Macquarie Goodman Industrial Trustarsn 091 213

REPORT FOR THE HALF YEAR ENDED 31 DECEMBER 2002 Macquarie Goodman Industrial Trust ARSN 091 213 839

REPORT FOR THE HALF YEAR ENDED 31 DECEMBER 2002 Macquarie Goodman Industrial Trust [email protected] Auditor KPMG The KPMG Centre 45 Clarence Street Sydney NSW 2000 ASX Code MGI Custodians Company of Australia Limited Trust 35 Clarence Street Sydney NSW 2000 Company Limited Trustee Perpetual 1 Castlereagh Street Sydney NSW 2000 Unit Registrar Pty Limited Computershare Investor Services GPO Box 1903 Adelaide SA 5001 Level 5 115 Grenfell Street Adelaide SA 5000 Telephone 1300 556 161 Facsimile (08) 8236 2305 Email Website www.computershare.com [email protected] Responsible Entity Management Limited Macquarie Goodman Funds ABN 48 067 796 641 Registered Office Level 10 60 Castlereagh Street Sydney NSW 2000 Telephone 1300 791 100 Facsimile (02) 9230 7444 Email Website www.macquariegoodman.com.au/mgi Directors Mr David Clarke, AO (Chairman) Deputy Chairman) Dodd (Independent Dr Peter Mr Gregory Goodman (Chief Executive Officer) CBE (Independent Director) AO, Mr James Kennedy, (Independent Director) Wood Ms Lynette Chief Operating Officer Mr David van Aanholt General Counsel and Company Secretary Ms Carolyn Scobie Chief Financial Officer and Company Secretary Mr Mark Alley Manager Fund Mr Nick Kurtis Corporate Communications Manager Ms Jayne Gerrie Macquarie Goodman Industrial Trust Macquarie Goodman ARSN 091 213 839 Corporate Directory Corporate Macquarie Goodman Industrial Trust is Australia’s largest industrial property trust listed on the Australian Stock Exchange. Its objective is to deliver a liquid stock to its Unitholders with secure income returns and potential for long-term capital growth.

The Trust specialises in warehouse/distribution centres, industrial estates, business parks and office parks. Its key strategy is to invest in premium industrial space positioned close to major road networks, infrastructure and amenities to attract blue chip customers. Term Definition or Explanation MGCT Macquarie Goodman Capital Trust It provides complete and inspired property solutions by (ARSN 100 155 986) developing lasting partnerships and delivering superior property related services and products to its customers. MGI or the Trust Macquarie Goodman Industrial Trust (ARSN 091 213 839) and its controlled entities, as the context requires. MGI’s Constitution The Constitution establishing MGI dated 13 December 1989, as amended. MGI’s portfolio All properties held by MGI and its subtrusts. MGM Macquarie Goodman Management Limited (ABN 69 000 123 071) NTA Net tangible assets Record date The day MGI’s register is closed for the purpose of determining a Unitholder’s entitlement to the forthcoming distribution. RePS Reset Preference Units in MGCT Contents Responsible Entity Responsible Entity means a public company that holds a dealer’s licence authorising it to operate a managed 1. Investor Highlights 1 7. Investor Relations 53 investment scheme. In respect of Macquarie Goodman 2. Responsible Entity’s Report 4 8. Other Trusts Managed by Industrial Trust, the Responsible Entity is MGF, a wholly Macquarie Goodman 54 owned subsidiary of MGM. 3. Directors’ Report to Unitholders 21 9. Trusts Managed by Associates of SGX Singapore Exchange 4. Financial Report 24 Macquarie Goodman 55 UPP Unitholder Purchase Plan 5. Independent Review Report to Unitholders 50 10. Glossary of Terms 56 Yield The percentage return on the asset value. 6. ASX Additional Information 52 Corporate Directory OBC

This Report for the half year ended 31 December 2002 has been prepared by Macquarie Goodman Funds Management Limited (ABN 48 067 796 641) as the Responsible Entity for Macquarie Goodman Industrial Trust (“MGI”) (ARSN 091 213 839) . Whilst every care has been taken in relation to its accuracy, no warranty is given or implied. The information provided is not investment advice and recipients should consider obtaining independent advice before making any decision that relies on this information. All values are expressed in

Australian currency. February 2003. DESIGNED AND PRODUCED BY IMPRESS DESIGN 1Investor Highlights

> Net profit up 21.3% from $40.50 million to $49.12 million.

> Distributions up 3.1% from 5.90 cents to 6.08 cents per unit.

> Total assets up 54.1% from $1.36 billion to $2.09 billion.

> Net tangible assets up 4.8% from $1.24 to $1.30 per unit.

> Unit price up 1.4% from $1.44 to $1.46 per unit.

> Leased 50,000 sqm of existing space.

> Precommitted 60,000 sqm of new space.

> Acquired 11 properties totalling $292 million.

“The Trust’s market capitalisation increased by 29% over the period, cementing its status as Australia’s largest listed industrial property trust.”

> Total return of 17.1% per annum over the past three years. GROWTH IN NET TANGIBLE ASSETS AND > Announced a Unitholder Purchase Plan. DISTRIBUTIONS PER UNIT 1.32 6.2 > Enhanced position as Australia’s 11th largest listed property trust. 1.30 1.28 6.0 > Increased ranking to number 84 in the top 100 listed vehicles 1.26 in Australia. 1.24 5.8 1.22 The above highlights compare to the previous corresponding half year period. 1.20 5.6 1.18 1.16 5.4 1.14 1.12 5.2 1.10 1.08 5.0 $ cpu Jun 2001 Jun 2002 Jun 2000 Dec 2001 Dec 2000 Dec 1999 Dec 2002

NTA DPU 1 1Investor Highlights

RESULTS OVERVIEW

For the half year ended 31 Dec 2002 31 Dec 2001 Change

Net profit attributable to Unitholders ($M) 49.12 40.50 21.3%

Distribution to Unitholders ($M) 49.12 40.50 21.3%

Basic earnings per unit (¢) 5.91(1) 5.97 (1.0%)

Distributions per unit (¢) 6.08(1) 5.90 3.1%

Management Expense Ratio (%) 0.52 0.55 (5.5%)

Total assets ($M) 2,087.98 1,355.15 54.1%

Total borrowings ($M) 624.49 354.83 76.0%

Total Unitholders’ equity ($M) 1,235.33 925.64 33.5%

Market capitalisation ($M) 1,386.05 1,070.72 29.5%

Total borrowings to total assets (%) 29.91 26.18 14.2%

Net tangible asset backing per unit ($) 1.30 1.24 4.8%

Unit price ($) 1.46 1.44 1.4%

Number of units on issue (M) 949.35 743.55 27.7%

Number of Unitholders 14,021 10,673 31.4%

Distribution yield (%) 8.32 8.19 1.6%

(1) The accounting standards require units issued during the period to be included in the EPU calculation from the date of issue rather than when the units are entitled to distribution. Placements made in September 2002 and December 2002 rank for distribution purposes from October 2002 and January 2003 respectively, resulting in EPU being lower than DPU. If the accounting standards enabled EPU to be calculated from when the units are entitled to distribution rather than when they were issued, then EPU and DPU would be the same. 2 MGI CONTINUES TO RETAIN AND ATTRACT BLUE CHIP CUSTOMERS TO ITS PORTFOLIO WITH 110,000 SQM LEASED OVER THE PAST SIX MONTHS.

Toll Ipec’s new facility at MFive Industry Park, Moorebank, NSW. 2Responsible Entity’s Report

Introduction

It has been another definitive half year for MGI with net profit increasing 21% compared to the previous corresponding period. Distribution increased 3% to 6.08 cents per unit, while the portfolio grew 54% to $2.1 billion.

MGI’s market capitalisation increased by 29% over the period, cementing its status as Australia’s largest listed industrial property trust. Its position in the listed property trust sector also improved to 11 and its ranking in the top 100 listed vehicles in Australia

Mr David van Aanholt strengthened to 84. Chief Operating Officer Unitholders have benefited from a total return over the past three years of 17.1% per annum, which compares favourably to the UBS-W Industrial 200 Accumulation Index of 15.0% and S&P/ASX 200 Property Accumulation Index of 14.7%.

MGI TOTAL RETURN VERSUS UBS-W INDUSTRIAL 200 ACCUMULATION INDEX AND S&P/ASX 200 PROPERTY ACCUMULATION INDEX

160

150

140

Index 130

120

110

100

90 Apr 00 Apr 01 Apr 02 Oct 02 Oct 00 Oct 01 Jun 02 Jun 01 Jun 00 Feb 01 Feb 02 Feb Feb 00 Feb Aug 01 Aug 02 Aug 00 Dec 02 Dec 01 Dec 99 Dec 00

MGI Total Return UBS-W Industrial S&P/ASX 200 Property 4 200 Accumulation Index Accumulation Index

Source: UBS Warburg MGI made several significant acquisitions during the period, including a $206.8 million property portfolio from Linfox Property Group. This transaction reflects our strategy of acquiring properties in well located areas. It also adds a competitive advantage to our existing portfolio with the ability to offer a full range of space solutions for our customers.

