Scentre Group, the giant Real Estate Investment Trust which owns and manages the Westfield Shopping Centres in Australia and New Zealand, is on track to deliver its forecast increase in earnings and distribution for the full year.
The company’s third quarter update, released Thursday, confirmed funds from operations (FFO) for the year to December 31 would be 23.25 cents per security and the distribution of would be 21.3 cents per security.
The key measure of the strength of retailing in the malls, the Moving Annual Turnover in the specialty stores rose 3.4 per cent.
At the half year the figure was four per cent, which points to a slowing in sales growth consistent with reports from other major shopping centre managers.
Turnover went backwards over nine months in the supermarkets, discount department stores, cinemas and in the homeware specialty stores.
Sales also fell in Perth malls.
Scentre forecast operating income would rise 2.7-3.0 per cent in the year to December 31.
For investors, the September quarter was muted after the strong first half, with total return falling 2.4 per cent.
The decline, driven by the a move out of yield stocks, has accelerated since the end of the quarter with Scentre securities losing nine per cent of value since September 30.
Two major projects, at Westfield Warringah Mall and Westfield North Lakes, will open on November 17.
The $310 million redevelopment at Westfield Warringah Mall will house the first ‘new look’ Myer department store, as well as the only Sephora and H&M stores on Sydney’s lower north shore. All up the work will add 70 new stores, a resort-style refurbished centre court, a bespoke kids’ play area and valet parking in work that will take the size of the centre to 133,000 sqaure-metres.
The $170 million redevelopment at Westfield North Lakes will include a new IKEA, a new 60-store gallery mall anchored by major retailers Kmart, JB HiFi Home and Rebel Sport and take the total size of the centre to 113,000sqm.
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