How Will Stockland’s $3.5bn Logistics Hub Transform Its Growth Trajectory?
Stockland delivered a statutory profit of $826 million for FY25, hitting the top end of its guidance, while securing major partnerships and setting the stage for strong earnings growth in FY26.
- FY25 statutory profit surges to $826m from $305m
- Post-tax Funds From Operations (FFO) up 2.8% to $808m
- New $3.5bn logistics hub partnership near Sydney Airport
- Exclusive data centre partnership with EdgeConneX announced
- FY26 FFO per security guidance raised to 36.0–37.0 cents
Strong Financial Performance
Stockland Corporation Ltd (ASX, SGP) reported a robust FY25 result, with statutory profit soaring to $826 million, a significant leap from $305 million in the prior year. This performance was driven by a 2.8% increase in post-tax Funds From Operations (FFO) to $808 million, reflecting solid operational execution across its diversified property portfolio.
The company maintained disciplined capital management, with gearing steady at 25.2% and liquidity of approximately $2.9 billion, underpinning its capacity to fund growth initiatives.
Strategic Partnerships and Asset Recycling
FY25 was marked by Stockland’s strategic expansion through three new capital partnerships. Notably, a 50/50 joint venture with John Boyd Properties aims to develop a multi-story logistics hub valued at over $3.5 billion adjacent to Sydney Airport, positioning Stockland at the forefront of Australia’s logistics infrastructure growth.
Additionally, the company announced an exclusive arrangement with global data centre operator EdgeConneX to develop, own, and operate a portfolio of Australian data centres, signaling Stockland’s entry into the fast-growing data infrastructure sector. This partnership complements its secured power and zoning approvals for over 100MW of data centre development at MPark Stage 2 in New South Wales.
Stockland also recycled approximately $289 million of logistics assets, optimizing value and reallocating capital to higher-growth opportunities.
Development Pipeline and Market Demand
The company’s development segment showed strength, with masterplanned communities (MPC) delivering 6,865 settlements, exceeding targets and reflecting strong customer demand. Land Lease Communities (LLC) also grew, with 526 home settlements, supported by new community launches and solid contract backlogs.
Stockland’s development pipeline remains robust, with approximately $600 million in logistics assets under construction and ongoing projects across town centres and communities real estate valued at around $270 million. The company anticipates FY26 MPC settlements between 7,500 and 8,500 lots, and LLC settlements of 700 to 800 homes, underpinning future earnings growth.
Outlook and Guidance
Looking ahead, Stockland forecasts FY26 FFO per security between 36.0 and 37.0 cents, with distributions expected to remain steady at 25.2 cents per security. The payout ratio target has been revised to a range of 60% to 80% of FFO, aligning with the company’s focus on sustainable long-term value creation.
Gearing is expected to stay within the targeted 20-30% range, supporting ongoing investment in growth projects and partnerships.
Bottom Line?
Stockland’s FY25 results and strategic partnerships set a strong foundation, but execution of its ambitious logistics and data centre projects will be critical to sustaining momentum in FY26 and beyond.
Questions in the middle?
- How will the new logistics hub near Sydney Airport impact Stockland’s long-term earnings profile?
- What are the risks and timelines associated with the data centre partnership with EdgeConneX?
- How might changes in market conditions affect Stockland’s FY26 guidance and development pipeline?
