Westfield Trust lifts profits and distrbution for year to 31 December 1998

02 February 1999

Countries: Australia

Consistently Strong Performance Lifts Westfield Trust Profit and Distribution

Westfield Trust today announced a distribution to unitholders of $263.5 million for the year to 31 December 1998, up 9.4% on the previous year. This represents 20.58 cents per unit – up 2.8% over last year’s 20.02 cents, with 36% of the distribution tax advantaged.

The 1998 second half distribution per unit was up 3.1% on the 1997 second half and, barring unforeseen circumstances, the full-year distribution for 1999 is expected to grow at a similar rate.

This is the second consecutive year in which Westfield Trust has recorded 30%+ returns to unitholders and continues the consistently strong returns over the medium and long term, both in absolute terms and compared with the Property Trust Index and All Ordinaries Index.

Westfield Managing Director Steven Lowy said the Directors were pleased the results for the year were above expectations.

Retailers’ sales figures across the Westfield Trust shopping centre portfolio were $6.4 billion for the year to 31 December 1998, up 4.9% or 2.8% on a comparable basis. Specialty store retailers’ sales were up 3.3% on a comparable basis.

Demand by retailers for space in Westfield centres saw the occupancy level continue to exceed 99% of retail space. In addition, all new project work that opened in the year was fully leased.

Compound annual rates of return (%pa)
as at 31 December 1998

1 Year

3 Years

5 Years

10 Years






Property Trust Index





All Ordinaries





Calculated by the Australian Stock Exchange, inclusive of income & capital growth

Highlights for the year include:

Acquisition of 46.6% share in the St Lukes Group, New Zealand’s largest shopping centre owner with ten shopping centres across four cities, for $276 million.

Completion of five redevelopment projects on time and fully leased:

  • Tea Tree Plaza Shoppingtown (Adelaide), $50 million project in joint venture with AMP
  • Airport West Shoppingtown (Melbourne), (Stage One completed) $60 million project
  • Indooroopilly Shoppingtown (Brisbane), $35 million project in joint venture with Commonwealth Funds Management
  • Strathpine Shoppingtown (Brisbane), $40 million project
  • Belconnen Shoppingtown (Canberra), $15 million project in joint venture with Commonwealth Funds Management

Commencement of four major redevelopments

  • Southland Shoppingtown (Melbourne), $285 million in joint venture with AMP
  • Chatswood Shoppingtown (Sydney), $185 million
  • Carousel Shoppingtown (Perth), $190 million
  • Chermside Shoppingtown (Brisbane), $190 million

Extensive planning for four major redevelopments

  • Burwood Shoppingtown (Sydney) – $285 million redevelopment began January 1999
  • Bondi Junction Plaza Shoppingtown (Sydney)
  • Hornsby/Northgate (Sydney)
  • Fountaingate Shoppingtown (Melbourne)

Acquisition of Bondi Carousel shopping centre (Sydney) for $32.4 million in joint venture with AMP.

Total assets for Westfield Trust increased during 1998 to $5.4 billion, up 25% on the previous year.

Unitholders’ equity at December 1998 stood at $3.8 billion, up 23% on the previous year.

Net asset backing of the Trust increased from $2.49 at December 1997 to $2.57 at December 1998, up 3.2%.

“The results show that the centres continue to provide a vibrant business environment for retailers and a convenient retail and entertainment destination for shoppers,” Mr Lowy said.

“We have been able to deliver this over many years because of the ongoing work to improve the portfolio.

“In the past few years we have committed more than $1.6 billion in expanding and upgrading centres. These projects have and are expected to produce yields in excess of the cost of funds, which together with the improving performance of the existing portfolio, is expected to underpin further growth in distributions.

1998 was a particularly active year for investment in projects. Five projects totalling $200 million (Westfield Trust share – $150 million) were opened and many more are in construction and planning stages.

“An important element in these developments has, and will continue to be, a focus on lifestyle and entertainment which has proved so successful in attracting new shoppers and ensuring their visits are not only longer, but more enjoyable.”

Mr Lowy said the Trust was also constantly seeking opportunities to grow the portfolio by sound acquisitions. During the year the Trust acquired a 46.6% investment in the St Lukes Group for $276 million. The St Lukes Group is New Zealand’s premier shopping centre owner, with 10 centres generating NZ$1.2 billion in retail sales.

“A further contribution towards our strong result for the year came from the constant management effort that keeps the shopping centres relevant to their local shoppers’ demands and attractive to retailers who want to build good businesses. The combination of investing in developments, acquisitions and sound management has yielded strong results for Westfield Trust in 1998.”

As part of our three-yearly revaluation cycle, 10 properties were revalued during the year resulting in a revaluation surplus of $77.8 million.

Mr Lowy said Westfield Trust was well placed for the future given the underlying strength of its shopping centre assets.