Australian owner of Westfield shopping centers, Westfield Corporation is likely to be acquired by French property group, Unibail-Rodamco for $24.7 bn.
The Westfield shopping centers have been a staple in parts of the UK and the US for a number of years. In total, there are almost 35 Westfield shopping centers spread out over the expanse of the two countries.
With the acquisition by Unibail-Rodamco however, this number is likely to rise drastically. Unibail-Rodamco is rumored to own at least 71 sites around Europe, which will be useful when it comes to expanding Westfield’s reach.
Speaking of its takeover, Unibail-Rodamco stated that the acquisition would result in a “progressive roll-out of the world famous Westfield brand”.
The takeover by Unibail-Rodamco is the second major deal involving the shopping center owners in the span of a week. On December 6, Hammerson announced a £3.4bn bid for Intu.
Intu’s properties include major retail hubs like the Arndale shopping center located in Manchester. The deals with foreign companies has elevated Westfield’s status on the shopping map.
The move comes at the best time for the company since a number of shopping centers are facing steep competition from online shopping outlets.
The advancement in technology coupled with discounts and easy returns has resulted in a number of consumers shifting base to virtual stores.
The virtual stores have the added benefit of providing home delivery, which expands its reach to cover entire cities.
Contrarily, shopping centers face the disadvantage of their structure, concrete stores cannot extend their reaches beyond their immediate geographical location.
However, with more investment coming in from foreign investors, the chances for success have increased.
Investment in turn results in expansion and innovation. Thus, many shopping centers have now launched their own websites, which allow consumers to order material from the store right from the ease of their stores.
The added benefit lies in the fact that consumers also retain the option of viewing the items in the store, and may thus satisfy their doubts on quality and size.
The new investment means that Westfield may well be on its way to becoming a superstore, with statistics showing the stores may make a profit of close to €3bn in the coming years.