Disposal

RNS Number : 3185R

Hammerson PLC

19 August 2010

 



Disposal of interest in O'Parinor shopping centre, Paris

Hammerson has exchanged conditional contracts to sell 51% of its interest in O'Parinor shopping centre, Aulnay-sous-Bois, near Paris, to The National Pension Service of Korea ("NPS"), advised by Rockspring Property Investment Managers LLP. NPS and Hammerson have agreed that NPS can purchase, and Hammerson can sell, a further 24% interest in Autumn 2011 at a price based on the same valuation of the centre.

 

The centre, held in co-ownership with Carrefour and Redevco, was originally acquired by Hammerson in 2002. The Company completed a 24,000 m² extension and development in 2008, taking the total size of the centre to 90,000 m². The total cost of the centre to Hammerson, including the recent extension, is €274 million. Principal occupiers include Fnac, Go Sport and H&M, with the extension accommodating international brands including Esprit, Saturn and Guess.

Hammerson will receive net proceeds from the sale of its 51% share of €217 million, after costs of €5 million. The net proceeds from the sale of a further 24% interest are expected to be €106 million. Hammerson will retain the asset management role for the new joint venture. At 30 June 2010 the centre was valued at €432 million (31 December: €454 million) and had passing rents of €24.5 million. Net income from the property in 2009 was €21.8 million.

The disposal will allow Hammerson to realise value, and release capital for investment opportunities in the UK and France which offer superior returns. In addition, the disposal will reduce the exposure to Hammerson's single largest asset whilst maintaining critical mass in the sector, as with the part-disposal of Espace Saint Quentin. Following this transaction Hammerson's pro forma gearing will be 56%, providing substantial capacity for future acquisitions.

David Atkins, Chief Executive of Hammerson, said:

"We are very pleased to be partnering with NPS on this transaction and the ongoing management role will allow us to enhance the income from our retained stake. This transaction is consistent with our policy of active portfolio management. Our strategy is to improve the growth prospects of the portfolio by releasing capital from mature assets where we have created value, such as O'Parinor, reinvesting into assets such as Silverburn in Glasgow and future developments such as Les Terrasses du Port in Marseille."

Hee Seok Kim, Head of Global Investment at NPS, added:

"This transaction is in line with our strategy of investing in high quality global real estate. Working alongside Rockspring, we are very pleased to be creating a new joint venture partnership with Hammerson, one of Europe's foremost managers of retail property."

Further information:

David Atkins, Chief Executive	Tel:  [phone]
Morgan Bone, Director of Corporate Communications	Tel:  [phone] [e-mail]

 

Notes to editors

1. Hammerson is a FTSE 100 company with a real estate portfolio in the UK and France of around £5.4 billion. At 30 June 2010 Hammerson had investments in 16 major shopping centres and 16 retail parks providing a total of 1.6 million m² of retail space. The Company owned six London office buildings, which provide around 105,000 m² of prime accommodation. Its high quality portfolio provides a secure and growing income stream that will be enhanced through development. Benefiting from tax-efficient REIT status in the UK and SIIC in France, Hammerson is listed on the London Stock Exchange.

 

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