The strong ongoing growth in Goodman’s development activities is being driven by the undersupply of prime quality industrial space and structural changes taking place within our sector. This is generating significant customer and investor demand for new development product and Goodman was well positioned throughout the year to pursue the best quality projects available across all of its key operating markets. The ability to leverage our specialist capability, extensive infrastructure and expert people around the world remains a key point of differentiation, ensuring Goodman’s development volumes continued to grow and enhancing its position as one of the world’s largest developers of industrial real estate. We commenced the development of $2.5 billion of new space in the 2014 financial year across 78 projects in 11 countries, with a forecast yield on cost of 8.4%. We achieved an average lease term of 9.8 years on these new developments and demonstrated our commitment to a low risk development approach, with 86% either pre-sold to, or pre-funded by, Goodman’s managed funds or third parties.
Commenced developments include:
- a 31,892 sqm distribution centre in Brisbane for international logistics provider, DB Schenker;
- in Auckland, New Zealand, a 16,002 sqm head office for dairy company, Fonterra;
- a 64,988 sqm regional distribution centre for automobile manufacturer, BMW Brilliance Automotive, at Yanjiao, China;
- in Tokyo, Japan, two multi-customer logistics and distribution facilities of 64,160 sqm and 57,905 sqm respectively;
- a 103,664 sqm logistics centre for logistics service provider, Hammer Group, in Bedburg, Germany;
- a 123,469 sqm fulfilment centre in Wroclaw, Poland for e-commerce provider, Amazon;
- in Hinckley, United Kingdom, a 30,669 sqm logistics facility for French express parcel business, GeoPost;
- a 148,699 sqm multi-customer logistics centre at Rancho Cucamonga in Southern California, United States; and
- Itupeva, a 60,737 sqm multi-customer industrial estate in São Paulo, Brazil.
We commenced the development of $2.5 billion of new space in the 2014 financial year across 78 projects in 11 countries.
sqm of new space delivered
Development work in progress as at June 2014
- Greater China 23%
- Continental Europe 19%
- Australia 17%
- Japan 17%
- New Zealand 10%
- North America 6%
- UK 5%
- Brazil 3%
Consistent with the strong demand for prime quality industrial space globally, Goodman’s development work in progress increased to $2.6 billion compared with $2.3 billion for the same period last year. We have active developments underway in all of our regions, reflecting the robust market conditions, with additional capital allocated to markets where we are undertaking a development led strategy, including Japan, China, North America and Brazil. We are currently undertaking 76 projects in 11 countries, equating to 2.2 million sqm of new logistics and business space, with 91% of these projects being undertaken on behalf of our managed funds or third parties.
Over the 12 month period, Goodman delivered 1.6 million sqm of new space across 71 projects globally, with a combined value of $2.2 billion. Developments completed during the year include:
- a 53,305 sqm warehouse and distribution facility in Western Sydney for transport distribution company, Toll IPEC;
- in Melbourne, a 21,117 sqm warehouse facility for fashion and apparel retailer, Just Group;
- a 102,949 sqm warehouse and distribution centre in Tianjin, China, for leading local e-retailer, Vipshop;
- the 130,059 sqm Goodman Sakai warehouse and distribution facility at Osaka Bay, Japan, on behalf of a number of third party logistics providers, including major customer, Nippon Express;
- in Bremen, Germany, a 35,666 sqm logistics centre for automobile manufacturer, Daimler;
- a 99,525 sqm fulfilment centre for e-commerce provider, Amazon, at Lauwin-Planque, France;
- a 58,274 sqm distribution centre at Derby, United Kingdom, for global logistics provider, Kuehne + Nagel and Heineken;
- in Oakland, United States, a 34,813 sqm logistics centre, partially leased to paint retailer, Benjamin Moore; and
- phase one of International Business Park, a 57,242 sqm multi-customer estate in Rio de Janeiro.
Goodman ensured that it remains well positioned to effectively respond to the high customer and investor demand for its development product and facilitate the ongoing rollout of its development pipeline by replenishing its controlled land inventory during the year. This was primarily undertaken in North America, China and Japan, resulting in our development pipeline being maintained at over $10 billion and capable of delivering a forecast gross lettable area of more than 7 million sqm.