Hammerson to focus on city quarters in new retail strategy
Hammerson is to exit retail parks in the medium term in favour of fifteen prime city locations. The disposal target is £1.1 billion by 2019.
Part of this change in direction is the firm's 'New City Quarter' concept and a focus on 'operational excellence and cost savings'. Hammerson points in its step change to devoting more resources to meet increased consumer demand for experience enhancing events and a sophisticated digital offer.
David Atkins, Chief Executive of Hammerson says 'We will reduce the amount of floor space to department stores and high street fashion as we actively focus on the latest consumer trends and take bolder steps to provide the best retail mix'.
Data, recently collected, has highlighted new consumer trends and this is behind the change in direction. Hammerson has the majority of its retail outlets in the top European cities. Urban populations its states are growing and It forecasts that greater urbanisation has the potential to transform the built environment surrounding the company's assets, for example creating more mixed-use lifestyle venues. The company is looking to extract value from its valuable land bank of at least 65 acres of prime city locations, mostly adjoining it existing retail hubs.
The store, the firm says, remains fundamental to consumers discovering and buying products, building a relationship with brands, fulfilling the growing demand for social and stimulating experiences and accessing customer service. In the UK, it insists, the fastest growing shopping mission is for 'the big day out' accounting for a quarter of visits, therefore the firm will focus on top-tier city shopping centres underpinned by strong demographics and consumer catchments.
UK department store space will shrink by a quarter, it announces, and it will defer starting on site with the Hammerson development at Brent Cross - the latter nevertheless, remaining an important strategic project in the long term, supporting its future success as one of London's leading destinations.