Goodman : Q3 Operational Update

Goodman Group (Goodman or Group) has delivered a strong performance across all divisions in the nine months to March 2018.

The increasing demand for prime industrial space across the Group's global portfolio continues to be driven by the impact of rising urban populations and technological changes, which are in turn driving the growth of e-commerce around the world.

"Technology-driven change in global markets is increasing demand for warehouses and industrial real estate in urban centres. We're seeing simultaneous improvement in mobile and supply chain technology, aiding fulfilment and combining to facilitate the ongoing growth of e-commerce over the long term.

Our customers are adopting automation and robotics which is improving the efficiency and speed of delivery to consumers. However, the continued strong growth of e-commerce, means that more facilities in urban areas are needed to support demand.

This demand for space in the right locations is providing support for our ongoing development workbook and property fundamentals on our stabilised portfolio."

- Greg Goodman, Group CEO

KEY HIGHLIGHTS for the nine months to 31 March 2018

• + $36.8 billion total assets under management located in core markets, (up 6.4% on 1HFY18)

• + 3.1% like for like NPI growth reflecting high-quality portfolio

• + 98% occupancy across the Group and Partnerships

• + $3.5 billion of development work in progress

• + $2.3 billion of development commencements with 70% undertaken in Partnerships

• + Reaffirm forecast FY2018 operating earnings per security of 46.5 cents, up 8% on FY2017

OWN

The portfolio is now concentrated in large urban centres, where barriers to entry are high, land is scarce and in some cases supply is negative. The repositioning is now delivering higher occupancy globally and improving rental growth, as customers from multiple industries compete for space close to consumers. The increased demand from e-commerce, data centre users and urban renewal continues to put pressure on land use and availability.

+ Underlying property fundamentals in the global portfolio remain strong

• - Leased 2.7 million sqm across the platform over the period equating to $323 million of annual net property income

• - Maintained occupancy at 98%

• - WALE of 4.7 years

• - Like for like NPI growth of 3.1%

+ Scarce supply of land leading to intensification of use

• - Long term driver of sustainable rental growth

• - Provides redevelopment opportunities.

Region

Leasing area (sqm)Net annual rent ($M)Average lease term (years)

Australia / New Zealand

856,254 1,015,555

122.0

4.7

Asia

136.1

3.1

UK / Continental Europe

850,813

64.9

4.3

Total

2,722,622

323.0

3.9

Total AUM by type

1. Leasing for investment properties only and excludes developments

DEVELOP

Demand from customers globally remains robust and we are seeing positive pressure on development rents in most markets. The Group's focus remains on delivering quality developments which is reflected in almost full occupancy on completion of projects over the past nine months and strong margins.

+

Development WIP of $3.5 billion across 73 projects with + a forecast yield on cost of 7.1%

+ Development commencements of $2.3 billion with 52% pre-committed and 70% developed for Partnerships or third parties

+

Development completions of $2.5 billion with 88% pre-committed and 86% developed for Partnerships or third parties.

Development WIP

Structural and cyclical themes continue to provide positive tailwinds with land acquisitions focused on heavily supply constrained markets

+ Continued capital partnering of development projects with 76% of WIP now undertaken within Partnerships

+

European markets of France and Germany remain key drivers from e-commerce users focusing on urban logistics facilities.

Work in progress as at 31 March 2018

Completions

Work in progress

Value ($b)

2.5

2.3

3.5

Area (m sqm) Yield (%) Pre-committed (%)

1.6

1.3

2.1

7.4

7.0

7.1

88

52

57

Weighted Average Lease Term (years) Development for Third Parties or Partnerships (%) Australia / New Zealand (%) of WIP

10.3

9.5

8.0

86

70

76

18

17

21

Asia (%) of WIP

11

17

33

Americas (%) of WIP Europe (%) of WIP

24

21

15

47

45

31

Work in progress by region

On balance sheet end value $mPartnerships end value $m

Australia / New Zealand Asia

88 655

104 1,044

Americas Europe Total

34 486

600 470

826

2,655

MANAGE

Total AUM increased to $36.8 billion in the quarter (up 6.4% on 1HFY18) mainly due to strong valuation growth, development completions and currency offsetting asset sales.

Strong customer demand in the global portfolio should continue to support income growth and cap rate compression, sustaining strong returns and consequently management revenue growth.

