Healthy results spawn more global malls

Westfield Corporation has reported a profit of $US2.3 billion ($3.2 billion) for its first full year since it was spun off Westfield’s Australian and New Zealand centres in 2014.

Westfield, now one of the most high-profile Australian companies in the United States, was born from the split of the local and international arms of the business.

The Australian-focused sister business, Scentre Group chaired by elder statesman Frank Lowy, last week also beat market expectations with a healthy full-year result.

The 2015 Westfield result was boosted by property revaluations of $US632 million and a 6.4% rise in speciality store sales to $US726 per square foot.

The group said its funds from operations came in at $US783 million, meeting its own forecasts, and flagged growth of between 3% and 4% in 2016.

Frank Lowy’s sons Peter and Stephen, who run Westfield as co-chief executives, were paid total remuneration in excess of $9 million each for the year while chief operating officer Michael Gutman​ was awarded a retention bonus of $US8.2 million for staying on with the company, receiving total remuneration of $US13.8 million.

Peter Lowy said the retail giant was making significant progress with its $US10.5 billion development program, having started $US2.5 billion of works at its Century City mall in Los Angeles, UTC in San Diego and Westfield London project.

The group flagged two new deals for its flagship World Trade Centre development in New York, which will open in August.

It has signed global car maker Ford to establish a new concept space called “Ford Hub” and created sponsorship-promotion deals with Ford and banking giant JP Morgan Chase to advertise and use event space in the centre.

Stephen Lowy said the group was chasing new income streams from all of its centres.

“We are in the process of executing a whole range of long-term agreements with major brands around categories … to interact with consumers. In addition to taking the stores, those two brands are also taking a specific percentage of our media and events space,” he said.

The World Trade Centre will have in excess of 300,000 people a day going through it, providing opportunities for sponsorship similar to sport events in stadiums, he said.

Stephen Lowy said the split had been “fantastic” for both companies with Westfield shares producing a 43 per cent return.

Average rents were up 2.9% to $US86.59 per square foot across the group and sales growth was broad-based across all categories.


For the year, the retail landlord reported funds from operations (FFO) of $US783 million, or US37.7¢ a security in line with forecasts. It will pay a final distribution of US25.1¢ a security.