Hi John,
As you say, SOL has agreed to sell Brickworks’ industrial property joint ventures to Goodman Group (ASX: GMG) for $1.89 billion, cashing in on one of Australia’s most successful long-term property investments. The assets being sold include Brickworks’ 50% interests in a number of industrial property partnerships operated alongside Goodman. The transaction values the assets broadly in line with independent valuations used during the SOL–Brickworks merger completed in late 2025.
- Importantly, the sale excludes the Brickworks Manufacturing Trust, with SOL retaining its 50.1% stake and ownership exposure to the industrial land supporting its manufacturing operations.
Management has positioned the transaction as a “capital recycling” exercise, with proceeds to be redeployed across both domestic and international investment opportunities – without providing specifics. We suspect the funds will be used to increase their exposure overseas, which seems sensible given the policy shambles here in Australia. Around 18% of their portfolio is held in overseas investments and Todd Barlow flagged increasing this at their last update. They’ll also increase private credit investments while management said it wanted more liquidity to “strike” when the next opportunity appears. The Goodman proceeds materially increase that firepower, and we can only assume the plan is to invest in assets that will pay better returns.
- The deal is expected to complete in late June and does not require shareholder approval.
We think the sale price appears fair, reflecting recently assessed asset values, though the key question for shareholders is what comes next. The Brickworks/Goodman partnership has been an outstanding example of patient value creation, transforming low-cost legacy clay mining land on the outskirts of Sydney and Brisbane into a portfolio of premium logistics assets that generated growing, inflation-linked earnings with minimal incremental capital requirements.
By selling the portfolio, SOL is effectively exchanging a proven compounding asset for financial flexibility, increasing the importance of future capital allocation decisions. However, SOL has a great track record of making sound decisions and we see no reason not to back this strategic decision – the market agreed on the day with SOL up more than +1% in a soft session.
