Ladies and gentlemen, thank you for standing by, welcome to the Goodman Group Half-year Results. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question- and- answer session. To ask a question during this session, you will need to press star one on your telephone. Please be advised that today's conference is being recorded. Now I hand the conference over to your speaker today, Mr. Greg Goodman. Thank you. Please go ahead, Greg. Yeah. Thank you very much. Good morning and welcome. I have Nick Vrondas with me on the call. Goodman's global operations have delivered a strong first half result. Our operating profit was AUD 615 million, up 16% on the prior period. Our operating earnings per share was AUD 0.331, up 15% on the previous year. Statutory profit grew to over AUD 1 billion for the half. Goodman adapted early to the operational challenges brought about by COVID-19. Underlying customer demand strengthened throughout the period and provided a strong platform for growth going into 2021. We have created a flexible working environment for our people around the world, which has prioritized health, safety, and their wellbeing. Flexible working at Goodman is our new norm. It suits our culture and global operations. It also protects our people and improves our productivity and diversity. Market conditions remain favorable, the business is performing well. Long-term structural trends are well established and are driving high utilization of space and strong customer demand, which provides us with positive direction around future requirements. As a result, we're upgrading profit guidance for FY 2021 to AUD 1.2 billion, reflecting EPS growth of 12% on FY 2020. The forecast distribution is maintained at AUD 0.30 per security in keeping with our capital management strategy. We have continued to grow the business and keep leverage at the lower end of our target range, both at the group and partnership level. The group has AUD 2.3 billion available in cash and undrawn debt, providing significant liquidity, stability, and financial resources for future growth. Valuations across the group and partnerships have also grown by AUD 1.5 billion for the half, reflecting strong demand, tight supply conditions, and solid underlying rental growth. Goodman has evolved as a provider of essential infrastructure to support the digital economy. This is now driving growth across all our markets and is expected to strengthen further as we head into June. Our business is consumer-centric, and we're keeping a watchful eye on the trends that are occurring. Global online sales increased 30% in 2020, with the convenience of online shopping and consumption of digital media and services fueling enduring change in customer requirements. There is now a very direct correlation between consumer habits, customer demand, and how we position our business. As a consequence of substantial demand around the world, our portfolio occupancy remains high at 98%. We leased 1.9 million sq m of space during the period. We also completed AUD 2.2 billion of asset sales across our partnerships, primarily in Europe, where we refined our investment strategy. The group has responded to global demand, and our development workbook has grown to AUD 8.4 billion, reflective of the long-term structural changes we're seeing in our markets. Work in progress may continue to increase during the remainder of the year. Meeting customer demand for strategically located space close to consumers while making a positive contribution towards a more sustainable world has never been more important. Land is scarce in our infill markets, which makes it very valuable. This, together with the need for more sustainable development, is driving increased intensification of use. Goodman is a leader in the urban regeneration of logistics sites in our markets around the world. We believe that redeveloping existing brownfield sites will have the lowest impact to the environment by intensifying existing urban locations. This importantly requires planning authorities to be conducive to the increased utilization and regeneration of land, including multistory, which will offer more sustainable outcomes. Multistory comprises about 60% of what we're doing around the world, and we expect this trend will continue. We have accelerated the scale and timing of our sustainability targets. We're also on track to decarbonize our operations ahead of 2025, and we've increased our target for renewable power from 100 MW to 400 MW at a cost of more than AUD 400 million for the group and our partners around the world. Our sustainability goals are real. They're aligned with our customers' aspirations. They are progressive, they're appropriate, and they reflect our obligation to take profound action on climate change. We believe anything less will risk obsolescence and future performance of our assets. Thank you. I'll hand over to Nick for a few more comments. Thanks, Greg. Sorry. Let's turn directly to slide 10 as we look at the income statement. We'll first cover the operating profit and then discuss the non-operating items listed at the bottom of the table. Overall, FX movements have not had a material impact on the translation of our foreign income when compared to the prior corresponding half-year period. We can just focus on the key operational drivers of the results. Looking specifically now at the movement in investment earnings, the portfolio repositioning program was active again as we completed many asset sales out of our partnerships. We've also been actively working up the redevelopment of many of our assets. We've been purposely vacating buildings to facilitate this process. As a result, the direct property net rental income is AUD 11 million lower than the same time last year, due mostly to the full period effect of sales of nearly AUD 500 million completed during FY 2020. The other part of our investment income comes through our cornerstone interests in