UPDATE 1-Westfield reaffirms 2008 forecasts

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MELBOURNE, May 7 (Reuters) - Westfield Group (WDC.AX: Quote, Profile, Research, Stock Buzz), the world's top shopping mall owner by market value, reaffirmed it expected to pay a steady distribution this year and expected earnings growth to match last year, despite the U.S. economic slowdown.

Managing Director Steven Lowy said on Wednesday although retail sales growth had declined in the United States and Britain, the quality and location of the company's malls made it relatively resilient.

The U.S. is a key market for the group, accounting for 44 percent of the group's net rental income last year. Occupancy at Westfield's U.S. malls fell to 92.8 percent as of the end of March from 94.1 percent in December, which it blamed on its recent acquisition of two malls near Miami, Florida and a seasonal decline.

Managing Director Steven Lowy said the group expected occupancy to follow a normal trend and rise over the year to peak in the fourth quarter.

"But it depends on how prolonged and how harsh the impact is. In the United States, at the moment I think we're holding up quite well," Lowy told analysts at a briefing.

While some U.S. retailers were closing stores, Westfield's malls were not badly affected.

Bankrupt U.S. retailer Linens 'n Things is closing 120 stores, but only one of those is in a Westfield mall. And Walt Disney Co. (DIS.N: Quote, Profile, Research, Stock Buzz) is closing only five of the 30 stores it has in Westfield malls, Lowy said.

He said the group still expected to pay a full-year distribution of 106.5 cents a security this year, and expects operational segment earnings growth to match last year's level of 6 percent, in constant currency terms.