Hammerson has kicked off the sale process for its out-of-town retail portfolio, appointing an investment bank to oversee it.
The landlord has appointed Morgan Stanley, one of its corporate brokers, to sell around seven retail parks for under £400m.
Morgan Stanley began to approach investors in the weeks ahead of the general election. Market sources have estimated that the deal’s pricing would reflect a blended yield of roughly 8%.
Depending on how the process goes, the landlord would likely also consider the sale of individual assets in the portfolio, if approached with offers.
Hammerson’s out-of-town retail portfolio consists of:
- Abbey Retail Park, Belfast
- Brent South Shopping Park, London
- Central Retail Park, Falkirk
- Cleveland Retail Park, Middlesbrough
- Cyfarthfa Retail Park, Merthyr Tydfil
- Elliott’s Field Shopping Park, Rugby
- Telford Forge Shopping Park
- Parc Tawe Retail Park, Swansea
- Ravenhead Retail Park, St Helens
- The Orchard Centre, Didcot
The REIT first stated its aim to exit retail parks in July last year, as part of a strategy to use disposal proceeds to pay down its debt.
Following a comprehensive review of the business, the shopping centre owner said it planned to focus solely on two retail segments: its flagship retail destinations, and premium outlets.
Hammerson recently concluded the sale of Abbotsinch Retail Park in Paisley, to AshbyCapital and Quadrant. Its £67m sale price represented a net initial yield of 7.8%, and was 3% below June book value.
It also offloaded St Oswald’s Retail Park in Gloucester to a local authority in November, to the tune of £54m. This reflected a net initial yield of 8.5%, some 8% below June book value.
Hammerson has logged £577m of disposals in 2019, exceeding its minimum disposal target of £500m for the financial year. This also included the sale of a major stake in its Italie Deux flagship in Paris for £423m, announced in July.
The landlord has sold seven retail parks since February 2018, with the sales totalling around £400m.
Morgan Stanley declined to comment.
To send feedback, e-mail pui-guan.man@egi.co.uk or tweet @PuiGuanM or @estatesgazette
