Goodman Property Trust Interim Report 2009

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					Goodman Property Trust
Interim Report 2009




solid
foundations
contents+


    03
    Highlights
                                28
                                Regulatory Disclosures   A high quality property portfolio,
    04
    Results Overview
                                31
                                Investor Relations
                                                         a strong balance sheet and
    05                          32                       proactive management make
    Chairman’s & CEO’s Report   Glossary

    08                          33
                                                         GMT a resilient business.
    Financial Report            Corporate Directory




for today
and tomorrow.                                            Schneider, Highbrook Business Park, East Tamaki
1                                                        Goodman Property Trust Interim Report 2009        2
highlights+                                                         results
                                                                    overview+




                                                                                                                                            30 September    30 September
    Debt as a                 Weighted average   Occupancy across                                                                                   2009            2008
    percentage of             lease term         the portfolio
                                                                    Distributable earnings before taxation ($M)                                     39.4            44.6
    property assets1, 2
                                                                    Distributable earnings after taxation ($M)                                      38.5            42.7
                                                                    Property valuation movement ($M)                                               (22.0)          (57.0)




    35.5 5.7              %
                                                 95        %
                                                                    Net profit after taxation ($M)                                                  13.2           (11.3)
                                                                    Distributable earnings per unit (cents)                                         4.54            5.11
                                                                    Total assets ($M)                                                             1,554.1        1,619.5
                                         years
                                                                    Total property assets ($M)1                                                   1,470.9        1,569.2
                                                                                             2                                                     522.6           486.8
                                                                    Total borrowings ($M)
    Distributable                         Total property            Underlying total borrowings to total property assets (%)    1,2                 35.5            31.0

    earnings after                        assets                    Adjusted NTA backing per unit ($)                                               1.03            1.23

    taxation                                                        1

                                                                    2
                                                                        Adjusted for unconditonal and pending asset sales at 30 September.
                                                                        Total borrowings net of cash and adjusted for unconditonal asset sales.




    $
      38.5M 1.5B                         $


3                                                                   Goodman Property Trust Interim Report 2009                                                          4
Chairman’s and
chief executive officer’s report
The Board and Management are
pleased to present Unitholders with
the interim report for the six months
ended 30 September 2009. The Trust
has delivered a sound performance
over the period, recording an operating
result consistent with the guidance
provided earlier in the year.
                                                  Greg Goodman, Acting Chairman   John Dakin, Chief Executive Officer   CSR Viridian, Highbrook Business Park, East Tamaki



Result overview                                   The performance of the investment portfolio                           Capital management                                   which is at the lower end of the Board’s targeted
Operating revenue increased 5.0% or               has ensured the Trust has delivered an                                The Trust has maintained a strong balance            35%-40% range.
$2.6 million from the previous corresponding      operational result in line with expectations.                         sheet position over the last 18 months through a     Maintaining a strong balance sheet remains an
period, to $53.5 million. The increase in         Recording distributable earnings of 4.54 cents                        series of prudent capital management initiatives     important focus and these initiatives have been
revenue reflects rental growth across the         per unit over the six months is a pleasing                            that have included:                                  part of a considered response to the wider
portfolio and the contribution from completed     achievement given the subdued business                                                                                     economic environment.
                                                                                                                        + Renegotiating the renewal of debt facilities
development projects but is partially offset by   environment that has existed and the higher
                                                                                                                          12 months ahead of expiry.                         Goodman+Bonds
the impact of asset sales and a small increase    financing costs corporate borrowers now
in portfolio vacancy.                             incur.                                                                + Asset sales.                                       A further initiative has been the issue of
                                                  Increased interest costs, following the                                                                                    Goodman+Bonds, undertaken after the interim
In a property market demonstrating lower                                                                                + Selectively allocating capital to development
                                                  refinancing of the Trust’s debt facilities                                                                                 balance date. The $150 million corporate bond
levels of customer demand, the Trust has                                                                                  opportunities.
                                                  in December 2008, have impacted                                                                                            offer received strong support reflecting the
achieved an occupancy level of 95% and a                                                                                + Amending the distribution policy to retain up
                                                  distributable earnings which total $38.5 million                                                                           investment market’s confidence in GMT’s business
weighted average lease term of 5.7 years                                                                                  to 10% of earnings.
                                                  compared to $42.7 million in the previous                                                                                  and the unique characteristics of the offer.
through active management and concerted
                                                  corresponding period.                                                 The successful asset sales programme has             Key features of Goodman+Bonds include:
leasing campaigns.
                                                  While distributable earnings are within the                           realised over $100 million in proceeds which
Other portfolio highlights include:                                                                                                                                          + Investment grade credit rating of BBB+ from
                                                  guidance range, a devaluation of $22.0 million                        have been used to repay debt and fund
                                                                                                                                                                               Standard and Poor’s.
+ The leasing of 45,500 sqm of rentable           has reduced reported net profit to $13.2                              development activity. Recent sales have
                                                  million. The Trust’s total property assets at                         included Pernod Ricard NZ House, located in          + 5 year term, maturing June 2015.
  space to new and existing customers.
                                                  30 September 2009 are $1.5 billion and the                            Auckland’s Viaduct precinct and Aurecon House        + Senior ranking, sharing security alongside
+ Achieving annualised rental growth of           weighted average capitalisation rate across                           in Newmarket which sold in August and October          GMT’s main banking syndicate.
  2.9% pa from the rent review programme.         the portfolio is 8.8%.                                                for $26.6 million and $26.7 million respectively.
                                                                                                                                                                             + Competitive interest rate of 7.75% per
+ A new 10,355 sqm development                    The devaluation has no impact on distributable                        Following the completion of the pending
                                                                                                                                                                               annum, paid semi-annually.
  commitment secured for Ingram Micro at          earnings but it does contribute to a reduction in                     settlements, the level of debt within the
  M20 Business Park.                              adjusted net tangible assets to $1.03 per unit.                       portfolio equates to 35.5% of property assets        + NZDX listed.



5                                                                                                                       Goodman Property Trust Interim Report 2009                                                             6
Steel & Tube, Highbrook Business Park, East Tamaki


The offer of Goodman+Bonds is an important           Unitholders should be reassured by the
component of GMT’s capital management                performance of the Trust and the prudent capital
strategy that further strengthens the Trust’s        management strategies that have been adopted.
balance sheet. The proceeds of the issue will        GMT’s strong balance sheet position has been
be used to repay bank debt diversifying GMT’s        enhanced while active management continues
sources of debt funding and extending the            to ensure the performance of the property
average term of its debt facilities.                 portfolio is maximised.

Outlook                                              On behalf of the Board and Management.

The performance of the business over the
first six months of the 2010 financial year
has shown GMT to be a robust and resilient
business. The quality of its customers and the
contracted rental streams that they provide have
contributed to a sound operating result.             Greg Goodman           John Dakin                                                               financial report
                                                     Acting Chairman        Chief Executive Officer
While the property market has been subdued
                                                                                                                                                     Contents
in comparison to more recent years, there
are signs of increasing business activity and                                                                                                        09                 consolidated comprehensive income statement
                                                                                                                                                     10                                     consolidated balance sheet
rising confidence. These factors are expected to
                                                                                                                                                     11         consolidated statement of changes in unitholders’ funds
have a positive influence on the direct property
                                                                                                                                                     12                               consolidated cash flow statement
market with occupier demand and development
                                                                                                                                                     13                        notes to the interim financial statements
activity likely to increase over time.
                                                                                                                                                     27                                            accountants’ report
Distributable earnings have tracked in line with
expectations and the forecast for the full year
remains within the guidance range of 9.0 to 9.5
cents per unit.


