Hammerson, the commercial property giant, has reported strong sales and footfall in the first quarter of the year, which is good news ahead of its upcoming shareholders meeting. CEO Rita-Rose Gagné emphasized the company’s “strong operational grip” and its ability to achieve top-line growth in a recent trading update. Gagné also highlighted a strong leasing pipeline and reduced costs, indicating Hammerson’s commitment to creating a sustainable and agile platform.
The Bullring/Grand Central in Birmingham, Bicester Village Designer Outlet Centre in Oxfordshire, and several other shopping centers across Europe were among Hammerson’s key properties that contributed to its successful Q1 performance. Gross rental income grew by 5% on a like-for-like basis, reflecting robust leasing, while like-for-like net rental income also saw a 5% increase. This growth can be attributed to solid collections, lower bad debt charges, and reduced tenant incentive impairments.
Value Retail, the owner of Bicester Village, also reported a strong start to the year, with a 3% increase in spend per visit. The UK and Ireland saw positive trends in footfall, with a 6% and 13% year-on-year increase, respectively. Hammerson’s sales in the UK rose by 6% and by 7% in Ireland during the first quarter. Value Retail experienced a remarkable 14% year-on-year increase in footfall, resulting in a 17% rise in sales for the sector.
Hammerson’s cost-cutting measures have been successful, as gross administration costs decreased by 13% year-on-year. This reduction aligns with the company’s goal of achieving a 20% decrease by the end of 2024. The company has also been active in leasing, signing 61 deals year-to-date, amounting to £9 million in rent on a 100% basis. The headline rent is 18% higher than the previous passing rent, and 5% higher than the estimated rental value on a net effective basis.
In terms of asset management, Hammerson has divested minority stakes in France and other non-core interests, generating over £840 million in total disposals since the beginning of 2021. This strategic move allows the company to refocus on its core portfolio of city center assets.
Looking ahead, Gagné expressed confidence in Hammerson’s momentum. The company continues to demonstrate resilience and strength in the face of challenges, and its strong performance in Q1 sets a positive tone for the future. With ongoing leasing activity, reduced costs, and a renewed focus on core assets, Hammerson is well-positioned to navigate the ever-changing retail landscape.
Useful links:
1. Hammerson Share Price Data
2. Value Retail Official Website
