Napoleon may have uttered the now infamous quote that Britain was a “nation of shopkeepers”, though the origin of the quote is a matter of some debate, lost in the annals of time. However, these days, in commercial property circles, the question seems to be whether the UK is a nation of shopping centres rather than shopkeepers.
Speaking at the unveiling of Hammerson’s half-year financial results, David Atkins, when talking about the way major retailers are responding to the current economic climate, said “customers want all of the outlets they are visiting to be in one shopping centre. As a result, retailers are shedding units in small towns and secondary high streets, but keeping positions in large shopping centres.”
The past six months has seen Hammerson spend £373m on retail parks and malls, adding to a commercial property portfolio which includes such iconic mainstays as London’s Brent Cross shopping centre.
This is not to say Hammerson is on an acquisition strategy. “We should not be a collector of assets and every piece of our portfolio should be earning its keep or getting cut off from the bottom,” said the chief executive. A clear message that every commercial property in their portfolio must perform to expectations or suffer the threat of being sold off.
Hammerson is a substantial player in the commercial property investment and development market, which is why the media are busy analysing the figures, which show a 43 per cent decline in its profits. One City analyst described them as “a good set of numbers, but unlikely to shoot the lights out”.
In a retail sector where the lights have permanently gone out on some big high street names, Hammerson can point to an increase in rental income. They are currently running at 2.8 per cent, ahead of the previous year. A 6.1 per cent like-for-like rental growth in shopping centre occupancy levels was posted, taking the portfolio to 97.2 per cent occupied, 0.2 per cent above the trust’s target.
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