You are accessing the Global Goodman site. Are you looking for your local Goodman site?

Goodman European Logistics Fund (GELF) notes Moody’s Baa3 rating

Wednesday, May 23, 2012

Goodman European Logistics Fund (GELF) notes the rating assigned by Moody’s Investor
Service (Moody’s). GELF was assigned a first-time issuer rating of Baa3 with a ‘stable outlook’.

Moody’s noted that GELF’s high-quality portfolio of modern prime logistics properties with
continuously high occupancy rates provides the fund with ‘sustained positive cash flows’ and
said that the fund has a lower business risk profile than similarly rated peers, because its
development activity represents only a small proportion of its assets.

Emmanuel Van der Stichele, Fund Director GELF said: “We are pleased to have obtained an
investment grade rating from Moody’s. This is a real endorsement of GELF, our business
strategy and the strength of the Continental European portfolio. The rating is a significant
milestone in GELF’s strategy of diversifying its sources of capital.”

GELF has 92 assets in its portfolio totaling 3 million sqm of warehouse space across continental
Europe and is valued at €1.7 billion, making it one of the largest unlisted real estate funds in
Europe.

Please see the attached announcement made by Moody’s for further information.

                                                                                  - Ends -

For further information, please contact Goodman:
Majella O Doherty
Communications Manager
+32 2 263 4068
Majella.odoherty@goodman.com

About Goodman European Logistics Fund (GELF)
Goodman European Logistics Fund, FCP-FIS (GELF or ‘the Fund’) is a Luxembourg-based
investment vehicle operating a €1.7 billion pan-European logistics real estate platform, spread
over 11 countries. The Fund, managed by Goodman, focuses on high quality logistics and
warehouse properties. GELF offers well-informed, institutional investors a right of first refusal
over assets developed by Goodman Group in Continental Europe. GELF is now one of the
largest unlisted European funds dedicated to logistics real estate.

Rating Action: Moody's assigns Baa3 to Goodman European Logistics
Fund, stable outlook

Global Credit Research - 21 May 2012

First-time rating

London, 21 May 2012 -- Moody's Investors Service has today assigned a first-time issuer rating of Baa3 with a
stable outlook to Goodman European Logistics Fund (GELF). GELF is an unlisted real estate fund that makes direct
investments in modern prime logistics properties across 11 countries in Europe.

RATINGS RATIONALE

"GELF's Baa3 rating primarily reflects the strong brand name and franchise value brought to the fund by its external
manager and largest unit-holder, Goodman Group, a listed Australian industrial real estate investment trust, or REIT,
and recognised leader in logistics property," says Lynn Valkenaar, a Moody's Vice President -- Senior Analyst and
lead analyst for GELF. "Other key strengths underpinning the rating are (1) GELF's high-quality portfolio of modern
prime logistics properties, which have persistently high occupancy rates and broad geographic diversification,
providing the fund with sustained positive cash flows from operations; and (2) a lower business risk profile than
similarly rated peers, because the fund's development activity represents only a small proportion of its assets," adds
Ms Valkenaar.

GELF's financial strength also supports the rating. At financial year end 2011, the fund's effective leverage (total
debt/gross assets, as adjusted by Moody's) was a moderate 43% and its fixed charge coverage (adjusted
EBITDA/gross interest expense + capitalised interest + ground rents, as adjusted by Moody's) was 2.8x.

These strengths are counterbalanced by the fund's smaller scale relative to similarly rated peers and its exposure to
income concentration risk, with its top 10 customers accounting for almost half of its revenues in the financial year
2011.

Moody's also factors into the rating its cautious outlook for European logistics property this year. Tenant demand is
related to economic growth as well as the growth in world trade, both of which are expected to remain below longterm
averages in 2012. Therefore, there is at present considerable uncertainty surrounding tenant demand. On the
other hand, large consumers of logistics space are seeking to consolidate into bigger, modern facilities such as
those offered by GELF. As a result, Moody's expects that GELF will continue to experience downward pressure on
rents in some locations, although it will benefit from rental growth in others, as in 2011.

Moody's considers that GELF's liquidity is currently adequate, with the fund's earliest debt maturity in December
2013. However, the fund faces a "liquidity review" in 2016, when unit-holders wishing to withdraw their equity stake
may do so. The rating assumes that the liquidity review will provide no disruption to the business, nor will it
negatively affect the fund's financial strength. This view reflects (i) proven unit-holder support, as evidenced by
GELF's multiple equity raises over the past 5.5 years; (ii) the fact that Goodman Group already provides limited but
ongoing liquidity to other unit-holders on a quarterly basis; (iii) the maintenance of strong corporate governance
principles that are aimed to align Goodman Group's interests with those of the unit holders; and (iv) that GELF's
bank covenants ensure that any cash proceeds from the sale of assets must amortise debt in priority to refunding
unit-holders' investments.

