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(qlmbusinessnews.com via theguardian.com – – Tue, 24th July 2018) London, Uk – –
UK shopping centre operator to offload retail parks and reduce exposure to department stores
Hammerson, the UK shopping centre operator, plans to sell its portfolio of out-of-town retail parks and reduce exposure to department stores in a bid to appease disgruntled investors.
The owner of London’s Brent Cross and Birmingham’s Bullring aims to offload £1.1bn of properties by the end of 2019 as it exits the retail park sector and focuses on “flagship retail destinations”.
Hammerson now owns 13 retail parks across the UK, after announcing on Monday that it had agreed to sell its Imperial retail park in Bristol and Fife Central retail park in Kirkcaldy for a total of £164m to the property investment firm Capreon.
The shift follows Hammerson’s decision in April to abandon a £3.4bn buyout of its smaller rival Intu, the company behind Manchester’s Trafford centre, after pressure from investors concerned about the health of UK retailers.
David Atkins, the Hammerson chief executive, said on Tuesday it was changing its strategy to address the shift in the wider retail market.
“Through increasing the level of disposals, including exiting the retail parks sector, we will now focus solely on winning destinations of the highest quality: flagship retail destinations and premium outlets,” he said. “These are the venues we believe will maintain relevance and outperform against the shifting retail backdrop.”
Hammerson said it would cut by a quarter the amount of space given over to department stores, while high street fashion space would be reduced by a fifth, replaced by “aspirational fashion, leisure, events and lifestyle spaces”.
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It comes as Britain’s department store chains and other high street retailers struggle against a backdrop of higher costs, waning consumer confidence, and competition from online-only retailers.
Debenhams has issued three profit warnings since Christmas and came under fresh pressure last week when it emerged that credit insurers had reduced cover for suppliers to the company.
House of Fraser announced last month that it would close 31 of its 59 stores in the UK, including its flagship shop on London’s Oxford Street, with .
Hammerson also announced that it was shrinking its board, reducing the number of executive directors from four to two.
Peter Cole, the chief investment officer, will step down from the board at the end of 2018, after 29 years with the property company.
Jean-Philippe Mouton will also step down from the board at the end of the year, but he will remain in his role as managing director of the company’s French business and will continue to be responsible for marketing.
Shares rose 1.6% to 534p.
By Angela Monaghan
