Unibail-Rodamco-Westfield Walks Away from San Francisco Mall Amid Property Crime Increase, But Rebounding Financial Performance and Store Openings Remain Strong - Trade Oracle

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Unibail-Rodamco-Westfield Walks Away from San Francisco Mall Amid Property Crime Increase, But Rebounding Financial Performance and Store Openings Remain Strong

Unibail-Rodamco-Westfield, one of the world’s largest commercial real estate companies, recently announced that it will be walking away from its San Francisco shopping mall, citing an increase in property crime in the area. Despite this setback, the company’s financial performance is rebounding, with store openings and other investments remaining strong. Unibail-Rodamco-Westfield is confident that it will be able to weather this storm and come out stronger than ever.

Property Crime Increase in San Francisco: Unibail-Rodamco-Westfield’s Response

The increase in property crimes in San Francisco has caused Unibail-Rodamco-Westfield to walk away from its namesake shopping center in the city. The company has seen a drastic decrease in foot traffic to the mall, from 9.7 million visits in 2019 to 5.6 million last year. Despite this, the company has reported a positive operating performance and is expecting an Adjusted Recurring Earnings Per Share (AREPS) of 8.2-8.4 EUR/share. Unibail-Rodamco-Westfield is also taking steps to bolster its agility, such as disposing of the SHiFT office building and forming a new Group organization. As a result, the company is trading at a big discount and is a speculative buy based on rerating potential.

Financial Performance of Unibail-Rodamco-Westfield Rebounding Despite Pandemic

The financial performance of Unibail-Rodamco-Westfield is rebounding despite the pandemic. Despite the decrease in foot traffic in the San Francisco mall, the company has managed to deliver a positive operating performance and forecasted an Adjusted Recurring Earnings Per Share (AREPS) of 8.2-8.4 EUR/share. Unibail-Rodamco-Westfield is trading at a big discount and is a speculative buy based on rerating potential. The company recently completed the disposal of the SHiFT office building, and has an extended Management Board coupled with a new Group organization to bolster its agility. This strategy has enabled Unibail-Rodamco-Westfield to remain competitive in the current market and is expected to have an AREPS of around 9 EUR/share for 2023. Store openings are outnumbering store closings in 2022 by the widest-margin in decades, providing a positive outlook for the company’s financial performance.

Store Openings and Disposals Drive Unibail-Rodamco-Westfield’s Rerating Potential

The store openings and disposals of Unibail-Rodamco-Westfield (UNBLF) have been driving its rerating potential. Despite the company’s decision to walk away from its namesake shopping center in San Francisco, California, due to the rise in property crimes in the city, UNBLF’s financial performance has recovered quickly and delivered a positive operating performance. Store openings have been outpacing store closings in 2022 by the widest-margin in decades, with the company expected to have an Adjusted Recurring Earnings Per Share (AREPS) of around 9 EUR/share for 2023. UNBLF has also been actively disposing of assets, such as the SHiFT office building, and has an extended Management Board coupled with a new Group organization to bolster its agility. This is expected to further enhance the company’s rerating potential, making it a speculative buy.

Unibail-Rodamco-Westfield’s decision to walk away from the San Francisco Mall is a testament to the company’s commitment to financial stability and store openings. Despite the increase in property crime, the company has been able to remain resilient and focus on their core business strategy of providing customers with a safe and enjoyable shopping experience. As the company continues to open new stores and increase its financial performance, it is clear that Unibail-Rodamco-Westfield is well-positioned to succeed in the future.

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