2015 Full-year Results 15 February 2016
Draft 26/07/2016 Transfer to Print set up once finalised
Agenda
01 2015 highlights and strategy David Atkins – CEO
02 Financial results Timon Drakesmith – CFO
03 Portfolio update David Atkins – CEO
04 Conclusion and Q+A David Atkins – CEO
2
2015 highlights
3 (1) LfL NRI including premium outlets
Consistently strong performance
EPS +12.6% NAVPS +11.3% TPR 12.4%
New European market
Dublin, Ireland
Portfolio recycling
£360m disposals
Completed four developments
64,900m2 Total 25% profit on cost
Capturing rental growth
LfL NRI +3.1%(1)
2015 highlights and strategy
Investment management driving performance
4
Investment management
strategy
Leading position in the European market segment 1 European countries or cities with
strong macro indicators and infrastructure investment
2
Identified asset management opportunities 4 Venues matched to consumer
trends, in particular experience, convenience and luxury shopping tourism
3
2015 highlights and strategy
Building our portfolio to secure future growth
5
Irish loan portfolio, Dublin Grand Central, Birmingham Festival Park, Majorca
Kildare Village, Dublin
Acquisitions
Market-leading platform in Ireland
Quality retail in Birmingham, UK’s second city
Fast-growth premium outlets
£690m
Positive engagement with borrowers
£175m
50:50 joint venture signed with CPPIB
£46m
New VIA Outlet and increased stake in Kildare Village, Dublin
2015 highlights and strategy
On-going review of lower-return assets
6 Note: Premium for disposals versus 31 December 2014 book value
Monument Mall, Newcastle
[For script]: - Irish platform (hits all filters): immediate scale, Europe’s
fastest growing economy, significant asset management strategies; supported by new infrastructure
- GC: upscaling in B’Ham the UK’s fastest growing regional economy, consumer trends for convenience, infrastructure investment
- Martineau: also B’Ham, infrastructure HS2 - FP: consumer trend for shopping tourism, asset management
Villebon 2, Paris Bercy 2, Paris
Disposals
Completed successful asset management
Standalone retail park in France
Lower-return smaller shopping centres
£360m of disposals in last twelve months
Completed first tranche of £200m to finance Irish loan acquisition
Planned £300m of further disposals in course of 2016
Recycling capital in UK retail parks
Drakehouse, Sheffield
£75m
46% PoC
£62m
4% premium to BV
£47m
11% premium to BV
£116m
16% premium to BV
2015 highlights and strategy
Focus on strategic priorities continues to deliver strong results
7
NAVPS (pence)
710
400
450
500
550
600
650
700
750
2011 2012 2013 2014 2015
+11%
CAGR +7.6%
EPS (pence) DPS (pence)
26.9
10
12
14
16
18
20
22
24
26
28
30
2011 2012 2013 2014 2015
CAGR +8.7%
22.3
5
7
9
11
13
15
17
19
21
23
25
2011 2012 2013 2014 2015
CAGR +7.7%
+13% +9%
2015 highlights and strategy
Financial results
Timon Drakesmith – CFO
• Review of 2015 financial performance
• Analysis of valuation trends
• Details on recent changes in debt levels
• Funding capacity for our development pipeline
8
02
Headline results
9 (1) Adjusted profit and adjusted EPS restated from £85.0m and 11.6p respectively to exclude restructuring costs of £3.0m, which were excluded when calculating adjusted earnings figures for 31 December 2014
(2) Valuation for total portfolio including premium outlets at constant currency. Uplift is underlying capital return
Income statement 31 Dec 2015 31 Dec 2014 Change
Net rental income (£m) 318.6 305.6 +4.3%
Adjusted profit (£m)(1) 210.9 174.3 +21.0%
Adjusted EPS (p)(1) 26.9 23.9 +12.6%
Total dividend (p) 22.3 20.4 +9.3%
Balance sheet
Portfolio value (£m)(2) 8,374 7,734 +7.1%
EPRA NAVPS (p) 710 638 +11.3%
LTV (%) 38 34 +4 p.p.