7                                                                                                       Goodman Property Trust Interim Report 2009                                                                    8
consolidated comprehensive                                                                                                  consolidated balance sheet
income statement

for the six months ended 30 September 2009                                                                                  as at 30 September 2009

                                                                                Unaudited        Audited      Unaudited                                                                                         Unaudited      Audited   Unaudited
                                                                                 6 months     12 months        6 months                                                                                         30 Sep 09    31 Mar 09   30 Sep 08
                                                                                30 Sep 09     31 Mar 09       30 Sep 08                                                                                  Note         $M           $M          $M
                                                                         Note         $M             $M             $M      Current assets
Revenue and other income                                                                                                    Cash and cash equivalents                                                      7          2.3          3.4          3.8
Rental income                                                               2        56.5          110.4           54.3     Trade and other receivables                                                    8         34.4         19.8          8.1
Service charge income                                                       3          9.9           19.2            9.7    Current tax receivables                                                                     -            -          1.6
Total revenue                                                                        66.4          129.6           64.0     Total current assets                                                                     36.7         23.2         13.5
Service charge expenses                                                    3          (9.9)         (19.2)          (9.7)   Non-current assets
Property operating expenses                                                3          (3.0)           (6.7)         (3.4)   Investment properties                                                          9      1,294.8      1,297.8      1,295.9
Net rental and related income                                                        53.5          103.7           50.9     Development properties                                                         9        201.7        214.9        296.2
Loss on disposal of investment property                                    4          (2.4)           (0.2)             -   Derivative financial instruments                                                          0.2          0.1          0.8
Net change in value of property investments                                4        (22.0)        (172.8)         (57.0)    Intangible assets                                                                         9.9          9.9          9.9
Fair value gain on interest rate derivatives                                         11.6              2.3              -   Deferred tax assets                                                                      10.8         15.7          3.2
Other administrative expenses                                              4          (3.6)           (7.3)         (3.6)   Total non-current assets                                                              1,517.4      1,538.4      1,606.0
Finance (costs)/income                                                                                                      Total assets                                                                          1,554.1      1,561.6      1,619.5
Finance income                                                             4           0.1            0.4            0.2    Current liabilities
Finance costs                                                              4        (10.6)           (9.8)          (2.9)   Trade and other payables                                                      10         27.0         37.0         28.2
Amortisation of cash flow hedge reserve                                    4          (7.2)              -              -   Current tax payable                                                                       1.0          1.2            -
Net finance costs                                                                   (17.7)           (9.4)          (2.7)   Derivative financial instruments                                                          0.9          0.9            -
Profit/(loss) before income tax                                                      19.4          (83.7)         (12.4)    Total current liabilities                                                                28.9         39.1         28.2
Income tax (expense)/benefit                                               5          (6.2)           9.6            1.1    Non-current liabilities
Profit/(loss) for the period attributable to the unitholders                         13.2          (74.1)         (11.3)    Interest bearing liabilities                                                            576.2       549.4         513.5
                                                                                                                            Derivative financial instruments                                                         26.1        37.6           9.0
Other comprehensive income                                                                                                  Deferred tax liabilities                                                                 34.7        33.3          43.5
Cash flow hedges, net of tax                                                            -           (35.0)        (11.2)    Total non-current liabilities                                                           637.0       620.3         566.0
Change in fair value of cash flow hedges transferred to profit or loss                  -             (2.4)         (4.1)   Total liabilities                                                                       665.9       659.4         594.2
Amortisation of cash flow hedge reserve                                               5.0                 -             -   Net assets attributable to unitholders                                                  888.2       902.2       1,025.3
Total other comprehensive income for the period, net of tax                           5.0           (37.4)        (15.3)    Unitholders’ funds
Total comprehensive income for the                                                   18.2         (111.5)         (26.6)    Units                                                                         11        982.2       975.2         971.5
period attributable to unitholders
                                                                                                                            Reserves                                                                                (54.3)      (37.4)         69.9
The consolidated comprehensive income statement is to be read in conjunction with the notes to the interim financial        Accumulated losses                                                                      (39.7)      (35.6)        (16.1)
statements set out on pages 13 to 26.                                                                                       Total unitholders’ funds attributable to unitholders                                    888.2       902.2       1,025.3
                                                                                                                            The consolidated balance sheet is to be read in conjunction with the notes to the interim financial statements set out on
                                                                                Unaudited        Audited      Unaudited
                                                                                                                            pages 13 to 26.
                                                                                 6 months     12 months        6 months
                                                                                30 Sep 09     31 Mar 09       30 Sep 08     The Board of Goodman (NZ) Limited, the Manager of Goodman Property Trust, authorised these financial statements for
                                                                         Note       cents          cents          cents     issue on 5 November 2009.
Basic and diluted earnings per unit                                         6        1.56          (8.84)         (1.35)    For and on behalf of the Board
Distributable earnings before tax per unit                                  6        4.65          10.38           5.34
Distributable earnings after tax per unit                                   6        4.54          10.00           5.11


                                                                                                                            Greg Goodman                        Keith Smith
                                                                                                                            Acting Chairman                     Director and Chairman, Audit Committee




9                                                                                                                           Goodman Property Trust Interim Report 2009                                                                            10
consolidated statement of changes                                                                                        consolidated cash flow statement
in unitholders’ funds

for the six months ended 30 September 2009                                                                               for the six months ended 30 September 2009

                                                                              Unaudited        Audited     Unaudited                                                                                            Unaudited        Audited     Unaudited
                                                                               6 months     12 months       6 months                                                                                             6 months     12 months       6 months
                                                                              30 Sep 09     31 Mar 09      30 Sep 08                                                                                            30 Sep 09     31 Mar 09      30 Sep 08
                                                                                    $M              $M            $M                                                                                     Note         $M             $M            $M
Total unitholders' funds at the beginning of the period                           902.2        1,085.8        1,085.8    Cash flows from operating activities
Total comprehensive income for the period attributable to unitholders              18.2         (111.5)         (26.6)   Net property income received                                                                52.9         105.0           48.4
Net proceeds from issue of units                                                    7.0            12.4           8.7    Net GST collected                                                                            0.8           0.2               -
Distributions provided for or paid to unitholders                                 (39.2)          (84.5)        (42.6)   Other operating expenses paid                                                               (3.6)         (7.3)          (3.8)
Total transactions with unitholders in their capacity as unitholders              (32.2)          (72.1)        (33.9)   Finance income received                                                                      0.1           0.4            0.2
Total unitholders' funds at the end of the period                                 888.2          902.2        1,025.3    Finance costs paid                                                                          (9.6)         (9.5)          (1.7)
                                                                                                                         Income taxes paid                                                                           (2.4)         (1.3)              -
The consolidated statement of changes in unitholders’ funds is to be read in conjunction with the notes to the interim
financial statements set out on pages 13 to 26.                                                                          Net cash provided by operating activities                                         7         38.2          87.5           43.1
                                                                                                                         Cash flows from investing activities
                                                                                                                         Proceeds from sale of investment properties                                                 10.5           44.0           7.7
                                                                                                                         Payments for investment properties                                                           (7.0)        (37.2)        (27.3)
                                                                                                                         Payments for development properties                                                        (25.9)       (119.7)         (68.2)
                                                                                                                         Holding costs capitalised to development properties                                        (11.4)         (22.9)        (12.1)
                                                                                                                         Acquisition of jointly controlled entities/subsidiaries, net of cash acquired                    -          (6.7)            -
                                                                                                                         Net cash used in investing activities                                                      (33.8)       (142.5)         (99.9)
                                                                                                                         Cash flows from financing activities
                                                                                                                         Proceeds from borrowings                                                                    42.6         153.1           92.2
                                                                                                                         Repayment of borrowings                                                                    (16.0)        (24.9)              -
                                                                                                                         Distributions paid to unitholders net of reinvestments                                     (32.1)        (72.1)         (33.9)
                                                                                                                         Net cash (used in)/provided by financing activities                                          (5.5)        56.1           58.3
                                                                                                                         Net (decrease)/increase in cash and cash equivalents held                                    (1.1)         1.1            1.5
                                                                                                                         Cash and cash equivalents at the beginning of the period                                      3.4          2.3            2.3
                                                                                                                         Cash and cash equivalents at the end of the period                                7           2.3          3.4            3.8
                                                                                                                         The consolidated cash flow statement is to be read in conjunction with the notes to the interim financial statements set
                                                                                                                         out on pages 13 to 26.




