Scentre Group, operator of the Westfield malls in Australia & New Zealand, has begun the process of selling the 4 New Zealand shopping centres it hadn’t already sold 49% of.
Scentre sold 49% of the other 5 centres – Albany, Manukau, Newmarket, Riccarton & St Lukes – to Singapore’s sovereign wealth fund, GIC, in November. That sale’s due to settle by the end of March, giving Scentre proceeds of $1.036 billion.
The 4 now going on the market are Glenfield & WestCity in Auckland, Chartwell in Hamilton and Queensgate in Lower Hutt.
Scentre was created last year from the restructure of Westfield Retail Trust & Westfield Group. Scentre Group took the Australian & New Zealand business and Westfield Corp took the international business outside Australian & New Zealand.
One big change from the trust to Scentre is that Scentre is internally managed. A second is that Scentre is no longer a pure landlord acquiring assets – once developed – from its manager, Westfield Group. If it’s to develop new stock, it will have to undertake that itself.
Apart from the cursory mention of a sales process which Scentre said it had already announced, the New Zealand malls didn’t feature strongly in the group’s annual results announcement.
The $2 billion New Zealand portfolio lifted specialty store sales by 2.3% to $8765/m² in 2014 ($8542) after 0.1% & 0.4% rises in the previous 2 years. Specialty store rental growth also picked up from rises of 0.6% & 0.4% in the previous 2 years, rising by 1% in 2014 to $1139/m² ($1128).
By comparison, the Australian portfolio’s performance was much stronger. Australian sales rose 3.6% and rent 2.4% last year.
A number of the financial report lines were incomparable because of the differences between the 2013 & 2014 entities, such as the increase in net profit after tax from $A1.6 billion to $A6.6 billion.
However, earnings/share seemed comparable, and showed a decline. Basic earnings/share were reported as A5.19c/share for 2014 (A7.01c in 2013) and diluted earnings A5.17c (A6.97c). Gearing at 31 December 2014 was 34.9%.
The group owns interests in 47 Westfield centres and has assets under management of $A41 billion.
Attribution: Company release.