Customer service is key to our business and results in competitive returns for our Unitholders. By partnering with our customers, we aim to build lasting relationships and deliver a packaged solution to them, while developing strength in MGI’s portfolio. Mr Nick Kurtis Leasing activities have continued to grow strongly over the half year Fund Manager period. The property services team has leased 110,000 sqm of existing or new space. This included accommodating customers such as AAB Holdings, ACI, AUSDOC, Boots Healthcare, Chubb Securities, Linfox Property Group, Rumortex, Seven Worldwide, Stramit Corporation and Synnex Australia.

October 2002 marked two years since the creation of MGI through the merger of Goodman Hardie Industrial Property Trust and Macquarie Industrial Trust. While those involved in the merger have obviously brought great success to MGI, it was timely to make the Board more independent to ensure corporate governance best practice.

As a result, a majority of directors on our new Board are independent of Macquarie Goodman Management Limited. They are:

> Mr David Clarke, AO, Chairman;

> Dr Peter Dodd, Independent Deputy Chairman;

> Mr Gregory Goodman, Chief Executive Officer;

> Mr James Kennedy, AO, CBE, Independent Director; and

> Ms Lynette Wood, Independent Director.

5 2Responsible Entity’s Report

We welcome Ms Wood as a new member to the Board. She has been involved with MGI as an external member of its Compliance Committee since January 2000. She is also a member of the Foreign Investment Review Board, Director of the MS Society of NSW, Chairman of Hands Pty Ltd and President-Elect of Women Chiefs of Enterprises-International (NSW Division).

Ms Wood will be replaced by a new external member on MGI’s Compliance Committee.

Customers Secure Premium Space The recently refurbished Talavera Business Park at North Ryde in We position MGI’s portfolio towards multi-tenanted industrial estates, NSW has attracted three new customers. business parks and office parks, with the vast majority of our development pipeline designed along these lines. We believe these WEIGHTED AVERAGE LEASE EXPIRY PROFILE assets provide customers with greater lease flexibility and allow us to leverage our funds management expertise. 50

45 Leasing activities have continued to exceed expectations over the half year period. This success has assisted to maintain MGI’s historically 40 high occupancy rate of 98%. Approximately 50,000 sqm of space has 35 been leased on the underlying portfolio equating to approximately

30 $7 million of net annual property income. The leases were negotiated on rents that reflect an increase of 3% over passing rents. 25 MGI’s weighted average lease term is 5.6 years, following the 20 acquisition of interests in the portfolio from Linfox Property Group. A 15 boost in this lease term is anticipated with the gradual repositioning 10 of this portfolio.

5 A summary of the lease transactions on the existing portfolio during

0 the past six months appears on the opposite page. % <1 >5 1-2 2-3 3-4 4-5

Years

6 Property Customer Area Term sqm years Wedgewood Business Rumortex 4,271 3 Park, Hallam, Vic Perry Exhaust 3,917 3 Biloela Industrial Estate, Australia Post 4,728 1.5 Villawood, NSW E-Fill (Shell) 2,818 3 Bonds Distribution AAB Holdings 5,997 2 Centre, Punchbowl, NSW Homebush Corporate Sussan 4,215 3 Park, Homebush, NSW Corporation Cambridge Office Park, Chubb Securities 3,552 Monthly(1) Epping, NSW Lidcombe Business Synnex Australia 2,726 3 Park, Lidcombe, NSW Nuturf 678 6 TransTech Business Cap-XXX 1,826 3 Park, Lane Cove, NSW Red Ant 663 5 Premier Products 350 3 Macquarie Corporate Boots Healthcare 2,075 6 Park, North Ryde, NSW Berger Software 652 6 Hurstville Office Park, NRMA 861 3 Hurstville, NSW Sydney Anglican Schools 558 5 Westpac 504 1 Ashfield Corporate NSW Land and 1,205 5.8 Centre, Ashfield, NSW Housing Corporation 679 5.8 The Precinct Corporate Seven Worldwide 1,290 5 Centre, North Ryde, NSW EnGeneIC 400 3 Talavera Business Park, Cordukes 698 5 North Ryde, NSW Spectris 313 3 Wallace & Tiernan 300 5 Waterloo Business Park, BTAS 820 5 North Ryde, NSW Beeby Marketing 170 4 Warringah Corporate Rochios Café 310 2 Centre, Frenchs Forest, NSW Interlock IT 202 5 Photocorp 147 3 Triathlon Australia 125 3 Central Park Corporate Toshiba 372 6 Centre, Greenlane, Auckland, NZ

(1) Subsequent to the balance date, Chubb Securities signed a three year lease.

7 2Responsible Entity’s Report

TOP 20 CUSTOMERS BY NET INCOME

4.5

4.0

3.5

3.0

2.5

2.0

1.5

1.0

0.5

0.0 % To l l ACI CBA CSC Patrick ResMed Brambles Fuji Xerox Fuji Woolworths Network Ten TNT Australia Kmart Australia Paper Merchant Paper Hewlett-Packard Coca-Cola Amatil Carter Holt Harvey Laminex Industries Linfox Property Group Eagle Global Logistics NSW Land and Housing

8 Acquisitions Increase Quality and Volume

Linfox Purchase Adds to Earnings Potential

The most significant event for MGI over the half year period was the acquisition of interests in five properties from Linfox Property Group for $206.8 million. The properties are currently returning an attractive yield, however, there is further scope for improvement through development and leasing.

Our proven track record of acquiring and improving the tenure and quality of assets will benefit this portfolio greatly as well as assist in optimising returns to Unitholders.

The portfolio is located in established industrial precincts and benefits from access to major roads, rail and employment zones. It comprises one property in Sydney, one in Brisbane, two in Melbourne and one in Auckland, New Zealand.

Smithfield Distribution Centre in Smithfield, NSW acquired from Linfox Property Group in December 2002. 9 2Responsible Entity’s Report

Expanding our Presence in Auckland

MGI acquired one of Auckland’s largest office parks for $45.7 million in October 2002. The property is known as Central Park Corporate Centre and is located in an established office park precinct, 10 kilometres south of the Auckland CBD in New Zealand. It comprises 6.2 hectares with nine buildings totalling 25,244 sqm of lettable area and 1,266 car parking spaces.

The current zoning approval for the site allows for the development of a further 24,500 sqm of commercial space, the infrastructure for which

Central Park Corporate Centre is already in place. On completion, the property is anticipated to in Greenlane is one the largest represent a $90 million investment. Current occupants include one of office parks in Auckland, NZ. MGI’s existing customers Boots Healthcare as well as Armourguard, Avis, Roche Vitamins and The Simpl Group.

Sydney Portfolio Grows

Location was a main drawcard for the two industrial unit complexes acquired from Lend Lease Real Estate Partners for $21.1 million in November 2002.

The first property, Homebush Bay Industrial Estate, is a recently refurbished unit complex located on Hill Road in the heart of the Olympic precinct, some 15 kilometres west of the Sydney CBD. The purchase price of $10.3 million reflects an initial yield of 9.5%. The property contains five high clearance warehouse units with associated office space. It has a total lettable area of 8,935 sqm and a site area of 1.2 hectares. The vendor has provided a 12 month rental guarantee over the vacant areas.

The second property is Orion Business Park, which is located in the established lower North Shore industrial precinct of Lane Cove, around 10 kilometres north west of the Sydney CBD. It is close to Orion Business Park in Lane MGI’s TransTech Business Park, one of the leading business parks in Cove, NSW was acquired in November 2002. the precinct attracting strong rents.

10 The property comprises a modern industrial unit complex with a total ASSET CLASS DIVERSIFICATION lettable area of 6,507 sqm and associated office content. The Other Warehouse/ purchase price of $10.8 million reflects an initial yield of 9.9%. This Office 3% Parks Distribution property offers an alternate profile and price point for MGI’s customers 26% Centres 27% on the lower North Shore.

Developments Enhance MGI’s Portfolio Industrial Business Estates The development pipeline continues to add extensive value to MGI. Parks 14% Not only have we completed or progressed a number of premium 30% projects, we have also secured many precommitments to house leading corporates on behalf of MGI. GEOGRAPHIC Precommitments Lift MGI’s Customer Profile in NSW DIVERSIFICATION New Zealand Homebush Corporate Park, 1–15 Carter Street and 6% Queensland Other Lot 23 Uhrig Street, Homebush, NSW 3% 1% NSW Rural Fire Service has set the tone for the redevelopment of this Victoria 16% property into an impressive campus-style office park. It has committed for 10 years to 5,800 sqm with 191 car parking spaces and a 20 truck capacity staging area. This transaction is conditional upon receiving New South relevant authority consents. Wales 74% The facility is estimated to cost approximately $20.0 million, including land, yielding in excess of 9.0% on completion. The precommitment from NSW Rural Fire Service comprises Stage 1 of the redevelopment of this property. It also highlights the suitability of Homebush as an office park precinct and is a great start for what will be a major asset of MGI.