11                                                                                                                       Goodman Property Trust Interim Report 2009                                                                                  12
notes to the interim financial statements                                                                                         notes to the interim financial statements
                                                                                                                                  continued

for the six months ended 30 September 2009                                                                                        for the six months ended 30 September 2009
NOTE 1. Accounting policies                                                                                                       NOTE 2. Rental income
General information
                                                                                                                                                                                                                   Unaudited       Audited     Unaudited
The reporting entity is Goodman Property Trust (“GMT” or “Trust”) which is a unit trust established on 23 April 1999 under                                                                                          6 months    12 months       6 months
the Unit Trusts Act 1960, domiciled in New Zealand. The Manager of the Trust is Goodman (NZ) Limited and the address                                                                                               30 Sep 09    31 Mar 09      30 Sep 08
of its registered office is Level 3, 203 Queen Street, Auckland. The consolidated interim financial statements of GMT for the                                                                                            $M            $M            $M
six months ended 30 September 2009 comprise GMT, its subsidiaries and its jointly controlled entities (together referred to       Gross lease receipts                                                                  57.2         111.1          54.6
as the “Group”). GMT is an issuer for the purposes of the Financial Reporting Act 1993 and is listed on the New Zealand
                                                                                                                                  Amortisation of capitalised lease incentives                                          (1.5)         (2.5)         (1.3)
Stock Exchange (“NZX”). The principal activity of the Group is to invest in real estate in New Zealand.
                                                                                                                                  Fixed rental income adjustment                                                         0.8           1.8           1.0
The consolidated interim financial statements have been approved for issue by the Manager of the Trust on 5 November
                                                                                                                                  Rental income                                                                         56.5         110.4          54.3
2009. The Manager does not have the power to amend these financial statements once issued.
Summary of significant accounting policies                                                                                        No customers individually contribute greater than 10% of total rental revenue.
These interim financial statements for the six months ended 30 September 2009 have been prepared in accordance                    The above includes rental income of $4.3 million for the six months ended 30 September 2009 (year ended 31 March
with generally accepted accounting practice in New Zealand, International Accounting Standard 34 and New Zealand                  2009: $8.5 million; six months ended 30 September 2008: $4.3 million) in relation to certain assets at Highbrook Business
equivalent to International Accounting Standard 34, Interim Financial Reporting.                                                  Park and Westney Industry Park which are jointly controlled.
The accounting policies that materially affect the measurement of the Comprehensive Income Statement, the Balance
Sheet and the Cash Flow Statement have been applied on a basis consistent with those used in the audited financial                NOTE 3. Net service charge and property operating expenses
statements for the year ended 31 March 2009 and unaudited interim financial statements for the six months ended 30
September 2008, except as noted below for new standards and amendments adopted at 1 April 2009.                                                                                                                    Unaudited       Audited     Unaudited
The interim financial statements do not include all the notes of the type normally included in the annual financial statements.                                                                                     6 months    12 months       6 months
Accordingly, these consolidated interim financial statements are to be read in conjunction with the annual financial                                                                                               30 Sep 09    31 Mar 09      30 Sep 08
statements for the year ended 31 March 2009, prepared in accordance with New Zealand equivalents to International                                                                                                        $M             $M           $M
Financial Reporting Standards and International Financial Reporting Standards.                                                    Service charge income                                                                  9.9          19.2           9.7
The interim financial statements for the six months ended 30 September 2009 are unaudited. The interim financial                  Service charge expense                                                                (9.9)        (19.2)         (9.7)
statements are presented in New Zealand Dollars ($), which is the Trust’s functional currency. All financial information has      Property operating expenses                                                           (3.0)          (6.7)        (3.4)
been presented in millions, unless stated otherwise.                                                                              Net service charge and property operating expenses                                    (3.0)          (6.7)        (3.4)
Changes in accounting policies
                                                                                                                                  There are no material expenses from vacant property.
The following new standards and amendments have been adopted from 1 April 2009.
                                                                                                                                  The above includes property expenses of $0.6 million for the six months ended 30 September 2009 (year ended 31 March
NZ IAS 40, Investment property: This has resulted in development properties (including land) being measured at fair               2009: $1.1 million; six months ended 30 September 2008: $0.5 million) in relation to certain assets at Highbrook Business
value as opposed to cost. This brings the measurement of commenced but incomplete developments in line with that                  Park and Westney Industry Park which are jointly controlled.
of investment properties. This change has had no material impact on the financial statements as at 30 September 2009.
                                                                                                                                  The above property operating expenses also include non-recoverable ground rental costs of $1.2 million for the six months
NZ IAS 1 (revised), Presentation of financial statements: The revised standard prohibits the presentation of items of income      ended 30 September 2009 (year ended 31 March 2009: $2.1 million; six months ended September 2008 : $1.0 million).
and expense in the statement of changes in unitholders funds, requiring separate presentation from owner changes in
unitholder funds. All items of income and expense are required to be shown in the comprehensive income statement.                 The Group’s ground lease profile up to the next perpetual lease renewal date is as follows:
NZ IFRS 8, Operating segments: NZ IFRS 8 replaces NZ IAS 14, Segment reporting. It requires a management approach                                                                                                  Unaudited       Audited     Unaudited
under which segment information is presented on the same basis as that used for internal reporting purposes to the                                                                                                  6 months    12 months       6 months
Group’s chief operating decision maker. This has not resulted in a material change to the disclosures made in the financial                                                                                        30 Sep 09    31 Mar 09      30 Sep 08
statements.                                                                                                                                                                                                              $M            $M            $M
There have been no other changes in accounting policies during the current financial period. All other accounting policies        Less than one year                                                                     3.9           4.3           4.3
have been applied on a basis consistent with the prior half year and annual financial statements.                                 One to two years                                                                       3.9           4.3           4.3
Where necessary, comparative figures have been adjusted to conform with changes in presentation in the financial                  Two to five years                                                                     12.2          14.0          13.9
statements.                                                                                                                       More than five years                                                                  62.5          72.3          69.3
                                                                                                                                                                                                                        82.5          94.9          91.8




13                                                                                                                                Goodman Property Trust Interim Report 2009                                                                            14
notes to the interim financial statements                                                                               notes to the interim financial statements
continued                                                                                                               continued

for the six months ended 30 September 2009                                                                              for the six months ended 30 September 2009
NOTE 4. Profit/(loss) before income tax                                                                                 NOTE 4. Profit/(loss) before income tax continued
                                                                              Unaudited        Audited    Unaudited                                                                                 Unaudited        Audited    Unaudited
                                                                               6 months     12 months      6 months                                                                                  6 months     12 months      6 months
                                                                              30 Sep 09     31 Mar 09     30 Sep 08                                                                                 30 Sep 09     31 Mar 09     30 Sep 08
                                                                                    $M             $M           $M                                                                                        $M             $M           $M
Profit/(loss) before income tax has been arrived at                                                                     Losses on disposal of investment properties
after (charging)/crediting the following items:
                                                                                                                        Proceeds from sale of investment properties                                       26.6         50.6              -
Finance costs/income
                                                                                                                        Carrying value of investment properties sold                                     (29.0)       (50.8)             -
Interest income                                                                      0.1           0.4          0.2
                                                                                                                        Net loss on disposal of investment properties                                     (2.4)         (0.2)            -
Finance income                                                                       0.1           0.4          0.2
                                                                                                                        Net change in value of property investments
Bank loans, interest rate swaps and overdraft interest                             (22.7)       (40.3)        (21.6)
                                                                                                                        Fair value adjustment on investment properties                                   (22.0)      (131.6)        (49.4)
Amortisation of borrowing costs                                                     (0.3)         (0.6)            -
                                                                                                                        Impairment of development properties                                                  -       (41.2)         (7.6)
Interest rate swaps, cash flow hedges, transfer from equity                             -          2.4          4.1
                                                                                                                        Net change in value of property investments                                      (22.0)      (172.8)        (57.0)
Borrowing costs capitalised (refer to note 9)                                       12.4         28.7          14.6
                                                                                                                        Other administrative expenses
Finance costs                                                                      (10.6)         (9.8)        (2.9)
                                                                                                                        Auditors' fees                                                                    (0.1)         (0.2)        (0.1)
Amortisation of cash flow hedge reserve                                             (7.2)             -            -
                                                                                                                        Trustee fees and disbursements                                                    (0.1)         (0.2)        (0.1)
Net finance (costs)/income                                                         (17.7)         (9.4)        (2.7)
                                                                                                                        Manager's base fee                                                                (2.6)         (5.3)        (2.6)
At 1 April 2009 the Group ceased hedge accounting under NZ IAS 39 Financial Instruments: Recognition and Measurement.   Manager's performance fee                                                             -             -            -
This has resulted in movements in the fair value of derivative financial instruments being recognised directly in the   Other                                                                             (0.8)         (1.6)        (0.8)
comprehensive income statement as opposed to previously deferred in equity and then released to the income statement    Other administrative expenses                                                     (3.6)         (7.3)        (3.6)
in line with the hedged item. Amounts previously being deferred in equity will be released through the comprehensive
income statement over the remaining term of the original hedging relationship.
                                                                                                                        Fees paid to auditors by the Group for other assurance and advisory services for the six months ended 30 September
                                                                                                                        2009 were $7,600 (year ended 31 March 2009: $30,250; six months ended 30 September 2008: $Nil). These reported
                                                                                                                        amounts are expressed in whole dollars.




