Why Is Scentre Group Seeing a Surge in Westfield Visits and Sales?
Scentre Group reports a solid operating update for 2025, highlighting increased customer visits, rising business partner sales, and near-full occupancy across its Westfield centres.
- Customer visitation up 3.1% to 453 million
- Business partner sales reach $29.5 billion, up $760 million
- Portfolio occupancy at 99.8%, highest in recent years
- Significant redevelopment projects completed at Westfield Burwood and Southland
- Issued $1 billion Australian and €500 million European senior notes
Strong Foot Traffic and Sales Growth
Scentre Group, the owner and operator of 42 Westfield shopping destinations across Australia and New Zealand, has delivered a robust operating update for 2025. Customer visitation climbed 3.1% to 453 million visits over 45 weeks, reflecting sustained consumer engagement despite ongoing retail sector challenges. Business partner sales across the portfolio hit a record $29.5 billion for the year to September, marking a $760 million increase over the prior year.
Leasing and Occupancy at Peak Levels
Demand for retail space remains exceptionally strong, with portfolio occupancy rising 40 basis points to an impressive 99.8%. The group completed 2,366 leasing deals, achieving specialty rent escalations averaging 4.4% and releasing spreads of +3.0%. This leasing momentum underscores the attractiveness of Westfield centres to a diverse range of retailers and service providers.
Strategic Redevelopments and Member Growth
Significant capital investment continues to reshape key centres. The final stage of the $48 million redevelopment at Westfield Burwood introduced major brands including ALDI, JB Hi-Fi, Nike, and Rebel. Earlier in the year, the $72 million upgrade at Westfield Southland expanded family, dining, and entertainment offerings, with the upgraded David Jones store set to open imminently. Westfield Bondi also unveiled a pioneering health and wellness precinct featuring a Virgin Active social wellness club and Rebel rCX concept store. These enhancements have driven increased visitation and sales uplift across multiple locations.
The Westfield membership program has grown to over 4.8 million members, up 600,000 from last year, reflecting successful efforts to deepen customer engagement through unique offers and experiences.
Capital Management and Outlook
On the financial front, Scentre Group has actively diversified its capital base, issuing $1 billion of 10-year senior notes domestically at a 1.38% margin and returning to the European debt market with €500 million of 8-year senior notes at a 1.295% margin. These moves strengthen the Group’s financial flexibility amid ongoing investment in its portfolio.
Looking ahead, the Group reaffirmed its 2025 funds from operations (FFO) target of 22.75 cents per security, representing 4.3% growth, alongside expected distribution growth of 3.0% to 17.72 cents per security. This guidance signals confidence in the resilience and growth potential of its retail property assets.
Bottom Line?
Scentre Group’s strong operational momentum and strategic investments position it well for continued growth, but investors will watch closely for how evolving retail trends impact future performance.
Questions in the middle?
- How will rising specialty rents affect tenant retention and consumer prices?
- What impact will the new health and wellness precincts have on long-term visitation?
- How might macroeconomic factors influence the Group’s ability to sustain distribution growth?