11 2Responsible Entity’s Report

Lidcombe Business Park, Lidcombe, NSW

Lidcombe Business Park, Cnr Parramatta Road and Birnie Avenue, Lidcombe, NSW

This property continues to be a success story for MGI with the remaining warehouse space of 2,700 sqm in Building B recently leased to Synnex Australia, a world class leader in information technology and telecommunication distribution.

Building A is currently under development and is scheduled for completion at the end of February 2003. It comprises 7,300 sqm of quality office, showroom and warehouse space and, given its excellent exposure to Parramatta Road, we are confident that this building will be leased in the short term.

With the further strengthening of our customer base, Maxwell Optical has launched Building F with a precommitment for 3,800 sqm for five years.

Building F will comprise 10,600 sqm of lettable area and will complement the balance of the estate. The total development cost for this stage will be $14.7 million including land or $9.6 million of additional capital expenditure, yielding in excess of 9.0% on completion.

12 Campus Business Park, 350 Parramatta Road, Homebush, NSW

The development of the next 17,230 sqm stage of Campus Business Park is progressing with completion scheduled for June 2003. Following the completion of the 12,080 sqm warehouse/distribution facility for UPS Logistics Group, we have had strong enquiries for the new building.

GreystanesPark East and West, 40–42 and Lot 502 Clunies Ross Street, Greystanes, NSW

Laminex Industries’ 28,000 sqm facility at GreystanesPark East is Campus Business Park, progressing as scheduled, with completion anticipated towards the Building C at Homebush in NSW is fully occupied by UPS end of 2003. On completion, Laminex Industries will enter into a Logistics Group. 10 year lease with an annual net commencing rental of $2.4 million. We are currently negotiating with prospective customers for the balance of GreystanesPark East.

In June 2002, MGI secured GreystanesPark West for $19.5 million with settlement deferred until the end of February 2003. The encouraging level of market interest in the Greystanes Business Hub ensures the continued success of this strategic acquisition.

Erskine Park Industrial Estate, Cnr Mamre and Erskine Park Roads, Erskine Park, NSW

In November 2002, MGI acquired a 27.9 hectare parcel of land for $11.25 million with $8.0 million estimated to be spent over the next 13 months to develop the land.

As part of the transaction, a 33% precommitment was secured from Stramit Corporation, one of Australia’s leading manufacturers of steel building products. Stramit Corporation will occupy a 17,500 sqm warehouse/distribution facility for 10 years. An additional 70,000 sqm of lettable area is estimated to be developed over the next five years along with joint venture partner, McRoss Developments.

13 2Responsible Entity’s Report

MFive Industry Park, 1 Moorebank Avenue, Moorebank, NSW

In September 2002, MGI secured a 14,800 sqm precommitment from AUSDOC for 15 years for a new warehouse facility, with an annual net commencing rental of $1.5 million. The facility also provides 14,500 sqm of expansion space that will be developed on an “as needs” basis.

AUSDOC will relocate some of its business activities from Alexandria to the larger, tailor-made document storage facility at MFive Industry Park. One of the attractions of this property for AUSDOC was the

Toll Ipec is just one of the ability to expand its warehousing requirements in line with its customers benefiting from business needs. MFive Industry Park’s strategic location in Moorebank, NSW. The completion of the development of Toll Ipec’s facility, the refurbishment of Victa Lawncare’s facility and the commitment from AUSDOC have ensured the success of this estate, with two parcels remaining for further development.

Talavera Corporate Centre, 12–38 Talavera Road, North Ryde, NSW

The 21,000 sqm purpose-built, high-tech facility for CSC is progressing as scheduled with practical completion expected in November 2003. This first stage is being developed in conjunction with CRI and represents one of the largest precommitments in North Ryde’s history.

The lease to CSC is for 10 years with an annual net commencing rental of $6.4 million. This office park will set a new benchmark in respect of quality and technology for the North Ryde market.

14 MGI’s Weighting to Victoria Grows

Chifley Industry Park, Centre Dandenong Road, Moorabbin, Vic

The second facility for Coca-Cola Amatil of 27,300 sqm is nearing completion. It will occupy its new facility on a 10 year lease with an annual net commencing rental of $1.3 million, generating an initial yield of 9.8%.

The allure of Chifley Industry Park continues with Storpak being the latest customer to benefit from this exciting estate. This marketing support services company committed in December 2002 to a Chifley Industry Park at 7,000 sqm purpose-built facility for 10 years. Its annual net Moorabbin, Vic is thriving with commencing rental is $0.5 million. The facility will be developed for new facilities progressing for Coca-Cola Amatil and Storpak. $4.2 million with completion due later this year.

We are also proposing to develop a 20,000 sqm multi-tenant estate over two stages at Chifley Industry Park. Stage 1 will comprise approximately 10,000 sqm and commence when a precommitment of 35% is obtained. We believe there is an opportunity in this market given the limited availability of flexible product catering for between 1,000 sqm to 4,000 sqm.

Laverton Distribution Centre, 13–19 William Angliss Drive, Laverton North, Vic

Practical completion was reached on ACI’s 50,841 sqm warehouse/ distribution centre on 3 October 2002. ACI will utilise the facility for its glass bottle storage business and has around 16,500 sqm of further expansion space if required.

ACI has entered into a new 12 year lease with an annual net commencing rent of $2.2 million, reflecting an initial yield of 9.0% on total development costs. The quality of the development resulted in a valuation of $27.3 million.

15 2Responsible Entity’s Report

Portfolio Diversification in Queensland

Lytton Distribution Centre, 67 and 77 Trade Street, Lytton, Qld

In October 2002, we secured a 2.2 hectare site at Lytton for $1.8 million, with an 8,500 sqm precommitment from ACI for its PET manufacturing plant. The proximity to one of its major customers, Berri, and our strong ongoing relationship were integral in ACI’s decision to commit to this project.

On completion, ACI will enter into a 10 year lease with an annual net commencing rental of $0.7 million. The total development costs for The Gate Industry Park in Penrose, Auckland, NZ has MGI are anticipated to be $6.7 million. attracted many blue chip customers. Queensport Quays Business Park, Metroplex Avenue, Murarrie, Qld

In October 2002, MGI acquired a 7.9 hectare site in the successful Metroplex on Gateway project in the Brisbane suburb of Murarrie. The property will accommodate approximately 40,000 sqm of lettable space to be developed in stages under a joint venture arrangement with Silvada and Metroplex Management, a wholly owned subsidiary of Pradella Group.

The site was acquired for $5.5 million with MGI to spend an additional $4.5 million on servicing, infrastructure and subdivision of the estate over the next two years. The property is located adjacent to the Gateway Bridge, just seven kilometres east of the Brisbane CBD. It is well located to the Port of Brisbane, Brisbane Airport and major arterial roads.

New Zealand Property Shines

The Gate Industry Park, 373 Neilson Street, Penrose, Auckland, New Zealand

Acquired in late May 2002 with Carter Holt Harvey as the anchor customer, this project now includes customers such as B J Ball Papers, Rapak and Yates. 16 In November 2002, BOC Gases committed to 2,793 sqm in Stage 2 of the development. The annual net commencing rental is $0.21 million on a lease term of 10 years. The total development costs, including land, are anticipated at $2.0 million equating to a yield of 10.5%.

Revaluations Lift the Portfolio

The revaluation of 12 of MGI’s properties led to a $5.6 million increase over the half year.

The main increases were Laverton Distribution Centre in Laverton North, Victoria up $2.5 million and Southend Distribution Centre in Southend Distribution Centre in Mascot, NSW up $5.1 million. The strategy of owning and developing Mascot, NSW increased 18% to $33 million as a result of the quality assets in strategic locations for our customers has added latest revaluation. growth to MGI’s portfolio as evidenced by the positive revaluations.

Managing MGI’s Finances

Placements Allow for Portfolio Expansion

We completed an institutional placement of $116.2 million in September 2002 for MGI, issuing 84.8 million units at $1.37 per unit. The placement increased MGI’s market capitalisation to $1.2 billion and was jointly underwritten by UBS Warburg and JBWere.

The purpose of that placement was to fund eight development projects that will house customers such as ACI, Coca-Cola Amatil, CSC, Laminex Industries, Rapak and Yates. It also enabled us to efficiently manage our capital requirements and support our successful strategy of continuing to roll out MGI’s development book, without decreasing distributions or earnings.

In December 2002, we funded the acquisition of the portfolio from Linfox Property Group via a combination of a second institutional placement raising $134.8 million and bank debt. UBS Warburg and JBWere jointly placed 95 million units at $1.42 per unit.

17 2Responsible Entity’s Report

MGI’s Distribution Reinvestment Plan is being underwritten for the quarters ending 31 December 2002, 31 March 2003 and 30 June 2003. The DRP will be underwritten by JPMorgan and is estimated to raise $85 million over that period to assist in funding ongoing developments.