15                                                                                                                      Goodman Property Trust Interim Report 2009                                                                      16
notes to the interim financial statements                                                                    notes to the interim financial statements
continued                                                                                                    continued

for the six months ended 30 September 2009                                                                   for the six months ended 30 September 2009

NOTE 5. Taxation                                                                                             NOTE 5. Taxation continued
                                                                    Unaudited       Audited    Unaudited                                                                                  Unaudited           Audited    Unaudited
                                                                     6 months    12 months      6 months                                                                                   6 months        12 months      6 months
                                                                    30 Sep 09    31 Mar 09     30 Sep 08                                                                                  30 Sep 09        31 Mar 09     30 Sep 08
                                                                          $M            $M           $M                                                                                         $M                $M           $M
Income tax (expense)/benefit                                                                                 b) Deferred tax recognised directly in equity
Current tax expense                                                                                          Relating to interest rate swaps                                                           -        15.1          (2.4)
Current period                                                           (1.3)         (3.5)        (0.5)                                                                                              -        15.1          (2.4)
Adjustment for prior periods                                                 -          1.5             -    c) Reconciliation of current tax expense to tax deducted
                                                                         (1.3)         (2.0)        (0.5)       from distributable earnings
Deferred tax (expense)/benefit recognised in the income statement                                            Current tax expense                                                                (1.3)            (3.5)        (0.5)
Movements in deferred tax                                                (4.9)        11.6           1.6     Less: Tax losses generated outside GMT tax group                                   (0.9)            (2.3)        (1.7)
                                                                         (4.9)        11.6           1.6     Less: Tax impact of performance fee                                                    -                -            -
Total                                                                    (6.2)         9.6           1.1     Add: Current tax expense funded through brought forward tax losses                  0.2              0.5          0.3
a) Income tax (expense)/benefit                                                                              Add: Depreciation recovered on properties sold                                      1.1              1.0             -
Profit/(loss) before tax                                                 19.4        (83.7)        (12.3)    Add: Over provision in respect of prior period                                         -             1.1             -
Prima facie income tax (expense)/benefit calculated                      (5.8)        25.1           3.7     Tax deducted from distributable earnings                                           (0.9)            (3.2)        (1.9)
at 30% on the profit/(loss) before tax                                                                       The corporate tax rate in NZ was changed from 33% to 30% with effect from 1 April 2008.
Increase/(decrease) in income tax due to:
 - loss on realisation of investment property                            (0.7)         (0.1)             -
 - revaluation of property investments                                   (6.6)       (51.8)        (17.1)
 - holding costs capitalised                                              3.8           9.3           4.6
 - deductible capital expenditure                                         0.9           2.1           1.0
 - fair value change on interest rate derivatives                         3.5              -             -
 - amortisation of cash flow hedge reserve                               (2.2)             -             -
 - other                                                                  0.1           0.4           0.2
 - depreciation                                                           5.0         10.6            5.8
 - deferred leasing costs and incentives                                  0.7           0.9           1.3
Current tax expense                                                      (1.3)         (3.5)         (0.5)
 - building component of investment property revaluation                  3.3         33.6            8.7
 - depreciation                                                          (5.0)       (10.6)          (5.8)
 - deferred leasing costs and incentives                                 (0.7)         (0.9)         (1.3)
 - fair value change on interest rate derivatives                        (3.5)             -             -
 - holding costs capitalised on buildings                                (0.9)         (7.7)             -
 - deductible capital expenditure                                        (0.9)         (2.1)             -
 - amortisation of cash flow hedge reserve                                2.2              -             -
 - other                                                                  0.6          (0.7)             -
Deferred tax (expense)/benefit                                           (4.9)        11.6            1.6
                                                                         (6.2)          8.1           1.1
Over provision in prior period                                               -          1.5              -
Income tax (expense)/benefit attributable to profit                      (6.2)          9.6           1.1
from ordinary activities




17                                                                                                           Goodman Property Trust Interim Report 2009                                                                          18
notes to the interim financial statements                                                                                    notes to the interim financial statements
continued                                                                                                                    continued

for the six months ended 30 September 2009                                                                                   for the six months ended 30 September 2009
NOTE 6. Earnings per unit                                                                                                    NOTE 7. Cash flow statement
                                                                                  Unaudited        Audited     Unaudited                                                                            Unaudited      Audited    Unaudited
                                                                                   6 months     12 months       6 months                                                                            30 Sep 09    31 Mar 09    30 Sep 08
                                                                                  30 Sep 09     31 Mar 09      30 Sep 08                                                                                  $M           $M           $M
                                                                                      cents          cents         cents     a) Cash and cash equivalents
Attributable to unitholders of Goodman Property Trust                                                                        Deposits                                                                     0.9          1.9          2.4
Basic and diluted earnings per unit                                                     1.56         (8.84)         (1.35)   Cash                                                                         1.4          1.5          1.4
Distributable earnings before tax per unit (1)                                          4.65         10.38           5.34    Total cash and cash equivalents                                              2.3          3.4          3.8
Distributable earnings after tax per unit (2)                                           4.54         10.00           5.11    b) Reconciliation of profit/(loss) after income tax
                                                                                                                                 to net cash flows from operating activities
                                                                                                                             Profit/(loss) for the period                                                13.2        (74.1)       (11.3)
                                                                                  Unaudited        Audited     Unaudited     Non cash items
                                                                                   6 months     12 months       6 months     Items classified as investing/financing activities:
                                                                                  30 Sep 09     31 Mar 09      30 Sep 08     Net change in value of property investments                                 22.0        172.8         57.0
                                                                                      000’s          000’s         000’s
                                                                                                                             Loss on sale of investment property                                          2.4          0.2            -
Weighted average number of units used in calculating earnings                       847,435       838,798        835,755
                                                                                                                             Fair value gains on interest rate swaps not in hedging relationships       (11.6)        (2.3)           -
per unit and distribution per unit
                                                                                                                             Amortisation of cash flow hedge reserve                                      5.0             -           -
                                                                                                                             Other:
                                                                                                                             Deferred tax                                                                 6.3        (14.0)        (1.6)
                                                                                  Unaudited        Audited     Unaudited
                                                                                                                             Net cash provided by operating activities                                   37.3         82.6         44.1
                                                                                   6 months     12 months       6 months
                                                                                                                             before change in assets and liabilities
                                                                                  30 Sep 09     31 Mar 09      30 Sep 08
Profit/(loss) after tax used in calculating earnings per unit                            $M             $M            $M     Change in assets and liabilities during the period:
Profit/(loss) after tax used in calculating basic and diluted earnings per unit        13.2          (74.1)        (11.3)    - Decrease in trade receivables                                              1.6          0.8          1.3
Add: Net change in value of property investments                                       22.0          172.8          57.0     - (Decrease)/increase in current tax liabilities                            (0.2)         1.1             -
Add: Loss on disposal of investment property                                             2.4            0.2              -   - Decrease in current tax assets                                                -         2.2          0.5
Less: Fair value gain on interest rate swaps                                          (11.6)           (2.3)             -   - (Increase)/decrease in other assets                                       (0.7)         0.9         (2.7)
Add: Amortisation of cash flow hedge reserve                                             7.2               -             -   - (Decrease)/increase in trade payables                                     (0.7)         0.2             -
Add/(less): Income tax expense/(benefit)                                                 6.2           (9.6)         (1.1)   - Increase/(decrease) in other payables                                      0.9         (0.3)        (0.1)
(1)
    Profit used in calculating distributable earnings before tax per unit              39.4           87.0          44.6     Net cash inflow from operating activities                                   38.2         87.5         43.1
Less: Current tax expense                                                               (1.3)          (3.5)         (0.5)
Less: Tax losses generated outside of GMT Tax Group                                     (0.9)          (2.3)         (1.7)
Less: Tax impact of performance fee                                                         -              -             -
Add: Current tax expense funded through brought forward tax losses                       0.2            0.5           0.3
Add: Depreciation recovered on properties sold                                           1.1            1.0              -
Add: Under-provision in respect of prior year tax balances                                  -           1.1              -
(2)
    Profit used in calculating distributable earnings after tax per unit               38.5           83.8          42.7




19                                                                                                                           Goodman Property Trust Interim Report 2009                                                               20
notes to the interim financial statements                                                                               notes to the interim financial statements
continued                                                                                                               continued

for the six months ended 30 September 2009                                                                              for the six months ended 30 September 2009
NOTE 8. Trade and other receivables                                                                                     NOTE 9. Investment properties and development properties continued

