Goodman grabs $2.2 billion in new projects

Goodman Group (ASX: GMG) released an operational update (link saves as PDF) today outlining its progress for the nine months ended 31 March. The property group has seen a significant boost from the growth of e-commerce, pushing its current workbook to $2.2 billion.

“Overall development demand has been strong in all of our markets, particularly in Australia where we have secured a number of large pre-commitments, increasing our development work book to $970 million,” said CEO Greg Goodman in a statement today. “In China, demand continues to run ahead of supply, while in Europe, activity reflects the high customer demand which has been led by e-commerce retailers and the automotive sector. As a result, this provides us with good visibility into our development volumes and growth well into FY2014.”


Source: Goodman Operational Update Presentation

The company has maintained occupancy rates at 96%, and 1.9 million square metres of leased space will pull in around $186 million of rental income annually. As a sign of financial stability during volatile times, Goodman has also managed to pre-commit 71% of projects, and pre-sell 78%.

Looking ahead, the property group will continue to work its way through its 70 current projects, with an average forecast yield on cost of 8.8%. Second-half FY 2013 earnings are expected to mirror the first half’s 16.2 cents, essentially matching previous estimates for full year-earnings of 32.3 cents. Mr. Goodman noted that his company’s diverse global platform, along with continued demand for high quality industrial space, will keep Goodman in a competitive position.

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Motley Fool contributor Justin Loiseau has no position in any stocks mentioned in this article. You can follow him on Twitter @TMFJLo.

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