Funding of the acquisition of the portfolio from Linfox Property Group as well as our capital commitments, resulted in an increased gearing CAPITAL RAISING ISSUE PRICE level of 29.9% as at 31 December 2002.

2,400 1.46 The two institutional placements have reinforced MGI’s position in the listed property trust sector and its ranking within the top 100 listed 2,200 1.44 vehicles in Australia. 2,000 1.42 Unitholder Purchase Plan 1,800 1.40 The latest Unitholder Purchase Plan was offered to Unitholders on 1,600 17 February 2003. The UPP allows our Unitholders to participate in a 1.38 1,400 capital raising at an issue price of $1.42 per unit, being a discount of 1.36 5.8% on MGI’s volume weighted average price from 24 January 2003 1,200 to 7 February 2003 inclusive. The issue price is the same as the 1.34 1,000 institutional placement that occurred in December 2002.

800 1.32 We are dedicated to expanding any opportunities that add value to our Unitholders’ investment. We expect a high level of participation 600 1.30 $M cpu given the support received from our retail investors in the last UPP. Eligible Unitholders were invited to invest up to $5,000 worth of Oct 2001 Sep 2002 Dec 2001 Dec 2002 additional units. The offer opened on 18 February 2003 and closes Property Issue Portfolio Price on 19 March 2003.

18 Outlook for 2003

Importantly, the achievements over the half year ended 31 December 2002 have allowed us to increase our forecast distributions to Unitholders from 12.15 cents to 12.30 cents per unit annualised for the six months ending 30 June 2003.

We have a positive outlook for 2003. Our dedicated team is committed to continuing the outstanding performance of MGI’s portfolio by delivering wide-ranging solutions and superior products to our customers. This in turn, will reinforce customer retention as well as attracting new customers to the portfolio.

We will progress the extensive development pipeline to further enhance the quality of the portfolio and endeavour to capture further valuable partnerships such as those with ACI, Linfox and AUSDOC, where we have been retained as their preferred property partners.

Finally, Unitholders have seen their Trust grow by 54% compared to the previous corresponding period. Over the next six months, our team will continue to build Unitholder wealth and enhance capital growth.

Australian icon, the Victa lawnmower, in production at MFive Industry Park, Moorebank, NSW. 19 Financials

Directors’ Report to Unitholders 21 Financial Report 24 Financial Statements 24 – Statement of Financial Performance 24 – Statement of Financial Position 26 – Statement of Cash Flows 27 Notes to the Financial Statements 28 1. Statement of Significant Accounting Policies 28 2. Net Profit 30 3. Distributions 31 4. Earnings per Unit 31 5. Investment Properties 32 6. Contributed Equity 46 7. Non-cash Financing and Investing Activities 48 8. Segment Reporting 48 9. Acquisition of Controlled Entities 48 Directors’ Declaration to Unitholders 49 Independent Review Report to Unitholders 50 20 Directors’ Report 3to Unitholders

Directors’ Report to Unitholders

The directors of Macquarie Goodman Funds Management Limited (“Macquarie Goodman”), the Responsible Entity for Macquarie Goodman Industrial Trust (“MGI”), present their report together with the Financial Report of MGI and its controlled entities (“Consolidated Entity”) for the half year ended 31 December 2002 (“period”) and the review report thereon.

1. Directors The following persons have held office as directors of Macquarie Goodman during the period and up to the date of this report: Mr David Clarke, AO Appointed 26 October 2000 Chairman Dr Peter Dodd Appointed 8 February 1995 Independent Deputy Chairman Mr Gregory Goodman Appointed 17 January 1995 Chief Executive Officer Mr James Kennedy, AO, CBE Appointed 26 October 2000 Independent Director Ms Lynette Wood Appointed 30 December 2002 Independent Director Mr Michael Easson, AM Appointed 26 October 2000 Independent Director Resigned 1 November 2002 Dr David Teplitzky Appointed 21 December 1999 Independent Director Resigned 24 January 2003 Mr Patrick Goodman Appointed 26 October 2000 Non-Executive Director Resigned 24 January 2003 Mr William Moss Appointed 26 October 2000 Non-Executive Director Resigned 24 January 2003 Mr James Hodgkinson Appointed 13 June 2001 Non-Executive Director Resigned 24 January 2003 Mr Stephen Girdis Appointed 12 December 2000 (Alternate for Mr David Clarke) Resigned 24 January 2003 21 Directors’ Report 3to Unitholders

Directors’ Report to Unitholders (cont.)

2. Distributions The distribution of income for the period was 6.08 (2001: 5.90) cents per unit. Further details of distributions paid during the period are set out in Note 3 to the Financial Statements.

3. Review of Operations The performance of the Consolidated Entity, as represented by the results of its operations for the period, was as follows: Consolidated 31 Dec 2002 31 Dec 2001 $000 $000 Gross property income 78,199 60,659 Net profit attributable to Unitholders of MGI 49,117 40,504

4. Value of Assets Consolidated 31 Dec 2002 30 Jun 2002 $000 $000 Value of the Consolidated Entity’s assets 2,087,976 1,676,947 The value of the Consolidated Entity’s assets is derived using the basis set out in Note 1 to the Financial Statements.

5. Units on Issue The movement in units on issue in MGI during the period is set out below: Consolidated 31 Dec 2002 30 Jun 2002 Ordinary units issued during the period 192,221,960 102,618,209 Ordinary units on issue 949,352,157 757,130,197

22 Directors’ Report to Unitholders (cont.)

6. Rounding Off MGI is a registered scheme of a kind referred to in ASIC Class Order 98/100 dated 10 July 1998 and in accordance with that Class Order, amounts in the Financial Report and Directors’ Report have been rounded off to the nearest thousand dollars, unless otherwise stated. This report is made in accordance with a resolution of the directors.

David Clarke, AO Chairman

Gregory Goodman Director Sydney, 5 February 2003

23 4Financial Report

Statement of Financial Performance For the half year ended 31 December 2002

Note Consolidated 31 Dec 2002 31 Dec 2001 $000 $000 Revenue from ordinary activities Gross property income 78,199 60,659 Other income 2 1,965 42,122 Total revenue 80,164 102,781 Property expenses (12,603) (8,265) Borrowing costs 2 (8,273) (8,830) Trust expenses (1,145) (891) Management base fee (4,164) (2,803) Cost of investment properties sold 2 (1,191) (41,488) Total expenses (27,376) (62,277) Share of net profit from associated entity 1,579 – Net profit 54,367 40,504 Net profit attributable to outside equity interests (RePS) (5,250) – Net profit attributable to Unitholders of MGI 49,117 40,504 Non-owner transaction changes in equity Increase in reserves 5,578 9,370 Net exchange differences recognised in equity 262 – Total transactions and adjustments recognised directly in equity 5,840 9,370 Total changes in equity from non-owner related transactions attributable to Unitholders of MGI 54,957 49,874

24 Statement of Financial Performance (cont.) For the half year ended 31 December 2002

Note Consolidated 31 Dec 2002 31 Dec 2001 $000 $000 Net profit attributable to Unitholders of MGI 49,117 40,504 Undistributed income at the beginning of the financial period 5 1 Undistributed income at the end of the financial period (4) (5) Distribution paid to or provided for the Unitholders of MGI 3 49,118 40,500 Basic earnings per unit (¢) 4 5.91 5.97 Diluted earnings per unit (¢) 4 5.91 5.97 Distribution per unit (¢) 3 6.08 5.90 The Statement of Financial Performance is to be read in conjunction with the accompanying notes.

25 4Financial Report

Statement of Financial Position As at 31 December 2002

Note Consolidated 31 Dec 2002 30 Jun 2002 $000 $000 Current assets Cash assets 2,141 11,184 Receivables 15,204 15,889 Other 2,795 4,351 Total current assets 20,140 31,424 Non-current assets Receivables 2,745 1,322 Investment properties 5 2,023,966 1,603,360 Investments accounted for using the equity method 34,000 34,000 Other 7,125 6,841 Total non-current assets 2,067,836 1,645,523 Total assets 2,087,976 1,676,947 Current liabilities Payables 46,707 60,423 Provisions 28,579 22,351 Interest bearing liabilities 186,301 – Total current liabilities 261,587 82,774 Non-current liabilities Payables 17,503 7,232 Interest bearing liabilities 438,192 487,058 Total non-current liabilities 455,695 494,290 Total liabilities 717,282 577,064 Net assets 1,370,694 1,099,883

Equity Contributed equity 6 1,160,977 895,903 Reserves 74,348 68,508 Undistributed income 4 5 Total parent equity interest 1,235,329 964,416 Outside equity interest (RePS) 135,365 135,467 26 Total equity 1,370,694 1,099,883 The Statement of Financial Position is to be read in conjunction with the accompanying notes. Statement of Cash Flows For the half year ended 31 December 2002

