Countries: New Zealand
St Lukes Group and Westfield Holdings Limited today announced that they had entered into an agreement with respect to the St Lukes Group's New Zealand shopping centres.
The Chairman of St Lukes Group Limited, Mr Bill Falconer, today announced a change in the management structure of the Group with the appointment of Westfield Holdings to manage and develop the Group's $700 million shopping centre portfolio. The responsibility for management and development of St Lukes shopping centres was previously held in-house.
In addition to the appointment of Westfield, a new Chief Executive Officer of St Lukes, Mr Andrew Bennett, was announced. This appointment follows the retirement of the former CEO Mr Paul Preston, due to illness. Mr Bennett has been seconded from BT Funds Management Limited and is experienced in both asset and funds management.
Westfield Managing Director, Mr David Lowy, said Westfield's move was the next stage of Westfield's international expansion strategy. Westfield (New Zealand) will be led by Mr Grant Hirst who will report to David Lowy. Mr Hirst is a senior executive with several years experience in retail and property development.
According to Mr Falconer, the decision brings to a conclusion extensive work by the Board to determine how best to position St Lukes to meet the challenges of maintaining the company's dominant position as a shopping centre management company. The challenge comes in the face of mounting competition, particularly in Auckland where the majority of St Lukes centres are situated.
"The decision to appoint Westfield was unanimously approved by the Board of St Lukes, following a detailed proposal and discussions with key members of Westfield's management team. The major driver of the decision was the Board's expectation and confidence that Westfield would add value for the shareholders of St Lukes", he said.
Mr Falconer emphasised Westfield's pre-eminent market position as a world class manager and developer of shopping centres as well as their track record of generating superior earnings for centre owners through innovative leasing, marketing and development initiatives.
"The Board's decision was based on the expectation that Westfield will accelerate St Lukes' earnings growth over the next few years, particularly through the development of existing and new centres, to an extent which could not be achieved by augmenting current management resources", he said. "This will ultimately increase the investment value of our portfolio."
Mr Falconer went on to say that one of Westfield's key competitive strengths of particular relevance to St Lukes was their ability to provide a full and integrated shopping centre service, including management, promotion, design, development, construction and leasing. "The skills and access to worldwide resources which Westfield brings to the agreement will be a positive addition to the local knowledge of the present team", he said.
David Lowy said the move represented a geographic expansion of the integrated, retail management and development service Westfield already provides to more than 50 shopping centres in Australia, the United States and Malaysia.
The St Lukes appointment takes the total number of centres managed by Westfield worldwide to 67 and follows recent announcements of further Westfield expansion plans for its US operations and the investment by two major European-based pension funds in the Westfield Trust.
"Westfield is pleased that St Lukes has chosen it to manage the portfolio", David Lowy said. "The shopping centres are good assets and we are confident we can add value for St Lukes shareholders."
Commenting on the new management structure, Mr Falconer stressed that the St Lukes management and Board would retain absolute responsibility for the creation of value for shareholders, and that Westfield would be accountable to St Lukes management and Board in the same way that the previous divisional management had been.
"The St Lukes management team will retain responsibility for the overall management of the investment portfolio, including monitoring and supervising Westfield's performance, ensuring that development proposals will enhance returns to shareholders, and managing the company's capital funding", he said.
Mr Falconer concluded by remarking on the continued strong performance of the St Lukes Group, which he attributed to the quality of its shopping centre assets and the dedication of its team. "We look forward to further enhancing returns to our shareholders as we move into a new and exciting era in the development of St Lukes", he said.
For further information please contact:
- Bill Falconer
Chairman, St Lukes Group
64 9 302 0894
Wendy Guest
Corporate Communication Manager
Westfield Holdings Limited
61 2 9358 7426 or 61 419 414 753
- Lucy Storey
Public Relations Manager
BT Funds Management Limited
61 2 9259 3906
Westfield Group