Financial results
Positive LfL net rental income growth
10 (1) Includes LfL movement of UK other properties – principally assets held for development and non-core (2) Includes Value Retail only as VIA Outlets was acquired in July 2014
2.1 2.6 2.5 2.3
7.3
3.1
0
1
2
3
4
5
6
7
8
9
UK shopping centres UK retail parks France Total exc. Premiumoutlets
Premium outlets Total
2015 LfL NRI growth by sector (%)
(1) (1) (2)
Financial results
Strong profit growth
11
174.3
210.9
6.0 5.5
9.7 5.9 0.2
12.3
(3.0)
100
120
140
160
180
200
220
2014 2015
Adjusted profit movement (£m)
LfL NRI Acquisitions and disposals
Developments Premium outlets
Admin FX & other Financing
+21.0%
Financial results
Valuation analysis
12 (1) At constant exchange rates (2) Figures on a proportionally consolidated basis (3) Principally assets held for redevelopment and non-core (4) Premium outlet figures relate to Hammerson interests
2015 capital return(1)
Components of underlying valuation change
Value at 31 Dec 2015(2)
(%) Yield shift (%)
Income (%)
Other (%)
(£m)
UK shopping centres +6.8 +4.4 +2.3 - 3,065
UK retail parks +1.3 −0.2 +1.5 −0.1 1,656
France +7.1 +9.3 −0.9 −1.7 1,861
UK other interests(3) +1.7 +1.8 +0.7 −1.4 160
Developments +12.3 - - +12.3 388
Premium outlets(4) +16.4 +7.2 +9.4 +0.2 1,244
Total ex Ireland +7.1 +4.9 +2.4 −0.1 8,374
Irish loan portfolio 690
Total inc Ireland 9,064
Financial results
NAVPS uplift
13
638
710
47
22
27 (21)
(3)
580
600
620
640
660
680
700
720
740
760
Dec 2014 Dec 2015
Adjusted NAV movement (pence per share)
Portfolio revaluation
Premium outlets
revaluation
Adjusted profit
Dividends FX & other
+11.3%
Financial results
Healthy financing ratios
14
Financing policy 31 Dec 2015 31 Dec 2014
Net debt - £2,968m £2,265m
Gearing <85% 54% 46%
Loan to value <40% 38% 34%
Cash/undrawn facilities - £931m £648m
Weighted average cost of finance - 3.8% 4.7%
Interest cover >2.0x 3.6x 2.8x
Net debt/EBITDA <10x 9.6x 8.0x
Fixed rate debt >50% 61% 79%
GBP/EUR fixed balance sheet hedging 80% - 90% 90% 88%
Financial results
Management of leverage
15
Today Proformas
Actual 31 Dec 2015 (1)
Post 50% Grand Central and announced disposals (1)
Conversion of Irish loans to property by summer 2016 (2)
£300m disposals by end 2016
Net debt £2,968m £2,951m £3,164m £2,864m
LTV 38% 38% 39% 37%
(1) Value denominator includes £690m acquisition cost of Irish loan portfolio (2) Payment for conversion to property including balancing payment to Allianz (total £220m)
Financial results
Controlled deployment of capex
16 (1) On-site developments include Victoria Gate, Leeds and WestQuay Watermark, Southampton (2) The Goodsyard - Phase 1 only . Note: Additional pipeline development opportunities shown in Appendix
Forecast development expenditure (£m)
Committed capex at on-site developments (1)
Brent Cross extension
Croydon town centre
The Goodsyard (2)
Discretionary capex
Average annual capex
2013-2015
-
50
100
150
200
250
300
2016 2017 2018 2019 2020
Financial results
Debt maturities and refinancing plan
17 (1) As at 31 December 2015 shown on a proportionally consolidated basis
0
100
200
300
400
500
600
700
800
2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028
Revolving credit facilities
US private placement
Sterling bonds
Euro bonds
Secured debt
Debt maturity profile (£m) (1)
Recent financings (£1.7bn) • £1.1bn credit facility (£691m drawn down at 31 December 2015) • £350m 2025 bond issue (2.5% effective coupon) • £272m bond redemption originally due December 2016
Future funding plans • Refinancing of 2017 RCF with new debt issuance and disposals • Credit agencies reaffirmed ratings
Financial results
Portfolio update
David Atkins - CEO
Shopping centres
• UK
• Ireland
• France
Retail parks
Premium outlets
Developments 18
03
Positioned in prime assets delivering growth across the group
19 (1) Includes UK other interests – principally assets held for redevelopment and non-core
UK shopping centres
34%
French shopping centres
20%
Retail parks 18%
Premium outlets 14%
Other/developments(1)
6%
Our portfolio today
Irish shopping centres (loans) 8%
Occupancy
97.7%
Leases signed
400 leases (£28m)
Leasing vs previous passing
+9.5%
Portfolio update
Portfolio update: Shopping centres, UK
Brent Cross, London
Grand Central: highly-prized new addition
21 (1) GVA per head (ONS)
50:50 JV with CPPIB; Hammerson £175m net investment
Adjacent to Bullring
Largest John Lewis store outside London
Birmingham economic growth second only to London in UK (1)
£750m New Street Station regeneration
