GMT Annual Meeting of Unitholders | New Zealand
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GMT Annual Meeting of Unitholders

Wednesday, 7 July 2021


Good afternoon ladies and gentlemen and welcome to this annual meeting of Unitholders. I’m Keith Smith, Independent Director and Chair of Goodman (NZ) Limited, the Manager of Goodman Property Trust. 

It’s pleasing to be hosting a physical meeting again after the disruption to public gatherings last year. Adopting a hybrid format for this event allows us to engage with all our investors, either in person or via a live webcast. The technology also allows our two Australian-based directors to participate in the Meeting while trans-Tasman travel is restricted. 

Today’s presentations will focus on the strong operating performance of the Trust, new sustainability commitments and our strategy for future growth. The meeting will also consider three ordinary resolutions relating to the re-appointment of Independent Directors.

Before we proceed, I would like to cover off some health and safety matters relating to the use of this venue. 

In the unlikely event of an emergency you will be required to evacuate and assemble outside in a designated safe area. Should this occur please exit the room through the rear doors and follow the directions of Eden Park staff. The bathrooms are also located through these rear doors, in the foyer of this meeting room. 

A key difference between a virtual meeting and a physical one is in the way voting is conducted and how questions are dealt with.


For Unitholders participating through the live webcast, polling on the three resolutions has now opened. Votes can be cast by selecting the polling icon on the instruction screen and following the prompts. Votes can be amended up until the time the poll closes, which is at the conclusion of the meeting. 

Now the meeting has started, questions can also be submitted through the webcast portal. We have allocated time at the end of the presentations to answer these, but they can be submitted at any stage.  

If you experience any technical issues casting your vote or submitting questions, please refer to the instructions provided in the Virtual Annual Meeting Guide that accompanied the Notice of Meeting. 


I would now like to introduce the members of the Board and executives of the Manager who are in attendance today. In addition to myself we have David Gibson, Laurissa Cooney, Andy Eakin and John Dakin. Leonie Freeman, Greg Goodman and Phil Pryke join us online. 

We have progressed our Board renewal programme since the last meeting and I’m pleased to welcome Laurissa and David as new Independent Directors. Their appointments follow the retirement of Peter Simmonds and Susan Paterson, after more than 10 years of valued service.

Laurissa and David are both experienced and capable Directors who will continue the strong governance and oversight that has characterised the growth of GMT. They will speak later in the meeting, outlining their professional achievements and areas of interest and expertise.


In addition to the directors and executives present today, we also have representatives of the Trustee and other advisors present. These representatives will be available to answer any questions if required.


I’d now like to work through some of the formalities of an annual meeting. 

I’d like it noted that, in accordance with the Trust Deed, I have been nominated by the Trustee to act as Chair of this meeting and I have now tabled this nomination.
I also confirm that the meeting has been properly convened and notice has been formally given to Unitholders. 

And finally, I can confirm that we have satisfied the requirements for a quorum. Now the formalities have been addressed we can proceed.


It has been a challenging 12 months since we last met, with the rapid spread of COVID-19 disrupting lives and economies all around the world. I’m pleased to note that New Zealand has avoided the worst of these impacts and that GMT has continued to deliver strong results for investors and other stakeholders. 

The Board has been extremely pleased with the performance of the Trust and this year’s statutory profit of almost $650 million before tax is a record for GMT. 

While the pandemic has brought some challenges, it has also accelerated structural changes that are positive for our business. Advances in technology and changes in consumer behaviour are contributing to a growing digital economy. 

An investment strategy focused on the urban logistics segment of the Auckland industrial market has positioned GMT to benefit from these trends. The continued growth of the city and the rapid expansion of online retailing is adding to the strong demand for well-located distribution space close to consumers.

These positive market dynamics are reflected in the Trust’s operating results. Unitholders familiar with our reporting will know that cash earnings are our preferred measure of underlying operating performance. The Trust recorded a 2.9% increase in cash earnings this year to 6.4 cents per unit, and paid cash distributions of 5.3 cents per unit. The lower level of distribution is consistent with a revised distribution policy that now includes a target payout ratio of between 80% and 90% of cash earnings. 

With the risks of COVID-19 in New Zealand being contained, the operating outlook has improved markedly from this time last year.  Our guidance for FY22 reflects the improvement in business confidence, with a forecast increase in cash distributions to at least 5.5 cents per unit. 



The forecast distribution equates to a cash yield of 2.3% at the current trading price of around $2.40 per unit. The metric is the strongest in the sector, reflecting the appeal of our investment strategy to investors.  It’s a broad group that includes a growing proportion of offshore funds.  Collectively these investors now own around 20% of the Trust, up from 13% two years ago.  