The stable outlook reflects GELF's sound financial position, steady cash flow generation and the expert
management provided by Goodman Group (Baa2 stable). The European logistics market has not yet fully recovered
from lower levels of growth in world trade and economic output in Europe. However, in Moody's view, GELF's
deleveraging plan should protect its financial metrics from the downward pressure on rents that is expected to
continue in some of its locations through 2012. The stable outlook also assumes that GELF's financial covenants will
continue to protect unsecured lenders effectively from the liquidity review in 2016 and that the fund will maintain an
adequate liquidity profile at all times.

WHAT COULD CHANGE THE RATING UP/DOWN

Although unlikely in the near term, upward pressure on the rating or outlook could arise as GELF develops greater
scale and tenant diversification in conjunction with (i) reducing its leverage, as measured by gross assets/total debt
(as adjusted by Moody's), to materially below 40% and maintaining fixed charge coverage above 2.75x on a
sustainable basis; (ii) maintaining the ratio of secured debt/gross assets below 20%; and (iii) preserving its policy to
largely acquire completed investments rather than develop them.

Downward pressure on the rating could arise if (i) GELF's business risk profile weakens as a result of an increased
concentration of tenant income or an enlarged development programme that exceeds 7.5% of gross assets on a
sustained basis; (ii) its financial covenants cease to protect unsecured lenders effectively from liquidity reviews or
Moody's develops other liquidity concerns; or (iii) the fund's financial metrics deteriorate such that it fails to maintain
(a) its fixed charge coverage ratio comfortably above 2.2x; (b) effective leverage at or below 45%; or (c) secured
debt/gross assets below 25%.

The principal methodology used in rating GELF was Moody's Approach for REITs and Other Commercial Property
Firms, published in July 2010. Please see the Credit Policy page on www.moodys.com for a copy of this
methodology.

Goodman European Logistics Fund is registered in Luxembourg as an unlisted "fonds commun de placement" that
specialises in logistics property investments. The fund reported EUR124 million (approximately USD 95 million) in
revenues and EUR 1.7 billion in total assets in the financial year ended 31 December 2011.

REGULATORY DISCLOSURES

For ratings issued on a program, series or category/class of debt, this announcement provides relevant regulatory
disclosures in relation to each rating of a subsequently issued bond or note of the same series or category/class of
debt or pursuant to a program for which the ratings are derived exclusively from existing ratings in accordance with
Moody's rating practices. For ratings issued on a support provider, this announcement provides relevant regulatory
disclosures in relation to the rating action on the support provider and in relation to each particular rating action for
securities that derive their credit ratings from the support provider's credit rating. For provisional ratings, this
announcement provides relevant regulatory disclosures in relation to the provisional rating assigned, and in relation
to a definitive rating that may be assigned subsequent to the final issuance of the debt, in each case where the
transaction structure and terms have not changed prior to the assignment of the definitive rating in a manner that
would have affected the rating. For further information please see the ratings tab on the issuer/entity page for the
respective issuer on www.moodys.com.

The rating has been disclosed to the rated entity or its designated agent(s) and issued with no amendment resulting
from that disclosure.

Information sources used to prepare the rating are the following : parties involved in the ratings, public information,
and confidential and proprietary Moody's Investors Service information.

Moody's considers the quality of information available on the rated entity, obligation or credit satisfactory for the
purposes of issuing a rating.

Moody's adopts all necessary measures so that the information it uses in assigning a rating is of sufficient quality
and from sources Moody's considers to be reliable including, when appropriate, independent third-party sources.
However, Moody's is not an auditor and cannot in every instance independently verify or validate information
received in the rating process.

Moody's Investors Service may have provided Ancillary or Other Permissible Service(s) to the rated entity or its
related third parties within the two years preceding the credit rating action. Please see the special report "Ancillary or
other permissible services provided to entities rated by MIS's EU credit rating agencies" on the ratings disclosure
page on our website www.moodys.com for further information.

Please see the ratings disclosure page on www.moodys.com for general disclosure on potential conflicts of interests.

Please see the ratings disclosure page on www.moodys.com for information on (A) MCO's major shareholders
(above 5%) and for (B) further information regarding certain affiliations that may exist between directors of MCO and
rated entities as well as (C) the names of entities that hold ratings from MIS that have also publicly reported to the
SEC an ownership interest in MCO of more than 5%. A member of the board of directors of this rated entity may also
be a member of the board of directors of a shareholder of Moody's Corporation; however, Moody's has not
independently verified this matter.

