Highlights

• Funds from operations rose to $700.1 million, or 15.21 cents per security, while statutory net profit reached $1,391.2 million.

• Net tangible assets climbed 19 cents to $2.59 per security as portfolio value reached $16.1 billion.

• Divestments of $327.2 million at an 18.2% premium accompanied the $212 million Uptown and $351 million DFO Eastern Creek acquisitions.

• FY27 guidance targets funds from operations of 16.0 to 16.2 cents per security and comparable income growth of 3.5%.

Vicinity Centres (ASX:VCX) spent FY26 selling smaller regional centres and buying into premium, high-traffic assets, and the numbers for the year to 30 June 2026 show the strategy feeding through to earnings. Funds from operations (FFO) rose to $700.1 million from $673.8 million, or 15.21 cents per security, which the company said sat at the top of its guidance. Shares were trading at A$2.41 on 23 October 2026, up 1.69%.

Premium Assets Now Carry Two-Thirds of the Portfolio

Premium centres now make up 67% of portfolio value, up from 51% in June 2022. Valuations followed: the portfolio reached $16.1 billion after a $293 million, or 1.8%, rise in the second half, the fifth consecutive positive six-month movement. Net tangible assets per security increased 19 cents, or 7.7%, to $2.59.

Comparable net property income grew 4.2%, occupancy stood at 99.6% and total portfolio retail sales rose 3.3%. Statutory net profit after tax rose to $1,391.2 million from $1,004.6 million.

Capital Recycling Funds Brisbane and Sydney Purchases

Vicinity sold Gympie Central, Whitsunday Plaza, Armidale Central, Victoria Park Central and ancillary land for $327.2 million, an 18.2% premium to June 2025 book values. A binding agreement in August 2026 to sell Taigum Square for $120 million lifts total disposals to $447.2 million at a blended 18.4% premium, with settlement expected in September 2026.

On the buying side, the group acquired DFO Eastern Creek for $351 million, excluding a $49 million large-format retail component held on a pass-through basis subject to landlord consent. The residual 75% of Uptown in the Brisbane CBD cost $212 million and settled on 14 August 2026.

Gearing was 26.1%, or 26.5% pro forma for Uptown and Taigum Square, at the lower end of the 25% to 35% target range.

Chatswood Chase and Chadstone Lead the Development Pipeline

The $625 million Chatswood Chase reimagining is complete, with Hermès, Rolex and Cartier joining the luxury precinct that opened in April 2026. Vicinity reported a stabilised yield of about 6.7% and an unlevered internal rate of return of about 11%. It expects a stabilised value near $1.5 billion. Two residential towers of roughly 480 apartments are in planning, with authority approval anticipated in 2027.

Dates and Targets for FY27

Vicinity declared a final distribution of 6.20 cents per security, taking the full-year payout to 12.4 cents, or 95.5% of adjusted FFO.

Several milestones are scheduled. Galleria in Perth is on track to open in November 2026 with a refurbished Myer and Coles, and the MECCA consolidation at Chadstone, which will more than double its footprint, is expected to open in time for Christmas 2026. Repositioning of Uptown is progressing through approvals, with a start planned in the first half of 2027. The annual general meeting is scheduled for 28 October 2026, when director Tim Hammon is due to retire from the board.

For FY27, the company guided to FFO of 16.0 to 16.2 cents per security, adjusted FFO of 13.9 to 14.1 cents and a payout ratio of 95% to 100% of adjusted FFO. It expects investment capital expenditure of about $300 million. Management described its stance as cautious confidence, citing geopolitical uncertainty and household financial pressures, and said guidance is subject to unforeseen circumstances.