We’ve contemplated the future fitness—and mere existence—of shopping malls for a long time now at JCK.
But our forecasts sharpened slightly yesterday when French shopping mall owner Unibail-Rodamco announced it will buy Australian shopping mall owner Westfield Corp. for $15.7 billion.
Australia’s Westfield is valued at $32 billion and operates 35 shopping centers in the United States and United Kingdom, including NYC’s Westfield World Trade Center in the eye-popping Oculus and the Century City mall in L.A. Unibail-Rodamco owns 71 shopping centers throughout Europe, including 25 in France.
In this marriage, Unibail-Rodamco is taking Westfield’s name. The company will rebrand its malls with the red Westfield logo.
Consolidation is a classic power move in retailing, deployed expressly to decimate competition. And in our current clicks-and-bricks climate, the consolidation of huge retailers is becoming more common as brick-and-mortar giants grapple with steep competition from online juggernauts. (See Amazon’s purchase of Whole Foods this year and Walmart’s swallowing of Jet in 2016.)
Westfield said Unibail-Rodamco’s offer was simply too good to pass up.
“Unibail-Rodamco’s track record makes it the natural home for the legacy of Westfield’s brand and business,” Westfield chairman and cofounder Frank Lowy said in a company statement.
The French brand reported that Westfield shareholders will receive a combination of cash and shares, valuing Westfield at $7.55 a share, and detailed that the deal will birth a retail property business with $72 billion of gross market value in 27 retail markets.
Lowy, who founded Westfield in 1960, plans to retire following the sale. His sons Steven and Peter will also retire from their posts as co-chief executives.
The brand’s expansion in the U.S. began with its purchase of the Trumbull Shopping Park in Connecticut in 1977. Westfield built up several malls on both coasts before expanding in the midwest.
Unibail-Rodamco is headquartered in Paris and is the largest commercial real estate company in Europe.
It was created via a merger in June 2007; French company Unibail merged with Dutch business Rodamco Europe. The company now manages shopping centers, convention centers, and office properties.
Photo: Westfield World Trade Center mall in NYC (courtesy Westfield)