Macquarie Goodman set for U.S. expansion

MELBOURNE Fri May 25, 2007 7:08am EDT

MELBOURNE (Reuters) - Australia's Macquarie Goodman Ltd. MGQ.AX, the world's second-biggest industrial property trust, is set to move into the United States in the next stage of its global expansion as asset prices there start to flatten out.

The group, which buys land and develops industrial properties that it places into funds which it manages, has spent A$5 billion over the past 18 months building up its European and Asian platforms, and expects to have a U.S. presence within two years.

"The U.S. is a very, very major market and a great opportunity for us. We don't have a timeframe, but over the next 18 months to two years we'd be very disappointed if we didn't have a platform and a significant one (there)," Chief Executive Greg Goodman told Reuters in an interview.

"If things remain as expensive as they are now, it's probably going to be more difficult but I don't think they will, I think things will flatten out a bit as to asset values."

Macquarie Goodman, whose major rival is U.S. group ProLogis (PLD.N), expanded into Europe five years ago and has had a presence in Asia for two years, but has been deterred from entering the U.S. largely because of high asset prices.

The move into the U.S. would likely be through a partnership with an existing American real estate or development company. Goodman said the group was currently monitoring three or four situations in the country.

"It wouldn't be a passive investment, it would be a very active development funds management model for us," he said.

Macquarie Goodman has seen big growth in Europe and Asia and has locked in enough growth to meet its three- to four-year targets, so any move into the U.S. would be a bonus, Goodman said.

The company's share price has jumped more than 40 percent in the 12 months to May 25, compared to a 27 percent rise in the property index.

Macquarie Bank sold its 7 percent shareholding last year leaving the Goodman family, New Zealand's second wealthiest family, with an 8.77 percent stake. The company plans to change its name.

Goodman also said the group's planned UK logistics fund -- expected to launch within a year -- will have about 500 million pounds ($992.6 million) in funds. That is expected to increase to between 2 and 3 billion pounds in the short to medium term.

Its European logistics fund has 400 million euros ($537.16 million) and a development pipeline for another 400 million euros.

In total the company has A$3-3.5 billion in development projects and holds enough land for another A$4.5-6 billion of developments.

Its management portfolio holds more than US$18.9 billion in assets, including 40 percent of Ascendas Real Estate Investment Trust, one of Singapore's biggest property trusts.

Macquarie Goodman was formed from the 2000 merger of Macquarie Industrial Trust and the Goodman Hardie Industrial Trust.

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