FTSE 100 listed office space and retail developers Hammerson say they will not be starting any major new schemes until 2010.
Hammerson have announced that while they will still take development projects through to the planning stage, they will be limiting capital expenditure from now until 2010.
This move from the retail and office space giants is bad news for development projects such as the Eastgate Quarter retail project in Leeds. The £800m scheme is a joint development with Town Centre Securites, and will not now commence until late 2009.
The current condition of the global financial markets is at the root of this decision; the office and retail developers’ share price is closer to it’s year-low of 577p today, than it’s year-high of almost £1.20. John Nelson, chairman at Hammerson said: “The unprecedented conditions in financial markets worldwide have had a major impact on real estate markets leading to caution on the part of occupiers and a sharp decline in investment activity. hese challenging conditions are likely to persist for some time. Nevertheless, I believe that Hammerson’s strengths and its experienced management team mean that the group is in a good position to weather the current environment and benefit when conditions in real estate markets improve.”
Occupancy in the company’s portfolio of retail and office spaces has fallen by around 2% over the last quarter but the company believe that the completion of four new projects around the country is responsible for this slip.
These new developments include the 330,000 square feet office space at 125 Old Broad Street in the City of London and 3 retail schemes; Highcross in Leicester, Bristol’s Cabot Circus and O’Parinor in Paris.
Tags: Cabot Circus, Hammerson, Highcross