Dundrum Town Centre co-owner Hammerson narrows losses amid retail recovery

Dundrum Town Centre co-owner Hammerson narrowed its losses to £164 million (€184 million) last year as it reported a continued recovery in adjusted earnings at its value retail operations.

The retail property investment firm, which owns Dundrum Town Centre alongside German insurer Allianz, said its adjusted earnings rose 60 per cent to £105 million in 2022, a year in which its finance costs fell due to deleveraging.

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The company, which also operates in France and Britain, said positive footfall and sales trends at its assets have continued into the first few months of 2023.

Footfall rose 11 percentage points last year to reach 90 per cent of pre-pandemic levels. Sales are ahead of 2019 levels across its portfolio. At Dundrum they are up 3 per cent compared with 2019.

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Hammerson also co-owns the Swords Pavilions shopping centre and Dublin’s Ilac Centre.

In 2022, it completed the “repurposing” of the former House of Fraser store in Dundrum. This space is now partly occupied by Brown Thomas with Penneys also due to take up two floors, while Dunnes Stores has agreed to take up the unit set to be vacated by Penneys.

The return to near full occupancy at Dundrum mirrors trends for Hammerson internationally. It signed a total of 317 leases delivering rent of £45 million in 2022, a year in which it reached 96 per cent occupancy, with this strong rate of activity continuing into 2023.

The company has also submitted a planning application that will see the construction of 900 homes in Dundrum, as well as retail space, food and beverage units and a creche.

A Hammerson-Allianz joint venture last October commenced construction on a 122-unit residential development at The Ironworks in the Dublin suburb. It will also include a co-working space.

“This is a very different business from the one I jumped into at the end of 2020,” said Hammerson chief executive Rita-Rose Gagné. “In the last two years we have driven significant change and strengthened our operational grip on the business against a very volatile economic backdrop.”

Ms Gagné said Hammerson’s asset footprint in “some of the best cities” meant it was well positioned to benefit from the positive trends it sees emerging in a constantly evolving consumer landscape.

“There is substantial deeper repurposing and development value to unlock in our portfolio.”

Rent collections have normalised since the disruptive Covid years, said chief financial officer Himanshu Raja.

Hammerson is targeting about £300 million in disposals this year.