Stockland corporate reporting 2017

Our Strategy 

The primary objective of our Group business strategy is to deliver earnings per security growth and total risk-adjusted securityholder returns above the Australian Real Estate Investment Trust index average, by creating quality communities and property assets and delivering great customer experiences.

Our Group business strategy has three strategic priorities:

Responding to our challenges and opportunities

Stockland adopts a rigorous approach to understanding and proactively managing the risks faced in its business. 

We recognise that making business decisions that involve calculated risks, and managing these risks within sensible tolerances, is fundamental to creating long-term value for securityholders and meeting commitments to our employees, tenants, customers, business partners, consultants and the communities in which we do business. Various risks could impact our business, and the nature and potential impact of these risks change over time. For example, climate change risks and opportunities are reflected in several risks listed below: extreme weather events, changing regulation, and the ability to develop products that meet anticipated future demand.

Our risks include, but are not limited to, the list below.

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For more information on Stockland's materials matters see our Material Matters webpage.

Short term strategy execution

Continue to:

  • maintain a diversified business model at scale in each sector
  • reinvest in our assets to meet changing customer needs
  • focus on retaining a strong balance sheet with appropriate gearing
  • use diverse funding sources
  • concentrate on efficiency and cost management
  • maintain a prudent approach to provisioning
  • replenish our land and asset pipeline
  • maintain discipline and agility in our investment decision-making
  • use a rigorous whole-of-business approach informed by detailed research to drive our capital allocation process

As part of our continued investment in the efficiency of our operations, we have made significant progress on improving the Group’s systems capabilities including the successful implementation of Salesforce and SAP Success Factors. Deployment of further SAP and Salesforce capabilities will continue during next year. We continue to maintain two-way engagement with employees across the business to enable a smooth transition.

Our Residential business is influenced by the dynamics of the Australian housing market. Housing affordability remains of key concern for Australians as the price of housing and rental properties continues to increase. We believe a suite of measures is required to unlock housing supply and address affordability. Our affordability initiatives in Queensland, New South Wales and Victoria have given first home buyers priority to purchase land and get a foothold in the market.

We will also continue to:

  • partner with government and industry to drive solutions
  • provide a broader mix of value-for-money housing options including house and land packages, completed housing, medium density and apartments
  • balance the demand from home owners and investors so that our residential communities remain attractive to future buyers

Continue to:

  • train our employees and increase their risk awareness
  • undertake regular scenario testing
  • engage with peers and across industries
  • invest in asset upgrades and adapt community design to improve resilience
  • assess and implement wholesale energy strategies and renewable energy installations

The retail landscape is constantly evolving. Within the last 10 years the sector has sen a convergence of technical advances, in particular e-commerce, changes in underlying consumer behaviour, and the entry of new, international retailers. These changes have challenges some of our retailers.

We have been proactive and have pre-empted many of the changes. We continue to:

  • focus on experiential retail, services, food catering
  • redevelop our assets to create diverse, walkable town centres that form the social hub of the community
  • leverage deep customer insights and analytics to inform our tenant remixing

Continue to:

  • engage with industry and government on policy areas including taxation and planning reform
  • develop in areas where governments support growth
  • focus on good practice to remain well positioned in the market and prepared for potential regulatory changes

Longer term changing marketplace

Continue to:

  • foster a culture of innovation where we remain flexible, and identify and take advantage of opportunities to leverage movements in stakeholder preferences
  • evolve our market-leading product innovation and deepen our customer insights using our proprietary Liveability Index research, Stockland Exchange (our online research community), Quantium (which provides data-driven customer insights to inform how we view markets and opportunities) and other data sources
  • focus on creating sustainable and liveable communities and assets, resilient to changes in climate
  • enhance our design excellence, providing greater functionality and value for money that meet demands of Australia's changing demographics, including an ageing population and more socially conscious Millennials

Continue to:

  • identify, develop and integrate technical enhancements across our business, including online residential and retirement living engagement opportunities
  • support Stockland retail centres as thriving community hubs by delivering quality services and community spaces that are e-enabled
  • promote employee innovation and collaboration through Ideas@Stockland to further enable us to take advantage of new opportunities

Our long-term growth is dependent on our ability to access capital at the appropriate time and cost even as capital markets fluctuate in response to domestic and global economic shifts. Variable economic activity and changing capitalisation rates may impact the valuation of our assets.

So that we are able to continue to raise sufficient capital to fund growth, we will continue to:

  • focus on retaining a strong balance sheet at appropriate levels of gearing
  • maintain and increase access to diverse funding sources
  • maintain our prudent capital management policies 

Physical and organisational boundaries are becoming increasingly blurred as new technology enables greater workplace flexibility, including when and where employees work, and encouraging creative and adaptive teamwork. This year we successfully deployed Office365, Salesforce, and SAP SuccessFactors to improve collaboration and flexible working. We will continue to:

  • encourage flexible work practices supported by our new collaboration platforms
  • train our senior leaders to be more agile and resilient through progress such as our Stockland Leadership Experience

Community expectations on the social and behavioural operations of a "good corporate" are changing. Corporates are increasingly expected to work in partnership with the community and government on societal issues. We are well placed to meet these expectations and have a strong reputation for sustainability leadership and community development.

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Risk management

The risks and opportunities listed above align with our material matters. Information on Stockland's risk management policy is available on the Corporate Governance webpage.

Download Reports

Stockland Annual Review 2017

Annual Review

Stockland Corporate Reporting 2017

Financial Report

Stockland Corporate Reporting 2017

Property Portfolio

The community garden at Stockland's Bells Reach community on the Sunshine Coast (Qld)