Covid-19 Delta outbreak: NZ’s biggest mall owner Scentre Group sets Australia-NZ rent income record despite pandemic

Just as Auckland’s malls prepare to reopen tomorrow, New Zealand’s biggest shopping centre owner has revealed record rent, despite the pandemic and lockdowns on both sides of the Tasman.

Scentre Group, which half-owns five Westfield-branded malls, has taken more rent in the last few months than it has ever done so previously.

The ASX-listed business said: “The group has collected A$1.8 billion in gross rent for the 10-month period to October 31, 2021, an increase of A$607m since June 30, 2021.”

During the nine months to September 30, 2021, the group completed 2010 lease deals, including 868 new merchants, welcoming 191 new brands to its portfolio.

Scentre half-owns Westfields at Albany, St Lukes, Newmarket, Manukau and Riccarton.

Scentre has said today it had been preparing for luxury shops to open in Newmarket tomorrow.

Balenciaga, Burberry, Michael Kors and Moncler are joining new retailers Mulberry and Saint Laurent boutiques which opened at Westfield Newmarket earlier this year.

Paul Gardner, Scentre’s manager here, said the return to more physical retail experiences was well-timed for the luxury brands.

“We’re certainly seeing a strong sense of anticipation and demand from customers to return to physical retail experiences and from tomorrow, this will include the opportunity to visit four new luxury brands at Westfield Newmarket.

“For Burberry and Balenciaga, this will be the first time connecting with New Zealand customers, here on our shores.

“The appetite from international luxury brands to come to New Zealand and take up space within Westfield Newmarket has been pleasing to see,” Gardner said.

“It is testament to the strength of the local retail market, withstanding the impacts of the pandemic, as well as the world-class retail and lifestyle experience we offer to customers and businesses at our flagship living centre.

“We expect this will only gain momentum as further restrictions lift, borders reopen and we welcome visitors from overseas,” he said.

Coach and Gucci will also open in Newmarket.

Scentre said its portfolio occupancy in both countries was strong at 98.5 per cent at the end of September.

Peter Allen, chief executive, said: “All Westfield living centres have remained open during the period, operating with Covid safe protocols. Our Queensland, West Australia and South Australia centres continued to trade well during this quarter, consistent with the first half of the year.

“Customers are again rapidly returning to our Westfield living centres in New South Wales, Victoria and the Australian Capital Territory now that restrictions have eased. We are also looking forward to welcoming back more businesses and customers to our Auckland centres from tomorrow,” Allen said.

“Over 95 per cent of stores in our Australian portfolio are open and trading, with more stores to reopen over the coming weeks.

“The resilience of our platform together with the actions we have taken throughout the pandemic has seen our business perform well, isolating the impact of these restrictions to the lockdown periods,” he said.

Gross rent collections for the 10-month period to October 31 are A$187m more than the same period in 2020, even though there have been extensive lockdowns during this period, Allen said.

“During the period, we launched Westfield Direct, our aggregated click and collect service as an extension of our in-centre experience. Through Westfield Direct, our business partners can leverage their store networks to increase productivity and reduce the cost of fulfilment.”

The company has started the Westfield Knox redevelopment in Australia.

“During the September quarter, we completed our employee survey and are pleased to report a very high engagement score of 85 per cent, demonstrating the alignment of our team with our strategy and ambition.

“Following the significant easing of restrictions and strong operating conditions, the Group is returning to the original distribution guidance provided in February 2021.”

Subject to no material change in conditions, the group expects to distribute at least A14 cents per share for the 2021 year.

Scentre owns and operates 42 Westfield living centres in Australia and New Zealand, encompassing more than 12,000 shops and outlets.

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