This article is from the Australian Property Journal archive
SHOPPING centre owner Unibail-Rodamco-Westfield saw tenant sales and rent collection return to pre-COVID levels across its global portfolio of major malls in 2022.
Posting its full-year results, the ASX-listed giant said tenants sales reached 103% of 2019 levels for the year, with its European centre sales matching pre-COVID numbers while its United States centres were running at 108%.
Rent collection was at 97%, in line with 2019.
CEO Jean-Marie Tritant said URW achieved “excellent financial results in 2022, confirming the end of any COVID effect on our business”.
“In particular, tenant sales and rent collection returned to pre-pandemic levels and we delivered consistent improvement in operating metrics across all regions. Our proactive leasing strategy yielded a higher proportion of longer-term leases at increased rents while we also benefitted from sales-based rents and the positive impact of indexation.”
Like-for-like net rental income lifted 27.4% to €2.226 billion, with a 21.5% increase across its shopping centres and a strong rebound in convention and exhibition activity.
The shopping centre rental income was underpinned by a 25.4% jump in Continental Europe, helped by the end of COVID rent discounts and indexation, with 21.4% growth in the United Kingdom and 12.0% growth in the United States.
Vacancy across the shopping centres have fallen from 8.9% at the halfway mark of 2021 and 7.0% at the end of calendar 2021 to now sit ta 6.5%. In Continental Europe, vacancy was 3.1%, down from 4.0% a year earlier and 5.0% 18 months earlier. UK vacancies have steadily come down from 12.2% in June of 2021 to 9.4%, while in the US, vacancy is at 10.4% having sat at 14.0% in June 2021 and 11.0% at the end of 2021.
EBITDA jumped 30.2% to €2.2 billion, and adjusted recurring earnings per security was up 34.7% to €9.31. Unibail-Rodamco-Westfield is expecting 2023 earnings to be in the range of €9.30 to €9.50.
Gross market value of the group’s assets decreased by 4.1% to €52.2 billion, mainly as a result of €1.8 billion of disposals and a downwards like-for-like portfolio revaluation of €1.3 billion, or 2.7%. The like-for-like shopping centres valuation was negative 2.6%
“In 2023, we will perform as retailers and brands optimise their store networks with us, with a focus on the most productive stores in prime locations as part of their drive-to-store strategies.
Tritant said strong growth in commercial partnerships revenues demonstrated the opportunity to generate new revenues from qualifying the audience of visitors to our centres, especially in Europe where it launched Westfield Rise, an in-house media advertising agency.
The group has managed a €1.9 billion debt reduction thanks to disposals in the United States and Europe, translated into enhanced credit metrics.
Tritant said the group is on track to deliver its “2024 and beyond” strategy, which includes “maximising asset value through the disciplined delivery of our committed pipeline and unlocking new development opportunities, with a focus on urban regeneration and environmental transition projects”.
In 2022, the Group delivered the 19,439 sqm Westfield Topanga extension, “Rue de la Boucle”, a 10,000 sqm destination at Westfield Forum des Halles, the Gaîté Montparnasse office project as well as the 33,364 sqm Les Ateliers Gaîté shopping centre to complete the Gaîté Montparnasse mixed-use urban regeneration project in Paris. The average letting of these deliveries was at 88%.
Committed projects amount to €2.4 billion, of which €1.2 billion has already been invested. The two main projects are the mixed-used Westfield Hamburg-Überseequartier in Hamburg and the residential project of Coppermaker Square in London.
