Billionaire Greg Goodman’s rezoning gambit extracts value from industrial sites, minus the development risk

Goodman Group won’t build apartments, but wants to sell sites to other developers.

Greg Goodman, apartments billionaire? Goodman Group is lodging plans for rezonings.

The listed Goodman Group is chasing approval for 1400 apartments on a site it has assembled in Sydney’s southern suburbs near Mascot station, where the Minns government has flagged the potential for more residential projects.

It already has plans to rezone sites in the northern suburb of Macquarie Park into build-to-rent towers that could accommodate thousands of residents. In each case, Goodman looks to rezone the land rather than develop it itself. The sites would be traded to a specialist developer.

Rival companies including Stockland and Charter Hall have looked to rezone sites and are weighing up development themselves. But Goodman will stick to its core focus on industrial and data centre projects, the source of its growth and Mr Goodman’s $5bn fortune according to The List – Australia’s Richest 250.

The rezoning moves are partly about seeking the highest and best use for land that no longer fits the bill for industrial use. But the funds will also go into helping fund the massive data centre and logistics hubs that the company is planning.

Greg Goodman. Picture: John Feder/The Australian.

Goodman has been ramping up its purchases of industrial land in key parts of Sydney – notably near the new western Sydney airport – and in Brisbane.

Goodman made huge profits a decade ago when it sold off sites to Meriton billionaire Harry Triguboff and Chinese groups. Big deals include selling to Golden Horse in Sydney’s Erskineville and Chinese group Australia YMCI that planned a mini-city near Sydney Olympic Park. It also sold sites on Sydney’s north shore to Meriton in that precinct, and to the then expanding Country Garden.

While apartment sites are again in demand, the supercharged prices that Chinese groups were paying to get into Australia are gone.

Goodman’s latest gambit to shepherd sites through rezoning and boost their value is a more modest one.

“The exposure to residential projects is interesting but not as show stopping as the last time,” one analyst said, referring to the residential boom a decade ago. He cited a number of opportunities but many appear long-dated and are still subject to planning controls being relaxed.

The NSW government’s fast track planning reforms have enabled developers to submit ambitious schemes that will address the housing crisis. But proposals often take years and must stack up for potential buyers, too.

Goodman put in plans four years ago to demolish a corporate centre near Macquarie University and replace it with five new buildings where a developer could undertake about 736 apartments. The proposal is still navigating the planning system.

It has also applied to demolish a nearby business park and put about 513 apartments on that land. Mr Goodman said at the time that it would not undertake projects on its own: “We’ll be looking to sell the sites we get planned and rezoned,” he emphasised.

The company has declined to comment on its most recent moves but the warehouses and offices on the Mascot site would be replaced by about 15 apartment buildings if Goodman gets its rezoning signed off. Its planning documents say this would create more housing near Mascot, including affordable housing.