Scentre gearing for retail revival

SCENTRE Group, the owner of the Westfield shopping centres, says it has a number of strategic initiatives under way that will drive its customer strategy coming out of COVID-19.

Chief executive Peter Allen said a key lesson from last year was that Westfield must keep innovating to deliver the most efficient platform for businesses to connect with customers, regardless of the economic cycle.

Mr Allen told the group’s AGM last week that the average dwell time of more than 1½ hours demonstrated that Westfield Living Centres were a “third place” for customers after their home and workplace.

“It also reflects the currency of our customer strategy and our plan to create the places more people choose to come, more often, for longer,” he said.

Mr Allen said supporting retail partners was a key focus during the year, particularly SMEs that bore the brunt of the cashflow shock.

“We reached commercial arrangements with 3398 retail partners, including 2456 SME retailers, in line with the code of conduct,” he said.

“Throughout the year, we saw continued demand for space by our retail partners, with occupancy at 98.5 per cent.

“Notably, the structure of our leases has not changed and remains based on the mutual agreement to pay a fixed base rent, a position fully supported by our debt and equity investors who do not want to see us take on retailer risk.”

Shareholders, though, were not happy with the group’s pay practices, with investors giving the board a “first strike”

Scentre was slugged the strike as 51 per cent of proxies voted against the non-binding resolution, reflecting widespread dissatisfaction with how it has structured payments to top executives.

A second “strike” next year could trigger a board spill.