partnerships. Here again, income fell by AUD 6 million compared to the same period last year. Rental increases resulted in AUD 6 million growth, which equates to like-for-like NPI growth of 3%. This was more than offset by the impact of capital transactions, which had an AUD 12 million adverse effect on our share of income. The completion of over AUD 2.2 billion of asset sales this half year and AUD 3.5 billion cumulatively over the past 18 months, combined with the utilization of debt capacity that was created, have resulted in a temporary reduction in our equity capital allocation to stabilized assets in the partnerships. Most of the incremental investment is going into future development activities in the form of CapEx or redevelopment sites. In total, the partnerships invested AUD 3.3 billion in the half year and AUD 6.6 billion cumulatively over the past 18 months. As a result, the group contributed its share of equity, which resulted in a net AUD 400 million of new investment into our partnerships in the half and around AUD 700 million in FY 2020. The average yield on this new equity was around 4%. Given the timing of capital transactions and the long-dated nature of our developments, we expect overall investment income for the full year to be lower than FY 2020. With the ongoing rental growth and the income to be generated from the development assets, we expect our cornerstone earnings to grow in future periods. Management revenue was largely consistent with the first half of FY 2020. Growth in volume of stabilized assets under management was impacted by the sales program, which more than offset the impact of completions and revaluation gains. Performance fees and similar transactional revenues contributed AUD 67 million this half, which is broadly in line with this time last year. The performance and activity levels of the partnerships continues to be strong. We continue to believe that fee revenue, a percentage of AUM, will probably be a little below 1% this year, but average 1% over time. We expect a continuation of growth in management income in the long term as our AUM grows. Realized development income was nearly AUD 400 million for the half. In addition to that, AUD 140 million of our development income was recognized as revaluation gains that sit outside of operating profit. We want to emphasize that we create significant value through the process of land identification, achieving planning outcomes, and project delivery. We have continued to execute on these core functions very well this half. Another feature of our portfolio that we've been highlighting recently is the impact of the larger scale and therefore longer development times. This has resulted in an extension of the development period for the projects in WIP to an average of 18 months, providing enhanced visibility into our development earnings going forward. The recent growth in activity levels has outstripped the impact of the longer development periods. As a result, our average annualized production rate of WIP has increased from AUD 4 billion to AUD 5 billion. The confluence of these factors has meant that realized development revenues in the operating result have grown by AUD 100 million compared to the prior corresponding period. We continue to be enthusiastic about the prospects for development demand, and we expect to maintain our strong activity levels, which bodes well for future revenue. Our operating expenses have been stable as our business continues to be focused on a narrow set of markets, which enables us to grow revenues without significant cost variations. Our aim here is to continue to keep our fixed costs relatively steady and instead to use variable costs such as STI and LTI plans to incentivize and align our people. Our borrowing costs were down marginally as the Australian dollar was relatively steady over the half compared to the prior corresponding period. Because we've repaid some higher cost debt. Partially offsetting this is a reduction in interest earned on cash and the reduction in capitalized interest. Our net weighted average cost of debt is heading to around 1% with the strengthening Australian dollar. We expect our borrowing cost to fall significantly in the second half. Our tax expense was down marginally as we had previously flagged. We currently expect our FY 2021 tax rate to be lower than that of the last year, given the nature and origin of our income. As far as the non-operating items are concerned, we saw around AUD 350 million of revaluation gains in the half year, which represents the group share of AUD 1.5 billion in gains across the entire portfolio of assets under management. Cap rate compression over the half was again prevalent, as were rental increases. Development valuation gains of approximately AUD 140 million were recognized in the half, which accounted for nearly 40% of the group share of the total valuation result. Around half of this was the result of developments completed within the period, and the remainder was from gains emerged on investment properties under development to reflect their significant progress. With the strength of demand of our asset class and the significant contributions from development likely to continue, we expect that positive valuation growth will persist in the near term. Another customary area of difference between operating and statutory profit is the fair value movements of hedges, which were up nearly AUD 200 million overall. The Australian dollar rally since June has been the main contributor to this. As usual, we also exclude the accounting cost of the employee long-term incentive plan. We do include the tested units in the denominator when calculating our operating EPS. A few remarks now regarding the balance sheet on slide 11. FX impact of the balance sheet, we're comparing December 2020 to June 2020. The strong Australian dollar resulted in a reduction in the translation of our net foreign assets