Last updated 11:36, Friday, 02 May 2008

REAL estate group Hammerson painted a gloomy picture of its UK market today after revealing further falls in property values and an easing in City of London rents as banks cut staff numbers because of the credit crunch.

The firm, which owns shopping centres including Brent Cross and WestQuay in Southampton, said retailers faced weak conditions, but added it continued to attract firms to major developments in Bristol and Leicester, both of which complete later this year. It said the vacancy rate within its shopping centre and retail park portfolios remained low at 2.6 per cent.

Hammerson added that demand for retail space in France, which accounts for nearly 30 per cent of its portfolio, was “healthy”, although the French office market softened in the first three months of the year.