Explore, Connect
& Discover
2024 Annual Report
Contents
Introduction
01
FY24 Highlights
02
Letter from our Chairman, and our Chief Executive Officer
04
Operating and financial review
10
Our strategy
10
Our operations
12
How we create value
14
Executing on strategy
16
Key performance indicators
17
Year in review
18
Our portfolio repositioning
22
Our approach to sustainability
24
Our people
26
Our customers
30
Our communities
34
Our suppliers
36
Our climate and environmental initiatives
38
Our risks and risk management
46
Governance
50
Tax transparency
58
Financial report
64
Remuneration report
68
Financial statements
94
Sustainability assurance report
145
Summary of securityholders
148
Corporate directory
150
Chadstone, VIC
People
Chairman/CEO letter
Highlights
Operating and financial review
Sustainability
Customers
Vicinity Centres | 2024 Annual Report
Introduction
Disclaimer: This Report contains forward-looking statements, including statements, indications, and guidance regarding future performance. The forward-looking
statements are based on information available to Vicinity Centres as at the date of this Report (20 August 2024). These forward-looking statements are not guarantees or
predictions of future results or performance expressed or implied by the forward-looking statements and involve known and unknown risks, uncertainties, assumptions
and other factors, many of which are beyond the control of Vicinity Centres. The actual results of Vicinity Centres may differ materially from those expressed or implied
by these forward-looking statements, and you should not place undue reliance on such forward-looking statements. Except as required by law or regulation (including the
ASX Listing Rules), we do not undertake to update these forward‑looking statements.
About this report
This Annual Report is a summary
of Vicinity Centres’ operations,
activities and financial position as at
30 June 2024. In this report, references
to ‘Vicinity’, ‘Group’, ‘Company’, ‘we’,
‘us’ and ‘our’ refer to Vicinity Centres
unless otherwise stated. References in
this report to a ‘year’ and ‘FY24’ refer
to the financial year ended 30 June
2024 unless otherwise stated. All dollar
amounts are expressed in Australian
dollars (AUD) unless otherwise stated.
Sustainability-related information in this
report has been prepared in accordance
with the Global Reporting Initiative
(GRI) Standard at a core level. More
information, particularly latest Company
announcements, can be found on
Vicinity’s website.
The following symbols are used in this
report to cross-refer to more information
on a topic:
Additional information
available on vicinity.com.au
Additional information
within this Annual Report
Acknowledgement of Country
Vicinity Centres acknowledges the Traditional Custodians of the land and pays
respect to Elders past and present.
As a business that operates in many locations across the nation, we recognise
and respect the cultural heritage, beliefs, and relationship with the land, which
continue to be important to the Traditional Custodians living today.
Reporting suite
The 2024 Annual Report forms part of Vicinity’s broader reporting suite in relation to
Vicinity’s financial and non-financial performance for FY24 including:
Modern Slavery
Statement
2024
2024 Modern Slavery
Statement (to be released
December 2024)
Sustainability
Supplement
2024 Annual Report –
2024 Annual Report
Sustainability Supplement
Corporate
Governance
Statement
2024
2024 Corporate
Governance Statement
Direct Portfolio
Property Book
June 2024
2024 Annual Results
Direct Portfolio
Property Book
2024 Annual Results
Investor Presentation
The Strand Arcade, NSW
FY24 Annual Results
20 AUGUST 2024
01
Sustainability assurance
Securityholders
Directory
Communities
Suppliers
Climate and environment
Risks
Governance
Tax
Financial report
FY24
Highlights
1. Comparable Net Property Income (NPI) excludes reversals of prior year waivers and provisions, the impact of acquisitions and divestments, and development impacts.
2. Moving Annual Turnover (MAT).
Distribution per security
(FY23: 12.0 cents)
11.75¢
Portfolio occupancy
(June 2023: 98.8%)
99.3%
Weighted average drawn
debt maturity
(June 2023: 4.0 years)
4.1 years
Gearing
(June 2023: 25.6%)
27.2%
Average annual growth rate
on leases written in FY24
(FY23: +4.6%)
+4.8%
Comparable NPI growth1
+4.1%
Leasing spread
(FY23: +0.3%)
+1.1%
Specialty MAT2/sqm
(Pre-COVID: $11,403)
$12,749
Specialty occupancy cost
(Pre-COVID: 15.0%)
13.7%
Queen Victoria Building and The Galeries, NSW
People
Chairman/CEO letter
Operating and financial review
Sustainability
Customers
Vicinity Centres | 2024 Annual Report
02
Introduction
Highlights
1. National Australian Built Environment Rating System (NABERS) Sustainable Portfolio Index 2024, based on Vicinity's ownership interest and ratings as at
31 December 2023, with 96% portfolio coverage.
2. Global Real Estate Sustainability Benchmark (GRESB).
3. Net Zero portfolio comprises wholly-owned retail assets.
Indigenous and social
procurement spend
(FY23: $6m)
$8.3m
Net promoter score
(FY23: +38)
+35
Ranking in Australia and
New Zealand for Listed
Retail category
#2 GRESB2
Women in leadership
(FY23: 52%)
52%
Employee engagement score
(June 2023: 66%)
70%
Emissions intensity reduction
of Net Zero portfolio vs FY163
-38%
Customer visits
(FY23: 402m)
403m
Tenant satisfaction
(FY23: +20)
+23
NABERS1 Energy rating
4.5 Star
03
Sustainability assurance
Securityholders
Directory
Communities
Suppliers
Climate and environment
Risks
Governance
Tax
Financial report
FY24 was a very productive year
at Vicinity. We made meaningful
progress against our growth priorities
and invested in our organisational
culture and ways of working.
Our operating and financial results
in FY24 highlight resilient earnings
growth, our focus on maintaining
strong credit metrics and our active
curation of an increasingly premium
retail asset portfolio.
With our strong balance sheet
and disciplined approach to capital
deployment, Vicinity’s competitive
advantage continues to be our ability
and willingness to invest in the quality
and vibrancy of our retail assets, both
large and small.
During the year, we were very
focused on repositioning our
portfolio, which we believe will
enhance earnings resilience and
drive long-term value growth for
securityholders. As part of our
strategy, we acquired premium,
fortress-style assets with significant
growth potential and value upside,
while we concurrently divested seven
non-strategic assets at, or above
book value.
Our operational and
financial performance
It is clear that elevated living costs for
Australian households are impacting
consumption, particularly across
the discretionary goods categories.
Consistent with our expectations for
FY24, after a resilient first half, we
observed a more challenging retail
sales environment in the second
half of FY24 (2H FY24), where sales
growth was broadly flat on the prior
year, with specialty and mini majors
up 0.8%.
There is no doubt that shoppers are
more discerning and value-conscious,
as highlighted by the strong
patronage at our Outlet Centres
and across the portfolio during
the Black Friday, Boxing Day, and
Easter sales events.
Pleasingly, our CBD assets have
returned to their former vibrancy,
with retail sales up 5.4% in FY24.
Our CBD assets across Melbourne,
Sydney and Brisbane have enjoyed
the benefits of outstanding leasing
outcomes as well as the steady return
of international tourism, international
students and office workers.
Looking ahead, while the immediate
macroeconomic outlook remains
uncertain, our medium to long‑term
outlook for the retail property
sector is positive. Our outlook is
supported by the recent Stage 3
tax cuts, the likelihood of interest
rate reductions1, migration numbers
remaining high and a relatively tight
employment market.
Letter from our
Chairman, and our
Chief Executive Officer
Dear Securityholders,
We are pleased to present Vicinity Centres’ (Vicinity,
‘the Company’) 2024 Annual Report for the 12 months
ended 30 June 2024 (FY24).
Strong financial stewardship
and disciplined capital
management underpin
our approach to managing
Vicinity’s balance sheet
and credit metrics
Trevor Gerber
Chairman
We made meaningful
progress against our growth
priorities and invested in our
organisational culture and
ways of working
Peter Huddle
CEO and Managing Director
Employee engagement score
(FY23: 66%)
70%
1. Commonwealth Bank of Australia, Global Economic & Market Research, 2 August 2024.
People
Highlights
Operating and financial review
Sustainability
Customers
Vicinity Centres | 2024 Annual Report
04
Introduction
Chairman/CEO letter
Furthermore, limited supply of additional
retail space, together with sustained
tenant demand for the best centres,
underpins strong, long-term fundamentals
for the Australian retail sector, particularly
for Vicinity’s premium assets: Chadstone,
Chatswood Chase, Outlet Centres
and CBDs.
Despite the relatively flat retail sales
environment and reflecting the quality
of our retail asset portfolio, retailer
confidence to lock in high quality,
long‑term leasing deals remained robust.
Our leasing team wrote 2,053 deals this
year at positive spreads and importantly,
increased occupancy to 99.3% at
30 June 2024.
With occupancy having fallen to 98.0%
at the height of the pandemic, we have
since delivered 14 consecutive quarters
of stable or improving occupancy and
reduced income at risk (leases on
holdover) from 7.4% of income at June
2022 to 3.8% at June 2024.
Vicinity delivered a Net Profit After Tax of
$547 million, primarily comprising Funds
From Operations (FFO) of $665 million,
offset by a full year net property valuation
decrease, and other statutory and non-
cash items.
At $665 million, FFO was $20 million
lower than the prior year. Adjusting for
one-off items including reversals of prior
year waivers and provisions and the net
impact of transactions; and higher loss of
rent from development, FFO was up 3.2%.
This was driven by strong comparable
NPI growth1 and lower net corporate
overhead costs, offset by higher net
interest expense.
Comparable NPI growth of 4.1%
comprised strong rental growth, increased
portfolio occupancy and recovery
of CBDs.
We are pleased to report the portfolio
showed positive net property valuation2
growth in 2H FY24 (1H: $143 million
valuation loss; 2H: $8 million valuation
gain), with continued strong income
growth more than offsetting the minor
softening in valuation metrics.
The Board declared a full year distribution
of 11.75 cents per security, representing
a payout ratio of 95.2% of Adjusted FFO
(AFFO) (FY23: 94.9%).
Strong financial stewardship and
disciplined capital management underpin
our approach to managing Vicinity’s
balance sheet and credit metrics. At
27.2%, our gearing remains at the lower
end of our 25% to 35% target range, and
79% of Vicinity’s drawn debt is hedged.
Vicinity maintained its investment grade
credit ratings of A/stable (S&P) and
A2/stable (Moody’s) and consequently,
the Company enters FY25 in a strong
position to invest in its long-term
growth priorities.
Our Purpose, Vision and Values
As part of our pursuit to shape Vicinity as
a high performing and thriving workplace
for everyone, we know that how we
deliver our results is as important as the
results themselves.
We are delighted to present the outcome
of our enterprise-wide collaboration that
has successfully redefined our shared
Purpose, Vision and Values.
Our redefined Purpose, Vision and Values
strongly complement our existing strategic
pillars and when brought to life in unison,
we are confident Vicinity will deliver on
its strategic and financial ambitions and
at the same time, be a workplace where
high performance, diversity, inclusion,
and wellbeing are ubiquitous.
Our purpose
We shape meaningful places where
communities connect.
Our vision
To prosper with our people and
communities by creating Australia’s
most compelling portfolio of retail-led
destinations.
Our strategic pillars
Enhance the Investment Portfolio.
Deliver Property Excellence.
Maintain Strong Financial Stewardship.
Enable Good Business.
Our values
Respect. Integrity. Collaboration.
Customer Focus. Excellence.
Portfolio occupancy
(June 2023: 98.8%)
99.3%
Comparable NPI growth1
+4.1%
1. Comparable NPI excludes reversals of prior year waivers and provisions, the impact of acquisitions and divestments, and development impacts.
2. Excludes statutory accounting adjustments.
Emporium Melbourne, VIC
05
Sustainability assurance
Securityholders
Directory
Communities
Suppliers
Climate and environment
Risks
Governance
Tax
Financial report
Letter from our Chairman, and our Chief Executive Officer
Our strategic priorities
We continued to execute against our
strategic pillars and at the same time we
have maintained our disciplined approach
to capital allocation and long-term,
property-led value creation.
Executing on strategy – page 16
Enhance the
investment portfolio
Our portfolio strategy remains focused
on owning and investing in the right
assets where Vicinity has a clear, strategic
advantage, or the ability to generate
superior value over time. In this context,
we believe that premium retail assets
deliver more resilient income growth and
sustained value accretion through cycles.
In August 2024, we announced the
acquisition of a 50% interest in Lakeside
Joondalup, in Western Australia for
$420 million. Located in the northern
suburbs of Perth, Lakeside Joondalup is
a fortress‑style, premium retail asset and
already achieves almost $800 million in
annual retail sales (#2 in Perth).
As part of the transaction, Vicinity also
secured property and retail development
management rights, and we are pleased
to have entered a new partnership with
the joint owner, Australian Prime Property
Fund – Retail.
With our shared focus on property
excellence and value growth, together
with Vicinity’s property management
expertise and scalable retailer
partnerships, we believe the centre
has significant growth potential. The
acquisition is expected to be earnings
accretive in year one.
As planned, our major capital
redeployment in Western Australia
stemmed from our portfolio strategy
of owning the right assets in the
best locations.
To enable our investment in Lakeside
Joondalup and redevelopment of Galleria,
we sold four other Western Australian
centres: Karratha City, Dianella Plaza, Halls
Head Central, and Maddington Central at
a premium to book value.
Nationally, we divested seven1
non‑strategic assets in FY24 along with
sundry land parcels, which released
more than $550 million in funds for
redeployment into our growth priorities,
including acquisitions and developments.
Importantly, these disposals were executed
at a blended 9% premium to book values.
We believe that Vicinity’s ability and
willingness to invest in the vibrancy and
quality of our asset portfolio continues to
be a competitive advantage and sets us
apart from our sector peers. That said, we
remain acutely aware of the elevated costs
of capital and the industry‑wide challenges
in the construction sector, nationally.
At our 1H FY24 results in February 2024,
we communicated an elongation of our
development pipeline and prioritisation
of higher value retail developments, and
as we enter FY25, there is no change
to that approach. Today, the majority of
committed capital spend relates to two
major projects Chadstone and Chatswood
Chase, two of our premium assets, both
with significant growth potential.
Having announced the acquisition of
the residual 49% interest in Chatswood
Chase in October 2023, we took full
control of the asset in March 2024. This
paved the way for the commencement in
March 2024 of the major redevelopment
of the centre. Our redevelopment plans
for Chatswood Chase represent the
most exciting and transformational retail
development project today, and into the
foreseeable future.
While the redevelopment is not expected
to begin opening until late 2025, demand
for store space from both national and
international retailers has been strong, with
more than c.80% of the project’s income
secured2. Chatswood Chase will be a
fashion capital, housing a significant luxury
retail component, a compelling line up of
Australian and international designers, as
well as athleisure, technology, and exciting
new to market concepts.
While Chadstone has not been immune
to the challenged construction sector,
we are also well progressed on the major
retail and mixed-use development at
Chadstone, our flagship asset and one
of the top retail assets globally.
The redevelopment will see the introduction
of a revitalised fresh food precinct,
featuring retailers ranging from everyday
essentials to artisan produce, as well as
an Asian‑style alfresco dining laneway.
Accompanying the new fresh food and
dining precincts is a 20,000 sqm office
tower ‘One Middle Road’, the lower floors
of which will be fully integrated into the
retail centre.
Despite a challenging office market,
the new office tower is more than 95%
leased2, and we are delighted to be
welcoming the headquarters of major
Australian retailers, Kmart and Adairs to
One Middle Road in 2025. Our agreement
with Kmart represents the largest office
leasing deal3 in the Australian metro
markets in 2024.
Having welcomed Officeworks’ head office
to Chadstone Place in 2023, bringing
Kmart and Adairs to the growing precinct
reinforces the asset’s position as an
attractive location for top tier Australian
retail corporate offices while further
strengthening Chadstone as a major
activity centre in metropolitan Melbourne.
In June 2024, we were delighted to
receive development approval for the
major mixed-use developments at Box
Hill Central North, in Melbourne. We
now have approval for major retail and
mixed‑use developments at Victoria
Gardens Shopping Centre, Box Hill Central
North, and Buranda Village in Brisbane.
Importantly, the development approvals
are long-dated, and we will continue
to work on the operating and funding
structure which best suits Vicinity and
its securityholders. Furthermore, we
will maintain full optionality on these
sites, especially in the context of today’s
elevated cost of debt and a challenged
construction sector.
1. Completed or unconditional.
2. Via executed Heads of Agreement or Agreements for Lease.
3. By Net Lettable Area.
Acquired Lakeside
Joondalup, WA
Premium Perth asset acquired
and property and retail
development management
rights secured
People
Highlights
Operating and financial review
Sustainability
Customers
Vicinity Centres | 2024 Annual Report
06
Introduction
Chairman/CEO letter
Deliver property excellence
Delivery of property excellence positions
Vicinity’s retail and mixed-use precincts
as destinations of choice for our retail
partners, shoppers, suburban office
workers and surrounding communities.
During FY24, our Customer & Asset
Management teams delivered property
management services that ensure our
centres present as destinations of choice
for shoppers, operate efficiently, are well
maintained, and attract the best retailers,
to bring more shoppers to our centres
each year and grow retail sales.
On customer experience, our latest Net
Promoter Score was very healthy at
+35 (down slightly from +38 in FY23).
Importantly, our 2024 Tenant Satisfaction
score 1 improved, from +20 to +23,
which reflects the increased focus
we have placed on improving retailer
partnerships across our portfolio. Not only
did we improve on last year, but Vicinity
outperformed the industry average
of +18.
FY24 was another year where our
leasing executives worked at pace to
lock in leasing deals amid a resilient, but
moderating retail environment. Once
again, the structure, tenure, and value
of rents on new leases written reflects
our focus on locking in long‑term
specialty leases with fixed annual
escalators that support current and
future income growth.
During the year, 84% of new leases had
fixed 5% increases and 96% of these new
leases had increases of 4% or greater. The
weighted average lease expiry (WALE)
profile increased from 3.3 years at June
2023 to 3.6 years at June 2024.
FY24 leasing highlights included a new
Bunnings at Colonnades in Adelaide,
15cenchi at The Galeries in Sydney,
Tiffany & Co. at QueensPlaza in
Brisbane, and a new flagship Rebel store
at Emporium Melbourne including an
immersive basketball court on the rooftop.
Weighted average lease expiry
(June 2023: 3.3 years)
3.6 years
1. Measured by the Australian Consumer and Retail
Studies unit at Monash University.
The Galeries, NSW
07
Sustainability assurance
Securityholders
Directory
Communities
Suppliers
Climate and environment
Risks
Governance
Tax
Financial report
Maintain strong
financial stewardship
Our financial stewardship continues
to be governed by the preservation
of our strong balance sheet and
investment‑grade credit ratings, together
with our disciplined approach to capital
allocation and driving efficiencies.
In an environment of elevated costs
and ongoing dislocation in construction
markets nationally, we tightened our focus
on capital deployment across our retail
and mixed-use development projects,
which resulted in an elongation of our
large scale mixed-use development
pipeline. Where we are deploying capital,
delivering returns above our cost of capital
remains a key priority and is enabled by
intense de-risking of projects from both an
income and cost perspective.
From a capital management perspective,
we issued $500 million of 10-year fixed
rate, Australian Dollar denominated
medium-term notes (AMTNs), increasing
our weighted average drawn debt
maturity to 4.1 years at 30 June 2024.
The transaction further strengthened our
capital structure, which continues to be
a source of competitive advantage for
Vicinity and importantly, is a key enabler
of our active investment strategy.
Letter from our Chairman, and our Chief Executive Officer
Enable good business
Enabling good business is focused
on ensuring Vicinity continues to be
a responsible, safe, and sustainable
business. It is also about creating a
workplace and culture, where our people
can thrive. In this context, we were
pleased to see our employee engagement
increase by four percentage points
to 70%, with more than 80% of our
employees participating in the survey.
We attribute the increase in engagement
to the myriad of initiatives we have
rolled out during the year to drive
performance and team engagement.
These initiatives include a number of
leadership programs targeted at both
senior and aspiring leaders and ongoing
execution of our Diversity, Inclusion
and Belonging (DIBs) strategy, which is
anchored by our volunteer-led Employee
Advocacy Groups (EAGs) of Pride & Allies,
Disability & Access, Cultural Diversity
and Gender Balance.
Furthermore, the mental health and
wellbeing of our teams is of paramount
importance and during FY24, we invested
in our systems, policies and strategies
that enable our people to work ‘Safer,
Healthier Together’. We established
an expanded wellbeing platform, and
augmented this with a new Employee
Assistance Provider, Assure. Our new
platform provides employees with
a diverse range of tools, topics, and
support forums to guide work, health,
and life priorities.
Weighted average drawn
debt maturity
4.1 years
NEW
Purpose, Vision and Values
launched driven by enterprise
wide collaboration
People
Highlights
Operating and financial review
Sustainability
Customers
Vicinity Centres | 2024 Annual Report
08
Introduction
Chairman/CEO letter
Our sustainability journey
At Vicinity, we recognise the importance
of sustainability in our business and
more so than ever before, we are
approaching our Environmental, Social,
and Governance (ESG) priorities and
commitments with a high degree of focus.
Our ESG program continues to be well
recognised by our equity and debt
investors and we have maintained our
high ratings across important industry
benchmarks, notably GRESB1. Our
portfolio average NABERS 2 ratings for
energy and water are a source of pride for
us, but as always there is more work to do.
We remain on track to deliver on our Net
Zero 2030 Target for Scope 1 and Scope 2
emissions across the common mall areas
of our wholly-owned retail assets.
We have also made significant progress
in our social priorities. Our commitment
to local communities is evident through
our Innovate – Reconciliation Action Plan,
our Community Action Plans, expanded
Community Grants program, and our
Vicinity Cares platform, which facilitates
donations, fundraising, and volunteering
opportunities.
Our outlook for FY25
and beyond
FY24 was a successful year at Vicinity,
showcased by the achievement of our
operating and financial objectives and
the momentum of strategic execution.
It was also an important year for our
organisation, culturally. We enter FY25
with a clear strategy and with a set of
company values that will shape Vicinity as
a place where people feel safe, respected
and where everyone has the opportunity
to thrive.
Our portfolio repositioning, combined
with developments underway, and our
expectations for improving retail sales
growth over FY25, will see our earnings
profile strengthen into future years,
despite some near-term dilution from
asset sales and development impacts.
We will maintain our disciplined approach
to deploying capital and importantly, our
balance sheet will continue to be managed
for the long-term, where low gearing,
high near-term interest rate hedging and
our strong credit metrics remain guiding
principles for our capital management.
Our thanks
In closing, together with our Board
colleagues and the Executive Leadership
Team, we would like to acknowledge
and thank everyone who is affiliated
with Vicinity for their ongoing support,
most especially our securityholders,
retail partners, joint venture and capital
partners, customers and of course, the
Vicinity team.
Yours sincerely,
Trevor Gerber
Chairman
Peter Huddle
CEO and Managing Director
1. Vicinity was ranked #2 in Australia and New Zealand for the Listed Retail category by GRESB.
2. Vicinity has a 4.5 Star NABERS Energy rating and a 3.7 Star NABERS Water rating.
QueensPlaza, QLD
09
Sustainability assurance
Securityholders
Directory
Communities
Suppliers
Climate and environment
Risks
Governance
Tax
Financial report
Operating and financial review
This section outlines the key drivers of Vicinity’s operational and financial performance
for the 12 months to 30 June 2024.
Our strategy
At Vicinity, how we work together to deliver results is as important as the results themselves. In this context, FY24 was an important
year for Vicinity, where we explored, workshopped, and ultimately redefined our organisational Purpose, Vision and Values.
This year-long exercise incorporated an enterprise-wide collaboration, involving a series of listening and feedback sessions and
workshops where everyone at Vicinity, from our centre teams to our corporate office functions, had the opportunity to contribute.
With the broad reaching co-creation of our values with team members across the country, we launched a refreshed Purpose, Vision and Values
that we all contributed to and are accountable for.
When brought to life in unison with our strategic pillars, we are confident Vicinity will deliver on its strategic and financial ambitions
and at the same time, be a workplace where high performance, diversity, inclusion, and wellbeing are ubiquitous.
2024 Corporate Governance Statement
Our risks and risk management – page 46
Remuneration report – page 68
Vision
To prosper with our people and communities by creating Australia’s most compelling portfolio of retail-led destinations
Strategic
Pillars
Enhance the
investment portfolio
Deliver property
excellence
Maintain strong
financial stewardship
Enable good
business
Owning and investing in the
right assets where Vicinity has
a clear strategic advantage
or the ability to generate
superior value over time.
Intensive operational
management of Vicinity’s
portfolio to provide
exceptional service to our
tenants and our customers,
growing ancillary income
streams, and enhancing the
operational efficiency of
our assets.
Prudent capital management
to preserve balance
sheet flexibility and
investment‑grade credit
ratings to enable Vicinity to
invest in growth opportunities
while prudently delivering
securityholder returns.
The Company is governed by
principles and frameworks
that enable Vicinity to
deliver its growth objectives
in a responsible, safe, and
sustainable way.
Purpose
We shape meaningful places where communities connect
Values
Integrity
Respect
Customer Focus
Collaboration
Excellence
DFO Homebush, NSW
People
Chairman/CEO letter
Highlights
Sustainability
Customers
Vicinity Centres | 2024 Annual Report
10
Operating and financial review
Introduction
The Strand Arcade, NSW
11
Sustainability assurance
Securityholders
Directory
Communities
Suppliers
Climate and environment
Risks
Governance
Tax
Financial report
Note:
Totals may not sum due to rounding
Wholly-owned
Jointly-owned
Number of shopping centres
% Portfolio value
Operating and financial review
Our operations
Vicinity has a large, unique, and diversified asset portfolio across Australia, comprising
561 shopping centres, which are located within 30 minutes’ drive for around two thirds
of the Australian population.
KARRATHA CITY2
GYMPIE CENTRAL
ARMIDALE CENTRAL
HARBOUR TOWN PREMIUM OUTLETS GOLD COAST
LAKE HAVEN CENTRE
MANDURAH FORUM
DFO PERTH
ELLENBROOK CENTRAL
GALLERIA
LAKESIDE JOONDALUP3
LIVINGSTON MARKETPLACE
MADDINGTON CENTRAL2
ROCKINGHAM CENTRE
VICTORIA PARK CENTRAL
WARWICK GROVE
CASTLE PLAZA
COLONNADES
ELIZABETH CITY CENTRE
WHITSUNDAY PLAZA
HALLS HEAD CENTRAL2
ALTONA GATE
BAYSIDE
BOX HILL CENTRAL NORTH
BOX HILL CENTRAL SOUTH
BROADMEADOWS CENTRAL
CHADSTONE
CRANBOURNE PARK
DFO ESSENDON
DFO MOORABBIN
DFO SOUTH WHARF
DFO UNI HILL
EMPORIUM MELBOURNE
MORNINGTON CENTRAL2
MYER BOURKE STREET
NORTHLAND
OAKLEIGH CENTRAL
SUNSHINE MARKETPLACE
THE GLEN
VICTORIA GARDENS SHOPPING CENTRE
BANKSTOWN CENTRAL
CARLINGFORD COURT
CHATSWOOD CHASE
DFO HOMEBUSH
NEPEAN VILLAGE
QUEEN VICTORIA BUILDING
ROSELANDS
THE GALERIES
THE STRAND ARCADE
WARRIEWOOD SQUARE
EASTLANDS
NORTHGATE
BURANDA VILLAGE
DFO BRISBANE
GRAND PLAZA
QUEENSPLAZA
TAIGUM SQUARE
UPTOWN
WA
QLD
SA
NSW
VIC
TAS
12
19
2
3
11
9
12%
4%
10%
22%
50%
2%
BRISBANE
SYDNEY
ADELAIDE
PERTH
MELBOURNE
HOBART
1. Vicinity’s directly-owned portfolio (Direct Portfolio).
2. Asset divested post 30 June 2024.
3. Asset acquired post 30 June 2024 and not included in portfolio data.
People
Chairman/CEO letter
Highlights
Sustainability
Customers
Vicinity Centres | 2024 Annual Report
12
Operating and financial review
Introduction
Note: Totals may not sum due to rounding.
1. Vicinity’s directly-owned portfolio (Direct Portfolio).
2. Reflects Vicinity’s ownership share.
Shopping centres
561
Direct Portfolio value2
$14.7b
Gross lettable area (GLA)
2.4m sqm
Total land area
5.1 m sqm
Joint Venture partners
18
Partner assets
$8.4b
Income by store type1
Department Store
Discount Department Stores
Supermarkets
Specialties and Mini Majors
Non retail
Other retail
4%
5%
7%
70%
9%
5%
Value by centre type1
Super Regional
City Centre
Outlet Centre
Major Regional
Sub Regional
Regional
23%
13%
16%
15%
Neighbourhood
1%
17%
14%
Emporium Melbourne, VIC
13
Sustainability assurance
Securityholders
Directory
Communities
Suppliers
Climate and environment
Risks
Governance
Tax
Financial report
How we create value
Vicinity’s business model operates in, and impacts, a broader value chain, and is informed
by our Purpose, Vision and Values, strategy, governance structure, risks and opportunities,
and consideration of material stakeholder issues.
Remuneration report – page 68
Our strategy – page 10
Our risks and risk management – page 46
E
NA
BL
E
G
O
OD
B
US
IN
ES
S
EN
HA
NC
E
T
HE
I
N
VE
ST
M
EN
T
PO
RT
FO
LI
O
DE
LI
VE
R
PR
OP
ER
T
Y
EX
CE
LL
EN
CE
OUR STRATEGY IS UNDERPINNED BY
four strategic pillars
M
AI
N
TA
IN
S
TR
O
N
G
FI
N
AN
CI
AL
S
TE
W
AR
DS
HI
P
Our resources
Our strategy to create value
OUR REAL
ESTATE ASSETS
INVESTOR CAPITAL
OUR COMMUNITY
RELATIONSHIPS
OUR ENVIRONMENT
OUR CUSTOMERS
OUR PEOPLE
Operating and financial review
People
Chairman/CEO letter
Highlights
Sustainability
Customers
Vicinity Centres | 2024 Annual Report
14
Operating and financial review
Introduction
Year in review – page 18
Operational performance – page 18
Our portfolio repositioning – page 22
Our customers – page 30
Operational performance – page 18
Our portfolio repositioning – page 22
Value creation outcomes
Value drivers
More information
Sustained value growth
Delivering resilient earnings growth and
returns for equity, debt and Joint Venture
partners through cycles.
— Total return
— Funds from operations
— Distribution per security
— Strong balance sheet
— Expanding Joint Venture partnerships
Enhanced portfolio
Retail and mixed-use precincts are
destinations of choice for shoppers,
retailers, suburban office workers and
surrounding communities.
— Owning the right assets in strategically
important locations
— Active curation of asset portfolio
— Pipeline of value enhancing retail and
mixed-use development projects
— Investment in ambience, retail mix
and mall finishes
Winning with our customers
Retailers and shoppers choose Vicinity
destinations every time.
— Customer experience (NPS)
— Tenant satisfaction
— Visitation and retail sales growth
— High levels of occupancy
— Appropriate occupancy cost ratio
Thriving workplace for everyone
A high performance culture where
organisational values and ways of
working are an enabler of strong
performance and promote a thriving,
safe work environment for everyone.
— Employee engagement
— Continued improvement in diversity,
inclusion and belonging
— High standards of health, safety
and wellbeing
— Strong alignment between performance,
recognition, opportunity and reward
Prospering partnerships
Partnerships with suppliers and communities
are underpinned by long-term, mutual
value creation.
— Supply chain governance
— Community engagement and contribution
— Considered stakeholder engagement
Resilient portfolio and purposeful ESG
Delivering positive environmental outcomes
enabled by resource efficiency and
operational effectiveness.
— Pathway to Net Zero 2030 Target
— Energy, waste and water efficiency
— Highly ranked by Australian and
global benchmarking
— Pragmatic deployment of capital
to sustainability initiatives
Our people – page 26
Our suppliers – page 36
Our communities – page 34
Our climate and environmental
initiatives – page 38
2024 Corporate Governance Statement
2024 Sustainability Supplement
15
Sustainability assurance
Securityholders
Directory
Communities
Suppliers
Climate and environment
Risks
Governance
Tax
Financial report
Executing on strategy
Strategic pillar
FY24 achievements
FY25 focus area
Enhance the
investment
portfolio
— Acquired remaining 49% of Chatswood Chase
— Major capital redeployment to two premium
assets, Chatswood Chase and Lakeside Joondalup
— Secured management rights at Lakeside
Joondalup, providing opportunity to drive asset
performance
— Divested $550 million of non-strategic assets at
9% premium to book values
— Progressed major developments at Chadstone,
including One Middle Road office tower; now
more than 95% leased1
— Completed fresh food and dining development at
Chatswood Chase, and commenced major retail
development securing c.80% of income1
— Secured development masterplan approvals
for major mixed-use developments at Victoria
Gardens Shopping Centre and Box Hill
Central North
— Increase exposure to premium malls
and Outlet Centres through selective
acquisition activity
— Divest full or partial interests in selected
assets to release capital for more attractive
investment opportunities
— Complete major redevelopment projects
including Chadstone fresh food and
One Middle Road, and materially
advance Chatswood Chase major retail
redevelopment
Deliver property
excellence
— Improved occupancy to 99.3%
— Active portfolio remixing, completing over
2,000 leases and extending WALE, with an
average leasing spread of +1.1% on comparable
leasing deals2
— Optimised Vicinity’s Media operating model
through partnership with Cartology, delivering
greater certainty of income and enhanced
commercial value
— Net promoter score of +35 (FY23: +38)
— Tenant satisfaction of +23 (FY23: +20)
— Continue to increase occupancy levels,
reduce holdovers, and extend WALE
— Increase ancillary income revenue
— Implement initiatives to drive further
centre efficiencies
— Improve consumer and retailer
satisfaction scores
Maintain
strong financial
stewardship
— Issued $500 million 10-year AMTNs extending
duration at favourable pricing
— Negotiated $675 million of new or extended
bank debt
— Prudent gearing maintained at 27.2%,
while successfully funding acquisition and
development activity
— Optimise the cost of debt, while
appropriately managing diversity of funding
sources, debt expiry profile and hedging
activity
— Continue to strengthen investor
relationships to harness equity from new
and existing capital partners
Enable good
business
— Launched new Purpose, Vision and
Values framework
— Improvement in employee engagement to 70%
(FY23: 66%)
— Installed 2.4MW of solar at Grand Plaza (portfolio
total of 35.9MW)
— Commenced transformation project to
enhance Vicinity’s end-to-end leasing process
(Project Optimus)
— Achieved ISO 27001 certification for
information security
— Continue to increase employee
engagement, year on year
— Embed Vicinity’s refreshed Values and
Behaviours to uplift culture
— Targeting 40:40:20 gender diversity
— Refresh the Group's sustainability strategy,
including review of environmental targets
— Materially advance leasing
optimisation project
— Apply new data, digital and technology
solutions to optimise business performance
Operating and financial review
1. Via executed Heads of Agreement or Agreements for Lease.
2. Comparable leasing deals exclude development deals, reconfigurations and third party assets.
People
Chairman/CEO letter
Highlights
Sustainability
Customers
Vicinity Centres | 2024 Annual Report
16
Operating and financial review
Introduction
Key performance indicators
FY19
FY20
FY21
FY22
FY23
FY24
Page
Financial
Net profit after tax ($m)
346.1
(1,801.0)
(258.0)
1,215.2
271.5
547.1
19
FFO per security (cents)
18.0
13.7
12.3
13.1
15.0
14.6
19
Distribution per security (cents)
15.9
7.7
10.0
10.4
12.0
11.75
19
Comparable net property income growth (%)
1.5
NR
NR
NR
NR
4.1
18
Total return (%)
3.7
(18.9)
(2.6)
12.5
2.6
5.3
80
Total securityholder return (%)
0.6
(39.9)
15.0
21.8
6.4
6.9
80
Portfolio
Number of retail assets
62
60
59
59
59
56
18
Occupancy rate (%)
99.5
98.6
98.2
98.3
98.8
99.3
18
Total MAT ($b)
16.5
15.0
14.2
NR
18.6
18.4
18
Specialty MAT/sqm ($)
11,083
9,770
NR
NR
12,644
12,749
18
Leasing spreads (%)
(2.0)
(4.0)
(12.7)
(4.8)
0.3
1.1
18
Specialty occupancy cost (%)
15.0
NR
NR
NR
13.5
13.7
18
Weighted average capitalisation rate (%)
5.30
5.47
5.49
5.30
5.47
5.65
106
Net promoter score
33
31
45
42
38
35
32
Customer visits (m)
NR
413
344
333
402
403
30
Capital
Total assets ($b)
17.0
15.2
14.3
15.6
15.6
15.7
20
Net tangible assets per security ($)
2.92
2.29
2.13
2.36
2.30
2.30
20
Gearing (%)
27.1
25.5
23.8
25.1
25.6
27.2
21
Weighted average cost of drawn debt (%)
4.5
3.6
3.6
4.3
4.6
4.9
21
Weighted average drawn debt duration (years)
NR
7.8
5.8
4.8
4.0
4.1
21
Proportion of debt hedged (%)
89
89
96
85
90
79
21
Interest cover ratio (times)
4.4
3.9
5.1
4.7
4.6
4.2
21
People
Engagement score
68
64
61
68
66
70/7.41
26
Women in leadership
37
45
46
49
52
52
26
Women in senior leadership
NR
NR
NR
26
35
37
26
Sustainability
Community investment ($m)
3.1
5.6
3.2
2.9
4.5
7.3
34
Green Star performance – portfolio rating (Star)
4
4
4
4
4
4
38
NABERS Energy rating (Star)
3.5
3.9
4.4
4.6
4.6
4.5
38
NABERS Water rating (Star)
3.1
3.4
3.4
4.0
3.9
3.7
38
Energy intensity (MJ/sqm)
294
268
254
265
286
281
38
Managed portfolio emissions2 intensity (kg CO2-e/sqm)
67
58
54
55
51
50
38
Net Zero portfolio3 emissions2 intensity (kg CO2-e/sqm)
61
49
47
47
44
44
38
Waste diversion rate (%)
45
49
52
53
51
52
38
Solar energy generation (MWh)
4,939
28,260
37,967
41,823
42,904
43,487
38
Note: Not reported (NR).
1. The employee engagement methodology was changed during FY24 and will be a score out of 10 going forward.
2. Scope 1 and 2 emissions.
3. Net Zero portfolio comprises wholly-owned retail assets.
17
Sustainability assurance
Securityholders
Directory
Communities
Suppliers
Climate and environment
Risks
Governance
Tax
Financial report
Year in review
Operational performance
Vicinity delivered strong portfolio metrics
in FY24 which support current and future
year income growth.
As expected however, the significantly
elevated household living costs impacted
retail sales growth rates, and to a lesser
extent, leasing momentum in 2H FY24.
Vicinity’s portfolio reported total MAT
of $18.4 billion, with comparable sales
growth of 1.9% relative to FY23.
Strong retail sales growth across our
CBD portfolio, up 5.5% in 2H FY24,
was supported by the steady return
of international tourism, international
students, and office workers. Notably,
occupancy of our CBD portfolio of 99.6%,
now exceeds pre-COVID levels, reflecting
retailer confidence in the future of CBDs,
as well as a number of outstanding
flagship stores and new concepts
being introduced.
Across the retail categories, fresh food,
dining, and supermarket sales growth
as well as sporting goods, cosmetics,
and retail services remained positive,
while softer Apparel & Footwear and
Homewares sales reflected the cycling of
exceptional growth rates in recent years
and cost of living pressures.
There was an observable shift to value
conscious shopping, highlighted by Outlet
Centre sales growth at 5.2% in 2H FY24,
and with grocery and discount department
stores delivering comparatively stronger
sales growth than the total portfolio.
As the leading luxury landlord in Australia,
we have been delighted with the growth
of this category since we started with
nine stores at Chadstone in 2009. Not
surprisingly in today’s environment, luxury
sales growth has been relatively volatile.
Importantly however, relative to 2019,
same store retail luxury sales per metre
have increased by 45% and together with
our luxury retail partners, we have plans
to grow their network of stores across a
number of our premium assets.
Despite the relatively flat retail sales
environment overall, retailer confidence
to look through the cycle and lock in high
quality, long-term leasing deals remained
robust. The leasing team negotiated over
2,000 leases during the year and of note,
the retention rate remained elevated
at 74%.
234 vacant stores were leased in the
period which supported an increase
in portfolio occupancy, up 50 bps to
99.3% at 30 June 2024. Fixed annual
rent increases, positive leasing spreads,
and higher occupancy all contributed to
strong comparable NPI growth of 4.1%
during FY24.
Demonstrating the high quality leasing
activity and retailer confidence more
broadly, average lease duration for all
leases across the portfolio increased
from 3.3 years at 30 June 2023, to
3.6 years at 30 June 2024. Furthermore,
leases written in FY24 have an average
fixed annual escalator of 4.8%, which is
expected to support Vicinity’s resilient
underlying earnings growth profile and
asset valuations in FY25.
Having increased marginally to 13.7%
at 30 June 2024, Vicinity’s specialty
occupancy cost ratio remains at healthy
levels amid an uncertain near-term
retail environment (June 2023: 13.5%).
Importantly however, productivity of
our retailers remains a key highlight,
with specialty MAT per sqm of
$12,749, representing 12% growth
on pre‑COVID levels.
Operating and financial review
Chadstone, VIC
People
Chairman/CEO letter
Highlights
Sustainability
Customers
Vicinity Centres | 2024 Annual Report
18
Operating and financial review
Introduction
Income statement
Vicinity’s key measures of financial performance are FFO and AFFO1. Statutory Net
Profit After Tax is adjusted for fair value movements, certain unrealised and non-cash
items, amounts which are capital in nature and other items that are not considered to be
in the ordinary course of business, to calculate FFO (refer to Note 1(b) of the Financial
Report). FFO is further adjusted for continued investment of capital by Vicinity in its
assets via maintenance capital expenditure, plus leasing incentives and other capital items
to calculate AFFO. Vicinity’s distribution policy is to pay out between 95% and 100%
of AFFO.
FY24
($m)
FY23
($m)
NPI
888.4
900.2
External management fees
59.7
60.5
Net corporate overheads
(93.9)
(96.7)
Net interest expense
(189.6)
(179.2)
FFO1,2
664.6
684.8
Maintenance capex and lease incentives
(102.7)
(101.9)
Termination of interest rate swaps
—
(6.9)
AFFO1
561.9
576.0
Distribution declared
534.9
546.3
Statutory net profit after tax 2
547.1
271.5
Weighted average number of securities
4,552.3
4,552.3
FFO per security (cents)
14.60
15.04
AFFO per security (cents)
12.34
12.65
Distribution per security (cents)
11.75
12.0
Distribution payout ratio (%)
95.2
94.9
1. FFO and AFFO are widely accepted measures of real estate operating performance. They are determined with reference to the guidelines published by the Property
Council of Australia and are non-IFRS measures.
2. A full reconciliation between statutory net profit after tax and FFO is included in Note 1(b) of the Financial Report.
3. Includes reversal of waivers and provisions, and the impact of transactions.
Vicinity delivered FFO of $664.6 million
which decreased by $20.2 million, or
2.9%, compared to FY23 driven by:
— Net property income decreased
$11.8 million or 1.3%, with strong
comparable NPI growth of 4.1% –
benefitting from strong rental growth,
higher occupancy and continued
recovery of CBD assets – offset by
one-off items3, higher loss of rent
from developments and increased
operating expenses.
— External fees reduced slightly by
$0.8 million or 1.3%, with higher
fees from development and leasing,
offset by the impact of lower funds
management fees.
— Net corporate overheads reduced
$2.8 million or 2.9%, due to higher
capitalisation of development personnel
costs and lower corporate insurance
costs, offset by salary growth.
— Net interest expense increased
$10.4 million or 5.8%, driven by higher
market interest rates and completed
developments, partly offset by
asset divestments.
Adjusting for one-off items3 and higher
loss of rent from developments, FFO
increased 3.2%.
AFFO decreased $14.1 million or 2.4%,
driven by the reduction in FFO, partly
offset by the impact of the $6.9 million
settlement to terminate interest rate
swaps in FY23. Maintenance capex
and leasing incentives were marginally
higher than FY23.
Statutory net profit after tax increased
$275.6 million, principally the modest
reduction in FFO was more than offset by
a material improvement in net property
valuation movement year on year, as
Vicinity’s property valuations recorded
positive growth in 2H FY24, and net
unrealised impact of foreign exchange on
debt instruments movement year on year.
Segment information – page 100
Financial report – page 64
19
Sustainability assurance
Securityholders
Directory
Communities
Suppliers
Climate and environment
Risks
Governance
Tax
Financial report
Balance sheet – page 95
Financial report – page 100
30 June
2024 ($m)
30 June
2023 ($m)
Cash and cash equivalents
49.6
192.9
Investment properties
14,771.4
14,288.4
Investment properties held for sale1
186.6
—
Equity accounted investments
91.8
437.5
Intangible assets
164.2
164.2
Other assets
462.2
501.6
Total assets
15,725.8
15,584.6
Borrowings
4,230.2
4,073.5
Other liabilities
856.7
873.0
Total liabilities
5,086.9
4,946.5
Net assets
10,638.9
10,638.1
Financial position
The following table shows a summarised balance sheet.
Key items impacting the balance sheet
movement in FY24 include:
— Investment properties (including
held for sale) and equity accounted
investments increased $323.9 million
or 2.2%. This was impacted by the
investment spend across a number of
assets principally for development and
refurbishments, net enhancements to
the portfolio composition completed
during the year, and partially offset by
modest net valuation decline over FY24.
In addition, the Group completed the
acquisition of the residual 49% interest
in Chatswood Chase in March 2024
for $331.6 million (including purchase
price adjustments, landholder duty and
transaction costs). On completion, it
ceased to be a joint venture and the
use of equity method was discontinued.
Since then, Chatswood Chase has
been consolidated and classified
within Investment Properties. More
information is available in Notes 4 and 5
to the Financial Report.
— Increase in borrowings of
$156.7 million or 3.8%. Borrowings
(net of movement in cash and cash
equivalents) were higher due to capital
expenditure spend during the year.
Operating and financial review
Harbour Town Premium Outlets, QLD
1. Represents the unconditional divestments of Halls Head Central, Maddington Central and Karratha City.
Further information is included in Note 4(a) of the Financial Report.
People
Chairman/CEO letter
Highlights
Sustainability
Customers
Vicinity Centres | 2024 Annual Report
20
Operating and financial review
Introduction
Capital management
Vicinity’s strategy is underpinned by our
steadfast commitment to active debt
capital management to ensure the balance
sheet remains strong and to enable
Vicinity to invest in its growth priorities.
