Loading

Mall visitor numbers jumped from 50 per cent of pre-COVID levels at the start of last year to 84 per cent by the end of the year in NSW and Victoria. In states less affected by the outbreak, customer numbers were near pre-pandemic levels and retail sales growth was consistently strong, Mr Kelley said.

“Across all states, shopping remains more purposeful, with average spend per visit up 29 per cent on pre-COVID levels, with electrical, sporting goods and luxury retailers, together with discount department stores continuing to outperform the portfolio.”

Financial analysts described the result as a “big beat above consensus”. The half-year result was well ahead of expectations, said merchant bank Jefferies.

Centre sales are being buoyed by the strong local economy and restrictions on international travel, which are corralling Australians into spending at home. While the recovery from the pandemic is gaining momentum, Vicinity is not out of the wilderness yet.

The spread of Omicron continues to hit visitor numbers, particularly at city-based shopping centres like The Strand Arcade in Sydney and Emporium Melbourne where work-from-home rules and border closures are proving challenging.

“In January 2022, Omicron had a material impact on visitation, particularly at the group’s centres located on the east coast of Australia, however, Vicinity has seen an upward trend in the first two weeks of February,” Mr Kelley said.

Foot traffic in CBD shopping centres is about half of pre-COVID levels.

Vicinity’s chief financial officer, Adrian Chye, said the company expected that to increase.

Loading

“We are expecting sales and probably income to take about 24 months to come back,” Mr Chye said.

The company is still providing rent assistance to struggling tenants. Since the start of the pandemic in February 2020, it has allocated more than $300 million to support retailers. About 90 per cent of that is outright rent forgiveness, it said.

Vicinity said it expects funds from operations per security this financial year to be in the range of 11.8 cents to 12.6 cents.

The Business Briefing newsletter delivers major stories, exclusive coverage and expert opinion. Sign up to get it every weekday morning.