Westfield, Australian Developers Report $3.4 Billion in Losses
Australian property developers Westfield Group, Centro Properties Group and Lend Lease Corp. reported $3.4 billion in losses today as the global recession wiped billions off the value of assets and retail sales plunged, Bloomberg reported.
Westfield, the world's largest shopping-center owner by market value, reported a net loss of A$2.2 billion ($1.4 billion) in 2008, from a profit of A$3.4 billion a year earlier. Centro, with more than 70 percent of its assets in the U.S., said its first-half loss doubled, while Lend Lease, building London's Olympic Village, lost A$596.4 million in the period.
Australian real estate investment trusts have lost A$92 billion in value in less than two years as a global recession and seizure in credit markets curbed consumer spending.
"Property companies are in the worst of all worlds," said Angus Gluskie, who manages about $256 million at White Funds Management Pty in Sydney. "It's all about survival. The outlook for rental returns isn't fantastic but the major thing driving property stocks lower is peoples' concern about falling values."
Westfield, which gets more than half of its sales from outside Australia, last year cut operating hours at most of its 55 U.S. malls and sold A$2.9 billion of new shares to reduce debt.