Dundrum owner Hammerson says UK property market facing uncertainty after Brexit vote
Shopping centre landlord Hammerson said the impact of Britain’s decision to leave the European Union on property valuations was still unknown, but the lettings and investment markets were facing a period of uncertainty.
The company, which partly owns the Brent Cross Shopping Centre in London, said its external valuers had said that the probability of their valuations exactly matching the price achieved if Hammerson sold its assets had reduced after the Brexit vote.
Concerns have risen that prices for commercial properties may fall after the vote, with some investors worried that international retailers and banks may move some operations to other EU locations, hurting demand for property.
Lawyers and brokers have told Reuters that buyers, predominantly private equity players, were managing to secure “Brexit discounts” on property of up to 10pc since the vote, as some sellers agree to let go of assets for less.
Hammerson’s shares have lost about 7pc of their value since June 23, the day when Britain voted to leave the EU.
Hammerson, however, said on Monday that demand to rent had stayed strong for high-quality retail property and that it had signed 20 leases for higher-than-estimated rental values after the referendum.
“We have been reassured by the level of leasing and investment activity post the EU referendum… highlighting continued appetite for high-quality retail property,” Chief Executive David Atkins said in a statement.
The company’s adjusted profit, which best reflects earnings and excludes changes in valuations, rose 6pc to 112.6 million pounds in the six months ended June 30.
Hammerson intended to pursue a secondary listing on the Johannesburg Stock Exchange by early September to ensure that it has access to a “wider pool” of international capital, the company said.
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