Hammerson has bought the remaining 50% interest in The Oracle shopping centre in Reading from its joint venture partner, a wholly owned subsidiary of the Abu Dhabi Investment Authority, for £104.5 million.
The acquisition, which follows a series of such acquisitions from its partners at its malls including Bullring, Westquay and Brent Cross, was announced alongside an update that showed solid year-to-date trading performance and upgraded EPRA earnings guidance for full year 2025.
The acquisition of the Oracle stake represents a stabilised yield of 8.9% and the opportunity to capture its future growth, the REIT said, adding that it will likely be around 5% accretive to its full year 2026 EPRA earnings.
The Oracle has seen the repurposing recently of the former House of Fraser to new offers from TK Maxx and Hollywood Bowl. There have also been additional leasing deals including flagship store upsizes with Zara and Apple, both due to open in the first half of next year, and renewals with L’Occitane and Space NK.
Year to date, it has exchanged 30 deals at The Oracle, representing £4.5 million of headline rent, or around £21 million of rent contracted to first break. It said it had driven occupancy up from 93% at the start of the year to 97%.
Hammerson said the value is up 11% since 2023, benefitting from the investment in repositioning, and there are additional opportunities to unlock further value, including the former Debenhams and existing cinema block around the riverside where it is exploring retail, F&B, leisure and BTR options.
Hammerson also announced an EPRA earnings upgrade reflecting what it termed "continued momentum and the acquisition of The Oracle".
Total gross rental income growth has been raised to 19% (from the 17% previously guided), with like-for-like gross and net rental income growth expected to be around 3%.
The EPRA earnings forecast has been increased to “at least” £102 million (previously “around” £101 million).
Hammerson said third quarter group footfall increased by 5% year-on-year and like-for-like sales grew 2%, with Q3 year-to-date group footfall and like-for-like sales both up 2%.
It has signed 261 leases with £38 million of headline rent, representing £190 million of contracted rent to first break, at 49% ahead of previous passing rent and 12% ahead of ERVs.
Hammerson says the UK is a particular highlight with deals representing £20 million of headline rent exchanged 43% above previous passing rent and 16% ahead of ERV.
The group’s resulting occupancy is 95%, which it expects to improve with ongoing repositioning.
The acquisition of The Oracle is funded from existing cash on balance sheet with a resulting third quarter 2025 pro forma LTV of around 37%.
Rita-Rose Gagné, CEO of Hammerson, said in a statement: “We have seized the opportunity to gain full control of The Oracle, an asset in transition, to capture the growth opportunities ahead. This represents our fourth JV buyout in a little over a year, as we continue to act decisively and execute our growth strategy at pace.
"Our recent investments at The Oracle have driven an uplift in footfall, sales and leasing with the recent openings of TK Maxx and Hollywood Bowl. We expect a further boost from the opening of flagship stores for Zara and Apple in early 2026. There is more to come.
"Combined with our continued strong performance and acquisition of The Oracle, we expect further growth in 2026 and 2027 as the full benefits of our repositionings and acquisitions come through, underpinning the group’s medium-term guidance of an 8-10% EPRA EPS CAGR.”