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GOODMAN GROUP Investor Presentation 2014

Oct 12, 2014

64998_rns_2014-10-12_3f928bd5-bddb-48f7-9a9a-e0e66c453770.pdf

Investor Presentation

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13 October 2014

The Manager Company Notices Section ASX Limited Exchange Centre 20 Bridge Street SYDNEY NSW 2000

Dear Sir / Madam,

GOODMAN GROUP (GOODMAN) AUSTRALIAN AND NEW ZEALAND PROPERTY TOUR

Attached is a presentation provided as part of a Sydney, Melbourne and Auckland property tour to be undertaken this week.

Please do not hesitate to contact the undersigned if you require further information.

Yours faithfully

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Carl Bicego Company Secretary

Goodman Group

Goodman Limited | ABN 69 000 123 071 Goodman Funds Management Limited | ABN 48 067 796 641 | AFSL Number 223621 as responsible entity of Goodman Industrial Trust | ARSN 091213 839 Level 17, 60 Castlereagh Street, Sydney NSW 2000 | GPO Box 4703, Sydney NSW 2001 Australia Tel +61 2 9230 7400 | Fax +61 2 9230 7444 Goodman Logistics (HK) Limited | Company No. 1700359 | ARBN 155 911 149 | a Hong Kong company with limited liability Suite 2008, Three Pacific Place, 1 Queen’s Road East, Hong Kong | Tel +852 2249 3100 | Fax +852 2525 2070 [email protected] | www.goodman.com

Goodman Group Australia + New Zealand Property Tour

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Global partner + Global platform
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Contents

    • Section 1
    • Section 2
    • Section 3

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Sydney – Jason Little: General Manager, Australia

  • Melbourne – Travis Hardman: General Manager, VIC / SA / WA

  • Auckland – John Dakin: CEO, New Zealand

2

Important notice and disclaimer

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    • This document has been prepared by Goodman Group (Goodman Limited (ABN 69 000 123 071), Goodman Funds Management Limited (ABN 48 067 796 641; AFSL Number 223621) as the Responsible Entity for Goodman Industrial Trust (ARSN 091 213 839) and Goodman Logistics (HK) Limited (Company Number 1700359; ARBN 155911142 – A Hong Kong company with limited liability)). This document is a presentation of general background information about the Group’s activities current at the date of the presentation. It is information in a summary form and does not purport to be complete. It is to be read in conjunction with Goodman Group’s other announcements released to ASX (available at www.asx.com.au). It is not intended to be relied upon as advice to investors or potential investors and does not take into account the investment objectives, financial situation or needs of any particular investor. These should be considered, with professional advice, when deciding if an investment is appropriate.
    • This document contains certain "forward-looking statements". The words "anticipate", "believe", "expect", "project", "forecast", "estimate", "likely", "intend", "should", "could", "may", "target", "plan" and other similar expressions are intended to identify forward-looking statements. Indications of, and guidance on, future earnings and financial position and performance are also forward-looking statements. Due care and attention has been used in the preparation of forecast information. Such forward-looking statements are not guarantees of future performance and involve known and unknown risks, uncertainties and other factors, many of which are beyond the control of the Group, that may cause actual results to differ materially from those expressed or implied in such statements. There can be no assurance that actual outcomes will not differ materially from these statements. Neither the Group, nor any other person, gives any representation, warranty, assurance or guarantee that the occurrence of the events expressed or implied in any forward looking-statements in this document will actually occur.
    • This document does not constitute an offer, invitation, solicitation, recommendation, advice or recommendation with respect to the issue, purchase, or sale of any stapled securities or other financial products in the Group.
    • This document does not constitute an offer to sell, or the solicitation of an offer to buy, any securities in the United States or to any “US person” (as defined in Regulation S under the US Securities Act of 1933, as amended (Securities Act) (US Person)). Securities may not be offered or sold in the United States or to US Persons absent registration or an exemption from registration. The stapled securities of Goodman Group have not been, and will not be, registered under the Securities Act or the securities laws of any state or jurisdiction of the United States.