Consolidated 31 Dec 2002 31 Dec 2001 $000 $000 Cash flows from operating activities Property income received 92,492 76,064 Property expenses paid (30,353) (30,554) Distribution received from associated entity 1,579 – Interest and other borrowing costs paid (15,242) (8,346) Interest received 775 72 Net cash provided by operating activities 49,251 37,236 Cash flows from investing activities Payments for investment properties and developments (401,997) (194,377) Proceeds from sale of investment properties 1,190 42,428 Loans repaid to associated entity (1,423) – Net cash used in investing activities (402,230) (151,949) Cash flows from financing activities Proceeds from issue of units to Unitholders of MGI 268,764 120,598 Issue costs paid (7,555) (1,403) Proceeds from borrowings 169,750 403,300 Repayment of borrowings (37,997) (368,100) Distributions paid – Ordinary Unitholders (45,515) (37,790) – RePS holders (3,603) – Net cash provided by financing activities 343,844 116,605 Net (decrease)/increase in cash held (9,135) 1,892 Cash at the beginning of the financial period 11,184 2,415 Effects of exchange rate fluctuations on the balances of cash held in foreign currencies 92 – Cash at the end of the financial period 2,141 4,307

The Statement of Cash Flows is to be read in conjunction with the accompanying notes. 27 4Financial Report

Notes to the Financial Statements For the half year ended 31 December 2002

1. Statement of Significant Accounting Policies The significant policies that have been adopted in the preparation of this Financial Report are:

(a) Basis of Preparation The half year consolidated financial report is a general purpose financial report that has been prepared in accordance with Australian Accounting Standard AASB 1029 “Interim Financial Reporting”, the recognition and measurement requirements of applicable Australian Accounting Standards Board, Urgent Issues Group Consensus Views, other authoritative pronouncements of the Australian Accounting Standards Board, the Corporations Act 2001 and the requirements of MGI’s Constitution dated 13 December 1989, as amended. This half year report is to be read in conjunction with the 30 June 2002 Annual Financial Report and any public announcements by MGI during the half year in accordance with continuous disclosure obligations arising under the Corporations Act 2001. It has been prepared on the basis of historical costs and, except where stated, does not take into account changing money values or fair values of non-current assets. These accounting policies adopted are consistently applied by each entity in the Consolidated Entity and, except where there is a change in accounting policy, are consistent with those applied in the 30 June 2002 Annual Financial Report. Where necessary, comparative information has been reclassified to achieve consistency in disclosure with current financial period amounts and other disclosures.

(b) Investment Properties Investment properties comprise investment interests in land and buildings (including integral plant and equipment) held for the purpose of letting to produce rental income. Land and buildings (including integral plant and equipment) comprising investment properties, are regarded as composite assets and are disclosed as such in the Financial Report. 28 Notes to the Financial Statements (cont.) For the half year ended 31 December 2002

1. Statement of Significant Accounting Policies (cont.)

(b) Investment Properties (cont.) When a contract of purchase includes a deferred settlement arrangement, the acquisition value is determined as the cash consideration payable in the future, discounted to present value at the date of acquisition. The fair value basis is used to measure the carrying amount of investment properties. An independent valuation of investment properties is obtained at least every three years to use as a basis for measuring the fair value of the properties. The independent registered valuer determines the market value based on a willing, but not anxious, buyer and seller, a reasonable period to sell the property, and that the property is reasonably exposed to the market. Where an investment property is acquired, the property is carried at cost which includes the costs of acquisition. At report dates occurring between obtaining independent valuations, the directors review the carrying value of the Consolidated Entity’s investment properties to be satisfied that, in their opinion, the carrying value of the investment properties is not materially different to the fair value of the investment properties at that date. Revaluation increments are credited directly to an asset revaluation reserve. Revaluation decrements are taken directly to the asset revaluation reserve to the extent that such decrements are covered by amounts previously credited to that reserve and still available in that reserve. Revaluation decrements in excess of amounts available in the reserve are charged to the Statement of Financial Performance. Subsequent revaluation increments that recover amounts previously charged to the Statement of Financial Performance are, to that extent, credited to the Statement of Financial Performance.

29 4Financial Report

Notes to the Financial Statements (cont.) For the half year ended 31 December 2002

1. Statement of Significant Accounting Policies (cont.)

(b) Investment Properties (cont.) Disposal of Revalued Assets The gain or loss on disposal of previously revalued properties is calculated as the difference between the carrying amount of the property at the time of the disposal and the proceeds on disposal and is included in the Statement of Financial Performance in the period of disposal. Any related revaluation increment in the asset revaluation reserve at the time of disposal is transferred to the capital profits reserve.

2. Net Profit Consolidated 31 Dec 2002 31 Dec 2001 $000 $000 (a) Other Revenue from Ordinary Activities Revenue from outside operating activities Proceeds from investment properties sold 1,190 42,050 Interest income 775 72 1,965 42,122 Expenses from outside operating activities Cost of investment properties sold (1,191) (41,488) Net other income 774 634

(b) Borrowing Costs Borrowing costs 15,747 10,389 Capitalised borrowing costs (7,474) (1,559) 8,273 8,830

30 Notes to the Financial Statements (cont.) For the half year ended 31 December 2002

3. Distributions Distribution Total amount cpu $000 Distributions paid or proposed by MGI are: 2002 distributions for the quarter ended 30 September 2002(1) 3.04 23,180 31 December 2002(1) 3.04 25,938 6.08 49,118

2001 distributions for the quarter ended 30 September 2001(1) 2.95 19,511 31 December 2001(1) 2.95 20,989 5.90 40,500

(1) Unitholders were able to participate in the Distribution Reinvestment Plan in relation to the distributions for these quarters. An annual distribution statement containing the actual taxable components for the year ending 30 June 2003 will be forwarded to all Unitholders in August 2003. 4. Earnings per Unit Consolidated 31 Dec 2002 31 Dec 2001 Basic earnings per unit (¢) 5.91 5.97 Diluted earnings per unit (¢) 5.91 5.97 Weighted average number of ordinary units on issue used in the calculation of basic and diluted earnings per unit 830,988,101 678,895,211 Net profit of $49,117,000 (2001: $40,504,000) was used in calculating basic and diluted earnings per unit.

31 4Financial Report

Notes to the Financial Statements (cont.) For the half year ended 31 December 2002

5. Investment Properties Acquisition Costs Capital date including expenditure acquisition since costs acquisition $000 $000 Warehouse/Distribution Centres MFive Industry Park, 20 Dec 01 42,389 26,823 Moorebank, NSW GreystanesPark, Greystanes, NSW – East, Stage 1 14 Dec 01 26,431 4,613 – West, Stage 2 (1) 20,702 121 47,133 4,734 Forrester Distribution Centre, 10 Apr 01 50,128 35 St Marys, NSW Smithfield Distribution Centre, 16 Dec 02 35,310 – Smithfield, NSW Great West Distribution Centre, 26 Oct 00 27,443 5,362 Arndell Park, NSW Southend Distribution Centre, 29 Jun 98 25,600 96 Mascot, NSW Wyndham Distribution Centre, 16 Oct 98 32,378 97 Laverton, Vic Northgate Distribution Centre, Somerton, Vic – Stages 1 and 2 19 Sep 01 2,958 25,139 – Stage 3 19 Dec 01 3,592 65 6,550 25,204 Laverton Distribution Centre, 4 Oct 01 6,657 18,105 Laverton North, Vic Kingston Distribution Centre, 3 Feb 97 21,684 136 32 Braeside, Vic Valuation Latest Capital Book Book date valuation expenditure value value since last 31 Dec 30 Jun valuation 2002 2002 $000 $000 $000 $000

1 Dec 01 39,500 29,712 69,212 58,177

30 Jun 01 24,550 6,494 31,044 27,797 24 Jun 02 19,500 – 20,823 1,966 44,050 6,494 51,867 29,763 31 Dec 02 50,500 – 50,500 50,162

1 Jan 03 34,000 – 35,310 –

31 Dec 02 35,000 – 35,000 32,503

2 Dec 02 33,000 – 33,000 27,915

1 Dec 01 32,580 75 32,655 32,618

30 Jun 02 26,100 1,262 27,362 26,100 1 Dec 01 3,300 357 3,657 4,318 29,400 1,619 31,019 30,418 31 Dec 02 27,250 – 27,250 13,055

1 Dec 01 26,500 18 26,518 26,516 33 4Financial Report

Notes to the Financial Statements (cont.) For the half year ended 31 December 2002

