Hammerson and Westfield sign JV for £1b Croydon regeneration

UK REIT Hammerson and Australian property giant Westfield have entered into a joint venture to redevelop the retail centre of Croydon in the UK.

Under the joint venture, Westfield has acquired a 50% interest in the £115 mln (€138 mln) Centrale shopping centre from Hammerson. The joint venture will also purchase a 25% interest in the Whitgift Centre, following completion of Hammerson's conditional acquisition agreement with Royal London.

The 25% Royal London interest in the Whitgift centre is worth £65 mln, and the stake generates net rents of £2 mln.

Westfield and Hammerson intend to redevelop and combine the Whitgift Centre and Centrale shopping centres to deliver a transformational change to Croydon. The £1 bn mixed-use scheme of around 200,000 m2 will include retail, leisure and residential with the potential to add hotels and offices. It will create over 5,000 new jobs.

Hammerson and Westfield said they will meet with all stakeholders over the coming weeks to discuss their plans for Croydon, following which a revised masterplan will be created combining the best elements of both schemes. It is anticipated that planning consent could be secured in 2013, with construction expected to start on site in 2015.

'Croydon has huge potential to return to its former glory as one of London's most vibrant town centres and a major driver of its economy. The redevelopment of the Whitgift Centre at its heart is crucial to this vision,' said London mayor Boris Johnson.

Hammerson owns and manages the 700,000 sq ft Centrale shopping centre which attracts over 12 million shopper visits every year. The Whitgift Centre currently comprises 600,000 sq ft retail space and 400,000 sq ft offices.