Commercial Finance Specialists

British Land’s results for six-months to 30th September 2011 show the company to still be growing despite a struggling economy and real estate market.

The property developments are taking place on all three of their major London office sites, with development values rising by a considerable 15.2%.

Regent's Place in London’s West End has a 14,000 sq. metre let to Debenhams who pay £50-£53.50 per sq. ft. The Leadenhall Building, often known as the ‘Cheesegrater’ because of its distinct design, accrues rent of £56.60 per sq. ft from Aon. The new 700,000 sq. ft UBS building at Broadgate is taking £54.50 per sq. ft.

These pre-lets have added £32 million to British Land's rent roll over a 20-year period. The total spending on main developments is £1.9 billion, with 90% of that directed towards the central London projects, which, once fully let, should let for £128 million.

The duality of the real estate rental market is reflected by British Land’s figures for retail and office rents. Values for commercial retail property have only risen by 0.7% compared to 5.3% for its office portfolio.

In total the IFRS net assets that the company owns has increased by 12.6% in value, from £4.43 billion in the first half of 2010 to £5.06 billion in the first half of 2011, with shares rising to 591 pence per share today.

Gross profits have seen less substantial increases, rising by £5 million over the same period to £132 million. Hence, dividends remain unchanged at 13 pence per share.

Shares have fluctuated recently, falling from a peak of 510p per share on 14th November to 468p currently.