and liabilities by AUD 0.4 billion, which is reflected directly in the foreign currency translation reserve. This is partially offset by the derivative gains flowing through the statutory income statement that we discussed earlier. The wholly owned asset portfolio has been stable overall. This was the net effect of transfers of assets for redevelopment, net of acquisitions, expenditures, and the revaluation gains. Our share of the stabilized assets within our cornerstone investments in partnerships were down by around AUD 150 million. Of this, we had an FX impact of AUD 350 million. We also had AUD 100 million reduction in our proportionate share of investment properties in partnerships due to their asset sales of AUD 2.2 billion, exceeding acquisitions and development completions. This was partially offset by nearly AUD 300 million of revaluation gains. Compared to June 2020, our development holdings are down by AUD 50 million overall. We had a AUD 200 million increase in our share of the partnerships development capital allocation as a result of investment and expenditure of nearly AUD 70 million and nearly AUD 70 million of revaluation gains from projects still in the process of development. This is partially offset by the FX translation effect of AUD 100 million. Our directly held development capital was down AUD 150 million due to sales and completions exceeding acquisitions and development expenditure, as well as the AUD 25 million FX translation effect. As we've said before, development cash flow can vary depending on the point in the development activity program we're at, relative to the settlement process for new projects versus the older ones. This was a very strong half for cash inflows. We expect that the working capital allocation to developments will trend up in the near term. Our cash position decreased by around AUD 500 million since June. This was mainly due to the repayment of $0.7 billion of U.S. dollar bonds in the half year, which leaves us in a position where we're down to AUD 2 billion of interest-bearing liabilities. We also had AUD 100 million impact from FX on our foreign-denominated cash holdings. The cash generated from our retained earnings funded the investments into our partnerships, which is entirely consistent with the design of our long-term capital management plans and the distribution policy. FX also had a AUD 200 million effect on our debt translation, which is all denominated in foreign currencies. Our net interest-bearing liabilities, net of cash, have now reduced to around AUD 800 million. That's a good point to turn to slide 12. As I said before, we'll operate our gearing within a range of 0%-25% with the level to be set with reference to the mix of earnings and activity levels. In light of the growth and developments, we aim to maintain low leverage for the foreseeable future. Gearing is nearly 3% lower than June 2020, please note that we're expecting to increase development capital allocation in the near term and there are less asset sales from partnerships foreseen. Gearing may be a fraction higher by June, expected to remain below 10%. That's why our distribution per security is expected to remain at AUD 0.30 for FY 2021, this will enable us to sustainably fund our proportionate interest in the assets we are developing for the long term. That's all from me. Thanks, Greg. Thanks, Nick. That was very comprehensive. Our consumer-centric approach is driving our growth and maintaining our relevance with our customers. Changing consumption habits across the physical and digital space is fundamentally and permanently impacting the volume and nature of demand from our customers. We have the established expertise and operational platform, which we have developed over many years to facilitate this transition. In closing, we've had a good start to the financial year, and we expect it is going to continue for the second half. Based on this, as stated earlier, we're upgrading our forecast for FY 2021 operating profit to AUD 1.2 billion, representing EPS growth 12% on FY 2020. Thank you. Nick and I are now available for questions. Thank you. Ladies and gentlemen, we will now begin the question- and- answer session. If you wish to ask a question today, please press star one on your telephone and wait for your name to be announced. If you wish to cancel your request, please press the pound hash key. Once again, it is star one. Thank you very much. Our first telephone question comes from the line of Simon Chan from Morgan Stanley. Please ask your question, Simon. Hi. Good morning, Greg, and Nick. My first question is probably more for Nick V. here. Nick, I was just hoping to reconcile a few of your comments from your presentation just before, so that we're thinking about the second half properly. Firstly, I think you were saying development completions are expected to hit AUD 5 billion per year now going forward. Is that right? Yeah. We'll call it the production rate. The production rate average over the last half-year, it's about AUD 5 billion. It is going to be a little bit higher going forward because the AUD 8.4 billion that we're at at the moment at 18 months is a little bit north of AUD 5 billion. Going forward, that will be the production rate. The timing of completions on a six-monthly basis is a little bit less programmatic than that, but I think we'll keep guiding you towards that production number. Some completions may happen in June or July, for example, this year, and that could have an impact on the actual completions. If you focus on production rate, I think that's a better way to look at it. Okay. That's fair enough. Regarding disposals, you did a fair bit in the first half. I know you're always pruning your portfolio, but what have you got in your guidance there? Are we assuming another AUD 2 billion, or are we assuming probably a flat number? Yeah. Look, I can probably handle that one. Most of the AUD 2 billion was