                                                                              Unaudited       Audited    Unaudited                                                                                       Unaudited     Audited   Unaudited
                                                                              30 Sep 09     31 Mar 09    30 Sep 08                                                                                       30 Sep 09   31 Mar 09   30 Sep 08
                                                                                    $M            $M           $M                                                                                              $M          $M          $M
Current                                                                                                                 The Gate Industry Park, Penrose                                                      127.4       124.3       126.7
Trade receivables                                                                    0.2          1.8           1.1     Highbrook Business Park, East Tamaki (50%)                                           124.4       102.5        76.7
Prepayments                                                                          2.0          0.7           1.6     Highbrook Business Park, East Tamaki (75% interest - jointly controlled asset)       108.0       108.0       113.2
Other assets                                                                         5.6          5.2           5.4     Central Park Corporate Centre, Greenlane                                             106.2       114.1       124.4
Property disposal settlements receivable                                            26.6         12.1             -     Westney Industry Park, Mangere                                                       105.3       107.1        86.3
                                                                                    34.4         19.8           8.1     Savil Link, Otahuhu                                                                   71.7        53.0        54.5
                                                                                                                        Viaduct Corporate Centre, Auckland (50%)                                              70.3        70.2        74.3
For the six months ended 30 September 2009 the amount of trade receivables past due but not impaired was $0.2 million   Millennium Centre, Phase II, Greenlane                                                70.0        70.0        72.5
(31 March 2009: $1.8 million; 30 September 2008: $1.1 million).
                                                                                                                        M20 Business Park (formerly Auckland Distribution Centre), Manukau                    64.6        64.4        55.9
                                                                                                                        Air New Zealand House, Auckland                                                       56.9        56.9        60.0
NOTE 9. Investment properties and development properties                                                                Millennium Centre, Greenlane                                                          54.5        58.1        58.5
Investment property                                                                                                     Enterprise Park, Manukau                                                              44.6        44.6        44.5
All investment properties were valued by independent valuers as at 31 March 2009. At 30 September 2009, all             Connect Business Park, Penrose                                                        44.1        43.0        45.6
investment properties have been subject to a valuation review to ensure that they continue to be held at fair value.    Show Place Office Park, Christchurch (50%)                                            42.2        42.1        37.9
The valuation review comprised a review of recent comparable transactional evidence of market sales and leasing
                                                                                                                        Penrose Industrial Estate, Penrose                                                    37.2        39.4        41.5
activity. The fair value of the properties were determined by the Manager using market data provided by independent
valuers and based on independent valuation advice. The fair values are based on market values, which are estimated      Yellow HQ, Greeenlane                                                                 33.1        32.4           -
using the capitalisation and discounted cash flow methods described in the accounting policies of the full financial    Aurecon House (formerly The Connell Wagner Building), Newmarket1                      25.3        28.5        31.0
statements for the year ended 31 March 2009.                                                                            Gateside Industry Park, Penrose                                                       22.9        22.7        24.0
Valuations reflect, where appropriate: the quality of customers in occupation, or responsible for meeting lease         Southpark Industrial Estate, Christchurch                                             21.2        21.0        22.2
commitments or likely to be in occupation after letting vacant accommodation, and the market’s general perception       Glassworks Industry Park, Christchurch                                                20.5        20.5        21.1
of their creditworthiness; the allocation of maintenance and insurance responsibilities between the Group and the       OnGas House, Newmarket                                                                18.7        20.0        21.0
customer; and the remaining economic life of the property. When rent reviews or lease renewals are pending with
                                                                                                                        Vector Centre, Newmarket                                                              17.4        19.3        20.0
anticipated reversionary increases, it is assumed that all notices and where appropriate counter-notices have been
served validly and within the appropriate time.                                                                         120 Pavilion Drive, Airport Oaks                                                       8.3         8.2         9.0
                                                                                                                        Pernod Ricard NZ House, Auckland                                                         -        27.5        29.0
                                                                                                                        APN News and Media Building, Manukau                                                     -           -        12.8
                                                                                                                        Fivestar Distribution Centre (formerly Nesdale House), Manukau                           -           -        11.7
                                                                                                                        Hawkins House, Parnell                                                                   -           -        11.1
                                                                                                                        Ricoh Building, Parnell                                                                  -           -        10.5
                                                                                                                        Total fair value of investment properties                                          1,294.8     1,297.8     1,295.9
                                                                                                                        1
                                                                                                                          Property held for sale




21                                                                                                                      Goodman Property Trust Interim Report 2009                                                                      22
notes to the interim financial statements                                                                                notes to the interim financial statements
continued                                                                                                                continued

for the six months ended 30 September 2009                                                                               for the six months ended 30 September 2009
NOTE 9. Investment properties and development properties continued                                                       NOTE 11. Issued units

                                                                              Unaudited        Audited    Unaudited      Reconciliation of movements in                      Unaudited               Audited               Unaudited
                                                                              30 Sep 09      31 Mar 09    30 Sep 08      Goodman Property Trust units                        30 Sep 09              31 Mar 09              30 Sep 08
                                                                                    $M             $M           $M                                                    No. of units     Value No. of units     Value No. of units     Value
Development property                                                                                                                                                         000s        $M         000s        $M         000s        $M
Commenced developments                                                                                                   Balance at the beginning of the period          845,341       975.2    833,691       962.8    833,691       962.8
Highbrook Business Park, East Tamaki (50%)                                            2.1         16.6          33.2     Movements during the period
Savill Link, Otahuhu                                                                    -         12.0             -     Issue of units pursuant to distribution              7,938            7.0    11,650          12.4        7,356         8.7
Show Place Business Park, Christchurch (50%)                                            -          0.9           2.7     reinvestment scheme
Westney Industrial Park, Mangere                                                      0.7          0.7          17.3     Balance at the end of the period                 853,279           982.2    845,341         975.2     841,047        971.5
604 and 606-612 Great South Road, Greenlane                                             -            -          21.8
                                                                                                                         Units have no par value. All units are fully paid.
The Gate Industry Park, Penrose                                                       0.9            -             -
M20 Business Park, Manukau                                                            3.9            -          12.2                                                                                           Unaudited       Audited    Unaudited
                                                                                      7.6         30.2          87.2                                                                                           30 Sep 09     31 Mar 09    30 Sep 08
                                                                                                                                                                                                                   cents         cents        cents
Development land
                                                                                                                         Net tangible assets per unit                                                              102.9         105.6        120.7
Highbrook Business Park, East Tamaki (50%)                                          85.1          77.7          84.9
                                                                                                                         Adjusted net tangible assets per unit (1)                                                 103.5         107.4        123.1
M20 Business Park, Manukau                                                          31.0          31.6          36.3
Savill Link, Otahuhu                                                                29.5          29.9          33.5
Central Park Corporate Centre, Greenlane                                            20.8          19.8          20.0
Glassworks Industry Park, Christchurch                                              13.6          12.6          14.5                                                                                           Unaudited       Audited    Unaudited
                                                                                                                                                                                                               30 Sep 09     31 Mar 09    30 Sep 08
Gateside Industry Park, Penrose                                                      8.5           8.1           8.3
                                                                                                                                                                                                                     $M            $M           $M
Show Place Business Park, Christchurch (50%)                                         3.4           2.4           6.5
                                                                                                                         Net tangible assets                                                                       878.3         892.3      1,015.4
Connect Business Park, Penrose                                                       1.1           1.0           1.7
                                                                                                                         Deferred tax (asset)/liability attributable to revaluation of buildings                   (14.1)        (10.8)        14.1
APN News and Media Building, Manukau                                                   -             -           2.1
                                                                                                                         Derivative financial instruments liability/(asset) net of tax                              18.8          26.4          6.0
The Gate Industry Park, Penrose                                                      1.1           1.6           1.2     (1)
                                                                                                                             Adjusted net tangible assets                                                          883.0         907.9      1,035.5
                                                                                   194.1         184.7         209.0
Total carrying value of development properties                                     201.7         214.9         296.2
                                                                                                                         NOTE 12. Investments in jointly controlled entities
Interest costs capitalised during the six month period to 30 September 2009 amounted to $12.4 million (31 March 2009:
$28.7 million; 30 September 2008 $14.6 million), using a weighted average capitalised interest rate of 7.28% (31 March   Jointly controlled entity                        Principal activity                        Interest held by Group
2009: 8.28%; 30 September 2008: 8.92%).                                                                                                                                                                        30 Sep 09    31 Mar 09    30 Sep 08
                                                                                                                         Viaduct Corporate Centre Limited                Property investment                        50%           50%         50%
                                                                                                                         Henshaw Holdings Limited                        Property investment                        50%           50%         50%
NOTE 10. Trade and other payables
                                                                                                                         Highbrook Development Limited                   Property investment                        50%           50%         50%
                                                                              Unaudited        Audited    Unaudited
                                                                              30 Sep 09      31 Mar 09    30 Sep 08      The jointly controlled companies are incorporated in New Zealand and have balance dates of 31 March.
                                                                                    $M             $M           $M
Current
Trade payables                                                                        0.6          1.7           1.0
Other payables                                                                       17.0         18.5          16.9
Accrued capital expenditure                                                             -          0.2          10.3
Capital expenditure accruals on completed developments                                9.4         16.6             -
                                                                                     27.0         37.0          28.2