5. Investment Properties (cont.) Acquisition Costs Capital date including expenditure acquisition since costs acquisition $000 $000 Warehouse/Distribution Centres (cont.) Roberts Distribution Centre, 26 Oct 00 21,097 360 Chullora, NSW Fitzgerald Distribution Centre, 26 Oct 00 18,426 3,563 Laverton North, Vic Miller Distribution Centre, 26 Oct 00 18,285 296 Villawood, NSW Berkeley Distribution Centre, 26 Oct 00 10,218 6,548 Berkeley Vale, NSW Auckland Distribution Centre, (1) 17,897 – Manukau City, Auckland, NZ Boundary Distribution Centre, 26 Oct 00 7,310 8,116 Laverton North, Vic Hume Distribution Centre, 26 Oct 00 15,239 109 Chullora, NSW Sheffield Distribution Centre, 26 Oct 00 12,504 – Welshpool, WA Britton Distribution Centre, 3 Jul 97 9,574 30 Smithfield, NSW Sunshine Distribution Centre, 25 Jun 02 9,939 178 Sunshine, Vic Holbeche Distribution Centre, 26 Oct 00 6,013 29 Arndell Park, NSW Angliss Distribution Centre, 6 Dec 02 4,532 309 Laverton North, Vic 34 Valuation Latest Capital Book Book date valuation expenditure value value since last 31 Dec 30 Jun valuation 2002 2002 $000 $000 $000 $000

31 Dec 02 25,000 – 25,000 23,828

31 Dec 01 20,000 154 20,154 20,008

31 Dec 02 20,000 – 20,000 19,163

1 Dec 01 18,100 305 18,405 18,376

1 Jan 03 17,806 – 17,897 –

31 Dec 02 15,500 – 15,500 15,296

1 Dec 01 15,350 100 15,450 15,434

1 Dec 01 12,000 – 12,000 12,000

31 Dec 02 11,400 – 11,400 10,521

4 Mar 02 9,150 967 10,117 9,954

30 Jun 01 6,800 29 6,829 6,829

02 Nov 01 4,150 – 4,841 4,446

35 4Financial Report

Notes to the Financial Statements (cont.) For the half year ended 31 December 2002

5. Investment Properties (cont.) Acquisition Costs Capital date including expenditure acquisition since costs acquisition $000 $000 Warehouse/Distribution Centres (cont.) Bradford Distribution Centre, 26 Oct 00 3,371 10 Cavan, SA Bonds Distribution Centre, 26 Oct 00 3,001 30 Punchbowl, NSW Lytton Distribution Centre, 9 Oct 02 1,796 1,408 Lytton, Qld Burnie Distribution Centre, 26 Oct 00 1,903 – Wivenhoe, Burnie, Tas Industrial Estates Discovery Cove Industrial Estate, Banksmeadow, NSW – Properties 26 Oct 00 55,095 3,152 – Undeveloped Land 27 Jul 01 1,031 6,005 56,126 9,157 The Gate Industry Park, 31 May 02 33,865 13,310 Penrose, Auckland, NZ Mitchell Industrial Estate, 28 Jun 95 25,911 5,098 Alexandria, NSW Portside Industrial Estate, 13 Dec 02 31,330 – Port Melbourne, Vic Burrows Industrial Estate, 28 Jun 95 19,152 480 Alexandria, NSW Biloela Industrial Estate, 28 Jun 95 15,299 231 Villawood, NSW 36 Valuation Latest Capital Book Book date valuation expenditure value value since last 31 Dec 30 Jun valuation 2002 2002 $000 $000 $000 $000

1 Dec 01 3,650 – 3,650 3,650

30 Jun 01 3,500 27 3,527 3,523

10 May 02 1,620 1,584 3,204 1,698

1 Dec 01 1,700 – 1,700 1,700

1 Dec 01 56,800 1,447 58,247 56,800 1 Dec 01 6,900 136 7,036 7,036 63,700 1,583 65,283 63,836 1 Jun 02 30,325 16,850 47,175 30,276

1 Dec 01 37,500 171 37,671 37,639

1 Jan 03 31,000 – 31,330 –

30 Jun 02 27,700 185 27,885 27,700

30 Jun 00 15,900 231 16,131 16,093 37 4Financial Report

Notes to the Financial Statements (cont.) For the half year ended 31 December 2002

5. Investment Properties (cont.) Acquisition Costs Capital date including expenditure acquisition since costs acquisition $000 $000 Industrial Estates (cont.) Erskine Park Industrial Estate, 28 Nov 02 12,148 1,007 Erskine Park, NSW Abbott Industrial Estate, 17 Apr 96 9,728 285 Chester Hill, NSW Chifley Industry Park, 4 Apr 00 6,028 5,663 Moorabbin, Vic(2) Homebush Bay Industrial Estate, 8 Nov 02 11,159 – Homebush Bay, NSW Healey Industrial Estate, 26 Oct 00 6,519 106 Dandenong, Vic Woodpark Industrial Estate, 15 Feb 96 4,731 75 Smithfield, NSW Business Parks Lidcombe Business Park, Lidcombe, NSW – Buildings A to D 26 Sep 97 41,011 25,498 – Building E 14 Mar 02 4,529 – – Buildings F to G 20 Apr 01 17,660 13,312 63,200 38,810 Clayton Business Park, 13 Dec 02 75,195 – Clayton, Vic Acacia Ridge Business Park, Acacia Ridge, Qld – Stage 1 13 Dec 02 38,256 – 38 – Stage 2 13 Dec 02 16,859 – 55,115 – Valuation Latest Capital Book Book date valuation expenditure value value since last 31 Dec 30 Jun valuation 2002 2002 $000 $000 $000 $000

6 Nov 02 11,250 1,905 13,155 –

1 Dec 01 11,800 225 12,025 12,002

30 Jun 02 6,350 5,141 11,491 6,350

11 Sep 02 10,300 – 11,159 –

1 Dec 01 6,230 82 6,312 6,259

30 Jun 01 6,000 60 6,060 6,045

30 Jun 01 63,600 7,216 70,816 68,215 5 Jan 02 4,500 29 4,529 4,529 3 Apr 01 27,000 3,972 30,972 28,874 95,100 11,217 106,317 101,618 1 Jan 03 73,250 – 75,195 –

1 Jan 03 35,000 – 38,256 – 1 Jan 03 16,600 – 16,859 – 39 51,600 – 55,115 – 4Financial Report

Notes to the Financial Statements (cont.) For the half year ended 31 December 2002

5. Investment Properties (cont.) Acquisition Costs Capital date including expenditure acquisition since costs acquisition $000 $000 Business Parks (cont.) Campus Business Park, 29 Jun 01 36,684 17,962 Homebush, NSW Botany Grove Business Park, Botany, NSW – Stage 1 26 Oct 00 14,514 2,214 – Stage 2 26 Oct 00 10,336 5,758 – Stage 3 18 Dec 01 9,348 6,056 34,198 14,028 Airgate Business Park, Mascot, NSW – Stage 1 26 Oct 00 24,822 1,267 – Stage 2 26 Oct 00 9,350 187 34,172 1,454 TransTech Business Park, 18 Oct 96 30,175 2,137 Lane Cove, NSW Talavera Business Park, North Ryde, NSW – Building A 27 Nov 00 14,889 208 – Building B 26 Oct 00 14,540 2,075 29,429 2,283 Enterprise Park, 26 Oct 00 23,091 1,277 Gladesville, NSW Dansu Court Business Park, 26 Oct 00 28,508 376 Hallam, Vic 40 Valuation Latest Capital Book Book date valuation expenditure value value since last 31 Dec 30 Jun valuation 2002 2002 $000 $000 $000 $000

1 Jul 01 45,000 9,646 54,646 52,097

30 Jun 02 16,640 88 16,728 16,640 30 Jun 02 20,360 – 20,360 20,360 30 Jun 02 13,000 2,156 15,156 13,000 50,000 2,244 52,244 50,000

30 Jun 02 29,200 329 29,529 29,200 31 Dec 02 9,000 – 9,000 9,500 38,200 329 38,529 38,700 1 Dec 01 36,700 547 37,247 36,778

30 Jun 02 15,100 9 15,109 15,100 30 Jun 01 16,900 1,379 18,279 17,708 32,000 1,388 33,388 32,808 30 Jun 01 24,700 991 25,691 25,519

31 Dec 02 24,200 – 24,200 28,792

41 4Financial Report

Notes to the Financial Statements (cont.) For the half year ended 31 December 2002

5. Investment Properties (cont.) Acquisition Costs Capital date including expenditure acquisition since costs acquisition $000 $000 Business Parks (cont.) Wedgewood Business Park, 26 Oct 00 22,844 118 Hallam, Vic(3) Waterloo Business Park, 26 Oct 00 15,206 3,956 North Ryde, NSW Seville Business Park, 26 Oct 00 16,945 243 Villawood, NSW Pacific View Business Park, 31 May 96 10,931 298 Frenchs Forest, NSW Orion Business Park, 8 Nov 02 11,709 5 Lane Cove, NSW Queensport Quays Business 9 Oct 02 5,892 196 Park, Murarrie, Qld Office Parks CityWest Office Park, 16 Jun 99 69,474 20,384 Pyrmont, NSW Macquarie Corporate Park, North Ryde, NSW – Building A 15 Mar 02 36,459 13 – Building B 16 Jun 99 40,829 165 77,288 178 Binary Centre, North Ryde, NSW 1 Mar 02 77,423 36 Talavera Corporate Centre, 30 Apr 02 40,250 19,428 North Ryde, NSW 42 Valuation Latest Capital Book Book date valuation expenditure value value since last 31 Dec 30 Jun valuation 2002 2002 $000 $000 $000 $000

