Westfield flags offshore move
Frank Lowy’s Westfield Corporation intends to take another step in cutting ties with Australia by shifting its head office overseas, once an offshore stock market listing is finalised.
The company is entirely focused on shopping malls in the United States, Britain and Europe, with all Westfield-branded centres in Australia and New Zealand having been spun off into a separate entity known as Scentre Group.
Westfield Corp chairman, billionaire Frank Lowy, indicated on Thursday the company would move its Sydney head office overseas.
He said the exact location of the new headquarters would depend on where Westfield Corp was listed overseas, a decision that’s due in the next 12 months.
“We have made it clear at the time of the restructure that … we are intending to get listing elsewhere and the details have not been fully worked out, it’s a very complex issue,” Mr Lowy told the company’s annual general meeting.
“There will be no solution, until there is listing, as to where head office and administration will be.”
Offshoring the company’s head office will further reduce Westfield’s 55-year corporate links with Australia.
Westfield also today released a quarterly update that showed specialty retail sales at its flagship stores surged in the three months to March.
Total speciality retail sales grew by 5.7 per cent through the 12 months to March 31.
Sales rose fastest at flagship stores, where speciality retail sales lifted 6.3 per cent over the year, after surging 11 per cent in the most recent quarter.
In its regional stores, Westfield’s speciality retail sales increased by 4.2 per cent over the year, with a 6 per cent lift in the March quarter.
The company has outlined plans for an $US11.4bn program to upgrade and create new shopping centres.
Westfield said it had developments worth $US2.4 billion under construction, with an estimated yield range between 6.5 and 7.5 per cent.
It also has a $US9bn future development program, of which its share is $US4.5bn, with an estimated yield of 7 to 8 per cent.
Frank Lowy said the company was focused on rolling out flagship properties in Europe and the US, including the $US1.4 billion Westfield World Trade Centre in New York. The group took ownership of the retail component of the Twin Towers just weeks before the September 11 attacks.
Co-chief executive Steven Lowy said Westfield was benefiting from the convergence of physical and digital retail.
“We formed the view that the simple predictions that the growth of online retail would be at the expense of physical retail would prove to be exaggerated,” he said. “As online sales have increased, so have the sales in our malls.”
Westfield owns and manages a portfolio of 40 shopping centres in the US and the UK. The centres are valued at more than $US28bn and are home to 7,400 retailers generating $US17bn in annual retail sales, Frank Lowy said.
Westfield shares had increased by 1.63 per cent to $9.35 by 3.25pm (AEST) against a benchmark index fall of 0.5 per cent.
Australian and New Zealand Westfield shopping centres are now owned by Scentre Group, following a restructure in 2014 after the global financial crisis.