+ External AUM of $33.3 billion (up 7% on 1H18) driven by

• - strong valuation gains

• - development completions and net acquisitions

• - exchange rates.

Total AUM

+ Strong performance of Partnerships to support ongoing performance fees

+

Continued strong demand from capital partners and investment market for logistics product.

Total AUM by geography

OUTLOOK

Structural demand drivers continue

Consumption, driven by growing wealth, technology and urbanisation, is providing a strong tailwind for revenue growth and therefore our customers demand for well-located industrial properties. Goodman is in a strong position to benefit from these structural trends given:

• + The Group's portfolio is concentrated in key infill markets, where land is scarce. This has supported improved rental growth in most markets as customers compete for space

• + Competition for property close to consumers from different users, is providing opportunities for the Group to capitalise on more intensive land utilisation

• + AUM is expected to continue to increase as strong fundamentals drive new developments, occupancy, rents, cap rates and ultimately valuations.

Our portfolio, balance sheet and business operations are designed to benefit from the long-term growth expected from this environment, while being resilient to future structural changes. The Group is in a strong position for FY18 and reaffirms its forecast FY2018 operating earnings per security of 46.5 cents, up 8% on FY2017.

ABOUT GOODMAN

Goodman Group is an integrated property group with operations throughout Australia, New Zealand, Asia, Europe, the United Kingdom, North America and Brazil. Goodman Group, comprised of the stapled entities Goodman Limited, Goodman Industrial Trust and Goodman Logistics (HK) Limited, is the largest industrial property group listed on the Australian Securities Exchange and one of the largest listed specialist investment managers of industrial property and business space globally.

Goodman's global property expertise, integrated own+develop+manage customer service offering and significant investment management platform ensures it creates innovative property solutions that meet the individual requirements of its customers, while seeking to deliver long-term returns for investors.

CONTACT

Media

Michelle Chaperon

Head of Group Corporate Communications + 612 9230 7400

Investors James Inwood

Head of Group Stakeholder Relations +612 9230 7400

For more information:www.goodman.com

+

This document has been prepared by Goodman Group (Goodman Limited (ABN 69 000 123 071), Goodman Funds Management Limited (ABN 48 067 796 641; AFSL Number 223621) as the Responsible Entity for Goodman Industrial Trust (ARSN 091 213 839) and Goodman Logistics (HK) Limited (Company Number 1700359; ARBN 155911142 - A Hong Kong company with limited liability). This document is a presentation of general background information about the Group's activities current at the date of the presentation. It is information in a summary form and does not purport to be complete. It is to be read in conjunction with the Goodman Group Interim Financial Report for the half year ended 31 December 2017, the Financial Report for the year ended 30 June 2017 and Goodman Group's other announcements released to ASX (available atwww.asx.com.au). It is not intended to be relied upon as advice to investors or potential investors and does not take into account the investment objectives, financial situation or needs of any particular investor. These should be considered, with professional advice, when deciding if an investment is appropriate.

+

This Presentation uses operating profit and operating EPS to present a clear view of the underlying profit from operations. Operating profit comprises profit attributable to Securityholders adjusted for profit on disposal of investment properties, net property valuations gains, non-property impairment losses, net gains/losses from the fair value movements on derivative financial instruments and unrealised fair value and foreign exchange movements on interest bearing liabilities and other non-cash adjustments or non-recurring items e.g. the share based payments expense associated with Goodman's Long Term Incentive Plan (LTIP). The calculation of fair value requires estimates and assumptions which are continually evaluated and are based on historical experience and expectations of future events that are believed to be reasonable in the circumstances.

+

This document contains certain "forward-looking statements". The words "anticipate", "believe", "expect", "project", "forecast", "estimate", "likely", "intend", "should", "could", "may", "target", "plan" and other similar expressions are intended to identify forward-looking statements. Indications of, and guidance on, future earnings and financial position and performance are also forward-looking statements. Due care and attention has been used in the preparation of forecast information. Such forward-looking statements are not guarantees of future performance and involve known and unknown risks, uncertainties and other factors, many of which are beyond the control of the Group, that may cause actual results to differ materially from those expressed or implied in such statements. There can be no assurance that actual outcomes will not differ materially from these statements. Neither the Group, nor any other person, gives any representation, warranty, assurance or guarantee that the occurrence of the events expressed or implied in any forward looking-statements in this document will actually occur.

5