Scentre bosses take 20pc pay cut amid coronavirus crisis

Scentre’s board and top management agree to pay reductions as shoppers desert its Westfield malls amid COVID-19 restrictions.

A largely deserted Westfield shopping centre. Picture: Britta Campion

Mall owner Scentre Group will cut remuneration for board members and senior executives as it deals with coronavirus restrictions, and as it faces a possible counterstrike from tenants looking for rent relief.

Scentre, which operates the Westfield shopping centres in Australia, said in light of COVID-19’s impact on its operations, the board had agreed to a 20 per cent reduction in base fees.

Its senior leadership team - including CEO Peter Allen and CFO Elliott Rusanow, would take a 20 per cent cut in fixed remuneration.

The cuts take effect on May 1.

Scentre said the board would review these arrangements in August 2020. Similar cuts are also being implemented throughout the group’s broader executive team.

Scentre this month called for retailers in its complexes to open if they could, as many chains and small operators deserted its malls despite the complexes being labelled an essential service amid virus restrictions.

Shoppers are staying away in droves as governments warn people to only leave home if necessary. The resultant sharp fall in foot traffic has made it uneconomic for many stores to open.

Just 39 per cent of stores are still operating at Westfield centres across Australia, even though Mr Allen says up to 86 per cent could be open, with only a small proportion like gyms falling into “prohibited” categories.

Tension between mall owners and store chains is a precursor to looming battles over how they will reopen and the level of discount demanded on rents.

Speaking after Scentre’s annual meeting, Mr Allen said medical advice given by the federal government must be followed when determining when the economy should restart. But he argued retailers able to open should do so.

He acknowledged some confusion about messaging, but insisted shopping centres were an essential service.