Hammerson plans to expand into the potentially lucrative French retail warehousing market by the end of next year.
Hammerson chairman Ron Spinney confirmed that the property group was 'exploring opportunities to enter the sector' in France. Chief executive John Richards said that although France's retail warehousing comprises unsophisticated, strip developments on the edge of towns, French retailers and consumers are as keen on the sector as their UK counterparts. 'There is definitely the appetite,' he said.
However, securing sites and planning is a 'challenge', admitted Richards.
'It is challenging to find good opportunities. We have set ourselves a target of finding something over the next 18 months, but it will be hard work,' he said.
Hammerson has set up a team within its 90-strong Paris office, working with property agents Cushman & Wakefield Healey & Baker, Jones Lang LaSalle and CB Richard Ellis Bourdais to establish a French warehousing presence.
Hammerson has more than£1 billion invested in the French market, representing some 28 per cent of its assets.
UK retail warehousing specialists have become increasingly interested in the fledgling European sector, where retailers' requirements for space and increased demand from investors push up the value of schemes.
Pillar Property has established the EUR500 million (£336.9 million) Pillar Retail European Fund to invest in the sector. Pradera Asset Management, backed by Henderson Global Investors, has invested in retail and leisure warehouse schemes in Spain, Italy, France and Greece. Prudential and Standard Life have also been looking at the European sector.
As well as building a stake in France, Hammerson is expec-ted to continue repositioning itself in the UK sector, which it entered two years ago via the£192 million takeover of Grantchester.
Hammerson is developing several schemes, including Cyfarthfa Retail Park at Merthyr Tydfil in Wales and St Oswald's Retail Park in Gloucester.
Further disposals are expected following the£88 million sale of Parc Fforestfach in Swansea, representing a yield of less than 4 per cent.
The scheme was acquired for£58 million two years ago.