Goodman Group's power bank advantage drives an earnings guidance upgrade

A June 2026 operational update lifted Goodman Group's earnings guidance and, for the first time, disclosed delivery dates across its data centre pipeline, giving fund managers a clearer view of a thesis built on land, power and capital partnerships.

20 Jul 2026 · 8 min read

Goodman Group (ASX: GMG) used its June 2026 third-quarter operational update to give fund managers something they had been asking for through most of the year: a clearer timeline. Pendal Group reported that earnings guidance was "modestly upgraded indicating a minimum of 9% growth," with the ultimate outcome still contingent on performance fees to be calculated in the fourth quarter, which could underwrite an even stronger result. More significantly, Goodman disclosed Ready for Service dates across the majority of its initial roughly 500MW data centre development pipeline for the first time, alongside new capital partners in its Hong Kong and Japan development vehicles.

Goodman disclosed Ready for Service (RFS) dates across the majority of its initial ~500MW data centre development pipeline for the first time, improving transparency on delivery timing.

Pendal Group, Newsletter, June 2026

The power bank thesis that keeps managers engaged

The case for owning Goodman Group through 2026 has consistently rested less on any single leasing announcement and more on structural advantages that are difficult for competitors to replicate. Perpetual Asset Management laid out that thesis clearly in April 2026, pointing to Goodman's 6GW power bank secured across 16 metro markets as the key differentiator from traditional industrial property peers.

As AI-driven data centre demand continues to accelerate, power access is emerging as the truly scarce resource, increasingly more so than land itself. This creates a substantial and durable competitive moat that is exceptionally difficult and time-consuming for others to replicate.

Perpetual Asset Management, Monthly Report, April 2026

That same month, Goodman announced a 50/50 joint venture with DataBank for a 32MW co-location facility in Los Angeles, a deal L1 Capital said reflected the company's unique position "given its land bank, development expertise, strong balance sheet and capital partner relationships, against a backdrop of growing demand and constrained supply." The announcement removed an overhang that had built up around the LAX01 development, and Perpetual noted the market had previously harboured concerns about the lack of a capital partner and tenant for the site before the update sent the stock up 7% on the day and 15.8% for the month.

Not every manager is convinced by the pace of leasing

The skepticism has centred on execution speed rather than the underlying opportunity. Yarra Capital Management held an underweight position through the first half of 2026, arguing in March that while Goodman's shorter-term earnings momentum overall remained intact, "investors were disappointed with the lack of data centre customer commitments accompanying the strong power bank, partnership progress and data centre development activity." The fund said it retained a preference for NextDC within the data centre space, a stance it maintained into April even after the DataBank deal, noting that "deal earnings were likely already embedded in expectations, rather than being incremental."

That caution echoed a broader wobble in late 2025, when Goodman fell more than 10% in November after a first-quarter update reiterated guidance but flagged that earnings would skew to the second half due to the phasing of data centre projects. SG Hiscock & Company attributed the sell-off to sector-wide pressure rather than company-specific news, noting "rising bond yields, concerns around tech valuations after a strong run and growing cautiousness around AI capex and returns are weighing on the sector." Clime Investment Management took the same view at the time, maintaining that Goodman "has a strong value creation outlook thanks to its ongoing ability to repurpose its privileged global real estate portfolio toward higher value, alternative uses."

Managers who stayed the course through the volatility

Several long-term holders used the weakness as an entry point rather than an exit signal. Wilson Asset Management's WAM Leaders team argued in May 2026 that even though the third-quarter update lacked major headline catalysts such as new data centre leases, commercial negotiations across multiple global projects were progressing well, with formal contracts expected to be signed over the rest of the year. Ten Cap struck a similar note, saying Goodman "continues to benefit from new contracted capacity across its US data-centre portfolio, reinforcing long-term earnings visibility."

Further back, in February 2026, Ausbil Investment Management framed Goodman's transition from an industrial developer to a data centre platform as an opportunity rather than a risk, noting the company "continued to deliver double digit earnings growth throughout this transition" with a balance sheet that is "self funding in the data centre world, which is quite rare." Sage Capital took a similar view in January 2026 after Goodman announced its inaugural European data centre fund, adding to its position on the resulting bounce and citing the company's capital partnership model as offering higher returns on equity than self-funded developments.

What comes next

With the RFS date disclosure now public and new capital partners locked in for Hong Kong and Japan, the questions fund managers are watching have narrowed. Pendal Group noted that while there were no major lease announcements from potential tenants in the June update, management emphasised that "active and extensive negotiations are underway across multiple assets," and expects the newly published delivery timeline to "facilitate significant leasing activity over the remainder of the calendar year." Whether that leasing materialises, and whether performance fees due in the fourth quarter push earnings growth meaningfully above the 9% floor, will determine whether Goodman's skeptics come around or its bulls are proven right.