Capital management priorities this year
focused on extending the duration of the
debt profile and managing the gearing
level, investing in growth and undertaking
increased development activity. This was
enabled by:
— Issuing $500 million of 10-year AMTNs
— Negotiating $675 million of new and
extended bank debt facilities
— Divesting $550 million of
non‑strategic assets
Gearing remains at the lower end of
Vicinity’s target range of 25% to 35%
at 27.2% and the debt book remains
well diversified by instrument type,
lender, and expiry date. Over the year,
the weighted average cost of debt rose
30 bps to average 4.9% over FY24, the
weighted average duration of drawn debt
extended from 4.0 years to 4.1 years, and
on average 85% of Vicinity's interest rate
exposure was hedged. Continued robust
debt capital management sees Vicinity
maintain its high investment-grade credit
ratings of A/stable by Standard & Poor’s
and A2/stable by Moody's Ratings.
Covenant
Limit
Current
Gearing/loan to value ratio
50%
27.2%
Interest cover ratio
>1.8 times
4.2 times
FY25
0
FY26
FY28
FY27
FY30
FY29
FY31
FY32
FY33
FY34
Debt maturity profile ($m)
Bank debt drawn
Bank debt undrawn
Bonds
200
400
600
800
1,000
1,200
1,400
Bank drawn
Bank undrawn
AMTN
EMTN
GBMTN
USPP
6%
24%
27%
15%
HKMTN
2%
12%
14%
Debt sources (%)
21
Sustainability assurance
Securityholders
Directory
Communities
Suppliers
Climate and environment
Risks
Governance
Tax
Financial report
Our portfolio repositioning
Vicinity actively progressed with its Enhance the Investment Portfolio strategic pillar,
acquiring interests in two fortress-style, premium assets and substantially funding the
acquisitions through the divestment of seven non-strategic assets, with more planned
for FY25, while also progressing major development projects at two premium assets.
Operating and financial review
Premium acquisitions
Chatswood Chase, NSW
In October 2023, Vicinity announced the
acquisition of the remaining 49% interest
in Chatswood Chase in Sydney for
$307 million 1, at a 6.5% discount to
book value.
The acquisition paved the way for the
commencement in March 2024 of the
major luxury-anchored redevelopment
of the centre. It has also provided
Vicinity with greater flexibility around
development execution while providing
full exposure to future growth
opportunities for this premium asset.
Capital recycling
In addition to actively curating a higher
quality asset portfolio and to maintain
balance sheet strength, Vicinity is well
progressed on divesting non-strategic
assets to fund the two acquisitions. To
date, Vicinity has divested seven centres
for a total of $550 million at an average
of 9% premium to book values.
While this active capital recycling ensures
Vicinity’s gearing remains at the lower end
of Vicinity’s 25% to 35% target range, it is
also driving an increase in the weighting
of Vicinity’s portfolio towards premium
assets. Premium retail assets deliver
resilient income growth and sustained
value accretion through cycles.
Premium to book values
9%
Divested
$550m
1. Plus settlement adjustments.
Lakeside Joondalup, WA
In August 2024, Vicinity acquired a
50% interest in Lakeside Joondalup,
the dominant Major Regional centre in
the northern corridor of Perth, WA for
$420 million.
The centre is at the heart of Joondalup’s
CBD and is easily accessed by major
arterial roads and the adjacent train
station which services over 13 million
passengers annually. Joondalup
itself is a popular location with
local and international visitors and
the city is recognised as a vibrant
commercial, retail, educational, health
and entertainment precinct.
The acquisition further strengthens and
complements Vicinity’s premium retail
portfolio. Vicinity also secured property
and retail development management
rights. Combining Vicinity’s asset
management expertise and scalable
retailer partnerships, we believe the centre
has strong growth potential. Highlighting
the attractiveness of Lakeside Joondalup,
the transaction is earnings accretive in
year one.
Chatswood Chase, NSW
People
Chairman/CEO letter
Highlights
Sustainability
Customers
Vicinity Centres | 2024 Annual Report
22
Operating and financial review
Introduction
1. Via executed Heads of Agreement or Agreements for Lease.
Development
Development is an important part of
Vicinity’s strategic pillar, Enhance the
Investment Portfolio. Vicinity’s development
activity spans the full spectrum, ranging
from small strategic remixing, ambience
upgrades, and repurposing unproductive
department store sites, right through to
significant retail and mixed-use projects.
This ensures that retailers choose to
partner with Vicinity and that we continue
to deliver the best retail experience for
our shoppers, thereby enhancing the value
of our assets over time.
While Vicinity’s development projects in
FY24 have concentrated on two premium
sites, Chadstone and Chatswood Chase, a
number of smaller enhancement projects
were also undertaken, including four
smaller redevelopments at Bayside and
Emporium Melbourne in Victoria, Castle
Plaza in South Australia, and Nepean
Village in New South Wales.
In the context of developments, Vicinity
remains acutely aware of the elevated
costs of capital and the industry-wide
challenges in the construction sector,
nationally. At our 1H FY24 results
in February, we communicated an
elongation of our development pipeline
and prioritisation of higher value
retail developments, and as Vicinity
enters FY25, there is no change to
that approach.
Chadstone
While Chadstone has not been immune
to the challenged construction sector, the
evolution of Australia’s most prestigious
retail asset continued through FY24,
with the advancement of the major fresh
food and dining retail project that is fully
integrated into a new 10-level office tower.
Vicinity is progressing the development
of a food hall ȅThe Market PavilionȄ
with a product range spanning everyday
essentials through to market-leading
artisan and specialty food offerings as well
as a full-line Asian grocer. Also part of the
development, is a revitalised Asian-style
alfresco dining laneway, which has been
an underserviced segment of the centre.
Construction of the new 20,000 sqm
office tower ‘One Middle Road’ is
progressing, having ‘topped out’ during
the year. The tower is now more than
95% leased to the headquarters of leading
Australian retailers Kmart and Adairs who
will relocate more than 1,000 employees
to the Chadstone precinct in 2025.
Following completion, the retail project
will target a 5 Star Green Star v1.3 Design
and As‑Built rating, and the office tower
will target a 5.5 Star NABERS Energy
rating, 5 Star Green Star Buildings v1.0
and 4 Star Green Star Water rating.
Artist’s impression
Chatswood Chase
The transformation underway at
Chatswood Chase continues with the
commencement of the second stage of
the major redevelopment in March 2024.
This next stage will fulfil Vicinity's vision
to reinvent Chatswood Chase as Sydney's
fashion capital, featuring luxury retailing,
experiential dining and a new fresh
food precinct.
The major redevelopment across three
levels incorporates 60,000 sqm of new
retail spaces, with over 9,000 sqm
dedicated to luxury brands. Leasing is
progressing well with c.80% of income
already secured1, well ahead of the
planned opening in late 2025.
Complementing the premium experience
the redevelopment will deliver is the
new fresh food and dining precinct on
the centre's lower ground level, home
to c.65 new fresh food, dining and daily
essential retailers already open, with
more to come.
The redevelopment is being designed and
constructed in line with a future whole of
building 4 Star Green Star rating.
Chadstone, VIC – One Middle Road construction
Artist's impression
23
Sustainability assurance
Securityholders
Directory
Communities
Suppliers
Climate and environment
Risks
Governance
Tax
Financial report
Our approach to
sustainability
At Vicinity, we recognise that sustainability is a key component of our strategic pillar Enable
Good Business, and we are approaching our sustainability priorities and commitments
with a high degree of focus. We believe managing our material environmental, social and
governance priorities is critical to delivering long-term, sustained value for all stakeholders.
Our purposeful ESG program is anchored
by continuous improvement in our
environmental performance and strives
to create retail-led community precincts
that are well designed, environmentally
conscious, inclusive, and importantly,
provide opportunities for people to
connect and belong.
Specifically, from an environmental
performance perspective, our focus
continues to be on climate-related risk
identification and mitigation, while also
reducing our climate impacts.
Benchmarking
We communicate our sustainability
approach and performance through
direct engagement with our investors
and strategic partners, and more
broadly through participation in
global investor surveys. In FY24,
we continued to participate in
the DJSI and GRESB surveys.
— Member of the Dow Jones Sustainability
Indices (DJSI)
› Ranked in the 95th percentile
in the 2023 Corporate
Sustainability Assessment
› Included in the S&P Global
Sustainability Yearbook 20241
— Ranked 2nd in GRESB (Australia and
New Zealand Listed Retail category)
Materiality
Our business operates in an environment
that changes constantly and it is
important that we anticipate and adapt
to these changes, managing our risks
and leveraging opportunities.
Our Sustainability and Risk teams
work together to monitor all identified
material issues through the Enterprise
Risk Register and regular stakeholder
materiality assessments and assist the
broader business to implement measures
and strategies to mitigate risks and
realise opportunities.
Vicinity undertakes an external
stakeholder materiality assessment every
two years to identify our most material
environmental, social and governance
topics and to update our understanding
of our stakeholders’ evolving expectations
of Vicinity.
The assessment undertaken in FY22
identified that the following ESG topics
are of most concern or interest to
Vicinity’s stakeholders:
— Vicinity’s response to risks and
opportunities arising from climate
change adaptation and mitigation
— Diversity and inclusion, and
— Responding to changing retail
market conditions, trends, and
consumer preferences.
In June 2024, Vicinity undertook a double
materiality assessment which identified
those ESG topics of most interest to
our internal and external stakeholders
and assessed both the ESG impact and
financial materiality of these topics. The
results of this assessment will inform our
ESG disclosures in FY25, as well as the
refresh of our Sustainability Strategy.
2024 Corporate Governance Statement
2024 Sustainability Supplement
FY24 Sustainability Reporting Criteria
2024 Modern Slavery Statement
(to be released in December 2024)
FY24 Sustainability Performance Pack
Sustainability Assurance Statement – page 145
Sustainable Finance Framework
Additional sustainability-related
disclosures are made in the
following reports:
1. Yearbook members are top 15% of industry and within 30% of industry’s top-performing company.
People
Chairman/CEO letter
Highlights
Operating and financial review
Customers
Vicinity Centres | 2024 Annual Report
24
Introduction
Sustainability
The Galeries, NSW
25
Sustainability assurance
Securityholders
Directory
Communities
Suppliers
Climate and environment
Risks
Governance
Tax
Financial report
Our people
We believe our success is underpinned by exceptional people and their ability to thrive
in our organisation. With this principle in mind, we continue to invest in building and
sustaining a culture of high-performance, wellbeing and inclusivity, where diversity is
a celebrated strength at all levels.
Our focus in FY24 has been on executing against our strategic priorities whilst concurrently investing in our organisational culture and
ways of working to ensure Vicinity is a place where our teams have challenging and rewarding work, and where inclusion, belonging,
safety and wellbeing are ubiquitous.
Collectively driving towards
a common purpose
Our 2024 Employee Experience Survey
saw a four percentage point increase
in engagement score, with an 80%
participation rate. In addition, our
people took the time to share written
feedback, which gives us very valuable
insight into what is working well, and the
opportunities we have to improve our
employee experience.
During the year, the Executive
Leadership Team (ELT) has been
working with our people to embed our
refreshed strategy whilst working on a
new organisational Purpose, Vision and
Values. After showing a clear desire for,
and interest in, a strategy that better
engaged our people at all levels of the
organisation, feedback from our FY24
survey demonstrated that our refreshed
strategy is well understood, and our teams
are confident in how they can influence
its execution and drive performance.
As an important follow on from our
refreshed strategy, in mid FY24, we
launched our refreshed company Purpose:
We shape meaningful places where
communities connect.
As part of our strategic pillar Enable
Good Business, we also launched our
new organisational values in order to
provide a common understanding of what
is important to us in terms of not only
the results we deliver, but also how we
work together to deliver them.
Our new Values and Behaviours are
the product of an enterprise-wide
collaboration, where we had over 500
team members provide input into the
design and fundamentals required
to bring our Vision and Purpose to
life. The ELT considered all the input
and decided on the five Values and
associated Behaviours that our teams
can connect with, regardless of their
level in our organisation.
Chadstone, VIC – National Office
Chairman/CEO letter
Highlights
Operating and financial review
Sustainability
Customers
Vicinity Centres | 2024 Annual Report
26
Introduction
People
Our employee experience survey also
told us that direct leader support, health,
safety and wellbeing, and goal setting
were our key areas of strength.
As we move into FY25, our key focus
areas will include:
— Embedding our refreshed Purpose,
Vision and Values, ensuring our
ways of working enable our
strategic priorities,
— Developing and growing our people
through stretch opportunities
on priority projects and broader
transformation agendas,
— Reviewing and optimising our ways
of working, our processes, and
our systems, to enhance how we
collaborate and accelerate delivery of
our priorities, and
— Scaling the impact of our DIBs strategy
via our EAG action plan, to further
shape our culture.
Queen Victoria Building, NSW
27
Sustainability assurance
Securityholders
Directory
Communities
Suppliers
Climate and environment
Risks
Governance
Tax
Financial report
Our people
Building meaningful leadership
We continued to focus on building future
leadership capability, by building capability
in relation to mental health and wellbeing,
creating inclusive environments and
leading high‑performing teams.
We introduced an extensive, nine-month
leadership program for our most senior
leaders on our Business Leadership Team
(BLT). Our business leaders are key to
driving our strategy by cultivating and
leading high-performing teams, and
investing in their leadership capability
was a key priority in FY24.
In addition to the BLT leadership program,
a further 117 employees participated
in other important leadership programs,
Vicinity Essentials and Vicinity Evolve.
Both programs are tailored to employees
who are building their leadership
pathways at Vicinity. These programs
focus on equipping our employees with
requisite leadership skills and capabilities
to become future business leaders, whilst
empowering them to lead authentically.
A key component of leading
high‑performing teams is ensuring
alignment with Vicinity’s strategic
direction and goals.
Our leaders conduct both informal
and formal performance discussions
throughout the year, focused on
achieving goals, providing development
opportunities and driving the
right behaviours.
of our senior leadership
are female
(FY23: 35%)
37%
of available roles were filled
with internal candidates
44%
We are also focused on promoting people
from within the business. This supports
employee engagement, inspires future
leaders, supports retention and often,
promotes higher levels of discretionary
effort. In FY24, we were able to fill 44%
of available roles with internal candidates
from across all levels of our business.
In FY25, we will roll out workshops on
mental health and wellbeing, inclusion
and allyship for our broader teams, as
part of a program to raise awareness,
education, and skills to manage these
important areas.
We remain committed to targeting Gender
Balance of 40% female, 40% male and
20% any gender (40:40:20) across each
level of our organisation by the end of
FY25. Our gender composition across
our whole company was 62% female
representation, with 52% of leadership
roles being filled by women.
Our efforts to drive greater gender
balance in FY25 are anchored by
initiatives to increase our senior leadership
female talent, which increased from 35%
in FY23 to 37% in FY24.
In FY24, more than 76% of internal
promotions were female and importantly,
a number of these promotions were in the
BLT cohort.
Furthermore, while being focused on
driving our 40:40:20 initiative, it is
important that we maintain our strong
gender pay equity ratio1, which is just
over 1%2. On a comparable basis, Vicinity's
average gender pay gap narrowed slightly
from 35.8% in FY23 to 35.3% in FY24 for
all roles excluding the CEO. The average
pay gap in FY24 including the CEO is
38.2% (FY23: 38.7%).
1. The difference in remuneration between males and females as measured by comparison to external market benchmarks.
2. Vicinity’s pay equity ratio is not adjusted for FY25 remuneration adjustments made effective on 1 July 2024.
Chairman/CEO letter
Highlights
Operating and financial review
Sustainability
Customers
Vicinity Centres | 2024 Annual Report
28
Introduction
People
Working safer,
healthier together
Our Health, Safety, Environment
and Wellbeing Management System
(HSEWMS), together with our
Health, Safety, Environment, and
Wellbeing (HSEW) Policy and Strategy,
empowers our people to work ‘Safer,
Healthier Together’.
In partnership with the business, the
HSEW team is focused on improving
health, safety, environmental and
wellbeing performance. The HSEWMS
is aligned to ISO 45001 and ISO 14001,
and its scope includes all of Vicinity’s
operations, assets, and team members
spanning all work activities.
In FY24, we implemented the first
year of a three-year HSEW strategy of
which the key deliverables were:
— Establishing Vicinity’s HSEW risk profile,
— Completing a review of training needs
and capabilities required,
— Enhancing our safety contractor
management system, and
— Establishing an elevated and broadened
Employee Assistance Program, with
a new provider, together with an
enhanced wellbeing platform.
As part of our HSEW assurance
program, 45 of our centres conducted a
HSEW safety assessment with the key
opportunities being improved record
keeping, consistent communications,
application of risk management framework
and consistent application of education
and induction programs. Each opportunity
has a series of actions, which were
identified and implemented across
all centres.
Over the past 12 months, we have also
reviewed, refreshed, and enhanced
our risk management approach to
development safety. Some of the
initiatives arising from the review included
the elevation of development safety
risk management to the senior levels
of development governance reporting,
commencement of independently
co‑chaired monthly development project
safety reviews, and oversight of processes
and enhanced independent site audits to
monitor project safety.
Safety incidents are taken seriously within
Vicinity, and incidents are recorded in
an incident reporting system. Significant
incidents are investigated, and corrective
actions may include the issue of a safety
alert to the broader business. Where
required by legislation, Vicinity notifies
relevant work, health and safety regulators
of incidents. Where appropriate, safety
learnings are shared with our team
members and relevant stakeholders.
In FY24, we undertook a review to
ensure our incident and injury data that
was captured, measured, and reported,
aligned with Safe Work Australia and
industry standards. While some data is
not able to be compared to prior year
performance, we are confident that each
incident was reviewed in accordance
with Vicinity’s procedures and safety
management practice.
Vicinity’s lost time injury frequency
rate1 increased from 5.64 in FY23 with
11 injuries recorded, to 6.72 in FY24
with 13 injuries recorded. Vicinity’s total
recorded injury frequency rate2 was 9.31,
and zero fatalities were recorded. Driving
the increase across both measures was a
more rigorous focus on reporting incidents
in FY24.
Central to our strategy and commitment
to operate ‘Safer, Healthier Together’ are
our consultations through our HSEWMS
procedures, including site health and
safety team member meetings and HSEW
team talks which are open, honest, and
forthright with all stakeholders.
We take mental health and wellbeing as
seriously as physical safety. In addition
to leadership training, our new wellbeing
platform, Assure, was launched in FY24.
This platform provides access to a diverse
range of topics and content to guide
employees’ work, health, and life journey.
Assure provides expert resources and
access to professional support including
confidential conversations with employee
assistance program specialists, using in-
app messaging or phone.
Creating a workplace where
our teams thrive
Core to building and sustaining an
inclusive and high-performance culture is
having a strong foundation for DIBs that is
ubiquitously applied to all team members.
Central to our DIBs strategy are our
volunteer-led and ELT-sponsored EAGs:
Pride & Allies, Disability & Access, Cultural
Diversity and Gender Balance. These
advocacy groups have a meaningful
impact on Vicinity’s workplace culture
and sense of inclusivity evidenced by our
employee experience survey commentary.
This year, our EAGs helped Vicinity
celebrate important events, including
Pride Month, Harmony Week, Disability
Pride Month, and International
Women’s Day.
Importantly, our DIBs principles are
integrated into other people-led programs
spanning Mental Health and Wellbeing,
Respect@Work, refreshed Values and
Behaviours, governance reporting, and
leadership capability programs. We also
partnered with Wonnil Partners, who
advised us on how to continuously
improve our HR policies and recruitment
processes to ensure an equitable
experience for Aboriginal and Torres Strait
Islander people.
In FY24, we continued to improve our
disability recruitment experience with our
disability employment provider enabling
more diverse talent across our business.
We consider flexibility to be an important
driver of employee engagement and a
key focus of our DIBs and workplace
priorities. At Vicinity, flexibility is
more than just working from home, it
is also about flexible working hours,
compressed working weeks, working
from other Vicinity locations, as well as
the more traditional part-time and job
share arrangements.
This year, we embedded our hybrid
working approach of 60:40, which
comprises three days in the office
to support collaboration, innovation,
and development within teams and
cross‑functionally. Vicinity had an
absentee rate of 2.02%, which compares
favourably to 2.12% in FY23.
1. Lost Time Injury frequency rate measures the number of lost time injuries per million hours worked during a year.
2. Total Recordable Injury frequency rate measures the number of fatalities, lost time injuries, substitute work, and injuries requiring treatment by a medical professional
per million hours worked during a year.
29
Sustainability assurance
Securityholders
Directory
Communities
Suppliers
Climate and environment
Risks
Governance
Tax
Financial report
Our customers
Our customers – being our shoppers and our retailers – are the lifeblood of our business.
Our customer strategy is focused to Deliver Property Excellence to ensure that we
create great experiences for our customers and in doing so, ensure our customers
choose Vicinity’s assets every time.
For our shoppers, we believe it is the interplay between Precinct, Product, Place and Programs that provides the ultimate experience.
Precincts – creating compelling precincts
to meet the retail, services, cultural and
recreational needs of our communities
Product – tailoring the mix of essential
and discretionary offers within our
precincts to our shopper wants and needs
Place – making the overall shopping
experience enjoyable, efficient and safe
Programs – delivering broad or targeted
marketing programs to drive visitation and
enhance retailer performance
For our retailers, we adopt a ‘retailer first’
approach. We work closely with our retail
partners at all phases of their relationship
with us – whether it be identifying the
right site or network of sites, helping them
with tenancy designs, providing customer
data and insights, or collaborating
on marketing.
With an unrivalled portfolio offer –
Chadstone, premium CBD assets, a
leading Outlet Centre portfolio and a
range of metropolitan assets – retailers
see Vicinity as the first port of call when
opening new stores across Australia.
PRECINCT
PRODUCT
PLACE
PROGRAM
SHOPPER
EXPERIENCE
Chadstone, VIC – July luggage pop-up
People
Chairman/CEO letter
Highlights
Operating and financial review
Sustainability
Vicinity Centres | 2024 Annual Report
30
Introduction
Customers
This year we have opened a number of outstanding new and in-demand stores across the portfolio, including Tiffany & Co. at
QueensPlaza, July at The Galeries, Rebel at Emporium Melbourne, lululemon at Chadstone, and Bunnings Warehouse at Colonnades.
Shopper visits
this year
+400m
QueensPlaza, QLD
Chadstone, VIC
Colonnades, SA
The Galeries, NSW
Emporium Melbourne, QLD
31
Sustainability assurance
Securityholders
Directory
Communities
Suppliers
Climate and environment
Risks
Governance
Tax
Financial report
Our customers
How we measure our customer satisfaction
Vicinity takes feedback from shoppers and retailers very seriously, and we conduct
various surveys throughout the year, to determine levels of satisfaction and opportunities
for improvement.
Net promoter score
Vicinity Voice – our inhouse-developed
shopper research platform – continued
to deliver actionable insights this year for
our marketing, centre management and
leasing teams, and also generated our Net
Promoter Score (NPS). Our latest shopper
NPS (October 2023) was very healthy at
+35. This is particularly encouraging in the
context of significantly increased cost of
living pressures.
Tenant satisfaction
Tenant Satisfaction (TenSAT) measures
how satisfied our national brands/
national retailers are with Vicinity. Our
2024 TenSAT score1 improved from +20
to +23. Not only is the improvement
pleasing, particularly given the softer
sales environment this year, but Vicinity
also beat the industry average of +18.
We attribute the improvement to a number
of customer-centric initiatives intended to
further strengthen retailer partnerships.
Centre satisfaction
Centre Satisfaction (CentreSAT)
measures how satisfied our small to
medium enterprise, centre-based
retailers are with Vicinity. Our 2024
CentreSAT score1 improved from +35
to +47. This improvement can also be
attributed to our approach to, and focus
on, customer centricity.
Net promoter score
(FY23: +38)
+35
Tenant satisfaction
(FY23: +20)
+23
Centre satisfaction
(FY23: +35)
+47
1. Measured by the Australian Consumer and Retail Studies unit of Monash University.
People
Chairman/CEO letter
Highlights
Operating and financial review
Sustainability
Vicinity Centres | 2024 Annual Report
32
Introduction
Customers
Case Study: LEASING OPTIMISATION PROJECT
Vicinity commenced Project Optimus in late 2023, to streamline and optimise
the end-to-end leasing process — from when a retailer enquires about a space, to
opening their store for trade.
Delivering a retailer into a retail space requires multiple steps, inputs and review
points from many stakeholders. This project has already delivered early efficiency
wins and has identified further opportunities to deliver consistent quality every
time, add value to every touchpoint, and enhance the retailer experience.
This will be done through investment in our process capability, supported by
quality systems.
Upon completion, the project will deliver a material reduction in downtime for
stores when retailers vacate, ensuring they generate revenue earlier, and will also
create capacity for our people, through process improvements and efficiencies.
Project Optimus has planned go-live phases in FY25 and beyond.
Data and insights
At Vicinity, we use data and analytics
to inform our understanding of the
evolving needs and wants of our
shoppers and retailers.
Vicinity has an internal Data and Insights
team, that utilises data to inform decision
making across our business. This data-led
decision making spans our approach to
developments, how we assess retailer mix
within our centres and how we identify
our target customers and attract them
to our centres. The team is critical to
the delivery of our shopper and retailer
experiences and provides data and
insight-led guidance to our Precinct,
Product, Place and Program strategies
and initiatives.
We also use data to help identify
opportunities to drive operational
efficiencies across the business. Our
leasing optimisation project, ‘Project
Optimus’, is an example of an insight and
process-led project that is using data
metrics, improvements in process and
supporting systems, to drive better and
more effective outcomes for our retail
partners during the leasing process.
Chadstone, VIC
33
Sustainability assurance
Securityholders
Directory
Communities
Suppliers
Climate and environment
Risks
Governance
Tax
Financial report
Our communities
Vicinity’s purpose is to shape meaningful places where communities connect and
naturally, our shopping centres across Australia play a key role in building strong
connections within their local communities.
As a community-minded and
responsible organisation, we take
pride in our initiatives that help shape
better communities, enhance our
local connections, and deliver positive
social outcomes.
Incorporating youth engagement
opportunities and supporting other
localised community initiatives, our
community investment program is focused
on our role in building stronger and more
resilient communities, as well as safe,
inclusive and accessible spaces within
our precincts.
We achieve this by delivering on three
key objectives:
— Establishing a long-term community
investment program that focuses on
local priorities and delivers measurable
value to our communities,
— Creating capacity and resilience for our
communities to thrive, and
— Curating community experiences that
shape meaningful places.
Spanning our entire portfolio, our
approach comprises a multitude of
both national and community specific
initiatives that we undertake each year
which, when combined, amount to
significant community contribution,
reach and impact.
Creating meaningful places
Creating safe, accessible, and inclusive
precincts is an important component of
our strategy to build on our connections
with, and within, our local communities.
We are proud to provide access to spaces
for local fundraising and community
programs that connect our centres
and customers to important local
community initiatives.
As an organisation, we strive to create
inclusive and accessible places for centre
teams, retailers and shoppers. We pride
ourselves on our investment in disabled
parking, parents’ rooms, changing places,
high care facilities, wheelchair access
ramps, high tables in food courts for
wheelchair access, and wheelchairs
for use within centres.
Sustainability Reporting
We benchmark our community investment
activities using the Business for Societal
Impact (B4SI) Group framework. The B4SI
Verification Statement can be accessed
through the Sustainability Reporting
page on our website. In FY24, our
contributions increased to $7.3 million
(FY23: $4.5 million).
Alongside B4SI’s verification of our
community investment, for the first
year Vicinity will also disclose its total
community investment contributions.
This includes measuring marketing
initiatives that generate a community
benefit at 100% of revenue foregone
(instead of the 50% used in B4SI’s
calculations), together with direct
contributions made to government
agencies and/or relevant authorities
that fund community-based facilities,
services and programs, as part of the
developments Vicinity completes in our
centres. In FY24, our total community
investment contributions are $9.2 million.
Vicinity staff volunteering
Elizabeth City Centre, SA – Hidden Disabilities Sunflower
People
Chairman/CEO letter
Highlights
Operating and financial review
Sustainability
Customers
Vicinity Centres | 2024 Annual Report
34
Introduction
Community partnerships
SEDA Group
In February 2024, Vicinity commenced a
three-year partnership with SEDA Group,
who operate independent secondary
colleges across Australia offering industry-
based pathways to higher education and
employment. This followed an 18-month
collaboration, which raised funds for
eight new Indigenous scholarships.
The partnership supports educational
outcomes and facilitates employment
pathways for Aboriginal and Torres Strait
Islander students, with participation to
date from SEDA Colleges in WA, SA
and NT.
Follow the Dream Student Camp
For the second year running, Vicinity
sponsored the annual Follow the Dream
Student Camp in April 2024, where
a group of young Aboriginal students
attended a four-day cultural development
program. Learning from well-respected
Whadjuk Noongar Elder, Dr Noel Nannup,
the students connected themselves
to Country and further developed
their cultural identity. Students had an
opportunity to learn language, dance,
and Dreamtime stories.
Under the direction of local Aboriginal
artist Tahlia-Rae Willcocks, students also
completed an artwork depicting Yarrogun
Rock and the significance it plays in local
lore, culture, storytelling, and healing.
Community grants
Expanding on the 2023 pilot program,
the 2024 Vicinity Community Grants
program accepted applications for
community-based programs, focusing
on Vicinity’s priority areas of Youth
Engagement, Community Wellbeing,
Environment and Education. A large
number of applications were received
across a number of Vicinity’s locations,
with 16 grants successfully distributed
to the value of $110,000.
These include individual grants to:
— Biyani House Revesby Women’s Shelter
in conjunction with Bankstown Central
in NSW: To create a functional and
safe outdoor space for resident women
and children
— John’s Vision in conjunction with
Rockingham Centre in WA: To provide
free eyecare and spectacles to people
experiencing homelessness and
financial hardship
— Hope Street in conjunction with
Elizabeth City Centre in SA: To
facilitate employment and skills
workshops, mentoring and support
for at-risk youth
— Big Group Hug in conjunction with
Northland in VIC: For an environmental
refurbishment program of pre-owned
baby goods for vulnerable families.
Vicinity Cares
Vicinity Cares is our workplace social
impact platform that enables our
employees to make effective use of their
two days of paid volunteer leave and
donation-matching to the value of $500.
In FY24, 70% of team members
participated in the Vicinity Cares program,
including 19% donating to over 104
charitable organisations. Substantial
increases in our staff volunteering rate to
22% in FY24, from 9.3% in FY23, shows
an increased desire for our employees to
give back and appreciate the social, mental
health, and skills building opportunities
that volunteering provides. In FY24, the
Vicinity Lifeblood Lifesavers program
was introduced with 119 team members
signing up as blood donors, which the
Australian Red Cross Lifeblood estimates
will save 324 lives.
of team members
participated in the Vicinity
Cares program
70%
Action towards reconciliation
Our vision for reconciliation is for a future
where we are actively contributing to
the creation of positive change, respect,
acknowledgement, and opportunities
with Aboriginal and Torres Strait
Islander people.
We understand our role as asset
creators and owners is to build strong
relationships with Aboriginal and Torres
Strait Islander people and create places
that acknowledge and recognise their link
to Country. This was particularly evident
during National Reconciliation Week
with the 2024 theme ‘Now More Than
Ever’ promoted in nine languages across
our centres.
In FY24, we continued our reconciliation
journey under our third (and second
Innovate) Reconciliation Action Plan
(RAP). In our third RAP, we have further
committed to deepening relationships,
increasing cultural awareness, and
connecting Aboriginal and Torres Strait
Islander peoples with employment
and business opportunities across our
organisation. Of particular note, Vicinity’s
Indigenous procurement spend in
FY24 was $7.5 million, an increase of
$2.1 million from FY23 spend. See the
Our Suppliers section of this report for a
case study about Vicinity's engagement
with an Aboriginal electrical and
construction business in WA.
Our suppliers – page 36
Follow the Dream – artwork depicting Yarrogun Rock
Vicinity Community Grants –
Peel Community Men's Shed,
Mandurah Forum, WA
35
Sustainability assurance
Securityholders
Directory
Suppliers
Climate and environment
Risks
Governance
Tax
Financial report
Communities
Our suppliers
As one of the largest shopping centre landlords in Australia, and with a wide range of offers
within our centres, we have partnerships with a large number of suppliers that range from
larger national or state-level providers through to smaller more localised suppliers.
We acknowledge our role as a large
customer of service providers across
Australia, and the significant economic
activity generated through the operation
of our centres. As such, we take a
responsible approach to procurement and
understanding our suppliers.
We take a proactive approach to managing
sustainability risks that are inherent in
our supply chain. We also recognise that
there are unique opportunities to create
value through our relationships with
suppliers. We seek to build long-term and
sustainable relationships with our strategic
suppliers, with the aim of creating
mutually beneficial outcomes.
During FY24, we engaged 2,542 direct
suppliers to provide goods and services
for our business, with an annual
spend of $890,500,638 distributed
across our operations, developments
and refurbishments activity, and our
corporate offices.
In FY24, Vicinity continued to implement
initiatives to assess and address modern
slavery risk in our operations and
supply chain. Our 2024 Modern Slavery
Statement will be published in late 2024
and will detail the actions undertaken
by our business in FY24 to assess and
address modern slavery risks in our
operations and supply chain.
Indigenous procurement
In line with our Innovate RAP
commitments, Vicinity seeks to create
opportunities for Aboriginal and Torres
Strait Islander businesses within our
supply chain, thereby fostering ongoing
and genuine relationships with the
communities within which our centres
are located.
In FY24, we spent $7.5 million with
Indigenous businesses, primarily to
provide Vicinity with fire services,
electrical services and office equipment.
Since FY22, our cumulative spend with
Indigenous businesses is $13.5 million.
We also consider reconciliation in our
procurement processes by requesting
reconciliation disclosures in our tender
pre-qualification questionnaire to provide
our suppliers with the opportunity to
share details about their reconciliation
actions, including employment initiatives,
their own procurement strategies and
other relevant activities.
Social procurement
Vicinity procures goods and services from
social enterprises to support our broader
community engagement strategy and
contribute to positive social and economic
change for marginalised or disadvantaged
people in our communities. We also
encourage our suppliers to engage social
enterprises, disadvantaged youth and
Indigenous businesses in their operations
and supply chains.
In FY24, we spent $830,000 with
social enterprises across our managed
portfolio and continued our membership
with Social Traders, a social enterprise
procurement platform.
with Indigenous and Social
enterprises across our
managed portfolio
$8.3m
In FY24, we spent
Rockingham Centre, WA – Indigenous-owned business expo
People
Chairman/CEO letter
Highlights
Operating and financial review
Sustainability
Customers
Vicinity Centres | 2024 Annual Report
36
Introduction
Case Study: WILCO ELECTRICAL
AND KARDAN CONSTRUCTION
IN WA
Wilco Electrical and Kardan
Construction are large Aboriginal
electrical and construction
businesses in Boorloo, WA. These
businesses prioritise Aboriginal
peoples in their employment
processes, demonstrate cultural
safety in their workplace, and
provide flexibility where needed
to ensure the best chance of
success in long-term upskilling
and employment.
Where they can, both businesses
have used their platform to support
other Aboriginal businesses to
grow by providing subcontractor
opportunities, demonstrating
their role in supporting social
justice, employment and
broadly empowering the
Indigenous economy.
As a result of the ongoing
support and engagement from
Vicinity across our WA assets,
Wilco Electrical and Kardan have
increased their business confidence
to generate seven new Aboriginal
employment positions, hiring men
and women into apprentice and
assistant positions.
37
Sustainability assurance
Securityholders
Directory
Communities
Climate and environment
Risks
Governance
Tax
Financial report
Suppliers
Our climate and
environmental initiatives
Our focus
We acknowledge that climate change is one of the most significant global challenges,
presenting risks and opportunities across our business, our communities, and the
broader economy, now and into the future.
To address this challenge, we have committed to taking action to reduce our environmental footprint and contribute positively to our
communities. Our approach has three key objectives:
— Deliver our Net Zero 2030 Target1
— Strengthen agility, resilience and capacity to adapt to a changing climate
— Deliver sustainable operations and developments
1. Target is across Vicinity’s wholly-owned retail assets for Scope 1 and Scope 2 emissions (in common mall areas).
Northland, VIC
Emissions intensity
reduction of Net Zero
portfolio vs FY16
-38%
Waste diverted
52%
Solar energy generated
43,487MWh
People
Chairman/CEO letter
Highlights
Operating and financial review
Sustainability
Customers
Vicinity Centres | 2024 Annual Report
38
Introduction
Our approach to managing climate change
Our approach to managing the impact of climate change is informed by the recommendations of the Taskforce for Climate-related
Financial Disclosures (TCFD).
TCFD recommendation
Disclosure and progress
Governance
Vicinity’s Board has oversight over sustainability-related risks, including climate-related risks
and opportunities. The Board is supported by the:
— Risk, Compliance and ESG Committee which oversees Vicinity’s climate-related and other
ESG risks and opportunities.
— Audit Committee which oversees financial governance and risks and the integrity of
financial reporting and internal control processes.
— ELT which is responsible for Vicinity’s operations and delivering strategic objectives.
Strategy
A key focus of Vicinity's Sustainability Strategy is enhancing our climate resilience, reducing
our environmental impact and supporting the transition to a low‑carbon economy.
Vicinity reviews its climate-related risks and opportunities and scenario analysis regularly, with
the latest review undertaken in FY23.
Vicinity considers three Network for Greening the Financial System scenarios to assess
our exposure to transition risks – one considered orderly and two considered disorderly.
Physical climate risks are assessed over two different emissions scenarios, being moderate
(SSP2-4.5/RCP4.5) and high (SSP5-8.5/RCP8.5) and considered over medium and long-term
time horizons.
Risk management
Climate change has been identified as a material risk in our Enterprise Risk Register.
To support Vicinity in responding to this risk, an adaptation roadmap identifying key actions
and timeframes was developed in FY23.
Metrics and targets
In 2019, Vicinity set a Net Zero 2030 Target, aligned to Australia’s commitments under the
Paris Agreement (United Nations Framework Convention on Climate Change). The target
covers Scope 1 and Scope 2 carbon emissions from the common mall areas of Vicinity’s
wholly-owned retail assets.
Further information on our approach to managing climate change can be found in our Sustainability Supplement, available on
Vicinity’s website.
Sustainability Reporting
39
Sustainability assurance
Securityholders
Directory
Communities
Suppliers
Risks
Governance
Tax
Financial report
Climate and environment
Our climate and environmental initiatives
Sustainable operations and developments
To mitigate the impacts of climate change, we are committed to decarbonising our operations and developments and reducing our use
of natural resources to support sustainable operations and developments.
1. This includes Karratha City, Kurralta Central and Roxburgh Village that were divested in FY24.
2. Total renewables across CY2021, CY2022, and CY2023.
3. Using carbon credits from a legitimate offset project to undo an actual or planned emission of an equivalent amount of CO2-e.
Remove
Emissions though electrification
We are exploring opportunities to electrify building systems currently operating on fossil fuels.
Reduce
Emissions through energy
efficiency and embodied carbon
We continue to reduce energy use across the portfolio.
Energy reduction initiatives include a lifecycle replacement program focusing on lighting,
vertical transport, heating, and cooling, along with optimising building operations and
performance through building management systems.
Eliminate
Emissions through onsite and
offsite renewables
Since the first solar panels were installed at Castle Plaza, SA, in December 2018, we have
installed 35.89 MW worth of solar capacity across 23 centres1.
We consider onsite generation for all new developments.
We also provide our retailers the opportunity to purchase renewable electricity for their
tenancies via our embedded networks. To date we have provided 1,953 MWH 2 of renewable
energy to 14 tenants across 25 assets.
Substitute
Emissions from low Global
Warming Potential refrigerants
We are exploring opportunities to move to lower Global Warming Potential refrigerants as part
of our heating, ventilation and air conditioning systems replacement program.
Offset
Residual emissions
with credible carbon offsets
We acknowledge that in the short to medium-term, we will not be able to achieve net zero
operational emissions without the support of carbon offsets for direct emissions we cannot
eliminate, reduce, or otherwise substitute.
Vicinity has developed a Carbon Offsets Framework, with support from CarbonAbility, to guide
us in sourcing credible offsets3 that also support local communities and biodiversity.
Net Zero
Operational emissions
All our commercial office developments aim to achieve a 5 Star NABERS Energy rating, be gas
free and aim to reduce embodied carbon through smart material selections.
Gympie Central, QLD
People
Chairman/CEO letter
Highlights
Operating and financial review
Sustainability
Customers
Vicinity Centres | 2024 Annual Report
40
Introduction
FY24 performance
Water
Water is a scarce resource that must be
managed responsibly.
To achieve this, we are progressively
installing water submetering across the
portfolio for water intensive tenants
such as car washes and food retailers,
to increase awareness around efficient
use of water and drive behaviour
change. To date, we have installed smart
water meters across 1,300 tenancies at
31 centres, with nine more projects to be
delivered in FY25. These meters allow for
continuous monitoring of water use.
In addition, we will be reviewing existing
water meter infrastructure at 12 further
centres, with a plan to upgrade these and
connect the centre Building Management
Systems over the coming years.
Circular economy
Our centres are significant users of
materials through our developments,
refurbishment, tenant fit outs and
de-fits, and the day to day operations
of our retailers. As a result, disposal of
materials is one of our largest indirect
environmental impacts. To ensure that
as many of these materials as possible
are recycled, we provide infrastructure,
guidance and support to our teams,
retailers, and consumers across
our centres.
In FY24, we launched our first Circular
Economy Strategy to help us leverage
circular design and collaboration, that
will enable us to create low impact,
long-lasting, fit outs and precincts,
and maximise the value retained
from materials through best-practice
operational waste management.
Biodiversity
In FY24, Vicinity commenced work to
understand our interface with nature
and the material dependencies of our
operations and value chain, as well as
establish a biodiversity baseline and
measurement methodology.
Over the next three years we will adopt
an urban corporate natural capital
accounting approach to develop natural
capital accounts across all our centres.
This work will inform initiatives across
our operations and developments
to enhance biodiversity, improve
asset resilience, enhance community
experiences, and inform disclosures in
line with the Taskforce on Nature-related
Financial Disclosures.
tenancies at 31 centres,
with nine more projects to
be delivered in FY25
1,300
Smart water meters
installed across
Chadstone, VIC
41
Sustainability assurance
Securityholders
Directory
Communities
Suppliers
Risks
Governance
Tax
Financial report
Climate and environment
Our climate and environmental initiatives
Performance
Metrics
Unit of measure
FY24
vs FY23
(prior year)
vs FY16
(base year)
Net Zero 2030 Target portfolio
Energy
Total energy consumption
GJ
220,055
+2%
(18%)
Energy intensity
MJ/sqm
248
+3%
(18%)
Emissions
Total Scope 1 GHG emissions1
tCO2-e
1,547
+58%
(36%)
Total Scope 2 GHG emissions
tCO2-e
37,670
(3%)
(38%)
Total Scope 1 and Scope 2 GHG emissions
tCO2-e
39,217
(1%)
(38%)
Carbon intensity: Scope 1 and Scope 2 GHG
kg CO2-e/sqm
44
(0.3%)
(38%)
Managed portfolio
Energy
Total energy consumption
GJ
665,711
(3%)
(4%)
Energy intensity – managed portfolio
MJ/sqm
281
(2%)
(12%)
Renewable energy
Renewable energy consumption
MWh
40,429
+3%
NA
Renewable energy generation
MWh
43,487
+1%
NA
Emissions
Total Scope 1 GHG emissions
tCO2-e
5,294
(22%)
(8%)
Total Scope 2 GHG emissions
tCO2-e
112,906
(2%)
(30%)
Total Scope 1 and Scope 2 GHG emissions
tCO2-e
118,200
(3%)
(29%)
Total Scope 3 GHG emissions2
tCO2-e
217,014
(4%)
NA
Carbon intensity: Scope 1 and Scope 2 GHG
kg CO2-e/sqm
50
(2%)
(35%)
Water
Total water consumption
KL
2,217,175
0.5%
(2%)
Materials
Waste diversion rate
(% recycled)
52%
+1pp
+17pp
Total of waste (landfill and recycled)
tonnes
45,306
(2%)
+8%
Portfolio benchmarks
Green Star Performance
Portfolio
4 Star
—
NA
NABERS3 Energy rating
(portfolio average)
4.5 Star
(0.1 Star)
NA
NABERS3 Water rating
(portfolio average)
3.7 Star
(0.2 Star)
NA
We restate our historical data annually to reflect changes in the portfolio, i.e. divestments and acquisitions, with assets divested in the
reporting period reported as part of the managed portfolio. Any assets in the wholly-owned portfolio that are acquired or divested in
the reporting period are added and removed respectively from historical and current reportable data.
1. Increase is due to a higher than usual number of heating, ventilation and air conditioning systems requiring regassing as part of routine maintenance in FY24.
2. Includes Vicinity's tenants on our embedded network only.
3. NABERS Sustainable Portfolio Index 2024, based on Vicinity's ownership interest and ratings as at 31 December 2023, with 96% portfolio coverage.
People
Chairman/CEO letter
Highlights
Operating and financial review
Sustainability
Customers
Vicinity Centres | 2024 Annual Report
42
Introduction
Net Zero 2030 Target
During FY24, we continued our efforts
against our Net Zero 2030 Target set
during 2019, with both energy intensity
increasing 3% and emissions (Scope 1 and
Scope 2) intensity falling marginally.
Our Net Zero 2030 Target covers the
Scope 1 and Scope 2 carbon emissions
from the common mall areas of Vicinity’s
28 wholly‑owned centres – that is, the
emissions within our operational control
at these assets. This target aligns to
Australia’s commitments under the Paris
Agreement (United Nations Framework
Convention on Climate Change) and
is supported through the $73 million
investment in onsite solar generation
committed to in FY18.
Managed portfolio
Energy use
Electricity use remained stable across
the managed portfolio in FY24,
increasing 3% on FY23; and natural gas
use recorded decreased significantly
(by 31%). As a result, total energy
consumption and energy intensity
decreased by 3% and 2% from FY23.
Both total energy use and energy
intensity also maintained a downward
trajectory on the 2016 baseline,
reducing by 4% and 12% respectively.
As a business we measure and report on
Scope 1, Scope 2, and Scope 3 emissions
from energy, waste, water and tenants1.
During the year we saw a decrease of
3% in Scope 1 and Scope 2 emissions,
driven by a significant reduction in the
carbon intensity of the national grid,
specifically in Victoria and New South
Wales, where a large portion of our
portfolio is located.
Water use
Water use intensity increased by 1% in
FY24 from FY23.
However, proactive water use
management has resulted in water use
intensity reducing by 10% since the FY16
baseline, and absolute water use also
remains 2% below the baseline year.
Materials
Total waste generation has decreased
by 2% from FY23 to FY24, as a result
of improved waste management across
our centres.
Our proportion of materials diverted from
landfill increased by 1 percentage point
from 51% in FY23 to 52% in FY24.
1. Includes Vicinity’s tenants on
our embedded network only.
