New Leeds hotel planned in 10-acre Victoria Gate expansion

Hammerson is to seek permission to open the 8,400 square meter Victoria Hotel in addition to a 10 acre phase two development of Victoria Gate for development in 2021.

The group also announced immediate expansion plans for the Victoria Gate shopping centre. Prestons is due to open a Rolex boutique in late summer whilst Aspinal of London is to relocate to Victoria Quarter.

The firm said it has introduced a number of exclusive brands with temporary pop-up stores for Rapha, the premium UK cycling brand, at Victoria Leeds.

Victoria Leeds encompasses the Victoria Quarter and Victoria Gate shopping areas and includes a John Lewis store, a Harvey Nichols store, a Super Casino and over 90 boutiques.

Victoria Gate, which opened in October 2016, is anchored by John Lewis’s first store in the city. The arcades are also home to a range of premium brands including Anthropologie, GANT, Hackett, Jo Malone, Joules, Aspinal of London, Liz Earle, Le Pain Quotidien and international restaurant group D&D. Over 75 per cent of the brands at Victoria Gate are new to the city.

The Grade II listed Victoria Quarter building was bought by Hammerson in 2012 and the 160,000 sq ft scheme is set over two distinct shopping streets - County Arcade and Queen Victoria Street.

Hammerson said Leeds has an affluent population and a prominent position as the principal shopping destination in Yorkshire.

It said there is a big opportunity to capture growing consumer demand throughout the region by bringing new brands to the city. The Victoria Quarter scheme is anchored by Harvey Nichols and includes brands such as Louis Vuitton, Michael Kors, Vivienne Westwood and Reiss.

Hammerson announced its expansion plans for Leeds alongside interim results for the six months to June 30. The firm reported losses as its portfolio of shopping centres slumped in value amid challenges to the high street.

The retail property firm swung to a loss of £319.8m in the first half of 2019, compared with a £55.7m profit this time last year.On an adjusted basis, which is the company's preferred measure, profits were down 10.5 per cent to £107.4m.Net rental income fell 12.3 per cent to £156.6m.

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The headline loss was largely due to a £423.4m net revaluation loss on its property portfolio in the first half, as continuing market uncertainty and a slowdown in leasing hit value, especially in the UK.More than half of this was down to its flagship shopping destinations in the UK, which had a revaluation deficit of £266m.However, premium locations produced a revaluation surplus of £111m.

Rental income on a like-for-like basis fell 0.1 per cent.For UK flagship destinations the decline was steeper at 6.8 per cent, affected by CVAs and administrations leaving shops empty.

Hammerson's chief executive David Atkins said: "The UK retail landscape is undoubtedly challenging and traditional high street fashion is under pressure."However, our focus on shifting our line-up towards categories with greater customer appeal and rental growth potential has resulted in over 90per cent of new leasing to leading consumer and food and beverage brands."

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The group also said it had achieved 90 per cent of its target to sell off £500m worth of assets.This included a £423m deal with AXA IM Real Assets for a 75 per cent stake in Paris's Italie Deux shopping centre.

Mr Atkins said: "Our absolute priority remains to reduce debt. We stated our intention to achieve over £500m of disposals in 2019 and even in this tough environment where deals are taking longer to transact, we are now most of the way there."We will continue to pursue additional sales throughout 2019 and into 2020 to further strengthen our balance sheet."