The relative strength of GMT’s stock price through the period of market volatility associated with the early stages of the pandemic partly reflects the greater diversity and liquidity within the register. 

The Trust has significantly outperformed the listed property sector on a total return basis over the past two years. The quantum of the outperformance in FY20 created a carry forward amount that resulted in Goodman, as Manager of the Trust, earning a performance fee this year of $13.7 million.

The relative performance measure means a performance fee is only earned when GMT out-performs its listed property peer-group and provides positive total returns to investors.

The Trust Deed requires that this fee is used to subscribe for new units in GMT. Given Goodman’s substantial cornerstone investment in the Trust, the requirement reinforces an already strong alignment of interests between Goodman and other Unitholders. 


The Trust’s sustainability programme is an area in which we have made significant progress over the last 12 months. A sustainable investment strategy leads to positive economic, environmental, and social outcomes for our business, our stakeholders and the world more broadly.

Addressing the impacts of climate change is a key focus and we have achieved a significant milestone this year, becoming a Toitū carbonZero certified business. Independent assurance from Toitū Envirocare confirms our greenhouse gas emissions have been measured in accordance with international standards and that we have offset unavoidable emissions with the purchase of certified New Zealand carbon credits. 

Implementing an emissions reduction plan and becoming Toitū certified means our operations are now proudly carbon neutral, four years ahead of our 2025 target date.
We have also widened the scope of the sustainability programme to include the Trust’s development activity. This commitment includes the targeting of a five-star, Green Star certification for all new development projects. Green Star is the New Zealand benchmark for sustainable industrial buildings and achieving this standard will ensure all new buildings developed by the Trust will be industry leading. 

We will also be offsetting the embodied carbon within new projects. The impacts of steel, concrete and other materials in the construction process are some of the largest contributors to greenhouse gas emissions.  John will talk later in the presentation about how we are reducing the carbon footprint of our new developments in a case study of Roma Road.

Financial stability is a prerequisite for a sustainable business and GMT has always been managed prudently to ensure it has a strong balance sheet with diverse sources of funding. Asset sales and equity issuance in previous years have provided the substantial reserves that have allowed the Trust to progress its development programme and secure new investment opportunities.

The Board has continued its disciplined approach by extending the successful bond programme and reducing its preferred gearing range for the Trust to between 20% and 30%.

These measures, together with refinements to the distribution policy, have continued to support the creation of a high-quality, low risk property business focused on sustainable long-term growth. 

I’d now like to pass over to Andy Eakin, who will give a more detailed overview of the Trust’s recent financial results. 


Thank you, Keith, and good afternoon to everyone. It’s been another successful year for GMT, despite the ongoing disruption of a global pandemic.


We have responded to the various challenges of COVID-19 while continuing to prioritise the health and wellbeing of our staff, customers, and contractors. New safety protocols and the provision of personal protective equipment have kept our people and worksites safe while agile work practices have enabled our team to work remotely when required. 

Our flexible work policy has provided every employee with a significant financial contribution toward a home office setup. This has enabled a more permanent shift with all our staff now working remotely at least one day a week. Greater flexibility in our work practices is expected to help us achieve a more diverse workforce in time.

An essential business classification has enabled the Trust to operate almost uninterrupted throughout the various Alert Level restrictions, supporting the continued operation of critical supply chains. While most of our customers have adapted to the new operating environment, a small number, typically retail and hospitality businesses, have experienced significant hardship.  

As a long-term business partner, the Trust has supported these more vulnerable customers with assistance including rent abatements, rent deferrals, rent freezes, lease restructures and marketing support. While the cost of this support to the Trust is perhaps not material in the context of its total rental income of $168 million, its value to these businesses has been hugely significant.



Auckland’s urban logistics market has continued to be the best performing of all the commercial property sectors. The unique demand drivers in our preferred property class are being reflected in high occupancy levels, positive leasing results and a greater level of development activity for the Trust. 

These factors, together with new acquisitions have contributed to an increase in net rental income this year to $153 million.  The additional revenue has driven a corresponding increase in operating earnings, which have grown 4.7% to almost $115 million before tax, reducing to $95.4 million after-tax. 

A lower effective tax rate of 17% reflects the reinstatement of building depreciation deductions for commercial property investors. The Trust’s PIE status mean these deductions are passed through to Unitholders, the majority of whom have no further tax to pay on the distributions they receive. It’s a positive feature of the PIE regime that means investors are effectively getting the same deductions as if they were investing directly in industrial property themselves.

