Scentre plunges to $3.6b loss as pandemic sinks value of malls
Australia’s largest shopping mall owner Scentre Group has sunk to a $3.6 billion loss as the coronavirus pandemic wiped away the value of its properties.
The retail landlord is the latest to feel the scourge of the pandemic, with the steep decline in Westfield’s malls leading the group to report a statutory loss of $3.613 billion for the six months to June.
More than 93 per cent of retail stores are open across Westfield's portfolio excluding its Victorian centres.Credit:Brook Mitchell
The loss was exacerbated by a slump in revenue from tenants unable to pay rent.
Scentre said it had made provisions for the financial impact of the pandemic with a credit charge of $232 million for the half-year period.
It reported an unrealised non-cash reduction of $4 billion in the value of its vast Westfield shopping centre portfolio.
The result mirrors its rival Vicinity Centres, the country's second largest shopping centre landlord, which saw $1.79 billion wiped off the value of its extensive portfolio from COVID-19.
At its peak, the pandemic gutted foot traffic in major shopping centres across the country, forcing multiple shops to close and putting significant pressure on rental income from tenants.
“We acknowledge that this has been a difficult time for our customers and our retail partners,” Scentre’s chief executive Peter Allen said.
As customers return to Westfield’s centres in states where harsh social distancing restrictions are being relaxed, more than 93 per cent of retail stores were open across the portfolio excluding its Victorian centres.
The portfolio’s occupancy was 98.8 per cent at the end of June 2020.
The mall owner and manager reported funds from operations - a key industry measure of profitability - of $362 million or 6.96¢ per security.
More to come
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