Westfield Group to acquire 15 Federated Department Store sites

17 February 2006

Countries: United States

The Westfield Group (ASX: WDC) announced today it had agreed to acquire 15 department store sites owned by Federated Department Stores, Inc. at 11 Westfield shopping centres in the United States.

Federated Department Stores previously announced that it would dispose of 84 surplus stores as part of their acquisition of The May Department Stores Company.

Westfield will acquire the15 stores in two separate transactions. The acquisition of 12 of the stores will be in exchange for 12 department store properties currently owned by Westfield and leased to May Company. The 12 stores to be exchanged were originally acquired by Westfield as part of the CenterMark transaction in 1994. Of these 12 stores only two are located in Westfield centres. The current income from those sites is US$7.88 million per annum. In the second transaction, Westfield will acquire three stores for US$18.5 million.

Separately, Westfield and Federated have agreed upon 18 new redevelopments at Westfield-owned shopping centres.

We are extremely pleased with the transactions, which are the result of our two companies working very closely together for months to achieve a significant future redevelopment pipeline, said Group Managing Director Mr Peter Lowy. The acquisition creates new opportunities to further reinvest in and improve our portfolio, enabling over US$2 billion of new redevelopments to be initiated in the next four years. These are expected to generate income yields on cost of 9.5-10% (including costs to Federated).

As part of these redevelopments Westfield is negotiating with other anchor stores including Nordstrom, JCPenney and Target, as well as cinema operators, lifestyle retailers and signature restaurants.

Westfield has a strong track record in the US of acquiring and redeveloping former department stores to reorient the merchandise mix with new anchor stores, specialty shops and/or new restaurant, entertainment, and lifestyle precincts.

This is a terrific opportunity to further revitalize our properties by both strengthening Federateds market presence and opening up the ability for major expansion and renovation, said Westfield US Managing Director, Ken Wong.

The transactions are expected to be completed in the 2nd Quarter of 2006.



15 Department Store Sites in 11 Westfield Centres

Centre Name Centre Location Store Name

1. Westfield Fox Hills Culver City, CA Robinsons-May

2. Westfield MainPlace Santa Ana, CA Robinsons-May North

3. Westfield MainPlace Santa Ana, CA Macys

4. Westfield North County Escondido, CA Robinsons-May North

5. Westfield North County Escondido, CA Macys

6. Westfield Palm Desert Palm Desert, CA Macys Apparel

7. Westfield Palm Desert Palm Desert, CA Macys Home

8. Westfield PCR Carlsbad, CA Robinsons-May

9. Westfield Richland Mansfield, OH Macys

10. Westfield Santa Anita Arcadia, CA Robinsons-May

11. Westfield Trumbull Trumbull, CT Macys

12. Westfield UTC San Diego, CA Robinsons-May

13. Westfield UTC San Diego, CA Macys

14. Westfield West Covina West Covina, CA Macys

15. Westfield Wheaton Wheaton, MD Hechts

The Westfield Group (ASX Code: WDC) is an internally managed, vertically integrated, shopping centre group undertaking ownership, development, design, construction, funds/asset management, property management, leasing and marketing activities and employing in excess of 4,000 staff worldwide. It has investment interests in 128 shopping centres in four countries, with a total value in excess of A$44.5 billion (US$33.2 billion) and is the largest retail property group in the world by equity market capitalisation.