Hammerson sells London offices

Property firm Hammerson is set to off-load most of its London office space as it pushes forward with plans to focus solely on retail space.

The company has exchanged contracts on the majority of its office portfolio with Brookfield Office Properties for £518m.

The six assets on the block represent 75% of Hammerson's London offices and the sale price was 5.0% above proforma book value and represented a 5.2% initial yield, it said.

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The deal leaves the firm with virtually no office space on its books, with retail set to make up 97% of its portfolio.

Hammerson said the proceeds of the sale would be invested in retail developments and acquisitions in its three chosen areas: prime regional shopping centres, convenient retail parks, and premium designer outlets.

"In our strategic review announced earlier this year we identified the opportunity to enhance returns by focusing our energy and capital on the successful sectors of retail which cater to consumers' increasing desire for experience, convenience and value," said Chief Executive David Atkins.

"I'm delighted that we have been able to achieve our goal of becoming a pure retail business earlier than anticipated by arranging a single transaction for the majority of our London offices which secures excellent value for shareholders."