The owner of Aberdeen’s Union Square shopping mall saw its profits last year more than double to £703million.
The FTSE-100 giant posted a 2.1% rise in net rental income during the period as it said it experienced strong demand from retailers who wanted prime space in its properties.
Hammerson added that its property portfolio gained from a revaluation gain of £547million, equivalent to a total return of 13.6%.
The business has also benefited from the 2013 strategy of chief executive David Atkins to withdraw from its London office buildings and focus on retail outlets in order to take advantage of the UK’s consumer-led recovery.
However, these results were in line with forecasts and did not prevent its shares slipping 6p to 685p.
Among its portfolio of 22 shopping centres in the UK and France, including the Bullring in Birmingham and Brent Cross in London, Union Square was a star performer for the group.
Last week the group confirmed sales at the Granite city mall rose by more than 5% last year, bucking a UK trend. In its full year results statement yesterday, Hammerson added that a 2.2% growth in net income in its UK business, driven by rent reviews and increased commercial income was notable in Aberdeen. Union Square was also cited as a driver “non-rental income” – such as pop up stands and marketing spend – which increased by 5.9% across the group.
Despite a 1.3 % decline in footfall hittingthe firm’s UK shopping outlets last year, consumers spent more time and money each time they visited a Hammerson mall. Jewellery, sports and outdoors and health and beauty items were top sellers, the firm said.
Mr Atkins said: “We have delivered strong results on the back of a significant uplift in asset valuation and continuing income growth.
“The recovery in UK consumer sentiment has continued to strengthen, driving increased demand from retailers for prime space, which is now translating into estimated rental value growth across the whole portfolio.”
The company said it has raised £1billion of new cash to fund expansion, adding it had invested £100million on its premium outlets.
Its biggest UK tenants last year were B&Q, Next and Dixons Carphone.
Mr Atkins said: “In France, we have seen an encouraging improvement in performance, reflecting the success of our refurbishment programme.”
Shares have risen 23% over the last 12 months.
Investec analyst Alison Watson said: “The improving UK consumer environment also fed through to stronger operational metrics.”