|Bid||209.60 x 0|
|Ask||209.80 x 0|
|Day's Range||206.90 - 224.90|
|52 Week Range||202.90 - 396.40|
|Beta (5Y Monthly)||0.94|
|PE Ratio (TTM)||N/A|
|Earnings Date||Feb 25, 2020|
|Forward Dividend & Yield||0.26 (11.36%)|
|Ex-Dividend Date||Mar 19, 2020|
|1y Target Est||479.33|
(Bloomberg Opinion) -- The stock market’s longstanding skepticism about official real-estate valuations just got fresh support from a jumbo writedown at one of Britain’s biggest mall and office operators. Hammerson Plc’s results are yet again catching up with its depressed share price. The company resisted a takeover bid in 2018 by pointing out that its reported net asset value was higher than the offer. That defense tactic looks increasingly weak for property firms.Hammerson ended 2019 with a 19% annual drop in its NAV, to 4.6 billion pounds ($6 billion) — or 601 pence per share — by the standard European definition. Even that reduced level is much higher than the current share price of 224.6 pence.NAV is struck based partly on recent property sales. It’s not completely arbitrary, but it’s an imperfect measure of what an entire property portfolio might fetch. The difficulty is that it may provide too rosy a view. Hammerson resisted a tentative takeover approach from French rival Klepierre SA in early 2018, worth 615 pence a share and later sweetened to 635 pence a share. Its initial rejection went big on the fact that the proposal was a sharp discount to its then NAV. Klepierre gave up. How investors must weep with hindsight.True, it’s not certain that a binding offer could have been agreed. Klepierre looked somewhat hesitant. Even so, a less theoretical response from Hammerson, giving more weight to the takeover’s premium to the value of its shares rather than the offer’s discount to book value, may have helped. The bidder’s final pitch was 45% above the target’s undisturbed share price. Half of the offer — some 2.5 billion pounds — would have been in cash. Hammerson’s current market capitalization is 1.7 billion pounds.Investors should applaud management that demands bidders pay full value. No one should be better placed to put a number on the instrinsic worth of a business than its own board. That’s why shareholders tend to take their cue from the insiders when it comes to accepting or snubbing an offer. But clearly real estate is one sector where the stock market’s assessment of worth is generally highly relevant.In fairness to Hammerson, stock markets can sometimes overdo the gloom. The share-price discount to reported NAV has been rising at the company, even though it’s been doing a good job of cutting net debt though disposals. If Hammerson gets another bid, it may struggle to build a robust defense based its NAV again. But that would be no grounds for caving in to an opportunistic offer just above the current battered share price.To contact the author of this story: Chris Hughes at firstname.lastname@example.orgTo contact the editor responsible for this story: James Boxell at email@example.comThis column does not necessarily reflect the opinion of Bloomberg LP and its owners.Chris Hughes is a Bloomberg Opinion columnist covering deals. He previously worked for Reuters Breakingviews, as well as the Financial Times and the Independent newspaper.For more articles like this, please visit us at bloomberg.com/opinionSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
Net asset value was 19 per cent lower at the end of December than a year earlier at £6.01 per share, while net rental income was 11 per cent lower. The fall in rental income is partly because Hammerson has been selling properties that have fallen out of favour with shoppers. While like-for-like net rental income (NRI) at Hammerson’s UK flagships was down 6.7 per cent, premium outlets helped shore up the group so that overall like-for-like NRI was up 0.5 per cent. But the deteriorating value of its flagships in the UK, France and Ireland was what dragged down the portfolio value and drove negative capital return of minus 9.8 per cent. Still, rival Intu probably has it worse.
One of the UK’s biggest shopping centre owners will cut its 2020 dividend by almost half as it refocuses its business away from retail parks in a reflection of the dire state of the sector in the UK. Hammerson, which owns the Bullring in Birmingham and Brent Cross in London, suffered a sharp fall in net asset value per share — from 738p to 601p — last year. It has been shifting its portfolio away from retail parks, which have suffered as fewer shoppers means tenants have struggled to pay rents.
Too late for the January sales, but property group Hammerson finally found a buyer for its remaining British retail parks on Friday. Largest perhaps, but the £455m price tag is still a hefty 22 per cent below last June’s book value. The proceeds go towards paying down Hammerson’s net debt, which stood at £3bn last June.
Cohen & Steers, Inc. (NYSE: CNS) announced today pending changes to its International Realty Majors Portfolio Index (IRP) and Global Realty Majors Portfolio Index (GRM), effective as of the close of business on February 21, 2020.
Every year millions of Chinese consumers fly into London and board a train to the small Oxfordshire town of Bicester.
Shopping centre operator Hammerson Plc on Wednesday appointed AIG executive James Lenton as its new finance chief, months after saying Timon Drakesmith would step down from the role this year. Hammerson and its peers are struggling with a tough retail environment in Britain, which has seen several high-profile chains close in the last year as consumer habits change and Brexit worries quell spending by shoppers. Its latest earnings report showed a more than 12% drop in net rental income, excluding premium outlets for the first-half.
