Hammerson Acquires Additional Bullring Stake

RNS Number : 9800D

Hammerson PLC

03 May 2013

 



For immediate release 3 May 2013

HAMMERSON ACQUIRES ADDITIONAL STAKE IN BULLRING, BIRMINGHAM

Hammerson has acquired an additional 16.7% stake in Bullring, taking its ownership to 50%. The acquisition underlines Hammerson's commitment to prime retail destinations and generating income growth through investment in winning sectors of the retail property market.

In a 50:50 Joint Venture with Canada Pension Plan Investment Board ("CPPIB"), Hammerson has acquired Future Fund's 33.3% stake for £307 million. Hammerson's consideration of £153.5 million will be satisfied in cash from existing resources. Passing rents for the whole scheme are £53 million per annum and after taking into account purchase costs the net initial yield on the purchase is 5.7%.

Hammerson, as part of a joint venture with Henderson and Land Securities, originally developed Bullring in 2003, and has managed the centre since opening. Hammerson will continue to have responsibility for asset management and development of the centre. 

Bullring is one of the UK's top ten retail destinations, and continues to attract leading domestic brands, expanding international retailers, and high-quality catering to Birmingham. Anchored by Selfridges and Debenhams, it is over 99% let and attracts some 40 million shoppers per annum. Since opening Bullring has demonstrated compound annual growth in ERV of 3.5% and passing rents of 5.5%.

Bullring celebrates ten years of trading this year, during which it has consistently demonstrated impressive footfall and tenants' sales growth. Following the successful leisure extension of Spiceal Street in 2011, there are a number of additional asset management and development opportunities to drive future growth at the centre by further improving the catering, leisure and entertainment offer.

Hammerson's existing 33.3% stake was valued at £308 million at December 2012, and the ownership of Bullring is now held by Hammerson (50%), CPPIB (16.7%) and Henderson Shopping Centre Fund (33.3%). CPPIB has a small indirect interest in Bullring through its investment in the Henderson Shopping Centre Fund. The new joint venture is the third partnership between Hammerson and CPPIB.

Commenting on the acquisition, David Atkins, Hammerson Chief Executive said:

"This is an excellent opportunity to enhance our position in one of the UK's strongest shopping destinations at an attractive entry price. Bullring is an iconic centre which has performed extremely well since opening in 2003, and I am confident in the continued future success of Bullring as consumer demand for venues which offer exceptional experiences continues to rise." 

Graeme Eadie, Senior Vice President and Head of Real Estate Investments, CPPIB, said:

"This transaction provides CPPIB with further scale and opportunity in Bullring and is in line with our UK retail strategy of investing in high quality assets in major locations with strong growth potential. We are pleased to expand our relationship with Hammerson, one of Europe's leading retail property companies, whom we know well having worked together successfully on other investments."

Contacts

Hammerson

David Atkins, Chief Executive

Morgan Bone, Director of Corporate Communications

[phone] 

[e-mail]

www.hammerson.com

CPPIB

Linda Sims, Director, Media Relations

[phone]

[e-mail]

Notes

Bullring comprises 127,000m², with 167 tenants including high-quality fashion and catering brands.  Average passing rents are £510/m². Bullring generates an additional £3 million per annum in commercialisation revenues and has over 145,000 facebook fans.

www.bullring.co.uk

For high-resolution media images please contact Hammerson or CPPIB 

 

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