Westfield Group's (ASX: WDC) Westfield London shopping centre is set to become the largest shopping centre across all of Europe with the shopping mall behemoth receiving the green light for a £1 billion ($1.8 billion) extension.
The extension will include another 61,840 square metres of retail space, 8,170 square metres of restaurants and cafes, up to 1,522 new homes as well as 3,500 square metres of leisure facilities in one of the shopping centre giant's largest redevelopments to date. Construction is expected to begin early next year while the doors to the expanded section should be opened by the end of 2017.
The redevelopment is a perfect reflection of the strategy the company has taken over recent years, which has seen it divest from non-core or underperforming centres and redeploy the proceeds into making its best stores even better. Accordingly, Westfield sold three of its other centres in the UK just weeks ago – namely Sprucefield, Derby and Merry Hill – which reaped the company £597 million.
While the centre has only been in operation for five years, Duncan Bower, the company's director of development, said such a massive investment in Westfield London is "testament to the strength of this centre". Currently, the centre generates almost £1 billion in sales as well as 28-million customer visits. The additional leisure facilities and construction of the nearby housing units in particular will pay enormous dividends in attracting even greater crowds.
Although exciting, Westfield London is by no means the company's only focus. It is also redeveloping the Croydon store, located in London's south, as well as the U.S. World Trade Centre shopping mall.
Foolish takeaway
Should Westfield's merger proposal with Westfield Retail Trust (ASX: WRT) receive the necessary approval, Westfield London and Croydon will form a part of the new Westfield Corporation, while its Australian and New Zealand assets would form Scentre Group. Given the exciting expansion taking place in Europe and the U.S., Westfield Group is definitely a company to consider adding to your portfolio. Its shares are currently trading at $10.42 on a P/E ratio of 15.6 times and offer a 5% dividend yield.