31 Dec 02 22,390 – 22,390 24,167

30 Jun 01 19,300 1,646 20,946 19,334

30 Jun 02 17,200 307 17,507 17,200

1 Dec 01 14,100 162 14,262 14,228

11 Sep 02 11,200 – 11,714 –

1 Sep 02 5,500 – 6,088 –

30 Jun 02 100,000 943 100,943 100,000

14 Feb 02 34,000 2,472 36,472 36,418 1 Dec 01 42,500 99 42,599 42,552 76,500 2,571 79,071 78,970 1 Mar 02 77,000 459 77,459 77,451 30 Apr 02 33,000 26,678 59,678 41,876

43 4Financial Report

Notes to the Financial Statements (cont.) For the half year ended 31 December 2002

5. Investment Properties (cont.) Acquisition Costs Capital date including expenditure acquisition since costs acquisition $000 $000 Office Parks (cont.) Central Park Corporate Centre, 31 Oct 02 49,821 476 Greenlane, Auckland, NZ Warringah Corporate Centre, Frenchs Forest, NSW – Stage 1 9 Nov 01 40,158 1,323 – Stage 2 (1) 3,023 84 43,181 1,407 Cambridge Office Park, 16 Jun 99 36,069 1,032 Epping, NSW Hurstville Office Park, 16 Jun 99 22,937 784 Hurstville, NSW The Precinct Corporate Centre, 19 Dec 01 22,338 1,846 North Ryde, NSW Suburban Commercial Buildings Ashfield Corporate Centre, 16 Jun 99 30,110 9,437 Ashfield, NSW Gordon Corporate Centre, 16 Jun 99 19,300 63 Gordon, NSW(2) Investment Properties 1,669,858 275,204

44 Valuation Latest Capital Book Book date valuation expenditure value value since last 31 Dec 30 Jun valuation 2002 2002 $000 $000 $000 $000

24 Sep 02 49,035 – 50,297 –

1 Sep 01 37,000 4,481 41,481 40,801 1 Sep 01 2,900 207 3,107 3,023 39,900 4,688 44,588 43,824 30 Jun 01 37,400 53 37,453 37,436

1 Dec 01 27,000 105 27,105 27,040

1 Dec 01 22,100 2,084 24,184 24,016

31 Dec 02 38,000 – 38,000 35,726

30 Jun 01 22,000 27 22,027 22,027

1,877,936 133,602 2,023,966 1,603,360

45 4Financial Report

Notes to the Financial Statements (cont.) For the half year ended 31 December 2002

5. Investment Properties (cont.)

Note: Homebush Corporate Park, Homebush, NSW is owned by Carter Street Trust of which MGI holds a 50% interest. The shaded properties are held by Macquarie Goodman Capital Trust, a subtrust of MGI.

(1) Contracts have been exchanged with settlement scheduled after 31 December 2002.

(2) All investment properties are held on a freehold basis with the exception of Chifley Industry Park, Moorabbin, Vic and Gordon Corporate Centre, Gordon, NSW where the land is held on a leasehold basis.

(3) A portion of the property costing $1.19 million was sold during the half year ended 31 December 2002.

Consolidated 31 Dec 2002 30 Jun 2002 $000 $000 Carrying amount at the beginning of the period 1,603,360 1,145,845 Additions 416,190 491,565 Disposals (1,191) (61,112) Revaluation increments 5,607 27,062 Carrying amount at the end of the period 2,023,966 1,603,360

6. Contributed Equity Consolidated 31 Dec 2002 30 Jun 2002 $000 $000 949,352,157 (2002: 757,130,197) fully paid ordinary units 1,190,366 921,603 Issue costs (29,389) (25,700) 1,160,977 895,903

46 Notes to the Financial Statements (cont.) For the half year ended 31 December 2002

6. Contributed Equity (cont.) Consolidated 31 Dec 2002 30 Jun 2002 $000 $000 654,511,988 Units on issue at 781,904 30 June 2001 6,885,770 Units issued for Distribution 8,944 Reinvestment Plan(1) (“DRP”) on 6 August 2001 34,728,949 Units issued for placement 47,232 on 30 October 2001 7,801,212 Units issued for DRP 10,535 on 1 November 2001 7,563,439 Units issued for Unitholder 10,286 Purchase Plan(2) on 30 November 2001 32,063,053 Units issued for placement 43,606 on 17 December 2001 7,139,261 Units issued for DRP on 10,003 7 February 2002 6,436,525 Units issued for DRP 9,093 on 2 May 2002 757,130,197 Units on issue at 921,603 921,603 30 June 2002 5,996,549 Units issued for DRP 8,424 on 8 August 2002 84,791,860 Units issued for placement 116,165 on 2 September 2002 6,498,336 Units issued for DRP 9,366 on 1 November 2002 94,935,215 Units issued for placement 134,808 on 13 December 2002 949,352,157 Units on issue 1,190,366 31 December 2002 47 4Financial Report

Notes to the Financial Statements (cont.) For the half year ended 31 December 2002

6. Contributed Equity (cont.)

(1) MGI has established a DRP which has been in operation since the quarter ended 30 June 2000. Under the DRP, holders of ordinary units may elect to have all or part of theirdistribution entitlement satisfied by the issue of new ordinary units rather than being paid in cash. Units are issued under the DRP at a discount to the issue price, at the discretion of the Board. (2) MGI introduced a Unitholder Purchase Plan (“UPP”) in November 2001. The UPP enabled eligible Unitholders to purchase additional units in MGI up to a maximum of $3,000, with no brokerage or transaction costs.

7. Non-cash Financing and Investing Activities During the period 12,494,885 units for a total consideration of $17,790,000 were allocated under MGI’s DRP as payment for distributions (2001: 14,686,982 for a total consideration of $19,479,000).

8. Segment Reporting The Consolidated Entity’s business is investing in industrial and commercial properties in both Australia and New Zealand. New Zealand is not a separately reportable segment.

9. Acquisition of Controlled Entities The following controlled entities were acquired or disposed of during the period: 2002 Name Date Consolidated Consideration Contribution to acquired Entity’s consolidated interest net profit % $000 $000 Orion Road Trust 31 Oct 2002 100 11,031 101 Hill Road Trust 31 Oct 2002 100 10,615 99 Clayton 1 Trust 12 Dec 2002 100 74,462 469 Port Melbourne 1 Trust 12 Dec 2002 100 31,000 164 Smithfield Property Trust 16 Dec 2002 100 34,970 282

2001 48 The Consolidated Entity did not gain control over any entities during the prior corresponding half year. Directors’ Declaration to Unitholders

In the opinion of the directors of Macquarie Goodman Funds Management Limited, the Responsible Entity for Macquarie Goodman Industrial Trust (“MGI”): 1. the financial statements and notes set out on pages 24 to 48, are in accordance with the Corporations Act 2001, including: (a) giving a true and fair view of the financial position of the Consolidated Entity as at 31 December 2002 and of its performance, as represented by the results of its operations and cash flows for the half year ended on that date; and (b) complying with Australian Accounting Standard AASB 1029 “Interim Financial Reporting” and the Corporations Regulations 2001; and 2. there are reasonable grounds to believe that MGI will be able to pay its debts as and when they become due and payable. This declaration is made in accordance with a resolution of the directors.

David Clarke, AO Chairman

Gregory Goodman Director Sydney, 5 February 2003 49 5Independent Review Report

Independent Review Report to Unitholders

Scope We have reviewed the Financial Report of Macquarie Goodman Industrial Trust (“MGI”) for the half year ended 31 December 2002, consisting of the Statement of Financial Performance, Statement of Financial Position, Statement of Cash Flows, accompanying notes 1 to 9 and the Directors’ Declaration. The Financial Report includes the consolidated Financial Statements of the Consolidated Entity comprising MGI and the entities it controlled at the end of the half year or from time to time during the half year. The directors of the Responsible Entity, Macquarie Goodman Funds Management Limited, are responsible for the Financial Report. We have performed an independent review of this Financial Report in order to state whether, on the basis of procedures described, anything has come to our attention that would indicate that the Financial Report is not presented fairly in accordance with Australian Accounting Standard AASB 1029 “Interim Financial Reporting” and other mandatory professional reporting requirements in Australia and statutory requirements so as to present a view which is consistent with our understanding of the Consolidated Entity’s financial position, and performance as represented by the results of its operations and its cash flows and in order for MGI to lodge the Financial Report with the Australian Securities and Investments Commission. Our review has been conducted in accordance with Australian Auditing Standards applicable to review engagements. The review is limited primarily to inquiries of the Responsible Entity and analytical procedures applied to the financial data. Our review has not involved a study and evaluation of internal accounting controls, tests of accounting records or tests of responses to inquiries by obtaining corroborative evidence from inspection, observation or confirmation. The procedures do not provide all the evidence that would be required in an audit, thus the level of assurance is less than given in an audit. We have not performed an audit and, accordingly, we do not express an audit opinion.

