GOODMAN GROUP — Investor Presentation 2017

Jul 24, 2017

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25 July 2017

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

Dear Sir / Madam,

GOODMAN GROUP (GOODMAN) – Dispatch of investor newsletter to Securityholders

Attached is the Goodman investor newsletter dispatched to Securityholders today and available on the Goodman website at www.goodman.com.

Please contact the undersigned in relation to any queries.

Yours sincerely

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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 info-au@goodman.com | www.goodman.com

I N T H E C O M M U N I T Y

Raising funds in Australia and Hong Kong for those in need.

F I N A N C I A L F L E X I B I L I T Y

Updates on recent capital management initiatives.

D E V E L O P M E N T U P D AT E

$A3.5 billion development workbook across 75 projects.

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IN V E S T OR
J U L Y 2 0 1 7
INSIGH T
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IN OUR LATEST QUARTERLY UPDATE TO THE MARKET,
GOODMAN DELIVERED A STRONG OPERATING PERFORMANCE
WITH A CONTINUED FOCUS ON GENERATING
SUSTAINABLE LONG-TERM GROWTH
Sydney, Australia
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STRATEGY AND OPERATIONAL UPDATE

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U R B A N I S AT I O N O F G AT E WAY C I T I E S A RO U N D T H E W O R L D I S D R I V I N G B U S I N E S S D E C I S I O N S

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70%
50%
29%
81 [%]
1950 2000 2050
The proportion of people living in Large cities will account for 81%
cities is growing faster than ever of global consumption by 2030
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Source: Urban world: The Global Consumers to watch, McKinsey Global Institute April 2016.

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We’re continuing to realise the benefits of our strategy which has consistently been to invest and develop in quality locations, close to the consumer. We believe demand for quality industrial properties will be strongest in these locations and scarcity of land will see higher values, supporting sustainable long-term growth.

GREG GOODMAN, GOODMAN GROUP CEO

Shanghai, China

$23 trillion (USD)

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TOKYO
BEIJING
38M
LONDON
20.4M
10.3M OSAKA
SHANGHAI
PARIS
LOS ANGELES
12.3M 18.6MNEW JERSEY 10.8M 23.7M HONG KONG 20.2M
7.3M SYDNEY
4.5M
SÃO PAULO
21.1M
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In 2030, global consumption will We are positioning our properties close Offering our customers quality have increased by $23 trillion to areas of high population growth properties close to consumers

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OUR GATEWAY CITY STRATEGY t Goodman, the quality and location of our properties have always been key factors in making investment decisions and they define the composition of our overall global A property portfolio. We focus on investing in and developing high quality industrial properties in strategic locations, in and around major gateway cities globally. It is in these locations, where demand is strong and transformational changes in our industry are driving significant opportunities for our business. The macro themes currently driving demand for modern, well located logistics space include:

• + Greater urbanisation of our cities.

• + The growth in consumerism.

• + The evolution of e-commerce and enabling technologies, which is changing consumer behaviour.

• + Our customers’ focus on getting more value from their property solutions and achieving cost efficiencies through supply chain efficiencies.

READ MORE ON GOODMAN.COM

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KEY FACTS – FOR THE NINE MONTHS TO 31 MARCH 2017

OWN

TOTAL ASSETS UNDER MANAGEMENT $34.6[bn]

Assets under management (AUM) saw valuation growth across the portfolio for our existing properties but this was offset by the asset sales. Total AUM includes assets held directly on the Group’s balance sheet and within Partnerships.

SQUARE METERS LEASED

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2.5 [m]
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2.5 million square metres of property was leased over the period equating to A$296 million of annual net property income.

OCCUPANCY

96[%]

Our occupancy levels were maintained at 96% and importantly retention rates remained high at 81%, demonstrating the quality and location of our assets.

DEVELOP

DEVELOPMENT WORK IN PROGRESS

$3.5[bn]

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Our A$3.5 billion development work in progress is spread across our regions with 35% in Europe, 28% in Asia, 24% in Australia and New Zealand and 13% in the Americas.