Moody's Investors Service (Moody's) has changed to negative from stable the outlook of leading European retail real-estate owner, manager and developer Hammerson Plc (Hammerson). At the same time, Moody's has affirmed Hammerson's Baa1 long-term issuer rating and its Baa1 senior unsecured ratings.
Moody's Investors Service ("Moody's") has completed a periodic review of the ratings of Hammerson Plc and other ratings that are associated with the same analytical unit. The review was conducted through a portfolio review in which Moody's reassessed the appropriateness of the ratings in the context of the relevant principal methodology(ies), recent developments, and a comparison of the financial and operating profile to similarly rated peers. This publication does not announce a credit rating action and is not an indication of whether or not a credit rating action is likely in the near future.
(Bloomberg) -- Want the lowdown on European markets? In your inbox before the open, every day. Sign up here.Faced with the choice of accepting rent cuts or hunting for new retailers to fill hundreds of stores, U.K. mall owners are swallowing their medicine.Some of Britain’s biggest commercial landlords including Hammerson Plc and British Land Co., voted in favor of a rescue plan for billionaire Philip Green’s Arcadia Group that meant having to accept dozens of store closures and rent cuts of at least 25% at almost 200 sites.But their approval for the so-called Company Voluntary Arrangement was grudging and highlights how much pressure they are under from the pain inflicted on retailers by consumers choosing to shop online rather than in department stores.Land Securities Group Plc, Standard Life Aberdeen Plc and the Crown Estate had intended to vote against Arcadia’s proposals and switched at the 11th hour, according to people familiar with their plans who asked not to be named discussing information that isn’t public. One landlord, Intu Properties Plc, voted against, calling the deal unfair to tenants that pay full rent.“It really is like being stuck between a rock and a hard place,” said Daniel Swimer, property litigation partner at law firm Joelson. “Landlords could have rent reductions forced upon them or, if the CVA doesn’t get passed, they’re left with a large retailer failing in the current retail climate.”Deal ApprovedThe fact the deal was approved is likely to put further pressure on mall rents and values, and raises the possibility that commercial property owners could be tipped into a crisis similar to that faced by the retailers who make up some of their biggest tenants.The cost of insuring Land Securities’ debt against default saw the biggest daily rise since December on the day after the Arcadia vote, according to ICE Data Services. Moody’s Investors Service warned of possible damage to the creditworthiness of retail property owners that already face “weak operating performance, with declining footfall and retail sales, and downward pressure on rents.”The landlords came under pressure from Arcadia to back the deal or put about 18,000 jobs at risk if the company was forced into administration, people with knowledge of the negotiations said. Several were told they would be shirking their social responsibilities and be blamed for job losses, an accusation they resented, some of the people said, asking not to be identified as the talks were private.Arcadia representatives declined to comment.Ultimately the decision to back the CVA came down to the best commercial interests of the landlords, given that they could be left with empty sites if Arcadia fell into administration, two of the people said.Spokesmen for Land Securities, the Crown Estate and Standard Life Aberdeen confirmed they had backed the plans but declined to comment on the detail of the negotiations. Representatives of Hammerson and British Land declined to comment.Smaller CutsWhile many companies have preceded Arcadia’s CVA, few have been so large and many secured less generous rent cuts. The risk is that following Arcadia, other retailers now demand the same, even those that have previously undertaken rent cuts.“There’s nothing to stop companies coming back for a second bite,” Andrew Hughes, head of European general retail at UBS said at a media briefing last month.Intu has previously highlighted the likely impact of Arcadia’s CVA, saying last month that store closures are worse than expected and it sees net rents falling 4% to 6% this year. The company, which owns eight of the top 20 malls in the U.K., is under pressure itself to sell assets to cut debt and CVAs are hampering those efforts.Falling ValueIntu said in February that a further 10% fall in the value of its properties would cost 1 million pounds in extra expenditures in order to avoid a breach of loan covenants. U.K. Retail property values fell 10.25 percent in the year through May, according to data compiled by broker CBRE Group Inc.Some landlords are pushing back on department store chain Debenhams’ outlet closures which won creditor approval in May. Sports Direct International Plc has grouped together with landlords to challenge the CVA and property investor M&G Investments has launched another challenge, a spokeswoman for the asset manager confirmed.But it will be hard for landlords to stop the trend. Consumers’ shift to online shopping shows little signs of abating and insolvencies have jumped by more than a fifth since 2016, with more than 1,200 retailers collapsing last year.“What is 100% certain is that retailers can’t carry on paying the rents they have historically,” said Richard Hyman, an independent retail consultant. “There’s less money in the pot to fund it and the pain has to be shared by the landlord as well as by the retailer.”\--With assistance from Antonio Vanuzzo.To contact the reporters on this story: Katie Linsell in London at firstname.lastname@example.org;Jack Sidders in London at email@example.comTo contact the editors responsible for this story: Vivianne Rodrigues at firstname.lastname@example.org, Chris Vellacott, Shelley RobinsonFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.