Westfield owner sees malls strength as it enters Q4

French malls giant Unibail-Rodamco-Westfield has updated on trading at the end of Q3 and said that tenant sales have risen 4.3% and footfall was up 2.4% in the first nine months of the year.

It also said that like-for-like turnover has risen 9.1% with “robust” retail leasing activity. And Westfield Rise — the retail media operation — revenues rose 33.5% and are on track to deliver a €75 million net margin target in 2024.

CEO Jean-Marie Tritant said: “Thanks to continued strong operating performance, with a positive turnover trend across all activities, URW now expects to meet the higher end of its earnings guidance for 2024. 

“This performance is supported by a dynamic leasing activity as retailers’ sales continue to be strong in URW’s shopping centres. It also reflects the growth of our European retail media activity.”

Ignoring the like-for-like turnover strength for now and looking at the figures in more detail, proportionate turnover for the first nine months rose only 2% to reach €2.839 billion.

But back with the 9.1% increase in like-for-like group turnover, as well as being helped by the strong leasing activity, it was also boosted by a healthy gross rental income (GRI) performance. 

Narrowing down to the group’s retail ops, the company said year to date turnover excluding VAT at shopping centres on a proportionate basis dropped 1.1% €2.252 billion. That included GRI dipping 1.8% to €1.916 billion. But the fall was understandable as it was impacted by disposals in France, Spain and the US. Meanwhile, on a like-for-like basis it was a 4% increase, including an uplift of 4.3% in Europe and 3.1% for US flagships.

As mentioned, tenant sales levels rose 4.3% year on year, which was above the core inflation rate of 3.3% in the period. In mainland Europe the increase was 4.3%, while in the UK it was 2.7% and in US flagships it was 5.4%.

As for that leasing activity, the company said that the period saw 1,508 deals signed with the proportion of long-term deals increasing to 80% from 79% a year earlier. And the vacancy rate for the company was 5.6%, although this is expected to fall by the end of the year.