DEVELOPMENT COMMENCEMENTS

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$2.1 [bn]
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New developments are being selectively targeted within our gateway cities, with 65% pre-sold to Partnerships or third parties.

DEVELOPMENT COMPLETIONS

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$2.0 [bn]
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We have maintained our prudent approach to development with 86% of our development completions pre-leased to customers.

MANAGE

EXTERNAL ASSETS UNDER MANAGEMENT

$30.0[bn]

External assets under management have remained steady at A$30 billion with the Group continuing to balance the strategic asset rotation program with its strong development workbook.

ASSETS DISPOSED $2.1[bn]

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The Group sold A$2.1 billion of assets in the nine months to 31 March 2017 (excluding urban renewal) to fund the development pipeline and concentrate our portfolio in large, wealthy consumerdominated cities around the world.

UNDRAWN DEBT AND EQUITY

$10.3[bn]

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The Partnerships remain well capitalised with $10.3 billion in undrawn debt and equity, providing capacity to leverage selective growth opportunities.

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The Group has been actively reducing gearing in the business, given our desire to run low financial leverage at this point in the property cycle.

GREG GOODMAN, GOODMAN GROUP CEO

IMPROVING FINA FLEXIBILITY

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CAPITAL MANAGEMENT

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We continue to improve our financial and operational flexibility with a number of capital management initiatives completed in the financial year to date.

• • Group gearing range formally reduced to 0%–25% (from 25%– 35%), this is consistent with practice in recent years.
• • The gearing level will be determined with reference to the mix of earnings and ratios consistent with our credit rating.
• • We closed a US$1billion Exchange Offer of 144a Bonds in the US market.
• • These changes resulted in an improved credit rating for the Group with S&P upgrading to BBB+ and Moody’s upgrading to Baa1.

Overall our capital management approach is focussed on long term flexibility, providing the ability to absorb changes in market volatility.

Gearing (%)

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23.9
19.5
18.5
17.3
11.8
8.7
FY12 FY13 FY14 FY15 FY16 1H FY17
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DEVELOPMENT UPDATE

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P R U D E N T A P P ROAC H T O D E V E L O P M E N T

Goodman continues its prudent approach to development and has a development workbook of $3.5 billion across 75 projects around the world (as at 31 March 2017).

Development WIP ($bn)

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3.5
3.4
3.1
2.6
2.3
1.9
FY12 FY13 FY14 FY15 FY16 Q3 FY17
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Structural and cyclical themes continue to provide positive tailwinds for the Group with developments positioned to take advantage of the growth of ecommerce, the change in consumer spending and the flow-on effects these have on well-located, high-quality industrial properties.

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GOODMAN HAMBURG III
LOGISTICS CENTRE, GERMANY
34,984 sqm development in Hamburg, Germany.
This is Goodman’s third development in the area
with the previous two phases fully leased.
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GOODMAN LOGISTICS CENTRE, SANTA FE SPRINGS, USA

27,451 sqm logistics facility for an ecommerce customer at Goodman Logistics Centre in Santa Fe Springs.

Artist's impression

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Artist's impression
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LYONS PARK, COVENTRY,
WEST MIDLANDS, UK
43,378 sqm distribution centre for ecommerce
giant Amazon, in Lyons Park, Coventry.
Artist's impression
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WORKBOOK

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IN THE COMMUNITY

A U S T R A L I A’S BI G G E S T M O R N I N G T E A

Partnering with our neighbours to raise funds for Cancer Council in Australia

Goodman’s head office in Australia joined forces with stockbroking firm Shaw and Partners, to host an inaugural 'Community Biggest Morning Tea' for all tennants of 60 Castlereagh Street in Sydney. The morning tea held in May, was themed as a 'celebration of survival' to raise awareness of the support services available to cancer survivors and their families.

Cancer survivor Gillian Marks, a Goodman employee and member of the organising committee, is five years cancer free and puts her survival down to a number of things, including feeling supported by her community, her employer and Cancer Council.

The morning was an outstanding success raising more than A$55,000 for Cancer Council including staff donations and funding from Shaw and Partners and Goodman Foundations.

