Yesterday’s announcement
that David Jones would be opening stores in three
Westfield centres is a footnote to
the acquisition of Myer by Newbridge Capital earlier this year.

Stephen Mayne wrote
last month of the opportunities opening up for David Jones during the sale
negotiations. Clauses in Myer leases
with Westfield had kept David Jones
out of centres.

During the Myer bidding process,
DJs CEO Mark McInnes indicated he might be
interested in a few Myer sites. Most
industry observers saw this as a bit of sledging – a mischievous remark that was
code for “You’re stuffed – you’ve only got a few good stores”

If Myer leases with
Westfield contained clauses
excluding DJs from those centres, it is probable that leases relating to other
centres contain similar clauses. Might
we now expect to hear of further planned DJs openings in other centres where
Myer was the sole department store?

The difficulty might be in the
demographics. Some
Westfield centres, such as
Melbourne’s Highpoint and
Sydney’s
Liverpool, are in areas that are more Reject Shop than
David Jones. The household incomes
surrounding Westfield Burwood (NSW) centre must be seen as marginal and may have
been the subject of an interesting debate.

If McInnes can see a way to cut a
profit in some other centres, he may have achieved a beautiful outcome, without
paying CML a cent. The Agetoday
is quoting new chief Bernie Brookes about plans for new and refurbished Myer
stores. The battle is on.

Peter Fray

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