Hammerson's pre-tax profits more than double as shoppers return

For the first time since the financial crash, Hammerson is able to charge higher rents across its £6.7bn portfolio

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The Independent Online

A consumer spending revival and rising property values more than doubled profits at the shopping centre owner and developer Hammerson.

About 250 million people a year visits the company’s 22 shopping malls in the UK and France, including Birmingham’s Bullring, Highcross in Leicester, Silverburn in Glasgow, Union Square in Aberdeen, Victoria Quarter in Leeds, WestQuay in Southampton and Brent Cross in north London.

For the first time since the financial crash, Hammerson is able to charge higher rents across its £6.7bn portfolio as retailers clamour for space in the best centres. As a result, Hammerson’s net rental income rose by 2.1 per cent to £305m. A £437m rise in the value of its properties was largely responsible for the company more than doubling its pre-tax profits last year, to £703.1m. Its occupancy rate is at 97.5 per cent, which is above its target.

The chief executive, David Atkins, believes consumer confidence is recovering as inflationary pressures recede. He said: “From a London point of view, we have had a positive outlook for a while, but what is really driving our results is the recovery shifting out into the regions. Improved consumer confidence is leading to more spending and that, in turn, is leading to increased retailer demand.”

The number of people visiting Hammerson’s malls actually fell 1.3 per cent last year as the popularity of online shopping increased. But the firm said: “Consumers are spending more time and money during each visit to our centres.”

Hammerson, which sold its offices in the City of London in 2012 to focus on retail, also has a pipeline of developments on which it expects to spend £1.5bn. These are mostly in the capital and include the extension of Brent Cross and the transformation of Croydon’s Whitgift Centre mall.

There is also a controversial £800m plan to regenerate a 10-acre former railway goods yard site at Shoreditch, east London, which has stood derelict since Bishopsgate station burned down in 1964. This would see the building of 1,500 homes in towers of up to 46 storeys, plus offices, shops and a park.