Please see Moody's Rating Symbols and Definitions on the Rating Process page on www.moodys.com for further information on the meaning of each rating category and the definition of default and recovery.

Please see ratings tab on the issuer/entity page on www.moodys.com for the last rating action and the rating history.

The date on which some ratings were first released goes back to a time before Moody's ratings were fully digitized
and accurate data may not be available. Consequently, Moody's provides a date that it believes is the most reliable
and accurate based on the information that is available to it. Please see the ratings disclosure page on our website
www.moodys.com for further information.

Please see www.moodys.com for any updates on changes to the lead rating analyst and to the Moody's legal entity
that has issued the rating.

Lynn Valkenaar
Vice President - Senior Analyst
Corporate Finance Group
Moody's Investors Service Ltd.
One Canada Square
Canary Wharf
London E14 5FA
United Kingdom
JOURNALISTS: 44 20 7772 5456
SUBSCRIBERS: 44 20 7772 5454

Paloma San Valentin
MD - Corporate Finance
Corporate Finance Group
JOURNALISTS: 44 20 7772 5456
SUBSCRIBERS: 44 20 7772 5454

Releasing Office:
Moody's Investors Service Ltd.
One Canada Square
Canary Wharf
London E14 5FA
United Kingdom
JOURNALISTS: 44 20 7772 5456
SUBSCRIBERS: 44 20 7772 5454

                                                                                                                   MOODY'S INVESTORS SERVICE

© 2012 Moody's Investors Service, Inc. and/or its licensors and affiliates (collectively,
"MOODY'S"). All rights reserved.

CREDIT RATINGS ISSUED BY MOODY'S INVESTORS SERVICE, INC. ("MIS") AND ITS
AFFILIATES ARE MOODY'S CURRENT OPINIONS OF THE RELATIVE FUTURE CREDIT
RISK OF ENTITIES, CREDIT COMMITMENTS, OR DEBT OR DEBT-LIKE SECURITIES, AND
CREDIT RATINGS AND RESEARCH PUBLICATIONS PUBLISHED BY MOODY'S ("MOODY'S
PUBLICATIONS") MAY INCLUDE MOODY'S CURRENT OPINIONS OF THE RELATIVE
FUTURE CREDIT RISK OF ENTITIES, CREDIT COMMITMENTS, OR DEBT OR DEBT-LIKE
SECURITIES. MOODY'S DEFINES CREDIT RISK AS THE RISK THAT AN ENTITY MAY NOT
MEET ITS CONTRACTUAL, FINANCIAL OBLIGATIONS AS THEY COME DUE AND ANY
ESTIMATED FINANCIAL LOSS IN THE EVENT OF DEFAULT. CREDIT RATINGS DO NOT
ADDRESS ANY OTHER RISK, INCLUDING BUT NOT LIMITED TO: LIQUIDITY RISK,
MARKET VALUE RISK, OR PRICE VOLATILITY. CREDIT RATINGS AND MOODY'S
OPINIONS INCLUDED IN MOODY'S PUBLICATIONS ARE NOT STATEMENTS OF CURRENT
OR HISTORICAL FACT. CREDIT RATINGS AND MOODY'S PUBLICATIONS DO NOT
CONSTITUTE OR PROVIDE INVESTMENT OR FINANCIAL ADVICE, AND CREDIT RATINGS
AND MOODY'S PUBLICATIONS ARE NOT AND DO NOT PROVIDE RECOMMENDATIONS TO
PURCHASE, SELL, OR HOLD PARTICULAR SECURITIES. NEITHER CREDIT RATINGS NOR
MOODY'S PUBLICATIONS COMMENT ON THE SUITABILITY OF AN INVESTMENT FOR ANY
PARTICULAR INVESTOR. MOODY'S ISSUES ITS CREDIT RATINGS AND PUBLISHES
MOODY'S PUBLICATIONS WITH THE EXPECTATION AND UNDERSTANDING THAT EACH
INVESTOR WILL MAKE ITS OWN STUDY AND EVALUATION OF EACH SECURITY THAT IS
UNDER CONSIDERATION FOR PURCHASE, HOLDING, OR SALE.