12% rental reversion on retail
7-8% IRR
Forecast run-rate annual centre footfall
22m
% catering
18%
40,400m2
Size
Portfolio update: Shopping centres, UK
Sales patterns reflect shopper confidence
22
Hammerson UK shopping centres
Retail sales(1) +1.3% (+80bps vs index(2))
Footfall +1.1%
Car park usage(3) +4.1%
(1) Hammerson UK same-centre retail sales growth (2) VISA face-to-face spending index (2015: 0.5%) (3) Car count at Hammerson UK shopping centres
-1%
0%
1%
2%
3%
4%
5%
6%
7%
Fashionaccessories
Departmentstores
Gifts & cards Fashion Footwear Catering Leisure &travel
Jewellery Technology Health &beauty
Sport &Outdoors
[Script: - Disposable income growth driven by real
wages - Record levels of consumer confidence - Affordable luxury / experiences, jewellery,
[cinema takings], spa & beauty products all doing well
- These categories account for [just under 50]% of Hammerson’s base rent, recognising the importance these retailers put on their physical presence
- Fashion tougher year – deflation in clothing [ ]%, discounting, warm weather in winter]
YoY sales growth by category in Hammerson UK shopping centre portfolio(%)
Portfolio update: Shopping centres, UK
Multichannel drives greater efficiency of prime retail space
23 (1) Adjusted for online returns to store and attributing click & collect purchases (2) Source: CBRE/IPF research (3) Pure-play online sales (predominantly ASOS, very.com, boohoo and Amazon) fulfilled in shopping
centre via Collect+ kiosk
1. Online returns and Click & Collect (1)
3. Collect+ (3)
2. Retail ‘halo’ effect (2)
Incremental sales driven by multichannel
+10%
+5-6%
+1-2%
In store sales
1 2 3
Portfolio update: Shopping centres, UK
Competition for the best retail space
24
-50%
-30%
-10%
10%
30%
50%
70%
90%
Hammerson UK shopping centre principal leasing deals vs ERV
Tenant-mix deals
International brands/ upsizing
Unit stores and new concepts
Catering
Hammerson UK shopping centres
Number of leases at or above ERV 73%
Leasing vs previous passing +8.8%
Leasing vs ERV +3.5%
ERV growth +2.8%
Portfolio update: Shopping centres, UK
Growth in non-rental income
25
4
6
8
10
12
14
16
2012 2013 2014 2015
Other
Storage
Vending
Car valeting
Kiosks
Advertising &promotions
Strong demand for in-mall kiosk space
Small enterprises with unique and attractive concepts
Established brands looking for space alternative when no units available or trialling market
Investment in design shown to deliver +35% sales uplift
Successful pop-ups moving up to permanent leases (Tesla, Cath Kidston)
UK shopping centre commercialisation revenue (£m)
Car park income
2015 net income £23.1m
LfL YoY growth +4.1%
Bad Brownie, Oracle
The White Company, Oracle Cath Kidston, Brent Cross
TESLA, Brent Cross +9%
Income from kiosks +29% in 2015
Portfolio update: Shopping centres, UK
Portfolio update: Shopping centres, Ireland
26 Dundrum, Dublin
Strengthening our European retail platform with new Irish portfolio
27 Note: Structure of property ownership on conversion of loans: (1) Hammerson/Allianz 50:50 JV (2) 50% co-ownership with IPUT (25%) and Irish Life (25%). Development site 100% Hammerson (3) 50% co-ownership with Irish Life (50%)
Dundrum Town Centre(1)
Dundrum Phase 2 Development site(1)
Dublin Central Development Site Pavilions, Swords(2) Ilac Centre(3)
Fastest growing European economy
Best quality retail in Dublin
Leading market position
Dundrum Town Centre 50% ownership (JV with Allianz)
Development sites at Dundrum and central Dublin
Strong reversion potential
IRR 7-8%
Total footfall
48m
Total development opportunity
27 acres
200,000m2
Total retail area
Portfolio update: Shopping centres, Ireland
On track with asset conversion
28
Hammerson acquisition costs
£m
Face value of Irish loan portfolio (50%) 960
Hammerson loan acquisition cost (50%) 690
Expected expenditure on fees, tax and Allianz re-balance 220
Forecast total investment 910
Continuing positive engagement with borrowers
On track for property ownership by summer 2016
Hammerson operational team established in Dublin
Update on transfer to property ownership
Portfolio update: Shopping centres, Ireland
Exceptional economic backdrop in Ireland
29
0
1,000
2,000
3,000
4,000
5,000
6,000
7,000
8,000
9,000
19
99
20
00
20
01
20
02
20
03
20
04
20
05
20
06
20
07
20
08
20
09
20
10
20
11
20
12
20
13
20
14
20
15
20
16
F
Grafton St Henry St
Sources: OECD; Ireland CSO; KBC/ESRI; National Tourism Development Authority; CBRE
Dublin rental growth (€/m2)
2015 GDP growth +6.7%
2015 Retail sales value growth +3.6%