50 Independent Review Report to Unitholders (cont.)

Statement Based on our review, which is not an audit, we have not become aware of any matter that makes us believe that the half year Financial Report of MGI is not in accordance with: (a) the Corporations Act 2001, including: (i) giving a true and fair view of the Consolidated Entity’s financial position as at 31 December 2002 and of its performance for the half year ended on that date; and (ii) complying with Australian Accounting Standard AASB 1029 “Interim Financial Reporting” and the Corporations Regulations 2001; and (b) other mandatory professional reporting requirements.

KPMG Scott Fleming Partner Sydney, 5 February 2003

51 6ASX Additional Information

Top 20 Unitholders as at 31 January 2003 Numbers of % of total units held issued units 1. JPMorgan Nominees Australia 111,064,098 11.70 2. RBC Global Services Australia Nominees Pty Limited 91,854,760 9.68 3. Westpac Custodian Nominees Limited 75,169,057 7.92 4. Cogent Nominees Pty Limited 65,463,048 6.90 5. National Nominees Limited 63,014,802 6.64 6. Questor Financial Services Limited 57,244,215 6.03 7. Citicorp Nominees Pty Limited 29,814,782 3.14 8. Bond Street Custodians Limited 28,095,381 2.96 9. AMP Life Limited 25,336,784 2.67 10. Commonwealth Custodial Services Limited 24,564,387 2.59 11. Goodman Holdings Pty Limited 18,312,865 1.93 12. MLC Limited 14,819,290 1.56 13. Westpac Financial Services Limited 12,471,953 1.31 14. HSBC Custody Nominees (Australia) Limited 10,412,278 1.10 15. Transport Accident Commission 10,052,516 1.06 16. ING Life Limited 8,939,477 0.94 17. NRMA Nominees Pty Limited 7,650,866 0.81 18. Permanent Trustee Australia Limited 6,155,198 0.65 19. Victorian Workcover Authority 6,101,831 0.64 20. Invia Custodian Pty Limited 5,962,301 0.63 Units held by top 20 Unitholders 672,499,889 70.86 Balance of units held 276,852,268 29.14 Total issued units 949,352,157 100.00

Unitholder distribution as at 31 January 2003 Number of Number of Unitholders units held 1 – 1,000 714 322,435 1,001 – 5,000 2,623 8,585,040 5,001 – 10,000 3,888 29,756,194 10,001 – 100,000 6,763 151,890,849 100,001 and above 238 758,797,639 Total 14,226 949,352,157 Unitholders with less than a marketable parcel 237 29,819

Voting rights Unitholders are entitled to one vote for each fully paid unit held.

52 On market buy-back There is no current on market buy-back. 7Investor Relations

Providing outstanding customer service and timely communications to our Unitholders is fundamental for Macquarie Goodman Industrial Trust (“MGI”).

Communication We recognise the importance of timely and informative communication with our Unitholders. Our comprehensive website at www.macquariegoodman.com.au/mgi and toll free number on 1300 791 100, enable Unitholders to gain information about MGI and provide feedback about their needs. The website enables Unitholders to view information about their holdings, download all investors forms, check unit prices and trading histories and much more.

Unitholder Purchase Plan (“UPP”) MGI offered a UPP in the first quarter of this year. As a result of industry lobbying over the past year, the Australian Securities and Investments Commission has increased the limit that Unitholders may invest from $3,000 to $5,000 worth of units in a UPP.

Distribution Reinvestment Plan (“DRP”) MGI also offers a DRP which allows Unitholders to use their distributions to “buy” new units in MGI. Investors that participate in the DRP generally receive a 2% discount on the issue price, which is based on the weighted average trading price over the 10 days from the ex-distribution date, and there is no brokerage charged.

Distribution Timetable Record date Ex-distribution date Proposed payment date 31 March 2003 25 March 2003 2 May 2003 30 June 2003 24 June 2003 8 August 2003 30 September 2003 24 September 2003 1 November 2003 31 December 2003 24 December 2003 6 February 2004

Annual Distribution Statements Annual distribution statements confirming the distributions paid and final taxable components for the year ending 30 June 2003 will be forwarded to all Unitholders in August 2003.

53 Other Trusts Managed 8by Macquarie Goodman

Macquarie Goodman Capital Trust (“MGA”)

As at 30 September 2002 MGA is a subtrust of MGI and holds an interest in 30 properties in Australia. The properties are valued at $1.2 billion and include warehouse/distribution centres, business parks, office parks and industrial estates. MGA delivered a successful first half year of trading with a profit of $27.6 million and total assets increasing to $1.2 billion. This result was from the date of listing on 28 May 2002 to 30 September 2002. MGA’s reporting will synchronise with MGI from 30 June 2003 and it will Binary Centre, North Ryde, NSW produce its own annual report from that date. Sector Industrial (Hybrid Securities) Number of Properties 30 Total Assets $1.2 billion RePS Price $102.00 Yield 7.5% per annum ASX Code MGAPA

Ascendas Real Estate Investment Trust (“A-REIT”)(1)

As at 31 December 2002 Ascendas-MGM Funds Management Limited(1) manages A-REIT, Singapore’s first listed industrial property trust. A-REIT listed on the Singapore Exchange on 19 November 2002 with the initial public offering five times subscribed. A-REIT holds a portfolio of eight properties including four science parks, three high-tech/light industrial buildings and one built-to-suit property.

The Capricorn, Singapore Sector Industrial Science Park II, Singapore Number of Properties 8 Total Assets(2) $627 million Unit Price(2) $0.87 Yield 8.1% per annum SGX Code Ascendas REIT

(1) Ascendas-MGM Funds Management Limited is a 60/40 joint venture between Ascendas Land 54 (Singapore) Pte Ltd and Macquarie Goodman Management Limited. (2) Australian dollars. Trusts Managed by Associates 9of Macquarie Goodman

Macquarie CountryWide Trust As at 31 December 2002 Sector Retail Number of Properties 109 Total Assets $1.0 billion Unit Price $1.64 Yield 8.3% per annum ASX Code MCW Macquarie Leisure Trust As at 31 December 2002 Sector Leisure Number of Properties 5 Total Assets $157.0 million Unit Price $0.70 Yield 10.3% per annum ASX Code MLE Macquarie Office Trust As at 31 December 2002 Sector Office Number of Properties 22 Total Assets $1.6 billion Unit Price $1.22 Yield 9.0% per annum ASX Code MOF Macquarie Prologis Trust As at 31 December 2002 Sector Industrial (North America) Number of Properties 54 Share of Total Property Assets $831.8 million Unit Price $0.86 Yield 8.7% ASX Code MPRCA Macquarie Direct Property Macquarie Direct Property currently manages 10 unlisted property trusts, with properties in the commercial, industrial and retail sectors. These trusts show attractive income returns and offer some tax sheltering benefits as well as the opportunity of capital growth. For further information on any of these listed or unlisted property trusts, please contact your stockbroker or financial adviser, Ask Macquarie on 1300 365 585 (local call cost), visit the website www.macquarie.com.au/propertytrusts or email Macquarie at [email protected]. 55 10Glossary of Terms

Term Definition or Explanation A-REIT Ascendas Real Estate Investment Trust ASIC Australian Securities and Investments Commission Asset revaluation reserve Undistributed profits that have arisen on the revaluation of the investment properties held in MGI’s portfolio. These profits will only be realised when the properties are sold. ASX Australian Stock Exchange Limited Capital profits reserve Undistributed profits that have been realised on the sale of the investment properties. DPU Distribution per unit DRP Distribution Reinvestment Plan EPU Earnings per unit Ex-distribution When units are traded after this date, they will not qualify for the forthcoming distribution. Financial Position MGI’s assets and liabilities at a particular date. Macquarie Goodman Macquarie Goodman Funds Management Limited (ABN 48 067 796 641) Managed Investment Scheme A scheme that has the following features: – people contribute money to acquire units to share in the benefits of the scheme; – the contributions are pooled to produce financial benefits for unitholders; and – unitholders do not have the day to day control over the operation of the scheme. In the case of MGI, it is a Registered Managed Investment Scheme with ASIC. Management Expense Ratio Total expenses (excluding borrowing costs) divided by the weighted average of total assets under management. 56 Macquarie Goodman Industrial Trust is Australia’s largest industrial property trust listed on the Australian Stock Exchange. Its objective is to deliver a liquid stock to its Unitholders with secure income returns and potential for long-term capital growth.

Australian currency. February 2003. DESIGNED AND PRODUCED BY IMPRESS DESIGN REPORT FOR THE HALF YEAR ENDED 31 DECEMBER 2002 Macquarie Goodman Industrial Trust ARSN 091 213 839