A substantial portfolio revaluation is the main reconciling item between the Trust’s operating result and its statutory profit of $631.7 million after tax. The 17.3% increase in the value of the portfolio, to almost $3.8 billion, contributed $560 million of fair value gains to this year’s record profit. It also underpinned the 23% increase in net tangible asset backing to $2.12 per unit at 31 March 2021. With a current stock price of around $2.40 per unit, GMT is currently trading at an 12.9% premium to its asset backing. 

The significant rise in property values has occurred as the New Zealand economy rapidly recovered from the initial COVID-19 lockdowns, driven by record low interest rates and positive investor and customer demand for high-quality warehouse and logistics space across Auckland. The attraction of the Trust’s assets is reflected in the strengthening of the portfolio capitalisation rate which has firmed 70 bps over the last 12 months to an average of 4.7%.

Recent sales data suggests values have continued to increase after the portfolio valuation was completed in March.


A well-capitalised balance sheet has enabled GMT to progress its development programme and take advantage of new acquisition opportunities during the year. With a loan to value ratio of just 19.2% and only partially drawn debt facilities at 31 March 2021, the Trust retains over $300 million of funding capacity for future investment.

It’s a strong position that has been maintained through careful financial management and disciplined execution of the Trust’s investment strategy. 

Having a diverse capital structure that includes a variety of funding sources has added to GMT’s financial resilience. The issue of $200 million of fixed rate bonds to New Zealand wholesale investors in September 2020 contributed to this prudent approach. The new bonds improve both the tenor and diversity of the Trust’s debt book which now includes bank borrowings, listed retail bonds, wholesale bonds and US Private Placement notes. 

Managing the expiry profile of the facilities with the Trust’s debt book is a function of our treasury programme. With an average term to expiry of around five years, the first maturity occurs in June 2022. 

While we have the capacity to repay the $100 million GMB030 bonds from bank debt, further non-bank debt is the preferred refinancing option at this stage. It will help retain liquidity within our bank facilities, providing the Trust with continued strong operational flexibility. 

Any new debt is expected to share the same security as the Trust’s existing debt which is rated BBB+, one notch higher than the investment grade credit rating of BBB assigned to the Trust by S&P Global Ratings. 

Both ratings have remained unchanged since first assigned in 2009, reinforcing the strong and stable nature of our businesses.

While COVID-19 has tested the resilience of many companies over the last year, the consistent operating performance of Trust has demonstrated its ability to withstand market disruptions. 

By continuing to act prudently and directing new investment to the most compelling opportunities it will remain a well-capitalised and robust business. I’ll now hand over to John who will continue with the operational review.


Thanks Andy, and good afternoon to everyone here at Eden Park and to those of you participating through the live webcast.

This afternoon I want to explain a bit more about our investment strategy and how a growing online marketplace is positive for our business. I’ll also review our development programme, profiling the exciting new projects we are commencing at our Favona and Roma Road estates. 


Investing in the urban logistics segment of the Auckland industrial market has continued to be a successful strategy for the Trust. As New Zealand’s largest city, Auckland is the gateway to the country, its commercial centre and its largest consumer market. It is also growing at a rapid rate with its population forecast to reach two million within the next 10 to 12 years.

The strength of the regional economy and a growing online marketplace are adding to the demand for well-located warehouse and logistics space. This is exactly the type of property we are investing in. It fulfils a vital role in the supply chain, ensuring goods are stored efficiently and can be easily distributed to meet demand. 

The next slide shows an aerial image of Auckland. The density of the metropolitan area and its geographic constraints are clear. Overlaid on the map are our 11 estates. You’ll note the location of these properties relative to key freight and transport infrastructure. Each estate provides customers with specific locational advantages including direct motorway access, proximity to air transport and port facilities and even dedicated rail sidings. 

At 31 March 2021, the portfolio had a value of $3.8 billion, with more than one million square metres of rentable area leased to over 210 customers. These companies provide the strong rental cashflows that underpin the Trust’s operating results. Proximity to consumers is an increasingly important factor in the property decisions of our customers. It simplifies distribution and creates efficiencies that leverage the growth in e-commerce.

Every one of the Trust’s estates is central to Auckland’s large population. New Zealand consumers have embraced the convenience and safety of online shopping, making around $5.8 billion of purchases last year. It represents around 11% of the country’s total retail sales, an increase of 25% from a year earlier. The increasing penetration of e-commerce follows trends in markets such as the UK, US and China where online shopping can make up more than 20% of all retail sales. 

The emerging nature of e-commerce in New Zealand, relative to these offshore markets, means we expect online retailing to continue being an important demand driver for urban logistics space.


