Hammerson sells Sheffield retail park at 6.4% yield

UK REIT Hammerson has sold Drakehouse Retail Park in the English city of Sheffield to London-based Shariah-compliant investment advisory 90North Real Estate Partners.

The investment volume of £61.7 mln (€86 mln) reflects a net initial yield of 6.4%.

At 21,000 m2, Drakehouse is Sheffield’s largest retail park, located seven miles southeast of Sheffield city centre. The scheme is fully let and current tenants include Homebase, Currys, Wickes and B&M. In addition there is an 830 space car park.

David Atkins, CEO of Hammerson, said: 'The disposal of Drakehouse enables us to re-allocate capital across our retail portfolio, including to our significant London retail development projects at Croydon and Brent Cross.

'By recycling the proceeds we are ensuring that we continue to focus our resources on the assets and developments which we believe will provide the best opportunities to deliver greater shareholder value in the future.'

90North was established by Philip Churchill and Nick Judd, specialists in Shariah-compliant investments, in 2011. The company, which says it offers clients 'independent, ethical and results-driven investment advice', has offices in London, Chicago and Kuala Lumpur. The investment portfolio spans the US, UK and Continental Europe.

Hammerson was advised by Savills and 90North was advised by Staunton Whiteman.

News of the investment transaction comes a day after Hammerson announced it had slashed its financing costs by agreeing a £415 mln unsecured revolving credit facility with nine banks. The new five-year facility has an initial margin of 80 basis points and replaces a previous facility which had a margin of 150 basis points.