Reduction in natural gas
usage in FY24
-31%
Reduction in total waste
generation in FY24
-2%
Emporium Melbourne, VIC
43
Sustainability assurance
Securityholders
Directory
Communities
Suppliers
Risks
Governance
Tax
Financial report
Climate and environment
Our climate and environmental initiatives
Case Study: ENERGY
EFFICIENCY IN HERITAGE
SETTINGS
It is a complex task to find ways
to drive cost effective energy
efficiency in old buildings, especially
when they are heritage listed.
Queen Victoria Building (QVB), the
heritage listed gem in the heart of
the Sydney CBD, is one such case.
The QVB has some old
and inefficient heating and
cooling equipment and it was
determined that the Synchronous
Reluctance Motor (SynRM) would
be an ideal replacement.
The QVB project performed
better than anticipated, reducing
electricity use by 10.5 MWh,
maximum demand by 9%, and
emission by 8.3 tonnes CO2-e over
12 months. In addition, the project
electricity costs will be reduced
leading to a two year payback for
the project instead of the originally
expected four years.
With these results, the National
Capital Planning and Delivery team
will identify other centres where
SynRM can be installed.
Queen Victoria Building, NSW
People
Chairman/CEO letter
Highlights
Operating and financial review
Sustainability
Customers
Vicinity Centres | 2024 Annual Report
44
Introduction
Case Study: DRIVING
DIVERSION
Optimisation, education, and
collaboration are key in improving
and maintaining sustainable
practice. The Bankstown Central
team has embraced this to drive
improvements in diversion at the
centre over the last 24 months.
The team reviewed how each of
its loading docks was being used
and realigned with the tenant mix
to increase retailer convenience,
without compromising service (i.e.
same number of waste compactors
but at different locations).
— March 2023: Ranked 34/57 with
a diversion rate of 49%
— March 2024: Ranked 21/57 with
a diversion rate of 53%
For example, the general waste
(GW) compactor was removed
from Dock 2 and replaced with a
cardboard compactor to match the
waste produced by surrounding
fashion shops, which generate a
significant amount of cardboard.
Additionally, the GW capacity
was increased at Dock 1 with two
GW smart compactors installed,
replacing the single GW packer.
This change saved almost 70% of
the permanent dock cleaner’s time,
allowing for better monitoring and
helping retailers use the correct
waste stream, thereby improving
overall diversion rates in the centre.
This has resulted in a significant
uplift in diversion from 46% in
FY23 to 54% in FY24.
45
Sustainability assurance
Securityholders
Directory
Communities
Suppliers
Risks
Governance
Tax
Financial report
Climate and environment
Our risks and risk management
Identifying and managing risks is essential in supporting the achievement of Vicinity’s
strategy and objectives.
— Vicinity adopts a structured approach to managing risk to help provide benefits to its stakeholders, including securityholders,
employees, consumers, retailers and the communities in which Vicinity operates.
— Vicinity’s risk management approach facilitates the identification, assessment and management of risks to its operations and strategy,
ensuring a clear understanding of risks and enabling informed decision-making in line with the business strategy and risk appetite.
— The table below outlines the key risks that may affect Vicinity’s ability to create value over the short, medium and long-term; their
potential impacts and how Vicinity is managing them.
How we create value – page 14
Our strategy – page 10
Risks
How Vicinity manages the risks
Our associated resources
Economic conditions and rapidly evolving markets
Adverse economic conditions, a
subdued retail market, structural
changes in the industry including online
retail penetration, changing customer
preferences and disruptive innovations
may restrict growth opportunities and
impact Vicinity’s ability to compete
appropriately without changes to its
strategy and/or business model.
— Execution of its long-term strategy, which is focused on
enhancing its investment portfolio through selective acquisition
activity and disposal of less strategic assets, third party capital
business and advancing its retail and mixed-use development
pipeline to enhance and diversify portfolio composition.
— Strong asset management approach, focusing on optimising
leasing outcomes and tenant relationships, enhancing
consumer experience and improving asset efficiency.
— Proactive engagement with strongly performing retailers to
expand their presence across the portfolio and introduction
of new retail concepts and non-retail uses to drive greater
consumer visitation.
— ‘Retailer First’ approach to support retailers with tools and
information to enable their channel strategies.
— Driving growth in ancillary income streams through the
commercialisation of both retailer and consumer demand for
value adding products and services.
— Use of financial modelling to assess Vicinity’s short-term
income resilience to softening market conditions.
— Monitoring of retailer health, including sales performance
and rental payments.
— Individual asset Vision, Strategy and Action Plans for each
centre, which are reviewed and updated annually.
OUR REAL
ESTATE ASSETS
INVESTOR
CAPITAL
OUR
CUSTOMERS
Chadstone, VIC
Sustainability Supplement
People
Chairman/CEO letter
Highlights
Operating and financial review
Sustainability
Customers
Vicinity Centres | 2024 Annual Report
46
Introduction
Risks
How Vicinity manages the risks
Our associated resources
Protecting and enhancing our investment portfolio
Failure to identify or successfully
execute on acquisition, divestment
or development opportunities in line
with Vicinity’s portfolio strategy and
investment objectives.
— Clear investment criteria are utilised to evaluate the
prospective performance of existing portfolio assets.
— Actively monitor, identify and pursue selective acquisition
opportunities, underpinned by a disciplined process, including
comprehensive due diligence requirements.
— Development opportunities are assessed and prioritised against
set criteria, including meeting minimum risk-adjusted financial
return hurdles and sensitivity testing of key assumptions.
— The Investment and Capital Committee and Board provide
strong governance over and approval processes for capital
allocation decisions.
OUR REAL
ESTATE ASSETS
INVESTOR
CAPITAL
Funding
Failure to execute Vicinity's funding
and capital management strategy could
result in the inability to access funding
or capital at the appropriate price and
in the required timeframes.
— Maintaining strong investment grade credit ratings and a robust
capital structure with low gearing and significant liquidity to
manage upcoming debt expiries and capital movements, and to
facilitate access to markets.
— Monitoring asset valuations, rent collection, drawn debt, cost
of capital and compliance with financial covenants.
— Diversified funding sources.
— Maintenance of an appropriate weighted average drawn debt
maturity, with well-staggered expiries.
— Treasury risk management policies are in place and are
regularly reviewed.
— Management of interest rate movements and foreign exchange
exposures by the use of hedging.
— Strong oversight of balance sheet management and investment
decisions through the Investment and Capital Committee.
INVESTOR
CAPITAL
Development delivery
Inflationary pressures, supply chain
disruption, industrial relations
issues, contractor capability and
regulatory complexities could impact
Vicinity's ability to deliver approved
development projects.
— Early market engagement to understand capacity and capability
of external resources.
— Pre-project asset due diligence to identify existing asset
conditions and performance of existing structures and services.
— Specialised and experienced team members dedicated to the
delivery of development projects.
— Oversight of live and new development projects via the
Development Steering Committee.
— Procurement strategy for each development project.
— Health, Safety and Wellbeing Management System supported
by levels of awareness, competency, capability, culture, system,
processes and audit programs.
OUR REAL
ESTATE ASSETS
47
Sustainability assurance
Securityholders
Directory
Communities
Suppliers
Climate and environment
Governance
Tax
Financial report
Risks
Our risks and risk management
Risks
How Vicinity manages the risks
Our associated resources
Adoption of data analytics and technological advancements
The inability to adapt and adopt
technological advancements and
adequately utilise data analytics
and 'big data' to achieve market
intelligence may significantly affect
Vicinity’s ability to unlock its strategic
and operational potential or impact
Vicinity’s competitiveness.
— Dedicated in-house Data and Insights team who actively
explore, invest in and manage new products, services and
data assets that are complementary to and leverage Vicinity's
retail portfolio.
— Leveraging data and digital assets to enable data-driven
analysis and decision making. This includes optimising leasing
decisions, providing retailer insights, informing development
decisions and improving operational performance.
OUR REAL
ESTATE ASSETS
INVESTOR
CAPITAL
OUR
CUSTOMERS
Information/data security
A cyber attack, theft or other
malicious or accidental act (from
internal or external sources) could
result in a data breach, reputational
damage and impact to operations.
— Robust Information Security and Data Governance and
Management Systems including tools, training, systems and
processes to address data collection, use and management
(Data Governance) and protection (Information Security).
— Oversight of the development and implementation of
information security policies, systems, processes and training
within the Management System by the Cyber and Data
Governance Committee.
— Dedicated in-house Cyber and Data Governance team.
— ISO 27001 Certification and alignment to the National Institute
of Standards and Technology framework.
— Data breach, cyber security incident and disaster recovery
plans are in place and tested annually.
OUR COMMUNITY
RELATIONSHIPS
OUR REAL
ESTATE ASSETS
INVESTOR
CAPITAL
OUR
CUSTOMERS
People
Failure to support, develop, attract
and retain top talent may impact
business performance and Vicinity's
ability to achieve strategic objectives.
— People strategy focused on driving performance through
optimising the operating model and ways of working,
driving cultural change and building the future capability
of our leaders and team members to deliver increased
commercial performance.
— Succession planning for key roles including Executive and
Senior Leader roles.
— A range of leadership, and learning and development
programs are in place to build capability, create succession and
retain talent.
— Fit for purpose remuneration, benefits, reward and
recognition frameworks.
OUR
PEOPLE
Conduct and culture
A failure to promote a healthy culture,
including where employees feel able
to speak up, could adversely impact
business performance and reputation.
— Code of Conduct and supporting policies set clear behavioural
standards and ethical expectations.
— Encouraging an inclusive workplace where diversity is valued
and leveraged as a driver of a performance culture.
— Team members are assessed against the values and behavioural
standards outlined in the Code of Conduct as part of the
annual performance review process.
— Revitalising Vicinity’s Purpose, Vision and Values.
— Employee Experience and Workplace Psychological Safety
Index surveys and focus groups to assess culture, engagement,
and identify areas of opportunity.
OUR
PEOPLE
People
Chairman/CEO letter
Highlights
Operating and financial review
Sustainability
Customers
Vicinity Centres | 2024 Annual Report
48
Introduction
Risks
How Vicinity manages the risks
Our associated resources
Climate change
Failure to identify, evaluate and respond
to climate-related risks may impact
Vicinity’s ability to meet regulatory
obligations and stakeholder expectations,
ensure the ongoing resilience of our
centres and may result in increased costs.
— Implementation of a climate change management framework
aligned to the guidelines of the Taskforce for Climate-related
Financial Disclosures. This framework outlines Vicinity’s
approach to identifying and managing climate-related risks
and opportunities across a number of climate scenarios and
time horizons.
— Development of mitigation and adaptation strategies to
manage its climate-related risks, including energy efficiency
and renewable energy initiatives, infrastructure upgrades
and business continuity planning.
— Net Zero 2030 Target for the common mall areas of our
wholly‑owned centres.
— Refreshed climate risk review assessments at an asset level,
including a detailed centre by centre review of climate
exposures, risk levels and potential mitigation strategies, based
on 2030 and 2050 climate change scenario assessments.
OUR
ENVIRONMENT
OUR REAL
ESTATE ASSETS
INVESTOR
CAPITAL
OUR COMMUNITY
RELATIONSHIPS
Health and safety
Vicinity’s operations expose team
members, contractors, retailers and
consumers to the risk of injury or illness.
— Health, Safety, Environment and Wellness System supported
by levels of awareness, competency, capability, culture, system,
processes and audit programs.
— Provision of proactive mental health and wellbeing support
and resources.
— Training and education to equip team members with skills
to identify and appropriately respond to mental health and
wellbeing issues.
OUR
CUSTOMERS
OUR
PEOPLE
OUR COMMUNITY
RELATIONSHIPS
Security and intelligence
An act of high impact civil disturbance,
terror, active armed offender or other
hostile aggressor activity would have
significant consequences on shopping
centre safety impacting retailer, customer
and team member welfare, sales, rental
and brand.
— Maintaining strong relationships with police, agencies and
peers to build intelligence and response capability.
— Adherence to the recommendations from the Australian
Government’s Crowded Places Strategy across all centres.
— Emergency response plans are in place for all assets.
— Ongoing review of asset hardening measures are incorporated
in all centres, future developments and refurbishments.
— Crisis and Emergency Management System, which provides the
framework for Vicinity to respond to a major incident or crisis.
— Regular training and exercises to equip team members with the
skills and tools, guidelines and procedures to manage an actual
or potential crisis irrespective of the type of incident.
OUR REAL
ESTATE ASSETS
OUR
CUSTOMERS
OUR COMMUNITY
RELATIONSHIPS
Regulatory changes and Government relations
Failure to comply with and respond to
changes in the regulatory environment
could result in restricting business
opportunities, financial penalties,
legal liabilities and damage to
Vicinity's reputation.
Potential changes to government
regulations, coupled with ineffective
government engagement, could lead
to adverse impacts on Vicinity’s ability
to meet its strategic objectives and
maintain financial stability.
— Active engagement with Government on policy areas and
reform to gain insights into policy changes under consideration.
— Direct consultation with all levels of Government, and input
provided to regulatory consultation processes via law firms and
peak industry bodies.
— Application of a consistent, centralised approach for identifying,
assessing and managing regulatory changes through legislative
and regulatory monitoring tools and engagement with
industry associations.
INVESTOR
CAPITAL
OUR COMMUNITY
RELATIONSHIPS
49
Sustainability assurance
Securityholders
Directory
Communities
Suppliers
Climate and environment
Governance
Tax
Financial report
Risks
Governance
Our Board
Our Board is committed to high
standards of corporate governance.
Our corporate governance platform is
integral to supporting our strategy,
protecting the rights of our
securityholders and creating
sustainable growth.
Corporate Governance
During FY24, our corporate
governance framework was consistent
with the 4th edition of the ASX
Corporate Governance Council’s
Corporate Governance Principles and
Recommendations. Our 2024 Corporate
Governance Statement is available in
the Corporate Governance section of
our website.
Company Secretaries
Vicinity has two Company Secretaries:
Carolyn Reynolds
Refer to page 56 for biographical details.
Rohan Abeyewardene
Rohan Abeyewardene was appointed
Group Company Secretary in October
2018 following his appointment as
Company Secretary in February 2018.
Prior to this, Mr Abeyewardene held
a range of company secretarial and
governance roles. Mr Abeyewardene is
a Fellow of the Governance Institute of
Australia and a Chartered Accountant.
Further information
You can find more disclosure on the
following topics:
2024 Corporate Governance Statement
Our strategy – page 10
Our risks and risk management – page 46
Tax transparency – page 58
Corporate directory – page 151
Trevor Gerber
BACC, CA, SA
Independent Non-executive Chairman
Appointed June 2015
Mr Gerber worked for 14 years at Westfield,
initially as Group Treasurer and subsequently
as Director of Funds Management responsible
for Westfield Trust and Westfield America
Trust. He has been a professional Director
since 2000, and has experience in property,
funds management, hotels and tourism,
infrastructure and aquaculture.
Mr Gerber is the Chairman of the
Nominations Committee.
Mr Gerber was elected as Vicinity’s Chairman
effective from the conclusion of the 2019
Annual General Meeting.
Current Listed Directorships
Nil.
Past Listed Directorships (last three years)
Sydney Airport (Chairman from 2015 to 2021
and Director from 2002).
Peter Huddle
BSC ECON
Chief Executive Officer and Managing Director
Appointed February 2023
Mr Huddle joined Vicinity Centres in March
2019 as Chief Operating Officer (COO) before
being appointed as Chief Executive Officer
and Managing Director in February 2023.
Prior to joining Vicinity, Peter has had
extensive experience in multiple global
markets through a number of senior roles
within the Westfield Group. Peter was most
recently COO of Unibail-Rodamco-Westfield,
USA post-acquisition of Westfield. Before
the acquisition, Peter was Senior Executive
Vice President and Co-Country Head of the
USA, where he led the US Development
teams through a prolific period of expansion.
Before the US, he was COO of a Westfield
Joint Venture in Brazil. Previous to Brazil,
Peter had extensive Asset Management
and Development experience within the
Australian market.
Peter has over 25 years’ experience in
Real Estate Development and Asset
Management and is a graduate of the Stanford
Executive Program.
Peter is Deputy Chair of the Shopping
Centre Council of Australia and a member of
Champions of Change Property.
Current Listed Directorships
Nil.
Past Listed Directorships (last three years)
Nil.
Chadstone, VIC
People
Chairman/CEO letter
Highlights
Operating and financial review
Sustainability
Customers
Vicinity Centres | 2024 Annual Report
50
Introduction
Tiffany Fuller
BCOM, GAICD, ACA
Independent Non-executive Director
Appointed November 2022
Ms Fuller is an experienced public company
Non-executive Director with broad experience
in chartered accounting, corporate finance,
investment banking, private equity, funds
management and management consulting in
Australia and globally.
Ms Fuller is Chairman of the Audit Committee
and a member of the Risk, Compliance
and ESG Committee.
Ms Fuller currently serves on the Boards of
Computershare Limited, Washington H. Soul
Pattinson Limited, Australian Venue Co and
Royal Children’s Hospital Foundation.
Ms Fuller’s skills include finance and
accounting, strategy, M&A, risk management
and governance. Her career includes roles at
Arthur Andersen and Rothschild and spans
multiple industry sectors including retail,
financial services, technology, resources
and infrastructure.
Current Listed Directorships
Computershare Limited (since 2014) and
Washington H. Soul Pattinson Limited
(since 2017).
Past Listed Directorships (last three years)
Nil.
Tim Hammon
BCOM, LLB, MAICD
Independent Non-executive Director
Appointed December 2011
Mr Hammon has extensive wealth
management, property services and
legal experience.
Mr Hammon was previously Chief Executive
Officer of Mutual Trust Pty Limited and
worked for Coles Myer Ltd reporting to the
Chief Executive Officer in a range of senior
executive roles including Chief Officer,
Corporate and Property Services with
responsibility for property and corporate
strategy. He was also Managing Partner of
various offices of the law firm previously
known as Mallesons Stephen Jaques.
Mr Hammon is the Chairman of the
Risk, Compliance and ESG Committee
and a member of the Remuneration and
Human Resources Committee and the
Nominations Committee.
Mr Hammon is also the Chairman and a
member, respectively, of the advisory boards
of the Pacific Group of Companies and of
Liuzzi Property Group, a Director of EQT
Holdings Limited and an advisor to EMT
Partners Pty Ltd.
Current Listed Directorships
EQT Holdings Limited (since 2018).
Past Listed Directorships (last three years)
Nil.
Clive Appleton
BEC, MBA, AMP (HARVARD), GRADDIP
(MKTG), FAICD
Non-executive Director
Appointed September 2018
Mr Appleton has extensive experience in
property and funds management and property
development, having worked for several of
Australia’s leading retail property investment,
management and development groups.
Mr Appleton’s executive experience includes
Chief Executive Officer of Gandel Retail Trust
and various senior executive positions with
Jennings Group, where he was responsible
for managing and developing its retail assets
before a subsidiary was restructured to
become Centro Properties Limited, of which
he became Managing Director. Mr Appleton
also held roles as Managing Director of
The Gandel Group Pty Limited where he was
involved in the development of $1 billion
worth of property and Managing Director
of APN Property Group, including being
instrumental in its float and responsible for
managing its Private Funds division.
Mr Appleton was also previously a Non-
executive Director of Federation Centres and
the RE from December 2011 to the time of
the merger with Novion Property Group in
June 2015.
Mr Appleton is currently Chairman of Aspen
Group and Pancare Foundation, Deputy
Chairman of The Gandel Group Pty Limited,
and a Director of Perth Airport Pty Ltd and
Perth Airport Development Group Pty Ltd.
Current Listed Directorships
Aspen Group (Chairman since 2012).
Past Listed Directorships (last three years)
APN Property Group Limited (from 2004
to 2021).
51
Sustainability assurance
Securityholders
Directory
Communities
Suppliers
Climate and environment
Risks
Tax
Financial report
Governance
Governance
Peter Kahan
BCOM, BACC, CA, MAICD
Independent Non-executive Director
Appointed June 2015
Mr Kahan has had a long career in property
funds management, with prior roles including
Executive Deputy Chairman, Chief Executive
Officer and Finance Director of The Gandel
Group. Mr Kahan was the Finance Director of
The Gandel Group at the time of the merger
between Gandel Retail Trust and Colonial
First State Retail Property Trust in 2002.
Prior to joining The Gandel Group, Mr Kahan
worked as a Chartered Accountant and held
several senior financial roles across a variety of
industry sectors.
Mr Kahan is Chairman of the Remuneration
and Human Resources Committee and a
member of the Audit Committee and the
Nominations Committee.
Mr Kahan’s skills include strategy, property
funds management, finance, mergers
and acquisitions, investment, leadership
and governance.
Mr Kahan has previously been a Director of
Charter Hall Group and Dexus Wholesale
Property Limited and the Chairman of the
Advisory Board of Quintessential Equity.
Current Listed Directorships
Nil.
Past Listed Directorships (last three years)
Nil.
Janette Kendall
BBUS MARKETING, FAICD
Independent Non-executive Director
Appointed December 2017
Ms Kendall has significant expertise in
strategic planning, digital innovation,
marketing, operations and leadership across
a number of industry sectors including
digital and technology, marketing and
communications, media, retail, fast-moving
consumer goods, hospitality, gaming,
property and manufacturing.
Ms Kendall’s executive experience, both
in Australia and China, includes Senior
Vice President of Marketing at Galaxy
Entertainment Group, China, Executive
General Manager of Marketing at Crown
Resorts, General Manager and Divisional
Manager roles at Pacific Brands, Executive
Director at Singleton Ogilvy & Mather, CEO
of emitch Limited, and Executive Director
of Clemenger BBDO.
Ms Kendall is a member of the Remuneration
and Human Resources Committee and the
Risk, Compliance and ESG Committee.
Ms Kendall is also a Director of Tabcorp
Holdings Limited, Melbourne Football
Club, KM Property Funds, and Visit Victoria
and Melbourne Convention Bureau (a
subsidiary of Visit Victoria).
Current Listed Directorships
Tabcorp Holdings Limited (since 2021).
Past Listed Directorships (last three years)
Costa Group (from 2016 to 2024).
Michael Hawker AM
BSC, FAICD, SF FIN, FLOD
Independent Non-executive Director
Appointed November 2022
Mr Hawker has substantial corporate
experience, with over 35 years in the financial
services industry, including as CEO and
Managing Director of Insurance Australia
Group from 2001 to 2008. Prior to this, he
held senior positions at Westpac Banking
Corporation, and with Citibank in Australia
and Europe. Mr Hawker also brings a deep
understanding of risk management and
a global perspective gained through his
overseas experience.
Mr Hawker is a member of the Audit
Committee and the Risk, Compliance
and ESG Committee.
Mr Hawker currently serves on the Boards of
Washington H. Soul Pattinson Limited, Allianz
Australia, BUPA Global, BUPA Australia, and
the Museum of Contemporary Art.
Mr Hawker was previously a Director of
Westpac Banking Corporation, Macquarie
Group Limited and Macquarie Bank Limited,
and Aviva plc.
Mr Hawker was also President of the
Insurance Council of Australia, Chairman of
the Australian Financial Markets Association,
a Board member of the Geneva Association
and a member of the Financial Sector
Advisory Council.
Mr Hawker was made a Member of the Order
of Australia for services to the community
in 2010.
Current Listed Directorships
Washington H. Soul Pattinson Limited
(since 2012).
Past Listed Directorships (last three years)
Westpac Banking Corporation (from 2020
to 2023) and Altium Limited (from 2023
to 2024).
People
Chairman/CEO letter
Highlights
Operating and financial review
Sustainability
Customers
Vicinity Centres | 2024 Annual Report
52
Introduction
Georgina Lynch
BA, LLB
Independent Non-executive Director
Appointed November 2022
Ms Lynch has 30 years combined executive
and board experience in the property and
financial services sectors, including significant
experience across all classes of property and
in corporate transactions, capital raisings,
initial public offerings, funds management,
corporate strategy, and acquisitions
and divestments.
Ms Lynch is currently the Chair of Cbus
Property, the wholly-owned subsidiary
of Cbus. Cbus Property has a significant
portfolio of investments and developments
in the commercial, retail and residential
property sectors.
Ms Lynch is a member of the Audit
Committee and the Remuneration and
Human Resources Committee.
Ms Lynch is Chair of Waypoint REIT, and
Chair of the Waypoint REIT Nominations
Committee, and Non-executive Director of
Evolve Housing and member of the Evolve
Housing Audit and Risk Committee.
Current Listed Directorships
Waypoint REIT (Chair since 2024 and Director
since 2016).
Past Listed Directorships (last three years)
Tassal Group (from 2018 to 2022) and
Irongate Group (from 2019 to 2022).
Dion Werbeloff
BCOM (HONS), MBA (DISTINCTION), MAICD
Non-executive Director
Appointed November 2022
Mr Werbeloff has more than 30 years’
experience in property and investment
banking, including funds management,
property development, corporate
strategy, corporate finance and mergers
and acquisitions.
Mr Werbeloff has been CEO and a Director
of The Gandel Group for the past five years,
having previously held the role of Chief
Operating Officer for five years. Prior to
joining The Gandel Group, Mr Werbeloff had
an extensive career in investment banking,
most recently as a Managing Director at
Goldman Sachs and Chief Operating Officer of
Goldman Sachs’ investment banking business
in Australia and New Zealand.
Mr Werbeloff is a member of the Risk,
Compliance and ESG Committee.
Mr Werbeloff is also a Director of
JDRF Australia.
Current Listed Directorships
Nil.
Past Listed Directorships (last three years)
Nil.
The Strand Arcade, NSW
53
Sustainability assurance
Securityholders
Directory
Communities
Suppliers
Climate and environment
Risks
Tax
Financial report
Governance
Executive Leadership Team
Our Chief Executive Officer and
Managing Director (CEO), together
with the members of our Executive
Leadership Team (ELT) and senior
leaders, are responsible for implementing
Vicinity’s strategy, achieving Vicinity’s
business objectives and carrying out the
day to day management of Vicinity.
Management is also responsible for
providing our Board with accurate,
timely and transparent information
to enable the Board to perform
its responsibilities.
Management committees
Our CEO has established management
committees to facilitate decision making
by management as outlined below:
— Executive Leadership Team –
comprises eight members outlined on
the current page and overleaf
— Capital Management Committee –
comprises the CEO, Chief Financial
Officer (CFO), and General Manager
Treasury, with the CEO or CFO to act
as a Committee Chairman
— Investment and Capital Committee –
comprises the CFO (Committee
Chairman), CEO, Chief Legal,
Risk & ESG Officer, and Director
Funds Management
Peter Huddle
Chief Executive Officer and
Managing Director
Mr Huddle joined Vicinity Centres in March
2019 as Chief Operating Officer (COO) before
being appointed as Chief Executive Officer
and Managing Director in February 2023.
Prior to joining Vicinity, Peter has had
extensive experience in multiple global
markets through a number of senior roles
within the Westfield Group. Peter was most
recently COO of Unibail-Rodamco-Westfield,
USA post-acquisition of Westfield. Before
the acquisition, Peter was Senior Executive
Vice President and Co-Country Head of the
USA, where he led the US Development
teams through a prolific period of expansion.
Before the US, he was COO of a Westfield
Joint Venture in Brazil. Previous to Brazil,
Peter had extensive Asset Management
and Development experience within the
Australian market.
Peter has over 25 years’ experience in
Real Estate Development and Asset
Management and is a graduate of the
Stanford Executive Program.
Peter is Deputy Chair of the Shopping
Centre Council of Australia and a member
of Champions of Change Property.
Adrian Chye
Chief Financial Officer
Adrian Chye joined Vicinity Centres in June
2015 following the merger of Federation
Centres and Novion Property Group
(Novion), before being appointed as CFO in
September 2021.
In Adrian’s role as CFO, he is responsible
for the finance, technology and strategy
functions. Adrian’s responsibilities include
financial planning and analysis, reporting, tax,
treasury, group strategy, investor relations,
mergers and acquisitions, core technology
and cyber and information security.
Prior to his current appointment, Adrian was
Director, Strategy and Corporate Finance.
Previous to this, Adrian was Head of Strategy
at Novion (formerly CFSGAM Property) and
Head of Strategy and Corporate Transactions
at CFSGAM Property.
Adrian is an experienced finance executive
with over 20 years’ experience in strategy,
corporate finance and accounting roles and is
a Member of Chartered Accountants Australia
and New Zealand.
Governance
People
Chairman/CEO letter
Highlights
Operating and financial review
Sustainability
Customers
Vicinity Centres | 2024 Annual Report
54
Introduction
David McNamara
Director Funds Management
David McNamara joined Vicinity Centres in
February 2022.
In David’s role as Director Funds Management,
he is responsible for Funds Management
initiatives for Vicinity. This includes working
alongside Joint Venture partners to ensure
alignment at a partnership level.
Prior to joining Vicinity, David held senior
roles with Lendlease including, Head of
Asset Management – Retail, as well as Fund
Manager of the Australian Prime Property
Fund Retail. Previous to this he worked
for The GPT Group, with roles including
Capital Transactions and Head of Asset
Management – USA.
Before joining GPT, David gained extensive
Asset Management, Leasing and Development
experience working on major retail assets
around Australia. David has over 30 years’
experience in the retail sector in Funds and
Asset Management.
Chatswood Chase, NSW
Kirrily Lord
Group Director, Customer
& Asset Management
Kirrily Lord joined Vicinity Centres in
July 2021.
Kirrily has overall accountability for the
customer experience of Vicinity’s consumers,
retailers and Joint Venture partners, as well as
the Asset Manager functions of our portfolio.
This includes the performance of the centres’
management teams who govern all areas of
the consumer experience, centre operations
as well as the allocation of capital and
operational expenditure across the portfolio.
She also has carriage of several business
enablement functions, including Vicinity’s
Brand and Marketing teams, the Data,
Digital and Innovation teams, the enterprise
Procurement function, and our Stakeholder
Communications team.
Prior to this appointment, Kirrily was the
Director of Property Management at Vicinity.
Before joining Vicinity, she was General
Manager of Retirement Living and Head
of Asset Management within Stockland.
Kirrily has also held Senior Development
Management as well as Asset and Centre
Management roles with a specialist focus on
retail and mixed-use.
Kirrily has over 25 years’ experience in the
property industry and has held senior roles
across all functions of the sector, including
at Stockland, Westfield, AMP and Myer.
Matt Parker
Group Director, Leasing
Matt Parker joined Vicinity Centres in
November 2017 as General Manager of
Leasing (VIC/WA/SA/TAS) before being
appointed as the Director of Leasing in
October 2021.
In Matt’s current role, he is responsible
for the management of the Leasing, Mall
Leasing, Vacant Shop Income, and Design
and Delivery teams.
Matt has had extensive experience over the
last 25 years working for multiple retailers
and landlords within various management and
property functions. Prior to joining Vicinity,
Matt was the Joint General Manager at Uniqlo
Australia where he worked for five years.
Previous to this, he held senior positions
within the Leasing Team at Queensland
Investment Corporation for over 10 years,
including General Manager of Leasing,
Regional Leasing Manager and Project
Leasing Manager.
55
Sustainability assurance
Securityholders
Directory
Communities
Suppliers
Climate and environment
Risks
Tax
Financial report
Governance
Governance
Tanya Southey
Chief People & Organisational
Development Officer
Tanya Southey joined Vicinity Centres in
October 2019.
Prior to joining Vicinity, Tanya held Executive
Human Resources roles at General Electric,
Jetstar and Carlton and United Breweries
(CUB). In addition, Tanya has consulted within
the Human Resources strategy space.
During her career, Tanya has been involved in
major cultural transformations, including due
diligences, acquisitions, building employee
value propositions and creating high
performance cultures. In her time at CUB,
Tanya was involved in the global transaction
to sell SABMiller to AB Inbev, a US$106 billion
deal which was the largest in the history of
the London Stock Exchange at that time.
Tanya has worked in the United States, South
Africa and Australia and has been accountable
for Human Resources teams across the Asia-
Pacific in multiple roles.
Tanya has more than 25 years’ experience
in Human Resources and has been on the
Victorian Board for The Hunger Project, a
global organisation which aims to end world
hunger through the empowerment of people
in developing countries.
QueensPlaza, NSW
Jeheon Son
Group Director, Development
& Government Relations
Jeheon Son joined Vicinity in July 2023 as
Group Director, Development & Government
Relations. Jeheon is responsible for leading
Vicinity’s development business and
government relations function.
Prior to joining Vicinity, Jeheon has had
extensive experience in the development and
delivery of large scale global mixed-use urban
renewal and retail developments, including the
urban renewal of the Liverpool UK city centre,
the development of the London 2012 Athletes
Village, and the construction of the Scottish
Parliament Building. Locally, Jeheon was
previously the Head of Development NSW
at Lendlease, led commercial development
new business at Mirvac and most recently
led Stockland’s newly formed mixed-use and
urban renewal business unit.
Jeheon has over 20 years’ experience
in development, construction delivery,
acquisitions, capital partnering, government
relations, design management, project
management and business unit leadership.
Carolyn Reynolds
Chief Legal, Risk & ESG Officer
Carolyn Reynolds joined Vicinity Centres
in May 2014 and has more than 25 years’
experience as a commercial litigation and
corporate lawyer.
In her current role, Carolyn has oversight
of the Health, Safety, Environment &
Wellbeing, Risk & Compliance, Company
Secretarial, Leasing Legal, Sustainability, and
Legal functions for Vicinity. Carolyn is also a
Director of the Vicinity subsidiary Boards.
Carolyn was previously a partner at law
firm Minter Ellison. She is a graduate and
a member of the Australian Institute of
Company Directors, and a member of Chief
Executive Women and ACC Australia.
People
Chairman/CEO letter
Highlights
Operating and financial review
Sustainability
Customers
Vicinity Centres | 2024 Annual Report
56
Introduction
The Strand Arcade, NSW
57
Sustainability assurance
Securityholders
Directory
Communities
Suppliers
Climate and environment
Risks
Tax
Financial report
Governance
Tax transparency
Vicinity drives sustainable growth from our portfolio of assets with a focus on enhancing
the communities in which we operate.
Underpinning our strategy is robust
corporate governance that upholds
integrity, accountability and transparency
across all of our business practices,
including our tax responsibilities.
Vicinity voluntarily publishes this
statement to our stakeholders as part of
our commitment to provide transparent
and useful information on our tax affairs.
Australian tax transparency
To improve the transparency of business
tax affairs in Australia, the Board of
Taxation designed the Tax Transparency
Code (TTC) to outline a set of principles
and minimum standards to guide the
disclosure of tax information. Vicinity
adopts the TTC recommendations in
this statement.
Our approach to tax
Vicinity has a Tax Risk Management
Framework (the Framework) that is
endorsed by the Audit Committee and
approved by the Board of Directors.
Vicinity adheres to the principles of the
Framework which affirms our low risk
approach to taxation and a philosophy
centred around integrity and transparency.
Under the Framework, Vicinity:
— Has a low risk appetite and does not
engage in aggressive tax planning
and strategies;
— Complies with its statutory obligations
in a timely and transparent manner and
further enhancing Vicinity’s reputation
as a responsible taxpayer;
— Has robust tax governance, with
ongoing oversight and escalation points
for managing tax risk from Vicinity’s key
executives to the Audit Committee and
Board of Directors;
— Has a commitment to engage with, and
maintain transparent and professional
relationships with, tax authorities
including the Australian Taxation Office
(ATO); and
— Has the Framework reviewed and
endorsed annually by the Audit
Committee to ensure it remains
effective and relevant.
Vicinity applies the Framework across
its business to integrate the assessment
of the tax implications of transactions,
projects and business initiatives, into
day‑to-day business. This enables us
to assess the tax implications of all
transactions before committing to them
and mitigate any tax risks that might arise.
A robust set of internal controls and
policies exists to support the operational
effectiveness of the Framework
within Vicinity. Furthermore, the Audit
Committee and assurance functions such
as internal and external audits provide
periodic independent and objective
assurance on the effectiveness of tax risk
management, control and governance
processes. In addition, our Whistleblower
Policy enables and encourages all
employees to report any potential
concerns regarding unlawful, unethical,
irresponsible or undesirable conduct
involving Vicinity.
Vicinity values having cooperative
and transparent relationships with
all stakeholders. We collaborate with
the ATO and other relevant external
regulatory bodies regarding our tax
compliance and proactively engage
on significant tax issues. In addition,
we contribute to several associations
including the Property Council of Australia
and Corporate Tax Association regarding
tax policy, tax reform and tax law design
on matters relevant to our business and
our securityholders.
Vicinity also regularly connects with
and encourages feedback from its
securityholders. We provide a number of
channels for securityholders to provide
feedback directly via phone, email,
the Annual General Meeting and the
management team regularly meets with its
largest investors.
Further information on Vicinity’s corporate
governance (including details on Vicinity’s
Whistleblower Policy) is available in its
2024 Corporate Governance Statement.
2024 Corporate Governance Statement
Vicinity’s group structure
Vicinity securities consist of one share in
the company (Vicinity Limited) and one
unit in the trust (Vicinity Centres Trust).
The shares and units are stapled together
as Vicinity Centres securities listed on
the ASX (ASX: VCX). However, Vicinity
Limited and Vicinity Centres Trust remain
separate legal entities in accordance with
the Corporations Act 2001 (Cth) and under
the tax law.
Vicinity Limited, and its controlled
entities, undertakes the business of
managing Vicinity’s shopping centre
portfolio including property management,
development management and
responsible entity and trustee services for
Vicinity Centres Trust, its sub-trusts and
external wholesale fund. Vicinity Limited
also provides property and development
management services for joint owners of
Vicinity's assets and other third parties.
Vicinity Centres Trust is a managed
investment scheme operating in
accordance with the Corporations Act
2001 (Cth), and is regulated by the
Australian Securities and Investments
Commission. Vicinity Centres Trust and
its controlled trusts (Vicinity Centres Trust
Group) hold the majority of the Australian
real estate investments for Vicinity.
All of Vicinity’s real estate investments
are situated in Australia. Vicinity does
not have any offshore-domiciled related
parties and therefore this report does
not describe any international related
party dealings.
Taxation of Vicinity
For the purposes of financial reporting,
Vicinity Limited and Vicinity Centres
Trust prepare a consolidated financial
report. However, under tax law, Vicinity
Limited and Vicinity Centres Trust
are treated differently and require
separate consideration.
People
Chairman/CEO letter
Operating and financial review
Sustainability
Customers
Vicinity Centres | 2024 Annual Report
58
Highlights
Introduction
Vicinity Limited
Vicinity Limited and its controlled entities are consolidated for income tax purposes, resulting in all members of the consolidated group
being treated as a single corporate taxpayer under Vicinity Limited. Under Australian tax law, companies are subject to income tax at the
applicable corporate tax rate (30% for FY24) on their taxable income.
Vicinity Centres Trust Group
The Vicinity Centres Trust has elected into the Attribution Managed Investment Trust (AMIT) regime and is not liable to pay income tax
when it attributes all its taxable income to securityholders.
When the taxable income is attributed as income to its securityholders, Australian resident securityholders pay tax on this income at
their marginal tax rates and non-resident securityholders are taxed under the Managed Investment Trust withholding tax rules.
Contributions to the Australian tax system
As a business that operates in the Australian property industry, Vicinity is subject to taxes at the federal, state and local government
levels. In FY24, these taxes amounted to approximately $246.7 million and are either borne by Vicinity as a cost of doing business or
are remitted by Vicinity as part of our contribution to the administration of the Australian tax system1.
The taxes remitted by Vicinity include pay as you go (PAYG) withholding taxes paid by our employees and goods and services tax
(GST) collected from our retailers who rent space in our centres and other ancillary income, net of GST claimed by Vicinity on its
own purchases.
The information provided below summarises Vicinity’s Australian tax contribution for FY24.
Notes to charts
The notes below outline the basis of preparation of each of the taxes borne and taxes remitted. Vicinity’s Australian tax contributions have been verified by Vicinity’s
Finance and Internal Audit functions.
a. Landholder duty, land tax, local rates and levies data have been reported on an accrual basis and therefore may vary from the actual taxes paid in FY24 and FY23. The
increase in landholder duty in FY24 is due to the acquisition of the remaining 49% interest in Chatswood Chase and no acquisition in FY23.
b. Payroll tax, FBT, GST and PAYG withholding data has been reported based on the amounts paid in respect of tax returns or notices of assessment issued to Vicinity for
FY24 from the respective revenue authorities.
c. Net GST remitted for FY24 is comprised of $174.1 million of GST collected (FY23: $166.4 million) and $94.8 million of GST claimed (FY23: $90.7 million).
d. This represents taxes withheld from Vicinity’s securityholders, which has been prepared based on information maintained by Vicinity’s external security registry
provider. As the majority of our securityholders either supply their tax file number or in the case of non-residents, hold their interests indirectly, this figure is not
representative of the taxes actually paid by our securityholders.
1. In this regard, Vicinity includes entities which have been equity accounted in the Financial Report.
FY24
FY23
Total taxes borne by Vicinity ($m)
$108.6 million (FY23: $88.6 million)
Total taxes remitted by Vicinity ($m)
$138.1 million (FY23: $132.7 million)
41.9
41.6
36.3
35.4
Landholder duty(a)
0.0
5.0
10.0
15.0
20.0
30.0
35.0
40.0
25.0
45.0
Local rates and levies(a)
Land tax(a)
Payroll tax(b)
Fringe benefits tax(b)
17.7
0.0
12.3
11.1
0.4
0.5
79.3
75.7
0.0
10.0
20.0
30.0
40.0
60.0
70.0
80.0
50.0
90.0
58.0
56.3
0.8
0.7
Net GST remitted(b),(c)
PAYG withholding(b)
Taxes withheld
from investors(d)
Sustainability assurance
Securityholders
Directory
Communities
Suppliers
Climate and environment
Risks
Governance
Financial report
Tax
59
Tax transparency
Reconciliation of accounting profit to income tax paid and payable
A full reconciliation of Vicinity’s accounting net profit to income tax benefit is included in Note 3 to the Financial Report. Accounting
net profit is determined in accordance with the Australian Accounting Standards. Taxable income, in contrast, is an income tax concept,
which is calculated by subtracting allowable deductions from assessable income. A taxpayer's income tax liability is calculated by
multiplying its taxable income by its applicable tax rate.
Vicinity Limited
The FY24 reconciliation from income tax benefit to income tax paid or payable is outlined below:
In FY24, the Vicinity Limited consolidated group generated taxable income of approximately $14.4 million prior to the utilisation of tax
losses. After utilisation of carry-forward losses and imputation credits no income tax is payable.
The effective tax rate1 (ETR) based on current year income tax benefit for Vicinity Limited is 22.13%. The ETR is lower than the
corporate tax rate (currently 30%) predominately due to net adjustments relating to permanent differences. For further explanation, Note
3(b) to the Financial Report provides a reconciliation of prima facie income tax expense at 30% to the income tax benefit recognised.
Vicinity Centres Trust Group
The accounting net profit attributable to the securityholders of Vicinity Centres Trust Group was $557.3 million for FY24. Vicinity Centres
Trust has derived taxable income which will be attributed to the securityholders under the AMIT rules and taxed in the hands of
securityholders, as described above. As a result, it has no income tax expense and therefore a zero ETR.
($m)
Income tax benefit (refer to Note 3 to the Financial Report)
2.9
Adjust for:
Movement in deferred tax assets including the utilisation of Vicinity Limited Group tax losses
(2.8)
Adjustment of current tax for prior periods and other
(0.1)
Income tax payable
—
1. The ETR has been calculated as income tax benefit ($2.9 million) divided by net loss before tax attributable to Vicinity Limited ($13.1 million) (in accordance with
AASB 112 Income Taxes). The ETR should not be compared to the corporate tax rate without appreciating the differences between accounting profit and taxable
income (as explained above). Further information is available on the ATO's tax transparency webpage.
People
Chairman/CEO letter
Highlights
Operating and financial review
Sustainability
Customers
Vicinity Centres | 2024 Annual Report
60
Introduction
Country-by-country reporting
The table below discloses our country-by-country reporting data for FY24. As Vicinity operates solely within Australia, the information
below relates to the Australian tax jurisdiction.
Item
Entity name (a)
Vicinity Centres
Tax jurisdiction
Australia
Primary activity
Property investment, property management, property development,
leasing and funds management
Number of employees (b)
1,257
Revenue (c)
$1,326.3 million
Profit before tax
$544.2 million
Tangible assets (d)
$15,512.0 million
Income tax paid and accrued (e)
Nil
Employee benefits expense (f)
$115.9 million
Taxes borne (g)
$108.6 million
Taxes remitted (g)
$138.1 million
Significant uncertain tax positions (h)
None
Notes to table
a. Further information on the controlled entities in the Vicinity Centres Group can be found in the Consolidated Entity Disclosure Statement within the Financial Report.
b. Further information can be found in the FY24 Sustainability Reporting Criteria.
c. Relates to third-party revenue. Further information can be found in Note 2(b) of the Financial Report.
d. Excludes cash and cash equivalents.
e. Further information can be found under the 'Reconciliation of accounting profit to income tax paid and payable' section above.
f.
Further information can be found in Note 15 of the Financial Report.
g. Further information can be found under the 'Contributions to the Australian tax system' section above.
h. There are no significant uncertain tax positions that have not been agreed with relevant tax authorities.
Box Hill Central South, VIC
Sustainability assurance
Securityholders
Directory
Communities
Suppliers
Climate and environment
Risks
Governance
Financial report
61
Tax
Tax transparency
Reconciliation to ATO tax transparency disclosure
The Vicinity Limited income tax consolidated group has a total income in excess of $100.0 million and is subject to public disclosure in
the ATO’s Report of Entity Tax Information that is released annually.
For FY23, this report will be published on the ATO website 1 and it is anticipated to disclose the following information:
($m)
Total income
256.2
Taxable income
–
Tax payable
–
The summary below provides a reconciliation of these disclosures:
($m)
Total income
256.2
Total expenses
(253.1)
Profit before income tax
3.1
Net adjustments for:
Permanent differences
11.3
Temporary differences2
(1.5)
Tax losses utilised
(12.9)
Total taxable income
–
Tax payable
–
Further information
— Vicinity Limited taxes paid information as published by the ATO in the Report of Entity Tax Information:
data.gov.au/dataset/corporate-transparency
— ATO’s webpage on tax transparency for corporate tax entities, including background information and explanations:
ato.gov.au/businesses-and-organisations/corporate-tax-measures-and-assurance/large-business/corporate-tax-transparency/report-
of-entity-tax-information
— A breakdown of the taxable components that securityholders receive via their annual taxation statements will be available in
September 2024 on Vicinity’s website.
1. Expected to be available in November 2024.
2. Adjustments that arise due to differences between when income or expenses are recognised for accounting and tax purposes.