3

Sydney cover page

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Sydney market considerations

Planning /
Infrastructure
+
Established arterial road network
+
Major port upgrade – third container terminal
+
Planned rail intermodals at Enfield and Moorebank
+
Major road infrastructure planned – Westconnex
+
Extension of employment lands zone will focus infrastructure planning and expenditure in the outer west
Population /
Gross State
Product
“GSP”¹
+
Total population ~4.7 million, growth in 2012 of 1.3%. Represents ~78% of the total state population
+
Density of 380 people per sq km
+
Forecast population of 5.5 million by 2026
+
GSP growth (to 2020) – 2.5% pa
+
Natural geographic barriers around the Sydney basin region (Blue Mountains to the west, National Parks to the North and South
+
Population centre of Sydney is within close proximity to the outer western Sydney industrial precinct
+
South Sydney industrial precinct is constrained by commercial / residential take up
Geography
Market Location
South
+
Proximity to airport, CBD and Port (Port Botany expansion)
+
Supply constrains and industrial stock withdrawal
+
Brownfield sites providing redevelopment / adaptive reuse
South West
+
Access to M5 and road orbital
+
Site for planned intermodal with development led logistics focus
+
Limited land supply; demand pressures from constrained South market
Outer West
+
Access to motorway network, beneficiary of infrastructure
+
Attractive to large corporate and logistics users
North (Macquarie Park/ North Ryde)
+
Transition market located 20 mins from the Sydney CBD with access to key infrastructure
+
Reposition existing stock through leasing, development and adaptive reuse initiatives
+
Total population ~4.7 million, growth in 2012 of 1.3%. Represents ~78% of the total state population
+
Density of 380 people per sq km
+
Forecast population of 5.5 million by 2026
+
GSP growth (to 2020) – 2.5% pa
Market Location South
+
Proximity to airport, CBD and Port (Port Botany expansion)
+
Supply constrains and industrial stock withdrawal
+
Brownfield sites providing redevelopment / adaptive reuse
South West
+
Access to M5 and road orbital
+
Site for planned intermodal with development led logistics focus
+
Limited land supply; demand pressures from constrained South market
Outer West
+
Access to motorway network, beneficiary of infrastructure
+
Attractive to large corporate and logistics users
North (Macquarie Park/ North Ryde)
+
Transition market located 20 mins from the Sydney CBD with access to key infrastructure
+
Reposition existing stock through leasing, development and adaptive reuse initiatives

5

  1. Source: Deloitte access economics 2011

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Greater Sydney

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6

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Sydney South Region

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7

Sydney Corporate Park

    • Purchased in December 2013 for $343 million, Sydney Corporate Park (SCP) is a 14.4 hectare site situated in South Sydney’s
  • industrial precinct

    • SCP currently comprises a mix of industrial, business space and showroom / retail, accommodating over 80 customers and a daily workforce in excess of 3,500 people
    • Located 10 minutes from Mascot train station. A complimentary bus service operates to Central and St Peters stations
    • A strategic long-term asset which presents an opportunity to take advantage of the property’s existing infrastructure and to add value through further site improvements
    • Potential for future rezoning to a higher and better use. Council has already exhibited a draft precinct plan which shows SCP achieving an uplift FSR to 2:1
Zoning FSR GLA
As built 0.8:1 117,156 sqm
Current zoning
IN1 Industrial
1.5:1 215,550 sqm
Proposed zoning B6
enterprise
2:1 287,400 sqm

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GLA 117,156 sqm
Ownership GAIF
Number of customers 84
Occupancy 76%
WALE 3.4years
Key Customers +
Officeworks
+
Trivett
+
The Nuance Group
+
Breville

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8

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Alexandria Industrial Estate

GLA 43,750 sqm
Ownership GAIF
Number of customers 26
Occupancy 98%
WALE 2.4
Key Customers +
Bremick
+
Equada
+
Wilkhahn
    • Alexandria Industrial Estate (AIE) is a multi-unit industrial estate located on the corner of Bourke Road and Collins Street in the South Sydney suburb of Alexandria, approximately 6km south of the Sydney CBD
    • AIE has a total site area of 6.1 hectares and is in close proximity to Port Botany Container Terminal, Sydney Airport and Sydney CBD
    • The site offers flexible space to suit a variety of users including creative, light industrial and bulky goods
    • Benefits from surrounding amenity of cafes, recreational facilities, convenience retail and bulky goods retail all in close proximity

