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Hammerson has purchased a 50 per cent stake in Manchester's Arndale shopping centre in a deal worth £218 million, as the firm pivots towards external acquisitions in its bid to scale the business. The centre welcomes more than 45 million visitors, and the acquisition increases Hammerson's scale and geographic footprint.
The scale of the footfall figure underlines why the asset was seen as a strategically significant addition to Hammerson's portfolio rather than a routine transaction.
Deal details and terms
The 50 per cent stake was acquired from Palma Arndale BidCo, marking Hammerson's first major external acquisition in over a decade.
The deal is expected to be earnings accretive from day one and represents a topped-up net initial yield of 7.8 per cent, giving an early indication of the return Hammerson expects the asset to generate relative to its purchase price.
The earnings-accretive framing in particular signals that the acquisition is expected to add to Hammerson's financial performance immediately, rather than requiring a longer period before it contributes positively.
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Part of a broader pivot to external acquisitions
The acquisition was announced alongside the listed property giant's half-year results, in which it reported strong earnings growth. Coming at the same time as those results, the deal signals that Hammerson's move into external acquisitions is being positioned as part of a wider growth strategy rather than a one-off transaction.
Pairing the announcement with half-year results also allowed Hammerson to present the deal within the broader context of its improving financial performance, rather than as an isolated capital allocation decision.
What CEO Rob Wilkinson says
Rob Wilkinson, who took over as chief executive of Hammerson at the start of the year, said the firm's strategy was "naturally broadening to external acquisitions" and that the team was busy seeking further deals.
His comments suggest the Manchester Arndale stake may be followed by additional acquisitions as Hammerson continues to expand beyond its existing portfolio.
Coming this early in his tenure as CEO, the deal also signals a clear early marker of the direction Wilkinson intends to take the company's growth strategy.
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