2015 new car sales growth +18%
Unemployment 6-year low at 7.8%
Consumer confidence at 8-year high
8.6 million tourists in 2015, +14%
2015 GDP growth 5.6% (OECD) 2015 retail sales volume growth 6.7% (Ireland CSO) 2015 new car sales growth 18% (Ireland CSO) Unemployment 6-year low at 7.8% (Ireland CSO) Consumer confidence at 8-year high, notably more optimistic on jobs market (KBC/ESRI) 8.6 million tourists in 2015, up 14% (National Tourism Development Authority)
Portfolio update: Shopping centres, Ireland
Europe’s fastest growing economy
Dundrum leasing deals above expectations
30
Rent reviews settled on average +10% vs previous passing
Portfolio update: Shopping centres, Ireland
Strong trading reflecting consumer confidence
Tenant sales (2015 YoY) (1) +6.0%
Footfall (2015 YoY) +1.3%
Rental uplift +29%
Consolidates luxury mall
Upsize and full refit
Top 15 store globally
Bought out previous lease
Over 2.5x previous rent
(1) Retail sails for Dundrum Town Centre, based on available data
Portfolio update: Shopping centres, France
Le Jeu de Paume, Beauvais
2012 - 2015: Repositioning of our French portfolio
32 (1) Premium for disposal vs 31 December 2014 book value
Significant work to transform French platform
Refurbishments Selective disposals Developments Acquisitions
£30m
Attracting new brands
Total £210m
15% premium to BV(1)
Total £420m
35% PoC
Total £125m
8% valuation uplift
Portfolio update: Shopping centres, France
Lifting quality and performance with re-tenanting
Number of units re-tenanted across portfolio
Portfolio update: Shopping centres, France
Hammerson France portfolio
Leasing vs previous passing +9.7%
Leasing vs ERV +1.5%
New brands
0
20
40
60
80
100
120
140
160
180
200
2014 2015 2016 +
51 units
78 units 2015 target
33
Target 20% retail offer renewed
Turnaround in performance
34 (1) Hammerson France same-centre retail sales growth. Includes all shopping centres, excludes extensions and developments
Hammerson France portfolio performance (% growth)
-3.0% -2.7%
-1.0%
0.6%
-4.0%
-3.0%
-2.0%
-1.0%
0.0%
1.0%
2.0%
3.0%
2012 2013 2014 2015
Sales NRI excl. Indexation NRI
Portfolio update: Shopping centres, France
(1)
Portfolio update: Retail parks
35 B&Q Eco learning store, Cyfarthfa retail park, Merthyr Tydfil
Rugby image
Elliott’s Field, Rugby Elliott’s Field, Rugby
Focused strategy in retail park market
36 (1) Source: PMA
Shopping parks Hybrid parks Key homeware goods parks
Standard homeware parks
Solus units
2.7% 2.5% 2.0% 1.8% 1.5%
Hammerson investment focus
Market forecast rental growth(1)
UK Retail Park market(1)
5%
23%
12%
16%
43%
13%
30%
39%
8%
13%
Shopping parks
Hybrid parks
Key homeware goods
Standard homeware
Solus
79% by number of properties
40% by number of properties
Hammerson portfolio
Portfolio update: Retail parks
Insert footfall versus market HMSO +4.2% Market +2.3%
Taking advantage of strong occupational demand
37
Shopping parks Hybrid parks Key homeware goods parks
Share of lettings: 64%
Leasing vs ERV: +2% Share of lettings: 10%
Leasing vs ERV: +11%
Share of lettings: 20%
Leasing vs ERV: +10%
Portfolio update: Retail parks
Hammerson retail parks portfolio
Leasing vs previous passing +7.7%
Leasing vs ERV +4.2%
ERV growth +1.3%
ERV growth
Portfolio update: Premium outlets
La Vallée Village, Paris Kildare Village, Dublin
Insert new picture? Kildare Village, Dublin
New investments in premium outlets
Ownership increased from 14% to 38%
£14m investment, Hammerson share
Extension completed: 33 new boutiques and two
restaurants and hospitality services
Footfall exceeded 3 million in 2015
39
Value Retail: Kildare Village, Dublin
Acquired Majorca’s only major outlet centre
£32m investment, Hammerson share
87 stores, including restaurants and a cinema
Open 7 days a week
3.8 million visitors per year
VIA Outlets: Festival Park, Majorca
Portfolio update: Premium outlets
Premium outlets continue to grow strongly
40
Value Retail VIA Outlets
Sales growth +11.0% +9.6%
Sales density €15,000/m2 €3,300/m2
Sales density growth
+8.4% +11.2%
Key 2015 leasing deals at VIA Outlets:
Portfolio update: Premium outlets
Landquart, Zurich
Trends in European luxury shopping
41 Source: Global Blue (1) Other Asia: Hong Kong (4%), Malaysia (3%), Korea (3%), Thailand (2)%, Singapore (2%), Taiwan (2%),
Indonesia (1%), Philippines (1%), Vietnam (1%) (2) Gulf States: Kuwait (4%), Saudi Arabia (3%), UAE (2%) and Qatar (2%)
Total European tax refunded sales by nationality, 2015
Proportion of total YoY change
China
Other Asia(1)
Gulf States(2)
