Westfield's $3bn write-down sent the benchmark property index down to a level last reached in 1986.
The write-downs on the value of its shopping centres sent tremors through the listed property sector yesterday.
The S&P/ASX 200 REITs Index briefly touched 786.4 points in morning trading as Westfield shares plunged from $12.10 to a low of $11.20. It recovered to close 1.3% lower at 802 as Westfield shares rebounded to finish at $11.98, for a 12c loss on the day.
Shaw Stockbroking's head of industrial research, Scott Marshall, said Westfield and Stockland led in the downward slide. He said the market expected rental growth for shopping centres to be "zero" in the next six to 12 months.