Scentre Group (ASX: SCG) announces a significant partnership transaction for Westfield Chermside in Brisbane. The Scentre Group news confirms a Dexus-managed fund will purchase a 25% interest in the shopping centre for AUD 683 million. This Scentre Group joint venture represents substantial new capital introduction into the Company’s portfolio.
Figure 1: Scentre Group headquarters reception showcasing the company’s brand identity.
The transaction follows the earlier introduction of Dexus Wholesale Shopping Centre Fund as a 25% partner in July 2025. Upon completion, Scentre Group will own 50% of the Westfield Chermside development directly, whilst retaining property management responsibilities.
Scentre Group News on Westfield Chermside Partnership
The Scentre Group news announcement confirms the purchase price represents the Company’s book value at 30 June 2025. The transaction reflects a valuation capitalisation rate of 5.00%. This marks the second major partnership transaction for Westfield Chermside within six months.
The Dexus Wholesale Shopping Centre Fund previously acquired a 25% stake in the property in July 2025. The latest transaction brings the total new capital introduced through both deals to approximately AUD 1.3 billion. Scentre Group will continue as the property, leasing and development manager for Westfield Chermside.
Scentre Group Joint Venture Strategic Rationale
The Scentre Group joint venture aligns with the Company’s long-term capital management strategy. Chief Executive Officer Elliott Rusanow stated the transactions provide further capital to pursue strategic objectives. The proceeds support sustainable growth delivery for securityholders across the portfolio.
Figure 2: Scentre Group CEO Elliott Rusanow pictured within a Westfield retail environment.
Sourcing new capital through joint ventures forms a key component of Scentre Group’s capital management approach. The Company maintains this strategy to unlock value whilst retaining operational control. The structure preserves management fees and development opportunities for Scentre Group.
Westfield Chermside Development Market Position
Westfield Chermside represents one of Brisbane’s premier retail destinations. The shopping centre forms part of Scentre Group’s portfolio of 42 Westfield destinations across Australia and New Zealand. The property contributes to the Company’s AUD 34.7 billion total portfolio valuation.
Figure 3: Exterior view of a Westfield shopping centre highlighting strong customer activity.
The Westfield Chermside development benefits from a strategic location in Brisbane’s northern suburbs. The centre serves a substantial catchment area with strong demographic fundamentals. Scentre Group’s continued management ensures operational excellence and future enhancement opportunities.
Industry Outlook and Market Context
The Australian shopping centre sector demonstrates resilient characteristics despite economic headwinds. Scentre Group welcomed 340 million customer visits in the first half of 2025. This represents a 3.0% increase or 10 million additional visits compared to the corresponding period.
Portfolio occupancy reached 99.7% as at 30 June 2025, the highest level since 2017. Business partner sales grew to AUD 13.8 billion in the half-year period, up 2.9% year-on-year. Specialty sales increased 4.5% during the same period, reflecting strong tenant trading conditions.
Financial Performance and Distribution Policy
Scentre Group delivered Funds from Operations of AUD 586.6 million for the half-year ended 30 June 2025. This represents 11.28 cents per security, up 3.2% on the prior corresponding period. Total Portfolio Net Operating Income grew 3.7% to AUD 1,042.5 million.
Figure 4: Scentre Group’s half-year 2025 FFO and distribution performance summary.
The Company declared distributions of AUD 458.6 million or 8.815 cents per security, representing 2.5% growth. For the full year 2025, distribution guidance has been upgraded to grow 3.0% to 17.72 cents per security. The second half distribution will be 8.905 cents per security.
Capital Structure and Liquidity Position
Scentre Group maintains a strong balance sheet with AUD 2.7 billion of financing resources available at 30 June 2025. Pro forma for the Westfield Chermside divestment, AUD 3.3 billion of liquidity was available. This provides sufficient coverage for all debt maturities until early 2027.
The Company completed the make-whole redemption of AUD 1.0 billion Subordinated Notes in March 2025. This was refinanced through AUD 350 million of undrawn bank facilities and AUD 650 million of new subordinated notes. The new notes carry a significantly lower margin of 2.0% compared to 4.7% previously.
Development Pipeline and Growth Opportunities
Scentre Group progresses a AUD 4 billion pipeline of future retail development opportunities. These developments target yields between 6% to 7% upon completion. The pipeline enhances the productivity and value of the existing portfolio over time.
Figure 5: Westfield shopping precinct event illustrating high foot traffic and community engagement.
The Company controls 670 hectares of strategic land holdings adjacent to existing Westfield destinations. These holdings provide significant long-term residential development opportunities. Westfield Hornsby in Sydney and Westfield Belconnen in Canberra have received rezoning approvals for over 2,100 and 2,000 dwellings, respectively.
Share Price Performance
Scentre Group shares currently trade at AUD 4.195 per security on the ASX. The stock has traded within a 52-week range of AUD 3.230 to AUD 4.270 per security. The Company maintains a market capitalisation of AUD 21.70 billion.
Figure 6: Scentre Group (SCG) 6-month share price chart demonstrating market performance in 2025.
The current share price reflects investor confidence in the Company’s strategy. The Scentre Group news regarding Westfield Chermside demonstrates effective capital management execution. The distribution growth outlook supports attractive total return prospects for securityholders.
FAQs
Q1: What is the value of the Westfield Chermside transaction?
A Dexus-managed fund will purchase a 25% interest in Westfield Chermside for AUD 683 million.
Q2: What will be Scentre Group’s ownership after completion?
Upon completion, Scentre Group will own 50% of Westfield Chermside directly and remain as the property manager.
Q3: When is settlement expected?
Settlement is expected before the end of December 2025.
Q4: How much capital has been introduced through recent Westfield Chermside transactions?
Approximately AUD 1.3 billion of new capital has been introduced through both joint venture transactions.
Q5: What is Scentre Group’s 2025 distribution guidance?
The Company has upgraded full-year distribution guidance to grow 3.0% to 17.72 cents per security.
