Re Contracts

Hammerson PLC
13 July 2001

 

Hammerson in Major Paris Office Development

 
Hammerson plc has exchanged contracts to acquire a block of buildings,
centred around 14 boulevard Haussmann in central Paris, for euro175 million
(£106 million). The block will be redeveloped to create 31,100 sq.m.(335,000
sq.ft.) of high quality office accommodation in a prime business location.
 
The buildings are 14 boulevard Haussmann, 1-3-5-7-9 rue Pillet Will, Paris
9eme. The properties are currently vacant and have the benefit of an existing
building permit. Hammerson will progress a redevelopment of these properties,
behind the existing facades, to create two adjoining buildings, capable of
either being marketed separately or interconnected to provide floor plates of
around 2,000 sq.m.. It is anticipated that work on site will commence this
year with completion scheduled for mid 2003. Estimated total development
costs are euro290 million (£175 million).
 
The vendor is Immobiliere Finama, a subsidiary of the French insurance
company Groupama, and completion is anticipated in September 2001. The
acquisition is being funded by a euro-denominated drawing under one of the
group's existing medium term borrowing facilities.
 
Commenting on the transaction, John Richards, Hammerson Chief Executive, said:
 
         'These buildings are in a prestigious location in the heart of the
financial district favoured by major banks and insurance companies.
 
          Over the past few years we have built up a substantial business in
France with a portfolio valued at over £800 million at the end of 2000. We
have demonstrated our development expertise in several major projects in
central Paris, one of which, 40 rue de Courcelles, Paris 8eme, was recently
sold for £101 million to show a 50% profit on cost.
 
          There are market uncertainties at present but the fundamentals for
prime office buildings in central Paris remain attractive. The current
vacancy rate is only 2.5%, take up of new space remains strong and there is a
limited development pipeline of competing schemes.'
 
 
 
For further information:
 
John Richards                                         Tel: [phone]
Chief Executive, Hammerson plc
 
Christopher Smith                                     Tel: [phone]
Director of Corporate Affairs, Hammerson plc
 
Gerard Devaux                                     Tel: [phone]
Managing Director, Hammerson Europe