Highcross owner sees its property portfolio value fall by 4.3% in 2018

Next at Highcross, Leicester
Next at Highcross, Leicester

The company that sold 50% of the Highcross Centre in Leicester to M&G Real Estate for £236m last year has seen its UK property values fall by 4.3% in 2018.

Hammerson has been “impacted by a weaker investment market,” and has a 2019 disposal target of £500m, which would bring Hammerson’s net debt below £3bn by the end of the year.

David Atkins, Chief Executive of Hammerson, said: “2018 was a tough year particularly in the UK. Tenant failures, the structural shift in retail and a more considered consumer created a difficult operating environment, putting pressure on property values. Outside of the UK our destinations performed better with a strong contribution from premium outlets.

“We believe that a successful deleveraging programme will best position Hammerson for the current environment and beyond. Disposals will also enable us to prove the inherent value of this business – which we believe is not recognised in the current equity market.

“Having successfully achieved £570m of disposals in 2018, we are aiming to dispose of at least £500m in 2019. We remain committed to exiting retail parks over the medium term and are in active portfolio-wide discussions on transactions of over £900m, which would add further strength to our balance sheet.

“Over the longer term we will generate opportunities to create additional value through City Quarters, which will see us transform many of our city venues beyond pure retail into successful, thriving neighbourhoods. The job of creating flagship spaces is never done, but through expert management, innovation and investment we are confident in the future of Hammerson and in maximising value creation for shareholders.”