
  • New Zealand 6%
  • Greater China 13%
  • Japan 16%
  • Continental Europe 24%
  • Australia 33%
We have maintained our development pipeline at in excess of $10 billion, capable of delivering a forecast gross lettable area of over 7 million sqm.

Goodman delivered almost 1.2 million sqm of new space across 66 projects globally during the year. Developments completed during the 2013 financial year include:

  • two facilities of 112,597 sqm each at Pforzheim and Koblenz in Germany on behalf of Amazon;
  • a 62,494 sqm turnkey facility in Belgium for global provider of hand tools, power tools and related accessories, Stanley Black & Decker;
  • in Brisbane, a 51,725 sqm warehouse and office facility for discount retailer, Kmart;
  • phase one of Goodman Pudong International Airport Logistics Centre in China, comprising 43,038 sqm of gross lettable area, with customers including leading international logistics provider, Kuehne + Nagel, and luxury goods group, Richemont;
  • a 28,589 sqm warehouse redevelopment in Sydney for third party logistics provider, DHL Global Forwarding;
  • in Poland, a 28,117 sqm distribution and processing centre for discount fashion retailer, TJX Europe;
  • a 21,524 sqm distribution hub in the United Kingdom for PCL Logistics on behalf of their customer, milk and dairy producer, Arla Foods; and
  • in New Zealand, a 17,150 sqm warehouse for Frucor Beverages.

The acquisition and replenishment of Goodman’s controlled land inventory continued to be a focus during the period, predominantly in North America, China and Japan. This will ensure that we remain appropriately positioned to capitalise on the opportunities available across all of Goodman’s operating markets stemming from the strong customer and investor demand for high quality industrial assets, while facilitating the ongoing rollout of our development pipeline. As a result, we have maintained our development pipeline at in excess of $10 billion, capable of delivering a forecast gross lettable area of over 7 million sqm.

 1.2m sqm

of new space delivered