Tax Information
People
Chairman/CEO letter
Highlights
Operating and financial review
Sustainability
Customers
Vicinity Centres | 2024 Annual Report
62
Introduction
The Glen, VIC
63
Sustainability assurance
Securityholders
Directory
Communities
Suppliers
Climate and environment
Risks
Governance
Financial report
Tax
Financial Report
Contents
Directors’ Report
65
Remuneration Report
68
Auditor’s Independence Declaration
93
Statement of Comprehensive Income
94
Balance Sheet
95
Statement of Changes in Equity
96
Cash Flow Statement
97
Notes to the Financial Statement
About this Report
99
Operations
100
1
Segment information
100
2
Revenue and income
102
3
Taxes
104
4
Investment properties
106
5
Equity accounted investments
110
6
Earnings per security
112
Capital structure and financial risk management
113
7
Interest bearing liabilities and derivatives
113
8
Capital and financial risk management
116
9
Contributed equity
121
10 Distributions
121
Working capital
122
11 Trade receivables and other assets
122
12 Payables and other financial liabilities
123
13 Provisions
124
Remuneration
125
14 Key Management Personnel
125
15 Employee benefits expense
125
16 Share based payments
125
Other disclosures
129
17 Intangible assets
129
18 Leases
130
19 Operating cash flow reconciliation
132
20 Auditor’s remuneration
132
21 Parent entity financial information
133
22 Related parties
134
23 Commitments and contingencies
134
24 Other Group accounting matters
135
25 Events occurring after the end of the reporting period
135
Consolidated Entity Disclosure Statement
136
Directors’ Declaration
139
Independent Auditor’s Report
140
People
Chairman/CEO letter
Highlights
Introduction
Operating and financial review
Sustainability
Customers
64
Vicinity Centres | 2024 Annual Report
Directors’ Report
The Directors of Vicinity Limited present the Financial Report
of Vicinity Centres (Vicinity or the Group) for the year ended
30 June 2024. Vicinity Centres is a stapled group comprising
Vicinity Limited (the Company) and Vicinity Centres Trust (the
Trust). Although separate entities, the Stapling Deed entered
into by the Company and the Trust ensures that shares in the
Company and units in the Trust are ‘stapled’ together and
are traded collectively on the Australian Securities Exchange
(ASX), under the code ‘VCX’.
Directors
The Boards of Directors of the Company and
Vicinity Centres RE Ltd, as Responsible Entity (RE) of
the Trust, (together, the Vicinity Board) consist of the same
Directors. The following persons were members of the
Vicinity Board from 1 July 2023 and up to the date of
this report unless otherwise stated:
i) Chairman
Trevor Gerber (Independent)
ii) Non-executive Directors
Clive Appleton
Dion Werbeloff
Georgina Lynch (Independent)
Janette Kendall (Independent)
Michael Hawker AM (Independent)
Peter Kahan (Independent)
Tiffany Fuller (Independent)
Tim Hammon (Independent)
iii) Executive Director
Peter Huddle (CEO and Managing Director)
Further information on the background and experience
of the Directors can be found in the Governance section
of this Report.
Company Secretaries
Carolyn Reynolds
Rohan Abeyewardene
Further information on the background and experience
of the Company Secretaries can be found in the
Governance section of this Report.
Governance – page 50
Principal activities
The principal activities of the Group during the year
continued to be property investment, property management,
property development, leasing, and funds management.
The Group has its principal place of business at:
Level 4, Chadstone Tower One,
1341 Dandenong Road,
Chadstone, Victoria 3148.
Review of results and operations
The results and operations are contained in the Operating
and Financial Review section of this Report.
Operating and financial review – page 10
Significant matters
The Directors are not aware of any matter or circumstance
not otherwise dealt with in the Directors’ Report or the
financial statements that has significantly affected, or may
significantly affect, the operations of the Group, the results of
those operations, or the state of the Group’s affairs in future
financial years.
65
Sustainability assurance
Securityholders
Directory
Communities
Suppliers
Climate and environment
Risks
Governance
Tax
Financial report
Directors’ Report
Distributions
Total distributions for the Group relating to the year ended 30 June 2024 were as follows:
$m
Total
Cents per
VCX stapled
security
Interim, for the six-month period ended 31 December 2023
266.3
5.85
Final, for the six-month period ended 30 June 2024
268.6
5.90
Total distributions, for the year ended 30 June 2024
534.9
11.75
An interim distribution of 5.85 cents per VCX stapled security, which equates to $266.3 million, was paid on 7 March 2024.
On 20 August 2024, the Directors declared a distribution in respect of the Group’s earnings for the six-month period ended 30 June 2024
of 5.90 cents per VCX stapled security, which equates to final distribution of $268.6 million. The final distribution will be paid on 16
September 2024.
Director-related information
Meetings of Directors held during the year1
Board
Audit Committee
Remuneration and
Human Resources
Committee
Risk, Compliance and
ESG Committee
Nominations
Committee
Eligible
Attended
Eligible
Attended
Eligible
Attended
Eligible
Attended
Eligible
Attended
Trevor Gerber
8
8
—
—
—
—
—
—
1
1
Clive Appleton
8
8
—
—
—
—
—
—
—
—
Tiffany Fuller
8
8
4
4
—
—
4
4
—
—
Tim Hammon
8
6
—
—
6
5
4
4
1
1
Michael Hawker AM2
8
8
4
4
6
5
—
—
—
—
Peter Huddle
8
8
—
—
—
—
—
—
—
—
Peter Kahan
8
8
4
4
6
6
—
—
1
1
Janette Kendall
8
7
—
—
6
6
4
4
—
—
Georgina Lynch3
8
8
4
4
—
—
4
4
—
—
Dion Werbeloff
8
8
—
—
—
—
4
4
—
—
1. All Directors have a standing invitation to attend Committee meetings and regularly attend meetings of Committees of which they are not members. The Board
Chairman typically attends all Committee meetings. Such attendance is not reflected in the above table.
2. Michael Hawker AM ceased as a member of the Remuneration and Human Resources Committee and was appointed as a member of the Risk, Compliance and
ESG Committee with effect from 1 July 2024.
3. Georgina Lynch ceased as a member of the Risk, Compliance and ESG Committee and was appointed as a member of the Remuneration and Human Resources
Committee with effect from 1 July 2024.
Director security holdings
Director security holdings are detailed within the Remuneration Report.
Remuneration report – page 68
Indemnification and insurance of Directors and Officers
The Company must indemnify the Directors, on a full indemnity basis and to the full extent permitted by law, against all losses or
liabilities incurred by the Directors as officers of the Company or of a related body corporate provided that the loss or liability does
not arise out of misconduct, including lack of good faith.
During the financial year, the Company insured its Directors, Secretaries and Officers against liability to third parties and for costs
incurred in defending any civil or criminal proceedings that may be brought against them in their capacity as Directors, Secretaries
or Officers of Vicinity. This excludes a liability that arises out of wilful breach of duty or improper use of inside information. The
policy also insures the Company for any indemnity payments it may make to its Officers in respect of costs and liabilities incurred.
Disclosure of the premium payable is prohibited under the conditions of the policy.
People
Chairman/CEO letter
Highlights
Introduction
Operating and financial review
Sustainability
Customers
Vicinity Centres | 2024 Annual Report
66
Directors’ Report
Auditor-related information
Ernst & Young (EY) is the auditor of the Group and is located
at 8 Exhibition Street, Melbourne, Victoria 3000.
Indemnification of the auditor
To the extent permitted by law, the Company has agreed to
indemnify EY, as part of the terms of its audit engagement
agreement, against claims by third parties arising from the audit
(for an unspecified amount). The indemnity does not apply to
any loss arising out of any breach of the audit engagement
agreement or from EY’s negligent, wrongful or wilful acts or
omissions. No payment has been made under this indemnity
to EY during or since the end of the financial year.
Non-audit services
The Group may decide to employ the auditor on assignments
additional to statutory audit duties where the auditor’s
expertise and experience with the Group is essential and will
not compromise auditor independence.
Details of the amounts paid or payable to EY for statutory
audit, assurance and non-audit services provided during the
year are set out in Note 20 to the financial statements.
The Board has considered the non-audit services provided
during the year and is satisfied these services are compatible
with the general standard of independence for auditors
imposed by the Corporations Act 2001 (Cth) for the
following reasons:
҅ The non-audit services and the ratio of non-audit to
audit services provided by EY are reviewed by the Audit
Committee in accordance with the External Audit Policy to
ensure that, in the Audit Committee’s opinion, they do not
impact the impartiality and objectivity of the auditor; and
҅ None of the services undermine the general principles relating
to auditor independence as set out in APES 110 Code of Ethics
for Professional Accountants (including Independence Standards)
as they did not involve reviewing or auditing the auditor’s own
work, acting in a management or decision-making capacity
for the Group, acting as an advocate for the Group or
jointly sharing economic risks and rewards.
Auditor’s independence declaration
A copy of the Auditor’s Independence Declaration as required
under section 307C of the Corporations Act 2001 (Cth) is
included immediately following the Directors’ Report.
Environmental regulation
The Group is subject to the reporting obligations under the
National Greenhouse and Energy Reporting (NGER) Act 2007 (Cth).
This requires the Group to report annual greenhouse gas
emissions, energy use and production for all assets under
management for year ending 30 June. The Group met this
obligation by submitting its NGER report to the Department
of the Environment and Energy for the year ended
30 June 2023 by 31 October 2023. The 2024 NGER report
will be submitted by the 31 October 2024 submission date.
Corporate governance
In recognition of the need for high standards of corporate
behaviour and accountability, the Directors of the Company
have adopted and report against the fourth edition of the
ASX Corporate Governance Council’s Corporate Governance
Principles and Recommendations. The 2024 Corporate
Governance Statement is available on Vicinity’s website.
Corporate Governance
Options over unissued securities
There were 11,264,030 unissued ordinary securities under
option in the form of performance and restricted rights
as at 30 June 2024 and at the date of this report. Refer to
the Remuneration Report for further details of the options
outstanding for Key Management Personnel.
Option holders do not have any rights, by virtue of the option,
to participate in any security issue of the Group.
Events occurring after the end of the reporting period
Acquisition of 50% interest in Lakeside Joondalup
On 19 August 2024, the Group has simultaneously exchanged
contracts and settled on the acquisition of a 50% interest
in Lakeside Joondalup, for $420.0 million. In addition, the
Group also secured the property and retail development
management rights.
Other property transactions
The divestment of investment properties held for sale at
30 June 2024, Maddington Central and Halls Head Central,
were settled in July 2024.
In addition, the Group has executed a contract of sale,
subject to certain conditions precedent customary to such
transaction, to dispose of Mornington Central for $46.3 million
on 29 July 2024. The transaction is expected to be settled by
September 2024.
Other than the matters described above, no other matters
have arisen since the end of the reporting period which have
significantly affected, or may significantly affect, the operations
of the Group, the results of those operations, or the state of
affairs of the Group in future financial periods.
Rounding of amounts
The Company is an entity of a kind referred to in Legislative
Instrument 2016/191, issued by the Australian Securities
and Investments Commission, relating to the ‘rounding off’ of
amounts in the Directors’ Report. Accordingly, amounts in the
Directors’ Report have been rounded off to the nearest tenth
of a million dollars ($m) in accordance with that Legislative
Instrument, unless stated otherwise.
67
Sustainability assurance
Securityholders
Directory
Communities
Suppliers
Climate and environment
Risks
Governance
Tax
Financial report
Remuneration Report
Year in review
FY24 was a productive year at Vicinity. The team delivered
another set of strong operating and financial results and made
meaningful progress with its strategic priorities.
The operating and financial results in FY24 highlight the team’s
focus on embedding earnings resilience via strong leasing
activity, maintaining strong credit metrics and active curation
of an increasingly premium retail asset portfolio.
As expected, elevated costs of living tempered retail sales
growth, notably in the second half of the year, however retailer
confidence to lock in leasing deals remained robust. Continuing
the momentum set in FY23, the team worked at pace to lock
in high quality leasing deals that support current and future
income growth, increased occupancy to 99.3% and minimised
income at risk, measured by leases on holdover. Consequently,
funds from operations (FFO) and net property income (NPI)
exceeded targets.
During the year, the team also progressed Vicinity’s investment
strategy, with the active curation of a more premium asset
portfolio, which we believe will enhance earnings resilience
and drive long-term growth for securityholders.
In FY24, reshaping Vicinity’s asset portfolio was enabled by
the team’s disciplined approach to capital allocation across
acquisitions, major developments, and strategic asset sales.
FY24 remuneration outcomes
The remuneration outcomes for FY24 reflect the intended
operation of the remuneration framework and align with
business performance and securityholder experience.
The FY24 Short Term Incentive (STI) outcomes and the FY21
(FY21-24) Long Term Incentive (LTI) vesting outcomes for the
Executive Key Management Personnel (Executive KMP) are
summarised in the table below.
Executive KMP
FY24 STI
% of maximum
FY21 LTI
Plan vesting
Chief Executive Officer
and Managing Director,
Peter Huddle
74.7
100%
Chief Financial Officer,
Adrian Chye
76.7
100%
The FY21 Total Securityholder Return (TSR) performance rights
were tested at 30 June 2024 and the Board determined that
the TSR rights vested in full. Vicinity’s TSR performance was
at the 87th percentile of the TSR comparator group which was
above the 75th percentile performance required for full vesting.
This is the first vesting of performance rights under the LTI Plan
in four years as the FY18-FY20 LTI were materially impacted
by the pandemic, and all lapsed in full.
Operating and financial review – page 10
Our people – page 26
The Board also determined that the third and final tranche of
the FY21 discounted restricted rights vested. This represents
50% of the total one-off FY21 restricted rights granted in lieu
of Total Return (TR) performance rights, and these rights will
be released to participants in September 2024.
Our people
Investing in our culture and ways of working remained a priority
in FY24 as we create a workplace where everyone has challenging
and rewarding work and where inclusion, belonging, safety and
wellbeing are universal.
Our 2024 Employee Experience Survey saw a four percentage
point increase in engagement to 70%, with 80% of our team
members having their say. In addition, and more importantly,
our people took time to share with us written feedback which
provides valuable insight into what is working well, and the
opportunities we have to improve our employee experience.
We remain committed to targeting gender balance of 40:40:20
across each level of our organisation by the end of FY25.
Our gender composition across our whole company was 62%
female representation, with 52% of all leadership roles being
filled by women. Our senior leadership female talent increased
from 35% in FY23 to 37% in FY24.
Our four volunteer-led and Executive Leadership Team (ELT)
sponsored Employee Advocacy Groups (EAGs), continued to
have a meaningful impact on Vicinity’s workplace culture and
sense of inclusivity, evidenced by our employee experience
survey commentary.
In December 2023, 951 team members were gifted $1,000 worth
of securities under the Tax Exempt Restricted Securities Plan.
More on our people strategy and how this supports Vicinity’s
performance can be found in the Our People section of the
Annual Report.
Conclusion
Your Board recommends the FY24 Remuneration Report to you,
and as always, we welcome securityholder feedback.
Peter Kahan
Chairman – Remuneration and Human Resources Committee
Message from the remuneration and human resources committee
The Remuneration and Human Resources Committee of the Board
(the Committee) is pleased to present Vicinity’s FY24 Remuneration Report.
People
Chairman/CEO letter
Highlights
Introduction
Operating and financial review
Sustainability
Customers
Vicinity Centres | 2024 Annual Report
68
Contents
1. Who is covered by this report?
69
2. Remuneration Report overview
69
3. Key questions
70
4. Remuneration framework
72
5. Company performance and executive remuneration outcomes
78
6. Executive remuneration – further information
87
7. Non-executive Director remuneration
90
1. Who is covered by this report?
This report covers Vicinity’s KMP including all Non-executive Directors and those executives who are deemed to have authority and
responsibility for planning, directing, and controlling the activities of Vicinity. A KMP assessment is completed annually to determine
which members of the ELT should be disclosed as Executive KMP for the financial year. For FY24, the KMP are included in Table 1.1.
Table 1.1: KMP
Name
Position as at 30 June 2024
Board appointment date
Non-Executive Directors
Trevor Gerber
Chairman
28 October 2015
Clive Appleton
Non-executive Director
1 September 2018
Tiffany Fuller
Non-executive Director
16 November 2022
Tim Hammon
Non-executive Director
15 December 2011
Michael Hawker AM
Non-executive Director
16 November 2022
Peter Kahan
Non-executive Director
11 June 2015
Janette Kendall
Non-executive Director
1 December 2017
Georgina Lynch
Non-executive Director
16 November 2022
Dion Werbeloff
Non-executive Director
16 November 2022
Executive KMP
Peter Huddle
Chief Executive Officer and Managing Director (CEO)
1 February 2023
Adrian Chye
Chief Financial Officer (CFO)
—
2. Remuneration report overview
This Remuneration Report outlines:
҅ Vicinity’s reward principles and framework;
҅ Vicinity’s performance for FY24 and the link between Vicinity’s strategy execution, performance and the remuneration outcomes
for our Executive KMP; and
҅ Remuneration received by Non-executive Directors and Executive KMP.
The contents of this Remuneration Report are governed by s300A of the Corporations Act 2001 (Cth) and the Corporations Legislation.
Unless otherwise noted, figures contained within this report are prepared on a basis consistent with the requirements of Australian
Accounting Standards and have been audited.
Remuneration Report
69
Sustainability assurance
Securityholders
Directory
Communities
Suppliers
Climate and environment
Risks
Governance
Tax
Financial report
Remuneration Report
3. Key questions
Key questions
Vicinity approach
Further
information
Remuneration in FY24
What changes were
made to Executive
KMP remuneration
in FY24?
Peter Huddle’s remuneration package remained unchanged effective 1 July 2023.
Adrian Chye’s Total Fixed Remuneration (TFR) was increased by 8.3% from $738,500 to
$800,000 effective 1 July 2023, to align more closely with the market and to reflect his
expanded remit, which now includes IT Operations. This adjustment was made following
a detailed review of relevant Australian external benchmarks, including applicable
ASX100 A-REITs.
Section 5.1
Page 78
Were any
changes made to
Non-executive
Director fees in FY24?
There were no changes to the Chairman’s and Non-executive Director fees in FY24.
Section 7.1
Page 90
How is Vicinity’s
performance
reflected in the
FY24 remuneration
outcomes?
Vicinity delivered strong performance, with FFO, Adjusted FFO (AFFO) and NPI all
exceeding targets. Performance against the strategy measures was close to target
overall, nothwithstanding a very challenging construction market. The executive
remuneration outcomes for FY24 are aligned with our business performance and
with securityholder experience.
Section 5.1
Page 78
Remuneration framework
What changes
have been made to
the remuneration
framework in FY24?
STI: The FFO gateway was reinstated for FY24 and access to the FY24 STI was contingent
on the achievement of a FFO gateway of 95% of target. This ensures that a minimum
financial hurdle must be met before any incentive is paid.
The weighting to the financial measures for the CEO and CFO were increased from
40% to 55% and 60% respectively, with a subsequent reduction to other measures.
Most strategy measures continue to have financial milestones and budgets that
significantly impact financial performance. The combined financial and strategy
measures account for 80% of the total FY24 STI measures for each Executive KMP.
Section 4.3
Page 74
LTI: Following a detailed review of the LTI TR hurdles, the FY24 TR hurdles were
increased from 5.0%-7.5% to 5.5%-7.5%. The TR hurdles were once again determined
through detailed internal modelling over the performance period, including cost of equity
using the Capital Asset Pricing Model, distribution yield on, and growth in, Net Tangible
Assets, and asset capitalisation and discount rates. The Board retains discretion to adjust
the number of TSR performance rights which vest where the TSR is negative.
An absolute TSR gate applied for the FY20-FY21 LTI grants but due to market
uncertainty, was removed for the FY22-FY23 LTI grants. Following a review of market
practice, the Board determined that the absolute TSR gate would not be reinstated for
Vicinity’s relative TSR measure in future LTI grants.
The CEO’s FY24 LTI grant of performance rights was approved by securityholders with
a vote of 99.5% in favour of the resolution at the 2023 Annual General Meeting.
Section 4.4
Page 75
Are any changes planned
to the remuneration
framework in FY25?
STI: The weighting to the financial measures for the Executive KMP will be 55% for FY25.
LTI: The TR hurdles are under review for the FY25 LTI grant.
There are currently no other changes planned to the STI or to the LTI frameworks for
Executive KMP in FY25.
Where does Vicinity
position remuneration
relative to the market?
Fixed and variable remuneration is typically set at the market median, while the maximum
remuneration opportunity can exceed market median when performance has significantly
exceeded target measures.
Section 4.2
Page 74
What proportion
of remuneration
is ‘at risk’?
Most executive remuneration is based on short and long-term Company performance and
is therefore ‘at risk’. The total target ‘at risk' remuneration package (based on face value of
the LTI and target STI opportunity) for the CEO and CFO is 70% and 59% respectively.
Section 4.5
Page 77
People
Chairman/CEO letter
Highlights
Introduction
Operating and financial review
Sustainability
Customers
Vicinity Centres | 2024 Annual Report
70
Remuneration Report
3. Key questions (continued)
Key questions
Vicinity approach
Further
information
Remuneration framework (continued)
How and when does
the Board determine
if it uses discretion?
As a general principle, where a formulaic application of a remuneration metric or
formula may lead to a material or perverse remuneration outcome, or when it is in the
best interests of securityholders for the Board to do so, the Board will consider and
may exercise discretion in determining remuneration outcomes.
Are there any
malus and clawback
provisions for
incentives?
Yes, the Board has the right to reduce future award payments or adjust unvested
amounts to ‘clawback’ from participants if there has been a material misstatement in
Vicinity’s financial results or where a participant has acted fraudulently or dishonestly,
engaged in gross misconduct, breached his or her duties or obligations to the Group
or acted in a manner which brings the Group into disrepute.
Section 6.2
Page 87
What is Vicinity’s
minimum
securityholding
requirement?
The minimum securityholding requirement is:
҅ 100% of TFR for the CEO;
҅ 60% of TFR for the CFO and other members of the ELT; and
҅ 100% of base fees (net of income tax and superannuation) for Non-executive Directors.
Executives have five years to achieve the minimum holding of securities from the end
of the first full financial year following an executive’s commencement date.
Non-executive Directors have five years to acquire the minimum holding of securities
from the Director’s commencement date.
Section 6.3
Page 87
Section 7.3
Page 92
Short-term incentives
Are any STI payments
deferred?
Yes, 50% of any STI award for executives is deferred into equity, vesting equally
after 12 and 24 months following the date of deferral. In the event of resignation or
termination for cause prior to the vesting date, the rights do not vest and are forfeited.
Section 4.3
Page 74
Are STI payments
capped?
Yes, the maximum STI opportunity as a percentage of the target opportunity is 1.5 times
for the CEO and CFO. The maximum amount of STI is payable only when performance
has significantly exceeded target measures.
Section 4.3
Page 74
Long-term incentives
What are the
performance measures
for the LTI?
Performance is measured over four years and allocations of performance rights
are tested against two performance hurdles at the relevant vesting date:
҅ 50% are subject to the achievement of relative TSR; and
҅ 50% are subject to the achievement of TR.
For the purposes of the LTI plan assessment, each performance hurdle operates
independently of the other.
Section 4.4
Page 75
Does the LTI have
re-testing?
No, there is no-retesting of performance conditions following the end of the
performance period.
Section 4.4
Page 75
Are dividends or
distributions paid on
unvested LTI awards?
No, until the performance rights vest, an Executive KMP has no entitlement to receive
dividends or distributions from, nor legal or beneficial interest in, and no voting rights
associated with, the underlying stapled securities.
For the one-off discounted restricted rights granted for FY21, Executive KMP who
were granted restricted rights, will receive distribution equivalent securities at the
time of vesting equal to the distributions that would have been paid had they received
distributions on the restricted rights up until the vesting date.
Section 4.4
Page 75
Is the LTI grant
quantum based
on ‘fair value’ or
‘face value’?
The number of performance rights granted is allocated using a ‘face value’ methodology.
The security price used to calculate the number of performance rights granted is
the volume weighted average price (VWAP) of Vicinity’s securities 10 trading days
immediately following the Annual General Meeting in the year securities are issued.
Section 5.3
Page 84
71
Sustainability assurance
Securityholders
Directory
Communities
Suppliers
Climate and environment
Risks
Governance
Tax
Financial report
Remuneration Report
3. Key questions (continued)
Key questions
Vicinity approach
Further
information
Long-term incentives (continued)
Can LTI participants
hedge their
unvested LTI?
No, Vicinity’s Securities Trading Policy prohibits Executive KMP and other participants
in the LTI and STI deferred restricted securities from hedging or otherwise limiting their
exposure to risk in relation to unvested Vicinity securities issued or acquired under any
applicable equity arrangements.
Section 6.4
Page 87
Does Vicinity buy
securities or issue
new securities for
equity-based awards?
The Board has the discretion to issue new securities or buy securities on-market to
satisfy the allocation of equity-based awards, subject to the requirements of the
ASX Listing Rules. It has been Vicinity’s practice to purchase securities on-market.
Does Vicinity issues
share options?
No, Vicinity uses performance rights for the LTI and restricted rights for the STI deferred
restricted securities.
Section 4.4
Page 75
Other
Were there any
changes to the ELT
in FY24?
Jeheon Son joined Vicinity on 31 July 2023 in the role of Group Director, Development
& Government Relations.
4. Remuneration framework
4.1 Reward principles and framework
The objective of Vicinity’s remuneration framework is to build capability by attracting, retaining, and engaging a talented executive
team capable of managing and enhancing the business, while aligning their actions and outcomes with securityholder interests. We
recognise that remuneration represents just one of the factors that enables the attraction and retention of talent. We also seek to
engage our executives over the long-term and to provide challenging work and personal development opportunities. This is assisted
through linking executive remuneration to both short and long-term Company performance. Our framework encourages executives
to focus on creating long term-value and growth and complements our purpose of shaping meaningful places where communities
connect while ensuring that short-term actions do not have a detrimental effect in the longer-term.
People
Chairman/CEO letter
Highlights
Introduction
Operating and financial review
Sustainability
Customers
Vicinity Centres | 2024 Annual Report
72
Remuneration Report
Reward Principles
Encourage executives
to manage from the perspective
of securityholders
Attract, retain and
engage high-performing
executives
Demonstrate the link
between strategy execution,
performance and reward
Remuneration Framework
Components
TFR
Refer to Section 4.2
Considerations/performance measures
Considerations in setting TFR include:
— external Australian benchmarking,
including applicable ASX100 A-REITs,
and internal relativities
— the size, scope, and complexity of the role
— the individual’s experience, skills, capability,
and performance
Alignment with strategy and performance
Remuneration set at competitive levels, to attract,
retain and engage key talent
STI
Refer to Section 4.3
Executives are assessed against a scorecard
of financial and non-financial measures:
҅ Financial: measures include
FFO, AFFO, NPI and linked to our strategy
pillar: Maintain strong financial stewardship
҅ Strategy: measures linked to our
strategy pillars: Enhance the investment
portfolio; Deliver property excellence;
Enable good business
҅ Culture, leadership and governance:
measures relate to corporate reputation
and sustainability, people, organisational
capability, diversity, inclusion and belonging,
risk, and governance
— Financial measures relate to Vicinity’s
capacity to pay distributions and generate
securityholder returns
— Strategy measures focus on asset and business
performance, development projects and their
financial returns, and the long-term strategic
direction of Vicinity
— Culture, leadership and governance measures
aim to promote a culture and behaviours that
drive Company performance and reflect our
long-term objectives
LTI
Refer to Section 4.4
The performance rights vest following the
four-year performance period subject to
achievement of an:
҅ Internal hurdle based on TR
(not applicable for the FY21 LTI)
҅ External hurdle based on relative TSR
For FY21, a one-off grant of discounted
restricted rights was granted in lieu of
TR performance rights.
҅ The LTI aligns a significant portion of overall
remuneration to securityholder value over the
longer-term
҅ Encourages sustainable high performance over
the medium to long-term and securityholder
value creation
҅ Provides a retention element
҅ TR measures the extent to which Vicinity
efficiently manages and extracts value from
Vicinity’s assets and alignment with underlying
growth in securityholder value
҅ The relative TSR hurdle aligns remuneration
with Vicinity’s long-term return relative to the
nominated comparator groups
҅ The current TSR comparator group achieves a
suitable balance between retail and appropriate
non-retail group exposure
҅ The restricted rights supported retention,
engagement and the competitiveness of the
remuneration package and provided alignment
with securityholder experience
4. Remuneration framework (continued)
4.1 Reward principles and framework (continued)
The diagram below provides an overview of how our reward principles are linked to the components of our remuneration framework
and how these components are measured to ensure that executive and securityholder interests are aligned.
73
Sustainability assurance
Securityholders
Directory
Communities
Suppliers
Climate and environment
Risks
Governance
Tax
Financial report
Remuneration Report
4. Remuneration framework (continued)
4.2 Fixed remuneration
Fixed remuneration comprises base salary and leave entitlements, superannuation contributions and any salary sacrifice amounts
(for example, motor vehicle leases). Vicinity reviews the fixed remuneration component of Executive KMP packages annually to
ensure they remain competitive to attract, retain, and engage key talent. Fixed and variable remuneration is typically set at the market
median, while the maximum remuneration opportunity can exceed market median when performance has significantly exceeded
target measures. External benchmarking is undertaken periodically that incorporates the size, scope and complexity of each role,
which is overlaid with an individual’s experience, capability and performance to determine their fixed remuneration.
4.3 How the STI works
The STI provides Executive KMP and other members of the ELT with the opportunity to be rewarded for achieving a combination of
Vicinity’s financial, strategy, and culture, leadership and governance performance objectives through an annual performance-based
reward. Many of these objectives contribute towards medium to long-term performance outcomes aligned to Vicinity’s strategy.
Opportunity
FY24 STI
opportunity
at a target level
of performance
(% of TFR)
FY24 STI
maximum
opportunity
(% of TFR)
Maximum STI as a
multiple of the
target opportunity
for exceptional
individual and
Vicinity performance
Peter Huddle (CEO)
95
142.5
1.5 times
Adrian Chye (CFO)
65
97.5
1.5 times
Performance
measurement
period
The STI performance measurement period is the full financial year. Where an Executive KMP commences
employment or is appointed during the year, their STI is evaluated and calculated on a pro-rata basis.
Where an Executive KMP ceases employment during the year, if the STI is not forfeited, it is evaluated
and paid on a pro-rata basis. Payment is made at the normal payment date applicable to other employees.
Grant date,
payment and
deferral
STI is provided as a combination of cash and deferred equity. For Executive KMP, 50% of the STI is
deferred into equity vesting equally after 12 and 24 months following the date of deferral. Dividends are
paid on the deferred equity component during the deferral period.
Outcomes are calculated following the Board’s review of Vicinity’s audited financial results and any cash
component is typically paid in September following the end of the financial year.
Performance
targets and
measurement
Section 5.2 provides a detailed summary of the performance objectives and measures and the subsequent
results for Executive KMP for FY24.
Performance objectives for FY24 were finalised by the Board in the case of the CEO, and by the CEO
and the Committee in the case of the CFO. The Committee, with input from the Chairman of the Board,
assesses the CEO’s performance against his objectives and makes the recommendation to the Board for
final determination.
The CEO assesses the performance of the CFO and other ELT members relative to their individual
objectives and makes recommendations to the Committee for final determination.
Refer to Section 5.2 for a summary of the STI outcomes for FY24.
People
Chairman/CEO letter
Highlights
Introduction
Operating and financial review
Sustainability
Customers
Vicinity Centres | 2024 Annual Report
74
Remuneration Report
4. Remuneration framework (continued)
4.4 How the LTI works
Type of equity
awarded
Performance rights
Rights to Vicinity stapled securities at a future time for nil consideration, are subject to the achievement
of agreed performance hurdles at the end of the performance period.
Until the performance rights vest, an Executive KMP has no entitlement to receive dividends or
distributions from, nor legal or beneficial interest in, and no voting rights associated with, the underlying
stapled securities.
FY21 one-off restricted rights
As a one-off change for FY21 only, Executive KMP were granted restricted rights, in lieu of the
TR performance rights. The face value of the restricted rights was equal to 50% of the face value of
the TR performance rights that they replaced. The Board considered the 50% discount to the face value
of the TR performance rights typically granted to be appropriate given the more certain vesting outcome
for the restricted rights.
Executive KMP who were granted restricted rights, will receive distribution equivalent securities at the
time of vesting equal to the distributions that would have been paid, had they received distributions
on the restricted rights up until the vesting date. The number of distribution equivalent securities will
be calculated based on the distributions that would have been paid on the vested securities up until
the vesting date, divided by the VWAP over the five trading days commencing on the first trading
day immediately following the annual results announcement for the financial year ended prior to each
respective vesting date. Stapled securities allocated on vesting of restricted rights will carry the same
dividend, distribution and voting rights as other stapled securities issued by Vicinity.
Performance
period
Performance rights: four years
The FY21 one-off restricted rights granted to Executive KMP, had a performance period as follows:
Percentage of
restricted rights vesting
Performance period
Anticipated or actual time of release
Tranche 1 (25%)
1 July 2020 – 30 June 2022
Released early September 2022
Tranche 2 (25%)
1 July 2020 – 30 June 2023
Released early September 2023
Tranche 3 (50%)
1 July 2020 – 30 June 2024
Early September 2024
Performance
hurdles
Performance rights
Allocations of performance rights are tested against two performance hurdles at the relevant vesting date:
҅ 50% are subject to the achievement of relative TSR1
҅ 50% are subject to the achievement of TR (no TR performance rights were granted for FY21)2
For the purposes of the assessment against the LTI hurdles, each performance hurdle operates
independently of the other.
FY21 one-off restricted rights
The restricted rights granted for FY21 vested in accordance with the schedule set out above, based on
ongoing employment and effective performance as assessed by the Board, taking into consideration
the financial, strategy, portfolio, leadership, risk, governance, and other applicable objectives over the
respective performance periods.
Opportunity
The face value of the CEO and CFO’s LTI opportunity are 140% and 80% of TFR respectively
(unchanged from FY23).
For the FY24 LTI awards, the number of performance rights allocated was determined based on the
10-day VWAP of Vicinity securities immediately following the 2023 Annual General Meeting.
1. Relative TSR combines the security price movement and dividends (which are assumed to be reinvested) to show total return to securityholders, relative to that
of other companies in the comparator group. The FY24 and FY23 comparator group is: Scentre Group (20% weighting); Charter Hall Retail REIT (20% weighting);
Region Group (20% weighting); HomeCo Daily Needs REIT (20% weighting); GPT Group (10% weighting) and Dexus (10% weighting). The FY22 comparator
group is: Scentre Group (25% weighting); Charter Hall Retail REIT (25% weighting); Region Group (25% weighting); GPT Group (12.5% weighting) and Dexus
(12.5% weighting). Prior to FY22, the comparator group was the S&P/ASX 200 A-REIT Index at grant date, excluding Unibail-Rodamco-Westfield (ASX:URW).
Where appropriate, the Board has discretion to adjust the comparator group for events, including but not limited to takeovers and mergers or de-mergers,
that might occur with respect to the entities in the comparator group.
2. TR is calculated each year as the change in Vicinity’s net tangible assets per security (NTA) during the year plus distributions per security made divided by the
NTA at the beginning of the year. The annual TR result for each year during the performance period is then used to calculate the compound annual TR for the
performance period. TR may be adjusted for one-off items such as transaction costs, unrealised foreign exchange movements, unrealised fair value adjustments to
derivatives or other items at the Board’s discretion. This ensures that the outcomes are appropriate and that there is no undue advantage, penalty, or disincentive
for undertaking certain activities.
75
Sustainability assurance
Securityholders
Directory
Communities
Suppliers
Climate and environment
Risks
Governance
Tax
Financial report
Remuneration Report
4. Remuneration framework (continued)
4.4 How the LTI works (continued)
Vesting
schedule
The following vesting schedules apply from FY22:
TSR
TR
Vicinity’s TSR relative to
the weighted TSR of the
comparator group
Percentage
vesting
Compound annual
TR target per annum
Percentage
vesting
Exceeds the comparator
group by 2.7% per annum
(or 11.2% cumulatively
over four years)
100% vesting
҅ For FY24 and FY23:
At or above 7.50%
҅ For FY22:
At or above 7.25%
100% vesting
Between the comparator
group and 2.7% per annum
above the comparator group
Pro-rata
straight-line
vesting between
50% and 100%
҅ For FY24:
Between 5.50% to 7.50%
҅ For FY23:
Between 5.00% to 7.50%
҅ For FY22:
Between 4.50% to 7.25%
Pro-rata
straight-line
vesting between
10% and 100%
Below the
comparator group
Nil vesting
҅ For FY24: Below 5.50%
҅ For FY23: Below 5.00%
҅ For FY22: Below 4.50%
Nil vesting
The following vesting schedules applied for FY21 (no TR performance rights were granted for FY21):
TSR
Percentile ranking
Percentage vesting
Greater than or equal to 75th percentile
100% vesting
Between 51st and 75th percentile
Pro-rata straight-line vesting between 51% and 100%
Less than 51st percentile
Nil vesting
Following testing, any rights that do not vest, lapse.
The FY21 plan included an absolute TSR ‘gate’ ensuring benefit would only be derived from the TSR
performance rights when positive TSR performance is delivered over the four-year performance period.
The absolute TSR ‘gate’ does not apply to TSR performance rights granted after FY21.The Board retains
discretion to adjust the number of TSR performance rights which vest where the TSR is negative.
Refer to Section 5.3 for a summary of the LTI outcomes for FY24.
People
Chairman/CEO letter
Highlights
Introduction
Operating and financial review
Sustainability
Customers
Vicinity Centres | 2024 Annual Report
76
Remuneration Report
4. Remuneration framework (continued)
4.5 Pay mix
The majority of executive remuneration is linked to short and long-term Company performance to assist with aligning executive
interests with those of securityholders. The components of total remuneration and the relative weightings of the fixed and at-risk
components of total target remuneration (using the fair value and face value of the FY24 LTI) and total maximum remuneration (using
the face value of the FY24 LTI) for the Executive KMP are detailed in Table 4.1 below.
The LTI fair value is the value of the LTI calculated in accordance with AASB 2 Share Based Payments and takes into account the
probability of performance hurdles being achieved for the TSR rights and the time value of the four-year vesting period for the TR
performance rights. The LTI face value has not been adjusted for the probability of performance targets being achieved or potential
changes in security price.
Table 4.1: Pay mix
$0
$1,000
$2,000
$3,000
$4,000
$5,000
$6,000
Chief Executive Officer (000s)
Total – $4,326
Total – $5,025
Total – $5,738
$1,500 (35%)
$1,500 (30%)
$1,500 (26%)
$1,425 (33%)
$1,425 (28%)
$1,401 (32%)
$2,100 (42%)
$2,138 (37%)
$2,100 (37%)
Target remuneration
(Fair value LTI)1
Target remuneration
(Face value LTI)2
Maximum remuneration
(Face value LTI)2,3
TFR
LTI
STI
$0
$1,000
$2,000
$3,000
Chief Financial Officer (000s)
Total – $1,747
Total – $1,960
Total – $2,200
$800 (46%)
$800 (41%)
$800 (36%)
$520 (30%)
$520 (27%)
$427 (24%)
$640 (32%)
$780 (35%)
$640 (29%)
Target remuneration
(Fair value LTI)1
Target remuneration
(Face value LTI)2
Maximum remuneration
(Face value LTI)2,3
1. Includes the FY24 LTI based on the fair value of the performance rights awarded on 8 December 2023, valued in accordance with AASB 2 Share Based Payments,
and the FY24 STI at target.
2. Includes the FY24 LTI based on the face value of the performance rights awarded at the time of grant, which differs from the fair values, which are valued in
accordance with AASB 2 Share Based Payments, and the FY24 STI at target.
3. Includes the FY24 STI at maximum.
1 July 2023
30 June 2024
30 June 2025
30 June 2026
30 June 2027
Performance rights subject to four-year performance period and continued service
Based on a scorecard of financial
and non-financial measures
50% paid in cash in Sep 2024 | 25% deferred for 24 months
25% deferred for 12 months
Base salary, superannuation
and any salary-sacrificed items
LTI
STI
Fixed
(TFR)
4.6 When remuneration is delivered
The diagram below provides a timeline of when remuneration is delivered, using FY24 as an example.
Table 4.2: When remuneration is delivered
77
Sustainability assurance
Securityholders
Directory
Communities
Suppliers
Climate and environment
Risks
Governance
Tax
Financial report
Remuneration Report
5. Company performance and executive remuneration outcomes
1. Comparable NPI excludes reversals of prior year waivers and provisions, the impact of acquisitions and divestments and development impacts.
2. Excludes statutory accounting adjustments.
3. Completed or unconditional.
4. By Net Lettable Area.
5.1 Overview of company performance
Vicinity delivered a statutory net profit after tax of $547 million,
primarily comprising FFO of $665 million, offset by a full year
net property valuation decrease, and other statutory and
non-cash items.
At $665 million, FFO was $20 million lower than the prior
year. For comparability purposes, adjusting for one-off items
including reversals of prior year waivers and provisions and
the net impact of transactions; and higher loss of rent from
development, FFO was up 3.2%. This was driven by strong
comparable NPI growth1 and lower net corporate overhead
costs, offset by higher net interest expense.
Comparable NPI growth of 4.1% comprised strong rental
growth, increased portfolio occupancy and recovery of CBDs.
Pleasingly, the portfolio delivered positive net property valuation2
growth in the second half of FY24 (1H: $143 million valuation
loss; 2H: $8 million valuation gain), with continued strong
income growth more than offsetting the minor softening in
valuation metrics.
The Board declared a full year distribution of 11.75 cents per
security FY24 distribution for our securityholders, representing
a payout ratio of 95.2% of AFFO (FY23: 94.9%).
Strong financial stewardship and disciplined capital
management underpin our approach to managing Vicinity’s
balance sheet and credit metrics.
At 27.2%, our gearing remains at the lower end of our 25% to
35% target range, and 79% of Vicinity’s drawn debt is hedged.
Vicinity maintained its investment grade credit ratings of
A/stable (S&P) and A2/stable (Moody’s) and consequently,
the Company enters FY25 in a strong position to invest in
its long-term growth priorities.
Our portfolio strategy remains focused on owning and
investing in the right assets where Vicinity has a clear,
strategic advantage, or the ability to generate superior
value over time. In this context, we believe that premium,
retail assets will deliver more resilient income growth and
sustained value accretion through cycles.
In August 2024, we announced the acquisition of a 50% interest
in Lakeside Joondalup, in Western Australia for $420 million.
Located in the northern suburbs of Perth, Lakeside Joondalup
is a fortress-style, premium retail asset and already achieves
almost $800 million in annual retail sales (#2 in Perth).
As part of the transaction, Vicinity also secured property and
retail development management rights, which provides the
opportunity to utilise Vicinity’s retail management capability to
drive asset performance, whilst earning additional fee income.
Nationally, we divested seven3 non-strategic assets in FY24
along with sundry land parcels, which released more than
$550 million in funds for redeployment into our growth
priorities, including acquisitions and developments. Importantly,
these disposals were executed at a blended 9% premium to
book values.
In October 2023, we announced the acquisition of the residual
49% interest in Chatswood Chase in Sydney. The acquisition
paved the way for the commencement in March 2024 of the
major redevelopment of the centre.
Additionally, we are well progressed on the major retail and
mixed-use development at Chadstone, comprising the One
Middle Road (OMR) office tower and fresh food precinct and
Asian-style alfresco dining laneway. We are delighted to be
welcoming the headquarters of major Australian retailers,
Kmart and Adairs to OMR in 2025. Our agreement with Kmart
represents the largest office leasing deal4 in the Australian
metro markets in 2024.
People
Chairman/CEO letter
Highlights
Introduction
Operating and financial review
Sustainability
Customers
Vicinity Centres | 2024 Annual Report
78
Remuneration Report
5. Company performance and executive remuneration outcomes (continued)
5.1 Overview of company performance (continued)
Table 5.1 provides an overview of Company performance and executive remuneration outcomes. Further detail on these metrics
and achievements is contained in Table 5.3.
Table 5.1: Overview of Company performance and executive remuneration outcomes
What Vicinity achieved
What executives received
FY24 performance
҅ FFO, AFFO and NPI earnings guidance targets were exceeded
҅ At $665 million, FFO was $20 million lower than the prior year.
For comparability purposes, adjusting for one-off items
including reversals of prior year waivers and provisions and
the net impact of transactions; and higher loss of rent from
development, FFO was up 3.2%
҅ FFO per security was 14.6 cents (FY23: 15.0 cents), which
was above the FY24 guidance range of 14.1 to 14.5 cents
҅ Comparable NPI growth of 4.1%1 comprised strong rental
growth, increased portfolio occupancy and recovery of CBDs
҅ Issued $500 million 10-year AMTNs extending duration
at favourable pricing
҅ Negotiated $675 million of new bank debt facilities
҅ Maintained gearing level at 27.2%, while successfully
funding acquisition and development activity
҅ Maintained investment grade credit ratings of A/stable (S&P)
and A2/stable (Moody’s)
҅ Distribution per security was 11.75 cents (FY23: 12.0 cents)
҅ Progressed strategy and culture, leadership and governance
objectives, as detailed in Table 5.3
FY24 TFR
҅ The CEO’s TFR remained unchanged effective 1 July 2023
҅ The CFO’s TFR was increased by 8.3% from $738,500
to $800,000 effective 1 July 2023 to align more closely
with the market and to reflect his expanded remit, which
now includes IT Operations. This adjustment was made
following a detailed review of relevant Australian external
benchmarks, including applicable ASX100 A-REITs
FY24 STI outcomes
҅ The FY24 STI outcomes for Executive KMP, presented
as a percentage of the maximum STI opportunity, are
summarised below
҅ Additional information is provided in Section 5.2
FY24
STI outcome
% of maximum
CEO
74.7
CFO
76.7
Performance period ending 30 June 2024
FY21 performance rights
(Performance period: 1 July 2020 – 30 June 2024)
҅ TSR for the four-year period to 30 June 2024 was 56.4%
(or 11.8% per annum compound)
FY21 (FY21-24) LTI vesting outcome
҅ The FY21 TSR performance rights were tested at 30 June
2024 and the Board determined that the TSR rights vested
in full. Vicinity TSR performance was at the 87th percentile
of the TSR comparator group which was above the 75th
percentile performance required for full vesting
҅ This is the first vesting of performance rights under
the LTI Plan in four years, as the FY18-FY20 LTI were
materially impacted by the pandemic and all lapsed in full
҅ Additional information is provided in Section 5.3 and Table 6.3
FY21 discounted restricted rights
(Performance period: 1 July 2020 – 30 June 2024)
҅ The third and final tranche of the FY21 discounted restricted
rights, which represents 50% of the total one-off restricted
rights granted for FY21, had a three-year performance period
which ended on 30 June 2024
҅ The vesting of the restricted rights is subject to ongoing
employment through to the vesting date and effective performance
as assessed by the Board, taking into consideration the financial,
strategy, portfolio, leadership, risk, governance, and other
applicable objectives over the respective performance periods
҅ The Board reviewed the performance conditions for the
vesting of these restricted rights in August 2024
FY21 discounted restricted rights vesting outcome
҅ The Board determined that the third and final tranche
of the FY21 discounted restricted rights vested. These
rights will be released to participants in September 2024
҅ The restricted rights that vested for Executive KMP are
as follows: CEO: 82,841 and CFO: 12,455. This excludes
distribution equivalent securities which will be calculated
based on the distributions that would have been paid on
the vested securities up until the date the securities are
released in September 2024
҅ Additional information is provided in Section 5.3 and
Table 6.4
1. Comparable NPI growth excludes reversals of prior year waivers and provisions, the net impact of divestments and development impacts.
