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Investor PresentationSeptember 2014

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This document is dated 25 September 2014.

Proposal

• Cash box placing of c.71m shares, equivalent to c.9.9% of ISC immediately prior to the transaction

• Favourable outlook for investment into UK retail property and European outlet markets

– £180m acquisition of the remaining 40% interest in Highcross, Leicester, a top 30 UK shopping centre. Unlevered IRR >8%,

discount to June NAV

– At least £100m to increase exposure to outlet shopping centres

– New venture, VIA Outlets, alongside Value Retail, APG and Meyer Bergman, targeting European outlet shopping centres

with growth potential. Two acquisitions; total Hammerson expenditure of £70m by the end of 2014. Expected ungearedwith growth potential. Two acquisitions; total Hammerson expenditure of £70m by the end of 2014. Expected ungeared

IRR >10%

– Incremental capital of £30m to Value Retail to assist with extensions at villages in the UK and Ireland and for the new

Value Retail village in Shanghai

– c.£120m to be invested into major development programme. £195m(1) of capital committed to on site schemes and

significant progress on development pipeline

• Disciplined evaluation of acquisition opportunities balanced by selective disposals

• Maintains leverage below 40% LTV while retaining flexibility to fund significant development pipeline

• Immediately earnings accretive

(1) Estimated costs to complete of on site schemes at 30 June 2014

1

Vision to be the best owner-manager and developer of retail property within Europe

By capitalising on our strengths we aim to provide industry-leading shareholder returns

Experience LuxuryConvenience

EPS+4.5%

Interim Dividend

+6.0%

TSR(1)

+75%NAVPS+6.8%

Note: unless otherwise stated, figures presented are to 30 June 2014(1) TSR since announcement of strategic move toward focus on Retail (24 February 2012) to 19 September 2014

2

Bullring Value RetailJunction Fund Les Terrasses du Port

Proven track record of successful investment

Total new investment cost £154m

Ungeared IRR18%

since May 2013

Over £1 billion investment – IRR c.18%

Note: IRRs to 30 June 2014(1) Includes investment in loans to Value Retail(2) IRR is blended return from all VR investments

Total investment cost of £267m(1) to June 2014

Total investment cost €485m

Total investment cost £260m

Ungeared IRR21%(2)

since Dec 2012

Ungeared IRR14%

since Dec 2009

23% Profit on cost

Ungeared IRR22%

since Oct 2012

3

Highcross Value Retail / VIA On site developments Development pipeline

Acquisition of outstanding 40% ownership of a leading UK asset:

• Full asset management control

• £180m acquisition price

• Ungeared IRR of >8%, from a

Increase exposure to high-growth outlet shopping sector

• Investment in VIA Outlets

– £70m commitment in 2014 with two assets purchased

– Future acquisitions planned– IRR on investment >10%(1)

• £30m for VR extensions in UK

Near-term growth from on site projects:

• Development cost of £195m(2) over period to 2016

• Expected yield on cost:c.7%

Significant progress made on highly attractive opportunities:

• Development cost ofc.£1.6bn(2) from 2014 – 21

• Major schemes:

– Whitgift, Croydon– Brent Cross extension– The Goodsyard, London

Use of proceeds: attractive capital deployment opportunities

• Ungeared IRR of >8%, from a low risk asset • £30m for VR extensions in UK

and Ireland and investment in VR Shanghai

– The Goodsyard, London

[Picture to come from company]

70% of placing to immediate opportunities

(1) Expected ungeared IRR(2) Estimated costs to complete as at 30 June 2014 – see appendix

4

• Acquisition of outstanding 40% of Highcross, Leicester from JV partner(a) for £180m

• UK top 30 retail and leisure facility covering c.105,600 m2

• Highly attractive catchment area; ranking 9th largest nationally and expected to grow by 3.7%(b)

• Comprises: 3 department stores, 8 MSUs, 106 retail units, and 20 restaurants

Highcross - growth in prime UK shopping centres

restaurants

• Extension completed in 2008 and includes St Peter’s Square with attractive dining area and 12-screen multiplex cinema

• Passing rent of £27.8m(c) (100%) with upside opportunity

• Net Initial Yield of 5.5%; Nominal Equivalent Yield of 6.25%

• Annual footfall of 17.3m (2013)

• Weighted average unexpired lease term(c) of 7.9 years to first break, 12.7 years to lease expiry

• Closest comparable asset 28 miles away (Nottingham)

(a) BIS (Postal Services Act 2011) Company Ltd(b) Source: CBRE; growth rate 2013 to 2018(c) As at 30 June 2014 5