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    • In the longer term, management see the site as a potential mixed use re-development site

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9

Mitchell Industrial Estate

    • Mitchell Industrial Estate is positioned in Sydney’s city fringe and boasts close proximity to the CBD (1.1km), airport (3.9km) and port (7.6km)
    • Substantial and efficient infrastructure and amenity in the local area such as cafés and convenience retail in adjoining Sydney Park Village, as well as walking distance to Erskineville town centre
    • The site is located within the Ashmore precinct, a key brownfield urban renewal area as identified by the NSW Department of Planning and the City of Sydney
    • The site can accommodate increased density and population growth supported by established infrastructure being within 800m of St Peters and Erskinville station
    • Management's current plans estimate that 1,763 apartments can be constructed on the combined Mitchell Road site

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GLA 36,570 sqm
Ownership GMG
Number of customers 9
Occupancy 100%
WALE 2.2 years
Key Customers +
Toll
+
Estée Lauder
+
Recall

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10

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Moorebank – Sydney South West Region

Currently 7 intermodal terminals operating in Sydney including Cooks River, Chullora and Minto

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Enfield is currently under development and Moorebank is in planning

Qube and Aurizon are in exclusive negotiations to develop and run the Moorebank Intermodal Terminal

Whilst previously there was two competing sites. A ‘whole of precinct’ approach is expected to be more efficient and will provide more space for onsite warehousing and other related terminal facilities

Combined the two sites would cater for 2 million TEU's (twenty foot containers) per annum

Connection via the Southern Sydney Freight Line (SSFL), M5 and M7 motorways

SSFL on completion will result in dedicated freight line from Port Botany to Macarthur

Handle both interstate and Port Botany container traffic

Estimated 3,300 trucks a day taken off Sydney roads between Port Botany and Moorebank by shifting to rail

Goodman assets well located in the Moorebank intermodal catchment area

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Moorebank Business Park

GLA 81,739 sqm
Ownership GTA
Number of customers 8
Occupancy 100%
WALE 5.0
Key Customers +
Toyota
+
Electrolux
+
BMW
    • The property is strategically located in the established Moorebank Industrial precinct being 37km south of Sydney CBD
    • With access via M5 Motorway, the property enjoys direct connectivity to Sydney Port and Airport to the east and the M7 Motorway to the west
    • The property comprises five modern warehouses with good clearance with associated office and hardstand
    • The property accommodates major customers in Toyota, Electrolux, and BMW due to its proximity to the M5 Motorway

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    • The property will be a beneficiary of the proposed Moorebank intermodal that will be located directly opposite on Moorebank Avenue

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Sydney Outer West Region

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13

M7 Business Hub

    • The M7 Business Hub is located in the premier Eastern Creek industrial precinct 36km west of CBD
    • Prominently located near the M4 and M7 Motorway, the property enjoys connectivity to the Port via the M7 Motorway to the south and to the broader western industrial market to the west
    • The property comprises large distribution warehouses, cold storage facility, cross dock facility and a unit estate catering to a broad market
    • The Business Hub provides accommodation for blue chip Customers in Coca Cola and Westfarmers housing both Coles dry and cold storage facilities
    • Land sourced from the original Brickworks joint venture

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GLA 211,812 sqm
Ownership GAIF
Number of customers 18
Occupancy 99%
WALE 13.5 years
Key Customers +
Coles
+
Coca Cola
+
Toll

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14

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Bungarribee Industrial Estate

GLA 215,465 sqm
Ownership GAIF / GADF
Number of customers 6
Occupancy 100%¹
WALE 15.8 years
Key Customers +
Metcash
+
Toll
+
BOC
+
Linfox
+
Beaumont Tiles
    • Bungarribee Industrial Estate is located within the established industrial precinct of Huntingwood, adjacent to the junction of the M4 and M7 motorways. This location offers customers significant logistical efficiencies.
    • The estate has been developed to accommodate purpose-built facilities for Metcash, Linfox and Toll IPEC due to its quality masterplanning, sustainability initiatives and strategic location