a reset regard what we wanted to do in Europe. To put that in context, we've now got a European partnership that is very, very close to 100% occupied, with some really high-quality development coming through and being offered, and also done in partnership as well. What we did was made a call on the market we're in, and made a call on certain markets we didn't want to be in in Europe, particularly in the light of where I think the world goes over the next year or two, where you wanna just be in the very strongest markets where you can get the strongest rental growth. The work in Europe, we believe now is primarily done. There will be some sales as per normal, where we look at the portfolio globally, and we'll go, "We're a dynamic business. We're dynamic in the way we look at things." If we see demand shifts or locations that might be less favorable or there's big premiums to replacement costs being paid, things like that, we'll obviously evaluate that. I think that was quite a large number, and we wouldn't see that as the going forward to the second half. I think the second half will be more around that inside AUD 1 billion, I would've thought. Great. The performance fees, correct me if I'm wrong, but that's traditionally second half biased, isn't it? I'd just say in regard to performance of the partnerships, and a lot of this is timing on performance fees, obviously. We're in the mid-teens. We're in the mid-teens last year. There's a lot of accumulated performance that's accumulating in those partnerships this half, but also running into 2022. I think you need to look at performance on a very medium-term basis. Next 2022 and 2023 are looking pretty good. The other tailwinds you have coming up, Nick, just to confirm, tax rate will come down and borrowing costs you're expecting to fall materially. Is that right? Correct. I think just to put that in context, too, net debt is under AUD 1 billion. That's a number I'm particularly proud of. I think to have a business like ours that has got a development WIP that's growing, AUD 8.4 billion I think indicated will be increasing into June. To have a net debt position of AUD 1 billion, which is pretty much one year's operating earnings, is a very, very strong position with the construct of our business at this point in time. That's all fantastic, guys. Putting all of that together, I'm just struggling to understand how your guidance, it's implying a weaker second half relative to first half 33 cents in the first half and your guidance is implying AUD 0.64 for the full year. I'm just struggling to reconcile your comments there, Greg. I think when you get to June, you need to look at FY 2022 as well. I think you need to take everything in context. Yeah. Our business is in really strong shape. The second half is going to be strong in regards to activity levels. With the longer-term nature of our developments and things of that, the structural changes in the business and the customers means that we've got a lot more opportunity over two or three years to be looking at visibility on profitability. We think 12% is a really good number, and we think FY 2022 is what we're really focused on now to make sure that we have a good FY 2022. Okay, that's fantastic. Thanks, Nick. Thanks, Gregory. Thanks. Our next telephone question comes from Sholto from Jefferies. Please ask your question. Oh, hi, Greg and the team. Chan got a lot of the good ones in, but look, just a few follow-ups there. I think you said less than AUD 1 billion of asset sales in the second half. Is that correct? Yeah. Just to clarify a few things, on the AUD 140 of development non-cash revals in the development earnings, what was the PCP equivalent in one half 2020? Can I come back to you, Sholto? I don't have that number at my fingertips right at the minute. I think it was lower, but I don't have the exact number. We might come back to you on this. Yeah, that's fine. Just to be clear, on your share of the revals of AUD 350, that doesn't include the AUD 140. That's just in stabilized properties on the AUD 350, isn't it? On the below the line. No, it does include, 350 is all-inclusive. Yeah. Yep. Okay, sweet. Thank you. Then just to clarify Chan's question, obviously you had a very strong development earnings, which is going to be elevated and the asset sales, obviously, you get the full year effect. To clarify that second half lower number is really just that investment line because you get the full year effect of those asset sales from 2020 and the first half of 2021. Would that be a fair comment? Sholto, I've got to be honest, No, I got this one, Nick. I think that's about right. The development earnings are going to be strong, you've got to have a look through into 2022 as well, because a lot of projects will go through. Work in Progress, guys, is probably going to move through AUD 9 billion during this half and actually we're probably there right at the moment, at this point in time. We're going to be looking really good in 2022 on development volume. You guys can work out the margins from what we've given you, and the margins are good. In that Work in Progress number, that is not a full mark to market in regard to exit cap rates, too. There's some flex in that as well. Development's going to be strong in 2022. You've got growing Assets Under Management because of that AUD 8.5 billion-AUD 9 billion, 90% of that we're keeping. If you look at the duration and the length on the lease terms, very, very good. The stuff we're developing in the main, we're keeping. You add that to assets under management with AUD 19 billion of undrawn debt and equity around all our partnerships, we can grow organically very well over the next year or two. I think you want to look through, obviously this year into 2022, because a lot of these development projects are going to be into 2022 as well. Yeah. Good visibility of earnings there. Just on the asset sales, is it mainly Europe? Are you