79
Sustainability assurance
Securityholders
Directory
Communities
Suppliers
Climate and environment
Risks
Governance
Tax
Financial report
5. Company performance and executive remuneration outcomes (continued)
5.1 Overview of company performance (continued)
Table 5.2 provides details of Vicinity’s financial performance for the current and past four financial years.
Table 5.2: Five-year securityholder performance metrics
Securityholder performance metrics
FY20
FY21
FY22
FY23
FY24
Security price as at 30 June ($)1
1.430
1.540
1.835
1.845
1.850
Net tangible assets per security ($)2
2.29
2.13
2.36
2.30
2.30
Distributions relating to financial year earnings (cents)3
7.70
10.00
10.40
12.00
11.75
TR (unadjusted) (%)5
(18.7)
(2.6)
12.5
2.6
5.3
TSR of VCX for the year ended 30 June (%)6
(39.9)
15.0
21.8
6.4
6.9
TSR of the S&P/ASX 200 A-REIT Index (%)6
(21.3)
33.2
(12.3)
8.1
24.6
TSR of the FY22 LTI comparator group (%)7
—
—
2.3
(0.4)
2.9
TSR of the FY23 LTI comparator group (%)7
—
—
—
(1.4)
3.5
TSR of the FY24 LTI comparator group (%)7
—
—
—
—
4.6
1. Security price as at the last trading day of the financial year.
2. Calculated as Balance Sheet net assets less intangible assets, divided by the number of stapled securities on issue at period end. Includes right of use assets and
net investments in leases.
3. From FY22, the distributions declared during the financial year differs from the distributions relating to financial year earnings, as the final distribution declaration
date was moved to after the end of the financial year.
4. Included 2.5 cents attributable to a number of one-off items.
5. Calculated at period end as: (change in NTA during the year + distributions declared)/opening NTA. As explained in Section 4.4, certain adjustments may be made
to the TR amounts included in this table for the purposes of determining the vesting of LTI awards.
6. TSR is calculated as the combination of security price movement from the opening security price, plus distributions (assumed to be reinvested) over the period,
expressed as a percentage. Source: UBS.
7. The TSR comparator groups are set out in Section 4.4.
5.2 FY24 STI outcomes
Summary
The STI outcome for Executive KMP was weighted against the three performance categories as outlined in Table 5.3. Specific measures
are set within these performance categories and are approved by the Board.
Access to the FY24 STI was contingent on the achievement of a FFO gateway of 95% of target. This ensured that a minimum financial
hurdle was met before any incentive is determined. Performance for each measure was then assessed on a range from ‘threshold’ to
‘maximum’. Maximum was set at a level that ensured that the maximum amount of STI is payable only when performance significantly
exceeds target measures.
Outcomes
Tables 5.3 and 5.4 outline performance against the FY24 STI measures. Details of the FY24 STI outcomes for Executive KMP are
included in Table 5.5. Most strategy measures have financial milestones and budgets that significantly impact financial performance.
The combined financial and strategy measures account for 80% of the total FY24 STI measures for each Executive KMP.
4
Remuneration Report
People
Chairman/CEO letter
Highlights
Introduction
Operating and financial review
Sustainability
Customers
Vicinity Centres | 2024 Annual Report
80
5. Company performance and executive remuneration outcomes (continued)
5.2 FY24 STI outcomes (continued)
Table 5.3: Group STI outcomes
Measures
Reason measure
selected
Weight
(%)
Threshold
(0%)
Target
(100%)
Maximum
(150%)
Outcome
(% of target)
Weighted result
(% of maximum)
Financial
55.0
122.7
45.0
FFO
Deliver FFO as per target
of $654m (as adjusted
for asset transactions)
FFO is a
key measure
of financial
performance
used by
securityholders
to determine the
Group’s value
50.0
638
654
125.0
41.7
Achieved $665m
AFFO
Deliver AFFO as per target
of $553m (as adjusted
for asset transactions)
539
553
Achieved $562m
NPI
Deliver NPI as per target
of $878m (as adjusted for
asset transactions)
856
878
Achieved $888m
Maintain
strong financial
stewardship
Prudent capital management,
including proactive
management of weighted
average maturity and
hedging profile, including
execution of new/extended
bank debt facilities and Debt
Capital Markets issuance
at suitable pricing
A disciplined
approach to
evaluating and
deploying capital
is essential
to ensure the
Group’s strong
balance sheet
and credit are
preserved
5.0
҅ Issued $500 million of 10-year AMTNs
extending duration at favourable pricing
҅ Negotiated $675 million of new bank
debt facilities
҅ Maintained gearing level at 27.2%,
while successfully funding acquisition
and development activity
҅ Maintained investment grade
credit ratings of A/stable (S&P)
and A2/stable (Moody’s)
100.0
3.3
Strategy
25.0
98.0
16.3
Enhance the
investment
portfolio
҅ Disciplined pursuit of
priority Premium Mall
and Outlet acquisition
opportunities
҅ Execute on Board-
approved asset disposals
҅ Execute on key
development projects
in delivery in line
with Board approved
feasibilities/programs
҅ Obtain conditional Board
approvals for and/or
commence key pipeline
opportunities
Enhancing the
investment
portfolio
underpins future
value creation
opportunities
and growth, and
impacts future
financial returns
15.0
҅ Acquired the remaining 49%
of Chatswood Chase
҅ Divested more than $550 million
of non-strategic assets at 9% premium
to book values
҅ Progressed major developments at
Chadstone, including an elevated fresh
food and laneway dining precinct, and
One Middle Road office tower more
than 95% leased via executed Heads of
Agreement or Agreements for Lease
҅ Completed fresh food and dining
development at Chatswood Chase, and
commenced major retail development
whilst securing c.80% of income,
via executed Heads of Agreement or
Agreements for Lease
҅ In addition to major developments at
Chadstone and Chatswood Chase, four
smaller redevelopments also completed
at Bayside and Emporium Melbourne in
Victoria, Castle Plaza in South Australia,
and Nepean Village in New South Wales
҅ Secured development approvals for
major mixed-use developments at
Victoria Gardens Shopping Centre and
Box Hill Central North
100.0
10.0
Remuneration Report
81
Sustainability assurance
Securityholders
Directory
Communities
Suppliers
Climate and environment
Risks
Governance
Tax
Financial report
5. Company performance and executive remuneration outcomes (continued)
5.2 FY24 STI outcomes (continued)
Table 5.3: Group STI outcomes (continued)
Measures
Reason
measure selected
Weight
(%)
Threshold
(0%)
Target
(100%)
Maximum
(150%)
Outcome
(% of target)
Weighted result
(% of maximum)
Deliver property
excellence and
enable good
business
҅ Redesign the
commercial model for
the media business and
implement changes
҅ Develop a comprehensive
consumer experience plan
and business cases for
key elements
҅ Commence transformation
project to enhance the
Group’s end-to-end leasing
process (Project Optimus)
҅ Execute on the FY24
elements of the Culture
roadmap to support
transformation required
Property
excellence and
enabling good
business drives
operational
and financial
performance
of our business
and underpins
sustainable
performance
10.0
҅ Improved occupancy to 99.3%
҅ Active portfolio remixing, completing
over 2,000 lease deals, and extending
the weighted average lease expiry,
with an average leasing spread of
1.1% on comparable leasing deals1
҅ Optimised Vicinity’s Media operating
model through partnership with
Cartology, delivering greater certainty of
income and enhanced commercial value
҅ Finalised the consumer experience
plan and defined elements of value
(carparks, wayfinding amenities,
presentation standards, guest services
and safety/security). Wayfinding
business case and carparking pilot
projects approved
҅ Completed a review of the Marketing
and Procurement strategies and
operating models
҅ Commenced phase 1 technology
build aspects of Project Optimus
҅ Completed a comprehensive refresh of
the Group’s Purpose, Vision and Values
to further improve strategic alignment
and high-performance focus
҅ Installed 2.4MW of solar at Grand Plaza
҅ Achieved ISO 27001 certification for
information security
95.0
6.3
Culture, leadership and governance
20.0
100.0
13.3
Culture,
leadership and
governance
҅ Fit for purpose
Diversity, Inclusion
& Belonging program
aligned to strategy
҅ Materially increase the
gender diversity of
senior leadership in FY24
҅ Increase employee
experience survey
outcomes
҅ Achieve improvement in
the tenant and customer
satisfaction and net
promoter scores (TenSAT,
CentreSAT and NPS
respectively) and ensure
Vicinity’s reputation is
not diminished
҅ Continue to drive best
practice relationship
management with
other stakeholders
(securityholders,
Joint Venture partners
and financiers)
Non-financial
measures aim
to promote a
culture and
behaviours that
drive Company
performance and
reflect our long-
term objectives
20.0
҅ Four EAGs continued to have a
meaningful impact on Vicinity’s
workplace culture and sense
of inclusivity
҅ Increased the 2024 engagement score
in the Employee Experience Survey
by 4 percentage points to 70%, with
80% of team members having their say
҅ Increased the Group’s senior leadership
female talent from 35% in FY23
to 37% in FY24
҅ Improved the TenSAT score from
+20 in FY23 to +23 in FY24
҅ Improved CentreSAT score from
+35 in FY23 to +47 in FY24
҅ Achieved a NPS of +35 (FY23: +38)
100.0
13.3
Total
100.0
112.0
74.7
Remuneration Report
1. Comparable leasing deals exclude development deals, reconfigurations and third party assets.
People
Chairman/CEO letter
Highlights
Introduction
Operating and financial review
Sustainability
Customers
Vicinity Centres | 2024 Annual Report
82
5. Company performance and executive remuneration outcomes (continued)
5.2 FY24 STI outcomes (continued)
Table 5.4 provides an overview of the FY24 Executive KMP performance level achieved for each performance category.
Table 5.4: FY24 Executive KMP performance level achieved
CEO
Performance category
Weighting
at target
Performance level achieved
Minimum
Target
Maximum
Financial
55%
Strategy
25%
Culture, leadership and governance
20%
Overall
100%
0%
100%
150%
CFO
Performance category
Weighting
at target
Performance level achieved
Minimum
Target
Maximum
Financial
60%
Strategy
20%
Culture, leadership and governance
20%
Overall
100%
0%
100%
150%
Table 5.5 summarises the FY24 STI outcomes for each Executive KMP.
Table 5.5: FY24 STI outcomes for Executive KMP
Executive KMP
Target STI
as % of TFR
Maximum STI
opportunity as
% of TFR 1
Actual STI
awarded
$
% of target STI
opportunity
awarded
% of maximum
STI opportunity
awarded
% of maximum
STI opportunity
forfeited
Peter Huddle
95
142.5
1,596,000
112.0
74.7
25.3
Adrian Chye
65
97.5
598,000
115.0
76.7
23.3
1. The maximum STI opportunity as % of TFR is the theoretical maximum the Executive KMP can receive. The maximum STI opportunity as a percentage of the
target opportunity is 1.5 times.
Remuneration Report
83
Sustainability assurance
Securityholders
Directory
Communities
Suppliers
Climate and environment
Risks
Governance
Tax
Financial report
5. Company performance and executive remuneration outcomes (continued)
5.3 FY24 LTI outcomes and FY24 LTI grant
Summary
The four-year performance period for the FY21 (FY21-24) LTI Plan commenced on 1 July 2020 and ended on 30 June 2024.
The FY21 LTI provided an opportunity for Executive KMP, other members of the ELT and other eligible participants to receive
a grant of performance rights, subject to the achievement of TSR and a one-off grant of discounted restricted rights. Refer to
Section 4.4 for further details of the LTI Plan.
LTI outcomes for the period ended 30 June 2024
The FY21 TSR performance rights were tested at 30 June 2024 and the Board determined that the TSR rights vested in full.
Vicinity’s TSR performance was at the 87th percentile of the TSR comparator group, which was above the 75th percentile
performance required for full vesting.
The Board also determined that the third and final tranche of the FY21 discounted restricted rights vested. These rights, which
represented 50% of the total one-off restricted rights granted for FY21, had a performance period that ended on 30 June 2024,
and will be released to participants in September 2024. The restricted rights that vested for Executive KMP, excluding any
distribution equivalent securities, are as follows: CEO: 82,841 and CFO: 12,455.
Details of all current LTI holdings for Executive KMP are included in Section 6.5.
FY24 LTI grant
The FY24 LTI grant (FY24 LTI) was made to the Executive KMP, other members of the ELT and other eligible participants with effect
from 1 July 2023, with a four-year performance period that ends on 30 June 2027. Approval for the grant of Peter Huddle’s FY24
performance rights was obtained under ASX Listing Rule 10.14. Table 5.6 shows the number of performance rights granted to the
Executive KMP under the FY24 LTI. The number of performance rights granted was allocated using the face value methodology.
The fair value of the performance rights at grant date is also included in Table 5.6. Fair values are calculated in accordance with
AASB 2 Share Based Payments.
The performance rights may vest after four years provided the TSR and TR hurdles are met. Further details on the LTI performance
hurdles are included in Section 4.4.
Table 5.6: FY24 LTI grants
Executive KMP
Grant date
Face value
of rights on
grant date
$
Number of
performance
rights
1
LTI face value
as a percentage
of TFR at
grant date
%
Fair value
of rights on
grant date 2
$
LTI fair value
as a percentage
of TFR at
grant date
%
Peter Huddle
8 December 2023
2,100,000
1,167,250
140.0
1,400,700
93.4
Adrian Chye
8 December 2023
640,000
355,733
80.0
426,880
53.4
Total
2,740,000
1,522,983
1,827,580
1. The grants made to Executive KMP represent the face value LTI opportunity with effect from 1 July 2023. The security price used in the calculation is the VWAP
of Vicinity’s securities 10 trading days immediately following the 2023 Annual General Meeting of $1.7991.
2. Calculated based on a fair value per right as summarised in the table below.
Grant date
TR rights
$
TSR rights
$
Overall fair value
of LTI grants
$
Overall fair value
of LTI grants as a
% of face value
8 December 2023
1.52
0.88
1.20
66.7
The fair value of the performance rights as at the grant date was valued by independent consultants. The valuation of the TSR
performance rights incorporates the probability of achieving market conditions whereas the valuation of the TR performance
rights does not. This results in a lower fair value for TSR performance rights than for TR performance rights. Further details on the
assumptions used to determine the fair value of the performance rights and the accounting for expenses relating to performance
rights are included in Note 16 to the Financial Report. The minimum total value of the grant to the Executive KMP is nil should none
of the applicable performance conditions be met.
Remuneration Report
People
Chairman/CEO letter
Highlights
Introduction
Operating and financial review
Sustainability
Customers
Vicinity Centres | 2024 Annual Report
84
5. Company performance and executive remuneration outcomes (continued)
5.4 Statutory remuneration
Table 5.7 sets out the statutory remuneration received by each Executive KMP during the current and prior year. This table has
been prepared in accordance with the requirements of the Corporations Act 2001 (Cth) and relevant Australian Accounting Standards.
The figures provided under the performance rights and STI deferred columns are accounting values and do not reflect actual
payments received or the full value of future deferred entitlements awarded during the year.
Table 5.7: Executive KMP statutory remuneration for FY24
Executive KMP
Period
Short-term benefits
Other
benefits
Share based
payments
Post-
employ-
ment
Term-
ination
benefits 7
$
Total
$
Perform-
ance
related 8
%
Base
salary 1
$
STI cash 2
$
Non-
monetary 3
$
Leave
entitle-
ments 4
$
Perform-
ance and
restricted
rights 5
$
STI
deferred 6
$
Super-
annuation
contrib
utions
$
Peter Huddle
FY24
1,472,601
798,000
96,232
18,621
829,500
732,149
27,399
—
3,974,502
59
FY23
1,318,605
737,485
4,409
129,590
540,156
601,543
25,292
—
3,357,080
56
Adrian Chye
FY24
772,601
299,000
1,509
55,670
289,635
283,769
27,399
—
1,729,583
50
FY23
713,208
287,991
1,410
39,651
193,109
224,758
25,292
—
1,485,419
48
Total current
Executive KMP
FY24
2,245,202 1,097,000
97,741
74,291
1,119,135
1,015,918
54,798
—
5,704,085
57
FY23
2,031,813 1,025,476
5,819
169,241
733,265
826,301
50,584
—
4,842,499
53
Grant Kelley9
FY24
—
—
—
—
—
—
—
—
—
—
FY23
556,585
—
4,637
(101,616)
899,169
507,586
12,646
750,000
2,629,007
54
Total current and
former Executive KMP
FY24
2,245,202 1,097,000
97,741
74,291
1,119,135
1,015,918
54,798
—
5,704,085
57
FY23
2,588,398 1,025,476
10,456
67,625 1,632,434
1,333,887
63,230
750,000
7,471,506
53
1. Base salary excludes the annual leave expense recognised in the financial statements for the period in accordance with AASB 119 Employee Benefits.
2. The cash component is 50% of the STI awarded for Executive KMP, and where applicable, is paid in September following the end of the financial year.
3. Non-monetary benefits comprise death and total permanent disability and salary continuance insurance premiums paid by Vicinity on behalf of the Executive
KMP. For the CEO, the FY24 amount includes business related travel costs between Sydney and Melbourne and associated Fringe Benefits Tax of $91,412.
4. Leave entitlements reflect the long service leave and annual leave expense recognised in the financial statements for the period in accordance with AASB 119
Employee Benefits.
5. Under Australian Accounting Standards the remuneration expense for performance rights and restricted rights is based on their fair value at grant date
calculated in accordance with AASB 2 Share Based Payments. For the TSR performance rights and restricted rights, the fair value determined is progressively
expensed over the vesting period of four years, regardless of the ultimate vesting outcome. For TR performance rights, the fair value is also progressively
expensed over the vesting period; however, is reassessed and adjusted to reflect the amount ultimately expected to vest. The amount included as remuneration is
not related to or indicative of the benefit (if any) that Executive KMP may ultimately realise should the performance rights or restricted rights vest. For the former
CEO, the FY23 expense represents the acceleration of the residual expense for the FY20-FY22 performance rights and the FY21 restricted rights to the date of
leaving. Following the subsequent forfeiture of these awards, no actual remuneration was received by Grant Kelley (former CEO) in relation to these awards.
6. 50% of the STI is deferred into restricted securities. For the CEO and CFO, deferred securities vest equally 12 and 24 months following the date of deferral.
The value of STI deferred into securities (and as reported in this table) has been expensed over the relevant vesting period. For the former CEO, the FY23
expense represents the acceleration of the residual expense for the FY22 and FY21 STI deferred to the date of leaving. Following the subsequent forfeiture
of these awards, no actual remuneration was received by the former CEO in relation to these awards.
7. The termination benefits for the former CEO for FY23 represents a payment of six months’ TFR in lieu of notice.
8. Represents the sum of STI cash, Performance and restricted rights, and STI deferred divided by the Total, reflecting the actual percentage of remuneration at
risk for the year.
9. For FY23, represents remuneration for the period as KMP from 1 July 2022 – 16 November 2022.
Remuneration Report
85
Sustainability assurance
Securityholders
Directory
Communities
Suppliers
Climate and environment
Risks
Governance
Tax
Financial report
5. Company performance and executive remuneration outcomes (continued)
5.5 Non-statutory remuneration
Table 5.8 sets out the ‘actual’ remuneration or ‘take home pay’ received by each Executive KMP during the current and prior year.
Actual remuneration differs from statutory remuneration (Table 5.7), which is prepared in accordance with the requirements of the
Corporations Act 2001 (Cth) and Australian Accounting Standards, because the statutory table spreads the value of all equity grants
(including STI deferred restricted securities) across the relevant performance/vesting periods and includes the leave entitlements
expense recognised for the period. The ‘actual’ remuneration table includes any remuneration that was previously deferred while the
individual was KMP, that has become unrestricted. These amounts therefore represent ‘actual’ remuneration for FY24, even though
they were awarded in prior financial years.
Peter Huddle’s fixed remuneration and STI cash were higher in FY24 than in FY23, due mainly to FY24 being his first full year as
CEO. The release of STI deferred was also higher, with the FY24 amount including the release of 25% of the FY23 STI deferred
which included five months as CEO. Adrian Chye’s total remuneration was higher in FY24 than in FY23, due mainly to higher fixed
remuneration in FY24 and the higher value of STI deferred. Further details of the STI deferred restricted securities are provided
in Table 6.2.
Table 5.8: Executive KMP actual remuneration for FY24
Executive KMP
Period
Base salary and other benefits
Share based payments
Termination
benefits 5
$
Total
$
Base
salary 1
$
Super-
annuation
contributions 1
$
Non-
monetary
benefits 1
$
STI cash 1
$
Release of
STI deferred 2
$
Release
of FY21
restricted
rights 3,4
$
Peter Huddle
FY24
1,472,601
27,399
96,232
798,000
647,887
87,863
—
3,129,982
FY23
1,318,605
25,292
4,409
737,485
479,152
87,174
—
2,652,117
Adrian Chye
FY24
772,601
27,399
1,509
299,000
276,593
13,208
—
1,390,310
FY23
713,208
25,292
1,410
287,991
126,836
13,106
—
1,167,843
Total current
Executive KMP
FY24
2,245,202
54,798
97,741
1,097,000
924,480
101,071
—
4,520,292
FY23
2,031,813
50,584
5,819
1,025,476
605,988
100,280
—
3,819,960
Grant Kelley
FY24
—
—
—
—
—
—
—
—
FY23
556,585
12,646
4,637
—
—
160,482
900,501
1,634,851
Total current and
former Executive KMP
FY24
2,245,202
54,798
97,741
1,097,000
924,480
101,071
—
4,520,292
FY23
2,588,398
63,230
10,456
1,025,476
605,988
260,762
900,501
5,454,811
1. As per Table 5.7.
2. Refer Table 6.2 for further details of the STI deferred restricted securities released.
3. Amounts for FY24 represent the release of securities on 11 September 2023, following the vesting of the second tranche of the FY21 discounted restricted
rights. The total securities released, inclusive of distribution equivalent securities, were as follows: Peter Huddle (48,813 securities) and Adrian Chye
(7,338 securities). The values have been calculated based on the security price as at close of business on 11 September 2023 of $1.80.
4. Amounts for FY23 represent the release of securities on 14 September 2022, following the vesting of the first tranche of the FY21 discounted restricted rights.
The total securities released, inclusive of distribution equivalent securities, were as follows: Peter Huddle (45,881 securities), Adrian Chye (6,898 securities)
and Grant Kelley (84,464 securities). The values were calculated based on the security price as at close of business on 14 September 2022 of $1.90.
5. The termination benefits for the former CEO for FY23 represented a payment of six months’ TFR in lieu of notice of $750,000 plus a payment for accrued
statutory annual leave of $150,501.
Remuneration Report
People
Chairman/CEO letter
Highlights
Introduction
Operating and financial review
Sustainability
Customers
Vicinity Centres | 2024 Annual Report
86
6. Executive remuneration – further information
6.1 STI and LTI — cessation of employment or change of control
The Board retains discretion to determine the treatment of the STI and LTI awards on the cessation of employment;
however, generally:
҅ In the event of resignation or termination for cause, any eligibility for STI, STI deferred restricted securities and LTI entitlements
will be forfeited.
҅ In the event of cessation of employment for such reasons as redundancy, death, total and permanent disablement or retirement:
› A pro-rata amount of unvested performance rights and restricted rights which have not yet conditionally vested will remain on
foot, with the balance forfeited. Performance rights may then conditionally vest at the end of the performance period subject to
meeting the performance measures under the associated plan. In these circumstances, the continuous service condition will be
deemed to have been waived.
› STI for the year will be pro-rated over the employment period and paid fully in cash at the same time as all others (no amounts
are deferred into equity).
› STI deferred restricted securities will remain on foot and will vest at the normal vesting date.
In the event of a change in control, the Board has absolute discretion to determine the treatment for STI and LTI entitlements.
6.2 Malus and clawback
The Board has the right to reduce future award payments or adjust unvested amounts to ‘clawback’ from participants if there has
been a material misstatement in Vicinity’s financial results or where a participant has acted fraudulently or dishonestly, engaged in
gross misconduct, breached his or her duties or obligations to the Group or acted in a manner which brings the Group into disrepute.
6.3 Minimum securityholding requirement — Executive KMP
Vicinity operates a minimum securityholding requirement (MSR) for Executive KMP and other members of the ELT. This requires
the CEO and members of the ELT to achieve a minimum holding of securities equal to 100% and 60% of TFR respectively within
five years from the end of the first full financial year following an executive’s commencement date. STI deferred restricted securities
count towards the MSR and Executive KMP may sell securities to cover tax obligations arising from awards that vest.
If, at any time during the five-year accumulation period, the MSR is achieved, the KMP is deemed to have met the MSR, notwithstanding
that the holding value at the end of the five-year accumulation period or at the end of a financial year during the five-year period may
be less than the MSR.
6.4 Security trading restrictions
Vicinity’s Securities Trading Policy prohibits Executive KMP and other participants in the LTI and STI deferred restricted securities
from hedging or otherwise limiting their exposure to risk in relation to unvested Vicinity securities issued or acquired under any
applicable equity arrangements.
6.5 Equity holdings — Executive KMP
Table 6.1 details the number of securities in Vicinity held by Executive KMP, including their personally related parties, as at 30 June 2024.
Given their mandatory nature and the absence of performance conditions, STI deferred restricted securities also count towards the MSR.
Table 6.1: Vicinity securities
Opening
securities as at
1 July 2023
Granted as
remuneration 1
Additions/
disposals during
the year 2
Closing
securities as at
30 June 2024 3
Value as at
30 June 2024 4
$
Minimum
securityholding
guideline
$
Date
securityholding
to be attained
Peter Huddle
617,365
413,644
48,813
1,079,822
1,997,671
1,500,000
June 2025
Adrian Chye
213,876
161,529
(58,759)
316,646
585,795
480,000
June 2027
1. Reflects the allocation of the FY23 STI deferred restricted securities.
2. Reflects the release of securities on 11 September 2023, following the vesting of the second tranche of the FY21 discounted restricted rights and includes
distribution equivalent securities. For Adrian Chye, this includes the addition of 7,388 securities and the disposal of 66,097 securities to cover tax obligations
relating to the vesting of STI deferred restricted securities.
3. Closing securities as at the end of the financial year.
4. Closing securities as at 30 June 2024 multiplied by the VCX closing security price on 30 June 2024 of $1.85 to derive a dollar value.
There were no other related party transactions or balances with KMP or their controlled entities, in relation to securities held.
Remuneration Report
87
Sustainability assurance
Securityholders
Directory
Communities
Suppliers
Climate and environment
Risks
Governance
Tax
Financial report
6. Executive remuneration – further information (continued)
6.5 Equity holdings — Executive KMP (continued)
Table 6.2 details the number of STI deferred restricted securities granted to Executive KMP and the market value of securities
released following the end of their restriction period(s). This aligns with the values included in the ‘Release of STI deferred’ column in
Table 5.8.
Table 6.2: STI deferred restricted securities
Executive KMP Date of grant
STI
deferred
award
year
Value of
STI deferred
equity at time
of grant
$
Security price
used to calculate
the restricted
securities
allocated 1
Number
of restricted
securities
allocated
Restriction
period end
date
Security price
at restriction
period end
date
Market value
of securities
released
$
Peter Huddle
1 July 2023
FY23
368,743
$1.7829
206,822
30 June 2024
$1.850
382,621
368,743
$1.7829
206,822
30 June 2025
—
—
1 July 2022
FY22
273,612
$1.9082
143,387
30 June 2023
$1.845
264,549
273,612
$1.9082
143,387
30 June 2024
$1.850
265,226
1 July 2021
FY21
200,087
$1.7202
116,316
30 June 2023
$1.845
214,603
Adrian Chye
1 July 2023
FY23
143,996
$1.7829
80,765
30 June 2024
$1.850
149,415
143,995
$1.7829
80,764
30 June 2025
—
—
1 July 2022
FY22
131,181
$1.9082
68,746
30 June 2023
$1.845
126,836
131,181
$1.9082
68,745
30 June 2024
$1.850
127,178
1. VWAP of VCX securities traded on the ASX over the 10 trading days immediately preceding the respective STI cash payment dates.
Table 6.3 details the number of performance rights held by Executive KMP, as at 30 June 2024.
Table 6.3: Performance rights
Executive KMP
Grant date
End of
performance
period
Opening
performance
rights 1
Granted as
remuneration
in FY24
Performance
rights vested
Performance
rights lapsed
Closing
unvested
performance
rights
Peter Huddle
FY24
8 Dec 2023
30 Jun 2027
—
1,167,250
—
—
1,167,250
FY23 top-up
20 Feb 2023
30 Jun 2026
201,415
—
—
—
201,415
FY23
8 Dec 2022
30 Jun 2026
561,467
—
—
—
561,467
FY22
10 Dec 2021
30 Jun 2025
632,875
—
—
—
632,875
FY21
11 Dec 2020
30 Jun 2024
331,365
—
331,365
—
—
Total
1,727,122
1,167,250
331,365
—
2,563,007
Adrian Chye
FY24
8 Dec 2023
30 Jun 2027
—
355,733
—
—
355,733
FY23
8 Dec 2022
30 Jun 2026
295,843
—
—
—
295,843
FY22
10 Dec 2021
30 Jun 2025
322,190
—
—
—
322,190
FY21
11 Dec 2020
30 Jun 2024
49,818
—
49,818
—
—
Total
667,851
355,733
49,818
—
973,766
Total number of performance rights
2,394,973
1,522,983
381,183
—
3,536,773
1. The FY21 performance rights for Adrian Chye were awarded prior to his appointment as CFO.
2. Represents the vesting of the FY21 TSR performance rights which will be released in September 2024, subject to the cessation of employment rules.
Remuneration Report
People
Chairman/CEO letter
Highlights
Introduction
Operating and financial review
Sustainability
Customers
Vicinity Centres | 2024 Annual Report
88
6. Executive remuneration – further information (continued)
6.5 Equity holdings — Executive KMP (continued)
Table 6.4 details the number of FY21 one-off restricted rights held by Executive KMP, as at 30 June 2024.
Table 6.4: FY21 one-off restricted rights
Executive KMP
Grant date
End of
performance period
Opening
restricted rights 1
Restricted
rights vested 2 Closing unvested
restricted rights
Peter Huddle
11 Dec 2020
30 Jun 2024
82,841
82,841
—
Adrian Chye
11 Dec 2020
30 Jun 2024
12,455
12,455
—
Total number of restricted rights
—
—
95,296
95,296
—
1. The restricted rights for Adrian Chye were awarded prior to his appointment as CFO.
2. Represents the vesting of the third tranche of the FY21 restricted rights which will be released in September 2024, subject to the cessation of employment rules.
This excludes distribution equivalent securities which will be calculated based on the distributions that would have been paid on the vested securities up until the
date the securities are released, divided by the VWAP over the five trading days commencing on the first trading day that VCX trades without the value of the final
FY24 distribution.
6.6 Service agreements
Remuneration and other terms of employment for Executive KMP are formalised in Executive Services Agreements (ESAs). The terms
and conditions of employment of the Executive KMP reflect market conditions at the time of entering into their contract.
Key features of the Executive KMP ESAs include the following:
҅ Eligibility to participate in short and long-term incentive plans.
҅ Ongoing employment until terminated by either the Executive KMP or Vicinity.
҅ Vicinity may make payments in lieu of all or part of the applicable notice period.
Notice period provisions are detailed below.
Executive KMP
Termination by Vicinity
Termination
by Executive KMP
Termination payment1
For cause
Other
Peter Huddle
Immediately
6 months
6 months
6 months’ TFR
Adrian Chye
Immediately
6 months
6 months
6 months’ TFR
1. Paid, subject to law, if Vicinity terminated the Executive KMP’s employment agreement on notice and without cause, and makes payment in lieu of notice.
Termination payments are generally not paid on resignation or termination with cause, although the Board may determine exceptions to this. No termination
payment will exceed the limit under the Corporations Act 2001 (Cth).
6.7 Governance and how remuneration decisions are made
The Board of Directors has responsibility to ensure that appropriate governance is in place in relation to all human resource
matters including remuneration. To ensure that the Board acts independently of management and is fully informed when making
remuneration decisions, the Board has established the following protocols:
҅ The Board has established the Remuneration and Human Resources Committee comprised of Non-executive Directors, which
is responsible for reviewing and making recommendations on remuneration policies for Vicinity, including policies governing
the remuneration of Executive KMP and other members of the ELT. Further information regarding the respective roles and
responsibilities of the Board and the Committee are contained in their respective charters, available in the Corporate Governance
section of Vicinity’s website and in Vicinity’s 2024 Corporate Governance Statement.
҅ When considering the recommendations of the Committee, the Board applies a policy of excluding any executives from being
present and participating in discussions impacting their own remuneration.
҅ The Committee can seek advice from both management and external advisors in developing its remuneration recommendations for
the Board.
To assist in performing its duties, and making recommendations to the Board, the Committee directly engages external advisors to
provide input to the process of reviewing Executive KMP and Non-executive Director remuneration, and to provide advice on various
aspects of the remuneration framework. This advice is sought when required and no advice was sought during FY24.
Remuneration Report
Corporate governance – page 50
2024 Corporate Governance Statement
89
Sustainability assurance
Securityholders
Directory
Communities
Suppliers
Climate and environment
Risks
Governance
Tax
Financial report
7. Non-executive director remuneration
7.1 Remuneration philosophy
Non-executive Director fee levels are set with regard to time commitment and workload, the risk and responsibility attached to the
role and external market benchmarking. Non-executive Director base fees were increased effective 1 July 2022 and the current
maximum fee pool of $2.70 million was approved by Vicinity securityholders on 16 November 2022. No element of Non-executive
Director remuneration is ‘at risk’, that is, no element is based on the performance of Vicinity.
Board and Committee fees
Table 7.1 details the FY24 Board and Committee fees.
Table 7.1: FY24 Board and Committee fees
Board/Committee
Role
FY24 fees
per annum 1
$
Board
Chairman
486,500
Non-executive Director
175,000
Audit Committee
Chairman
41,200
Member
20,600
Risk, Compliance and ESG Committee
Chairman
41,200
Member
20,600
Remuneration and Human Resources Committee
Chairman
41,200
Member
20,600
Nominations Committee
Chairman
No additional fee
Member
No additional fee
1. Fees are inclusive of superannuation.
The Chairman of the Board receives no further remuneration for Committee membership, although he may attend Committee meetings.
Non-executive Directors are entitled to be reimbursed for all reasonable business-related expenses, including travel on Company
business, that may be incurred in the discharge of their duties.
Remuneration Report
People
Chairman/CEO letter
Highlights
Introduction
Operating and financial review
Sustainability
Customers
Vicinity Centres | 2024 Annual Report
90
7. Non-executive director remuneration (continued)
7.2 Fees and benefits paid
Table 7.2 details the fees and benefits paid to Non-executive Directors for FY24.
Table 7.2: Non-executive Directors’ fees for FY24
Non-executive Director
Period
Short-term benefits
Post-employment
benefits 2
Total fees
$
Fees 1
$
Committee fees
$
Superannuation
contributions
$
Trevor Gerber, Chairman
FY24
459,101
—
27,399
486,500
FY23
461,208
—
25,292
486,500
Clive Appleton3
FY24
175,000
—
—
175,000
FY23
175,000
—
—
175,000
Tiffany Fuller4
FY24
170,664
60,269
5,867
236,800
FY23
107,348
28,642
2,568
138,558
Tim Hammon
FY24
157,658
55,675
23,467
236,800
FY23
158,371
55,928
22,501
236,800
Michael Hawker AM4
FY24
175,000
41,200
—
216,200
FY23
107,296
25,261
2,568
135,125
Peter Kahan
FY24
157,658
55,675
23,467
236,800
FY23
158,371
55,928
22,501
236,800
Janette Kendall
FY24
157,658
37,117
21,425
216,200
FY23
158,371
37,285
20,544
216,200
Georgina Lynch4
FY24
157,658
37,117
21,425
216,200
FY23
98,982
23,303
12,840
135,125
Dion Werbeloff3,4
FY24
175,000
20,600
—
195,600
FY23
109,375
12,875
—
122,250
Total current
Non-executive Directors
FY24
1,785,397
307,653
123,050
2,216,100
FY23
1,534,322
239,222
108,814
1,882,358
Karen Penrose5
FY24
—
—
—
—
FY23
32,993
11,652
4,688
49,333
Dr David Thurin AM5
FY24
—
—
—
—
FY23
59,485
—
6,246
65,731
Total former
Non-executive Directors
FY24
—
—
—
—
FY23
92,478
11,652
10,934
115,064
Total current and former
Non-executive Directors
FY24
1,785,397
307,653
123,050
2,216,100
FY23
1,626,800
250,874
119,748
1,997,422
1. Unless otherwise stated, fees represent fees paid to Non-executive Directors in their capacity as Directors of Vicinity Limited (the Company) and Vicinity Centres
RE Ltd as Responsible Entity for Vicinity Centres Trust (the RE) whose Boards and Committees meet concurrently.
2. Non-executive Directors receive no post-employment benefits other than statutory superannuation. Where a Non-executive Director applies to the ATO for an
exemption to the superannuation guarantee, no superannuation contributions are made.
3. Fees for Clive Appleton and Dion Werbeloff are paid to The Gandel Group Pty Limited and therefore no superannuation contributions were made by Vicinity on
their behalf.
4. Appointed to the Board on 16 November 2022.
5. Karen Penrose and Dr David Thurin AM retired from the Board effective 15 September 2022 and 15 November 2022 respectively.
Remuneration Report
91
Sustainability assurance
Securityholders
Directory
Communities
Suppliers
Climate and environment
Risks
Governance
Tax
Financial report
Remuneration Report
7. Non-executive director remuneration (continued)
7.3 Minimum securityholding requirement – Non-executive Directors
Vicinity operates a MSR for Non-executive Directors. This encourages independent Directors to acquire a holding of securities with
a minimum cost equal in value to one year of Non-executive Director base fees (net of income tax and superannuation) within five
years from the Director’s commencement date.
If, at any time during the five-year accumulation period, the MSR is achieved, the Non-executive Director is deemed to have met the
MSR, notwithstanding that the holding value at the end of the five-year accumulation period or at the end of a financial year during
the five-year period may be less than the MSR.
All required Non-executive Directors, including the Chairman, have met the MSR, having acquired securities with a total cost
exceeding the policy value required.
7.4 Non-executive Director securityholdings
Table 7.3 details the number of securities in Vicinity held by Non-executive Directors, including their personally related parties, as at
30 June 2024.
Table 7.3: Non-executive Director securityholdings
Opening securities
as at 1 July 2023
Additions
during the year
Closing
securities as at
30 June 2024 1
Minimum security
holding guideline 2
$
MSR
satisfied
Date security
holding to be
attained
Non-executive Directors
Trevor Gerber
220,834
—
220,834
243,324
Clive Appleton3
32,295
50,000
82,295
83,559
NA
Tiffany Fuller
—
55,000
55,000
83,559
Tim Hammon
63,889
—
63,889
83,559
Michael Hawker AM
94,715
—
94,715
83,559
Peter Kahan
43,417
—
43,417
83,559
Janette Kendall
63,110
—
63,110
83,559
Georgina Lynch
—
—
—
83,559
Nov 2027
Dion Werbeloff3
—
—
—
83,559
NA
1. Closing securities as at the end of the financial year. There were no changes to the balance of securities between the end of the financial year and the date of the
Directors report.
2. The guideline amount for the directors that have satisfied the MSR is slightly lower than the guideline amounts in the table which have been calculated based
on the current Non-executive Director base fees, effective 1 July 2023 and using the 2023-2024 superannuation guarantee rate.
3. Included for completeness but not covered by the MSR as non-independent Non-executive Directors.
There were no other related party transactions or balances with KMP or their controlled entities, in relation to securities held.
End of Remuneration Report.
Signed in accordance with a resolution of Directors.
Trevor Gerber
Chairman
20 August 2024
People
Chairman/CEO letter
Highlights
Introduction
Operating and financial review
Sustainability
Customers
Vicinity Centres | 2024 Annual Report
92
A member firm of Ernst & Young Global Limited
Liability limited by a scheme approved under Professional Standards Legislation
Ernst & Young
8 Exhibition Street
Melbourne VIC 3000 Australia
GPO Box 67 Melbourne VIC 3001
Tel: +61 3 9288 8000
Fax: +61 3 8650 7777
ey.com/au
Auditor’s Independence Declaration to the Directors of Vicinity Limited
As lead auditor for the audit of the financial report of Vicinity Limited for the financial year ended
30 June 2024, I declare to the best of my knowledge and belief, there have been:
a) No contraventions of the auditor independence requirements of the Corporations Act 2001 in
relation to the audit;
b) No contraventions of any applicable code of professional conduct in relation to the audit; and
c) No non-audit services provided that contravene any applicable code of professional conduct in
relation to the audit.
This declaration is in respect of Vicinity Limited and the entities it controlled during the financial year.
Ernst & Young
Michael Collins
Partner
20 August 2024
Auditor’s Independence Declaration
93
Sustainability assurance
Securityholders
Directory
Communities
Suppliers
Climate and environment
Risks
Governance
Tax
Financial report
Note
30 Jun 24
$m
30 Jun 23
$m
Revenue and income
Property ownership revenue and income
1,249.4
1,209.8
Management fee revenue from strategic partnerships
67.8
64.8
Interest and other income
9.1
6.8
Total revenue and income
2(b)
1,326.3
1,281.4
Share of net loss of equity accounted investments
5(b)
(14.3)
(50.9)
Property revaluation decrement for directly owned properties
4(b)
(38.9)
(195.9)
Direct property expenses
(377.8)
(349.7)
Allowance for expected credit losses
11(b)
0.2
21.5
Borrowing costs
7(c)
(216.5)
(204.7)
Employee benefits expense
15
(115.9)
(110.6)
Net foreign exchange movement on interest bearing liabilities
6.9
(139.9)
Net mark-to-market movement on derivatives
36.3
66.4
Depreciation of right of use assets
18(a)
(4.5)
(4.9)
Landholder duty written off on acquisition of investment property
4(b)
(17.7)
—
Other expenses
(39.9)
(46.6)
Net profit before tax for the year
544.2
266.1
Income tax benefit
3(a)
2.9
5.4
Net income for the year
547.1
271.5
Other comprehensive income
—
—
Total comprehensive income for the year
547.1
271.5
Total (loss)/income and total comprehensive (loss)/income for the year
attributable to stapled securityholders as:
Securityholders of Vicinity Limited
(10.2)
(0.8)
Securityholders of other stapled entities of the Group
557.3
272.3
Total comprehensive income for the year
547.1
271.5
Earnings per security attributable to securityholders of the Group:
Basic earnings per security (cents)
6
12.02
5.96
Diluted earnings per security (cents)
6
11.99
5.95
The above consolidated Statement of Comprehensive Income should be read in conjunction with the accompanying notes.
Statement of Comprehensive Income
for the year ended 30 June 2024
People
Chairman/CEO letter
Highlights
Introduction
Operating and financial review
Sustainability
Customers
Vicinity Centres | 2024 Annual Report
94
Note
30 Jun 24
$m
30 Jun 23
$m
Current assets
Cash and cash equivalents
49.6
192.9
Trade receivables and other assets
11(a)
94.4
124.5
Investment properties classified as held for sale
4(a)
186.6
—
Derivative financial instruments
7(e)
68.0
39.1
Total current assets
398.6
356.5
Non-current assets
Investment properties
4(a)
14,771.4
14,288.4
Equity accounted investments
5(a)
91.8
437.5
Intangible assets
17
164.2
164.2
Plant and equipment
3.0
3.4
Derivative financial instruments
7(e)
184.6
227.6
Right of use assets
18(a)
26.2
24.6
Deferred tax assets
3(c)
77.6
74.7
Other assets
11(a)
8.4
7.7
Total non-current assets
15,327.2
15,228.1
Total assets
15,725.8
15,584.6
Current liabilities
Interest bearing liabilities
7(a)
487.5
323.0
Payables and other financial liabilities
12
226.4
195.4
Lease liabilities
18(a)
6.0
5.4
Provisions
13
76.2
77.6
Derivative financial instruments
7(e)
60.6
59.3
Total current liabilities
856.7
660.7
Non-current liabilities
Interest bearing liabilities
7(a)
3,742.7
3,750.5
Lease liabilities
18(a)
386.2
382.5
Provisions
13
4.1
3.9
Derivative financial instruments
7(e)
97.2
148.9
Total non-current liabilities
4,230.2
4,285.8
Total liabilities
5,086.9
4,946.5
Net assets
10,638.9
10,638.1
Equity
Contributed equity
9
9,102.2
9,102.2
Share based payment reserve
13.3
8.8
Retained profits
1,523.4
1,527.1
Total equity
10,638.9
10,638.1
The above consolidated Balance Sheet should be read in conjunction with the accompanying notes.
Balance Sheet
as at 30 June 2024
95
Sustainability assurance
Securityholders
Directory
Communities
Suppliers
Climate and environment
Risks
Governance
Tax
Financial report
Statement of Changes in Equity
for the year ended 30 June 2024
Note
Attributable to
securityholders of Vicinity Limited
Attributable to securityholders
of other stapled entities of the Group
VCX
Group
Contri-
buted
equity
$m
Reserves
$m
Accum-
ulated
losses
$m
Total
$m
Contri-
buted
equity
$m
Reserves
$m
Retained
profits
$m
Total
$m
Total
equity
$m
As at 1 July 2022
541.4
6.0
(209.7)
337.7
8,560.8
—
1,986.6
10,547.4
10,885.1
Net (loss)/profit for the year
—
—
(0.8)
(0.8)
—
—
272.3
272.3
271.5
Total comprehensive (loss)/income for the year
—
—
(0.8)
(0.8)
—
—
272.3
272.3
271.5
Transactions with securityholders in their
capacity as securityholders:
Net movements in share based payment reserve
—
2.8
—
2.8
—
—
—
—
2.8
Distributions paid
10(b)
—
—
—
—
—
—
(521.3)
(521.3)
(521.3)
Total equity as at 30 June 2023
541.4
8.8
(210.5)
339.7
8,560.8
—
1,737.6
10,298.4
10,638.1
As at 1 July 2023
541.4
8.8
(210.5)
339.7
8,560.8
—
1,737.6
10,298.4
10,638.1
Net (loss)/profit for the year
—
—
(10.2)
(10.2)
—
—
557.3
557.3
547.1
Total comprehensive (loss)/income for the year
—
—
(10.2)
(10.2)
—
—
557.3
557.3
547.1
Transactions with securityholders in their
capacity as securityholders:
Net movements in share based payment reserve
—
4.5
—
4.5
—
—
—
—
4.5
Distributions paid
10(b)
—
—
—
—
—
—
(550.8)
(550.8)
(550.8)
Total equity as at 30 June 2024
541.4
13.3
(220.7)
334.0
8,560.8
—
1,744.1
10,304.9
10,638.9
The above Statement of Changes in Equity should be read in conjunction with the accompanying notes.