1. On completed projects

Customer GLA sqm WALE
Linfox & Beaumont Tiles 23,819 6.2
Toll IPEC 53,305 19.7
Metcash 92,173 19.3
BOC & Speculative 18,600 7.9
Confidential 10,768 10.0
Speculative (5B) 16,800 n/a
Total 215,465 15.8

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15

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Sydney Inner West Region

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16

IBC Business Estate

    • 12 hectare estate conveniently located adjacent to the Sydney Olympic Park precinct
    • The estate is located approximately 16km west of the Sydney CBD and 7 km east of the Parramatta CBD. It has good access to the M4 Motorway with west bound access and east bound access 200 metres away
    • During the Sydney Olympics it was used to house the international media broadcasters – IBC stands for International Broadcasting Centre
    • The facility consists of a large, stand alone office/warehouse facility of 62,616 sqm that is occupied by four customers and one stand alone cross dock facility at the rear of the site leased to TNT. Grays Online are the main customer on site with 33,500 sqm
    • The estate forms part of Goodman's holding within the Carter Street precinct. In December 2012, the NSW Department of Planning endorsed Carter Street as a future Urban Activation Precinct. This is due to the sites proximity to Sydney Olympic Park and its associated amenity
    • The Carter Street Urban Renewal precinct went on public exhibition in mid 2014

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GLA 62,616 sqm
Ownership GMG
Number of customers 5
Occupancy 79%
WALE 5.2 years
Key Customers +
Grays Online
+
TNT
+
Super Retail Group

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17

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Carter Street Precinct

Ownership GMG
Site Area 27.0 ha
Current zone B7 Business Park
Proposed zone +
R4 high density residential + B2 town centre (retail
and commercial)
+
4,025 lots, FSR of 2:1
Relevant Authority Department of Planning / Auburn Council
Timing for approval Q2 2015
Planning Actions
Current Negotiate planning outcomes with the Department of
Planning:
+
FSR provisions
+
Developer contributions (Voluntary Planning
Agreement)
2014 +
Prepare and lodge Master Plan, including subdivision
+
Prepare staged disposal strategy
2015+ 18
+
Finalise structure Plan / rezone
+
Market site

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Melbourne cover page

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Melbourne market considerations

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Planning /
Infrastructure
+
Established arterial road network
+
Port expansion will allow up to an additional 1.0 million TEU’s pa
+
Efficiency improvements at Swansons Dock
+
New deep water shipping port proposed at Hastings
Population /
Gross State
Product “GSP”¹
+
Total population ~4.3 million, growth in 2012 of 1.8%. Represents ~76% of the total state population
+
Density of 430 people per sq km
+
Forecast population of 5.3 million by 2026
+
GSP growth (to 2020) – 2.6% pa
+
Constraints around Port Melbourne due to commercial / residential take up
+
Infrastructure improvements planned around the Melbourne 2030 boundary, however land supply in west and outer south
east industrial precincts is in plentiful supply
Geography
Market Location
South East
+ Established industrial market, well serviced by road and rail
+ Traditional manufacturing / logistics base
West
+ Established industrial market with strong access to port and CBD
+ Access to major arterial roads
+ Abundance of available industrial land will limit growth
Port
+ Close proximity to CBD
+ Direct access to arterial road network
+ 240ha of industrial land rezoned to Capital City zone placing further pressure on available industrial land
+
Total population ~4.3 million, growth in 2012 of 1.8%. Represents ~76% of the total state population
+
Density of 430 people per sq km
+
Forecast population of 5.3 million by 2026
+
GSP growth (to 2020) – 2.6% pa
Market Location South East
+ Established industrial market, well serviced by road and rail
+ Traditional manufacturing / logistics base
West
+ Established industrial market with strong access to port and CBD
+ Access to major arterial roads
+ Abundance of available industrial land will limit growth
Port
+ Close proximity to CBD
+ Direct access to arterial road network
+ 240ha of industrial land rezoned to Capital City zone placing further pressure on available industrial land
  1. Source: Deloitte access economics 2011

20

Greater Melbourne

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+ insert map highlight all properties
Section 2+
Global
development
business
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21

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Fishermans Bend, Port Melbourne

