Woolworths Denies Land-Banking Claims Amid ACCC Inquiry into Supermarket Practices
Woolworths has denied accusations of land-banking to block competitors from entering certain areas. This statement came during a hearing by the Australian Competition and Consumer Commission (ACCC) regarding supermarket pricing.
Ralph Kemmler, Woolworths’ property head, explained that the company owns shopping centers, even if some do not host a supermarket. According to Kemmler, none of these centers feature both a Woolworths and a Coles supermarket.
A document from March 2023 mentioned that Woolworths holds land for “strategic reasons” that are not currently planned for development. ACCC barrister Naomi Sharp questioned Kemmler about this claim, asking if it constituted land banking. Kemmler maintained that it does not.
Sharp pressed further, inquiring about the meaning of “strategic reasons.” Kemmler indicated that this could include company housing, land not yet sold from completed developments, and land with long-term leases already used for other purposes. Sharp expressed skepticism over Kemmler’s explanation.
What are the implications of the ACCC hearing for Woolworths’ future property strategies?
Woolworths Denies Land-Banking Accusations in ACCC Hearing
In a recent hearing conducted by the Australian Competition and Consumer Commission (ACCC) concerning supermarket pricing, Woolworths faced scrutiny regarding its property practices. Ralph Kemmler, the company’s head of property, defended Woolworths against allegations of land-banking aimed at obstructing competitors such as Coles.
Kemmler emphasized that Woolworths owns various shopping centers, including those that do not house a supermarket. He pointed out that none of these centers host both a Woolworths and a Coles supermarket, suggesting that their ownership of land is not intended to limit competition.
During the hearing, ACCC barrister Naomi Sharp cited a March 2023 document indicating that Woolworths maintains land for “strategic reasons” which are not currently slated for development. Sharp pressed Kemmler on whether this practice amounted to land-banking, to which he firmly responded that it did not.
Sharp further inquired about what Kemmler meant by “strategic reasons.” Kemmler clarified that it could refer to various factors, including company housing, undeveloped land from completed projects, and holdings with long-term leases already allocated for different uses. However, Sharp remained skeptical of his explanations, challenging the clarity and validity of the strategic definitions provided.
Kemmler described the “strategic” sites as fitting outside conventional categories but faced sharp criticism from Sharp regarding the lack of concrete clarity in his responses.
As the hearing unfolds, Woolworths aims to clarify its property strategy amidst increasing scrutiny over its market practices, hoping to alleviate concerns regarding competition and consumer choice in the supermarket sector.
Kemmler described the “strategic” sites as those that did not fit into any other categories. Sharp responded critically, questioning the clarity of his definition.
Overall, Woolworths strives to clarify its property strategy amid scrutiny over its market practices.