'Open your store': Westfield's plea to its retailers
Westfield Marion covers nearly 137,000 square metres.

'Open your store': Westfield's plea to its retailers

Australia’s largest retail landlord, Westfield operator Scentre, has urged its tenants to keep their stores open as government assistance packages help cover their costs.

Only 39 per cent of Scentre’s 3600 retailers have continued trading, even though the landlord estimates 86 per cent of the stores across its portfolio of malls could remain open within current government restrictions.

A number of traders had closed before the JobKeeper program was announced by the federal government, along with a leasing code unveiled this week through which rent relief can be offered to small and medium-sized businesses.

“There have only been a certain number that have been asked to close,” Scentre chief executive Peter Allen said.

“Those which haven’t been asked to close: the government is basically saying that all jobs are essential. You’re a retailer and you’ve got most of your wages being paid with JobKeeper.

“You know that we are going to be working with you in terms of cash flow support. Then to me it’s a no-brainer that you open your store and see what other revenue you can bring in.”

Mr Allen acknowledged there were “confusing” messages from government on shopping, given restrictions on movement have been declared along with the assertion that all jobs are essential.

This week the federal government set out a rent relief process through which landlords such as Scentre waive or defer rent for their cash-strapped tenants in proportion with reduced sales revenue as tough social distancing rules cut foot traffic in malls.

The process captures smaller retail houses with turnovers of less than $50 million, while the big players are not included in the code. Major operators such as Solomon Lew’s Premier Investments – which runs Portmans, Just Jeans, Smiggle and other chains – have already said they will shut their shops and stop paying rent completely.

Scentre has opened discussions with about two-thirds of its retailers, and Mr Allen said commercial arrangements will be negotiated to help retailers through the crisis.

But he also had a strong word for those big players that have unilaterally announced a rent strike.

“One of the clear messages that the PM said [on Tuesday] is that the retailers have to honour their leases. Part of that is paying rent. Part of that is opening the store. Part of that is meeting the conditions of your leases,” he said.

“We have to focus on cash flow. It’s not just the retailers’ cash flow. It’s also our cash flow. Money goes around.”

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