Hammerson has acquired a 50 per cent stake in the Manchester Arndale shopping centre for £218m, marking the FTSE 250 property firm's first major external acquisition in more than a decade as it expands its UK retail real estate portfolio.

The deal establishes Hammerson as co-owner of the largest shopping centre in Manchester and one of the biggest in Europe, a property comprising approximately 1.4 million square feet of retail floor space and drawing over 40 million annual visitors. The acquisition comes as UK retail property values show signs of stabilising following years of pandemic-era pressure that saw shopping centre valuations fall sharply and several major operators restructure or sell assets.

Hammerson chief executive Rob Wilkinson highlighted Manchester's economic strengths in a statement, positioning the acquisition within a broader trend of corporate leaders increasing their focus on the region following Andy Burnham's arrival in Downing Street. Manchester has been a focal point of UK government regional development policy under the Northern Powerhouse and levelling up agendas, with the city consistently ranking among the fastest-growing urban economies outside London.

"Manchester is one of Europe's most dynamic and fastest-growing urban economies, benefiting from strong demographics, excellent connectivity and the largest retail catchment outside London," Wilkinson said. "Manchester Arndale sits at the heart of this exceptional city and has established itself as a premier retail destination, attracting more than 45 million visitors each year."

"Ownership of this prime asset allows us to further strengthen our position in one of the continent's leading cities," he added.

To finance the acquisition, Hammerson launched a £190m equity issue, with a portion allocated for retail investors through London-based platform Retailbook.

Alongside the acquisition announcement, Hammerson reported a five per cent increase in like-for-like rental income and retail occupancy of 96 per cent, its highest level in seven years. The company also upgraded its earnings forecasts after recording a three per cent rise in footfall during the first half of the year. The improved metrics suggest that Hammerson's portfolio, which was hit hard during the pandemic when lockdowns forced extended retail closures, is benefiting from the broader recovery in physical retail footfall across the UK.

Hammerson also owns the Brent Cross shopping centre in London, which came under its full control last year following a £200m deal to buy out Aberdeen's stake.