Westfield owner to raise £3.2bn as it posts improving sales & footfall

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Westfield owner posts improving sales & footfall since lockdown
Unibail-Radamco-Westfield has also announced plan called Reset to “strengthen its balance sheet and increase financial flexibility to execute its long-term strategy”.
// Unibail-Radamco-Westfield says footfall & sales recovery in European centres improving since lockdowns
// UK Westfield footfall is in the 60%-70% range compared to last year with good week-on-week improvement
// However, UK tenant sales weaker than EU with a 70% drop in June followed by -47% in July & -34% in August

Unibail-Rodamco-Westfield has revealed plans to undergo a £3.2 billion capital raise after posting recovering footfall and sales figures across its European shopping centres.

The French shopping centre giant, which owns the two Westfield shopping centres in the UK, also announced Reset, a plan that is aimed at strengthening its balance sheet and increasing financial flexibility “to execute its long-term strategy”.

Across its Continental European shopping centres, Unibail-Radamco-Westfield said footfall was now in the 80 per cent to 90 per cent range of last year’s footfall figures.


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For Westfield London and Westfield Stratford City on their own, footfall is in the 60 per cent and 70 per cent range compared to last year.

Unibail-Radamco-Westfield added that its UK centres show “good week-on-week development as people are returning to offices following the lockdown and summer holidays”.

However, it said its US shopping centres “lags behind that in Europe as, for a number of shopping centres in Los Angeles, indoor operations remain restricted”.

“In addition, mobility in the major US cities in which the group’s shopping centres operate is well below that of most Continental European cities,” the firm added.

Unibail-Radamco-Westfield said most of its shopping centres had exited lockdown in their respective territories and reopened by June.

In terms of tenant sales, Unibail-Radamco-Westfield said they were improving across Continental Europe, with a 26 per cent decline in June improving to a 16 per cent decline in July, followed by a 12 per cent decline in August.

While there were signs of improvement in the UK as well, tenant sales remained weaker with a 70 per cent drop in June followed by a 47 per cent decline in July, and then a 34 decrease in August.

Separately, Unibail-Radmaco-Westfield said it was “making solid progress” around payment or rent and lease deals with its retail tenants, which are being negotiated on a case-by-case basis.

However, the firm said it was not interested in talks “about permanently changing lease structures or changing the basis for rent calculations”.

Despite this, it said rent collection continued to progress across all of its markets, given the circumstances of the Covid-19 pandemic.

In July it collected 72 per cent of rent, while in August it collected 70 per cent of rent.

In both months, 81 per cent of rent was collected from tenants in Continental Europe.

Meanwhile, Unibail-Radmaco-Westfield’s Reset plan features a €9 billion-plus investment to strengthen its balance sheet and increase financial flexibility to help its long-term strategy.

It consists of a fully underwritten €3.5 billion (£3.2 billion) capital raise to be used to immediately reduce leverage, something that had been rumoured – which the company denied as recent as last month.

Reset will also see Unibail-Radmaco-Westfield aim to make nearly €2 billion in cash savings and target €4 billion of disposals, which are expected to be completed by year-end 2021.

At least 50 per cent of the disposals are expected to be European retail assets.

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