ALL INFORMATION CONTAINED HEREIN IS PROTECTED BY LAW, INCLUDING BUT NOT
LIMITED TO, COPYRIGHT LAW, AND NONE OF SUCH INFORMATION MAY BE COPIED OR
OTHERWISE REPRODUCED, REPACKAGED, FURTHER TRANSMITTED, TRANSFERRED,
DISSEMINATED, REDISTRIBUTED OR RESOLD, OR STORED FOR SUBSEQUENT USE FOR
ANY SUCH PURPOSE, IN WHOLE OR IN PART, IN ANY FORM OR MANNER OR BY ANY
MEANS WHATSOEVER, BY ANY PERSON WITHOUT MOODY'S PRIOR WRITTEN CONSENT.
All information contained herein is obtained by MOODY'S from sources believed by it to be
accurate and reliable. Because of the possibility of human or mechanical error as well as other
factors, however, all information contained herein is provided "AS IS" without warranty of any kind.
MOODY'S adopts all necessary measures so that the information it uses in assigning a credit
rating is of sufficient quality and from sources Moody's considers to be reliable, including, when
appropriate, independent third-party sources. However, MOODY'S is not an auditor and cannot in
every instance independently verify or validate information received in the rating process. Under
no circumstances shall MOODY'S have any liability to any person or entity for (a) any loss or
damage in whole or in part caused by, resulting from, or relating to, any error (negligent or
otherwise) or other circumstance or contingency within or outside the control of MOODY'S or any
of its directors, officers, employees or agents in connection with the procurement, collection,
compilation, analysis, interpretation, communication, publication or delivery of any such
information, or (b) any direct, indirect, special, consequential, compensatory or incidental
damages whatsoever (including without limitation, lost profits), even if MOODY'S is advised in
advance of the possibility of such damages, resulting from the use of or inability to use, any such
information. The ratings, financial reporting analysis, projections, and other observations, if any,
constituting part of the information contained herein are, and must be construed solely as,
statements of opinion and not statements of fact or recommendations to purchase, sell or hold any
securities. Each user of the information contained herein must make its own study and evaluation
of each security it may consider purchasing, holding or selling. NO WARRANTY, EXPRESS OR
IMPLIED, AS TO THE ACCURACY, TIMELINESS, COMPLETENESS, MERCHANTABILITY OR
FITNESS FOR ANY PARTICULAR PURPOSE OF ANY SUCH RATING OR OTHER OPINION OR
INFORMATION IS GIVEN OR MADE BY MOODY'S IN ANY FORM OR MANNER WHATSOEVER.

MIS, a wholly-owned credit rating agency subsidiary of Moody's Corporation ("MCO"), hereby
discloses that most issuers of debt securities (including corporate and municipal bonds,
debentures, notes and commercial paper) and preferred stock rated by MIS have, prior to
assignment of any rating, agreed to pay to MIS for appraisal and rating services rendered by it
fees ranging from $1,500 to approximately $2,500,000. MCO and MIS also maintain policies and
procedures to address the independence of MIS's ratings and rating processes. Information
regarding certain affiliations that may exist between directors of MCO and rated entities, and
between entities who hold ratings from MIS and have also publicly reported to the SEC an
ownership interest in MCO of more than 5%, is posted annually at www.moodys.com under the
heading "Shareholder Relations — Corporate Governance — Director and Shareholder Affiliation
Policy."

Any publication into Australia of this document is by MOODY'S affiliate, Moody's Investors Service
Pty Limited ABN 61 003 399 657, which holds Australian Financial Services License no. 336969.
This document is intended to be provided only to "wholesale clients" within the meaning of section
761G of the Corporations Act 2001. By continuing to access this document from within Australia,
you represent to MOODY'S that you are, or are accessing the document as a representative of, a
"wholesale client" and that neither you nor the entity you represent will directly or indirectly
disseminate this document or its contents to "retail clients" within the meaning of section 761G of
the Corporations Act 2001.

Notwithstanding the foregoing, credit ratings assigned on and after October 1, 2010 by Moody's
Japan K.K. (“MJKK”) are MJKK's current opinions of the relative future credit risk of entities, credit
commitments, or debt or debt-like securities. In such a case, “MIS” in the foregoing statements
shall be deemed to be replaced with “MJKK”. MJKK is a wholly-owned credit rating agency
subsidiary of Moody's Group Japan G.K., which is wholly owned by Moody’s Overseas Holdings
Inc., a wholly-owned subsidiary of MCO.

This credit rating is an opinion as to the creditworthiness of a debt obligation of the issuer, not on
the equity securities of the issuer or any form of security that is available to retail investors. It
would be dangerous for retail investors to make any investment decision based on this credit
rating. If in doubt you should contact your financial or other professional adviser.