Profits before tax for real estate firm British Land grew by 1.6 per cent year-on-year to £65 million, first quarter results published today reveal.
Demand for its retail properties remains strong, with UK occupancy up to 98.7 per cent, the estimated rental value (ERV) of its portfolio rose 0.4 per cent and secured new letting during the period came in at 4.3 per cent above ERV.
The three-month period ending June 30th 2011 saw the company’s UK retail sites grow 4.9 per cent in value year-on-year, with net equivalent yield for these locations up 5.7 per cent compared to the same period in 2010.
Chris Griggs, CEO of British Land, said: “We’ve had an active and positive start to the year. Our focus on high quality retail and London offices continues to drive strong valuation and improvement in rental values.
“The early decisions we made in undertaking our £1.1 billion development programme are having a real impact, accounting for nearly a quarter of our valuation improvement, and the highly selective acquisitions made since the beginning of the quarter will add both incremental income and value for our shareholders.”
Like all the major property companies British Land has focused its retail portfolio on the major centres around the UK which have proved far more resilient to the consumer downturn, nowhere more so than London.
Amongst the top performing properties in the British Land portfolio however are Teeside Shooping Park in Stockton-upon-Tees and Drake Circus Shopping Centre in Plymouth, which both currently have 100 per cent occupancy.
Other sites singled out in the results include the 1.38 million sq ft Meadowhall Shopping Centre in Sheffield and Hull’s 410,000 sq ft St Stephens Shopping Centre which recorded respective annualised contracted rents of £81 million and £8.1 million.
Tesco has remained British Land’s biggest lettings client with its supermarkets making up 7.2 per cent of overall rent taken by the firm, followed closely in the top ten by fellow retailers Sainsbury’s and Debenhams.