Image source: © 2025 Krish Capital Pty. Ltd.

Highlights

  • Vicinity reported NPAT of AUD 1,004.6 million in FY25, compared with AUD 547.1 million in the prior year.

  • Funds From Operations (FFO) increased by 1.4% to AUD 673.8 million, or 3.6% when adjusted for one-off items and higher rent loss from developments.

  • Occupancy remained at 99.5%, while leasing spreads improved by 2.5% and specialty sales rose 4.7% in 2H FY25 compared with the prior period.

Vicinity Centres (ASX:VCX) has announced its results for the year ended 30 June 2025 (FY25), recording a statutory net profit after tax (NPAT) of AUD 1,004.6 million, up from AUD 547.1 million in FY24. The company highlighted steady performance across key operational and financial metrics, supported by its asset management and development strategy.

During FY25, Vicinity delivered FFO per security of 14.8 cents, which was at the top end of its guidance range of 14.5 to 14.8 cents per security. The company declared a final distribution of 6.05 cents per security, taking the total FY25 distribution to 12.00 cents, compared with 11.75 cents in FY24. The payout ratio was 95.4% of Adjusted FFO.

Vicinity advanced its investment strategy through acquisitions and divestments. It acquired Lakeside Joondalup, a premium retail asset with future growth potential, while divesting non-strategic assets at more than 5% above book values. At Chadstone, the company opened the revitalised Market Pavilion fresh food and dining precinct, which has exceeded expectations. In the June 2025 quarter, Chadstone’s visitation was up 36% year-on-year, while static centre sales rose 4.4%.

The Chatswood Chase development, which is positioned to become northern Sydney’s fashion precinct, is progressing, with the first stage scheduled to open in the second quarter of FY26. Leasing commitments for the project are largely complete.

Comparable Net Property Income (NPI) increased by 3.7% in FY25, while headline NPI rose 3.3%. Retail sales grew by 2.8% during the year, underpinned by retailer demand and tenant remixing. Portfolio occupancy closed at 99.5%. Leasing activity delivered spreads of 2.5%, annual escalators on new leases averaged 4.8%, and specialty and mini majors’ sales grew 4.7% in the second half of FY25 compared to the same period in FY24.

Vicinity reported a specialty occupancy cost ratio of 14.1%, indicating potential for further leasing momentum and rent growth. The company ended the year with gearing of 26.6%, at the lower end of its 25–35% target range, providing capacity for future growth investment.

Looking ahead, Vicinity expects retail developments to shift towards small to medium-scale projects that enhance the customer experience. On the mixed-use development front, Vicinity is progressing opportunities at Bankstown Central and Chatswood Chase. Following the NSW Government’s approval of the Bankstown Rezoning Proposal in November 2024, residential development adjacent to Bankstown Central and the upcoming Metro station is positioned to move forward. Similarly, Chatswood Chase presents opportunities for high-density residential projects, with both locations endorsed for inclusion in the Housing Development Authority’s accelerated planning pathway.

Vicinity stated it is evaluating a range of operating and funding models for these projects while maintaining flexibility in execution to achieve risk-adjusted returns for securityholders.