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Hammerson upbeat despite drop in retail visits and sales

Sales and visits to UK shopping centres owned by commercial property developer Hammerson fell in the first three months of 2012

Figures for the developer, released to the stock exchange today, show footfall in its UK shopping malls fell 1.9 per cent in the first quarter of 2012 compared with the same period a year earlier.

Sales by its UK tenants fell 1.7 per cent which was a larger fall than the 0.4 per cent drop in the British Retail Consortium’s non-food index.

However Hammerson added that its sales in its UK shops improved in each month of the first quarter of this year and were positive in March.

It also said occupancy levels across its portfolio of shops and offices in the first quarter of 2012 were 0.1 per cent ahead of its 97 per cent target. Occupancy rates dropped slightly from 97.9 per cent in December 2011 but were ahead of the March 2011 level of 96.7 per cent.

The firm announced today that it will buy back up to €200 million of its €700 million unsecured bonds due in 2015.

The firm said its borrowings at 31 March were £2.1bn and cash was £76m to give net debt of £2bn, the same level as in December 2011.

Hammerson has started work on the redevelopment of the Monument Mall, Newcastle with the first reconfigured unit opening later this year. Construction will start later this month on the redevelopment of Manor Walks Shopping Centre. The extended units in Queensgate shopping centre in Peterborough will be handed over to tenants in July. Earlier this month it was selected as preferred partner for redevelopment of the Whitgift centre, Croydon which is adjacent to Hammerson’s Centrale shopping centre.

David Atkins, chief executive of Hammerson, said: “Hammerson has again performed well despite the challenging economic backdrop and continued pressure on household incomes. We are attracting leading retailers to our shopping centres and retail parks.”

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