The value of Goodman’s investment portfolio was $6.7 billion at 30 June 2015, which compares with $5.6 billion for the same period last year and consists of the Group’s ownership interest in 411 prime industrial and business space properties across 16 countries. The composition of the portfolio reflects the Group’s direct property investments valued at $2.7 billion and is represented by 31 properties located in key markets across Australia, the United Kingdom (UK) and Europe. Furthermore, the investment portfolio includes $4.0 billion of the Group’s cornerstone investments in its managed partnerships and other financial investments.
Growth in our total assets under management was the key driver in the higher value of the overall investment portfolio. This was mainly as a result of development completions and positive revaluations, across both our direct property investments and the Group’s proportionate share of its cornerstone investments in its managed partnerships. A significant feature of our direct property investments is the number of sites that have been included as part of the Group’s urban renewal strategy, which provides a substantial opportunity to return capital to the Group over the long term. The growth of the investment portfolio was offset by a number of asset rotation initiatives undertaken during the year, which included the disposal of the majority of the Group’s UK property assets and selective asset sales across our managed partnerships, predominantly in Australia and New Zealand, in addition to the UK.
Interchange Park, Sydney, Australia.
The performance of the Group’s overall investment portfolio over the 12 month period reflected the robust property fundamentals and solid operating activity experienced during the year. Our customer focused offering, size and scale of our quality portfolio, active asset management and diverse global operating platform are key components of Goodman’s business. They provide Goodman with the capability to meet the unique needs of our customers, while benefiting from the ongoing global demand for quality industrial property and business space. This saw Goodman lease 3.4 million sqm of space, equating to $386 million of net property income, with occupancy maintained at a high 96% and like-for-like rental growth of 2.5%.
As an active asset manager, Goodman continually assesses opportunities to add value across its portfolio. This includes seeking opportunities to reposition assets to enhance performance, such as through higher and better use outcomes or rotating assets where, for example, value has been maximised. During the year, Goodman focused on improving the quality of its properties and income, taking advantage of higher asset pricing to selectively sell assets across the Group and its managed partnerships. This achieved $1.9 billion in sale proceeds, with the capital being reinvested to provide funding for Goodman’s high quality development work book.
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