Goodman Makes Further Progress Cutting Risk in Its Data Center Pipeline, Citi Says

what happened

According to Market Talk, Citi sees Goodman's first-quarter update as a clear move toward lower risk in its data center development pipeline. The HKG09 facility in Hong Kong is already leased out to tenants. In August, the group agreed a 20-year contract with a large global hyperscale operator for the initial 50-megawatt stage of the Tsukuba Tech Central campus in Greater Tokyo.

Analyst Howard Penny highlighted the next watchpoints: HKG10, a 50MW site where advanced negotiations are underway, Los Angeles LAX02, also in advanced talks for the entire building, and Amsterdam's AMS01. He added that projects in Paris, Frankfurt and Sydney, with medium- to long-term timelines, are on track with plans.

Ahead of the update, Citi had a buy rating and an A$40.00 price target on Goodman. On the day, the shares were down 1.0% at A$27.03.

why it matters

For markets, the key point is the progress itself: large leases for data center capacity reduce uncertainty over utilization and cash flows for a developer, which investors in this segment watch closely. Further signed agreements for HKG10 and LAX02 would be the next test of the company's project pipeline.

market impact

Goodman shares: lower risk in data center projects supports interest in the stock

• ▲Goodman shares pressure up — lower risk in the data center pipeline, per Citi, supports the stock

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