Under the new regime, restaurants and cafes will be restricted to takeaway and home delivery.
The national cabinet agreed that shopping centres, such as those managed by major ASX-listed operators Scentre, which runs the Westfield chain, and Vicinity, which co-owns the country’s second largest mall Chadstone, be allowed to keep trading.
“We have a critical message for all Australians: shopping centres are open and will continue to provide the essential goods and services the community relies on, especially in these very difficult times,” Shopping Centre Council executive director Angus Nardi said.
Nevertheless the major landlords have been quietly working on contingency plans to manage broader closures if deemed necessary by government. The current measures were described by the Prime Minister as “stage one” restrictions on social gatherings.
Scentre and Vicinity have removed loose seating in their food courts and closed children’s play areas. Signage and guidance have been put up to ensure physical distancing during ordering and pick up in the food courts.
Landlords have also been under pressure to provide rent relief to their specialty tenants, many of whom were already struggling against the rise of e-commerce and a cyclical decline in consumer sentiment. The rapid spread of COVID-19 and the enforcement of social distancing rules has further reduced foot traffic through malls.
The Prime Minister has urged commercial landlords to be willing to make sacrifices to accommodate tenants facing hardship.
“We are committed to playing our role in helping our retailers to get to the other side,” Scentre chief executive Peter Allen said on the weekend. “This includes both financial and non-financial measures.”
Along with other major property players Scentre and Vicinity have withdrawn their guidance for earnings and distributions.
JPMorgan analysts have forecast that earnings at the two mall giants could drop between 25 per cent and 40 per cent as they adjust to strictures on social gathering.
Already some of the world’s biggest mall owners, Unibail-Rodamco-Westfield in Europe and the Simon Property Group in the US, have shuttered large sections of their portfolios.
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