The strength of current customer demand is reflected in the historically low vacancy rate for prime industrial space across Auckland. At just 1.2%, it’s well below the long-term average. Space within our own portfolio is similarly constrained, with an average occupancy rate of 99% during the year. 

It’s positive for our development workbook, where we’ve continued to make outstanding progress.

We completed seven projects during the year. Images of these customer expansions and new build-to-lease facilities are shown on screen now. With a combined area of over 33,900 sqm the new facilities are 86% leased and have a weighted average lease term of almost eight years. Developments also contributed $23.5 million of fair value gains to this year’s profit result.

The development workbook includes a further $250 million of work in progress. It’s a heightened level of activity that reflects the structural changes that are specific to the warehousing and logistics sector. COVID-19 has accelerated these trends and enquiry levels show that companies are once again making decisions about their future space requirements. 

The most significant of our new projects are the redevelopments of Favona Road and Roma Road Estates. These strategically located properties were acquired in recent years for their development potential.

The rapid growth in demand for urban logistics space has brought forward our redevelopment plans. The two projects are commencing with significant customer pre-commitments from Mainfreight and New Zealand Post. Both these leading companies are existing customers, occupying multiple facilities within the portfolio.  

Favona Road Estate in Mangere has a site area of seven hectares. The former market garden and coolstore is to be redeveloped into two logistics facilities totalling around 33,000 sqm. Mainfreight has committed to the larger 22,435 sqm facility with the second warehouse being developed on a build-to lease basis.

Roma Road Estate is a larger property with a site area of 13-hectares. The location at the northern end of SH20 alongside the Waterview Tunnel in Mt Roskill offers direct access to Auckland’s motorway network. Close to the CBD, port and airport the site is being transformed into an inner-city logistics hub for Auckland. 

The masterplan includes four facilities providing over 42,000 sqm of high-quality distribution space. These facilities will be complemented by extensive onsite amenity that links with the neighbouring cycle path and Stoddard Road commercial precinct. Construction will be staged to meet demand with the estate expected to have a value of more than $200 million once fully developed.

New Zealand Post will anchor the redevelopment, committing to a 20-year lease over a new 17,700 sqm property solution. The new facility is part of a wider business strategy for NZ Post to accommodate the rapid growth in its delivery services. Last year alone, the organisation delivered over 85 million parcels. Expectations are that these volumes will continue to grow in line with online shopping trends.

Meeting the needs of our customers with sustainable property solutions is positive for all our stakeholders and we’re working collaboratively with NZ Post to maximise the operational performance and energy efficiency of its new design-build facility. It will be developed using sustainably-sourced building materials, with the construction process carefully managed to reduce waste and other environmental impacts.  Rainwater harvesting and solar energy initiatives are also planned to take advantage of the extensive roof area. 

As Keith noted earlier, we are targeting a five-star Green Star rating for all our new developments. Green Star is an environmental rating system for buildings that uses a broad set of criteria to assess quality. A five-star rating reflects New Zealand excellence, a standard that we are targeting for every new project. 

It’s a market leading commitment that is matched by an undertaking to offset the embodied carbon within all our new projects. Mitigating these emissions means we are minimising the impact of our commercial activities and protecting the natural environment to the extent we can. 


With around 80% of the portfolio built since 2004, GMT’s development capability has been a major factor in the success of the business. Maintaining a development pipeline is essential if the Trust is to meet the growing property requirements of customers like Mainfreight and NZ Post. 

The acquisition of properties neighbouring the Trust’s Savill Link and Mt Wellington industrial estates during the year will add to the current pipeline. With a combined purchase price of $83 million, these properties have a total site area of 14.5 hectares.
You’ll see the strategic importance of these sites and the additional value they add to our existing estates in the following aerial images. 

Fully leased, with existing improvements providing holding income, the new sites offer a range of longer-term redevelopment options that will contribute to GMT’s future growth.



While it’s pleasing to be reviewing such a strong operating performance from the Trust, we have also been mindful of those who have had a more difficult year. The Goodman Foundation is a charitable initiative of the Manager that recognises the responsibility we share with the communities where we invest. To help address the disproportionate impacts of the pandemic, the Goodman Foundation has increased its support this year, with more than $500,000 being distributed to help the vulnerable, particularly those facing food insecurity issues. 

Some of you may be familiar with the work of KiwiHarvest and the New Zealand Food Network. These two organisations are focused on food rescue, collecting, and redistributing surplus or perishable food destined for landfill. With its main facility at the Trust’s Highbrook Business Park, KiwiHarvest rescued 2.1 million kilograms of food last year. Equivalent to over six million meals, it included surplus produce, mislabelled goods and grocery items approaching expiry. 

