Westfield, Unibail-Rodamco have a long, bitter rivalry

Westfield and European giant Unibail-Rodamco have engaged in a protracted, high-stakes turf war over shopping malls.

The Westfield World Trade Center shopping mall. Picture: AFP

Westfield’s ties with the Unibail-Rodamco group go back almost two decades to when Westfield and the then Dutch-based Rodamco were locked in a bitter takeover battle for US shopping malls.

Back in 2001 Westfield America launched a hostile takeover bid for Rodamco North America.

The company had been part of a property investment fund set up by Dutch asset management company Robeco in 1979. In 1999 it was broken up into independent listed companies around the world, including in Europe and America.

In November 2000, Rodamco North America expanded its footprint in the US shopping mall business spending $US3.4 billion buying the Chicago-based Urban Shopping Centres Inc.

Westfield, which had been in the US since 1977, began stalking Rodamco North America in 2001.

In August 2001 it outlayed $490 million for a 24 per cent stake in Rodamco North America, which had a portfolio of 36 up-market shopping malls in the US.

At the time Westfield had a portfolio of 37 regional shopping malls in the US.

Frank Lowy said it was Westfield’s goal to create a premier US shopping centre portfolio.

It was the beginning of a bitter six-month battle for control of what was the fourth-largest shopping mall owner in the US.

At the time, Rodamco’s US chief executive Gerald Egan said he felt “sick” about the hostile bid from the Lowy group.

An aggressive Lowy called for an extraordinary general meeting of the company, proposing that Frank and his two sons, Peter and Steven, be nominated to sit on the board of Rodamco North America.

The battle resulted in a deal in January 2002, when the Los Angeles-based Westfield America Trust agreed to buy 14 of Rodamco’s US shopping malls, making it one of the biggest shopping mall owners in America.

The carve-up of Rodamco’s US malls between Westfield and two other US property groups, Simon Property and Rouse, led to a legal dispute which took years to settle.

In recent years, Westfield sold down its US malls to concentrate on a smaller group of more up-market projects, including its flagship centre at New York’s World Trade Centre and the newly opened centre at Century City in Los Angeles.

Meanwhile in 2007 Rodamco Europe merged with France’s Unibail, owner of some 30 shopping malls in France including Forum des Halles, to form Unibail-Rodamco, with the combined group owning 90 malls spread across 12 different countries in Europe.

The merger created the largest publicly traded property company in Europe, based in Paris.

In 2009 when Westfield did a $3bn capital raising, there were rumours that it might be considering a takeover bid for the newly merged Europe property group.

Westfield continued to come up against the French-Dutch group as it looked at expanding into Europe.

In 2013 it tendered for a major contract to build a 500-store mall on the French Riviera but was pipped at the post by the company.

Speculation rose in 2015 that Unibal-Rodamco would make a bid for Westfield following the spin-off of Westfield’s slower growth Australian assets in ASX-listed Scentre Group.

This made Westfield, the owner of the international shopping malls, mainly in the US and the UK, a smaller target.

But the rumoured bid did not materialise.

Today, Unibail-Rodamco is the largest commercial real estate company in Europe, managing a large portfolio of shopping centres, convention centres and office blocks.

It owns 71 shopping centres in Europe in countries such as France, Spain, Germany, the Netherlands, Sweden and Poland.

Some 55 of the malls receive more than six million visits a year.

The company has €8.1 billion worth of proposals in its development pipeline, including a new shopping mall in Poland, the extension of shopping malls in Prague and Paris and the redevelopment of a shopping mall in Barcelona.