WESTPAC is increasing the pressure on retail landlords to come to the party with some rent relief and flexibility for its new-look branches, or risk losing the bank as a tenant.
Bank branches are some of the many tenants in malls that will undergo significant change in layouts in the next few years. These changes will be driven by department stores, which plan to shrink the floor space, and food outlets, which will expand. To cater for the shifts in demand, landlords are already being flexible with opening hours and shop layouts.
New space is being allocated for pop-up stores and shorter-term leases, and landlords are being flexible on different trading times.
A Westfield representative said discussions with tenants and their needs occurred daily and, where possible, changes could be made.
Under its new plan, Westpac will invest an initial $240 million to upgrade its network of 680 branches across the country.
This will result in branches shrinking from an average of 350 square metres to about 230 sqm as tellers are removed and replaced by open-plan "kiosks" featuring couches and meeting areas.
Automatic teller machines will be upgraded to allow customers to do the bulk of their banking without having to deal with a teller. In these instances the bank is looking for street-frontage access.
In a first phase, Westpac plans to refurbish a third of its existing branches over the next three years in its "Bank Now" format. The rest will be upgraded as leases expire.
According to Westpac's property division, discussions are under way with all landlords, including Westfield, CFS Retail and Stockland, on the new formats. If no solution can be reached the bank could move out of centres to suburban strips.
CFS Retail said malls were conscious of the changing needs of tenants and landlords were trying to accommodate these.
The group executive of Westpac's retail and business banking, Jason Yetton, said the introduction of Bank Now branches was a direct response to customers' needs."
"The advent of mobile banking, first through smartphones and now tablets, has completely altered the way our customers bank with us and as a result they want more advice from our staff about how to get the most out of their finances," Mr Yetton said.
Frequently Asked Questions about this Article…
What is Westpac's new 'Bank Now' branch plan and how much will it cost?
Westpac will invest an initial $240 million to roll out its 'Bank Now' format across its network of 680 branches, beginning with refurbishing about one third of branches over the next three years and upgrading the rest as leases expire.
How will Westpac branch layouts change under the upgrade?
Branches will shrink from an average of 350 sqm to about 230 sqm, remove traditional tellers in favour of open‑plan kiosks with couches and meeting areas, and upgrade ATMs so customers can do the bulk of banking without a teller.
Why is Westpac asking mall landlords for rent relief and greater flexibility?
Westpac wants landlords to accommodate smaller, street‑frontage formats and different trading arrangements for its new branches; if landlords won't provide rent relief or flexibility, the bank says it could move out of centres to suburban strips.
Which major mall landlords is Westpac negotiating with about the new formats?
Westpac's property division says discussions are under way with major landlords including Westfield, CFS Retail and Stockland on how to accommodate the new branch formats.
How are shopping centres changing and what does that mean for tenants?
Malls are reallocating space as department stores plan to shrink and food outlets expand, leading landlords to offer pop‑up space, shorter leases, flexible shop layouts and trading hours to meet changing tenant demand.
Could Westpac leave shopping centres if landlords don't cooperate?
Yes. The article says Westpac could move out of centres to suburban high‑street locations if no solution with landlords can be reached.
How will upgraded ATMs and digital banking affect branch services?
Upgraded ATMs are intended to let customers complete most routine banking without a teller, shifting branch staff toward providing face‑to‑face financial advice and assistance in the new open‑plan formats.
What reason does Westpac give for changing branch formats and focusing more on advice?
Jason Yetton, Westpac's retail and business banking executive, says mobile banking via smartphones and tablets has changed how customers bank, so they now want more in‑branch advice about getting the most from their finances.
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