David Atkins: Why shopping centres, not City skyscrapers, are the place to be for the developers at Hammerson

Its chief executive is overseeing a decision by the property company to sell out of offices and concentrate solely on the retail sector with plans to develop malls across the country. Laura Chesters finds out why

David Atkins is walking around Brent Cross shopping centre in north London on a rainy afternoon. But he hasn't told his wife. "I try not to tell her when I am visiting our centres. When I do, invariably I get a list of things to pick up. It can get embarrassing when I am with the board."

Mr Atkins may be reluctant to share his retail schedule with his loved one but he has certainly made a statement about shopping to the City.

In February his property company, Hammerson, announced plans to sell out of offices and stick solely to shops.

The announcement, which will see Mr Atkins sell more than £600m of offices in the City over the next 18 months, shouldn't have come as a surprise to those that know him. Hammerson's chief executive since 2009, he has been in the retail property sector all his life starting as a retail property agent in 1988 at DTZ and joining Hammerson 10 years later. So he is at home in a mall talking about leasing strategies as he is in the boardroom on Hammerson's Grosvenor Street offices in Mayfair.

The UK's third-largest listed property company is already 90 per cent in retail but the decision to sell out of offices completely puts down a challenge for the other big listed property companies that haven't specialised – namely Land Securities and British Land.

"If you look at the listed property sector it is largely made up of specialists such as the smaller players LXB, Metric, Great Portland Estates and then on the larger side Capital Shopping Centres and Segro. British Land and Land Securities are the outliers. But I suspect there will always be those that remain diversified," he said.

"This is about our expertise on retail and leveraging this rather than a call on London offices. The market timing for offices is very hard to predict. It wholly relies on the financial markets. With retail you can influence the asset through asset management and we have the best retail in the UK and France. But in offices, no matter how good the office is if the market demand is not there it will become difficult to let."

But why wait until now? Hammerson has had strong retail credentials since the 1960s under then chief executive Sydney Mason who moved the company into shops and offices from its residential bias when he took over the reins from founder Lewis Hammerson after his death in 1958.

Mr Atkins explained: "Last summer government debt issues came to the fore. Equity markets fell and the listed property companies were hit. We had rioting across the streets and consumer confidence was dented.

"It was clear that speed of recovery would be slower than anticipated earlier that year. We started to look at the business. The City was good but volatile so we felt the benefits in scaling up retail would be better than staying in the City offices market."

Hammerson's share price has been trading at a discount to its net asset value (NAV) the industry measure of a property company's performance. Mr Atkins says he thinks by specialising and "giving greater clarity we will narrow this discount to NAV" and he says the shareholders response has been one of "unanimous support".

Despite the City office market being unpredictable, the retail sector can hardly be described as in rude health.

But Mr Atkins is defiant: "It is about dominance or convenience – these are the retail locations that are doing well."

His biggest bone of contention is in Croydon, scene of showdown between Australian shopping centre expert Westfield and Hammerson.

Both want to redevelop a giant shopping centre in the middle of town – the Whitgift centre. Hammerson has bought a 25 per cent stake in the Whitgift and owns a nearby shopping centre while Westfield has agreed a deal with the freeholder of the Whitgift.

Whatever happens in Croydon, Hammerson has other things to get on with.

It has a large pipeline of potential developments that were put on hold when the credit crunch hit in 2007 and schemes became too expensive to build. Hammerson has been working on revised plans for new shopping areas in Leeds, Sheffield and north London around Brent Cross in Cricklewood. The big schemes will not happen before 2014, but the company is still spending money on revising plans.

It is also working on smaller developments of existing schemes including in Newcastle and Cramlington.

As Mr Atkins weaves his way out of Brent Cross following our meeting, dodging buggies, hoards of teenagers, and women bustling past laden with bags, he spots celebrity scientist Robert Winston among the crowds heading for John Lewis.

"See, even scientists like to shop here – everybody loves shopping," he said.

Shopping centres aren't a science, but Mr Atkins and Hammerson's shareholders hope his experiment pays off.

Hammerson malls

Brent Cross, London

Bullring, Birmingham

The Oracle, Reading

Silverburn, Glasgow

Union Square, Aberdeen

Cabot Circus, Bristol

Highcross, Leicester

Centrale, Croydon

Queensgate, Peterborough

WestQuay, Southampton

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