UK and Europe shopping centre owner Hammerson has clocked up the largest sale of UK property in the past decade, letting go of seven retail parks as it decreases its exposure to Brexit-hit Britain.
Hammerson said on Friday it had sold the assets for £400m (R7.8bn) to Orion Real Estate Fund as part of its strategy to exit the retail parks sector over the medium term, to focus on flagship assets, premium outlets and city quarters in major European cities.
London-based Hammerson and other JSE-listed but UK-focused landlords, including Capital & Counties, Capital & Regional and Intu Properties, have been under pressure after Britain voted to leave the EU in 2016. This has dented business confidence and the perceived values of commercial property in the UK.
Online shopping has also caused some bricks-and-mortar stores to lose business and to close branches.
As a result, Hammerson has repositioned itself so that more of its portfolio can be in Europe than in the UK.
The company has sold 14 retail parks since July 2018, generating proceeds of £764m, which will be used to strengthen the group’s balance sheet.
The group still has an interest in one remaining retail park, Brent South, part of the Brent Cross estate, which is held in a joint venture with Aberdeen Standard Investments and is marked for sale.
“Against a challenged retail and investment backdrop we have exited the retail parks sector,” said CEO David Atkins. “Having achieved disposals of close to £1bn since the beginning of 2019, our focus remains on strengthening our balance sheet to create further resilience,” he said.
The focus on other types of assets is expected to create additional income stability and growth over the medium term, he said.
The company has its primary listing on the London Stock Exchange and a secondary inward listing on the JSE.
Would you like to comment on this article?
Sign up (it's quick and free) or sign in now.
Please read our Comment Policy before commenting.