Developer will switch focus from commercial to retail projects
Hammerson is to sell its entire £600m London office portfolio in favour of focusing on its retail businesses in the UK and France.
The developer revealed it will sell its office investments over the next few years and invest returns in shopping centres.
The developer’s decision comes a month after it was forced to put on hold its £290m commercial-led Principal Place tower in London (pictured), after the scheme’s anchor tenant – law firm CMS Cameron McKenna – pulled out of the project.
The Foster + Partners-designed scheme will be Hammerson’s last commercial project for the foreseeable future. The developer has now scheduled the project to start at the end of 2012.
David Atkins, chief executive of Hammerson, said: “Following the review of our strategy we will focus on being the best owner-manager and developer of retail property within Europe.
“Hammerson has created a retail business delivering outperformance from prime assets in winning locations.
“We now intend to sell our standing office investments over the medium term to maximise returns, redeploying capital into the retail sector to exploit our expertise and build on our existing scale.
“This will create efficiencies that lead to further cost savings and income growth from our portfolio.”
He added that the current economic uncertainty had slowed demand for office space, and rents had remained flat over the year.