Why Warehouse Demand Matters for S&P/ASX 200 Property Stocks Goodman (ASX:GMG) and Centuria Industrial REIT (ASX:CIP)

Centuria Industrial REIT (ASX:CIP) re-leased Warehouse space in FY26 at net rents averaging 30 per cent above the leases they replaced. Goodman Group (ASX:GMG), the far larger neighbour in the same S&P/ASX 200 property sector, lifted operating profit by 15.7 per cent over the same year, yet most of its Earnings no longer come from collecting rent.

That contrast is why the pair is useful. Both depend on businesses needing modern logistics space, but warehouse Demand reaches their results through different channels: rent reviews and re-leasing for Centuria, and development, funds management and rent for Goodman.

Two ways to earn from a warehouse

Goodman is a stapled group, meaning shares in its Australian company and trust units (plus a Hong Kong entity) trade together as one security. It owns, develops and manages industrial and logistics property, and increasingly data centres, across multiple countries, usually alongside Capital partners in managed partnerships. Those partnerships held external Assets under management of $75.4 billion at 30 June 2026, generating the fee income that sits beside rent and development profits.

Centuria Industrial REIT is a pure Australian industrial real estate Investment trust. It is externally managed by Centuria Capital Group (ASX:CNI), which held a 16 per cent co-investment and received $23.9 million in management fees in FY26, according to the trust's 2026 annual report. Its income is almost entirely rent from 83 properties, weighted towards New South Wales (36 per cent) and Queensland (33 per cent), with 92 per cent of tenants described as listed, multinational or national businesses.

What the FY26 numbers show

Goodman released its FY26 results on 19 August 2026, for the year to 30 June 2026, reporting operating profit up 15.7 per cent to A$2.67 billion and development work in progress (WIP) of $19.7 billion. WIP is the estimated end value of projects under construction.

Coverage of the release reported operating earnings of 129.9 cents per security, up 10.1 per cent, a distribution of 30.0 cents, gearing of 6.5 per cent and guidance for 9 per cent operating earnings growth in FY27. Portfolio occupancy was 95.6 per cent, with like-for-like net property income growth of 4.0 per cent.

Centuria's 2026 annual report, lodged on 23 September 2026 and also covering the year to 30 June, shows Funds From Operations (FFO) of $114.1 million, or 18.2 cents per unit, up 4 per cent. FFO is the REIT sector's preferred measure of recurring cash earnings, excluding items such as valuation movements. Distributions were 16.8 cents per unit and Net Tangible Assets (NTA) rose to $4.01 per unit, helped by $116 million of valuation gains. Statutory profit, which includes those revaluations, was $160.4 million.

Where warehouse demand shows up for each

For Centuria, the evidence of demand is in leasing. The trust leased 226,200 square metres across 30 deals in FY26, equal to 18 per cent of its lettable area. Like-for-like net operating income, which strips out acquisitions and sales, grew 5.2 per cent. Management estimates the portfolio is about 17 per cent under-rented, meaning current rents sit below market levels, which could support future re-leasing gains if conditions hold.

The trust describes national industrial vacancy as relatively low at about 4 per cent, with Supply becoming increasingly constrained. Its weighted average Lease expiry (WALE), the average time left on leases weighted by income, was 7.0 years, and its weighted average Capitalisation rate, the implied Yield used in valuations, was 5.80 per cent.

Goodman's logistics exposure appears more indirectly. On the results call, management said large-scale logistics opportunities were emerging as customers look to consolidate and automate, and suggested Australian logistics WIP alone could reach about A$3 billion. Heavily automated warehouses need more power and bigger sites, which suits a developer with large land and power holdings. Across all property types, Goodman completed $3.6 billion of developments in FY26, with 89 per cent of those completions leased, according to coverage of the release.

Our comparison: how much of the profit is rent?

By our calculation, using the segment figures reported in Tamim Asset Management's review of the result, Goodman's FY26 development earnings were $1,792.2 million, property investment earnings $722.1 million and management earnings $690.1 million. Rental-style property investment income was therefore about 23 per cent of those three segments combined ($722.1m ÷ $3,204.4m), before corporate costs.

Centuria's FFO, by contrast, is essentially rent less property, financing and management costs. So a one-point move in warehouse rents matters far more, proportionally, to Centuria's earnings than to Goodman's, where development margins and fee income dominate.

Payout ratios show the same split. Centuria distributed about 92 per cent of FFO (16.8 ÷ 18.2 cents), while Goodman paid out about 23 per cent of operating earnings (30.0 ÷ 129.9 cents), retaining the rest to fund development.

Limits of the comparison

Scale differs enormously: Goodman reported a total portfolio of about $89 billion including partnerships, against Centuria's $3.9 billion. Goodman's occupancy and income growth cover offshore markets and data centres, while Centuria's figures are Australia-only. Goodman's 6.5 per cent balance-sheet gearing also excludes Debt inside its partnerships; look-through gearing was reported at 19.5 per cent. Operating earnings and FFO are both non-statutory measures defined by each group.

Risks and what to watch

For Centuria, the main sensitivities are interest rates and refinancing. Gearing was 34.9 per cent, 54 per cent of drawn debt was hedged, and its all-in cost of debt was 4.7 per cent, with Interest Cover of 2.4 times. Telstra contributes 9 per cent of income, a meaningful single-tenant exposure. A rise in vacancy or new supply in infill markets would slow re-leasing spreads.

For Goodman, the risk is less about warehouse vacancy and more about execution: delivering a data-centre-heavy pipeline on time, securing power and keeping capital partners committed. Its Annual General Meeting is scheduled for 19 November 2026.

Useful indicators for both include Australian industrial vacancy and supply data, Centuria's progress toward its FY27 guidance of 18.8–19.2 cents FFO and 17.3 cents distribution per unit, and whether Goodman's logistics pipeline grows as management suggested. Both remain S&P/ASX 200 members after the September 2026 index rebalance.