Mr Goodman said that rents are now sitting at $3700 per square metre due to the huge demand for storage and logistic assets, and this has helped to offset gains in prices for steel and construction.

Excluding one-off sales and $6 billion in valuation gains, Goodman reported an operating profit of $786.2 million, up 28 per cent on the first half, and operating earnings per security (EPS) of 41.9¢, up 27 per cent on the same period last year.

Goodman’s focus on building its funds management business has seen its total assets under management (AUM) rise 32 per cent to $68.2 billion.

It declared an interim distribution of 15¢, payable on February 24.

Goodman has an ASX market value of $44.8 billion and is one of the world’s largest developers of industrial property, with tenants including Amazon, Coles and Australia Post.

“Our strategy to provide essential infrastructure for the digital economy is delivering,” he said.

“The business is performing strongly across all segments, including our development projects, leasing success, rental growth, significant valuation uplift and the strong performance of our partnerships.”

He said COVID-19 related disruptions have been “managed to have less impact on the full-year projections than we had initially assumed”.

The result was in line with market expectations, with JP Morgan analysts saying the material growth in development volumes over the past few years, combined with very high margins, should drive significant growth in development earnings as the projects are delivered.

“This, combined with a build-up of performance fees, provides a lot of confidence in the three-year earnings outlook,” JP Morgan’s Richard Jones said in a note to clients.

Loading

Mr Goodman said the focus on higher-density urban developments in capital cities, where demand is high for online shopping, has seen it offer more multistorey warehouses, a trend that will continue as land supply shrinks.

“Goodman is continuing to add opportunities to its portfolio incrementally to support future development in constrained markets, while reducing its impact on the environment through brownfield developments,” he said.