# Hammerson plc completes £236m Highcross sale

- Link: https://www.directorstalkinterviews.com/hammerson-plc-completes-236m-highcross-sale/412762235
- Published: 2018-11-29T07:56:04+00:00
- Author: Charlotte Edwards

**Hammerson plc** (LON:HMSO) today announced that is has completed the sale of the
50% stake in Highcross shopping centre in Leicester to an Asian investor introduced
by M&G Real Estate for £236m.

As previously reported at the time of exchange (5 October 2018), the sale price 
represents a 5% discount to December 2017 book value.

The completion of the transaction follows successful standard EU competition clearance
and the arrangement of a £165.2m loan by the joint venture (Hammerson’s share £82.6m).

The five-year loan is secured on Highcross on a non-recourse basis and the lenders
are Helaba (Underwriter and Arranger) and National Westminster Bank Plc. The facility
is repayable in full at maturity in February 2024 and the interest cost has been
fixed at less than 3%.

Hammerson will use the net proceeds from the sale to reduce drawings under its revolving
credit facilities and reduce net debt. The proceeds from Hammerson’s 50% share of
the loan (£82.6 million) will also be used to reduce drawings under revolving credit
facilities with no impact to Group net debt.

**Highcross: continuing to drive and evolve retailer line up**

Highcross has seen a significant boost in its retail line up in recent years, with
space proactively taken back from House of Fraser in 2016 now accommodating a flagship
Zara store alongside a full-line JD Sports, as well as providing additional restaurant
and leisure space.

This month has seen the first restaurant brand to sign as part of this transformation.
Independent Indian brand Tamatanga will open its third restaurant in the region 
and Treetop Adventure Golf is set to open in the first half of 2019. In St Peter’s
Square, Highcross’ dedicated dining quarter, the Seattle-based Italian street pizza
chain MOD Pizza, will also open in the coming weeks and replaces Chimichanga, which
was subject to a CVA.

Hammerson continues to curate a refreshed retail offer for shoppers with a recent
series of high quality signings from leading brands. Mercedes-Benz has this week
taken the former Zara unit to deliver an experiential pop-up store, which will be
a regional first.

Luxury lifestyle brand The White Company and modern vintage expert Cath Kidston 
have also recently opened pop-up units, taking advantage of the centre’s strong 
customer catchment. Finally, in a Hammerson first, Typo, the Australian stationery
and gift retailer, has just opened at Highcross as part of its UK expansion.

> **David Atkins, Chief Executive of Hammerson, commented:** “We are pleased to 
> have attracted a respected investor who shares our future vision for Highcross.
> The recent leasing momentum demonstrates that brands continue to open new stores,
> however the location has to be right, with only the best destinations making the
> cut.
> We don’t see this changing anytime soon, and a vibrant brand line-up with the 
> ability to ensure constant variety is fundamental to Highcross’ success as a flagship
> venue.”
> “Given the high quality tenant base we were able to obtain attractive pricing 
> on the Highcross loan and lock in low interest rates. Whilst Hammerson typically
> funds from the unsecured debt capital markets, this financing continues the use
> of secured debt on selected joint ventures.”
> **John Duxbury, Head of Retail & Leisure, M&G Real Estate added:** “We are very
> pleased to have worked with Hammerson on this. Whilst the retail sector might 
> have its challenges, prime assets in the right locations will be resilient to 
> competition from e-commerce and will provide our investors with long term prospects
> for income and capital appreciation. With its strong line up of retail and leisure
> brands, we believe Highcross has a very exciting future.”

Share on: