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Hammerson predicts £1m annual rental from Silverburn

Hammerson has said it expects to bring in around £1 million in annual rental income from its extension to Silverburn.

The shopping centre landlord said the 10,900 square metre development, in which it has a 50% stake alongside the Canada Pension Plan Investment Board, should be completed in the first quarter of next year.

The development value was initially put at around £20m and Hammerson yesterday said there was around £8m still to be spent.

It was reaffirmed that 84% of the space had already been let, with Cineworld the main anchor tenant, with a 14-screen theatre taking around a quarter of the total space. There will also be nine new restaurants with the likes of Zizzi, Pizza Express, TGI Friday and Cosmo already signed up.

Hammerson said: "The restaurants are expected to operate from autumn 2014 with the remainder of the scheme open for business in early 2015." At Abbotsinch Retail Park in Paisley, which Hammerson acquired in October 2012, an extension could be completed in the second quarter of this year.

Hammerson is also expecting to secure around £1m of rental income from that development.

So far, 87% of the 5000 square metres is already pre-let as only one of the five new units has still to find a tenant, with Maplin, Wren Kitchens, Dunelm and ScS all lined up to open stores. Hammerson said it still had to invest around £7m to complete the construction phase.

Overall the business saw its net rental income in 2013 increase 9.3% from £258.8m to £282.8m, with the like-for-like rise put at 2.1%.

Total occupancy was at 97.7%, which was up from the 97.1% recorded at the end of September.

It indicated its UK shopping centres, which include the Bullring in Birmingham, Union Square in Aberdeen and Monument Mall in Newcastle, had performed more strongly than those in France.

Retail sales at UK shopping centres fell 0.4% in 2013 compared to 0.4% growth recorded the previous year, while footfall was 1% down. Hammerson said poor weather at the start of 2013 had been a factor in the lower figures but the final three months of the year was "encouraging".

French sites saw a 2.7% dip in sales with footfall down by 4.9%.

The growth in like-for-like net rental income at UK retail parks was just 0.2%, which was attributed to "significant tenant administrations" in the first half of 2013. The likes of Blockbuster, Jessops, Republic and HMV called in administrators in the early months of last year.

Hammerson highlighted Union Square and Brent Cross in London as particularly strong performers within its portfolio across 2013.

Hammerson said its annual dividend was at 19.1 pence, up from 17.7p in 2012. Adjusted pre-tax profits were up 11% at £168.9m.

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