Other
Russia
43%
19%
12% 5%
21%
+32%
+20%
+18%
- 41%
+17%
Portfolio update: Premium outlets
Portfolio update: Developments
42 Leeds aerial VG pic?
Victoria Gate, Leeds Victoria Gate, Leeds Victoria Gate, Leeds
On site developments: Victoria Gate, Leeds
43
Creating the premium and aspirational shopping offer for the north of England
Portfolio update: Developments
Under offer and advanced negotiations
83%
Size
35,400m2
Total project cost
£165m; 6.4% YoC
Completion
Q3 2016
Pre-lets exchanged
68%
Can we announce brands? No.
On site developments: WestQuay Watermark, Southampton
44
Consolidating WestQuay and Watermark as the city’s leading leisure and retail destination
Under offer and advanced negotiations
89%
Size
17,000m2
Total project cost
£85m; 6.0% YoC
Completion
Q1 2017
Portfolio update: Developments
Pre-lets exchanged
80%
Major developments: Croydon
45
2015 CPO Inquiry confirmed
Acquisition 50% interest in Whitgift centre (total 75%)
Revised design of enhanced three level scheme – capex refined
Advance retailer discussions
Bought further land interests
2016 Sign anchor commitments
Submit detailed planning for enhanced scheme
Transforming South London’s retail and leisure offer
(1) Hammerson share
Croydon Partnership retail
200,000m2
Cost to complete(1)
£650 - 700m
Earliest start
2017
Portfolio update: Developments
Major developments: Brent Cross
2015 Infrastructure planning consents approved
Advanced tenant mix proposals
May 2016 confirmed date for CPO inquiry
Secured infrastructure funding to bring forward a new rail station
2016 CPO inquiry to be held
Sign anchor commitments
Work up detailed scheme design
Regenerating North London’s iconic retail destination
(1) Hammerson share
New CGI image to come
Incremental retail space
90,000m2
Cost to complete (1)
£475-550m
Earliest start
2017
Portfolio update: Developments 46
Major developments: The Goodsyard
47
2015 GLA support for the scheme
Revised planning application submitted June 2015
• 25,000m2 additional commercial space
• Revised office and residential buildings design
2016 Planning determination scheduled March 2016
New employment, retail and commercial opportunities
Opportunity to create a new London village
(1) Hammerson share
Size (gross external area)
270,000m2
Total Phase 1 cost to complete(1)
£140-160m
Earliest start
2017
Replace!!
Portfolio update: Developments
Conclusion
48
04
Proven strategy delivering consistent performance
49
Resilient business model
Disciplined investment management
Embedded growth
Prime property
NAVPS (pence)
710
400
450
500
550
600
650
700
750
2011 2012 2013 2014 2015
+11%
CAGR +7.6%
EPS (pence) DPS (pence)
26.9
10
15
20
25
30
2011 2012 2013 2014 2015
CAGR +8.7%
22.3
5
10
15
20
25
2011 2012 2013 2014 2015
CAGR +7.7%
+13% +9%
Questions
50
Disclaimer
51
Appendices
52
53 (1) As at 31 December 2015, including Irish loan portfolio
Property portfolio
£9.1 billion
Annual visitors
280 million
Retail space
2.2 million m2
Portfolio overview (1)
Hammerson invests in prime retail assets throughout Europe
UK shopping centres 34%
France 20%
UK Retail Parks 18%
Premium outlets 14%
Irish loan portfolio
8% Gross Asset Value
£9.1bn
UK shopping centres
£3.1bn
France £1.9bn
UK Retail Parks
£1.7bn
Premium Outlets
£1.2bn
Ireland retail (loans)
£0.7bn
Other/ developments
£0.5bn
Our assets
Other/ developments 6%
Appendices
Household consumption
54 Source: Marketline analysis (using data from Eurostat, OECD and ONS)
-15
-10
-5
0
5
10
15
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
United Kingdom France Ireland
Growth in household final consumption expenditure (%)
UK shopping centres 34%
France 20%
UK retail parks 18%
Premium outlets 14%
Irish loan portfolio
8%
Tenant sales growth across the portfolio
55 (1) 2015 retail park footfall increase (2) 2015 Value Retail sales (3) Retail sales for Dundrum Town Centre, based on available data
Other/developments 6%
UK shopping centres +1.3%
France shopping centres +0.6%
Retail parks(1) +4.2%
Premium outlets(2) +11.0%
Ireland shopping centres(3) +6.0%
Appendices
Sales growth
2015 French sales overview
56
-8.0%
-6.0%
-4.0%
-2.0%
0.0%
2.0%
4.0%
6.0%
8.0%
10.0%
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Appendices
Tenant sales growth in Hammerson France portfolio 2015 (%)
Operational statistics
57 (1) Retail sales on same-centre basis, includes all shopping centres (2) France data includes VAT