looking at trimming the portfolio anywhere else? Is it just mainly that European stuff? Yeah, it was mainly the European stuff. We did have a bias to sell fully developed assets in North Ryde. I don't think you'll see us holding a lot of suburban office assets unless they've got redevelopment potential. There was probably AUD 500 million in that area. We've done most of that and got some very good prices. I think we are just refining what we're doing. We are watching, and I mentioned it earlier, we're watching the consumer at the moment very, very closely. We're trying to understand what our customers are seeing in regard to how the consumer's going to live, what are they going to do, where are they going to spend the money? Are they buying all electric cars? Jaguar in the U.K. now is going all electric by 2025. These things are major moves, guys, and these moves are creating opportunity, but also creating a time to pause and think about, do you want to be there or do you want to shift your strategy? You need to be dynamic. I think the last 12 months has taught probably everyone around the world, expect the unexpected, and make sure you match fit every day you go out on the park. I think we're really focused on just getting the best growth, the best locations where we don't feel vulnerable. I think the other couple of questions about sustainability and obsolescence, right? If we don't get with it and we don't have offerings to our customers that include the renewable plans around buildings, they will not go into your buildings in the future without it. People are going to be retrofitting these buildings in the future, to comply with what our big customers are asking for today. Everyone's on that plane. There's a lot of areas you need to look at, and you need to be refining what you're doing all the time, and that's what we intend to continue to do. Just on the performance fee, Greg, I think you had about AUD 207 million last year. The first half looks like it's in line. You said about 1% of AUM external. What do you expect the performance fees to be this year? Broadly similar than last year? I think we flagged, Sholto, that it'd be slightly lower. Okay. That's what we're running with. Just finally on the WIP, very strong demand clearly. Looks like it went up a bit in Asia in the half. Where's the incremental demand coming from in this half? I think you'll find U.S. has well over AUD 1 billion in planning right at the moment. Planning is not an exact science, we've got basically demand behind that is probably over AUD 1 billion in the Americas in total. We've actually got three or four buildings coming out of the ground. Four buildings coming out of the ground in Brazil, too, by the way. There's 250,000 meters coming out of the ground this half. There's a bigger contribution from the Americas. I've got to say, coming back from Christmas and talking to the team here in Australia as well, we've had a really busy January, as everyone's been thinking about what they need to do during 2020. COVID, obviously, was a massive shake for the world to understand that these things can happen. A lot of our customers, big customers in Australia, have gone, "Wow, we need to move and make sure that we've got facilities and protections for the future." A lot of what will happen this year will be around managing a COVID situation that is going to be more enduring than just a snap 12 months. A lot of strategies have changed, and I think you'll find that'll come through in our work around the world in 2021 and 2022. Yeah. Just finally on the development WIP. Your margin's 6.6 and the stabilized cap 4.7. That's implying about a 40% margin. Do you confirm you're getting above 35% on your development if you do that math? Look, I think you've done the math. We're in very, very good shape. Once again, we're in good shape over the next few years in development, clearly, and we'll be adding to it incrementally. That's what we do. We bought, I think I mentioned at the quarter, we bought AUD 1 billion of additional sites in the last four or five months. Those sites would have a build-out value of probably close to AUD 3 billion, and good margins, but they will be in production in 2023 and 2024 and 2025. Everything we're doing is looking five, six years out in development. Very, very rarely are we buying something that's ready to go today. That would be the exception, not the rule. All right. Great. Thanks, Greg and everyone. Cheers. Our next telephone question is from Stuart McLean from Macquarie. Please ask your question, Stuart. Good morning. Greg, just picking up a comment you just made there that you'll be adding WIP incrementally, and you just gave an example there of AUD 3 billion of production from a couple of assets you bought recently. Your comment of adding WIP, that's not just backfilling some of these large projects as they start to roll off over 2021, 2022, 2023. You're saying on a five-year view, you can just continue to grow that absolute WIP number? Yeah. I think if you look at global demand, let's just look at the world, and you look at the way the world is changing in regard to the way people are living. What we're trying to do is go back to the consumer. We're trying to look at how they're living, what changes are they making to their lives, and that might be they've got flexible working, for example, and that might be enduring. What does that cause? Cause and effect. Well, it means that they're probably shopping a little bit more online, and they can get the parcels delivered because they might be home two days a week. You've got to look at how people are living, because our customers, big customers around the world, are looking at that, right? We're looking at that, we're looking at our customers, and then we're trying to move ahead of where we think the demand pockets are. When we look at the world over the next five years, and we've got a five-year plan and a five-year