In an ASX update on Wednesday, Australia’s largest industrial property group said the funds would primarily be used for data centre growth opportunities, which now account for 46 per cent of its $13 billion development pipeline.
The company’s 5 GW power bank spans 13 major global cities – primarily in metro locations – to support cloud and artificial intelligence deployments. By June 2026, Goodman expects to have commenced the development of new powered shells and fully fitted facilities, adding approximately 0.5 GW of capacity.
CEO Greg Goodman, in conjunction with the release of the company’s half-year financial update, expressed confidence in Goodman’s ability to meet the growing need for data centres globally.
“The additional funds raised provide us with greater financial and operational flexibility to manage the next phase of growth,” he said.
“Goodman’s strategy of providing essential infrastructure for the digital economy – both through our logistics facilities and data centres – has set a strong foundation for the growth we expect to see by executing the global data centre opportunity before us.”
Goodman Group is accelerating its data centre expansion as demand surges due to increasing cloud adoption, data migration and the rise of AI and machine learning.
During the half-year, the company advanced its data centre strategy by enhancing customer solutions, launching new projects, establishing a dedicated data centre capital partnership and strengthening its specialist global data centre team.
Goodman’s total portfolio has grown 7 per cent to $84.4 billion, with the majority managed through its extensive funds management platform.
In its performance update on Wednesday, the company said its operating profit increased 8 per cent to $1.2 billion, while its statutory profit stood at $799.8 million.
Morningstar, in a market note last month, acknowledged that Goodman’s development-led strategy has tripled its pipeline over the past decade and expects further expansion, particularly through large-scale, high-value projects like data centres.
However, the research firm cautioned that while current projects remain highly lucrative, future development revenue growth and margins may soften.
“This is because suitable locations for data centres are limited and will get harder to obtain as other REITs and data centre operators are also eyeing the same space,” Morningstar said.
It also raised doubts about the sustainability of the data centre boom, citing the emergence of DeepSeek, which has sparked questions about the massive investment in AI infrastructure and whether such spending is truly justifiable.
“Narrow-moat Goodman has significant exposure to this theme due to its data centre developments,” the firm said.
While maintaining its fair value estimate for Goodman at AU$27 per security, Morningstar noted that less than a fifth of its valuation is attributed to the company’s data centre business.
“While the security still screens as overvalued, the DeepSeek launch sends a reminder of the dangers of high expectations with respect to a listed entity’s exposure to the fast-developing AI industry,” it said.
“We think there are significant risks to Goodman earning above its cost of capital over the long term, given data centres are capital-intensive and new supply is rapidly entering the market.”