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Australia’s Biggest Morning Tea
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It was with the help of Cancer Council through its counselling service, the support of Goodman and a neighbourhood walking group that I found the strength I needed to get through my cancer journey

GILLIAN MARKS, GOODMAN STAFF MEMBER

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Goodman Interlink Magic Mile Charity Ramp Run 2017
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G O O D M A N I N T E R L I N K M AG I C M I L E I N H O N G KO N G

Running the ramp for Feeding Hong Kong

For six years, Goodman has hosted the Goodman Interlink Magic Mile Charity Ramp Run, raising funds for various charities in Hong Kong. This year’s event held in March, saw the Goodman Foundation and major sponsors raise over HK$1 million for Feeding Hong Kong, the first food bank in Hong Kong dedicated to redistributiong surplus food to people in need.

Cheering spectators encouraged over 400 participants to race up and and down the 15-floor one mile truck ramp of Goodman Interlink, a landmark warehouse and distribution property located in Tsing Yi, Hong Kong.

Mr. Kristoffer Harvey, Goodman’s Chief Executive Officer, Greater China, said, “We are proud to have raised over HK$1 million for Feeding Hong Kong and are delighted it will provide 200,000 meals to underprivileged families in Hong Kong.”

The high profile event has raised approximately HK$5 million for charities across Hong Kong, including Feeding Hong Kong, and has attracted more than 1,500 participants over the past six years.

We are very grateful to Goodman and its sponsors for their generosity and effort in organizing this impressive event that will go a long way in helping our cause. The substantial donation will provide extra meals to families in need and help support our food bank operations to deliver food to local charities and schools

GABRIELLE KIRSTEIN, EXECUTIVE DIRECTOR, FEEDING HONG KONG

VIEW MAGIC MILE VIDEO ON GOODMAN.COM

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SECURITYHOLDER INFORMATION

U P C O M I N G K E Y DAT E S

21 August 2017 Announcement of full year results 28 August 2017 Estimated distribution payment date 16 November 2017 Annual General Meeting

Note: Future dates may be subject to change.

G O O D M A N G R O U P	O F F I C E	S E C U R I T Y R E G I S T R A R
Goodman Limited	Registered offces	Computershare Investor	Securityholders can update
ABN 69 000 123 071	Level 17	Services Pty Limited	the following information with
Goodman Industrial Trust ARSN 091 213 839	60 Castlereagh Street Sydney NSW 2000	Level 5 115 Grenfell Street	Computershare online at www.investorcentre.com:
Responsible Entity Goodman Funds Management Limited ABN 48 067 796 641 AFSL Number 223621 Goodman Logistics (HK) Limited Company No. 1700359	GPO Box 4703 Sydney NSW 2001 T: 1300 791 100 (within Australia) +61 2 9230 7400 (outside Australia) F: +61 2 9230 7444	Adelaide SA 5000 GPO Box 1903 Adelaide SA 5001 T: 1300 723 040 (within Australia) +61 3 9415 4043 (outside Australia)	– change of address details; – request to receive communication online; – request to have payments made directly to a bank account; – provision of tax fle numbers; or – general queries about your securityholding.
ARBN 155 911 149	Suite 901, Three Pacifc Place, 1 Queen’s Road East, Hong Kong T: +852 2249 3100	F: +61 8 8236 2305 E: www.investorcentre.com/ contact	If you would like to provide any feedback on the Investor Insight newsletter, please email us at info-au @goodman.com.
	F: +852 2525 2070	www .computershare.com
	E: info-au@goodman.com
	www .goodman.com

This document contains certain forward-looking statements, expectations, estimates and projections (“forward-looking statements”) which involve known and unknown risks, uncertainties and other factors that may cause actual results and outcomes to differ materially from those expressed or implied in such statements. Due care and attention has been used in the preparation of, or sourcing from third parties, such forward-looking 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 and there can be no assurance that actual outcomes will not differ materially from these forward-looking statements. The information on 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 155911149 – 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 the Goodman Group Financial Report for the year ended 30 June 2016 and 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. July 2017

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