RetailTaryn ParisWed 26 Aug 26
Scentre Group Grows 4.4pc, Offloads Mt Gravatt Stake for $882.5m
Scentre Group has lifted first-half funds from operations by 4.4 per cent to $612 million and upgraded full-year guidance, as the Westfield owner locks in an $882.5 million part-sale of its Brisbane flagship shopping centre to Australian Retirement Trust.
The ASX-listed landlord posted distributions of $481 million, up 4.9 per cent, for the six months to June 30, statutory profit of $975 million lifted by a $478 million unrealised property revaluation.
The portfolio was valued at $33.7 billion at the end of June.
Full-year FFO guidance has been upgraded to at least 23.79 cents per security, representing growth of at least 4.25 per cent, while distribution guidance has been lifted to 18.473 cents per security for the year.
Chief executive Elliott Rusanow said the group’s 42 Westfield destinations had attracted 552 million visits over the past 12 months, a record for the business, with business partner sales climbing to $30.3 billion.
Occupancy was at 99.8 per cent, its highest level in more than a decade, while the group completed 1401 leasing deals at average releasing spreads of 3.7 per cent.
ART buys into Mt Gravatt
In a separate announcement, Scentre confirmed Australian Retirement Trust will acquire a 50 per cent interest in Westfield Mt Gravatt for $882.5 million, comprising $870 million for the direct property interest at a 5.50 per cent capitalisation rate and $12.5 million for an adjacent land parcel—a 3.5 per cent premium to December 2025 book values.
Scentre will retain the remaining 50 per cent stake and continue as property, leasing and development manager. The deal is subject to ACCC clearance.
Rusanow said the centre, visited by more than 17 million customers last year, generated more than $1 billion in sales, and that it extends a strategic partnership that has now brought in roughly $3.1 billion of third-party capital through asset joint ventures over the past 13 months.
It follows ART’s earlier $864 million acquisition of a 19.9 per cent interest in Westfield Sydney at a 4.69 per cent capitalisation rate.
Land bank swells to 25,600 homes
Scentre’s residential pipeline across its 670ha landholding has grown from 20,200 to 25,600 units approved or in advanced planning as at June 30.
That includes concept work at Warringah Mall (up to 1600 apartments), Eastgardens (1300), a Brisbane City Council master plan at Chermside (4000) and a newly approved master planning process at West Lakes in Adelaide (up to 2000).
Moody’s Mariano Ferreyra described the half as credit positive, pointing to like-for-like earnings growth, robust occupancy, positive leasing spreads and rent escalations.
Ferreyra said the Mt Gravatt sale, struck at a premium to book value, underscored continued investor appetite for prime regional malls and added to Scentre’s financial flexibility, with the balance sheet also supported by property revaluations, capital recycling and $3.5 billion of liquidity.