People
Chairman/CEO letter
Highlights
Introduction
Operating and financial review
Sustainability
Customers
Vicinity Centres | 2024 Annual Report
96
Cash Flow Statement
for the year ended 30 June 2024
Note
30 Jun 24
$m
30 Jun 23
$m
Cash flows from operating activities
Receipts in the course of operations
1,523.1
1,512.8
Payments in the course of operations
(641.5)
(628.7)
Distributions and dividends received from equity accounted entities
8.3
12.7
Interest received
5.0
2.4
Interest paid
(204.8)
(193.5)
Net cash inflows from operating activities
19
690.1
705.7
Cash flows from investing activities
Payments for capital expenditure on investment properties
(336.4)
(333.8)
Proceeds from disposal of investment properties
309.3
134.5
Payment for acquisition of remaining interest in Chatswood Chase including landholder
duty and transaction costs1
(325.2)
—
Advances to equity accounted entities
(81.8)
(3.5)
Payments for acquisition of other investments
(1.0)
(3.0)
Payments for plant and equipment
(0.6)
(0.9)
Net cash outflows from investing activities
(435.7)
(206.7)
Cash flows from financing activities
Proceeds from borrowings
1,538.0
840.0
Repayment of borrowings
(1,373.0)
(660.0)
Payment of lease liabilities
18(a)
(2.7)
(5.0)
Distributions paid to external securityholders
10(b)
(550.8)
(521.3)
Debt establishment costs paid
(6.0)
(3.5)
Termination of interest rate swaps
—
(6.9)
Acquisition of shares on-market for settlement of share-based payments
(3.2)
(5.0)
Net cash outflows from financing activities
(397.7)
(361.7)
Net (decrease)/increase in cash and cash equivalents held
(143.3)
137.3
Cash and cash equivalents at the beginning of the year
192.9
55.6
Cash and cash equivalents at the end of the year
49.6
192.9
1. Cash consideration of $331.6 million as disclosed in Note 5(a) is net against cash acquired of $6.4 million.
The above Cash Flow Statement should be read in conjunction with the accompanying notes.
97
Sustainability assurance
Securityholders
Directory
Communities
Suppliers
Climate and environment
Risks
Governance
Tax
Financial report
Notes to the Financial Statements
The index of notes to the financial statements is shown below. Similar notes have been grouped into sections with relevant
accounting policies and judgements and estimates disclosures incorporated within the notes to which they relate. The ‘About this
Report’ section which precedes the notes to the financial statements contains information on the basis of preparation of the financial
report, adoption of new accounting standards and significant accounting judgements, estimates and assumptions.
Contents
Operations
1
Segment information
2
Revenue and income
3
Taxes
4
Investment properties
5
Equity accounted investments
6
Earnings per security
Capital structure and financial risk management
7
Interest bearing liabilities and derivatives
8
Capital and financial risk management
9
Contributed equity
10 Distributions
Working capital
11 Trade receivables and other assets
12 Payables and other financial liabilities
13 Provisions
Remuneration
14 Key management personnel
15 Employee benefits expense
16 Share based payments
Other disclosures
17 Intangible assets
18 Leases
19 Operating cash flow reconciliation
20 Auditor’s remuneration
21 Parent entity financial information
22 Related parties
23 Commitments and contingencies
24 Other Group accounting matters
25 Events occurring after the end of the reporting period
People
Chairman/CEO letter
Highlights
Introduction
Operating and financial review
Sustainability
Customers
Vicinity Centres | 2024 Annual Report
98
Reporting entity
The financial statements are those of the stapled Group
comprising Vicinity Limited (the Company) and Vicinity Centres
Trust (the Trust) (collectively the Group). The Stapling Deed
entered into by the Company and the Trust ensures that shares
in the Company and units in the Trust are ‘stapled’ together and
are traded collectively on the Australian Securities Exchange
(ASX) under the code ‘VCX’. For financial reporting purposes,
the Company has been identified as the parent entity of the
Group.
The Company and the Trust are for-profit entities that are
domiciled and operate wholly in Australia.
Basis of preparation
This general purpose Financial Report:
҅ Has been prepared in accordance with the Corporations
Act 2001 (Cth) and Australian Accounting Standards
(AASBs) issued by the Australian Accounting Standards
Board. Compliance with AASBs ensures compliance with
International Financial Reporting Standards (IFRS) as issued
by the International Accounting Standards Board (IASB);
҅ Is presented in Australian dollars ($) and rounded to the nearest
tenth of a million dollars ($m) in accordance with ASIC Legislative
Instrument 2016/191 (unless otherwise stated);
҅ Has been prepared in accordance with the historical cost
convention, except for certain financial assets and liabilities,
and investment properties which have been recognised at
fair value; and
҅ Was authorised for issue by the Board of Directors on
20 August 2024.
The presentation of certain items has been adjusted as
necessary to provide more meaningful information in the
context of the Group. Where the presentation or classification
of items in the Financial Report is amended, comparative
amounts are also reclassified unless it is impractical. The
adjustments made to the presentation of items had no impact
on the net assets or net profit/loss of the Group.
About this Report
Going concern
While the Group has a net current asset deficiency of
$458.1 million (current liabilities exceed current assets) at
reporting date (30 June 2023: net current deficit $304.2 million),
the Group has available liquidity including undrawn facilities of
$1,332.0 million (30 June 2023: $1,222.0 million), cash and cash
equivalents of $49.6 million (30 June 2023: $192.9 million) and
generates sufficient operating cash flows to pay its debts as and
when they fall due for a period of 12 months from the date of
these financial statements. Accordingly, the Financial Report has
been prepared on a going concern basis.
Significant accounting judgements,
estimates and assumptions
The preparation of financial statements requires the Group to
make judgements in the application of accounting policies and
estimates when developing assumptions that affect the reported
amounts of certain revenues, expenses, assets and liabilities.
These judgements and estimates are made considering historical
experience and other reasonable and relevant factors but are
inherently uncertain. Due to this inherent uncertainty, actual
results may differ from these judgements and estimates.
The table below summarises the areas of the Financial Report
subject to significant judgement and estimation:
Area of judgement or estimation
Note
Valuation of investment properties
4
Recognition of deferred tax assets
3
Recoverability of intangible assets
17
Valuation of derivative financial instruments
7
99
Sustainability assurance
Securityholders
Directory
Communities
Suppliers
Climate and environment
Risks
Governance
Tax
Financial report
The Group’s operating segments identified for internal reporting purposes are:
҅ Property Investment: performance is assessed based on net property income which comprises revenue less expenses derived from
investment in retail property; and
҅ Strategic Partnerships: performance is assessed based on fee income from property management, development and leasing of
assets wholly or jointly owned by capital partners and includes fees from the management of wholesale property funds.
Information on these segments is presented on a proportionate basis. This presents net property income and investment property
assets relating to equity accounted properties as if they were consolidated investment properties within the Group’s segment results.
This allows for consistent internal reporting on all investment property assets and segment activities to enable the Chief Operating
Decision Makers (CODM) to make strategic decisions, regardless of ownership structure arrangements. During the period, the CODM
were the Chief Executive Officer and Managing Director (CEO) and the Chief Financial Officer (CFO).
Group performance is assessed based on funds from operations (FFO), which is calculated as statutory net profit after tax, adjusted
for fair value movements, certain unrealised and non-cash items, amounts which are capital in nature and other items that are not
considered to be in the ordinary course of business. In addition to FFO, adjusted funds from operations (AFFO) is considered when
assessing the performance of the Group. AFFO represents the Group’s FFO adjusted for investment property maintenance capital
and static tenant leasing costs and other capital items incurred during the year. FFO and AFFO are determined with reference to
guidelines published by the Property Council of Australia (PCA) and are non-IFRS measures.
a)
Segment results
The segment financial information and metrics provided to the CODM are set out below.
Financial performance
30 Jun 24
$m
30 Jun 23
$m
Property Investment segment
Net property income
888.4
900.2
Strategic Partnerships segment
External management fees
59.7
60.5
Total segment income
948.1
960.7
Corporate overheads
(93.9)
(96.7)
Net interest expense
(189.6)
(179.2)
FFO
664.6
684.8
Adjusted for:
Maintenance capital and static tenant leasing costs
(102.7)
(101.9)
Termination of interest rate swaps
—
(6.9)
AFFO
561.9
576.0
Key metrics
Note
30 Jun 24
$m
30 Jun 23
$m
FFO per security1 (cents per security)
14.60
15.04
AFFO per security1 (cents per security)
12.34
12.65
Distribution per security2 (DPS) (cents per security)
10(a)
11.75
12.00
Total distributions declared2 ($m)
10(a)
534.9
546.3
AFFO payout ratio (total distributions declared $m/AFFO $m) (%)
95.2%
94.9%
FFO payout ratio (total distributions declared $m/FFO $m) (%)
80.5%
79.8%
1. The calculation of FFO and AFFO per security for the period uses the basic weighted average number of securities on issue as calculated in Note 6.
2. Distribution per security and the total distributions declared are calculated based on the estimated number of securities outstanding at the time of the
distribution record date.
1. Segment information
Operations
People
Chairman/CEO letter
Highlights
Introduction
Operating and financial review
Sustainability
Customers
Vicinity Centres | 2024 Annual Report
100
1. Segment information (continued)
b)
Reconciliation of net profit after tax to FFO
30 Jun 24
$m
30 Jun 23
$m
Net profit after tax
547.1
271.5
Property revaluation decrement for directly owned properties
38.9
195.9
Non-distributable loss relating to equity accounted investments1
28.4
73.4
Amortisation of lease incentives2
72.6
68.8
Straight-lining of rent adjustment3
(6.5)
(2.8)
Net mark-to-market movement on derivatives3
(36.3)
(66.4)
Net unrealised foreign exchange movement on interest bearing liabilities3
(6.9)
139.9
Income tax benefit3
(2.9)
(5.4)
Development-related preliminary planning, marketing and tenant compensation costs4
6.7
1.7
Landholder duty
17.7
—
Other non-distributable items
5.8
8.2
FFO
664.6
684.8
The material adjustments to net loss after tax to arrive at FFO and reasons for their exclusion are described below:
1. FFO excludes property revaluation and other non-cash accounting adjustments relating to equity accounted investments.
2. Lease incentives are capitalised to investment properties. Amortisation of these items is then recognised as an expense in accordance with Australian Accounting
Standards. In accordance with the PCA Guidelines, amortisation of these items are excluded from FFO as:
— Static (non-development) lease incentives committed during the year relating to static centres are reflected within maintenance capital and static tenant leasing
costs within the AFFO calculation at Note 1(a); and
— Development lease incentives are included within the capital cost of the relevant development project.
3. Represents non-cash accounting adjustments as required by Australian Accounting Standards and are excluded from FFO.
4. Represents preliminary planning, marketing and tenant compensation which are development-related and therefore excluded from FFO.
c)
Reconciliation of segment income to total revenue
Refer to Note 2(b) for a reconciliation of total segment income to total revenue and income in the Statement of Comprehensive Income.
d)
Segment assets and liabilities
The property investment segment reported to the CODM includes investment properties held directly and those that are held
through equity accounted entities. A breakdown of the total investment properties in the property investment segment is shown
below. All other assets and liabilities are not allocated by segment for reporting to the CODM.
Note
30 Jun 24
$m
30 Jun 23
$m
Investment properties1,3
4(a)
14,552.1
13,880.5
Investment properties included in equity accounted investments2,3
160.0
501.7
Total interests in directly owned investment properties
14,712.1
14,382.2
1. Includes properties held for sale less investment property leaseholds and planning and holding costs.
2. Excludes planning and holding costs of $6.4 million (30 June 2023: $16.8 million) relating to investment properties included in equity accounted investments.
3. The residual interest in Chatswood Chase was acquired by the Group during the year. Consequently, the previously equity accounted investment, has been
classified as investment properties on transaction date and as at 30 June 2024. Further information on the transaction is disclosed in Notes 4(b) and 5(a).
101
Sustainability assurance
Securityholders
Directory
Communities
Suppliers
Climate and environment
Risks
Governance
Tax
Financial report
Operations
a)
Accounting policies
Property ownership revenue and income
The Group derives revenue and income in connection with the
leasing and operation of its portfolio of investment properties.
These comprise:
҅ Lease rental income
The Group derives lease rental income as a lessor from
leasing retail space within these investment properties. Lease
rental income is recognised on a straight-line basis over the
lease term except for non-lease components, predominantly
the recovery of certain operation and maintenance costs,
which is measured and recognised as revenue from contracts
with customers. Items included in the straight-lining
calculation are fixed rental payments, in-substance fixed
payments, lease incentives given to tenants and fixed rental
increases that form part of lease agreements. Variable rental
income is recognised as income in the period in which it is
earned. Lease rental income due over the remaining lease
term, which incorporates any future changes that vary the
original fixed lease payments, is accounted for as a lease
modification and recognised on a straight-line basis over
the remaining lease term.
҅ Revenue from recovery of property outgoings
Under certain tenant lease agreements, the Group recovers
from tenants a portion of costs incurred by the Group in
the operation and maintenance of its investment properties.
The Group, acting as principal, incurs these costs with third
party suppliers and includes them within direct property
expenses in the Statement of Comprehensive Income.
Recovery amounts are invoiced to tenants over time at
the start of each month for the provision of that month’s
services based on an annual estimate. Accordingly, where
recovery amounts are received in advance, no adjustment is
made for the effects of a financing component. Adjustments
to reflect recoveries based on actual costs incurred are
recorded within revenue in the Statement of Comprehensive
Income and billed annually.
҅ Other property related revenue
Other property related revenue includes fees earned
from advertising, carparking and the on selling of other
services at the Group’s shopping centres. The material
components of this revenue are recognised over time as the
relevant services are provided and relevant performance
obligations satisfied.
2. Revenue and income
Management fee revenue from strategic partnerships
These comprise:
҅ Property management fees
The Group manages retail investment properties on behalf
of its co-owners and other external parties. In connection
with the provision of these management services, the
Group derives fee revenue from:
› Ongoing retail investment property management. This is
recognised monthly (over time) as property management
services are provided. In accordance with the relevant
property management agreements, fee revenue is
calculated as a percentage of a property’s gross revenue
and income. Fees are invoiced and paid in the month the
service is provided.
› Tenant leasing management services. Fees are recognised
and invoiced at either the date of lease instruction or lease
execution (point in time) depending on the specific property
management agreement. Revenue is generally calculated
as a percentage of year one rental income achieved.
҅ Property development fees
The Group provides development management and
development leasing services to its co-owners and other
external parties. The Group accounts for all property
development services provided under these agreements as
a single performance obligation as all activities involved in
property development management are highly interrelated.
Property development fees are therefore calculated in
accordance with the relevant development agreement and
recognised over time on a time elapsed input method over
the life of the relevant development project.
҅ Funds management fees
The Group provides fund management services to wholesale
property funds and property mandates. Services are provided
on an ongoing basis and revenue is calculated and recognised
monthly (over time) as fund management services are
provided in accordance with the relevant fund constitutions.
People
Chairman/CEO letter
Highlights
Introduction
Operating and financial review
Sustainability
Customers
Vicinity Centres | 2024 Annual Report
102
2. Revenue and income (continued)
b)
Summary of revenue and income
A summary of the Group’s total revenue and income included within the Statement of Comprehensive Income by segment and
reconciliation to total segment income is shown below.
30 Jun 24
$m
30 Jun 23
$m
Property
investment
segment
Strategic
partnerships
segment
Total
Property
investment
segment
Strategic
partnerships
segment
Total
Recovery of property outgoings1,3
184.4
—
184.4
169.7
—
169.7
Other property related revenue1
113.6
—
113.6
112.2
—
112.2
Property management and
development fees2
—
67.1
67.1
—
61.9
61.9
Funds management fees2
—
0.7
0.7
—
2.9
2.9
Total revenue from contracts
with customers
298.0
67.8
365.8
281.9
64.8
346.7
Lease rental income1,3,4
951.4
—
951.4
927.9
—
927.9
Interest and other income
9.1
—
9.1
6.8
—
6.8
Total income
960.5
—
960.5
934.7
—
934.7
Total revenue and income
1,258.5
67.8
1,326.3
1,216.6
64.8
1,281.4
Reconciliation to segment income
Property-related expenses included in
segment income
(452.4)
(422.7)
Allowance for expected credit losses
0.2
21.5
Net property income from equity accounted
investments included in segment income
17.0
25.1
Straight-lining of rent adjustment
(6.5)
(2.8)
Amortisation of static lease incentives
and other project items
72.6
68.8
Interest and other revenue not
included in segment income
(9.1)
(10.6)
Total segment income
948.1
960.7
1. Included within ‘Property ownership revenue and income’ in the Statement of Comprehensive Income.
2. Included within ‘Management fee revenue from strategic partnerships’ in the Statement of Comprehensive Income.
3. Recovery of property outgoings includes estimated recoveries of property outgoings of gross and semi-gross deals, accounted for as revenue from contracts with
customers as the income is earned. The estimate is updated annually based on recoveries of property outgoings of net deals in the financial year.
4. Lease rental income includes percentage rent income of $27.4 million (30 June 2023: $32.8 million).
Operations
103
Sustainability assurance
Securityholders
Directory
Communities
Suppliers
Climate and environment
Risks
Governance
Tax
Financial report
3. Taxes
a)
Group taxation summary
Income tax
Vicinity Centres Trust (flow through trust structure)
The Trust and its controlled entities are not liable to pay income tax (including capital gains tax) on the basis that the taxable income
from the Trust’s property investments is taxed on a flow through basis in the hands of the Trust’s securityholders in accordance
with the Attribution Managed Investment Trust Regime. The Trust’s securityholders pay tax at their marginal tax rates, in the case of
Australian resident securityholders, or through the withholding rules that apply to non-resident securityholders investing in Managed
Investment Trusts. As a result, the Group has zero income tax expense recognised in respect of the Trust’s profit.
Vicinity Limited (corporate tax group)
The Company and its subsidiaries have formed a tax consolidated group (TCG). Under this arrangement, the Company, the head
entity of the TCG, accounts for its own current and deferred tax amounts and assumes those from subsidiaries in the TCG. Members
of the TCG have entered into a tax funding arrangement (TFA) which sets out the funding obligations of members of the TCG in
respect of tax amounts. The TFA requires payments to/from the head entity to be recognised via an inter-entity receivable/payable
which is at call.
Income tax expense for the year is calculated at the Australian corporate tax rate of 30% and comprises current and deferred tax
expense, any adjustments relating to current tax of prior periods and movements in unrecognised tax losses. These amounts are
recognised in the income statement, except to the extent they relate to items recognised directly in other comprehensive income or
equity. Current tax expense represents the expense relating to the expected taxable income at the applicable rate for the current
financial year.
Deferred tax assets and liabilities are measured based on the expected manner of recovery of the carrying value of an asset or
liability. Deferred tax charges represent the future tax consequences of recovering or settling the carrying amount of an asset or
liability. These future tax consequences are recorded as deferred tax assets, to the extent it is probable that future taxable profits will
be available to utilise them, or deferred tax liabilities. Where appropriate, deferred tax assets and liabilities are offset as required by
Australian Accounting Standards.
A summary of the components of Vicinity Limited’s income tax expense is shown below:
30 Jun 24
$m
30 Jun 23
$m
Current income tax expense
(3.9)
(4.3)
Deferred income tax benefit/(expense)
6.7
(0.4)
Adjustment for current year tax of prior periods
0.1
0.7
Increase in deferred tax assets
—
9.4
Income tax benefit
2.9
5.4
Statutory taxes and levies
The Group also incurs federal, state based and local authority taxes including land tax, council rates and levies. These are included within
direct property expenses in the Statement of Comprehensive Income. Additionally, employee benefits expense within the Statement of
Comprehensive Income includes employment-related taxes such as fringe benefits tax, payroll tax and Workcover contributions.
Goods and services tax
Revenues, expenses and assets are recognised net of the amount of Goods and Services Tax (GST) except:
҅ Where the GST incurred on a purchase of goods and services is not recoverable from the taxation authority, in which case the GST
is recognised as part of the cost of acquisition of the asset or as part of the expense item as applicable; and
҅ Receivables and payables, which are stated with the amount of GST included.
The net amount of GST recoverable from, or payable to, the taxation authority is included within the Balance Sheet. Cash flows are
included in the Cash Flow Statement on a gross basis and the GST component of cash flows arising from investing and financing
activities that is recoverable from, or payable to, the taxation authority is classified as part of operating cash flows. Commitments and
contingencies are disclosed net of the amount of GST recoverable from, or payable to, the taxation authority.
Voluntary tax transparency code
The Group is a signatory to the Tax Transparency Code. Further information on the Group’s statutory taxes, levies and GST are
disclosed in the Tax Transparency section of the Annual Report.
Operations
People
Chairman/CEO letter
Highlights
Introduction
Operating and financial review
Sustainability
Customers
Vicinity Centres | 2024 Annual Report
104
b)
Reconciliation between net profit and income tax benefit
30 Jun 24
$m
30 Jun 23
$m
Profit before tax for the year
544.2
266.1
Less: Profit attributed to the Trust and not subject to tax
(557.3)
(262.9)
Net (loss)/profit before tax attributable to securityholders of Vicinity Limited
(13.1)
3.2
Prima facie income tax benefit/(expense) at 30%
3.9
(1.0)
Tax effect of amounts not taxable in calculating income tax expense:
Net adjustment relating to permanent differences
(1.4)
(3.7)
Imputation credit on franked dividends
0.3
—
Prior period adjustments
0.1
0.7
Increase in deferred tax assets of previously unrecognised tax losses
—
9.4
Income tax benefit
2.9
5.4
c)
Movement in temporary differences
Significant judgement and estimate
The forecasts of future taxable income are based on the Group’s budgeting and planning process and tax related adjustments for the
Company. This process requires estimates to be made in developing assumptions about income and expenses in future periods and
significant judgement is applied in determining the length of the future time period to use in the assessment.
Key assumptions subject to uncertainty include future fund, property, and development management fee revenues, which are linked
to the underlying performance and valuation of the investment properties under management by the Company. Changes to the
assumptions, may result in reversal of deferred tax assets in future financial periods.
A summary of the movements in deferred tax balances is as follows:
Provisions
$m
Other
$m
Tax losses 1
$m
Total
$m
At 30 June 2022
24.4
0.4
44.5
69.3
Current tax expense
—
—
(4.3)
(4.3)
Adjustment for current year tax of prior periods
—
—
0.7
0.7
Deferred income tax movements
(2.9)
2.5
9.4
9.0
Transfers
0.1
—
(0.1)
—
At 30 June 2023
21.6
2.9
50.2
74.7
Current tax expense
—
—
(3.9)
(3.9)
Adjustment for current year tax of prior periods
—
(0.3)
0.4
0.1
Deferred income tax movements
(0.3)
7.0
—
6.7
At 30 June 2024
21.3
9.6
46.7
77.6
1. Unused tax losses do not expire. There were no unrecognised deferred tax assets of unused tax losses at 30 June 2024 (30 June 2023: nil).
3. Taxes (continued)
Operations
105
Sustainability assurance
Securityholders
Directory
Communities
Suppliers
Climate and environment
Risks
Governance
Tax
Financial report
4. Investment properties
The Group’s investment properties represent freehold and leasehold interests in land and buildings held either to derive rental
income or for capital appreciation, or both. They are initially measured at cost, including related transaction costs. Subsequently, at
each reporting period, they are carried at their fair values based on the market value, being the price that would be received to sell an
investment property in an orderly, arm’s length transaction between market participants at the reporting date.
Fair values for investment properties are determined by independent (external valuers) or internal valuations. These valuations include
the cost of capital works in progress on development projects.
a)
Portfolio summary
30 Jun 24
30 Jun 23
Shopping centre type
Number of
properties
Value 1
$m
Weighted
average
discount
rate 1,2
%
Weighted
average
capital-
isation
rate 1,2
%
Number of
properties
Value 1
$m
Weighted
average
discount
rate 1,2
%
Weighted
average
capital-
isation
rate 1,2
%
Super Regional
1
3,362.5
6.50
4.13
1
3,325.0
6.25
3.88
Major Regional3
7
2,270.2
7.02
5.91
7
1,945.3
6.94
6.16
Central Business Districts
7
1,968.2
6.75
5.36
7
1,965.7
6.52
5.14
Regional3
9
2,052.9
7.44
6.77
8
1,588.7
7.41
6.59
Outlet Centre
8
2,405.1
7.12
5.96
8
2,337.5
6.88
5.71
Sub Regional4
21
2,377.8
7.30
6.54
23
2,529.3
7.07
6.36
Neighbourhood
2
115.4
6.69
5.75
3
189.0
6.91
6.01
Planning and holding costs5
—
45.1
n/a
n/a
—
48.9
n/a
n/a
Total
55
14,597.2
6.98
5.65
57
13,929.4
6.78
5.47
Add: Investment
property leaseholds6
—
360.8
—
359.0
Less: Properties held for sale7
(3)
(186.6)
—
—
Total investment properties
52
14,771.4
57
14,288.4
1. The discount and capitalisation rates are used in the ‘discounted cash flow’ and ‘capitalisation of net income’ valuation methods respectively. The adopted fair
value is within the range calculated with reference to the two methods.
2. The discount and capitalisation rates relate to the core retail component excluding non-retail or ancillary properties.
3. As at 30 June 2024 Bayside was reassessed as meeting the requirements of a Regional centre and so has been reclassified from Major Regional to Regional.
4. Box Hill Central North is not included in the weighted average discount and capitalisation rates given the valuation for the property was based on the
‘project related site assessment’ method as disclosed in Note 4(c).
5. Planning and holding costs relating to planned major development projects are capitalised and carried within the overall investment property balance. The status
of each project is reviewed at each period end to determine if continued capitalisation of these costs remains appropriate.
6. Refer to Note 18(a) for further details of investment property leasehold balances.
7. Represents the carrying amount of Maddington Central, Halls Head Central and Karratha City which are classified as investment properties held for sale
(current asset), as the Group has entered into unconditional sale contracts as at 30 June 2024. These properties have been recorded at their fair value at balance
date, which approximated the selling price net of estimated purchase price adjustments.
b)
Movements for the year
As part of the Group’s continuing focus on enhancing the investment portfolio, the following investment property transactions have
occurred during the year:
Acquisition of the remaining 49% interest in Chatswood Chase
The Group completed the acquisition of the remaining 49% interest of Chatswood Chase on 15 March 2024, upon which the
investment property is consolidated. Further information of the transaction is disclosed in Note 5(a).
Asset divestments
The Group completed the following divestments (including transaction costs):
҅ Roxburgh Village in March 2024 for $120.6 million;
҅ Dianella Plaza in March 2024 for $74.8 million;
҅ Kurralta Central in February 2024 for $73.4 million; and
҅ Other ancillary property disposals at Broadmeadows Central, Ellenbrook Central, Whitsunday Plaza and Altona Gate totalling
$25.8 million.
Operations
People
Chairman/CEO letter
Highlights
Introduction
Operating and financial review
Sustainability
Customers
Vicinity Centres | 2024 Annual Report
106
4. Investment properties (continued)
b)
Movements for the year (continued)
A reconciliation of the movements in investment properties is shown in the table below.
30 Jun 24
$m
30 Jun 23
$m
Opening balance at 1 July
13,929.4
14,009.0
Acquisition (including landholder duty and transaction costs)1
376.6
—
Transfer from equity accounted investment1
373.3
—
Capital expenditure2
330.5
327.4
Capitalised borrowing costs3
7.7
3.4
Disposals
(294.6)
(148.4)
Property revaluation decrement for directly owned properties4
(41.9)
(196.0)
Landholder duty written off on acquisition of investment property
(17.7)
—
Amortisation of incentives and leasing costs5
(72.6)
(68.8)
Straight-lining of rent adjustment5
6.5
2.8
Closing balance at 30 June
14,597.2
13,929.4
1. The fair value of Chatswood Chase of $731.9 million on 15 March 2024, is reflected in the reconciliation as $376.6 million (including landholder duty and transaction
costs of $18.0 million) of residual interest acquired and $373.3 million of existing interest transferred from equity accounted investments (refer to Note 5).
2. Includes development and maintenance capital expenditure, lease incentives, fit-out, and other capital costs.
3. Borrowing costs incurred in the construction of qualifying assets have been capitalised at a weighted average rate of 4.9% (30 June 2023: 4.5%).
4. Excludes the property revaluation increment of $0.9 million (30 June 2023: increment of $0.1 million) of investment property leaseholds held at fair value,
and $2.1 million difference (gain) between transaction price and net fair value of Chatswood Chase.
5. For lease arrangements where Vicinity is the lessor.
Operations
c)
Portfolio valuation
Significant judgement and estimate
The Group’s valuation process is governed by the Board and
the internal management Investment and Capital Committee.
The process is reviewed periodically to consider changes in
regulatory and market conditions, and other requirements.
The determination of an investment property valuation requires
assumptions to be made which may not be based on observable
market data in all instances (i.e. discount and capitalisation rates)
and estimating the future impact of events such as subsequent
movements in inflation, interest rates, market rents and
regulatory changes. This means the valuation of an investment
property requires significant judgement and estimation.
Valuation process
The valuation process requires:
҅ Each property to be independently valued at least once
per year;
҅ Independent valuations prepared to assess the fair value of
each of the Group’s investment properties are conducted
in accordance with the guidelines and valuation principles
as set by the Australian Property Institute (API) and the
International Valuation Standards Council (IVSC). As part
of the valuation process, the Group has discussed the
impact of environmental, social and governance factors
with the independent valuers. In assessing the implications
of sustainability in property valuations under applicable API
guidelines and IVSC valuation standards, consideration is
given to environmental factors that can or do impact on the
valuation of an asset;
҅ Independent valuers (who are selected from a pre-approved
panel) that are appropriately qualified. Qualified independent
valuers must be authorised by law to carry out such valuations
and have at least five years’ valuation experience (including at
least two years in Australia) and have been rotated across all
properties at a minimum every three years. The pre-approved
panel was last approved in FY24;
҅ Internal valuations to be undertaken at the end of the
reporting period (half-year and year-end) if a property is not
due for an independent valuation;
҅ Where an internal valuation shows a variance greater than
10% from the last independent valuation, a new independent
valuation is undertaken (even if this results in a property being
independently valued twice in one year); and
҅ Internal valuations to be reviewed by a director of an
independent valuation firm to assess the reasonableness
of key assumptions and/or inputs adopted.
Variation to the valuation process, if approved by the Board,
could be made in certain circumstances such as imminent sale
of a property where a sale price has been agreed.
As at 30 June 2024, 24 assets were independently valued
(external) and 31 assets were valued internally (30 June 2023:
25 independent valuations and 32 internal valuations). Each
property in the portfolio however has been independently
valued at least once in the financial year, in-line with the Group’s
valuation process.
107
Sustainability assurance
Securityholders
Directory
Communities
Suppliers
Climate and environment
Risks
Governance
Tax
Financial report
4. Investment properties (continued)
c)
Portfolio valuation (continued)
Valuation methodology
To determine the fair value of investment properties as at 30 June 2024:
҅ Independent valuations commonly adopt a fair value within the range calculated with reference to the ‘capitalisation of net income’
and ‘discounted cash flow’ (DCF) methods;
҅ Internal valuations utilise the latest available property financial information in the ‘capitalisation of net income’ method and the
‘discounted cash flow’ method to arrive at a properties fair value;
҅ Both independent and internal valuations employ the ‘residual value’ method when valuing properties under development; and
҅ Where the fair value for a site is unlikely to be determined by the current usage at the site (i.e. not based on the cashflows
generated from the current usage such as retail), the valuer may employ a number of different methods to derive this valuation,
including a direct comparison of land value approach or a project related site assessment valuation (based on the highest and best
use for the site at any given time).
The table below details each valuation methodology:
Valuation method
Description
Capitalisation
of net income
The fully leased annual net income of the property is capitalised in perpetuity from the valuation date.
Except for leasehold properties where in most instances, depending on the term remaining on the ground
lease, the fully leased annual net income of the property is capitalised for the remaining ground lease
term. Various adjustments are then made to the calculated result, including estimated future incentives,
capital expenditure, vacancy allowances and reversions to market rent. The capitalisation rate reflects
the nature, location and tenancy profile of the property together with current market investment criteria,
as evidenced by current market transactions.
DCF
Projected cash flows for a selected investment period (usually 10 years) are derived from contracted
or future estimates of market rents, operating costs, lease incentives and capital expenditure.
The cash flows assume the property is sold at the end of the investment period (10 years) for a
terminal value. Terminal value is calculated by capitalising in perpetuity assumed market rent income at
the end of the investment period by an appropriate terminal yield, except for leasehold properties where
it may be calculated by other methodology to account for the finite term remaining on the ground lease
at that time.
Fair value is determined to be the present value of these projected cash flows, calculated by applying
a market-derived discount rate to the cash flows.
Residual value
(for properties
under development)
The value of the asset on completion is calculated using the capitalisation of net income and discounted
cash flow methods as described above, based on the forecast income profile at development completion.
The estimated cost to complete the development, including construction costs and associated expenditures,
finance costs, and an allowance for developer’s risk and profit, and post development stabilisation is
deducted from the value of the asset on completion to derive the current value.
Project related
site assessment
Where the fair (and highest) value of the asset is unlikely to be derived from the cashflows of its current
usage (e.g. retail), the valuation may have regard to a likely redevelopment of the site and the residual
value a purchaser may pay for the site today given a market accepted profit margin (determined by the
level of risk associated with developing the site).
Operations
People
Chairman/CEO letter
Highlights
Introduction
Operating and financial review
Sustainability
Customers
Vicinity Centres | 2024 Annual Report
108
4. Investment properties (continued)
c)
Portfolio valuation (continued)
Key assumptions and inputs
As the capitalisation of income and DCF valuation methods include key inputs that are not based on observable market data (namely
derived capitalisation and discount rates), investment property valuations are considered ‘Level 3’ on the fair value hierarchy (refer to
Note 24 for further details on the fair value hierarchy).
Key unobservable inputs used by the Group in determining the fair value of its investment properties are summarised below.
Unobservable inputs
30 Jun 24
30 Jun 23
Sensitivity
Range of inputs
Weighted
average
inputs
Range of inputs
Weighted
average
inputs
Capitalisation rate1
4.13% – 9.00%
5.65%
3.88% – 8.50%
5.47%
The higher the capitalisation rate,
discount rate, terminal yield, and
expected downtime due to tenants
vacating, the lower the fair value.
Discount rate2
6.25% – 9.00%
6.98%
6.25% – 8.75%
6.78%
Terminal yield3
4.38% – 7.75%
5.87%
4.13% – 8.00%
5.67%
Expected downtime
(for tenants vacating)
3 to 12 months
6 months
4 to 15 months
7 months
Market rental growth rate
2.17% – 3.59%
3.06%
2.00% – 3.69%
3.03%
The higher the assumed market rental
growth rate, the higher the fair value.
1. The capitalisation rate is the required annual yield of net market income used to determine the value of the property. The rate is determined with regards to
comparable market transactions.
2. The discount rate is a required annual total rate of return used to convert the forecast cash flow of an asset into present value terms. It should reflect the required
rate of return of the property given its risk profile relative to competing uses of capital. The rate is determined with regards to comparable market transactions.
3. The terminal yield is the capitalisation rate used to convert forecast annual income into a forecast asset value at the end of the holding period when carrying
out a DCF calculation. The rate is determined with regards to comparable market transactions and the expected risk inherent in the cash flows at the end of the
cash flow period. Leasehold properties with tenure less than 20 years (at the end of the 10-year investment horizon) have been excluded from this sensitivity for
comparative reasons given the terminal value calculation can differ to take into account the finite term remaining on the leasehold at that time.
All of the above key assumptions have been taken from the 30 June 2024 external valuation reports and internal valuation
assessments (where applicable).
For all investment properties except for Box Hill Central North, the current use is considered the highest and best use. For Box Hill
Central North, the highest and best use is a mixed-use development site.
Sensitivity analysis
The following sensitivities illustrate the impact of changes in key unobservable inputs (in isolation) on the fair value of the Group’s
investment properties as at 30 June 2024. Specific key unobservable inputs may impact only the capitalisation of net income method,
the DCF method or both methods.
DCF method
30 Jun 24
Carrying value
$m
Discount rate
-0.25%
$m
Discount rate
+0.25%
$m
10-year rental
growth rate
-0.25%
$m
10-year rental
growth rate
+0.25%
$m
Actual valuation1
14,365.5
Impact on actual valuation
+307.9
(293.3)
(217.3)
+220.8
Resulting valuation
14,673.4
14,072.2
14,148.2
14,586.3
1. Excludes planning and holding costs, investment property leaseholds and properties held for sale.
Capitalisation of net income method
30 Jun 24
Carrying value
$m
Capitalisation
rate
-0.25%
$m
Capitalisation
rate
+0.25%
$m
Actual valuation1
14,365.5
Impact on actual valuation
+698.7
(638.0)
Resulting valuation
15,064.2
13,727.5
1. Excludes planning and holding costs, investment property leaseholds and properties held for sale.
Operations
109
Sustainability assurance
Securityholders
Directory
Communities
Suppliers
Climate and environment
Risks
Governance
Tax
Financial report
4. Investment properties (continued)
d)
Future undiscounted lease payments to be received from operating leases
The Group’s investment properties are leased to tenants under operating leases with rentals payable monthly. Future minimum
undiscounted fixed lease payments to be received for the non-cancellable period of operating leases of investment properties are
shown in the table below. These include amounts to be received for recovery of property outgoings for tenants on gross leases which
will be accounted for as revenue from contracts with customers when earned1. Rentals which may be received when tenant sales
exceed set thresholds and separately invoiced amounts for recovery of property outgoings are excluded1.
30 Jun 24
$m
30 Jun 23
$m
Not later than one year
913.6
882.4
Two years
851.2
736.2
Three years
744.8
612.0
Four years
618.9
494.6
Five years
470.3
363.0
Later than five years
983.7
790.3
Total undiscounted lease payments to be received from operating leases
4,582.5
3,878.5
1. Refer to Note 2 for the proportion of revenue earned relating to the recovery of property outgoings.
5. Equity accounted investments
Equity accounted investments primarily consists of investment property joint ventures with strategic partners where the property
ownership interest is held through a jointly owned trust rather than direct ownership into the property title. The Group has
contractual arrangements that establish joint control over the economic activities of these trusts, based on standard market terms.
These investments are accounted for using the equity method.
a)
Summary of equity accounted investments
Ownership
Carrying value
30 Jun 24
%
30 Jun 23
%
30 Jun 24
$m
30 Jun 23
$m
Chatswood Chase (Joint Venture)1
—
51
—
342.8
Victoria Gardens Retail Trust (Joint Venture)2
50
50
91.4
93.7
91.4
436.5
Other associates
0.4
1.0
Closing balance
91.8
437.5
1. Investment in the Chatswood Chase joint venture is held through CC Commercial Trust (CCCT). In October 2023, the Group entered into agreements to acquire
the remaining 49% interest in CCCT. The transaction settled on 15 March 2024, for cash consideration of $331.6 million (including purchase price adjustments,
landholder duty and transaction costs). In the period up to settlement date, the contractual arrangements that established joint control over the economic
activities of CCCT remained substantively unchanged. As a result, the Group and its joint venture partner continued to have joint control over the relevant
activities of CCCT until 15 March 2024. On settlement completion, CCCT ceased to be a joint venture and the use of the equity method was discontinued.
The carrying value of the assets and liabilities of CCCT approximated its fair value on transaction date. The net assets of CCCT on transaction date were
predominantly made up of the fair value of Chatswood Chase of $731.9 million (reconciliation of the Chatswood Chase investment property is as disclosed in
Note 4(b)). In accordance with the accounting standards, the transaction is accounted for as an asset acquisition.
2. The primary asset of the joint venture is investment property held at fair value. As such the carrying value of equity accounted investment is subject to the same
significant judgement and estimate as disclosed in Note 4(c).
Operations
People
Chairman/CEO letter
Highlights
Introduction
Operating and financial review
Sustainability
Customers
Vicinity Centres | 2024 Annual Report
110
5. Equity accounted investments (continued)
b)
Movements for the year
A reconciliation of the movements in significant equity accounted investments is shown in the table below.
Note
30 Jun 24
$m
30 Jun 23
$m
Opening balance
436.5
503.9
Additional investments made during the year
9.1
3.0
Share of net loss of equity accounted investments1
(14.6)
(50.5)
Distributions of net income declared by equity accounted investments
(11.2)
(19.9)
Discontinuation of equity method of CCCT
(328.4)
-
Closing balance
5(a)
91.4
436.5
1. Excludes share of net gain from other associates of $0.3 million (30 June 2023: share of loss of $0.4 million).
c)
Summarised financial information of joint ventures
Chatswood Chase
Summarised financial information represents 51% of the underlying financial information for Chatswood Chase joint venture for the
period up to 15 March 2024 when the remaining 49% interest in CCCT was acquired.
30 Jun 24
$m
30 Jun 23
$m
Investment property (non-current)
—
353.5
Other net working capital balances
—
(10.7)
Net assets
—
342.8
Total revenue and income
14.6
23.5
Aggregate net loss after income tax
(15.0)
(57.1)
Victoria Gardens Retail Trust
Summarised financial information represents 50% of the underlying financial information of the Victoria Gardens Retail Trust joint venture.
30 Jun 24
$m
30 Jun 23
$m
Investment property (non-current)
166.4
165.0
Interest bearing liability (non-current)
(68.9)
(68.6)
Other net working capital balances
(6.1)
(2.7)
Net assets
91.4
93.7
Total revenue and income
11.0
10.4
Interest expense
(3.2)
(2.7)
Aggregate net profit after income tax
0.4
6.5
d)
Related party transactions with equity accounted investments during the year
Chatswood Chase
Asset management fees earned by the Group for management services provided to Chatswood Chase for the period to 15 March 2024
totalled $13,145,000 (30 June 2023: $5,728,000). At 30 June 2024, no amounts remain payable to the Group (30 June 2023: nil).
Distribution income from the Group’s investment in Chatswood Chase for the period to 15 March 2024 was $8,451,000
(30 June 2023: $16,583,000) with nil remaining receivable to the Group at 30 June 2024 (30 June 2023: $8,749,000).
Victoria Gardens Retail Trust
Asset management fees earned by the Group for management services provided to Victoria Gardens Retail Trust totalled $2,226,000
(30 June 2023: $2,343,000). At 30 June 2024, no amounts remain payable to the Group (30 June 2023: nil). Distribution income
from the Group’s investment in Victoria Gardens Retail Trust was $2,754,000 (30 June 2023: $3,310,000) with $8,242,000
remaining receivable at 30 June 2024 (30 June 2023: $5,488,000).
Operations
111
Sustainability assurance
Securityholders
Directory
Communities
Suppliers
Climate and environment
Risks
Governance
Tax
Financial report
6. Earnings per security
The basic and diluted earnings per security for the Group are calculated below in accordance with the requirements of AASB 133
Earnings per Share.
Basic earnings per security is determined by dividing the net profit or loss after income tax by the weighted average number of
securities outstanding during the year.
Diluted earnings per security adjusts the weighted average number of securities outstanding by the weighted average number of
additional securities that would have been outstanding assuming the conversion of all dilutive potential securities.
Basic and diluted earnings per security are as follows:
30 Jun 24
30 Jun 23
Earnings per security attributable to securityholders of the Group:
Basic earnings per security (cents)
12.02
5.96
Diluted earnings per security (cents)
11.99
5.95
Earnings per security attributable to securityholders of Vicinity Limited:
Earnings per security (cents)
(0.22)
(0.02)
Diluted earnings per security (cents)
(0.22)
(0.02)
The following net profit after income tax amounts are used as the numerator in calculating earnings per stapled security of the Group
and Vicinity Limited:
30 Jun 24
$m
30 Jun 23
$m
Earnings used in calculating basic and diluted earnings per security of the Group
547.1
271.5
Earnings used in calculating basic and diluted earnings per security of Vicinity Limited
(10.2)
(0.8)
The following weighted average number of securities are used as the denominator in calculating earnings per stapled security of the
Group and Vicinity Limited:
30 Jun 24
Number (m)
30 Jun 23
Number (m)
Weighted average number of securities used as the denominator in calculating basic earnings
per security
4,552.3
4.552.3
Adjustment for potential dilution from performance and restricted rights
10.2
8.3
Weighted average number of securities used as the denominator in calculating diluted earnings
per security
4,562.5
4,560.6
Operations
People
Chairman/CEO letter
Highlights
Introduction
Operating and financial review
Sustainability
Customers
Vicinity Centres | 2024 Annual Report
112
7. Interest bearing liabilities and derivatives
Interest bearing liabilities are initially recognised at fair value, net of transaction costs incurred and subsequently measured at
amortised cost using the effective interest rate method. Foreign currency denominated notes are translated to AUD at the applicable
exchange rate at each reporting period with the gain or loss attributable to exchange rate movements recognised in the Statement of
Comprehensive Income.
a)
Summary of facilities
The following table outlines the Group’s interest bearing liabilities at balance date:
30 Jun 24
$m
30 Jun 23
$m
Current liabilities
Unsecured
Bank debt
—
123.0
AUD Medium Term Notes (AMTN)
400.0
200.0
US Private Placement Notes (USPP)
87.5
—
Total current liabilities
487.5
323.0
Non-current liabilities
Unsecured
Bank debt
318.0
330.0
AMTN1
1,059.4
958.8
GBP European Medium Term Notes (GBMTN)
666.5
665.6
HKD European Medium Term Notes (HKMTN)
122.9
122.5
USPP
783.6
868.4
EUR European Medium Term Notes (EMTN)
803.9
815.3
Deferred debt costs2
(11.6)
(10.1)
Total non-current liabilities
3,742.7
3,750.5
Total interest bearing liabilities
4,230.2
4,073.5
1. Non-current unsecured AMTN includes $60.0 million of AUD notes issued under the Group’s EMTN program, $300.0 million of Green Bond and $500.0 million
10 year AUD Bond issued in April 2024. The proceeds of Green Bonds were utilised to fund eligible green projects and assets with high sustainability rating (e.g.
National Australian Built Environment Rating system energy rating of 5 stars or higher).
2. Deferred debt costs comprise the unamortised value of borrowing costs paid on establishment or refinancing of debt facilities. These costs are deferred on the
Balance Sheet and amortised at the effective interest rate to borrowing costs in the Statement of Comprehensive Income.
