COVID-19: Scentre Group offers rent lifeline to mall retailers
One of the nation’s biggest shopping centre landlords, Scentre Group, has offered a minor concession to retailers, saying it will work with them in the current coronavirus pandemic crisis that has turned many centres into ghost towns and sent retail sales off a cliff.
The olive branch will be strongly welcomed by the country’s $320 billion retail sector, where many chains rent out space in a Scentre mall or other shopping centre owned by big investors such as Unibail-Rodamco-Westfield, GPT, AMP or superannuation funds. And many tenants are screaming out for rent relief in the midst of the social and economic dislocation.
The hopes for rent relief, although not mentioned by name by Scentre in a market update on Wednesday by its chief executive Peter Allen, will be high among retail chains and the issue is looming as a major source of tension as the economy splutters towards a halt and dips into a possible recession.
“All our Westfield centres remain open for trade and we acknowledge their importance in delivering goods and services to the community as well as supporting employment and economic activity across the nation,’’ Allen said on Wednesday.
“We will continue to manage and operate our centres to ensure the wellbeing of our customers and retail partners. This includes a heightened focus on high standards of cleanliness and hygiene. We are also working with our retail partners as they manage their business through this volatile period.”
Peter Allen, CEO of Westfield shopping centre owner Scentre Group. Picture: Hollie Adams/The Australian
Meanwhile the Australian Retailers Association has confirmed that on Monday it spoke to the Shopping Centres Council, the peak body for shopping centre owners, to stress the dire state of the sector and the calls from its retail members to open industry-wide discussions for action on rent.
ARA chief executive Russell Zimmerman told The Australian that he had spoken to Small Business minister Michaelia Cash on the issue and was hopeful retailers and shopping centre owners could meet to flesh out the rent issue.
Some of the anger over shopping centre rents was again pushed this week by Mark McInnes, the chief executive of billionaire Solomon Lew’s Premier Investments fashion investment empire, who called on landlords to adjust their rental demands to the realities of the current retail and economic crisis.
“Landlords have a major role to play to ensure retailers can operate in the short term for the long-term benefit of all stakeholders. Since the outbreak of COVID-19, we have closed two stores in Hong Kong and we are prepared to close many more stores globally if landlords do not respond to the current crisis,’’ McInnes says.
He and Lew are expected to say more on the issue on Friday when Premier releases its interim financial results.
This article originally appeared on www.theaustralian.com.au/property.