Appendices
Occupancy (%) UK shopping centres
UK retail parks
France Devs & other Group
31 December 2015 98.3 98.4 96.9 91.0 97.7
30 June 2015 97.8 98.2 96.7 89.0 97.2
31 December 2014 98.1 98.5 96.6 91.3 97.5
UK shopping centres
France
Sales(1) +1.3% +0.6%
Footfall +1.1% −0.6%
Rent:sales(2) 12.1% 11.1%
OCR(2) 19.2% 14.0%
Sales densities(2) UK £/ft2
France £/ft2
2015 310-620 220-621
2014 290-590 200-610
2013 270-560 200-620
Positive uplift in rents for the group in 2015
58 (1) Including UK Other properties – principally assets held for development and non-core
Leasing vs previous passing
Leasing vs ERV ERV growth Rent secured from new leases
UK shopping centres +8.8% +3.5% +2.8% £11.7m
UK retail parks +7.7% +4.2% +1.3% £8.3m
France +9.7% +1.5% 0.0% £7.2m
Group (1) +9.5% +2.0% +1.6% £27.9m
Appendices
14.6% 13.3% 12.8% 11.8%
11.9% 10.9%
10.0% 11.3%
0%
5%
10%
15%
20%
25%
30%
2012 2013 2014 2015
Corporate expenses Operational costs
Cost:income ratio
59
Cost:income ratio (%)
26.5% 24.2%
22.8% 23.1%(1)
(1) Excluding car park costs (£9.3m in 2015) cost:income ratio would be 21.1% Appendices
Recycling capital in 2015
60
Disposals Date of disposal Value £m
Above book value (1)
Drakehouse retail park, Sheffield April 2015 62 4%
Bercy 2, Paris June 2015 47 11%
Grand Maine, Angers July 2015 45 16%
Monument Mall, Newcastle December 2015 75 1%
Kingston-upon-Thames land interest December 2015 12 1%
Villebon 2, Paris January 2016 116 16%
Total 357 9%
(1) Book value as at 31 December 2014
Appendices
On site and major developments
On site developments(1) Lettable area m2
Potential completion
Current value £m
Estimated cost to complete(2)
£m
Estimated annual income(3)
£m
Let(4) %
Victoria Gate (Phase 1), Leeds 35,400 Q3 2016 116 68 11 62
WestQuay Watermark, Southampton 17,000 Q1 2017 38 56 5 80
Total 52,400 124 16
61
Major developments Ownership %
Lettable area m2
Earliest start Potential completion
Estimated cost to complete £m
Croydon town centre, South London 50 200,000 2017 2020/21 650-700
The Goodsyard, London E1(5) 50 270,000 2017 Phased 140-160
Brent Cross extension, London NW4 41 90,000 2017 2021 475-550
Total 560,000 1,265-1,410
(1) Group ownership 100% for all on site schemes (2) Incremental capital cost including capitalised interest (3) Incremental income net of head rents and after expiry of rent-free periods (4) Let or in solicitors' hands by income at 12 February 2016 (5) Cost reflects phase 1 only. Due to residential component of scheme, area is gross external and income is not applicable (6) € converted at £1 = €1.357
Appendices
Development pipeline opportunities
Scheme Lettable area m2
Key Facts
Silverburn (Phase 4), Glasgow 50,000 • Consent granted in October 2015 for a masterplan for a future extension of existing centre • Masterplan includes retail, hotel and leisure uses
Union Square, Aberdeen 27,800 • Extension of existing shopping centre for retail, leisure and catering. Including additional car
parking and a hotel and reconfiguration of part of existing centre • Planning application submitted in February 2016
Victoria Gate, Leeds (Phase 2)
73,000 • Planning consent for retail-led scheme, including up to 2,700 car park spaces • Freehold control of site obtained
WestQuay Watermark, Southampton (Phase 2)
58,000 • Outline planning consent for mixed-use scheme • Council-owned land, with joint review of scheme under way
Oldbury, Dudley 10,900 • Planning submitted in January 2016 for new development
Orchard Centre, Didcot 10,000 • £50 million expansion of existing centre with M&S Food Hall anchor • Planning approval in July 2015
Parc Tawe, Swansea 21,000 • Refurbishment and modernisation of existing retail park • Planning dispute successfully appealed in September 2015
Italie Deux, Paris 13ème 5,100 • Retail extension of existing shopping centre • Progressing necessary consents to enable start-on site
Les 3 Fontaines, Cergy Pontoise
24,500
• Retail and leisure extension as part of wider city centre project • Submission of a number of consent applications and agreement with a number of co-owners
achieved in first half of 2015 • Awaiting confirmation of consents and final co-ownership agreements
SQY Ouest, Saint-Quentin-en-Yvelines
30,200 • Opportunity to reposition existing shopping centre, creating a leisure-led destination
Total 310,500
62 Appendices
Premium outlets overview
63
Value Retail Villages VIA Outlet centres