strategy, that we believe the development volumes we're doing now will be pretty solid over the next five years because of these fundamental structural changes and the demand we see in behind the development. The point about multistory and the point about regeneration sites is a big one, and it's one that I think we certainly want to advance in Australia and are advancing planning on a number of sites, where we've got to utilize the lands and what we've got around our cities, probably with electric vans, multistories, things like that, which is not just plowing and knocking over trees and greenfield sites. You look at the whole ecology and the demand and the consumer and the way the world's rotating. Goodman is uniquely placed with our people and infrastructure who just focus on this stuff to do pretty well over the next five years in regard to taking those opportunities. Great. Thank you. Just looking at the cap rates across the management platform, I think it's on slide 18. Just look at GAIP at 5%, at GP at 4.4%, and you keep going through the list. These seem pretty elevated compared to where a real estate agency would tell you or where the last transaction occurred at. Is there a reason why these cap rates seem a little bit more elevated? Is it about the valuation time life cycle? Just trying to gauge future performance in the funds driven by valuation movements. Look, I think you've made the statement, and I agree with you right at the moment. Whether that's the same in six months, I don't know. Fundamentally, I think from a value point of view, there is upside in the global portfolio. There's no doubt about that. If you want to put a global cap rate on the world at the moment, a 475 or a five looks like a four and a quarter today. Whether that holds true over the next six months, let's wait and see. Yeah, I think there's room there, and I think you'll see that come through in this half. We're in at the moment through the valuation line. Great. Just a final one, might be for Nick. Just on capital requirements for the business. A strong half of cash guiding to gearing, ticking up. Is there an ability to start growing the distribution again relatively soon, or still looking to retain as much capital and really focus on balance sheet flexibility and making sure you don't use all of that up? For this year, we've made our call. The board will look at distribution policy again with the upcoming year. We'll have a look at where we sit at that point in time. Like I said, we'll take into account what we're doing, the activity levels, and capital needs. I think, sitting here today, as Greg's just sort of highlighted, looks like we're going to be pretty busy. I would be suggesting that we will continue to be quite active in the mix of earnings. We'll probably continue to take the shape it currently has. Look, we can't make a call on what the board might decide for next year yet. Thanks very much. Cheers. Our next telephone question comes from Grant McCasker from UBS. Please ask your question, Grant. Good morning. Just one question. It's a phenomenal development result, are you able to just give us a little bit more clarity on where those development earnings are coming from? The reason I ask that question is operating earnings coming from U.K., Europe now across the entire business, it's sitting at 44%. Usually it runs at 20%. Are you able to just call out or just give it a little bit more clarity on that. Also, can you give some sort of guidance on how much profit was recognized when you sold the development component of the Eastern European portfolio? Yeah, look, most of the activity with the sale went through the partnership anyway. There were a few developments that went through that, so that was part of the number. I think if you look at Europe in totality with the number for this half, they had a big half, but I think you'll find that will average out over the year and into 2022. We've got a lot starting in the U.S. which I more talked about before, probably well over $1 billion of starts there. I think Australia is actually going to have a pretty solid second half of this year with all the requirements we see coming through as well. Asia, and there's no surprise in places like China, where primarily they've come through certainly the last six months pretty well, and they're back to business. You can imagine we would see the second half of this year in China pretty strong as well. The Kiwis will be in the second half of this year, once again around a lot of structural change. They're actually going to have a pretty good development book as well. I think if you look through it, I don't think you'll find that'll necessarily be the case by the time we get to the end of the year. Yeah, well, I guess I'm just trying to get if there's material profits being recognized from that asset sale versus just the underlying development run rate? Yeah, nothing extraordinary, Grant. Bear in mind, it's only a six-month period. You've got to look at our developments on a full year and a multi-year basis. Sure. No, nothing extraordinary. I think we did say, too, when we posted the last result, which was the full-year result, and also I think we indicated that we had a head of steam up at about August last year. That's just come into the first half of this year. COVID slowed the world down a little bit in regard to thinking about what they would do, but ultimately people snap back into gear and going, "Right, I don't have time. I've got to get on and change the way I do business." I think you'll find that theme is continuing, and will continue right through 2021. We believe a lot of the plans being made now are going to hit us 2022, 2023 in a positive way. Okay, excellent. That's very clear. Thanks, Greg. Thanks, Nick. Thanks. Our next telephone question comes from Suraj Nebhani from Citigroup. Please ask your question, Suraj. Thank you. Just on the development business, obviously