23                                                                                                                       Goodman Property Trust Interim Report 2009                                                                              24
notes to the interim financial statements                                                                                         notes to the interim financial statements
continued                                                                                                                         continued

for the six months ended 30 September 2009                                                                                        for the six months ended 30 September 2009
NOTE 13. Commitments and contingencies                                                                                            NOTE 15. Related party disclosures continued
As at 30 September 2009, the Group had $0.6 miilion of material capital commitments relating to development properties            The table below shows the amount of compensation by category paid to key management personnel of the Manager and
(31 March 2009: $9.3 million; 30 September 2008: $39.5 million). Included in GMT’s capital commitments above are $0.3             does not represent costs incurred by the Group:
million of capital commitments relating to Highbrook Development Limited (31 March 2009: $6.3 million; 30 September
2008: $6.4 million). GMT has no capital commitments in relation to its interests in the Highbrook joint venture assets. GMT                                                                                        Unaudited        Audited     Unaudited
is liable for an additional amount payable of $5.0 million in respect of land aquired at Central Park in the event of re-zoning                                                                                    30 Sep 09      31 Mar 09     30 Sep 08
of that property.                                                                                                                                                                                                        $M             $M            $M
GMT has incurred no material contingent liabilities in relation to its interests in jointly controlled entities.                  Short term benefits                                                                    0.6            1.5           0.9
                                                                                                                                  Post-employment benefits                                                                 -            0.1             -
                                                                                                                                  Other long term benefits                                                                 -              -             -
NOTE 14. Events subsequent to balance date
                                                                                                                                  Termination benefits                                                                     -              -             -
On 6 October 2009, the sale of the Pernod Ricard House, 4 Viaduct Harbour Avenue, Auckland settled for a total                    Share-based payment                                                                    0.1            0.2           0.1
consideration of $26.6 million.
                                                                                                                                  Total                                                                                  0.7            1.8           1.0
On 15 October 2009, GMT entered into an unconditional sale agreement for Aurecon House, 139 Carlton Gore Road,
Auckland for a total consideration of $26.7 million.                                                                              (b) Entities with significant influence over GMT
On 5 November 2009 a cash distribution of 2.125 cents with imputation credits of 0.06 cents attached, was declared                Fees for property management and development management services of $3.0 million were payable by GMT to GPSNZ
to unitholders who are on GMT’s register at 3 December 2009. This distribution has not been recognised in the financial           during the period (31 March 2009: $7.8 million; 30 September 2008: $3.7 million). Of this amount:
statements.
                                                                                                                                  - $0.7 million was in respect of development management fees and was capitalised to properties (31 March 2009: $3.4
On 5 November 2009, GMT announced that it is considering an issue of senior secured bonds to raise $100 million with              million; 30 September 2008: $1.9 million). A significant portion of the property management fees are paid by customers.
up to $50 million in over subscriptions available.
                                                                                                                                  - $203,449 was payable by GMT pursuant to the property management and development management agreements
                                                                                                                                  between Highbrook Business Park Limited and GPSNZ (31 March 2009: $208,745; 30 September 2008: $176,131),
NOTE 15. Related party disclosures                                                                                                being 75% of the total fees of $271,332 payable under these agreements for the year (such disclosure required by
                                                                                                                                  paragraph 46(c) of the NZX waiver dated 1 March 2006); and
Identity of related parties
                                                                                                                                  - $123,211 was payable by GMT pursuant to the property management and development management agreements
The Group has related party relationships with the following parties:
                                                                                                                                  between Highbrook Development Limited and GPSNZ (31 March 2009: $147,011; 30 September 2008: $75,605), being
Entity                                                            Nature of relationship                                          50% of the total fees of $246,222 payable under these agreements for the year (such disclosure required by paragraph
                                                                                                                                  60(c) of the NZX waiver dated 7 November 2007).
Goodman Limited - parent and controlled                                                                                           For the period ended 30 September 2009: $0.3 million was owing to GPSNZ (31 March 2009: $1.1 million; 30 September
entities including, amongst others, the following:                                                                                2008: $0.7 million). Reimbursement of expenses was made to GPSNZ of $0.4 million (31 March 2009: $0.9 million; 30
Goodman (NZ) Limited (“GNZ”)                                      Manager of the Trust                                            September 2008: $0.4 million).
                                                                                                                                  During the period no properties were acquired from Goodman Industrial Trust (31 March 2009: $7.8 million; 30 September
Goodman Property Services (NZ) Limited (“GPSNZ”)                  Provider of property management and related services
                                                                                                                                  2008: $4.4 million).
Goodman Industrial Trust                                          Unitholder and property co-ownership                            No properties were acquired in the current year pursuant to the Co-ownership Agreement between GMT and Goodman
                                                                                                                                  Industrial Trust (formerly Macquarie Goodman Industrial Trust), approved by unitholders at a general meeting held on 23
(a) Compensation to key management personnel                                                                                      March 2004 (31 March 2009: none; 30 September 2008: none).
Key management personnel are those people with the responsibility and authority for planning, directing and controlling the
activities of the entity. As the Trust does not have any employees or Directors, key management personnel is considered           NOTE 16. Segment reporting
to be the Manager, Goodman (NZ) Limited (“GNZ”) and the key management personnel of the Manager. Management fees
of $3.3 million were payable to GNZ during the period (31 March 2009: $6.9 million; 30 September 2008: $3.4 million). Of          The chief operating decision-maker has been identified as the Board of Directors of Goodman (NZ) Limited. The board
these fees, none was payable in respect of the performance fee for the period ended 30 September 2009 (performance                reviews the group’s internal reporting in order to assess performance and allocate resources. Management has determined
fee element 31 March 2009: $nil; 30 September 2008: $nil). A deficit amount of $5.4 million (31 March 2009: deficit $5.4          the operating segments based on these reports.
million; 30 September 2008; surplus $9.7 million) has been carried forward to be included in the calculation to determine         The board considers and monitors the business at an individual property level. Due to the similar economic characteristics
whether a performance fee is payable in subsequent periods.                                                                       exhibited by the properties, management considers there to only be one reporting segment being New Zealand commercial
These payments were in accordance with the Trust Deed. At 30 September 2009, $0.6 million was owing to GNZ                        real estate.
(31 March 2009: $0.6 million; 30 September 2008: $0.6 million). No reimbursements of expenses were made to GNZ
(31 March 2009: $nil; 30 September 2008: $nil).
Directors of GNZ and their immediate relatives hold either directly or indirectly 0.36% (31 March 2009: 1.09%;
30 September 2008: 1.3%) of the units of the Trust.

25                                                                                                                                Goodman Property Trust Interim Report 2009                                                                             26
accountants’ report                                                                                                           regulatory disclosures


To the unitholders of Goodman Property Trust.                                                                                 This information is required to be included in this Interim Report as a condition to the waivers from Listing Rules 4.2.3 and
                                                                                                                              9.2.1 granted to GMT by NZX on 4 March 2005 and 15 June 2007 respectively.

We have reviewed the interim financial statements (“financial statements”) on pages 9 to 26. The financial statements         Relationship between the Trust and Goodman Group
provide information about the past financial performance and cash flows of the Group for the six months ended 30              The Trust has a close working relationship with Goodman Group. Goodman Group is the Trust’s largest Unitholder, owning
September 2009 and its financial position as at that date. This information is stated in accordance with the accounting       approximately 16.9% of Units on issue at the Balance Date.
policies set out on page 13.                                                                                                  The Manager of the Trust, Goodman (NZ) Limited, is a wholly owned subsidiary of Goodman Group, and has played the
Manager’s responsibilities                                                                                                    role of Manager since late 2003. The Manager’s role is to strategically manage the Trust’s property portfolio including
The Directors of Goodman (NZ) Limited (the “Manager”) are responsible for the preparation and presentation of the financial   buying and selling properties, managing capital and overseeing day to day operations. Goodman Group’s cornerstone
statements that present fairly the financial position of the Group as at 30 September 2009 and its financial performance      stake brings into close alignment the interests of the Trust and the Manager.
and cash flows for the six months ended on that date.                                                                         Goodman Group also provides certain other services to the Trust which are outside the scope of the Manager’s duties,
Accountants’ responsibilities                                                                                                 which relate to property services, development and project management services, legal services and internal audit services.