With demand for food parcels from social agencies greater than ever, the Foundation also supported the establishment of the New Zealand Food Network, in conjunction with the Ministry of Social Development. Located alongside KiwiHarvest at Highbrook this organisation is facilitating the efficient delivery of large volumes of surplus food through a national distribution network. In the first nine months of operation, over two million kilograms of food has been distributed to foodbanks, food rescue and community food services. Our recent annual report includes more detail on the work of the Goodman Foundation if you’d like to learn more. 



Before I hand back to Keith for questions, I’d just like to reiterate some of the key points from today’s presentations. 

GMT’s strong operating performance and record financial results have shown that it is a resilient business that can withstand market disruptions. While the pandemic has brought some challenges, it has also accelerated structural trends that are driving demand for distribution facilities close to consumers. A high-quality portfolio focused on urban logistics means that GMT is benefitting from the continued growth of Auckland and the rapid expansion of online retailing. These factors are being reflected in positive leasing results and a renewed level of development activity. 

New sustainability initiatives are also enhancing our business and reducing our environmental impact. Delivering sustainable returns to investors and high-quality, carbon neutral property solutions to customers is positive for all our stakeholders. We are doing more for our local communities too, through the social initiatives of the Goodman Foundation. 

While economic risks remain, the quality and scale of the portfolio, together with low gearing and focused investment strategy, give us confidence about the year ahead.
Thank you everyone.


Thanks John. On behalf of the Board, I want to thank our customers and investors for their continued support. I would also like to acknowledge the contribution of the entire Goodman team to this year’s outstanding result. Thank you all for your efforts. That concludes the presentations ladies and gentlemen, we’ll now move on to the formal business of the meeting.


For those of you participating through the live webcast, I encourage you to submit any questions you’d like addressed now. As I mentioned earlier, these need to be entered through the webcast portal. To do so, please click on the speech bubble icon at the top of the instruction screen and follow the prompts.
I’ll now move onto questions, starting with those in the room. 

[Keith to address any questions in the room]

We’ll now move onto questions from our webcast participants.

[Keith to address any online questions]

Ladies and gentlemen, as there are no further questions I will now proceed to the formal business of the meeting.


The composition of the Board is carefully managed to ensure it includes a diverse group of Directors with the required range of skills, knowledge and experience to effectively manage GMT. As I mentioned in 2019, we are working through a deliberate Board renewal programme that will continue over the next few years. Future changes will be timed to ensure that a balanced Board, with the appropriate mix of skills and experience, is always maintained. 

The Trust has a contemporary structure and Unitholders have the right to nominate and vote on the Independent Directors of the Manager. 

Laurissa Cooney, David Gibson and Leonie Freeman are retiring in accordance with the constitution of the Manager and the NZX Listing Rules, and being eligible, have offered themselves for re-election. All three are capable and valued members of the Board, and the other Directors and I unanimously recommend that Unitholders vote in favour of their re-appointment.

Following the call for nominations, none were received and therefore they stand unopposed.
Before we conduct the poll, I will invite each Director to address the meeting. 

[Laurissa to briefly address the Meeting]
[David to briefly address the Meeting]
[Leonie to briefly address the Meeting]

Thank you, Leonie. 

As I mentioned earlier Laurissa and David are recent appointments to the Board, selected for the complementary skills and oversight they bring as Independent Directors. 

We’ll now move on to the poll.

The three Resolutions are set out in the Notice of Meeting and on the voting form you will have received. As they have been notified, there is no requirement for a seconder. 
A majority of not less than half of persons entitled to vote, and voting, is required to carry each resolution. 

Are there any questions on the three resolutions?

[Keith to address any questions on the resolutions either from the audience or online]

As there are no further questions, we will undertake the poll and formally conclude this meeting. 

For those participating through the live webcast that have not already voted, please submit your vote now. The poll will be closing in just a few minutes.
For those of you in the room that have not already voted, please complete your voting and proxy form and place it in the boxes at the rear of the room. There are pens available and Computershare staff will be on hand should you require replacement forms or have any questions. 

Ladies and gentlemen, thank you very much for your participation this afternoon. The result of the poll will be announced to the NZX in due course and a copy of the announcement will also be available on our website. 

I now declare this meeting closed. 

For further information please contact: 

John Dakin 
Chief Executive Officer and Executive Director
(021) 321 541 

Andy Eakin 
Chief Financial Officer 
(021) 305 316 

Keith Smith
(021) 920 659