Goodman Group’s (ASX: GMG) $14.4bn Data Centre Bet Signals AI Infrastructure Boom

Key Highlights:

• Operating profit of $1.2 billion in 1H FY26

• Data centres now 73% of $14.4 billion work in progress

• Global power bank expands to 6.0 GW across 16 cities

• $87.4 billion total portfolio, occupancy steady at 95.9%

• Targeting 9% EPS growth for FY26

The race to power artificial intelligence is not just being fought in Silicon Valley. It is also unfolding in industrial estates from Sydney to Frankfurt, and Goodman Group (ASX: GMG) is positioning itself at the centre of it.

The property giant, long known for warehouses and logistics hubs, has effectively recast itself as a global digital infrastructure player. Its half year results show operating profit of $1.2 billion for 1H FY26, with operating earnings per security of 58.5 cents and statutory profit of $824.7 million.

But the real story is not the profit line. It is the pivot.

Data centres now dominate the pipeline

According to Goodman’s presentation, data centres now account for 73 percent of its $14.4 billion development work in progress  . Just a year ago, that figure was 46 percent. The shift is sharp and deliberate.

The group’s global “power bank” has expanded to 6.0 gigawatts, with 3.6 gigawatts of secured power across 16 major cities  . For context, one gigawatt can power hundreds of thousands of homes. In the data centre world, it translates to the energy backbone needed to run hyperscale cloud and AI workloads.

On page 10 of the investor presentation, Goodman notes it has delivered and manages 0.7 GW of stabilised data centre assets and has 0.4 GW currently in work in progress  . It expects projects providing 0.5 GW to be in progress by June 2026.

This matters because AI systems require immense and constant electricity. Industry estimates cited in the presentation suggest hyperscale cloud revenues have been doubling every three to four years, particularly in Continental Europe and Japan where cloud penetration remains relatively low. Supply, however, is constrained by access to land and power.

Goodman’s strategy is simple in theory and complex in practice. Own the sites in dense metro locations. Secure the power years in advance. Partner with long term capital. Then build.

A $14 billion European partnership

In 1H26, Goodman established the $14 billion Goodman European Data Centre Development Partnership to fund a 435 MW portfolio  . It also flagged that an Australian data centre development partnership is expected to be established in FY26.

These partnerships allow Goodman to recycle capital while maintaining a cornerstone equity stake. The group manages 24 partnerships globally with average partnership gearing of 23.1 percent  . External assets under management have climbed to $75.2 billion.

It is this capital partnering model that analysts often describe as “institutional gold”. Rather than simply collecting rent, Goodman earns development profits, management fees and co investment returns, all layered onto prime urban land.

Solid balance sheet, steady portfolio

Away from data centres, the core portfolio remains resilient. Total portfolio value stands at $87.4 billion, up 2 percent since June 2025  . Occupancy is high at 95.9 percent, and like for like net property income growth came in at 4.2 percent, despite some softness in Greater China.

Capitalisation rates tightened 5 basis points to 5.0 percent over the half  , reflecting continued demand for well located logistics and digital assets.

Financially, the group remains conservatively positioned. Balance sheet gearing is 4.1 percent, with $5.2 billion of liquidity and an investment grade credit rating of BBB+ from S&P and Baa1 from Moody’s  . It declared a 15 cent per security distribution for the half and is targeting 30 cents for FY26.

Management is targeting operating EPS growth of 9 percent for FY26, subject to market conditions.

Not just sheds anymore

Historically, Goodman built its reputation on warehouses near ports and airports. Today, those same metro locations are prized for a different reason. Data must travel quickly. That requires connectivity dense sites close to users and fibre networks.

In its recent presentation, the company notes that power and sites are key constraints in supply constrained cities, reinforcing the value of long held land banks. In other words, the barriers to entry are rising.

For broader markets, the message is clear. The AI boom is not just about chip makers and software firms. It is also about who owns the land, the power connections and the balance sheet to deliver at scale.

Goodman is betting that the infrastructure behind the digital economy will prove as essential as the warehouses that powered e-commerce a decade ago.