Goodman Group, a leader in industrial property, is looking to harness the rapid advancements in artificial intelligence and robotics to achieve its projected double-digit growth by building state-of-the-art, large-scale data centers.
With a goal of securing 5 gigawatts of power, this global frontrunner is evolving into an infrastructure powerhouse, establishing data centers in key cities around the world.
During the group’s annual financial results presentation on Thursday, co-founder and CEO Greg Goodman emphasized that this marks a new era for the $65 billion company, which first listed on the ASX in 1995 with only eight properties in Sydney and a market value of $37 million. Today, the firm boasts 436 properties across 14 countries, valued at a combined $78.7 billion.
Analyst Lou Pirenc from Jarden pointed out that Goodman’s emphasis on infrastructure positions the company strongly for future growth. In a research note to clients, he highlighted that the global demand for AI, data, and energy pricing trends should bode well for Goodman over the next five to ten years.
For the fiscal year ending June 30, Goodman achieved an operating profit of $2.04 billion, representing a 15 percent rise from the year before. Despite this, the company reported a statutory loss of $98.9 million attributed to several one-off expenses.
Looking forward, Goodman anticipates its operating earnings for 2024–25 will hit 117.2¢ per security, which would mark a 9 percent increase from the prior year, while it plans to keep its annual distribution steady at 30¢ per security.
Greg Goodman expressed that the company is set to undergo a substantial transformation over the next five years, emphasizing the development of data centers and the influence of advancements in robotics and AI in the coming decade.
Currently, data centers represent the fastest-growing sector in commercial real estate, taking various forms, including large-scale vertical warehouses, which Goodman plans to establish in Australia. The company is building a modern, multi-story data center on the land where the old ABC headquarters used to be, located at 2-8 Lanceley Place and 14 Campbell Street in Sydney’s Artarmon.
The rise of these specialized climate-controlled centers has been driven by the increasing demand for data-intensive applications like e-commerce, the rollout of new technologies such as 5G, and the shift to remote working due to COVID-19. This sector represents a multibillion-dollar market, with space being quickly acquired by institutional investors, including superannuation funds.
Goodman emphasized that the rise of e-commerce, cloud computing, and the integration of technologies such as AI and machine learning is generating substantial opportunities for the company to develop the infrastructure its clients require.
The company is expanding its network of data centers around the world, focusing on transforming existing industrial properties into these more valuable facilities. They are targeting areas with high demand for cloud and AI services but limited supply, using land they already own or have access to.
Additionally, Goodman is improving their existing sites, like the large Oakdale complex in Sydney by adding electric vehicle charging stations, batteries, and solar panels.