Capital structure and financial risk management
113
Sustainability assurance
Securityholders
Directory
Communities
Suppliers
Climate and environment
Risks
Governance
Tax
Financial report
7. Interest bearing liabilities and derivatives (continued)
Capital structure and financial risk management
b)
Facility maturity and availability
The charts below outline the maturity of the Group’s total available facilities at 30 June 2024 by type, and the bank to capital markets
debt ratio. Of the $5,421.0 million total available facilities (30 June 2023: $5,146.0 million), $1,332.0 million remains undrawn at
30 June 2024 (30 June 2023: $1,222.0 million).
1. The carrying amount of the USPP, GBMTN, HKMTN, EMTN and AMTN on the Balance Sheet is net of adjustments for fair value items and foreign exchange
translation losses of $152.8 million (30 June 2023: losses of $159.6 million). These adjustments are excluded from the calculation of total facilities available and
amounts drawn as shown in the charts. Additionally, deferred debt costs of $11.6 million (30 June 2023: $10.1 million) are not reflected in the amount drawn.
Bank to capital market debt ratio ($m,%)
$1,650.0
30%
$3,771.0
70%
Capital market debt outstanding
Bank Debt facility limit
Available facilities expiry profile ($m)1
93.0
132.0
309.0
60.0
655.2
FY26
475.0
200.0
FY27
75.0
400.0
83.8
300.0
108.2
FY28
150.0
275.0
FY29
812.3
FY30
169.4
FY31
FY32
FY33
USPP
GBMTN
HKMTN
Bank debt drawn
Bank debt undrawn
AMTN
EMTN
50.0
58.9
400.0
FY25
500.0
FY34
114.2
c)
Borrowing costs
Borrowing costs consist of interest and other costs incurred in connection with borrowing funds (such as establishment fees, legal
and other fees). Borrowing costs are expensed to the Statement of Comprehensive Income using the effective interest rate method,
except for borrowing costs incurred for the development of qualifying investment properties which are capitalised to the cost of the
investment property during the period of development. Borrowing costs also include finance charges on lease liabilities.
30 Jun 24
$m
30 Jun 23
$m
Interest and other costs on interest bearing liabilities and derivatives
191.1
174.6
Amortisation of deferred debt costs
4.5
4.3
Amortisation of face value discounts
1.6
1.6
Amortisation of fair value adjustments relating to discontinuation of hedge accounting
(1.5)
(1.3)
Interest charge on lease liabilities
29.2
28.9
Capitalised borrowing costs
(8.4)
(3.4)
Total borrowing costs
216.5
204.7
People
Chairman/CEO letter
Highlights
Introduction
Operating and financial review
Sustainability
Customers
Vicinity Centres | 2024 Annual Report
114
7. Interest bearing liabilities and derivatives (continued)
Capital structure and financial risk management
d)
Defaults and covenants
At 30 June 2024, the Group had no defaults on debt obligations or breaches of lending covenants (30 June 2023: nil).
e)
Derivatives
As detailed further in Note 8, derivative instruments are held to hedge against the interest rate and foreign currency risks of the
Group’s borrowings. These are not accounted for under hedge accounting. Derivatives are initially recognised at fair value and
subsequently remeasured to their fair value at each reporting period. The fair value of these derivatives is estimated using valuation
techniques, including referencing to the current fair value of other instruments that are substantially the same or calculation of
discounted cash flows. These valuation techniques use observable Level 2 inputs, mainly interest rates and interest rate curves as
well as foreign currency rates and foreign currency curves. The Group does not currently have a legally enforceable right to set-off
the derivative assets and liabilities. As such, the derivatives are presented on a gross basis.
The following are recorded within the Statement of Comprehensive Income in respect of derivative financial instruments:
҅ Movements in fair value are recognised within net mark-to-market movement on derivatives; and
҅ The net interest received or paid is included within borrowing costs.
The classification of derivatives is presented based on the net cash outflows expected to be settled (or net cash inflows expected to
be realised) within 12 months in determining the current liability (or current asset). A derivative contract is considered a single unit of
account, therefore when the overall derivative’s fair value is a liability (asset), any net cash inflows (outflows) within 12 months are not
separately presented.
The carrying amount and notional principal amounts of these instruments are shown in the table below:
30 Jun 24
Notional
principal amount
$m
Carrying amount
Current
asset
$m
Non-current
asset
$m
Current
liability
$m
Non-current
liability
$m
Cross currency swaps (pay AUD floating receive USD fixed)
660.3
28.5
67.5
(2.0)
(2.8)
Cross currency swaps (pay AUD floating receive GBP fixed)
655.2
—
—
(19.8)
(9.5)
Cross currency swaps (pay AUD floating receive HKD fixed)
108.2
—
9.8
—
—
Cross currency swaps (pay AUD floating receive EUR fixed)
812.3
—
—
(38.8)
(84.5)
Interest rate swaps (fixed to floating)1
2,425.0
39.5
102.9
—
(0.4)
Interest rate swaps (floating to fixed)
500.0
—
4.4
—
—
Total carrying amount of derivative financial instruments
n/a
68.0
184.6
(60.6)
(97.2)
30 Jun 23
Notional
principal amount
$m
Carrying amount
Current
asset
$m
Non-current
asset
$m
Current
liability
$m
Non-current
liability
$m
Cross currency swaps (pay AUD floating receive USD fixed)
660.3
—
87.5
(2.2)
(5.2)
Cross currency swaps (pay AUD floating receive GBP fixed)
655.2
—
—
(18.8)
(47.8)
Cross currency swaps (pay AUD floating receive HKD fixed)
108.2
—
7.9
—
—
Cross currency swaps (pay AUD floating receive EUR fixed)
812.3
—
—
(38.3)
(95.9)
Interest rate swaps (fixed to floating)1
2,425.0
39.1
132.2
—
—
Total carrying amount of derivative financial instruments
n/a
39.1
227.6
(59.3)
(148.9)
1. Notional value excludes the $1,200.0 million swaps with forward start dates between August 2024 and September 2025 (30 June 2023: $300.0 million). The fair
value of these forward start contracts has been included in the carrying amount of interest rate swaps at 30 June 2024.
115
Sustainability assurance
Securityholders
Directory
Communities
Suppliers
Climate and environment
Risks
Governance
Tax
Financial report
Capital structure and financial risk management
f)
Changes in interest bearing liabilities arising from financing activities
The table below details changes in the Group’s interest bearing liabilities arising from financing activities, including both cash and non-
cash changes:
30 Jun 24
$m
30 Jun 23
$m
Opening balance
4,073.5
3,752.5
New AMTN issue
500.0
—
Repayment of AMTN
(200.0)
—
Net (repayment)/drawdowns of bank debt
(135.0)
180.0
Foreign exchange rate adjustments recognised in profit and loss
(6.9)
139.9
Payment of deferred debt costs
(6.0)
(3.5)
Amortisation of face value discount
1.6
1.6
Amortisation of deferred debt costs
4.5
4.3
Fair value movements, non-cash
(1.5)
(1.3)
Closing balance
4,230.2
4,073.5
g)
Fair value of interest bearing liabilities
As at 30 June 2024 the Group’s interest bearing liabilities had a fair value of $4,050.0 million (30 June 2023: $3,759.3 million).
The carrying amount of these interest bearing liabilities was $4,230.2 million (30 June 2023: $4,073.5 million). The difference
between the carrying amount and the fair value of interest bearing liabilities is due to:
҅ Deferred debt costs included in the carrying value which are not included in the fair value; and
҅ Movements in market discount rates on interest bearing liabilities since initial recognition. As fair value is calculated by discounting
the contractual cash flows using prevailing market discount rates (with similar terms, maturity and credit quality) any movements
in these discount rates since initial recognition will give rise to differences between fair value and the carrying value (which is at
amortised cost).
Had the interest bearing liabilities been recognised at fair value, these would have been classified as Level 2 under the fair value
hierarchy as the market discount rates used are indirectly observable.
8. Capital and financial risk management
In the course of its operations the Group is exposed to certain financial risks that could affect the Group’s financial position and
performance. This note explains the sources of the risks below, how they are managed by the Group and exposure at reporting date:
҅ Interest rate risk, Note 8(a);
҅ Foreign exchange risk, Note 8(b);
҅ Liquidity risk, Note 8(c); and
҅ Credit risk, Note 8(d).
Information about the Group’s objectives for managing capital is contained in Note 8(e).
Risk management approach
The Group’s treasury team is responsible for the day to day management of the Group’s capital requirements and the financial risks
identified above. These activities are overseen by the internal management Capital Management Committee (CMC), operating under
the CMC Charter and the treasury policy. This policy is endorsed by the Audit Committee and approved by the Board. The overall
objectives of the CMC are to:
҅ Ensure that the Group has funds available to meet all financial obligations, working capital and committed capital expenditure
requirements;
҅ Monitor and ensure compliance with all relevant financial covenants and other undertakings under the Group’s debt facilities;
҅ Reduce the impact of adverse interest rate or foreign exchange movements on the Group’s financial performance and position
using approved financial instruments;
҅ Diversify banking counterparties to mitigate counterparty credit risk; and
҅ Ensure the Group treasury team operates in an appropriate control environment, with effective systems and procedures.
7. Interest bearing liabilities and derivatives (continued)
People
Chairman/CEO letter
Highlights
Introduction
Operating and financial review
Sustainability
Customers
Vicinity Centres | 2024 Annual Report
116
Capital structure and financial risk management
a)
Interest rate risk
Nature and sources of risk
Interest rate risk represents the potential for changes in market interest rates to impact the total interest expense on floating rate
borrowings (cash flow interest rate risk) or the fair value of derivatives (fair value interest rate risk) held by the Group.
Risk management
Interest rate swaps are used to manage cash flow interest rate risk by targeting a hedge ratio on the Group’s interest-bearing
liabilities. Under the terms of the interest rate swaps, the Group agrees to exchange, at specified intervals, amounts based on the
difference between fixed interest rates and the floating market interest rate calculated by reference to an agreed notional principal
amount. None of these derivatives are currently in designated hedge relationships. They are also not permitted to be entered into for
speculative purposes.
Exposure
As at the balance date, the Group had the following exposure to cash flow interest rate risk:
Note
30 Jun 24
$m
30 Jun 23
$m
Total interest bearing liabilities
7(a)
4,230.2
4,073.5
Reconciliation to drawn debt
Deferred debt costs
11.6
10.1
Fair value and foreign exchange adjustments to EMTN
8.4
(3.0)
Fair value and foreign exchange adjustments to GBMTN
(11.2)
(10.4)
Fair value and foreign exchange adjustments to USPP
(135.9)
(133.1)
Fair value adjustments to AMTN
0.6
1.2
Foreign exchange adjustments to HKMTN
(14.7)
(14.3)
Total drawn debt
4,089.0
3,924.0
Less: Fixed rate borrowings
(1,300.0)
(1,000.0)
Variable rate borrowings exposed to cash flow interest rate risk
2,789.0
2,924.0
Less: Notional principal of outstanding interest rate swap contracts
(1,925.0)
(2,425.0)
Net variable rate borrowings exposed to cash flow interest rate risk
864.0
499.0
Hedge ratio1
78.9%
87.3%
1. Calculated as net variable rate borrowings exposed to cash flow interest rate risk divided by total drawn debt.
Sensitivity
A shift in the floating interest rate of +/- 50 bps, assuming the net exposure to cash flow interest rate risk as at 30 June 2024 remains
unchanged for the next 12 months, would impact the Group’s cash interest cost for the next 12 months by $4.3 million (30 June 2023
+/- 50 bps: $2.5 million).
A shift in the forward interest rate curve of +/- 50 bps, assuming the net exposure to fair value interest rate risk as at 30 June 2024
remains unchanged for the next 12 months, would impact net profit and equity for the next 12 months by $7.8 million (30 June 2023
+/- 50 bps: $10.4 million).
This sensitivity analysis should not be considered a projection.
8. Capital and financial risk management (continued)
117
Sustainability assurance
Securityholders
Directory
Communities
Suppliers
Climate and environment
Risks
Governance
Tax
Financial report
8. Capital and financial risk management (continued)
b)
Foreign exchange rate risk
Nature and sources of risk
Foreign exchange risk represents the potential for changes in market foreign exchange rates to impact the cash flows arising from the
Group’s foreign denominated interest bearing liabilities (cash flow foreign exchange rate risk) or the fair value of derivatives and the
carrying value of interest bearing liabilities (fair value foreign exchange rate risk) held by the Group.
Risk management
Cash flow foreign exchange rate risk is managed through the use of cross currency swaps, which swap the foreign currency interest
payments on foreign denominated interest bearing liabilities into Australian dollars and fix the exchange rate for the conversion of
the principal repayment. None of these derivatives are currently in designated hedge relationships. They are also not permitted to be
entered into for speculative purposes.
Exposure
As at the balance date, the Group had entered into cross currency swaps with terms offsetting those of all foreign denominated
interest bearing liabilities and therefore had no significant net exposure to cash flow foreign exchange rate risk (30 June 2023: nil net
exposure). The Group has exposure to fair value foreign exchange risk on the valuation of the derivative financial instruments. The
table below summarises the foreign denominated interest bearing liabilities held by the Group. Details of cross currency swaps held
are shown in Note 7(e).
Foreign denominated interest bearing liabilities
Foreign
currency
30 Jun 24
$m
30 Jun 23
$m
GBMTN
GBP £
350.0
350.0
HKMTN
HKD $
640.0
640.0
USPP
USD $
523.0
523.0
EMTN
EUR €
500.0
500.0
Sensitivity
A shift in the forward GBP, HKD, EUR and USD exchange rate curves of +/- 5.0 cents, assuming the net exposure to fair value foreign
exchange rate risk as at 30 June 2024 remains unchanged for the next 12 months, would impact net profit and equity for the next 12
months by $5.3 million (30 June 2023 +/- 5.0 cents: $10.6 million).
This sensitivity analysis should not be considered a projection.
Capital structure and financial risk management
People
Chairman/CEO letter
Highlights
Introduction
Operating and financial review
Sustainability
Customers
Vicinity Centres | 2024 Annual Report
118
8. Capital and financial risk management (continued)
c)
Liquidity risk
Nature and sources of risk
Liquidity risk represents the risk that the Group will be unable to meet financial obligations as they fall due.
Risk management
To manage this risk, sufficient capacity under the Group’s financing facilities is maintained to meet the funding needs identified in
the Group’s latest forecasts. This is achieved through obtaining and maintaining funding from a range of sources (e.g. banks and
Australian and foreign debt capital markets), maintaining sufficient undrawn debt capacity and cash balances, and managing the
amount of borrowings that mature, or facilities that expire, in any one year.
Exposure
The contractual maturity of cash on term deposit, interest bearing liabilities and the interest payment profile on interest bearing
liabilities and derivatives are shown below. Estimated interest and principal payments are calculated based on the forward interest
and foreign exchange rates prevailing at year end and are undiscounted. Timing of payments is based on current contractual
obligations. Refer to Note 12 for details on trade payables and other financial liabilities and Note 18(b) for lease liabilities that are not
included in the table below.
30 Jun 24
Less than
1 year
$m
1 to 3 years
$m
Greater than
3 years
$m
Total
$m
Bank debt
—
93.0
225.0
318.0
AMTN
400.0
200.0
800.0
1,400
GBMTN
—
665.7
—
665.7
HKMTN
—
—
126.8
126.8
USPP
87.5
336.0
442.7
866.2
EMTN
—
60.0
882.6
942.6
Estimated interest payments and line fees on borrowings
166.4
236.0
332.2
734.6
Estimated net interest rate swap cash (inflows)
(42.2)
(61.0)
(64.0)
(167.2)
Estimated gross cross currency swap cash outflows
199.5
1,156.8
1,374.8
2,731.1
Estimated gross cross currency swap cash (inflows)
(152.1)
(1,086.7)
(1,442.1)
(2,680.9)
Total contractual outflows
659.1
1,599.8
2,678.0
4,936.9
30 Jun 23
Less than
1 year
$m
1 to 3 years
$m
Greater than
3 years
$m
Total
$m
Bank debt1
123.0
105.0
225.0
453.0
AMTN
200.0
460.0
500.0
1,160.0
GBMTN
—
648.1
—
648.1
HKMTN
—
—
127.3
127.3
USPP
—
423.6
450.3
873.9
EMTN
—
—
910.0
910.0
Estimated interest payments and line fees on borrowings
144.5
228.4
162.6
535.5
Estimated net interest rate swap cash (inflows)
(43.1)
(67.8)
(88.1)
(199.0)
Estimated gross cross currency swap cash outflows
143.3
1,283.7
1,443.2
2,870.2
Estimated gross cross currency swap cash (inflows)
(66.2)
(1,192.7)
(1,507.6)
(2,766.5)
Total contractual outflows
501.5
1,888.3
2,222.7
4,612.5
1. Repayment of $123.0 million of bank debt made in July 2023, following the sale of 50% interest in Broadmeadows Central.
Capital structure and financial risk management
119
Sustainability assurance
Securityholders
Directory
Communities
Suppliers
Climate and environment
Risks
Governance
Tax
Financial report
d)
Credit risk
Nature and sources of risk
Credit risk is the risk that a tenant or counterparty to a financial asset held by the Group fails to meet their financial obligations. The
Group’s financial assets that are subject to credit risk are bank deposits, tenant receivables and derivative financial assets.
Risk management
To mitigate credit risk in relation to derivative counterparties and bank deposits the Group has policies to limit exposure to any one
financial institution and only deal with those parties with high credit quality. To mitigate tenant credit risk, an assessment is performed
taking into consideration the financial background of the tenant and the amount of any security deposit or bank guarantee provided
as collateral under the lease, as is usual in leasing agreements. On an ongoing basis, trade receivable balances from tenants are
monitored with the Group considering receivables that have not been paid for 30 days after the invoice date as past due. Note 11
discusses the assessment of credit risk on tenant receivables at 30 June 2024.
Exposure
The maximum exposure to credit risk at the balance date is the carrying amount of the Group’s financial assets which are recognised
within the Balance Sheet net of allowance for losses. As at balance date, there are no significant concentrations of credit risk with any
tenant or tenant group.
e)
Capital management
The Group seeks to maintain a strong and conservative capital structure with appropriate liquidity, low gearing and a diversified debt
profile (by source and tenor). The Group has credit ratings of ‘A2/stable’ from Moody’s Investors Service and ‘A/stable’ from Standard
& Poor’s (S&P) Global Ratings.
Key metrics monitored are gearing ratio and interest cover ratio. These metrics are shown below.
Gearing ratio
The gearing ratio is calculated in the table below as:
҅ Total drawn debt net of cash; divided by
҅ Total tangible assets excluding cash, right of use assets, net investments in lease, investment property leaseholds and derivative
financial assets.
Note
30 Jun 24
$m
30 Jun 23
$m
Total drawn debt
8(a)
4,089.0
3,924.0
Drawn debt net of cash
4,039.4
3,731.1
Total tangible assets excluding cash, right of use assets, net investments in lease,
investment property leaseholds and derivative financial assets
14,872.4
14,577.2
Gearing ratio (target range of 25.0% to 35.0%)
27.2%
25.6%
Interest cover ratio
The interest cover ratio is calculated in accordance with the definitions within the Group’s bank debt facility agreements as follows:
҅ EBITDA which generally means the Group’s earnings before interest, tax, depreciation, amortisation, fair value adjustments and
other items; divided by
҅ Total interest expense.
The interest cover ratio was 4.2 times at 30 June 2024 (30 June 2023: 4.6 times).
8. Capital and financial risk management (continued)
Capital structure and financial risk management
People
Chairman/CEO letter
Highlights
Introduction
Operating and financial review
Sustainability
Customers
Vicinity Centres | 2024 Annual Report
120
An ordinary stapled security comprises one share in the Company and one unit in the Trust. Ordinary stapled securities entitle
the holder to participate in distributions and the proceeds on winding up of the Group (if enacted) in proportion to the number of
securities held. Ordinary stapled securities are classified as equity. All ordinary securities are fully paid.
Incremental costs directly attributable to the issue of new stapled securities are shown in equity as a deduction, net of tax, from
the proceeds. Incremental costs directly attributable to the issue of new stapled securities for the acquisition of a business are not
included in the cost of the acquisition as part of the purchase consideration.
30 Jun 24
Number (m)
30 Jun 23
Number (m)
30 Jun 24
$m
30 Jun 23
$m
Total stapled securities on issue at the beginning of the year
4,552.3
4,552.3
9,102.2
9,102.2
Total stapled securities on issue at the end of the year
4,552.3
4,552.3
9,102.2
9,102.2
The Group held 0.3 million or $0.5 million of treasury securities at 30 June 2024 (30 June 2023: 1.0 million shares or $1.8 million).
These will be used to settle employee share based payment plans.
10. Distributions
A provision is recognised for distributions to securityholders that have been declared by 30 June 2024 but remain unpaid by that date.
a)
Distributions for the year
30 Jun 24
Cents 1
30 Jun 23
Cents 1
30 Jun 24
$m
30 Jun 23
$m
Distributions paid/payable in respect of the earnings:
For six-months to 30 June 2024 (30 June 2023)
5.90
6.25
268.6
284.5
For six-months to 31 December 2023 (31 December 2022)
5.85
5.75
266.3
261.8
Total distributions for the year
11.75
12.00
534.9
546.3
1. Cents per VCX stapled security.
An interim distribution of 5.85 cents per VCX stapled security, which equates to $266.3 million, was paid on 7 March 2024.
On 20 August 2024, the Directors declared a distribution in respect of the Group’s earnings for the six-months to 30 June 2024
of 5.90 cents per VCX stapled security, which equates to final distribution of $268.6 million. The final distribution will be paid on
16 September 2024.
b)
Distributions paid during the year
30 Jun 24
Cents 1
30 Jun 23
Cents 1
30 Jun 24
$m
30 Jun 23
$m
Distributions paid in respect of the earnings:
For six-months to 31 December 2023 (31 December 2022)
5.85
5.75
266.3
261.8
For six-months to 30 June 2023 (30 June 2022)
6.25
5.70
284.5
259.5
Total distributions paid during the year
12.10
11.45
550.8
521.3
1. Cents per VCX stapled security.
9. Contributed equity
Capital structure and financial risk management
121
Sustainability assurance
Securityholders
Directory
Communities
Suppliers
Climate and environment
Risks
Governance
Tax
Financial report
a)
Summary
Trade receivables comprise amounts due from tenants of the Group’s investment properties under lease agreements and amounts
receivable from strategic partners under property management agreements.
Trade receivables and other assets are held to collect contractual cash flows. Trade receivables and other assets are initially
recognised at the transaction price or fair value and subsequently measured at amortised cost using the effective interest rate
method, less an allowance for expected credit losses (ECL). Trade receivables and other assets with maturities greater than 12 months
after the reporting date are classified as non-current assets.
At 30 June 2024, the carrying value of trade receivables and other assets approximated their fair value.
Note
30 Jun 24
$m
30 Jun 23
$m
Current trade receivables
Trade debtors
8.8
21.1
Deferred rent1
1.1
2.3
Accrued income
27.9
29.8
Receivables from strategic partners
0.5
2.6
Less: allowance for ECL
11(b)
(6.2)
(7.5)
Total current trade receivables2
32.1
48.3
Current other assets
Distributions receivable from joint ventures and associates
8.2
14.2
Prepayments
20.5
18.4
Land tax levies
15.8
17.7
Tenant security deposits held
0.6
1.2
Other
17.2
24.7
Total current other assets
62.3
76.2
Total current trade receivables and other assets
94.4
124.5
Non-current other assets
Deferred rent1
—
1.0
Less: allowance for ECL
11(b)
—
(0.1)
Other
8.4
6.8
Total non-current other assets
8.4
7.7
1. Under certain rent assistance agreements, rents are deferred to be repaid at a later date.
2. Include receivables relating to lease rental income, recovery of property outgoings and other property-related revenues. Refer to Note 2 for an analysis of the
Group’s revenue and income.
11. Trade receivables and other assets
Working capital
People
Chairman/CEO letter
Highlights
Introduction
Operating and financial review
Sustainability
Customers
Vicinity Centres | 2024 Annual Report
122
Working capital
11. Trade receivables and other assets (continued)
b)
Allowance for expected credit losses
The ECL allowance represents the difference between cash flows contractually receivable by the Group and the cash flows the
Group expects to receive. For trade receivables, contract assets and lease receivables, the Group applies the simplified approach
in calculating ECL. Therefore, the Group does not track the changes in credit risk, but instead recognises a loss allowance based on
lifetime ECL at each reporting date.
Tenant debt is segmented according to the risk profiles and age of the outstanding debt. ECL of these segments are then assessed
with reference to the tenants’ financial position, historical credit losses, and other macroeconomic factors.
The recognition of an ECL, however, does not mean that the Group has ceased collection activities in relation to the amounts owed.
Tenant debt is considered to be in default if contractual payments have not been made when they fall due and is written off when
collections are unlikely.
As at 30 June 2024, $3.5 million, which represents approximately 35.5% of total trade receivables, is considered past due but not
impaired (30 June 2023: $9.9 million which represents 40.6% of total trade receivables).
Movements in the allowance for ECL
The movement in the allowance for ECL in respect of trade receivables during the year was as follows:
30 Jun 24
$m
30 Jun 23
$m
Opening balance at 1 July
(7.6)
(76.8)
Amounts written off as uncollectible
3.6
31.7
Rental waivers granted
1.8
18.4
Net remeasurement of prior period allowance1,2
4.4
27.1
Loss allowance on receivables originated during the current period2
(7.1)
(8.0)
Transferred from equity accounted investment
(1.3)
—
Closing balance at 30 June
(6.2)
(7.6)
1. The opening balance of allowance for ECL at 1 July was remeasured due to changes to key assumptions adopted previously.
2. Included within ‘allowance for ECL’ in the Statement of Comprehensive Income. A further $2.9 million (30 June 2023: 2.4 million) recovery of previously written
off trade receivables, was recognised directly in allowance for ECL in the Statement of Comprehensive Income.
12. Payables and other financial liabilities
Payables and other financial liabilities represent liabilities for goods and services provided to the Group prior to the end of the
financial year and that are unpaid. The amounts are unsecured and are usually paid within 30 days of recognition. Trade and other
payables are carried at amortised cost and are not discounted due to their short-term nature.
At 30 June 2024, the carrying value of payables and other financial liabilities approximated their fair value.
30 Jun 24
$m
30 Jun 23
$m
Trade payables and accrued expenses
127.1
109.9
Lease rental income and property outgoings recovery revenue received in advance1
20.2
29.2
Accrued interest expense
29.0
21.7
Accrued capital expenditure
42.6
27.4
Security deposits
1.1
1.6
Other
6.4
5.6
Total payables and other financial liabilities
226.4
195.4
1. Largely represents amounts received in advance relating to the following month’s lease rental income and recovery of property outgoings revenue.
123
Sustainability assurance
Securityholders
Directory
Communities
Suppliers
Climate and environment
Risks
Governance
Tax
Financial report
13. Provisions
Working capital
Provisions comprise liabilities arising from employee benefits, such as annual leave, long service leave and related on-costs, land tax
levies and other items for which the amount or timing of the settlement is uncertain as it is outside the control of the Group.
Where the provisions are not expected to be settled wholly within 12 months after the end of the annual reporting period in which
the obligation arises, the liability is discounted to present value based on management’s best estimate of the timing of settlement and
the expenditure required to settle the liability at the reporting date.
The discount rates used to calculate the present value of employee-related provisions are determined with reference to market yields
at the end of the reporting period attaching to high quality corporate bonds with terms to maturity and currencies that match, as
closely as possible, the estimated future cash outflows of the related liability.
30 Jun 24
$m
30 Jun 23
$m
Current
Current employee entitlements
60.1
59.7
Other current provisions
16.1
17.9
Total current provisions
76.2
77.6
Non-current
Non-current employee entitlements
4.1
3.9
Total non-current provisions
4.1
3.9
The movements for the year in other provisions are as follows:
30 Jun 24
30 Jun 23
Land tax levies
$m
Other
$m
Land tax levies
$m
Other
$m
Opening balance at 1 July
17.7
0.2
21.2
0.9
Arising during the year
15.8
0.1
17.7
—
Paid during the year
(17.7)
—
(21.2)
(0.7)
Closing balance 30 June
15.8
0.3
17.7
0.2
People
Chairman/CEO letter
Highlights
Introduction
Operating and financial review
Sustainability
Customers
Vicinity Centres | 2024 Annual Report
124
The remuneration of the Key Management Personnel (KMP) of the Group is disclosed in the Remuneration Report. The compensation
of KMP included in the Group’s financial statements comprises:
30 Jun 24
$’000
30 Jun 23
$’000
Short-term employee benefits – Executive KMP
3,440
3,624
Short-term employee benefits – Non-executive Directors
2,093
1,878
Termination benefits
—
750
Share based payments
2,135
2,966
Post-employment benefits
178
183
Other long-term employee benefits
74
68
Total remuneration of KMP of the Group
7,920
9,469
15. Employee benefits expense
Employee benefits expense consists of:
Note
30 Jun 24
$m
30 Jun 23
$m
Salaries and wages
103.9
99.2
Share based payments expense
16(a)
7.6
7.3
Other employee benefits expense
4.4
4.1
Total employee benefits expense
115.9
110.6
16. Share based payments
The Group remunerates eligible employees through three equity settled compensation plans. These plans are designed to align
executives’, senior management’s and team members’ interests with those of securityholders by incentivising participants to deliver
long-term shareholder returns. A summary of each plan is described below:
Plan
Description
Long-term incentive (LTI)
Executive KMP, other members of the Executive Leadership Team (ELT) and other senior
executives are granted a combination of performance and restricted rights to acquire Vicinity
securities for nil consideration. Performance rights granted are subject to Total Shareholder
Return (TSR) and Total Return (TR) hurdles.
The performance rights and restricted rights vest after completion of a three to four-year service
period and when certain hurdle requirements, which are set when the rights are granted, are
met. These hurdle requirements are set out in Note 16(c).
Short-term incentive (STI)
The STI provides the opportunity for eligible employees to receive an annual, performance-
based incentive award, when a combination of short-term Group financial, strategy and portfolio
enhancement, and individual performance objectives are achieved. For executive KMP, other
members of the ELT and other senior executives, a portion of the annual STI award is deferred
into equity for a period of 12 to 24 months. The amounts deferred become available to the
employee at the end of the deferral period, provided they remain employed by the Group.
Tax exempt restricted
securities plan (TERSO)
Subject to the Board’s approval each year, $1,000 worth of Vicinity securities are granted
annually to eligible employees for nil consideration. Securities granted are subject to a three-year
trading restriction unless the employee ceases to be employed by the Group. Participants in the
LTI do not participate in the TERSO.
Further details relating to the LTI and STI plans are included in Note 16(c).
14. Key Management Personnel
Remuneration
125
Sustainability assurance
Securityholders
Directory
Communities
Suppliers
Climate and environment
Risks
Governance
Tax
Financial report
16. Share based payments (continued)
Remuneration
a)
Share based payment expenses
The following expenses were recognised within employee benefits expense and share based payment reserves in relation to the share
based payment compensation plans:
30 Jun 24
$m
30 Jun 23
$m
LTI
3.7
3.4
STI
3.0
3.0
TERSO
0.9
0.9
Total share based payments
7.6
7.3
b)
Movements during the year
The movement in the number of LTI performance and restricted rights during the year was as follows:
30 Jun 24
Number
30 Jun 23
Number
Opening balance at the beginning of the year
8,641,473
11,220,194
Granted
4,744,792
3,770,648
Forfeited1
(437,734)
(4,335,939)
Lapsed2
—
(1,822,704)
Vested3
(1,684,501)
(190,726)
Outstanding at the end of the year
11,264,030
8,641,473
Exercisable at the end of the year
Nil
Nil
Weighted average remaining contractual life (years)
2.13
2.15
1. Rights forfeited under the FY21-FY24 LTI plans during the year (30 June 2023: rights forfeited under the FY21-FY23 LTI Plans).
2. Rights lapsed under the FY20 LTI plan.
3. The performance hurdles of the FY21 LTI TSR plan were tested as at reporting date with 1,336,991 performance rights vested. The FY21 LTI Tranche 3 restricted
rights also vested (30 June 2023: FY21 LTI Tranche 2 vested). The vested performance and restricted rights will be released to participants in September 2024
subject to cessation of employment rules.
People
Chairman/CEO letter
Highlights
Introduction
Operating and financial review
Sustainability
Customers
Vicinity Centres | 2024 Annual Report
126
16. Share based payments (continued)
Remuneration
c)
Plan details
LTI plan conditions
Features of the LTI grants on issue at 30 June 2024:
Performance Rights (PRs) and Restricted Rights (RRs)
Grant years
FY24 and FY23: Executive KMP and other members of the ELT granted PRs subject to
TSR (50% weighting) and TR (50% weighting) hurdles. Other senior executives granted PRs subject
to TSR (50% weighting) and RR (50% weighting) hurdles.
FY22: All participants granted PRs subject to TSR (50% weighting) and TR (50% weighting) hurdles.
FY21: All participants granted PRs subject to TSR (50% weighting) and RR (50% weighting) hurdles.
Performance period
TSR and TR: Four years, for each grant commencing from 1 July of the grant year.
RR: For each grant commencing from 1 July of the grant year:
҅ FY24 and FY23: Between three and four years.
҅ FY21: Four years1.
Service period
TSR and TR: Four years.
RR: Between three and four years.
Performance hurdles2
TSR: Relative TSR combines the security price movement and distributions (which are assumed to be
re-invested) to show the total return to securityholders, relative to that of other companies in the
TSR Comparator Group.
TR: Calculated as the change in Vicinity’s net tangible assets (NTA) value during the year plus total
distributions paid divided by the NTA value at the beginning of the year. The annual TR result for
each year during the performance period is then used to calculate the compound annual TR for the
performance period3.
RR: The FY21 awards granted to Executive KMP and other members of the ELT are subject to
effective performance as assessed by the Board, taking into consideration the financial, strategy,
portfolio, leadership, risk, governance and other applicable objectives over the respective
performance periods. The FY24, FY23 and FY21 awards granted to other executives are subject to
individual performance.
TSR Comparator Group
FY24, FY23 and FY22: Domestic REITs most closely aligned to the Group’s business which
included Scentre Group, Charter Hall Retail REIT, Region Group, The GPT Group and
Dexus Property Group. The FY23 and FY24 plans also included HomeCo Daily Needs REIT.
FY21: S&P/ASX 200 A-REIT Index at grant date, excluding Westfield Corporation and
Unibail-Rodamco-Westfield4.
1. The FY21 LTI Tranche 1 and Tranche 2 RRs with two and three year performance periods respectively, vested in prior periods.
2. For the purposes of the LTI plan assessment, each performance hurdle operates independently of the other.
3. To ensure that the TR performance rights vesting reflects the value created from the efficient management of the Group’s assets and there is no undue advantage,
penalty or disincentive for undertaking certain activities, TR outcomes may be adjusted. Both upwards and downwards adjustments can be made, with reference
to principles agreed by the Remuneration and Human Resources Committee.
4. Westfield Corporation (ASX: WDC) merged with Unibail-Rodamco to form Unibail-Rodamco-Westfield (URW) in May 2018. WDC was de-listed from the ASX
and a CHESS depository interest for URW (ASX: URW) was listed on the ASX. The TSR Comparator Group excludes WDC and URW.
127
Sustainability assurance
Securityholders
Directory
Communities
Suppliers
Climate and environment
Risks
Governance
Tax
Financial report
Remuneration
16. Share based payments (continued)
c)
Plan details (continued)
Valuation of LTI plans
The fair value of performance rights granted under the LTI is estimated at the date of grant using a Monte Carlo Simulation Model
taking into account the terms and conditions upon which the rights were granted. For grants with non-market vesting conditions
(TR and RR), the grant date fair value is expensed over the vesting period and adjusted to reflect the actual number of rights for
which the related service and non-market vesting conditions are expected to be met. The grant date fair value of awards with market
performance conditions (TSR) reflects the probability of these conditions being met and hence the expense recognised over the
vesting period is only adjusted for changes in expectations as to whether service criteria will be met.
The weighted average fair value assumptions at the grant date used in valuing performance and restricted rights granted in the period
are shown in the table below:
Assumption
Basis
FY24 awards
FY23 awards
Security price at measurement date
Closing Vicinity securities price at grant date.
$1.92
$1.99
Distribution yield (p.a.)
Historical distributions paid over the last three years.
6.0%
4.9%
Risk-free interest rate
Four-year government bond yields as at grant date.
4.0%
3.1%
Volatility correlation between Vicinity
and other comparator companies
Analysis of historical total security return volatility
(i.e. standard deviation) and the implied volatilities of
exchange traded options.
68.0%
68.0%
Volatility of Vicinity securities
20.0%
40.6%
TSR of Vicinity securities
Performance between the start date of the testing
period and the valuation date.
6.7%
11.8%
Fair value per performance right – TSR
$0.88
$1.06
Fair value per performance right – TR
$1.52
$1.64
Fair value per restricted right – tranche 1
$1.64
$1.75
Fair value per restricted right – tranche 2
$1.54
$1.66
Other plans
STI Plan
1,651,160 securities were allocated on 1 October 2023 under the FY23 Deferred STI plan (30 June 2023: 1,885,265). These are
held in escrow and released to employees upon completion of the relevant service condition. The fair value of these securities was
$1.78 per security (30 June 2023: $1.91) being the volume weighted average security price of VCX in the 10 trading days prior to the
grant date.
TERSO
A total of 527,805 securities were granted under TERSO during the year (30 June 2023: 455,500).
People
Chairman/CEO letter
Highlights
Introduction
Operating and financial review
Sustainability
Customers
Vicinity Centres | 2024 Annual Report
128
Intangible asset balances at 30 June 2024 relate to the value of external management contracts. The external management contracts
were recognised upon business combinations at their fair value at both the date of Novion Property Group’s acquisition of the
Commonwealth Bank of Australia’s property management business (on 24 March 2014) and the merger of Novion Property Group
and Federation Centres (on 11 June 2015). They reflect the right to provide asset management services to strategic partners who
co-own investment property assets with the Group and accordingly are allocated to the Strategic Partnerships cash-generating unit
(SP CGU), which is also an operating and reportable segment. As the management contracts do not have termination dates, they are
considered to have indefinite lives and are not amortised. The Group performs impairment testing for indefinite life intangible assets
at least annually, or when there are other indicators of impairment.
The carrying value of the intangible asset is shown in the table below:
30 Jun 24
$m
30 Jun 23
$m
External management contracts
164.2
164.2
Carrying value
164.2
164.2
Impairment testing
The recoverable amount of the SP CGU is determined using a fair value less cost of disposal (fair value) approach. This is performed
using a collective DCF valuation of the cash flows generated from external asset and funds management contracts which is based on
the following key assumptions:
Key assumption
30 Jun 24
30 Jun 23
Post-tax external management contract cash flows
5 years
5 years
Terminal value growth rate
2.30%
2.30%
Post-tax discount rate range
7.22% – 7.72%
6.75% – 7.25%
The impairment test at 30 June 2024 determined that the recoverable amount of the SP CGU exceeded its carrying value and no
impairment was required.
Process for determination of key assumptions
The key inputs, which are considered Level 3 in the fair value hierarchy, used in determining the recoverable amounts were
determined as follows:
҅ The discount rates were calculated based on the Group’s estimated weighted average cost of capital, with reference to the Group’s
long-term average cost of debt and estimated cost of equity which is derived with reference to external sources of information and
the Group’s target gearing ratio, adjusted for specific risk factors to the relevant CGU.
҅ Terminal value growth rates were estimated with reference to long-term expectations of macro-economic conditions (including
consideration of equity analyst estimates) and the Group’s expected long-term earnings growth.
҅ Five year forecast of operating, asset and funds management cash flows based on the values determined by the Group’s budgeting
and planning process.
Significant judgement and estimate
The determination of the key assumptions and inputs to the impairment testing process as outlined above requires a significant level
of estimation. As a result, the recoverable amount of the SP CGU (as determined by the impairment testing process outlined above)
is subject to variability in these key assumptions or inputs. A change in one or more of the key assumptions or inputs could result in a
change in assessed recoverable amount.
Sensitivity to changes in assumptions
Sensitivities to the key assumptions within the external management contracts DCF were tested and the Group has determined that
due to the long-term nature of the asset management contracts and associated cashflows, no reasonably possible changes would give
rise to impairment at 30 June 2024. A disposal of a large portion of directly owned or equity accounted investment property assets,
where the Group also gives up any future management rights under existing indefinite life contracts, may lead to the full or partial
derecognition of the intangible asset balance, as external asset management fees earned by the Group may no longer be sufficient
to support the current carrying value of these intangible assets. There are no significant disposals contemplated as at the date of
this report.
17. Intangible assets
Other disclosures
129
Sustainability assurance
Securityholders
Directory
Communities
Suppliers
Climate and environment
Risks
Governance
Tax
Financial report
18. Leases
Other disclosures
All leases (lessee accounting) are accounted for by recognising
a right of use asset and a lease liability except for leases of low
value assets and short-term leases which are expensed in the
period when incurred.
Lease liabilities
Lease liabilities are measured at the present value of the
contractual payments due to the lessor over the lease term
(which includes any extension option periods assessed as
reasonably certain to be exercised). The discount rate applied is
determined by reference to the interest rate implicit in the lease
unless (as is typically the case) this is not readily determinable,
in which case the lessee’s incremental borrowing rate on
commencement of the lease is used. Variable lease payments
are only included in the measurement of the lease liability if they
depend on an index or rate, initially measured using the index
or rate as at the commencement date. In such cases, the initial
measurement of the lease liability assumes the variable element
will remain unchanged throughout the lease. Other variable
lease payments are expensed in the period to which they relate.
On initial recognition, the carrying value of the lease liability
also includes:
҅ Amounts expected to be payable under any residual
value guarantee;
҅ The exercise price of any purchase option granted in favour of
the Group if it is reasonably certain to exercise that option; and
҅ Any penalties payable for terminating the lease, if the
term of the lease has been estimated on the basis of the
termination option being exercised.
Subsequent to initial measurement, lease liabilities increase as
a result of interest charged at a constant rate on the balance
outstanding and are reduced for lease payments made. Lease
liabilities are remeasured when there is a change in future
lease payments arising from modification, a change in an index
or rate, when there is a change in the assessment of the term
of any lease or a change in the assessment of purchasing the
underlying asset.
Lease liabilities are presented based on the net cash outflows
expected to be settled within 12 months in determining the
current liability. A lease agreement is considered a single unit
of account, therefore any net cash inflows within 12 months
are not separately presented as an asset.
Right of use assets
Right of use assets are initially measured at the amount of
the lease liability recognised, adjusted for any prepaid lease
payments, initial direct costs incurred and an estimate of
costs to be incurred by the lessee in restoring the site on
which it is located.
Subsequent to initial measurement, right of use assets are
depreciated on a straight-line basis over the remaining term
of the lease or over the remaining economic life of the asset
if this is judged to be shorter than the lease term. Right of
use assets are also subject to assessment for impairment, and
are tested for impairment where there is an indicator that an
asset may be impaired. Right of use assets are adjusted for any
remeasurement of the associated lease liability.
Right of use assets and net investments in leases and lease
liabilities are presented separately in the Balance Sheet. Right of
use assets relating to investment properties are included within
the investment property balance and are measured at fair value
in accordance with AASB 140 Investment Property.
People
Chairman/CEO letter
Highlights
Introduction
Operating and financial review
Sustainability
Customers
Vicinity Centres | 2024 Annual Report
130
18. Leases (continued)
Other disclosures
a)
Movements for the year
The table below shows the movements in the Group’s lease related balances for the year:
30 Jun 24
30 Jun 23
Assets
Lease liabilities
Assets
Lease liabilities
Right of use
assets
$m
Investment
property
leaseholds3
$m
Other
leases
$m
Right of use
assets
$m
Investment
property
leaseholds3
$m
Other
leases
$m
Opening balance – 1 July
24.6
(359.0)
(28.9)
27.2
(357.4)
(31.7)
Interest charge on lease liabilities
—
(27.5)
(1.7)
—
(27.3)
(1.6)
Lease payments/(receipts)1
—
26.6
5.3
(0.3)
27.1
7.0
New leases during the period
6.1
—
(6.1)
2.6
—
(2.6)
Market rent reassessment
—
(0.9)
—
—
(1.4)
—
Depreciation
(4.5)
—
—
(4.9)
—
—
Closing balance – 30 June
26.2
(360.8)2
(31.4)2
24.6
(359.0)2
(28.9)2
1. Lease payments include $2.7 million (30 June 2023: $4.9 million (net of sub lease receipts)) in principal repayments and $29.2 million (30 June 2023: $28.9 million)
in interest charges on lease liabilities.
2. Total lease liabilities of $392.2 million (30 June 2023: $387.9 million) represents $6.0 million of current lease liabilities (30 June 2023: $5.4 million) and
$386.2 million of non-current lease liabilities (30 June 2023: $382.5 million).
3. A number of the Group’s investment properties are held under long-term leasehold arrangements. The right of use assets in relation to these investment property
leaseholds meet the definition of investment property and are presented within investment property in Note 4(a).
b)
Lease liabilities maturity profile
The table below shows the undiscounted maturity profile of the Group’s lease liabilities due as follows:
30 Jun 24
$m
30 Jun 23
$m
Lease liabilities
Not later than one year
32.2
30.7
Later than one but not more than five years
133.7
126.1
More than five years
761.1
793.7
Total
927.0
950.5
The Group also recognised variable lease payments of $21.9 million during the year (30 June 2023: $18.3 million). These related
primarily to investment property leaseholds where a component of lease payments is based on profitability achieved by the relevant
property. As these lease payments are variable in nature, they are not included within the investment property leaseholds lease
liability balance.
131
Sustainability assurance
Securityholders
Directory
Communities
Suppliers
Climate and environment
Risks
Governance
Tax
Financial report
19. Operating cash flow reconciliation
Other disclosures
The reconciliation of net profit after tax for the year to net cash provided by operating activities is provided below.
30 Jun 24
$m
30 Jun 23
$m
Net profit after tax
547.1
271.5
Exclude non-cash items and cash flows under investing and financing activities:
Amortisation of incentives and leasing costs
72.6
68.8
Straight-lining of rent adjustment
(6.5)
(2.8)
Property revaluation decrement for directly owned properties
38.9
195.9
Share of net loss of equity accounted investments
14.3
50.9
Amortisation of non-cash items included in interest expense
4.6
4.5
Net foreign exchange movement on interest bearing liabilities
(6.9)
139.9
Net mark-to-market movement on derivatives
(36.3)
(66.4)
Landholder duty paid
17.7
—
Depreciation of right of use assets
4.5
4.9
Income tax benefit
(2.9)
(5.4)
Other non-cash items
5.3
13.6
Movements in working capital:
Increase in payables and other financial liabilities, and provisions
13.1
0.6
Decrease in receivables including distributions receivable and other assets
24.6
29.7
Net cash inflow from operating activities
690.1
705.7
20. Auditor’s remuneration
During the year, the following fees were paid or payable for services provided by the auditor of the Group, EY or its related practices.
