One of Australia’s largest pension funds is entering the Los Angeles industrial market through a deal with fellow Aussie firm Goodman Group.
Sydney-based Aware Super is buying a 49% stake in Goodman Group’s 3 million-square-foot, 187-acre Los Angeles portfolio made up of three warehouse complexes in Long Beach, Compton and Santa Fe Springs in southeast Los Angeles County.
The properties are occupied by retailer Amazon, third-party logistics firm Maersk and rocket manufacturer Relativity Space.
Goodman is keeping a 51% ownership stake and will manage the properties. The companies did not reveal the financial terms of each party’s stake but said the deal values the properties at about $1.3 billion. The two firms added that they plan to make more investments together in the region.
The deal reflects Aware Super’s “counter-cyclical approach of identifying opportunities when others are cautious,” said a statement from Head of Property Alek Misev.
“Despite recent market uncertainty, we remain confident in the strong long-term fundamentals of the U.S. industrial sector, with Los Angeles benefiting from limited supply and robust consumption patterns,” Misev said.
The U.S. industrial market has hit a rough patch, with vacancy climbing to 7.5%, the highest in a decade, as new supply outpaces demand, according to CoStar research. Rents that surged during the pandemic are now flat quarter over quarter, giving tenants more leverage. With trade uncertainty, tariffs and softer consumer spending looming, analysts warn vacancy could edge up around 8% before conditions improve in 2027.
Institutional investors are still targeting Los Angeles industrial assets, driving around 35% of acquisition volume in the market over the past three years, in line with historical averages, according to Jesse Gundersheim, senior director of market analytics for Los Angeles for CoStar.
“Los Angeles industrial leasing activity is rebounding, and vacancies aren’t rising as quickly as they were a year ago,” Gundersheim said.
International interest
This deal marks the latest collaboration between Aware Super and Goodman Group, following joint investments in Australia and Brazil since 2012.
It also lays the groundwork for Aware Super’s broader U.S. expansion, which includes adding industrial and build-to-rent residential properties to its portfolio. The fund has already launched a European platform in London and is “exploring opportunities” in Asia, according to Anjana Moran, senior portfolio manager at Aware Super.
Sydney-based Goodman Group is growing across the United States as well, with business in the country representing 33% of its non-Australian earnings.
The firm, which recently celebrated the topping off of its first data center project in the U.S. in the Los Angeles County city of Vernon, sees “significant growth opportunities in our key U.S. infill markets to support the development of essential infrastructure in a rapidly transforming digital economy,” Goodman Group CEO Gregory Goodman said in a statement.
It’s the second time this year a major global fund has invested in Goodman Group’s U.S. industrial properties.
In January, Norwegian sovereign wealth fund Norges Bank Investment Management bought a 45% interest in a nearly 14 million-square-foot U.S. industrial portfolio — co-owned by Goodman Group — from the Canada Pension Plan Investment Board. The properties are in Southern California, Northern New Jersey and the Lehigh Valley area of Pennsylvania.