David Jones has delivered another blow to Westfield's long- delayed $190 million expansion of Whitford City shopping centre by withdrawing as anchor tenant.
The department store operator said yesterday it decided not to proceed with an agreement signed six years ago to lease 12,000 sqm of retail space in the proposed Hillarys development.
Chief executive Paul Zahra said David Jones had decided it would get the same value through refurbishing its stores in Karrinyup and Booragoon.
"Whitford is not in our current plans because we think we're better off focusing on updating the current stores that we have in WA to bring them up to a more contemporary standard," Mr Zahra said. Times had changed since the deal in 2008.
"It doesn't mean we may not go into Whitford in the future but we would need to renegotiate the lease," he said.
Mr Zahra said the decision was not related to Westfield's difficulties in gaining approval for the 31,000 sqm expansion.
The plan was rejected by the City of Joondalup and a development assessment panel and is now before the State Administrative Tribunal.
In a submission last year, Westfield said attracting David Jones to complement the centre's role and function would only occur if the development was approved by October 31.
Property Council of Australia WA executive director Joe Lenzo said the delays were no doubt a factor for David Jones.
"Had the approval gone through in a timely manner you probably would have seen a David Jones at Whitford," Mr Lenzo said. "The fact it's now been bumbling along for three or four years didn't help.
"It does put a dampener on the potential for getting those sort of developments up and running."
Mr Lenzo said most shopping centre expansions depended on anchor tenants, which allowed specialty stores to feed off them.
The Westfield plan would add 90,000 sqm to the centre.
David Jones' decision follows Myer's move last year to close its Fremantle store after 40 years. Myer will open a new store next year at Lakeside Joondalup.
Westfield was contacted for comment.