We are responsible for reviewing the financial statements presented by the Manager in order to report to you whether, in      The Trust and Goodman Group have also transacted property from time to time, either between each other or jointly
our opinion and on the basis of the procedures performed by us, anything has come to our attention that would indicate        pursuant to the Co-ownership Agreement, which is explained in more detail below.
that the financial statements do not present fairly the matters to which they relate.                                         Summary of Co-ownership Agreement between the Trust and Goodman Group
Basis of opinion                                                                                                              Goodman Group and the Trust are parties to the Co-ownership Agreement, pursuant to which they own, and can buy or
A review is limited primarily to enquiries of company personnel and analytical review procedures applied to financial         sell, certain properties on a 50/50 basis.
data and thus provides less assurance than an audit. We have not performed an audit on the financial statements and,          Listing Rule 9.2.1 regulates Related Party transactions, requiring Unitholder approval of any transaction involving both
accordingly, we do not express an audit opinion.                                                                              the Trust and Goodman Group (which are Related Parties) where the value of the transaction exceeds 10% of the Trust’s
We have reviewed the financial statements of the Group for the six months ended 30 September 2009 in accordance with          average market capitalisation. Prior to April 2009, when the Listing Rules were amended, this threshold was only 5%.
the Review Engagement Standards issued by the New Zealand Institute of Chartered Accountants.                                 Accordingly, Listing Rule 9.2.1 previously required (prior to the amendment noted above) that many transactions entered
We have no relationship with or interests in the Group other than in our capacities as accountants conducting this review     into pursuant to the Co-ownership Agreement, whereby the Trust and Goodman Group would acquire or dispose of
and the providers of assurance (including audit) services.                                                                    property as 50/50 Co-owners to, or from, an unrelated third party, and having a value exceeding 5% of the Trust’s average
                                                                                                                              market capitalisation (“Qualifying Transaction”), would require Unitholder approval.
Review opinion
                                                                                                                              With the increase of the Related Party transaction threshold under Listing Rule 9.2.1 to 10% of an issuer’s average market
We have reviewed the financial performance and cash flows of the Group for the six months ended 30 September 2009             capitalisation, a Qualifying Transaction is now one where:
and its financial position as at that date.
                                                                                                                              (a) the Trust and Goodman Group are either acquiring or disposing of a property as 50/50 Co-owners to, or from, an
Based on our review, nothing has come to our attention that causes us to believe that the financial statements do not             unrelated third party; and
present fairly the financial position of the Group as at 30 September 2009 and its financial performance and cash flows
for the six months ended on that date in accordance with both International Accounting Standard 34 and New Zealand            (b) the value of the transaction exceeds 10% of the Trust’s average market capitalisation.
equivalent to International Accounting Standard 34, Interim Financial Reporting.                                              The policy or intent behind Listing Rule 9.2.1 is that a party with influence over the Trust should be prevented from exerting
Our review was completed on 5 November 2009 and our review opinion is expressed as at that date.                              that influence to procure the entry by the Trust into a transaction with a Related Party and thereby unfairly transferring value
                                                                                                                              from the Trust to the Related Party.
                                                                                                                              In relation to a Qualifying Transaction, though, the Trust and Goodman Group are on the same side of the transaction,
                                                                                                                              meaning their interests are aligned. This overcomes the risk of value leakage of the manner described above. A Qualifying
                                                                                                                              Transaction therefore wouldn’t breach the intent of Listing Rule 9.2.1.
                                                                                                                              On this basis, NZX Regulation granted a waiver (“Waiver”) on 3 December 2004 (extended on 15 June 2007 until 3
                                                                                                                              December 2010) from Listing Rule 9.2.1, to the extent that Rule would require Unitholder approval to be obtained for any
                                                                                                                              Qualifying Transaction.
Chartered Accountants
                                                                                                                              The Waiver is conditional upon, amongst other things, Unitholders (excluding Goodman Group and its Associated Persons)
Auckland                                                                                                                      annually approving by Ordinary Resolution the Trust’s entry into future Qualifying Transactions. No such resolution has yet
                                                                                                                              been sought for the year ending 31 March 2010.
                                                                                                                              As indicated above, the recent amendements to the Listing Rules mean that a transaction pursuant to the Co-ownership
                                                                                                                              Agreement only needs to rely on the Waiver and comply with it’s terms where the transaction has a value exceeding 10%
                                                                                                                              of the Trust’s average market capitalisation.




27                                                                                                                            Goodman Property Trust Interim Report 2009                                                                                   28
regulatory disclosures                                                                                                           regulatory disclosures
continued                                                                                                                        continued

A summary of the principal rights and obligations of each of the Trust and Goodman Group (the “Co-owners”) in relation           In each case noted above where the market value of a property is relevant, that value will be assessed on the basis of an
to the Co-ownership Agreement, is set out below:                                                                                 arm’s length sale between a willing seller and a willing buyer and, where the relevant property forms part of a larger estate,
(1) Sharing of income and expenses equally                                                                                       on the basis that it is part of such estate. If market value cannot be agreed, it will be determined by an independent valuer.

     The Trust and Goodman Group must share equally the income and the expenses arising from, and incurred in respect            While the Trust has acquired Goodman Group’s interest in Co-owned Properties from time to time, often after a customer
     of, the Co-owned Properties.                                                                                                has signed an Agreement to Lease for a new facility to be built on the Co-owned Property, the Trust has no general
                                                                                                                                 acquisition entitlement. However, there are limited circumstances where the Trust has acquired Goodman Group’s interest
(2) No acquisition of New Zealand property individually without consent                                                          in a Co-owned Property following a customer commitment and the Agreement to Lease has also granted the customer
     Neither the Trust nor Goodman Group can separately acquire property in New Zealand without first offering to the            a right to expand its facility at some point in the future, with the expansion land remaining a Co-owned Property. In these
     other Co-owner a right to jointly buy the property under the Co-ownership Agreement.                                        instances, the Trust has agreed with Goodman Group to buy its interest in the expansion land if the customer exercises
     Where it is agreed that a transaction will not be pursued for inclusion in the Co-ownership Agreement, the Co-owner         its expansion right, on completion of the expansion works. Agreements of this nature are considered on a case by case
     that sourced the opportunity may pursue it individually.                                                                    basis by the Trust and Goodman Group.

(3) Pre-emptive rights and restrictions on sale                                                                                  It is a further condition of the waiver from LR 4.2.3 that the value of the Trust’s interest in the Co-owned Property may not
                                                                                                                                 exceed 35% of the value of the Trust’s assets.
     The Co-ownership Agreement includes the pre-emptive rights and restrictions on sale set out below.
                                                                                                                                 The Trust has not entered into any transactions with Goodman Group under the Co-ownership Agreement, nor has it
     (i) Removal of Manager or change in control of Goodman Group                                                                entered into any “Material Transaction” (as that term is defined in the Listing Rules) with Goodman Group, during the six
         In the event that either the Manager is removed involuntarily as Manager of the Trust, or more than 50% of              month period ended 30 September 2009.
         Goodman Group comes under the control of a person or group of associated persons, then the Trust may acquire
         Goodman Group’s interest in all Co-owned Properties. If the Trust chooses not to buy, Goodman Group may
         acquire the Trust’s interest in all Co-owned Properties and any “Balance Land” (where a Co-owned Property forms
         part of a larger estate where the remainder of the land at that estate is owned by the Trust, that remaining land is
         referred to here as “Balance Land”).
         Any of these sale scenarios must take place at market value for the assets transferred.
     (ii) Disposal to third parties
         Goodman Group may not dispose of its interest in the Co-owned Properties to a third party unless it disposes of
         the whole of its interest in all of the Co-owned Properties. The Trust on the other hand may elect to dispose of its
         interest in any or all of the Co-owned Properties to a third party, but in so doing must also dispose of its interest
         in any Balance Land.
         In each case above, the non-selling Co-owner has a right of pre-emption if the other is looking to sell. However, if
         this is not exercised, the non-selling Co-owner has a “tag” right, meaning the third party purchaser must also offer
         to purchase the non-selling Co-owner’s interest in the Co-owned Properties proposed to be acquired, together
         with, where the Trust is the non-seller, the Trust’s interest in any Balance Land.
         The Trust may not dispose of any Balance Land without also disposing of its interest in the Co-owned Property
         forming part of the same estate.
     (iii) Default under Co-ownership Agreement
         In the event of any default pursuant to the Co-ownership Agreement (including insolvency), the non-defaulting
         Co-owner can require either that the defaulting Co-owner sell its interest in the Co-owned Properties to the non-
         defaulting Co-owner, or that both Co-owners’ interests in the Co-owned Properties be sold to a third party.
         The terms of any sale to a third party must be considered reasonable by the Co-owners’ property manager and
         must, unless otherwise agreed, be for a purchase price of not less than 90% of the market value of the properties
         sold. In each case, if the Trust sells its interest in the Co-owned Properties it must also sell its interest in any
         Balance Land.
     (iv) Disagreement or dispute
         In the event that the Co-owners are unable to agree on a material issue under the Co-ownership Agreement, either
         Co-owner can offer to purchase the other’s interest in all of the Co-owned Properties. If no such offer is made, or
         an offer is made but not accepted, all of the Co-owned Properties must be sold to a third party. The terms of sale
         must be considered reasonable by the Co-owners’ property manager and must, unless otherwise agreed, be for
         a purchase price of not less than 90% of the market value of the properties sold. Where the Trust’s interest in the
         Co-owned Properties is being sold in these circumstances, its interest in any Balance Land must be sold with it.