it's been a very strong first half. Should we expect that the profitability for the full year is skewed to the first half, or are you expecting a similar result there in the second half, Nick? I think the full-year guidance that we've given you is at a consolidated level, AUD 2 billion profit. We're not giving any specific guidance on the composition of that right at this point in time. As Greg said earlier, really we're still looking at it with an eye to FY 2022 at this stage. There are a few items that will contribute to all of that. We'll have to apprise you of that as we get to June. Okay. On the margins, I noted comments around recent site acquisition. I'm just wondering, like the development margins, how does the profile look going forward, especially on the sites you're acquiring today? Oh, they're very good. We're not buying shovel-ready, site-ready to go, so there's a lot of work we need to do, and we've got a particular skill set and a particular excitement about buying the things that have got good long-term value. We're not trying to buy shovel-ready, site-ready today in the main unless we've got a specific customer requirement that will drive us to do that. When you look at development over the long term and over the last 20 years, 30 years, good sites and good locations, spend the time on them, do it deliberately, understand what you're trying to achieve at the end of it, and you do okay. Right? That's where we sit. That's what we do, and that's what we think about. We're not thinking about trying to pay a top price today and shovel-ready and get out there and compete with everyone else. That's not what primarily we try and do. Occasionally that occurs, but not often. What we buy and what we do has got four or five years in mind. You would expect if you're taking that time, and you're taking that deliberate move, and you're picking the market, and once again, I go back to what's the consumer doing? Let's just focus on that guy for a moment or that person for a moment, and see what they're doing. Talk to your children, see how they're going to live. That's what I do, and other people's children as well, and other staff members that have children. Just look at where the trends are going, and then you try and move ahead of it. That's the art of it. There's nothing revolutionary about it. That's how you make your money in our business. Yeah. Fair enough. Just finally, on the management side, I think, Nick, in your presentation, you talked about overall fees sort of being below 100 bps this year but tracking towards 100 bps next year. I would have thought with the comments about performance fees, is it likely that it probably exceeds 100 bps going to 2022, 2023? Yeah. I think that's why we encourage you to look at it on a long-term basis. There are some short-term timing issues as well about when they're recognized and such like, which has a bit of an impact. On average, over time, 1%. We've been through periods where it's been well above 1%, so it can be more, but I think the best estimate we can give you is around 1%. I think if you use that as a guide, I think you'd be well-served. Thank you. Our next telephone question comes from James Druce from CLSA. Please ask your question, James. Yeah. Hi. Good morning, Greg and Nick. The questions have been pretty comprehensive, so this is really around the edges. Just wondering if you could put a number around restocking over the last six months. Secondly, just on the mix of developments you're thinking about going forward, how should we think about developments from actual income-producing assets versus sort of your long-duration brownfield sites? Yeah, I think we mentioned there's about AUD 1 billion we picked up in the last period, which works through at about AUD 3 billion in completions. That then will take place over the years. I think the earlier comments I made about getting real about what we're doing in regards to sustainability issues around regenerating industrial lands we've already got, and this is a global theme. We are knocking buildings over now in China, around Shanghai, that we've owned for less than 10 years, and they are single story. There are planning regimes in certain parts of the world, you cannot build single story, and you're encouraged to knock your single story over and go multistory. Most of the big cities and the big countries around the world realize that land is a scarce resource. You have to resource it. You have to keep pushing services out to it. Often the best outcome, certainly around the sustainability aspects as well, of plowing land and knocking over trees and affecting the ecology of the world is not necessarily the best way to go. When we look at it going forward, this is my view, and I think it's the view we've taken in our five-year plan as well, that we'll be doing more of the regeneration of what we already own and value add. There's a number of examples of that, and there's a number of examples we're looking at in Europe at the moment around some of the big cities of Europe where we're going to go, "I speak multistory." Some have already done it, and that makes sense. You've got to look at it. Goodman owns AUD 50-odd billion of assets. You've got to look at where we own them and why we own them. If you take the China example, something 10 years ago that might have been single story, today you're knocking it over, and you just want to think about that because it gives us a lot of flexibility and a massive opportunity as our portfolio global builds out to AUD 60 billion and AUD 70 billion over the next few years. We've got plenty of opportunity. It comes back to what I've been emphasizing this morning. Look at the consumer, look at how they're living, look at the structural changes that are going on, which are immense around the world, right? Try and take a bit of a view of the way you think you're going to be living and your families over the next five years. You'll