Highcross – acquisition rationale

Corporate strategy • Aligned with the Company's strategy of owning high-quality retail destinations in prime locations

• Increased exposure to UK consumer recovery

Attractive returns• >8% ungeared IRR on ‘known’ asset

• Immediately EPS accretive

Capital allocation to prime UK

shopping centres

• Acquisition builds scale in UK prime shopping centres

• Hammerson’s second largest UK shopping centre after the Bullring(1)shopping centres • Hammerson’s second largest UK shopping centre after the Bullring(1)

Off-markettransaction

• Interests in top 30 UK shopping centres are traded infrequently

• Purchased at a discount to DTZ June 2014 valuation

Good yield at low risk

• 5.5% Net Initial Yield/6.25% Nominal Equivalent Yield

Asset management opportunities

• Restructure the House of Fraser department store to drive footfall

• Upgrade East Mall environment and town centre entrance

• Introduce attractive new retailers to raise the site’s profile and reduce vacancy

• 100% ownership ensures returns are maximised

(1) By floor area

6

Value Retail has delivered exceptional returns and is a key growth driver for Hammerson

• Only UK listed REIT to have strategic exposure to the outlet centre space

• Increasing demand for sector exposure –trajectory of double-digit organic growth

Unique exposure to dynamic retail outlet sector VR’s contribution to NAV has quadrupled

1

2

4% 16%

VR = £114m VR = £688mJun 2014Dec 2009

VR Investments

Hammerson ex-VR

trajectory of double-digit organic growth delivered consistently

• High barriers to entry; deep relationships with the top luxury retail brands

• Value Retail relationship provides opportunities for wider collaboration

Superior productivity3

4

VR = £114m VR = £688mJun 2014Dec 2009

1. Proportions based on Hammerson EPRA equity shareholder funds of £2,960m (Dec 2009) and £4,365m (Jun 2014)2. VR investments are on EPRA basis and include shareholder loans

-

2,000

4,000

6,000

8,000

10,000

12,000

VR Europe UK Out of Town UK In Town

£/sq

m

(1) Hammerson estimate(2) CBRE sales densities

(2) (2)

Sales Densities 2013

(1)

7

VIA Outlets - New European outlet partnership

• Opportunity to increase Hammerson’s exposure to the fast-growing European outlet sector

– Partnership with Value Retail, APG and Meyer Bergman

– Targeting primarily existing European outlets centres with growth potential

– Focus on large catchment areas close to major cities with strong tourist appeal

– Leverage Value Retail’s extensive European platform and its relationships with retail brands

• Hammerson 47% economic interest, £70m committed for acquisitions before the end of 2014

– Initial acquisition of two assets: Batavia Stad, Amsterdam and Fashion Arena, Prague

– Series of further acquisition targets identified and have engaged with relevant owners

• Hammerson investment expected to generate ungeared IRR of >10%

8

Existing and planned VIA Outlets investments

Batavia Stad, Amsterdam Fashion Arena, Prague Pipeline of acquisitions

• European acquisition roadmap

established

One of only three factory outlets in the Netherlands

26,340 m2 scheme

108 retail units

The leading factory outlet in the Czech Republic

25,125 m2 scheme

104 retail units

• Engaged with targets’ owners

• Primarily locations close to major

/ capital cities with strong tourist

appeal

9

Accelerating Value Retail growth

• Hammerson £30m incremental investment

– Extensions at Value Retail villages in UK and Ireland expand diversity of retail / catering offer

(1) Source: European Travel Commission

– Improved transport infrastructure at Bicester

– Investment in new Value Retail village in Shanghai

10

Group forecast development expenditure

Les Terrasses du Port, Marseille

On site developments

Victoria Gate, Leeds

Jeu de Paume, Beauvais

Other on site developments

£m

Completed developments

Excludes Whitgift acquisitionsOther on site developments: Abbotsinch Retail Park, Paisley; Cyfarthfa Retail Park, Merthyr Tydfil; Silverburn, Glasgow; O’Parinor, ParisOther extensions/developments: Elliott’s Field Retail Park, Rugby; Brent Cross leisure extension30 June 2014 position as presented in 2014 Half Year results(1) Future developments – phasing and costs reflect 30 June 2014 estimates only (see Appendix)

Other on site developments

Future developments(1)

Other extensions/developments

Whitgift, Croydon

Brent Cross extension

Watermark WestQuay, Southampton

The Goodsyard

11

2014 development opportunities

Jeu de Paume, BeauvaisVictoria Gate, Leeds Watermark, WestQuay Elliott’s Field, Rugby