Bicester Village, UK Kungsbacka, Gothenburg
Kildare Village, Dublin Batavia Stad, Amsterdam
Maasmechelen Village, Brussels
Fashion Arena, Prague
Wertheim Village, Frankfurt Festival Park, Majorca
La Vallée Village, Paris Landquart, Zurich
Ingolstadt Village, Munich Alcochete, Lisbon
Fidenza Village, Milan
La Roca Village, Barcelona
Las Rozas Village, Madrid
Appendices
International fashion and
luxury brands
Mainstream fashion brand outlets
Low-end discount outlets
Premium outlets
64
Value Retail brand sales (€m)
20
06
20
07
20
08
20
09
20
10
20
11
20
12
20
13
20
14
20
15
Value Retail
VIA Outlets
<€2,000
€2,000–€10,000
€30,000+
Incr
easi
ng s
ale
s den
sitie
s €
/sq m
Segmentation of Outlet market
Fashion Arena, Prague
CAGR 17%
Hammerson’s investment in Value Retail
Holding companies 22% equity
Bicester Village
33
45
La Roca Village
23
35
Las Rozas Village
19
31
La Vallée Village
11
22
Maasmechelen Village
13
24
Fidenza Village
20
32
Wertheim Village
31
43
Ingolstadt Village
0
11
Kildare Village (2)
27
38
65 (1) Excludes €46m of additional loans secured against various Value Retail assets (2) Including acquisition of additional stake completed in January 2016
Village ownership via LPs (%)
Total Village ownership (%)
Hammerson €58m(1) shareholder loan
Appendices
Premium outlets share of results
66 Appendices
Income statement 2015 2014
Value Retail £m
VIA Outlets £m
Total £m
Value Retail £m
VIA Outlets £m
Total £m
Profit for the year 159.3 13.1 172.4 109.9 (1.1) 108.8
EPRA adjustments (142.2) (7.0) (149.2) (93.9) 2.0 (91.9)
Adjusted earnings of premium outlets
17.1 6.1 23.2 16.0 0.9 16.9
Interest receivable from Value Retail loans
5.3 - 5.3 5.8 - 5.8
Total contribution to adjusted profit
22.4 6.1 28.5 21.8 0.9 22.7
Balance sheet
Share of net assets 743.8 110.8 854.6 628.8 104.2 733.0
EPRA adjustments 59.9 6.8 66.7 31.9 4.0 35.9
EPRA adjusted investment 803.7 117.6 921.3 660.7 108.2 768.9
Investment in VR China (within Other investments)
4.8 - 4.8 - - -
Loan to Value Retail 76.4 - 76.4 63.5 - 63.5
Total impact of balance sheet – EPRA basis
884.9 117.6 1,002.5 724.2 108.2 832.4
Our sustainability vision
67
2015 Highlights
To create retail destinations that deliver positive impacts economically, socially and environmentally
2016 Plans
• 4% reduction in Group CO2e
emissions intensity
• Four industry sustainability
awards
• Delivered net zero energy
EcoPod for Costa
• £2m saved through waste
management
• 3% reduction in electricity
demand in UK
• £174k savings in electricity costs
• Retained GRESB Green Star and
improved scores in all industry
benchmarks
• £2m+ Community investment
• 6% Reduction in electricity
consumption
• 5% reduction in landlord water
intensity
• 3% reduction in CO2e
emissions
• 98% diversion of waste from
landfill
• Install renewable technology
on one existing asset
• Update True Value of
Shopping Centres research
• Further senior management
sustainability training
Our sustainability vision
68
To create retail destinations that deliver positive impacts economically, socially and environmentally
Our 2010-2015 targets Our performance
Our 2015 – 2020 ambitions
Reduce like-for-like carbon emissions by 20% v. 2010 baseline by 2015
-20% 20% reduction in carbon emissions v 2015 baseline
45% of suppliers by value to be engaged with on sustainability, annually
88% Introduce refreshed sustainable supplier survey in 2016 in the UK and France and continue to improve supplier engagement on sustainability
Increase waste recycling to 85% by 2015
UK 76% France 50%
100% diversion from landfill in the UK, 98% in France
Biodiversity action plans at all retail assets by 2015
32/41 in place Work with partners to trial pioneering, restorative approaches to biodiversity at six managed assets
All employees to complete CR training biennially
59% employees trained 2015 100% of Hammerson employees employed for 12 months or more to receive sustainability training
Reduce water consumption from 2010 by 12% by 2015
UK +28% France -29%
Reduce landlord water intensity by 10%
Lease expiries and breaks as at 31 Dec 2015
69 (1) The amount by which rental income, based on rents passing at 31 December 2015, could fall in the event that occupational leases due to expire are not renewed or replaced by new leases. For the UK, it includes tenants’ break options. For France, it is based on the date of lease expiry.
