Hammerson reports earnings hit after selling off stake in Bicester Village owner

The owner of major shopping centers such as Birmingham's Bull Ring and London's Brent Cross has experienced a significant impact on its earnings after divesting its stake in the owner of Bicester Village, a luxury outlet mall.

Hammerson's underlying earnings fell by 15% to £99m for 2024 following the sale of its retail assets, including the stake in Value Retail, to a private equity firm backed by French luxury goods giant LVMH (Louis Vuitton Moet Hennessy). The sale resulted in a £497m impairment in the first half of 2024, despite generating £595m in cash. This led to a bottom-line loss of £526m, compared to losses of £51m the previous year.

However, Hammerson hailed the past year as "transformative" as the sale has allowed the company to focus on its urban retail real estate and reduce its debts. Rental income decreased by 9% to £189m due to asset sales, but occupancy levels across its centers rebounded to over 95%.

Gross rents also rose by 1.6% on a like-for-like basis, and the company reported an increase of 600,000 shoppers visiting its centers, totaling 170 million for the year. Chief executive Rita-Rose Gagne stated, "Following a transformative and successful year for Hammerson, we enter 2025 as a repositioned business.

"In landing the pivotal sale of Value Retail and completing our non-core disposals, we have generated £1.5bn of cash proceeds over the last four years, materially strengthening our capital structure, and enabling investment for growth in our high-quality portfolio."

She further stated that there was "more to come", with the group "poised to deliver significant revenue and underlying earnings growth, with the full impact of our ongoing investments and acquisitions yet to be realised".