23,800 m2 shopping centre

86 shops and restaurants

50% pre-let(1)

Completion Q3 2015

Total development cost €85m

34,300m2 luxury retail venue

John Lewis anchor store

32% pre-let(1)

Completion Q3 2016

Total development cost £150m

17,000m2 leisure and catering scheme

Adjacent to jointly-owned WestQuay

45% pre-let(1)

Start on site Q4 2014, completion Q4 2016


16,000m2 retail park extension

Debehams and M&S anchor stores

42% pre-let(1)

Start on site Q4 2014, completion Q4 2015


(1) Let or in solicitors’ hands at 23 July 2014

12

Development pipeline

Brent Cross, LondonCroydon Town Centre The Goodsyard, London

90,000m2 extension to existing scheme

Potential start 2016

Section 106 signed

Future development cost £350m

200,000m2 regional shopping centre

Potential start 2015

Land assembly ongoing for CPO

Future development cost £500m

4.2 ha regeneration project

19,000m2 retail, 60,000m2 offices, 1,500 homes

Planning application submitted in July 2014

Phase I future development cost £140m

Note: Development costs reflect Hammerson’s share of future expenditure as at 30 June 2014

13

37.5%

40.1%

33.9%

40% LTV

35% LTV

Financial impact of acquisitions and placing

LTV as at 30 Jun 2014 LTV post acquisitions Effects of placing

• Capital recycling continues to be important – selective disposals to be pursued



Net debt (pro-forma)

£2,355m(1) £2,581m(2) £2,181m(4)

Property assets (pro-forma)

£6,277m(1) £6,440m(3) £6,440m(3)

(1) Actual position as at 30 June 2014(2) Reflects disposal of 10 Grosvenor Street (£54m), Highcross acquisition (£180m) and outlet sector investments (£100m)(3) Gross assets reflect the Highcross acquisition (£180m) and the disposal of 10 Grosvenor Street (£17m). Outlet sector investments are not included in the Group’s property assets(4) Assumes £400m proceeds 14

Summary

• Cash box placing of c.71m shares, equivalent to c.9.9% of ISC immediately prior to the transaction

• Favourable outlook for investment into UK retail property and European outlet markets

– £180m acquisition of the remaining 40% interest in Highcross, Leicester, a top 30 UK shopping centre. Unlevered IRR >8%, discount to

June NAV

– At least £100m to increase exposure to outlet shopping centres

– New venture, VIA Outlets, alongside Value Retail, APG and Meyer Bergman, targeting European outlet shopping centres with growth

(1) Estimated costs to complete of on site schemes at 30 June 2014

–

potential. Two acquisitions; total Hammerson expenditure of £70m by the end of 2014. Expected ungeared IRR >10%

– Incremental capital of £30m to Value Retail to assist with extensions at villages in the UK and Ireland and for the new Value Retail

village in Shanghai

– c.£120m to be invested into major development programme. £195m(1) of capital committed to on site schemes and significant

progress on development pipeline

• Disciplined evaluation of acquisition opportunities balanced by selective disposals



15

• Announcement date 25 September 2014

• Structure Cash box placing

• Size of issue 9.99% of issued share capital

Proposed Placing

• Bookrunners Deutsche Bank and JP Morgan Cazenove

• US restrictions Rule 144A (QIBs only)

• Proposed admission and settlement 30 September 2014

16

Appendices

17

Value Retail is Europe’s leading outlet shopping centre operator

La Vallée VillageLa Vallée Village

Bicester VillageLondon


Kildare VillageDublin


Maasmechelen VillageBrussels


Wertheim Village Frankfurt

Wertheim Village Frankfurt La Vallée Village




Wertheim Village Frankfurt

Batavia Stad, Amsterdam (VIA Outlets)

Fidenza VillageMilan


Las Rozas VillageMadrid


La Roca VillageBarcelona


La Vallée VillageParis


Frankfurt Frankfurt

Ingolstadt VillageMunich






Frankfurt


Fashion Arena, Prague (VIA Outlets)

18

Hammerson’s investment in Value Retail

Holding companiesHolding companies22% equity22% equity

Hammerson Hammerson €€58m 58m

shareholder shareholder loanloan

La ValléeVillage

MasmechlenVillage

FidenzaVillage

WertheimVillage

IngolstadtVillage

KildareVillage

Las RozasVillage

La RocaVillage

BicesterVillage

Village ownership Village ownership via LPs (%)via LPs (%) 33 23 19 11 13 20 31 0 3

Total Village Total Village ownership (%)ownership (%) 45 35 31 22 24 32 43 11 14

