Highlights:

  • Vicinity Centres (ASX:VCX) securities were trading at AUD 2.590, up 2.371% on 20 August 2026.
  • FY2026 statutory net profit after tax increased to $1,391.2 million from $1,004.6 million in FY2025.
  • Funds From Operations (FFO) increased to $700.1 million, with FFO per security rising 4.1% on an adjusted basis.
  • FY2026 distribution reached 12.4 cents per security, with Net Tangible Assets increasing 7.7% to $2.59 per security.
  • Vicinity expects FY2027 FFO per security of 16.0 to 16.2 cents, supported by Portfolio Investment and development activity.

Vicinity Centres (ASX:VCX) has reported FY2026 results, highlighting growth in statutory earnings, portfolio repositioning, asset acquisitions, and development progress across its retail property portfolio.

Vicinity Centres securities were trading at AUD 2.590, up 2.371% on 20 August 2026. The company’s annual results showed statutory net profit after tax of $1,391.2 million, Funds From Operations (FFO) of $700.1 million, and continued investment across key retail assets.

Vicinity Centres owns and manages a portfolio of retail properties across Australia, with the company reporting $26 billion in retail assets under management across 49 shopping centres.

FY2026 Financial Results and Distribution

Vicinity Centres reported statutory net profit after tax of $1,391.2 million for FY2026, compared with $1,004.6 million in FY2025.

Funds From Operations increased to $700.1 million from $673.8 million in the prior year, with FFO per security reaching 15.21 cents compared with 14.79 cents in FY2025. On an adjusted basis, FFO per security increased 4.1%.

The Board declared a final distribution of 6.20 cents per security for 2H FY26, taking the full year distribution to 12.40 cents per security. The distribution represented a Payout Ratio of 95.5% of Adjusted Funds From Operations.

Net Tangible Assets increased to $2.59 per security, rising 19 cents or 7.7% over FY2026, supported by income growth and investor Demand for retail assets.

Portfolio Repositioning and Capital Recycling

Vicinity continued its strategy of reshaping its portfolio through acquisitions, developments, and asset sales during FY2026.

Premium assets accounted for 67% of portfolio value, increasing from 51% in June 2022. The company attributed this shift to strategic acquisitions, development investment, capital recycling, leasing activity, and asset management.

During FY2026, Vicinity acquired DFO Eastern Creek for $351 million and completed the Acquisition of the remaining 75% interest in Uptown for $212 million.

The company also divested non-strategic assets including Gympie Central, Whitsunday Plaza, Armidale Central, Victoria Park Central, and ancillary land parcels for $327.2 million. In August 2026, Vicinity entered binding agreements to divest Taigum Square for $120 million, bringing total divestments to $447.2 million.

The company said these transactions released capital for reinvestment into assets with greater strategic relevance and income growth potential.

Retail Portfolio Performance and Leasing Metrics

Vicinity reported comparable Net Property Income (NPI) growth of 4.2% during FY2026, supported by leasing and property management activity.

Total portfolio retail sales increased 3.3% over the year, with specialty and mini major sales increasing 4.0%. Specialty sales productivity reached $13,512 per square metre, marking the seventh consecutive six-month period of growth.

Occupancy increased to 99.6%, while leasing spreads reached +4.2% and annual rental escalators remained at +4.8% on completed deals.

The company noted that retail conditions varied across categories, with second-half sales growth moderating amid cost-of-living pressures, higher interest rates, inflation, and geopolitical uncertainty.

Development Projects Progress Across Key Assets

Vicinity continued development activity across several major retail assets during FY2026.

The $625 million redevelopment of Chatswood Chase has been completed, with the centre now featuring luxury retail brands, premium dining, and fresh food offerings. The company said expected project returns have increased, with stabilised Yield and unlevered internal rate of return rising to approximately 6.7% and 11%, respectively.

Upon stabilisation, Chatswood Chase is expected to be valued at approximately $1.5 billion, representing an estimated development profit of more than $250 million based on management forecasts.

At Chadstone, MECCA flagship expansion works are progressing, with the expanded store expected to open before Christmas 2026.

The transformation of Galleria in Perth remains on track for opening in November 2026, including a refreshed retail precinct, entertainment area, cinema, and updated dining offering.

FY2027 Outlook and Earnings Guidance

Vicinity said FY2027 represents an important period as its portfolio repositioning begins contributing to earnings growth.

The company expects FY2027 FFO per security to be between 16.0 and 16.2 cents, while Adjusted Funds From Operations per security is expected between 13.9 and 14.1 cents.

Comparable NPI growth is expected at 3.5%, compared with 4.2% in FY2026. The company expects development-related lost rent of approximately $18 million, compared with $27 million in FY2026.

Maintenance Capital Expenditure and leasing incentives are expected to remain around $100 million, while investment capital expenditure is forecast at approximately $300 million.

Vicinity expects the full year distribution payout ratio to remain within its target range of 95% to 100% of Adjusted Funds From Operations.

Investor Takeaway

Vicinity Centres’ FY2026 results highlight continued portfolio repositioning, higher asset quality, and progress across major development projects. The company reported increased statutory earnings, maintained distributions, and provided FY2027 guidance reflecting expected contributions from acquisitions and completed developments.

Investors may continue to monitor retail trading conditions, leasing performance, development delivery, capital allocation decisions, and progress against FY2027 earnings expectations.