30 Jun 24
$’000
30 Jun 23
$’000
Audit and review of statutory financial statements of the Group and its controlled entities
1,345
1,297
Assurance services required by legislation to be provided by the auditor
22
21
Other assurance and agreed-upon procedures services under other legislation
or contractual arrangements
Property related audits1
279
274
Sustainability assurance services
52
50
Other assurance services
54
51
Total other assurance services under other legislation or contractual arrangements
385
375
Other services
Taxation compliance services
321
277
Sustainability assurance services
156
140
Other services
12
44
Total other services
489
461
Total auditor’s remuneration
2,241
2,154
1. Comprises audits of outgoing statements, promotional funds, real estate trust account and joint venture audits required under legislation or contractual
arrangements.
People
Chairman/CEO letter
Highlights
Introduction
Operating and financial review
Sustainability
Customers
Vicinity Centres | 2024 Annual Report
132
21. Parent entity financial information
Other disclosures
a)
Summary financials
The financial information presented below represents that of the legal parent entity, and deemed parent entity of the stapled Group,
Vicinity Limited. Vicinity Limited recognises investments in subsidiary entities at cost, less any impairment since acquisition. Other
accounting policies applied by Vicinity Limited are consistent with those used for the preparation of the consolidated Financial Report.
30 Jun 24
$m
30 Jun 23
$m
Current assets
18.6
141.1
Total assets
758.3
771.5
Current liabilities
86.3
64.4
Total liabilities
562.9
557.2
Net assets
195.4
214.3
Equity
Contributed equity
515.6
515.6
Share based payment reserve
5.0
1.9
Accumulated losses
(325.2)
(303.2)
Total equity
195.4
214.3
Net (loss)/profit for the financial year
(22.0)
11.3
Total comprehensive (loss)/income for the financial year
(22.0)
11.3
Vicinity Limited has access to undrawn financing facilities of $183.4 million (30 June 2023: $167.2 million), in order to pay its current
obligations as and when they fall due.
The parent entity has no capital expenditure commitments (30 June 2023: nil) which have been contracted but not provided for, or
contingencies (30 June 2023: nil) as at reporting date. Guarantees provided to subsidiary entities are disclosed at Note 23(b) and
predominantly relate to fulfilling capital requirements under Australian Financial Services Licences held by these subsidiaries.
b)
Stapled entity allocation of net profit
In accordance with AASB 3 Business Combinations, the Company is the parent of the Vicinity Centres stapled group for accounting
purposes. As the Company has no legal ownership over Vicinity Centres Trust and its controlled entities, the allocation of net profit
and net assets is shown separately for the Company and the Trust in the Statement of Comprehensive Income and Statement of
Changes in Equity.
133
Sustainability assurance
Securityholders
Directory
Communities
Suppliers
Climate and environment
Risks
Governance
Tax
Financial report
22. Related parties
Other disclosures
a)
Background
The deemed parent entity of the Group is Vicinity Limited, which is domiciled and incorporated in Australia. All subsidiaries and sub-
trusts of the Group are wholly-owned subsidiaries of Vicinity Limited or sub-trusts of Vicinity Centres Trust as at 30 June 2024.
b)
Information on related party transactions and balances
Vicinity Funds RE Ltd, a wholly-owned subsidiary of the Group, is the Responsible Entity of Direct Property Investment Fund A and
Direct Property Investment Fund B (collectively known as the Wholesale funds managed by the Group).
Vicinity Asset Operations Ptd Ltd, an associate of the Group, is a tenant of the Group’s centres where it is the carpark operator.
The transactions with related parties are made on normal commercial terms, and the balances outstanding at 30 June 2024 are
outlined in the tables below.
Related party balances with Wholesale funds
Funds management fee receivable
Alignment fee payable
30 Jun 24
$’000
30 Jun 23
$’000
30 Jun 24
$’000
30 Jun 23
$’000
Wholesale funds managed by the Group
9
300
2
72
Outstanding related party trade receivables balances at year end are unsecured and settlement occurs in cash. The Group does not
hold any collateral in relation to related party receivables.
Related party transactions with Wholesale funds
30 Jun 24
$’000
30 Jun 23
$’000
Asset and funds management fee income
1,001
2,634
Reimbursement of expenses to the property manager
354
712
Alignment fee expense
(101)
(299)
Rent and outgoings expenses
(36)
(105)
Related party balances and transactions with other associates
Vicinity Asset Operations Pty Ltd
30 Jun 24
$’000
30 Jun 23
$’000
Rent and outgoings income
5,494
5,037
Distribution income
912
—
Receivables
1,651
1,680
23. Commitments and contingencies
a)
Capital commitments
Estimated maintenance, development and leasing capital of the Group committed at reporting date, but not recognised on the
Balance Sheet:
30 Jun 24
$m
30 Jun 23
$m
Not later than one year
313.4
189.2
Later than one but not more than five years
88.3
0.1
Total capital commitments
401.7
189.3
b)
Contingent assets and liabilities
Bank guarantees totalling $39.4 million (30 June 2023: $39.3 million) have been arranged by the Group, primarily to guarantee
obligations for two of the Group’s Responsible Entities to meet their financial obligations under their Australian Financial Services
Licences, and for other capital commitments of the Group.
As at reporting date, there were no other material contingent assets or liabilities.
People
Chairman/CEO letter
Highlights
Introduction
Operating and financial review
Sustainability
Customers
Vicinity Centres | 2024 Annual Report
134
24. Other Group accounting matters
Other disclosures
This section contains other accounting policies that relate to the
financial statements, detail of any changes in accounting policies
and the impact of new or amended accounting standards.
Principles of consolidation
These consolidated financial statements comprise the assets
and liabilities of all controlled entities at 30 June 2024 and the
results of all controlled entities for the financial year unless
otherwise stated. Controlled entities are:
҅ All entities over which the Group is exposed to, or has rights
to, variable returns from its involvement with the entity and
has the ability to affect those returns through its power to
direct the relevant activities of the entity; and
҅ Fully consolidated from the date on which control
is transferred to the Group, and, where applicable,
deconsolidated from the date on which control ceases.
The acquisition method of accounting is used to account for the
acquisition of controlled entities, and the balances and effects of
transactions between all controlled entities are eliminated in full.
Vicinity Limited is the parent of the stapled Group for accounting
purposes. The results and equity attributable to securityholders
of other stapled entities of the Group including Vicinity Centres
Trust are shown net of the elimination of transactions between
Vicinity Limited and Vicinity Centres Trust.
Investments in joint operations
Included in investment properties are shopping centres that
are accounted for as joint operations – in the form of direct
ownership of a partial freehold or leasehold interest in a
shopping centre with a strategic partner, based on standard
market joint operation agreements. The Group accounts for
joint operations by recognising its share of the shopping centre,
classified as investment property, and its share of other assets,
liabilities, income and expenses from the use and output of the
joint operation.
Fair value measurement
The Group has classified fair value measurements
into the following hierarchy as required by
AASB 13 Fair Value Measurement:
҅ Level 1: quoted prices (unadjusted) in active markets
for identical assets or liabilities.
҅ Level 2: inputs other than quoted prices included within
Level 1 that are observable for the asset or liability, either
directly or indirectly.
҅ Level 3: inputs for the asset or liability that are not based
on observable market data (unobservable inputs).
Impact of new and amended accounting standards
New and amended standards that became effective as of
1 July 2023 did not have a material impact on the financial
statements of the Group as they are either not relevant to
the Group’s activities or require accounting which is
consistent with the Group’s accounting policies.
Future impact of Accounting Standards and
Interpretations issued but not yet effective
The Group has not adopted any standard, interpretation or
amendment that has been issued but is not yet effective
and these are not expected to have a material impact on the
Group’s financial position or performance.
The AASB issued AASB 18 Presentation and Disclosure in
Financial Statements in June 2024, which will be effective for
the Group in the financial year ending 30 June 2028. While
not expected to have a material impact on the Group’s financial
position or performance, AASB 18 is expected to change the
presentation of certain items in the financial statements in
future periods.
25. Events occurring after the end of the reporting period
Acquisition of 50% interest in Lakeside Joondalup
On 19 August 2024, the Group has simultaneously exchanged contracts and settled on the acquisition of a 50% interest in Lakeside
Joondalup, for $420.0 million. In addition, the Group also secured the property and retail development management rights.
Other property transactions
The divestment of investment properties held for sale at 30 June 2024, Maddington Central and Halls Head Central, were settled in
July 2024.
In addition, the Group has executed a contract of sale, subject to certain conditions precedent customary to such transaction, to
dispose of Mornington Central for $46.3 million on 29 July 2024. The transaction is expected to be settled by September 2024.
Other than the matters described above, no other matters have arisen since the end of the reporting period which have significantly
affected, or may significantly affect, the operations of the Group, the results of those operations, or the state of affairs of the Group
in future financial periods.
135
Sustainability assurance
Securityholders
Directory
Communities
Suppliers
Climate and environment
Risks
Governance
Tax
Financial report
The Consolidated Entity Disclosure Statement (CEDS) for Vicinity Limited has been prepared as at 30 June 2024 based on the
requirements of the Corporations Act 2001 (Cth). It is that of the stapled group comprising Vicinity Limited (the Company) and Vicinity
Centres Trust (the Trust) (collectively the Group). The Stapling Deed entered into by the Company and the Trust ensures that shares
in the Company and units in the Trust are ‘stapled’ together and are traded collectively on the Australian Securities Exchange (ASX)
under the code ‘VCX’. For financial reporting purposes, the Company has been identified as the parent entity of the Group.
Consolidated Entity Disclosure Statement
Name of entity1
Type of entity2
Trustee, partner
or participant3
Effective ownership
interest %4
Vicinity Limited
Body corporate
100
CC Holdings No. 1 Pty Ltd
Body corporate
Trustee
100
CC Holdings No. 2 Pty Ltd
Body corporate
Trustee
100
CC No. 1 Pty Ltd
Body corporate
Trustee
100
CC No. 2 Pty Ltd
Body corporate
Trustee
100
CCC Commercial Pty Ltd
Body corporate
Trustee
100
CS Subcust 1 Pty Ltd
Body corporate
100
Elizabeth City Centre Pty. Ltd.
Body corporate
100
Glen Centre Pty Ltd
Body corporate
Trustee
100
Karratha Pty Ltd (trading name – Pleach Pty Ltd)
Body corporate
100
Mornington Pty Ltd
Body corporate
Trustee
100
RDP 26 Custodian No. 1 Pty Ltd
Body corporate
Trustee
100
RDP 5 Custodian Pty Ltd
Body corporate
100
Tweed Mall Pty Ltd
Body corporate
100
Vicinity (VIC) Pty Ltd
Body corporate
100
Vicinity (WA) Pty Ltd
Body corporate
100
Vicinity Bankstown Pty Ltd
Body corporate
Trustee
100
Vicinity Box Hill North Pty Ltd
Body corporate
100
Vicinity Centres Development Pty Ltd
Body corporate
Trustee
100
Vicinity Centres PM Pty Ltd
Body corporate
Trustee
100
Vicinity Centres RE Ltd
Body corporate
Trustee
100
Vicinity Corporate Services Pty Ltd
Body corporate
100
Vicinity Custodian Pty Ltd
Body corporate
Trustee
100
Vicinity Energy Services Pty Ltd
Body corporate
100
Vicinity ESP Pty Ltd
Body corporate
100
Vicinity FIF IT Pty Ltd
Body corporate
Trustee
100
Vicinity Finance Pty Ltd
Body corporate
100
Vicinity Funds Management Pty Ltd
Body corporate
Trustee
100
Vicinity Funds RE Ltd
Body corporate
Trustee
100
Vicinity Holdings Limited
Body corporate
100
Vicinity Hotel Pty Ltd
Body corporate
100
Vicinity IP Pty Ltd
Body corporate
100
Vicinity Manager Pty Ltd
Body corporate
Trustee
100
Vicinity PM Holdings Pty Ltd
Body corporate
100
Vicinity RDP Pty Ltd
Body corporate
100
Vicinity Real Estate Licence Pty Ltd
Body corporate
100
Vicinity Victoria Gardens Pty Ltd
Body corporate
100
Vicinity Centres Trust
Trust
n/a
Armidale Trust
Trust
n/a
Bankstown Holding Trust
Trust
n/a
Box Hill South Holding Trust
Trust
n/a
Box Hill South Trust
Trust
n/a
Buranda Holding Trust
Trust
n/a
Carlingford Court Trust
Trust
n/a
CC Commercial Trust
Trust
n/a
CC Holdings No. 1 Trust
Trust
n/a
Consolidated Entity Disclosure Statement
People
Chairman/CEO letter
Highlights
Introduction
Operating and financial review
Sustainability
Customers
Vicinity Centres | 2024 Annual Report
136
Consolidated Entity Disclosure Statement
Name of entity1
Type of entity2
Trustee, partner
or participant3
Effective ownership
interest %4
CC Holdings No. 2 Trust
Trust
n/a
CC No. 1 Trust
Trust
n/a
CC No. 2 Trust
Trust
n/a
Colonnades Head Trust
Trust
n/a
Colonnades Holding Trust
Trust
n/a
Colonnades Trust
Trust
n/a
Cranbourne Holding Trust
Trust
n/a
Cranbourne Trust
Trust
n/a
DFO Brisbane Trust
Trust
n/a
DFO Perth Trust
Trust
n/a
DFO Uni Hill Trust
Trust
n/a
Dianella Trust
Trust
n/a
Ellenbrook Trust
Trust
n/a
Employee Share Plan Trust
Trust
n/a
FIF Buranda Trust
Trust
n/a
FIF Investment Trust
Trust
n/a
FIF Whitsunday Holding Trust
Trust
n/a
Flinders Trust
Trust
n/a
Galleria Holding Trust
Trust
n/a
Galleria Trust
Trust
n/a
Glen Holding Trust
Trust
n/a
Goulburn Holding Trust
Trust
n/a
Gympie Holding Trust
Trust
n/a
Gympie Trust No. 1
Trust
n/a
Gympie Trust No. 2
Trust
n/a
Halls Head Trust
Trust
n/a
Karratha Head Trust
Trust
n/a
Karratha Holding Trust
Trust
n/a
Karratha Sub Trust
Trust
n/a
Karratha Trust
Trust
n/a
Livingston Trust
Trust
n/a
Maddington Holding Trust
Trust
n/a
Maddington Trust No.1
Trust
n/a
Maddington Trust No.2
Trust
n/a
Mandurah Freehold Trust
Trust
n/a
Mandurah Holding Trust
Trust
n/a
Mandurah Trust
Trust
n/a
Milton Holding Trust
Trust
n/a
Mornington Holding Trust
Trust
n/a
Mornington Sub Trust
Trust
n/a
Mornington Trust
Trust
n/a
Nepean Holding Trust
Trust
n/a
Nepean Sub Trust
Trust
n/a
Nepean Trust
Trust
n/a
Oakleigh Trust
Trust
n/a
Property Head Trust No. 2
Trust
n/a
Property Head Trust No.1
Trust
n/a
RDP Investment Trust
Trust
n/a
Retail Direct Property 26
Trust
n/a
Retail Direct Property 5
Trust
n/a
SH Sub Trust 1
Trust
n/a
Consolidated Entity Disclosure Statement (continued)
137
Sustainability assurance
Securityholders
Directory
Communities
Suppliers
Climate and environment
Risks
Governance
Tax
Financial report
Consolidated Entity Disclosure Statement
Name of entity1
Type of entity2
Trustee, partner
or participant3
Effective ownership
interest %4
SH Sub Trust 2
Trust
n/a
Taigum Head Trust
Trust
n/a
Taigum Holding Trust
Trust
n/a
Taigum Trust
Trust
n/a
The Bourke and Lonsdale Trust
Trust
n/a
The Glen Trust
Trust
n/a
VCX Property Management Trust
Trust
n/a
Vicinity 26 Holding Trust
Trust
n/a
Vicinity 26 Sub Trust
Trust
n/a
Vicinity Bankstown Trust
Trust
n/a
Vicinity Centres Trust No. 2
Trust
n/a
Vicinity Centres Trust No.3
Trust
n/a
Vicinity Development Trust
Trust
n/a
Vicinity Fund Holding Trust
Trust
n/a
Vicinity Fund Sub Trust
Trust
n/a
Vicinity Fund Trust
Trust
n/a
Vicinity Galeries Trust
Trust
n/a
Vicinity HTGC Trust
Trust
n/a
Vicinity Investment Fund
Trust
n/a
Vicinity NVN Trust
Trust
n/a
Vicinity Pooled Property Trust
Trust
n/a
Vicinity PPF Head Trust
Trust
n/a
Vicinity PPF Holding Trust
Trust
n/a
Vicinity PPF Trust
Trust
n/a
Vicinity Property Fund No.2
Trust
n/a
Vicinity Property Investment Trust
Trust
n/a
Vicinity Property Management Trust
Trust
n/a
Vicinity QVB Trust
Trust
n/a
Vicinity RDP Holding Trust No.3
Trust
n/a
Vicinity RDP Sub Trust No. 3
Trust
n/a
Vicinity RDP Sub Trust No.1
Trust
n/a
Vicinity Retail Sub Trust
Trust
n/a
Vicinity Roselands Trust
Trust
n/a
Vicinity Strand Trust
Trust
n/a
Vicinity Sunshine Trust
Trust
n/a
Vicinity Trading Trust
Trust
n/a
Victoria Park Trust
Trust
n/a
Warriewood Holding Trust
Trust
n/a
Warriewood Sub Trust
Trust
n/a
Warriewood Trust
Trust
n/a
Warwick Cinemas Trust
Trust
n/a
Warwick Grove Trust
Trust
n/a
Whitsunday Holding Trust
Trust
n/a
Whitsunday Trust
Trust
n/a
1. The consolidated entities within the Group are Australian tax residents.
2. The consolidated body corporates within the Group are incorporated in Australia.
3. Represents the entity’s role over another consolidated entity within the Group (where applicable).
4. Represents the direct and indirect ownership interest of the relevant body corporate held by Vicinity Limited.
Consolidated Entity Disclosure Statement (continued)
People
Chairman/CEO letter
Highlights
Introduction
Operating and financial review
Sustainability
Customers
Vicinity Centres | 2024 Annual Report
138
In accordance with a resolution of the Directors of Vicinity Limited, we declare that:
a) in the opinion of the Directors, the financial statements and notes set out on pages 94 to 135 are in accordance with the
Corporations Act 2001 (Cth), including:
i. giving a true and fair view of the Group and its controlled entities’ financial position as at 30 June 2024 and of the performance
for the financial year ended on that date; and
ii. complying with Australian Accounting Standards and the Corporations Regulations 2001 (Cth); and
iii. complying with International Financial Reporting Standards as issued by the International Accounting Standards Board as
disclosed in the About this Report section of the financial statements; and
iv. the consolidated entity disclosure statement set out on pages 136 to 138 is true and correct; and
b) in the opinion of the Directors, there are reasonable grounds to believe that the Group and its controlled entities will be able to
pay their debts as and when they become due and payable; and
c) the Directors have been given the Declarations required to be made to the Directors in accordance with section 295A of the
Corporations Act 2001 (Cth) for the financial year ended 30 June 2024.
Signed in accordance with a resolution of the Directors of Vicinity Limited.
Directors’ Declaration
Trevor Gerber
Chairman
20 August 2024
139
Sustainability assurance
Securityholders
Directory
Communities
Suppliers
Climate and environment
Risks
Governance
Tax
Financial report
A member firm of Ernst & Young Global Limited
Liability limited by a scheme approved under Professional Standards Legislation
Ernst & Young
8 Exhibition Street
Melbourne VIC 3000 Australia
GPO Box 67 Melbourne VIC 3001
Tel: +61 3 9288 8000
Fax: +61 3 8650 7777
ey.com/au
Independent Auditor's Report
To the Members of Vicinity Limited
Report on the Audit of the Financial Report
Opinion
We have audited the financial report of Vicinity Limited (the “Company”), and the entities it controlled
(collectively “Vicinity Centres” or the “Group”), which comprises the consolidated statement of
financial position as at 30 June 2024, the consolidated statement of comprehensive income,
consolidated statement of changes in equity and consolidated cash flow statement for the year then
ended, notes to the financial statements, including a summary of material accounting policies, the
consolidated entity disclosure statement and the Directors’ declaration.
In our opinion, the accompanying financial report of the Group is in accordance with the Corporations
Act 2001, including:
a)
Giving a true and fair view of the consolidated balance sheet of the Group as at 30 June 2024
and of its consolidated financial performance for the year ended on that date; and
b)
Complying with Australian Accounting Standards and the Corporations Regulations 2001.
Basis for Opinion
We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under
those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial
Report section of our report. We are independent of the Group in accordance with the auditor
independence requirements of the Corporations Act 2001 and the ethical requirements of the
Accounting Professional and Ethical Standards Board’s APES 110 Code of Ethics for Professional
Accountants (including Independence Standards) (the Code) that are relevant to our audit of the
financial report in Australia. We have also fulfilled our other ethical responsibilities in accordance with
the Code.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis
for our opinion.
Key Audit Matters
Key audit matters are those matters that, in our professional judgment, were of most significance in
our audit of the financial report of the current year. These matters were addressed in the context of
our audit of the financial report as a whole, and in forming our opinion thereon, but we do not provide
a separate opinion on these matters. For each matter below, our description of how our audit
addressed the matter is provided in that context.
We have fulfilled the responsibilities described in the Auditor’s responsibilities for the audit of the
financial report section of our report, including in relation to these matters. Accordingly, our audit
included the performance of procedures designed to respond to our assessment of the risks of
material misstatement of the financial report. The results of our audit procedures, including the
procedures performed to address the matters below, provide the basis for our audit opinion on the
accompanying financial report.
Independent Auditor’s Report
People
Chairman/CEO letter
Highlights
Introduction
Operating and financial review
Sustainability
Customers
Vicinity Centres | 2024 Annual Report
140
A member firm of Ernst & Young Global Limited
Liability limited by a scheme approved under Professional Standards Legislation
1. Shopping Centre Investment Property Portfolio – Carrying Values and Revaluations
Why significant
How our audit addressed the key audit matter
The Group owns a portfolio of retail property
assets valued at $14,771.4 million at 30
June 2024, which represents 93.9% of total
assets of the Group. In addition, there are
retail property assets valued at $166.4
million held through interests in joint
ventures and $186.6 million classified as held
for sale.
These assets are carried at fair value, which
is assessed by the directors with reference to
external and internal property valuations and
are based on market conditions existing at
the reporting date.
The valuation of investment properties is
inherently subjective. A small difference in
any one of the key market input assumptions,
when aggregated across all the properties,
could result in a material change to the
valuation of investment properties.
We consider this a key audit matter due to
the number of judgements required in
determining fair value.
Note 4 of the financial report describes the
key assumptions, inputs, judgements and
estimations, in the determination of fair value
of investment properties and how this has
been considered by the directors in the
preparation of the financial report at 30 June
2024.
Our audit procedures included the following for properties held both
directly and through interests in joint ventures:
►
We discussed the following matters with management:
►
movements in the Group’s investment property portfolio;
►
changes in the condition of each property, including an
understanding of key developments and changes to
development activities;
►
changes in the Group’s investment property portfolio
including understanding leasing activity and tenant
occupancy risk; and
►
controls in place relevant to the valuation and development
processes.
►
In conjunction with our real estate valuation specialists, on a
sample basis, we performed the following procedures:
►
Evaluated the net income assumptions adopted against the
tenancy schedules. We also tested the effectiveness of
relevant controls over the leasing process and associated
tenancy schedules which are used as source data in the
property valuations.
►
Tested the mathematical accuracy of valuations.
►
Evaluated the suitability of the valuation methodology across
the portfolio based on the type of asset.
►
We considered the reports of the external and internal
valuers, to assess the reasonableness of the key assumptions
and estimates used. This included assumptions such as the
capitalisation, discount and growth rate and future forecast
rentals. We also obtained an understanding of how the
valuers consider environmental factors.
►
For properties under development, we considered key
assumptions such as estimated cost to complete the
development, allowances for developer’s risk and profit and
post development stabilisation allowances.
►
Where relevant we compared the valuation against market
data and comparable transactions utilised in the valuation
process.
►
Assessed the qualifications, competence and objectivity of
the valuers.
►
Assessed capitalised planning and holding costs relating to
planned major development projects.
►
We assessed the adequacy of the Group’s disclosures in the
financial report against the requirements of Australian
Accounting Standards.
Independent Auditor’s Report
141
Sustainability assurance
Securityholders
Directory
Communities
Suppliers
Climate and environment
Risks
Governance
Tax
Financial report
A member firm of Ernst & Young Global Limited
Liability limited by a scheme approved under Professional Standards Legislation
Information Other than the Financial Report and Auditor’s Report Thereon
The directors are responsible for the other information. The other information comprises the
information included in Vicinity Centres’ 2024 Annual Report but does not include the financial report
and our auditor’s report thereon.
Our opinion on the financial report does not cover the other information and accordingly we do not
express any form of assurance conclusion thereon, with the exception of the Remuneration Report
and our related assurance opinion.
In connection with our audit of the financial report, our responsibility is to read the other information
and, in doing so, consider whether the other information is materially inconsistent with the financial
report or our knowledge obtained in the audit or otherwise appears to be materially misstated.
If, based on the work we have performed, we conclude that there is a material misstatement of this
other information, we are required to report that fact. We have nothing to report in this regard.
Responsibilities of the Directors for the Financial Report
The directors of the Company are responsible for the preparation of:
(a) the financial report (other than the consolidated entity disclosure statement) that gives a true and
fair view in accordance with Australian Accounting Standards and the Corporations Act 2001; and
(b) the consolidated entity disclosure statement that is true and correct in accordance with the
Corporations Act 2001; and
for such internal control as the directors determine is necessary to enable the preparation of:
(i) the financial report (other than the consolidated entity disclosure statement) that gives a true and
fair view and is free from material misstatement, whether due to fraud or error; and
(ii) the consolidated entity disclosure statement that is true and correct and is free of misstatement,
whether due to fraud or error.
In preparing the financial report, the directors are responsible for assessing the Group’s ability to
continue as a going concern, disclosing, as applicable, matters relating to going concern and using the
going concern basis of accounting unless the directors either intend to liquidate the Group or to cease
operations, or have no realistic alternative but to do so.
Auditor's Responsibilities for the Audit of the Financial Report
Our objectives are to obtain reasonable assurance about whether the financial report as a whole is
free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that
includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an
audit conducted in accordance with the Australian Auditing Standards will always detect a material
misstatement when it exists. Misstatements can arise from fraud or error and are considered material
if, individually or in the aggregate, they could reasonably be expected to influence the economic
decisions of users taken on the basis of this financial report.
Independent Auditor’s Report
People
Chairman/CEO letter
Highlights
Introduction
Operating and financial review
Sustainability
Customers
Vicinity Centres | 2024 Annual Report
142
A member firm of Ernst & Young Global Limited
Liability limited by a scheme approved under Professional Standards Legislation
As part of an audit in accordance with the Australian Auditing Standards, we exercise professional
judgment and maintain professional scepticism throughout the audit. We also:
►
Identify and assess the risks of material misstatement of the financial report, whether due to
fraud or error, design and perform audit procedures responsive to those risks, and obtain audit
evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not
detecting a material misstatement resulting from fraud is higher than for one resulting from
error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the
override of internal control.
►
Obtain an understanding of internal control relevant to the audit in order to design audit
procedures that are appropriate in the circumstances, but not for the purpose of expressing an
opinion on the effectiveness of the Group’s internal control.
►
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting
estimates and related disclosures made by the directors.
►
Conclude on the appropriateness of the directors’ use of the going concern basis of accounting
and, based on the audit evidence obtained, whether a material uncertainty exists related to
events or conditions that may cast significant doubt on the Group’s ability to continue as a going
concern. If we conclude that a material uncertainty exists, we are required to draw attention in
our auditor’s report to the related disclosures in the financial report or, if such disclosures are
inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up
to the date of our auditor’s report. However, future events or conditions may cause the Group to
cease to continue as a going concern.
►
Evaluate the overall presentation, structure and content of the financial report, including the
disclosures, and whether the financial report represents the underlying transactions and events
in a manner that achieves fair presentation.
►
Obtain sufficient appropriate audit evidence regarding the financial information of the entities or
business activities within the Group to express an opinion on the financial report. We are
responsible for the direction, supervision and performance of the Group audit. We remain solely
responsible for our audit opinion.
We communicate with the directors regarding, among other matters, the planned scope and timing of
the audit and significant audit findings, including any significant deficiencies in internal control that we
identify during our audit.
We also provide the directors with a statement that we have complied with relevant ethical
requirements regarding independence, and to communicate with them all relationships and other
matters that may reasonably be thought to bear on our independence, and where applicable, actions
taken to eliminate threats or safeguards applied.
From the matters communicated to the directors, we determine those matters that were of most
significance in the audit of the financial report of the current year and are therefore the key audit
matters. We describe these matters in our auditor’s report unless law or regulation precludes public
disclosure about the matter or when, in extremely rare circumstances, we determine that a matter
should not be communicated in our report because the adverse consequences of doing so would
reasonably be expected to outweigh the public interest benefits of such communication.
Independent Auditor’s Report
143
Sustainability assurance
Securityholders
Directory
Communities
Suppliers
Climate and environment
Risks
Governance
Tax
Financial report
A member firm of Ernst & Young Global Limited
Liability limited by a scheme approved under Professional Standards Legislation
Report on the Audit of the Remuneration Report
Opinion on the Remuneration Report
We have audited the Remuneration Report included in the Directors' report for the year ended
30 June 2024.
In our opinion, the Remuneration Report of Vicinity Limited for the year ended 30 June 2024,
complies with section 300A of the Corporations Act 2001.
Responsibilities
The directors are responsible for the preparation and presentation of the Remuneration Report in
accordance with section 300A of the Corporations Act 2001. Our responsibility is to express an
opinion on the Remuneration Report, based on our audit conducted in accordance with Australian
Auditing Standards.
Ernst & Young
Michael Collins
Partner
Melbourne
20 August 2024
Independent Auditor’s Report
People
Chairman/CEO letter
Highlights
Introduction
Operating and financial review
Sustainability
Customers
Vicinity Centres | 2024 Annual Report
144
Sustainability Assurance
A member firm of Ernst & Young Global Limited
Liability limited by a scheme approved under Professional Standards Legislation
Independent Limited Assurance Report to the Management and Directors
of Vicinity Centres
Our Conclusion:
Ernst & Young (‘EY’, ‘we’) were engaged by Vicinity Limited and Vicinity Centres RE Ltd as Responsible Entity of
Vicinity Centres Trust (‘Vicinity’) to undertake a limited assurance engagement as defined by Australian Auditing
Standards, hereafter referred to as a ‘review’, over the Subject Matter defined below for the year ended 30 June
2024. Based on the procedures we have performed and the evidence we have obtained, nothing has come to our
attention that causes us to believe the Subject Matter has not been prepared, in all material respects, in accordance
with the Criteria defined below.
What our review covered
We reviewed the following Subject Matter in Vicinity’s
Annual Report and accompanying Sustainability
Performance Pack (the ‘Reports’):
We reviewed a selection of performance metrics, as
shown in the table below:
Subject Matter
Result
Total Scope 1 GHG emissions (tCO2-e) 5,294
Total Scope 2 GHG emissions (tCO2-e) 112,906
Total Scope 3 GHG emissions (tCO2-e) 217,014
Renewable energy consumption (MWh) 40,429
Renewable energy generation (MWh)
43,487
Total energy consumption (GJ)
665,711
Energy intensity – Managed portfolio
(MJ/sqm)
281
Carbon intensity: scope 1 and 2 GHG
emissions – Managed portfolio (kg
CO2-e/sqm)
50
Progress against net zero targets –
wholly owned assets (% movement in
carbon intensity)
38
Progress against net zero targets –
wholly owned assets (% movement in
energy intensity)
18
NABERS energy rating (portfolio
average)
4.5
NABERS water rating (portfolio
average)
3.7
Women in leadership (%)
52
Subject Matter
Result
Gender 40:40:20 target
62:38:0
Gender pay gap - Average total
remuneration (%)
38.2
Total Water consumption (KL)
2,217,175
Total of waste – landfill and recycled
(tonnes)
45,306
Waste diversion rate (% recycled)
52
Total indigenous procurement spend
($m)
7.5
Total spent with social & indigenous
businesses ($m)
8.3
Total Supplier Annual Spend ($m)
890.5
Number of Direct (Tier 1) Suppliers
2,542
Community Investment ($m) - Total
9.2
Community Investment ($m) – B4SI
7.3
Loss time injury frequency rate (LTIFR) 6.72
Employee absentee rate (%)
2.02
Sqm of gross lettable area (million)
2.4
Other than as described in the preceding paragraphs,
which set out the scope of our engagement, we did not
perform assurance procedures on the remaining
information included in the Reports, and accordingly,
we do not express an opinion or conclusion on this
information.
145
Securityholders
Directory
Communities
Suppliers
Climate and environment
Risks
Governance
Tax
Financial report
Sustainability assurance
Sustainability Assurance
A member firm of Ernst & Young Global Limited
Liability limited by a scheme approved under Professional Standards Legislation
Page 2
Criteria applied by Vicinity Centres
In preparing the subject matter, Vicinity applied the
following Criteria:
► Vicinity Centres’ Sustainability Reporting Criteria
FY24 which sets out the principles, scope, and
methodologies applied in the preparation and
reporting of Vicinity Centres' Sustainability
Performance Data.
► Definitions as per the Global Reporting Initiative’s
(GRI) Sustainability Reporting Standards
► Greenhouse Gas (GHG) Protocol
► The National Greenhouse Accounts Factors for
Australia
► Workplace Gender Equality Agency (WGEA)
► National Australian Built Environment Rating
System (NABERS)
► Business for Societal Impact (B4SI) framework
Use of Proceeds Report
We have also performed limited assurance procedures
in relation to Vicinity’s Sustainable Finance Framework
(‘the Framework’) and the associated FY24
performance data for the Vicinity Centres RE Limited as
responsible entity for Vicinity Centres Trust’s (‘Vicinity
RE’) Green Bond issuance. The procedures performed
were in order to conclude that nothing has come to our
attention that the Use of Proceeds Report as at 30 June
2024 does not meet the reporting requirements of
Vicinity’s Sustainable Finance Framework and the
Green Bond Principles (June 2021) published by the
International Capital Market Association (‘ICMA’).
Key responsibilities
Vicinity’s responsibility
Vicinity’s management is responsible for selecting the
Criteria, and for presenting the Subject Matter in
accordance with the Criteria, in all material respects.
This responsibility includes establishing and
maintaining internal controls, maintaining adequate
records and making estimates that are relevant to the
preparation of the subject matter, such that it is free
from material misstatement, whether due to fraud or
error.
EY’s responsibility and independence
Our responsibility is to express a conclusion on the
Subject Matter based on our review.
We have complied with the independence and relevant
ethical requirements, which are founded on
fundamental principles of integrity, objectivity,
professional competence and due care, confidentiality
and professional behaviour.
The firm applies Auditing Standard ASQM 1 Quality
Management for Firms that Perform Audits or Reviews
of Financial Reports and Other Financial Information, or
Other Assurance or Related Services Engagements,
which requires the firm to design, implement and
operate a system of quality management including
policies or procedures regarding compliance with
ethical requirements, professional standards and
applicable legal and regulatory requirements.
Our approach to conducting the review
We conducted this review in accordance with the
Australian Auditing and Assurance Standards Board’s
Australian Standard on Assurance Engagements Other
Than Audits or Reviews of Historical Financial
Information (‘ASAE3000’) and the terms of reference
for this engagement as agreed with Vicinity signed on
26 April 2024 and the addendum letter signed on 13
August 2024. That standard requires that we plan and
perform our engagement to express a conclusion on
whether anything has come to our attention that causes
us to believe that the Subject Matter is not prepared, in
all material respects, in accordance with the Criteria,
and to issue a report.
Summary of review procedures performed
A review consists of making enquiries, primarily of
persons responsible for preparing the subject matter
and related information and applying analytical and
other review procedures.
The nature, timing, and extent of the procedures
selected depend on our judgement, including an
assessment of the risk of material misstatement,
whether due to fraud or error. The procedures we
performed included, but were not limited to:
► Conducting interviews with personnel to understand
the business and reporting process
► Conducting interviews with key personnel to
understand the process for collecting, collating and
reporting the Subject Matter during the reporting
period
► Assessing that the calculation criteria have been
correctly applied in accordance with the
methodologies outlined in the Criteria
► Undertaking analytical review procedures to support
the reasonableness of the data
► Identifying and testing assumptions supporting
calculations
► Testing, on a sample basis, underlying source
information to assess the accuracy of the data.
People
Chairman/CEO letter
Highlights
Introduction
Operating and financial review
Sustainability
Customers
Vicinity Centres | 2024 Annual Report
146
A member firm of Ernst & Young Global Limited
Liability limited by a scheme approved under Professional Standards Legislation
Page 3
We believe that the evidence obtained is sufficient and
appropriate to provide a basis for our review
conclusion.
Inherent limitations
Procedures performed in a review engagement vary in
nature and timing from, and are less in extent than for, a
reasonable assurance engagement. Consequently, the
level of assurance obtained in a review engagement is
substantially lower than the assurance that would have
been obtained had a reasonable assurance engagement
been performed. Our procedures were designed to
obtain a limited level of assurance on which to base our
conclusion and do not provide all the evidence that would
be required to provide a reasonable level of assurance.
While we considered the effectiveness of
management’s internal controls when determining the
nature and extent of our procedures, our assurance
engagement was not designed to provide assurance on
internal controls. Our procedures did not include testing
controls or performing procedures relating to assessing
aggregation or calculation of data within IT systems.
The greenhouse gas quantification process is subject to
scientific
uncertainty,
which
arises
because
of
incomplete scientific knowledge about the measurement
of greenhouse gases. Additionally, greenhouse gas
procedures are subject to estimation and measurement
uncertainty resulting from the measurement and
calculation processes used to quantify emissions within
the bounds of existing scientific knowledge.
Use of our Assurance Report
We disclaim any assumption of responsibility for any
reliance on this assurance report to any persons other
than management and the Directors of Vicinity, or for
any purpose other than that for which it was prepared.
Our review included web-based information that was
available via web links as of the date of this statement.
We provide no assurance over changes to the content
of this web-based information after the date of this
assurance statement.
Ernst & Young
Melbourne, Australia
20 August 2024
Sustainability Assurance
147
Securityholders
Directory
Communities
Suppliers
Climate and environment
Risks
Governance
Tax
Financial report
Sustainability assurance
SPREAD OF SECURITYHOLDERS
As at 31 July 2024
Number of
Number of
% of issued
Range
securityholders
securities
securities
100,001 and over
224
4,379,216,217
96.20
10,001 to 100,000
5,244
121,989,040
2.68
5,001 to 10,000
3,995
29,448,043
0.65
1,001 to 5,000
6,915
19,016,568
0.42
1 to 1,000
5,805
2,605,490
0.05
Total
22,183
4,552,275,358
100.00
The number of securityholders holding less than a marketable parcel of 237 securities (based on a security price of $2.110 on
31 July 2024) is 1,461 and they hold 114,199 securities.
SUBSTANTIAL SECURITYHOLDERS 1
As at 9 August 2024
Date last
Number of
Company name
notice received
securities 2
The Gandel Group Pty Limited and its associates
9 June 2020
691,238,665
BlackRock Inc. and its subsidiaries
4 December 2023
420,805,220
The Vanguard Group, Inc. and its controlled entities
29 June 2021
389,569,636
UniSuper Limited as trustee for UniSuper and UniSuper Management Pty Limited
11 October 2021
368,551,567
State Street Corporation and its subsidiaries
9 August 2024
345,945,391
AustralianSuper Pty Ltd
1 August 2024
228,656,188
1. As notified to Vicinity in accordance with section 671B of the Corporations Act 2001 (Cth).
2. As disclosed in the last substantial holding notice lodged by the substantial securityholder with the ASX.
VOTING RIGHTS
In the case of a resolution of the Company, at a general meeting, each securityholder present has one vote on a show of hands,
or one vote for each security held on a poll.
In the case of a resolution of the Trust, at a general meeting, each securityholder present has one vote for each dollar of the value
of the total interests they have in the Trust.
UNQUOTED EQUITY SECURITIES
The number of performance rights on issue under Vicinity’s Long-Term Incentive Plan and Equity Incentive Plans was 11,059,025
and the number of holders of those performance rights was 57.
The number of restricted rights on issue under Vicinity’s Equity Incentive Plans was 1,912,101 and the number of holders of those
restricted rights was 57.
ON-MARKET PURCHASE OF SECURITIES
During FY24, 1,766,000 Vicinity securities were purchased on-market at an average price per security of $1.82 by the trustee
to satisfy entitlements under Vicinity’s Equity Incentive Plans.
Summary of Securityholders
People
Chairman/CEO letter
Highlights
Introduction
Operating and financial review
Sustainability
Customers
Vicinity Centres | 2024 Annual Report
148
TOP 20 LARGEST SECURITYHOLDERS
As at 31 July 2024
Number of
% of issued
Rank Name
securities held
securities
1
HSBC Custody Nominees (Australia) Limited
1,362,785,155
29.94
2
J P Morgan Nominees Australia Pty Limited
983,563,170
21.61
3
Citicorp Nominees Pty Limited
459,687,625
10.10
4
BNP Paribas Nominees Pty Ltd
428,872,629
9.42
5
Netwealth Investments Limited
401,080,006
8.81
6
Rosslynbridge Pty Ltd
92,069,814
2.02
7
Buttonwood Nominees Pty Ltd
82,990,000
1.82
8
BNP Paribas Noms Pty Ltd
77,024,223
1.69
9
Allowater Pty Ltd
63,624,571
1.40
10
National Nominees Limited
54,376,077
1.19
11
Citicorp Nominees Pty Limited
42,810,501
0.94
12
Ledburn Proprietary Limited
37,195,552
0.82
13
Broadgan Proprietary Limited
36,474,902
0.80
14
HSBC Custody Nominees (Australia) Limited
31,899,188
0.70
15
Cenarth Pty Ltd
31,605,848
0.69
16
Applebrook Pty Ltd
13,219,491
0.29
16
Jadecliff Pty Ltd
13,219,491
0.29
16
Moondale Pty Ltd
13,219,491
0.29
16
Rosecreek Pty Ltd
13,219,491
0.29
17
Ledburn Proprietary Limited
10,206,076
0.22
18
BNP Paribas Nominees Pty Ltd
9,959,076
0.22
19
Artmax Investments Limited
9,262,865
0.20
20
Pacific Custodians Pty Limited
7,262,599
0.16
Top 20 largest securityholders
4,275,627,841
93.92
Balance of register
276,647,517
6.08
Total issued capital
4,552,275,358
100.00
Summary of Securityholders
149
Sustainability assurance
Securityholders
Directory
Communities
Suppliers
Climate and environment
Risks
Governance
Tax
Financial report
Corporate Directory
Vicinity Centres
comprising:
Vicinity Limited
ABN 90 114 757 783
and
Vicinity Centres Trust
ARSN 104 931 928
ASX listing
Vicinity Centres is listed on the ASX
under the listing code VCX
Board of Directors
Trevor Gerber (Chairman)
Peter Huddle (CEO)
Clive Appleton
Tiffany Fuller
Tim Hammon
Michael Hawker AM
Peter Kahan
Janette Kendall
Georgina Lynch
Dion Werbeloff
Company Secretaries
Carolyn Reynolds
Rohan Abeyewardene
Registered office
Chadstone Tower One
Level 4, 1341 Dandenong Road
Chadstone VIC 3148 Australia
Telephone: +61 3 7001 4000
Facsimile: +61 3 7001 4001
Website: vicinity.com.au
Auditors
Ernst & Young
8 Exhibition Street
Melbourne VIC 3000 Australia
Security Registrar
If you have queries relating to your securityholding
or wish to update your personal or payment details,
please contact the Security Registrar.
Link Market Services Limited1
Tower 4, 727 Collins Street
Melbourne VIC 3008 Australia
General securityholder enquiries:
Toll Free: +61 1300 887 890
Facsimile: +61 2 9287 0303
Facsimile: +61 2 9287 0309
(for proxy voting)
Email: vicinity@linkmarketservices.com.au
Post: Locked Bag A14
Sydney South NSW 1235 Australia
Access your securityholding online
You can update your personal details and access
information about your securityholding online by clicking
‘Securityholder login’ on our home page at vicinity.com.au,
or via the ‘Investor Login’ section of the Security Registrar’s
website at linkmarketservices.com.au, or scan the
QR Code (below) to take you to the investor centre.
Securityholders can use the online system to:
҅ View your holding balances, distribution
payments and transaction history;
҅ Change your securityholder communications preferences;
҅ Confirm whether you have lodged your Tax File Number (TFN)
or Australian Business Number (ABN);
҅ Update your contact details;
҅ Update your bank account details;
҅ Check Vicinity Centres’ security price; and
҅ Download various securityholder instruction forms.
Contact Vicinity Centres
We are committed to delivering a high level
of service to all securityholders.
Should there be some way you feel that we can
improve our service, we would like to know.
Whether you are making a suggestion or a complaint,
your feedback is always appreciated.
Investor relations
Email: investor.relations@vicinity.com.au
The Responsible Entity is a member (member no. 28912)
of the Australian Financial Complaints Authority (AFCA),
an external dispute resolution scheme to handle complaints
from consumers in the financial system. If you are not satisfied
with the resolution of your complaint by the Responsible Entity,
you may refer your complaint to AFCA:
Telephone: 1800 931 678
Email: info@afca.org.au
Website: afca.org.au
Post: GPO Box 3
Melbourne VIC 3001 Australia
1. Link Group is now known as MUFG Pension & Market Services. Over the coming months, Link Market Services will
progressively rebrand to its new name MUFG Corporate Markets, a division of MUFG Pension & Market Services.
Follow us on
People
Chairman/CEO letter
Highlights
Introduction
Operating and financial review
Sustainability
Customers
Vicinity Centres | 2024 Annual Report
150
Intentional Blank Page
151
Sustainability assurance
Securityholders
Directory
Communities
Suppliers
Climate and environment
Risks
Governance
Tax
Financial report
Intentional Blank Page
People
Chairman/CEO letter
Highlights
Introduction
Operating and financial review
Sustainability
Customers
Vicinity Centres | 2024 Annual Report
152
People
Chairman/CEO letter
Highlights
Introduction
Operating and financial review
Sustainability
Customers
Vicinity Centres | 2024 Annual Report
152
Intentional Blank Page
designdavey
153
Sustainability assurance
Securityholders
Directory
Communities
Suppliers
Climate and environment
Risks
Governance
Tax
Financial report
VICINITY.COM.AU