The country’s largest retail landlord has lashed out at rent relief in NSW and Victoria, saying it unjustly shifts the burden of lockdowns onto landlords and away from governments and retailers.
Scentre Group chief executive Peter Allen described government mandated rent relief as “bad policy”, saying the government, rather than landlords, should support retail tenants.
“We’re very disappointed we’re being mandated by the Victorian and now NSW governments to abate rent, transferring value directly from one industry to another, and from our security holders to retailer’s shareholders. This is bad policy.”
After NSW and Victoria reintroduced commercial codes of conduct, the Property Council said commercial landlords, already $15 billion out-of-pocket supporting tenants last year, now face further rent waivers.
Despite facing more pandemic upheaval, Mr Allen said Scentre Group is confident shoppers will flood back to its Westfield malls once national lockdowns are over and the majority are vaccinated.
Sales in Scentre’s malls bounced back strongly in the first half to June 30, to $23.4 billion, allowing the landlord to report an increased statutory profit for the six-month period of $400.4 million.
“During the first half of 2021, total sales excluding cinemas and travel exceeded total sales in the first half of 2019, even though there were a number of government lockdowns during the period,” he said. Scentre will pay out a six-month distribution of 7¢ per security on 31 August.
“The first six months has highlighted the fundamental strength of our business and its ability to rebound when restrictions ease. Whilst we are currently operating through a period of government restrictions in key markets, we are confident in the ability of our business to perform,” Mr Allen said.
He predicted malls will be busy in the lead-up to Christmas if the NSW and Victorian economies re-open as immunisation rates lift, but said he didn’t support a COVID-19 passport arrangement.