Westfield to sell Innaloo
The Australian Competition and Consumer Commission (ACCC) will not oppose the proposed acquisition of Karrinyup Shopping Centre in Perth by Westfield Group and Westfield Retail Trust after accepting a court enforceable undertaking to divest their ownership of a nearby shopping centre at Innaloo.
The Karrinyup Shopping Centre is a regional shopping centre located in north west metropolitan Perth, anchored by a David Jones and a Myer.
Westfield and WRT currently have a 33 per cent interest in the centre. Westfield Innaloo is located 3km from Karrinyup and is a sub-regional shopping centre owned by Westfield and WRT.
Westfield Innaloo is anchored by discount department stores and its retail mix also includes supermarkets and specialty retailers.
“During its market inquiries, the ACCC focused on whether the proposed acquisition would be likely to result in Westfield and WRT extracting higher rents from retailers seeking to lease retail space in north west metropolitan Perth,” ACCC Chairman Rod Sims said.
“In particular, the ACCC considered how the proposed acquisition would affect retailers relying on comparison shopping such as clothing, footwear, jewellery and gift stores,” he said.
The ACCC found that there is limited alternative retail space available in north west metropolitan Perth, and retail space at Westfield Innaloo and Karrinyup Shopping Centre are close alternatives.
While Westfield Innaloo is currently a sub-regional shopping centre and does not benefit from a department store, Westfield Innaloo has been able to successfully attract retailers which rely on comparison shopping.
The ACCC also found that neighbourhood shopping centres do not provide an effective alternative for retailers especially those relying on comparison shopping.
The ACCC was concerned that if the proposed acquisition proceeds, the ownership by Westfield and WRT of these two competing shopping centres may result in a substantial lessening of competition, by reducing the options available to retailers and customers in this area of Perth.
The ACCC has accepted a court enforceable undertaking, which will require the divestiture by Westfield and WRT of Westfield Innaloo to a purchaser approved by the ACCC in the event that the proposed acquisition proceeds.
“The undertaking provides an effective remedy to the ACCC’s concerns. It allows for the establishment of an effective, long term competitor to Westfield and WRT in north west metropolitan Perth if Westfield and WRT decide to proceed with the proposed acquisition of Karrinyup,” Sims said.
“Taking into account the court enforceable undertaking, the ACCC is satisfied that the proposed acquisition is unlikely to substantially lessen competition in north-west metropolitan Perth.”
Less than 4 days away, Inside Retail Live is back w/ an amazing speaker line-up & an all new choose your own advent… https://t.co/5M5wdindHM10 hours ago
David Jones' comp store sales were down 0.5 per cent in the first half of FY20, the department store revealed this… https://t.co/vkai4ow7j012 hours ago