Hammerson plans future developments in UK, France and Ireland

Hammerson, the owner of prominent shopping centers like the Bullring in Birmingham and Cabot Circus in Bristol, has reported impressive full-year financial results that have exceeded expectations. The company's Chief Executive Officer, David Atkins, attributes this success to a well-diversified business model across Europe, with a focus on shopping centers, retail parks, and premium outlets. During a recent interview on CNBC Africa, Atkins highlighted the key drivers behind Hammerson's strong performance. Atkins pointed out that all sectors of the business experienced robust growth, with the core portfolio of shopping centers recording a 2.2% increase in income. When including outlets, this growth rose to 3.2%, while premium outlets saw a significant 7.6% growth in net rental income. These positive results translated into a 7.6% increase in earnings and dividends for the company. The success of Hammerson's financial year was further bolstered by a successful debt refinancing strategy, which enabled the company to reduce its cost of debt and expand into new markets. One of the key highlights of Hammerson's financial strategy has been its intentional diversification across the UK and Europe. With 60% of its assets in the UK and 42% in Europe, the company was able to navigate the uncertainties surrounding Brexit successfully. The depreciation of the sterling following the referendum actually had a positive short-term impact on the company's earnings and net asset value due to the increase in value of euro-denominated assets. However, Atkins acknowledged that there might be some headwinds ahead due to the depreciation of sterling affecting dollar-denominated costs, potentially leading to marginal erosion for the retail sector. Despite these challenges, Hammerson remains optimistic about its future income growth target of 2% plus, driven by the strength of leasing demand for its assets. Looking ahead, Hammerson is keen on expanding its presence in strategic markets such as London, Paris, and Dublin. The company has a substantial development pipeline worth 1.5 billion sterling, which will focus on enhancing returns in its core markets. While exploring new markets, Hammerson prioritizes cities with growing catchments and strong local economies. Dublin serves as a prime example where the company has successfully invested over a billion sterling, capitalizing on the city's thriving economy and retail landscape. By identifying cities with the potential for increased market share and leasing demand, Hammerson aims to drive income growth above market averages. In conclusion, Hammerson's strong financial performance and strategic expansion plans underscore its resilience and adaptability in a dynamic market environment. With a focus on maximizing returns through diversified assets and strategic investments, the company is well-positioned to capitalize on growth opportunities in key markets across Europe. As Hammerson continues to evolve and expand its footprint, investors will be closely watching its progress and future developments in the retail property sector.