Hammerson’s £400m retail parks sale collapses as private equity firm backs out amid coronavirus
Retail landlord Hammerson announced this morning that private equity firm Orion has pulled out of a deal to buy seven shopping parks for £400m.
Hammerson said it had access to a £21m deposit that had been held in escrow by its solicitors after Orion European Real Estate Fund V held firm in its decision not to proceed with the sale.
Orion said last month that it did not intend to complete the deal, despite exchanging unconditional contracts in February, amid the coronavirus pandemic.
The property company said it served Orion with notice to complete by today but was informed last night that the deal would not go ahead.
The transaction would have been the biggest sale of UK retail parks in a decade
The cancellation strikes a blow to Hammerson’s long term plan to exit the struggling retail park sector.
Since 2018 Hammerson, which owns Birmingham’s Bullring, has been in the process of exiting the retail parks sector to focus on a portfolio of flagship assets.
The company has sold 14 retail parks in that period, generating sales proceeds of £764m to reduce the Group’s debt and strengthen the balance sheet.
Retail parks in Falkirk, Middlesbrough, Rugby and St Helens were among the assets Hammerson was aiming to sell to Orion.