Ownership GMG + Funds
Site Area 28.9 ha
Lots 9,917 complying
Current zone Capital City Zone
Relevant Authority Dept of Planning / Melbourne City / Port Melbourne
Timing for approval Estimated 2015
Planning Actions
Current +
Compare the concept master plan with the newly
released Strategic Framework Plan
+
Awaiting approval for the Lorimer Street planning
permit consisting 1,350 apartments (site 3)
2014 Negotiate with the Authorities:
+
Parking provisions
+
Developer contributions
+
Public contributions
2015 Master Planning Permit Approval
2016+ 22
Subdivision and staged disposal strategy

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Auckland cover page

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Auckland market considerations

    • Greater Auckland has a population of 1.5 million, 33% of the 4.5 million national total

Population / Gross Domestic Product “GDP”¹

    • Forecast population of 2.0 million by 2026 and 2.5 million by 2041 under the Councils high growth assumptions
    • Population density of around 1,250 people per square kilometre

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    • Forecast GDP growth of 2.8% pa
    • Auckland is geographically constrained and also limited by a Rural Urban Boundary that restricts development potential

Geography

    • Industrial land supply outside these boundaries is plentiful but development ready opportunities are limited and tightly held
    • Major commercial gateway, 60% of imports and 30% of exports come through Auckland ports, 85% of airfreight moves through Auckland airport
    • Established arterial road network that is being extended with a second motorway loop linking the south, west and north

Planning / Infrastructure

    • New infrastructure is being complemented by public transport initiatives such as the electrification and extension of the rail network + Ultra-fast broadband network being created with roll out of new fibre network
    • Waterfront Auckland is the Council entity overseeing the transformation of the industrial port area into a vibrant mixed-use zone that incorporates public amenity and recreational spaces

Industrial

    • Established industrial markets in Central and South Auckland, the North Shore is around half the size of these more established areas
    • Port located centrally in the City – with the Inland Port and Metro Port distribution hubs established in Penrose and Wiri
    • Fundamentals strong with vacancy below 4% (10 million sqm of industrial space) and even lower for prime stock
    • Land supply issues will limit growth in Central Auckland and there are limited opportunities for larger 3PL’s wanting new facilities
    • Cap rates between 6.5-7.0% for brand new, high quality stock offering strong lease covenants

Market Location

    • Forecast rental growth of around 2.5% over next 2-3 years

Suburban Office

    • Larger suburban office markets are located in the Viaduct, Greenlane Corridor, Newmarket and Takapuna commercial areas.
    • Around 700,000 sqm of stock in total, with vacancy ranging from 3% to 9% across the locations
    • The development of the Viaduct Harbour is expected to add up to 170,000 sqm of additional commercial space over time
    • Easier access, greater amenity, higher car parking ratio’s together with lower rental and opex rates make suburban office locations a more cost effective proposition than the CBD for many businesses
    • Variety of stock ranging from small stand alone office buildings of older design to modern campus style estates comprising a number of large floor plate low rise buildings
  • New Zealand Trade and Enterprise

24

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Greater Auckland

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Section 2+
Global
development
business
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25

Viaduct Harbour

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KPMG
Vodafone
Fonterra
Microsoft
and HP
Air NZ
Current Goodman
Assets Group sites
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26

Viaduct Harbour

    • The Viaduct Harbour refers to a rapidly growing commercial precinct to the west of Auckland's CBD
    • Local government has prioritised its development with a special zoning to facilitate its transformation from an industrial port area into a vibrant mixed-use zone that includes 1,000 residential units Section 2+
    • The 20 hectare site is in mixed own ~~ership, but~~ predominantly owned by Waterfront Auckland, Viaduct Harbour Holdings Limited, and Goodman Group
    • The revitalisation is expected to support 170,000 sqm of new commercial development, doubling the existing stock
    • GMT owns the Air New Zealand Building and the new Fonterra Building (under development). It also has a 50% interest in VCCL, the joint venture that owns the Vodafone, KPMG, and Microsoft Buildings
    • Mixture of leasehold and freehold land ownership opportunities

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Section 2+
dly growing
uckland's CBD
development with a
rmation from an
ed-use zone that
NLA 62,880 sqm
Ownership GMT
Number of customers 14
Occupancy 100%
WALE 7.3 years
Key Customers +
Air NZ
+
Fonterra
+
Hewlett Packard
+
KPMG
+
Microsoft
+
Vodafone
~~rship, but~~
Auckland, Viaduct
man Group

Note: The metrics in the table above includes the Fonterra building which is still under construction.