29                                                                                                                               Goodman Property Trust Interim Report 2009                                                                                 30
investor relations                                                                                                                   glossary


Ensuring Unitholders are well informed and easily able to manage their investment in GMT is a key priority of the Manager’s          $ and cents                 means New Zealand currency.
investor relations team. Regular meetings and communications, GMT’s website and a dedicated toll free contact number
                                                                                                                                     ASX                         means ASX Limited or any market operated by it, as the context requires.
provide investors with the means to make informed decisions.
                                                                                                                                     Balance Date                means 30 September 2009.
Annual meeting
                                                                                                                                     Board                       means the Board of Directors of the Manager.
GMT’s Trust Deed requires at least one general meeting of Unitholders each financial year. The last Annual General Meeting
                                                                                                                                     Co-ownership Agreement      means the agreement of that name between the Manager, Goodman Property
was held on 5 August 2009 and the address and presentation from that meeting can be found on GMT’s website.
                                                                                                                                                                 Aggregated Limited, the Trustee, Goodman Funds Management Limited as responsible
Publications and website                                                                                                                                         entity of Goodman Industrial Trust, Tallina Pty Limited as trustee of Penrose Trust,
Annual and Interim Reports are typically mailed to Unitholders in June and December of each year respectively. Portfolio                                         and Trust Company Limited as custodian of Tallina Pty Limited, dated 1 April 2004 as
Update brochures detailing the performance of the Trust over the intervening periods are mailed in September and March.                                          amended by the Restructuring Agreement between the same parties dated 7 March
                                                                                                                                                                 2005, relating to the buying, selling and holding of property by the Trust and Goodman
GMT’s website, www.goodman.com/gmt, enables investors to view information about their unitholding, download investor                                             Group in 50/50 shares.
forms, check Unit prices and view publications and announcements.
                                                                                                                                     Directors                   means the directors of the Manager which, at the date of this report, are Greg Goodman
Investor helpline                                                                                                                                                and James Hodgkinson and the Independent Directors.
The Manager has a dedicated toll free number, 0800 000 656 (+64 9 375 6073 outside New Zealand), which will connect                  DRP                         means the distribution reinvestment plan for the Trust in operation from time to time.
Unitholders directly with the investor relations team who will assist with any queries.                                              GIT                         means Goodman Industrial Trust and its controlled entities, as the context requires.
Distribution policy                                                                                                                  GL                          means Goodman Limited and its controlled entities, as the context requires.
The Trust typically pays its distributions quarterly in the third month that follows each quarter e.g. the distribution for the      Goodman Group or GMG        means GL and GIT, operating together as a stapled group. Where either GL or GIT
September 2009 quarter was paid in December 2009. The table below shows the composition and timing of distributions                                              is party to a contract or agreement or responsible for an obligation or liability, without
per unit that have been paid this financial period.                                                                                                              the other, all references to Goodman Group as concerns that contract, agreement or
                                                                                                                                                                 responsibility shall be to that party alone.
 Distribution for          Cash                      Imputation                Total                     Payment date                GPSNZ                       means Goodman Property Services (NZ) Limited.
 quarter ended             distribution              credits                   distribution
                                                                                                                                     Independent Directors       has the meaning given to that term in the Listing Rules which, for the Manager at the
 31 Mar 2009               $0.02479                  $0.00156                  $0.02635                  18 June 2009                                            date of this Report, are Rick Bettle, Susan Paterson, Phil Pryke and Keith Smith.
                                                                                                                                     Listing Rules               means the Listing Rules of NZX from time to time and ‘LR’ is a reference to any of those
 30 Jun 2009               $0.02125                  $0.00077                  $0.02202                  17 September 2009
                                                                                                                                                                 rules.
 30 Sept 2009              $0.02125                  $0.00065                  $0.02190                  17 December 2009            Management                  means the senior executives of the Manager.
                                                                                                                                     Manager or GNZ              means the manager of the Trust, Goodman (NZ) Limited.
Distribution reinvestment plan                                                                                                       NTA                         means net tangible assets.
GMT currently offers a DRP for Unitholders that have registered addresses in New Zealand and a limited number of
                                                                                                                                     NZDX                        means the New Zealand debt market operated by NZX.
Australian “wholesale clients”, as that term is defined in section 761G of the Australian Corporations Act 2001. If Unitholders      NZX                         means NZX Limited or any market operated by it, as the context requires.
elect to participate in the DRP, they will receive additional units in GMT in exchange for quarterly cash distributions. If no       Registrar                   means the unit registrar for GMT which, at the date of this Report, is Computershare
election is made, Unitholders will receive distributions in the form of cash only. The last day for delivery of an election notice                               Investor Services Limited.
under the DRP is the record date for the relevant distribution, which is disclosed to NZX at the same time as the details of         sqm                         means square metres.
the distribution payment.                                                                                                            Trust Deed                  means the GMT trust deed dated 23 April 1999, as amended from time to time.
Registrar                                                                                                                            Trust or GMT                means Goodman Property Trust and its controlled entities, as the context requires.
Computershare Investor Services Limited is the registrar of GMT with responsibility for administering and maintaining the            Trustee                     means the trustee of the Trust, Perpetual Trust Limited.
Trust’s Unit Register. If you have a question about the administration of your investment, Computershare can be contacted            Unitholder or unitholder    means any holder of a Unit.
directly:
                                                                                                                                     Unit or unit                means a unit in GMT.
+ by phone, on their toll free number 0800 359 999 (+64 9 488 8777 outside New Zealand);
+ by email, to enquiry@computershare.co.nz; or
+ by mail, to Computershare Investor Services Limited, Private Bag 92119, Auckland 1142.




31                                                                                                                                   Goodman Property Trust Interim Report 2009                                                                         32
corporate directory


Manager                                           Registrar
Goodman (NZ) Limited                              Computershare Investor Services Limited
Level 3, Q & V Building                           Level 2, 159 Hurstmere Road
203 Queen Street                                  Takapuna
Auckland Central                                  Auckland


PO Box 90940                                      Private Bag 92119
Auckland Mail Centre 1142                         Auckland 1142


Toll free:    0800 000 656 (within New Zealand)   Toll free:   0800 359 999 (within New Zealand)
Telephone: +64 9 375 6060 (outside New Zealand)   Telephone: +64 9 488 8777 (outside New Zealand)
Facsimile: +64 9 375 6061                         Facsimile: +64 9 488 8787
Email:        info-nz@goodman.com                 Email:       enquiry@computershare.co.nz
Website:      www.goodman.com/GMT
                                                  Auditors
Directors of GNZ as at the Balance Date           PricewaterhouseCoopers
Acting Chairman                                   PricewaterhouseCoopers Tower
Greg Goodman                                      188 Quay Street
                                                  Auckland
Independent Directors
Rick Bettle                                       Private Bag 92162
Susan Paterson                                    Auckland 1142
Phil Pryke
Keith Smith                                       Trustee
                                                  Perpetual Trust Limited
Non-executive Director                            Level 12, AMP Centre
James Hodgkinson                                  29 Customs Street West
                                                  Auckland


                                                  PO Box 3376
                                                  Shortland Street
                                                  Auckland 1140




                                                                                                    This Interim Report for the six months ended 30 September 2009 has been prepared by Goodman (NZ) Limited as the
                                                                                                    Manager of GMT. The information in this Interim Report is general information only. It is not intended as investment or
                                                                                                    financial advice and must not be relied upon as such. You should obtain independent professional advice prior to making
                                                                                                    any decision relating to your investment or financial needs. This Interim Report is not an offer or invitation for subscription
                                                                                                    or purchase of securities or other financial products. Past performance is no indication of future performance. All values
                                                                                                    are expressed in New Zealand currency unless otherwise stated. December 2009.

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www.goodman.com/GMT

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