In 2020, Hammerson, a prominent player in the shopping mall industry, encountered formidable obstacles as the COVID-19 pandemic wreaked havoc on the retail sector. The company faced a dire situation as tenants struggled to meet rent obligations and stores shuttered their doors for prolonged periods. This challenging environment led to Hammerson announcing a colossal IFRS loss of £1.7 billion for the year, mainly attributed to a property revaluation deficit.
Notably, Hammerson’s portfolio valuation took a nosedive by year-end, plummeting from £8.327 billion to £6.388 billion. The decline was widespread, affecting all sectors within the company. The UK flagships’ capital return suffered a significant drop of 35.8%, while French flagships were down by 15.3%, Ireland flagships by 17.5%, retail parks by 23.3%, and Value Retail outlets by 6.2%.
Moreover, the group’s occupancy rate decreased to 94.3% from 97.2%, and leasing activity saw a 35% reduction compared to the previous year. CEO Rita-Rose Gagné candidly acknowledged the unparalleled challenges faced by Hammerson in 2020, underscoring the pandemic’s profound impact on the retail landscape.
Despite the adversity, Gagné remains hopeful about the future, underscoring the significance of human connection and social engagement. She envisions Hammerson as a pivotal player in facilitating communal spaces where individuals can converge, foreseeing the company’s role in shaping neighborhoods and communities in the times ahead.
In navigating through the pandemic’s turmoil, Hammerson is honing its focus on fortifying its financial position through additional disposals, strategic refinancing, and operational enhancements to optimize revenue generation. The company has also embarked on an extensive strategic and organizational assessment to forge a path for sustainable growth and reshape its business amidst economic uncertainties and transformative shifts in the retail sector. Ultimately, Hammerson’s aim is to leverage the quality of its destinations to propel its business into a promising future post-pandemic era.
To learn more about Hammerson’s strategic initiatives and future plans, visit their official website here. Additionally, for more insights on the impact of the COVID-19 pandemic on the retail sector, check out this informative article here.