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27

Viaduct Harbour – stabilised assets

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Air New Zealand

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    • Market value of NZ$64.0 million
    • 15,588 sqm 4.8 year WALE
    • Head office of Air New Zealand
    • Building was completed early 2006

Fonterra

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    • Expected completion in January 2016
    • Purchase price of NZ$92.6 million
    • 16,000 sqm
    • 15 year lease term
    • Pre-let campus style office building, sold to GMT ahead of completion

Viaduct Corporate Centre Limited (VCCL)

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    • Three separate buildings
    • Market value of NZ$156.2 million
    • 31,290 sqm
    • 3.7 year WALE
    • Customers include Vodafone, KPMG and Microsoft
    • GMT has a 50% interest in VCCL

28

Viaduct Harbour – future opportunities

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Buildin C / VXV3 g

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    • Uncommitted development adjoining Fonterra
    • Approximate completion value of NZ$50 million
    • 8,813 sqm NLA, six level A grade office development + Expected completion in May 2016
    • Leasehold tenure

Wynyard Quarter land site

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    • Freehold site with an area of 9,793 sqm
    • Integrated Development Plan to be modified to provide better separation of residential and commercial uses
    • Supports 2-3 office buildings with total area of up to 24,000 sqm
    • Residential site expected to support 200-250 apartments
  • Site is adjacent to the GMT owned Air New Zealand building

29

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East Tamaki

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30

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Highbrook Business Park

Sectio
k situated
in
, including
ange have

with
~~ce already~~
NLA 324,000 sqm
Ownership GMT
Number of customers 72
Occupancy 99.9%

WALE
7.1 years
~~2+~~
ment
Key Customers
+
DHL
+
Ford
+
IBM
+
NZ POST
+
Panasonic
Global
develop

pport a
of around
    • Highbrook is an award wining business park situated within 150 hectares of landscaped grounds in Auckland’s East Tamaki
    • Its strategic location and new infrastructure, including the Waioruru Bridge and motorway interchange have been the catalyst for its rapid development
    • The estate is approximately 60% complete with Sectio 324,000 sqm of industrial and business sp ~~ace already~~ developed or under construction
  • Global

    • Once complete the estate is expected to support a workforce of up to 15,000 and have a value of around develop NZ$1.5 billion business

Note: The metrics in the table above includes current developments that are under construction.

    • Unrivalled amenity and close proximity to the CBD, port and airport make it a suitable location for a wide range of business uses

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    • A world class business park that combines people and industry in an exceptional natural landscape

31

Highbrook in detail +

Integrated design

Functional systems like the stormwater ponds are designed to integrate with the landscape and feature wetland plants that aid water quality while acting as a natural barrier.

The Tamaki River

Once an important transport route for the local iwi the Tamaki River now supports recreational users.

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Sustainable building

Development

Views

The location and orientation of property assets maximise the water and city views that encompass One Tree Hill, Rangitoto, the Sky Tower and Mount Wellington.

All facilities at Highbrook share a consistent design theme that incorporates sustainable design elements – providing customers with modern, efficient and flexible workplaces.

progress

More than 60% of the planned 530,000 sqm of rentable area has already been developed, with the estate accommodating more than 50 businesses.

Pukekiwiriki Crater

Expansion options

Lollipops Educare

One of the oldest extinct volcanic craters in Auckland, the rim rises twenty metres above the river terrace and provides the base for a range of recreational pursuits.

Childcare facilities are one example of the type of amenity offering provided at Goodman’s larger estates.

Many customers negotiate expansion options as part of their lease agreements, allowing the space and flexibility to grow.

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The Crossing

12 km of running and cycling tracks

Highbrook Drive

Connects Highbrook Business Park with SH1. With around 28,000 vehicle movements every day, it has quickly become a major new arterial route.

A modern and vibrant mixed-use development that features food, hospitality and retail options supported by office and accommodation facilities.

Linking recreational areas and complementing the existing and planned amenity that differentiates the estate.

32

thank+ you

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33