What: Unibail-Rodamco-Westfield reported a positive performance for its UK operations in 2023, with increased tenant sales and footfall, improved rent collection, and significantly reduced vacancy rates in its London Westfield malls.

Why it is important: The company's strong performance in the UK, particularly in terms of sales growth, higher footfall, and lower vacancies, indicates a robust recovery and growing consumer confidence in the retail sector post-Covid, showcasing the resilience and appeal of physical retail spaces.

Unibail-Rodamco-Westfield, the entity behind London's prominent Westfield shopping centres, has demonstrated a solid performance in the UK for the fiscal year 2023. The company reported a 5.2% increase in tenant sales and a 6.1% rise in footfall within its UK malls, signalling a healthy recovery and growing consumer engagement in the retail sector. Although specific monetary values were not disclosed, these percentage increases highlight the positive momentum.

In addition to sales and footfall improvements, Westfield UK also achieved a 98% rent collection rate, surpassing the global average of 97% and reaching pre-pandemic levels. Furthermore, the company witnessed a significant reduction in vacancy rates, dropping from 9.4% in FY22 to 6.9% in FY23, reflecting the attractiveness of its retail spaces to both tenants and shoppers.

The past year saw several key developments within Westfield's UK malls, including expansions, new store openings, and upsizings by major brands such as Primark, TK Maxx, Watches of Switzerland, Sephora, and Zara. These developments, despite an initial setback with House of Fraser's exit, underscore the malls' continued draw for leading retailers and their commitment to enhancing the shopping experience for visitors.

Overall, Unibail-Rodamco-Westfield's positive performance in the UK market underscores the enduring appeal of physical retail spaces and the strategic importance of offering diverse and high-quality shopping experiences to attract consumers and tenants alike.

Westfield UK performance looks good as sales rise, vacancies fall