Goodman Group (“Goodman” or “Group”), a global owner, developer and manager of industrial real estate, has signed lease agreements representing approximately 950,000 sqm of logistics space in nine countries in Continental Europe during the first half of its 2016 fiscal year (FY2016), which ended 31 December . Additionally, the Group completed over 300,000 sqm of space and currently has over 720,000 sqm under construction, of which approximately 544,000 sqm commenced in the reporting period.
During the first half of FY2016,Goodman continued to capitalise on the strong demand for modern, high quality logistics space in prime locations. The principle drivers of growth were the ecommerce sector and customers seeking greater efficiencies within their supply chains, largely driven by retailers.
“In Continental Europe our focus has been on sustaining a high-level of pre-lease agreements for new developments and maintaining a high occupancy rate of 98% across the portfolio,” said Philippe Van der Beken, Goodman Managing Director for Continental Europe. “We have continued to build strong relationships with our customers with approximately half of all new development deals signed being with our existing customers, while the large majority of lease agreements for our stabilised portfolio were lease extensions.”
Strong development activity
As Europe’s top real estate developer (1), Goodman continues to experience high demand for new logistics space across its key markets. During the first half of its fiscal year, Goodman signed nearly 360,000 sqm of new development in France, Germany, the Netherlands, Poland and Slovakia.
Germany remains the biggest driver of growth for the Group in Continental Europe. Among the seven deals signed in Germany, Goodman was commissioned by leading fashion e-retailer Zalando to develop a 130,000 sqm facility in Lahr, Germany, which is one of the largest single customer real estate projects in Europe. The Group also signed a major deal with DS Smith, a leading international packaging business, for a 51,000 sqm facility near Frankfurt.
Across Continental Europe, third party logistics providers were among Goodman’s key customer groups for new developments. The most significant deal signed was in the Netherlands, with regional player Nabuurs for a 61,700 sqm European distribution centre. Across its European platform, Goodman is also developing for customers in the automotive, retail and manufacturing sectors.
(1) Ranking based on an independent annual survey and research undertaken by Property EU.
High customer retention rate
The quality of Goodman’s portfolio was illustrated by the signing of over 587,000 sqm of logistics space at its existing properties. The vast majority of this space was re-leased to Goodman’s current customers. The three largest leasing deals signed were in Germany: Cinram (73,000 sqm), Amazon (69,000 sqm) and Kuehne + Nagel (60,000 sqm). Across the portfolio, third party logistics providers accounted for over half of all lease agreements in the first half of the Group’s fiscal year.
In Continental Europe, Goodman maintains occupancy at 98% and customer retention of over 80%, demonstrating the benefit of Goodman’s active long-term property management approach.
Goodman completes 100,000 sqm for ecommerce sector, expands flagship projects
In the first half of FY2016, Goodman completed 100,000 sqm of new logistics space for the ecommerce sector, a 60,000 sqm facility for Home24 in Germany and a 40,000 sqm logistics centre for Cdiscount in France. Goodman is the leading owner, developer and manager of ecommerce logistics space in Europe, having delivered 1,437,000 sqm of space in recent years.
Additionally, the Group experienced continued growth at its flagship projects across Continental Europe. Goodman completed a new facility for Diehl Comfort Modules, an aerospace supplier, at Goodman Interlink Hamburg, which already counts Airbus as a customer. Goodman Pomeranian Logistics Centre, adjacent to the Gdansk Deepwater Container Terminal, added nearly 40,000 sqm. Goodman Senec Logistics Centre in Slovakia is steadily growing, with an additional 15,000
sqm of space completed and further expansion works currently underway.
Over 720,000 sqm under construction
Goodman currently has 720,000 sqm of logistics space under construction, of which 544,000 sqm commenced in the first half of the fiscal year. Some of the most significant projects include: Carrefour in France and Zalando and BMW in Germany, totalling approximately 345,000 sqm. Goodman is also developing over 180,000 sqm for third party logistics providers in France and Germany.
Other notable projects include the commercialisation of a €25 million port project at the Nuremburg Freight Village in Germany. Goodman is currently developing 42,000 sqm of logistics space for DB Schenker and STUTE, with the potential to construct an additional 30,000 sqm. In Belgium, the Group is constructing a 52,000 sqm turn-key development for Mobis, making this one of the country’s largest project of its kind. Finally, the 40,000 sqm facility being developed for Decathlon near Barcelona, Spain will be completed in the second half of 2016.