Shopping centre giant Westfield Group (ASX: WDC) will play a key role in the long awaited redevelopment of Los Angeles International (LAX), where it will focus on drastically improving the dining and retail facilities at one of the world's busiest airports.
In what will be the largest project in the airport's history, LAX has committed to spending US$1.9 billion on upgrading the Tom Bradley International Terminal (TBIT) in an attempt to alter poor perceptions by improving services such as baggage handling and time spent in the immigration processing line.
Another common complaint amongst customers is the lack of decent shopping and dining options at the main gateway to the US. Westfield will aim to combat this, with the company's co-chief executive Peter Lowy telling The Australian Financial Review that customers should not leave with a "ubiquitous mall", but instead "leave with the taste of the city they are in".
The dining and retail options will aim to attract travelers away from the lounge areas and into the 60,000 square feet centre which the company expects to achieve sales of US$15,000 per square metre – a similar figure achieved at other high-end shopping centres such as Westfield Sydney. This seems like a realistic target considering the popularity of retail in airports (retail is Sydney Airport's (ASX: SYD) second largest revenue earner).
Alan Joyce, chief executive of Qantas (ASX: QAN), stated that "At the moment, a lot of people are coming into the lounges because there is nothing else to do. Now they can go shopping and to restaurants also in the terminal. That will make a big difference."
Pleased with the modernisation, Joyce acknowledged that the fact Westfield was managing the retail meant that the improvement was "huge". Qantas isn't the only airline pleased with the upgrades, with Air New Zealand (ASX: AIZ) also believing that the redeveloped terminal will provide customers with a better experience from when it moves its operations to TBIT as of next October.
According to The Australian Financial Review, Westfield has spent US$79.8 million putting in place the dining and non-duty free retail options at the new portion of the terminal.
Foolish Takeaway
Westfield's decision to be involved in the redevelopment of LAX is a reflection of its overall strategy to invest in centres that maintain excellent prospects, whilst divesting non-core assets. It seems that the company is making all the right moves and, at today's price, would make for an excellent addition to your portfolio.
Alternatively, are you in the market for high yielding ASX shares? Get "3 Stocks for the Great Dividend Boom" in our special FREE report. Click here now to find out the names, stock symbols, and full research for our three favourite income ideas, all completely free!
More Reading
- Westfield goes turbo on share buyback program, should you be buying too?
- Westfield's Jersey tax haven
- 3 property stocks to watch
- Are Coles and Woolworths struggling?
Motley Fool contributor Ryan Newman does not own shares in any of the companies mentioned.
