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UPDATED: Scentre Group says business as usual for NZ shopping malls on the block

UPDATED: "It remains very much business as usual for the centres"

Fiona Rotherham
Tue, 24 Feb 2015

UPDATEDScentre Group, the Australasian shopping centre owner, said it had placed its four remaining 100 percent-owned shopping centres in New Zealand on the market for expressions of interest. 

However there is no sale agreement in place at this stage for the four malls, WestCity and Glenfield in Auckland, Chartwell in Hamilton, and Queensgate in Lower Hutt, the company said in an emailed statement. 

"It remains very much business as usual for the centres," it said. 

The move follows its $2.1 billion deal, announced in November, to sell 49 per cent sale of its other five Westfield malls to the Singaporean Government Investment Corporation. The GIC deal involved four Auckland malls; Albany, Newmarket and St Lukes, which have all been earmarked for development, and Manukau, plus Riccarton in Christchurch. 

The ASX-listed Scentre Group today posted a net profit of A$1.3 billion for the six months ended Dec.31, which included revaluations of A$648.9 million, and in a statement the company signalled improved retail trading conditions. 

The group, which operates 47 malls in Australia and New Zealand and has A$40.9 billion worth of assets under management, was set up at the end of June 2014 following the merger of the Australian and New Zealand operations of Westfield Group with the Westfield Retail Trust and comparisons, therefore, can't be made with the previous year. 

The group has been singled out in a video released by Islamic terrorist group, Al-Shebab, urging its supporters to attack Westfield malls around the world. The group murdered around 63 people in a September 2013 attack in a Westgate mall in Nairobi, Kenya. Westfield management said there was no evidence of an imminent threat to its shop but will take steps to keep them safe. 

Funds from Operations (FFO), the preferred measure for the retail property industry, was A$578 million, which represents 10.88 Australian cents per security, in line with guidance. The forecast for the 2015 full-year indicated expected improved FFO growth of 3.5 percent. 

Distribution per security was 10.2 Australian cents, also in line with the 2014 financial year forecasts, and it is forecasting increased distribution of 20.9 Australian cents per security this financial year. 

Chairman Frank Lowy said he was pleased with the success of the merger and with the full-year operational results, in particularly with comparable specialty store sales in Australia which were up 3.6 percent, both for the quarter and the 12 months. New Zealand speciality sales were up 2.3 percent. 

"We believe the portfolio will generate strong long term growth and risk adjusted returns," Lowy said. 

As at the end of December, comparable net operating income across Australia and New Zealand increased 2.2 percent. 

(BusinessDesk)

Fiona Rotherham
Tue, 24 Feb 2015
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UPDATED: Scentre Group says business as usual for NZ shopping malls on the block
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