As at 30 June 2014

19

Value Retail growth drivers

• Increases in global tourism

– Chinese visits to Europe set to grow 72% until 2018(1)

– Repeat customers from Gulf States, South America and Russia

– A high proportion of sales from Bicester are to non-EU shoppers–

– Targeted promotions and travel partnerships

• Expansion of luxury brand retail platforms

– More inventory to recycle

– Upgrading retail experience in flagship units in Villages (Burberry, Gucci)

– Outlet channel supports brand profile (Prada)

(1) Source: European Travel Commission

20

Developments and extensions

SchemeOwnership

%Lettable area

m2 Earliest startPotential

completion

Value at 30/6/2014

£m

Estimated cost to complete(1)

£m

Estimated annual

income(2)

£m

Let(3)

%

On siteO’Parinor, Aulnay-sous-bois, Paris 25 7,200 Commenced Q4 2014 n/a 1 1 100Siverburn extension, Glasgow 50 10,900 Commenced Q1 2015 n/a 6 1 91Cyfarthfa Retail Park, Merthyr Tydfil 100 14,500 Commenced Q2 2015 n/a 16 2 38Jeu de Paume, Beauvais 100 23,800 Commenced Q3 2015 18 52 5 50Victoria Gate, Leeds (Phase 1) 100 34,300 Commenced Q3 2016 30 120 10 32

TOTAL 90,700 195 19Major developments (>30,000m2)The Goodsyard, London E1(4) 50 260,000 2016 Phased 140 -Whitgift, Croydon 50 200,000 2015 2018 500 35Brent Cross extension, London 41 90,000 2016 2019 350 26

TOTAL 550,000 990 61TOTAL 550,000 990 61

Extensions/developments

Elliott’s Field Retail Park, Rugby 100 16,000 2014 2015 35 3 42

Watermark WestQuay, Southampton 100 17,000 2014 2016 75 5 45

Brent Cross leisure, London 41 9,000 2016 2018 20 2

TOTAL 42,000 130 10

Pipeline

Italie Deux, Paris 100 5,000 2015 2017 25 2

SQY Ouest, Saint Quentin-en-Yvelines 50 31,700 2015 2016 11 2

Victoria Gate, Leeds (Phase 2) 100 73,000 2018 2021 480 40

TOTAL 109,700 516 44

792,400 1,831 134

Other than on site projects, the information above reflects estimates at 30 June 2014 and is subject to review as detailed project plans are advanced.(1) Incremental capital cost including capitalised interest(2) Incremental income net of head rents and after expiry of rent-free periods(3) Let or in solicitors’ hands by income at 23 July 2014(4) Cost reflects phase 1 only. Due to residential component of scheme, area is gross external and income is not applicable(5) € converted at £1=€1.249. Value, costs and income represent the Group’s share for joint ventures

21

432 478

248200

400

600

Disciplined use of shareholders’ capital

Hammerson net retail investments (£m)

Investment portfolio yields – 30 June 2014

UK Shopping centres 4.5%

FR Shopping centres 4.4%

Acquisitions/Disposals Development

248111

(99) (133) (58) (99)

(176)

(530)

(198) (54)

(800)

(600)

(400)

(200)

0

2011 2012 2013 2014 YTD

£m

Acquisitions Other disposals London office proceeds

UK Retail parks 5.5%

Development pipeline YOC target c.6.5-7.5%

Flexibility of investment options

22

Financing policies

Pro forma for acquisitions and

placing(1)

30 Jun 2014 31 Dec 2013

Net debt - £2,181m £2,355m £2,252m

Gearing <85% 46% 54% 56%

Loan to value <40% 34% 38% 38%

Healthy financing ratios

Cash/undrawn facilities - £1,154m £980m(2) £716m

Weighted average cost of finance - 4.6% 4.8%

Interest cover >2.0x 2.8x 2.8x

Net debt/EBITDA <10x 8.8x 8.2x

Fixed rate debt >50% 90%(2) 82%(3)

(1) 30 June 2014 position shown on a pro-forma basis post 10 Grosvenor Street disposal, Highcross and outlet sector investments and £400m share placing

(2) 30 June 2014 position shown on a pro-forma basis post EUR500m 8 year bond issue at 2.0% funded on 1 July 2014

(3) 31 December 2013 position shown on a pro-forma basis post $443m US private placement issue arranged in November 2013

23

Maturity profile of debt

30 June 2014 position as presented in 2014 Half Year results, shown on a pro-forma basis to include new bond issued on 1 July 2014 maturing in 2022, but without reflecting any repayment of bank debt from bond or net issue proceeds

24

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