(2) The ERV at 31 December 2015 for leases that expire or break in each year and ignoring the impact of rental growth and any rent-free periods.
Rents passing that expire/break in
ERV of leases that expire/break in
Weighted average unexpired lease term
Proportionally consolidated excluding premium outlets
2016 £m
2017 £m
2018 £m
2016 £m
2017 £m
2018 £m
To break years
To expiry years
Notes 1 1 1 2 2 2
United Kingdom
Shopping Centres 21.5 9.3 24.3 26.2 9.5 22.9 6.2 8.1
Retail Parks 7.8 2.1 3.3 9.0 2.3 3.3 8.7 9.7
Other 2.4 1.0 1.9 3.0 1.1 1.4 9.3 10.4
Total 31.7 12.4 29.5 38.2 12.9 27.6 7.3 8.8
France 13.5 4.6 3.6 15.2 4.8 4.1 2.7 5.8
Total investment portfolio 45.2 17.0 33.1 53.4 17.7 31.7 6.0 8.0
Appendices
Rent reviews as at 31 Dec 2015
70 (1) Rents passing at 31 December 2015, after deducting head and equity rents, which are subject to review in each year
(2) Projected rents for space that are subject to review in each year, based on the higher of the current rental income and the ERV as at 31 December 2015 and ignoring the impact of changes in rental values before the review date
Rents passing subject to review in ERV of leases to review in
Proportionally consolidated excluding premium outlets
Outstanding £m
2016 £m
2017 £m
2018 £m
Outstanding £m
2016 £m
2017 £m
2018 £m
Notes 1 1 1 2 2 2
United Kingdom
Shopping Centres 26.8 9.5 12.5 19.2 30.8 10.2 13.4 20.8
Retail Parks 37.2 14.5 9.2 8.8 38.4 14.8 9.4 9.2
Other 4.9 0.9 0.8 0.5 5.2 0.9 0.9 0.5
Total 68.9 24.9 22.5 28.5 74.4 25.9 23.7 30.5
Appendices
Valuation data
71 (1) Excludes premium outlets
UK shopping centres
UK retail parks France retail UK Other interests
Total continuing portfolio
True equivalent yield (%)(1)
31 Dec 2015 5.2 5.6 4.7 7.6 5.2
31 Dec 2014 5.4 5.6 5.3 7.2 5.5
Change (bps) (20) 0 (60) 40 (30)
ERV (£m)
31 Dec 2015 166.2 90.9 101.0 13.6 371.7
31 Dec 2014 160.8 87.4 107.0 13.4 368.6
Change (%) 3.3% 4.0% (5.6%) 1.5% 0.8%
Appendices
Components of valuation change
72 Note: The total portfolio movement includes the movement in the UK Other interests portfolio where valuations changed by a total of £1m during 2015
Components of valuation change in 2015 – total portfolio (£m)
127
(3)
161
0
287
67 24
(15)
0
77
1
(2)
(29)
36 4
195
19
117
36
368
-50
0
50
100
150
200
250
300
350
400Yield Income Development & other Total
UK shopping centres UK retail parks France Total Portfolio Developments
Appendices
Tenants in administration
73
31 December 2015 % of passing rents
51 units in administration 1.1
4 units unoccupied 0.1
30 June 2015
52 units in administration 1.0
10 units unoccupied 0.3
31 December 2014
55 units in administration 1.0
13 units unoccupied 0.4
Appendices