get an idea of what we're seeing. It is profound and it's structurally enduring, and I said that in my speech, that I think you'll find that there's a lot of opportunities, and a lot of it's in that infill regeneration. We need a bit of planning assistance on some of that. I think planning around the world needs to catch up. I think there was a really good comment from Bill Gates the other day. I think he was talking about 30% of the world's carbon was generated out of concrete and steel production. We've got to get a hold of that. Goodman's a big user of concrete and steel. Those things need to be addressed, and they can be best addressed by doing better with infrastructure and resources we've got. That's a major thing we're looking at when we're buying sites, certainly now and for the next five years. That's helpful. Thank you. Thanks, James. Our final question today comes from Rich Jones from J.P. Morgan. Please ask your question, Richard. Thanks. Greg, just in relation to the intensification and multistory trend that you're talking about, can you discuss what that might mean for margins? It's harder. Planning's more difficult, takes longer. I think you'd need to make sure you've got a good margin. To do that, you're probably going to have to spec more space as well in that environment. I think you'd find margins at the end of the day are very good, but they need to be. You need to be good at it as well. We do a lot of this stuff. Right at the moment we're planning a couple in Europe, so they're talking to our teams in China. We've gone to a steel-based structure in China, gone away from concrete. We're looking at some stuff in Sydney at the moment where we might use more concrete in combination with steel. A lot of things we've learned around the world from Japan or from China or Hong Kong, the extreme, where you've got 20-odd stories. We're using that globally to develop the Goodman plan around it. It's no one else's plan, it's our plan, the way we want to do it, to make sure that we keep the risk low, because risk is high, right? Keep the risk low, the margin's very, very good if you can manage all that risk. Okay. Just final question, just in terms of the Asian WIP that's at AUD four and a half billion, are you able to break out Hong Kong versus China versus Japan and logistics versus data center in those numbers? Yeah. Of that, there'd be AUD 1 billion or so of data center and the rest is industrial. If we are building a data center, for example, in Asia, we're doing one at the moment, which is pretty good. It's actually an industrial building, which a data center is occupying. It's not useful necessarily. It's more about are we building specialized data center buildings? Is more the question, and I think in the main, no. In Hong Kong where we are doing a building that's got data center going in it's wrapped in a commercial fabric which could go back to commercial. We're trying to make sure we're not leveraging against a specialized data center business, which honestly, we don't know what will look like in 10 years' time. I suspect there's going to be concepts about compression of data and more efficiency and productivity inside those data centers. If I was to place a bet, I would say you'll be doing more with less space and data in the future, but you'll have more data. In the main, what we're building in Asia is logistics space, and a couple of them have got data centers in them. The one in Hong Kong is commercial fabric with all the traditional basements and parking if required for commercial conversion. Yep. Just the geographic mix of the Asia is four and a half? Look, we just kicked off AUD 1 billion in Hong Kong, which is industrial. That's where I think you'll find the Asian number moved. That's Westlink. We decided the demand was such, and the pre-commit on that was such that we would do that. We did that. That's the major move in Asia in the last, I suppose, six months. That'd be fair, wouldn't it? Yeah, that's right. That's right. I think, just overall on that point, obviously, if you look at the last quarter, we've worked through a huge amount of our previously unlet space, and that gave us the confidence to bring more forward. We're managing that progressively, in line with demand levels. I think in China, in the last few weeks, we kicked off another AUD 400 million in China, I think it was, since the numbers in December. China, we see a big opportunity for us over the next two or three years. We've redefined where we are. Shanghai, Beijing, down into Shenzhen. Only the best markets. There's more demand than there is supply, and everything we've got going there is filling really quickly. The stabilized portfolio is in the 99% occupied, and we're getting real rental growth. Expect China to be pretty good, we think, during the next year or two. Great. Thanks. Sure. There's no more further questions at this time. I'd like to hand the call back to Gregory Goodman for any closing remarks. Please continue, Greg. Yeah. Just before Greg goes back, I just wanted to go back to Sholto's question, just for everyone's benefit. We didn't disclose the proportion, the actual dollars in the prior corresponding period of contribution from development revals, but the guidance I can give you is that it was just under 15% of the total reval number. This period was about 40%. Hopefully that's helpful. As I said, it's an escalating trend going forward, we think. That's all, Greg. Okay. Hey, thanks, Nick, and thank you everyone for your time. Let's look forward to, hopefully, vaccinations and a little freer life. We, looking around the world with all our people around the world, we're looking forward to hopefully a very productive 12 months and maybe some better health outcomes as well. Thanks, everyone, and appreciate your time. Ladies and gentlemen, that does conclude the call for today. Thank you for all participating. You may all disconnect. Have a great day.