British Land net assets leap 27%

18th May 2010 07:03

British Land had a "good" year despite the challenging and volatile markets, lifting net asset value (NAV) by 27%, more than many analysts had predicted. The real estate giant revealed net asset value per share at 31 March 2010 was 504p, while the portfolio valuation grew 13.5%, reflecting a greater weighting in prime out-of-town retail and London office assets which generate strong and growing income flows. The difference between the two numbers was down to gearing.Underlying profit before tax for the year to 31 March, down 7% to £249m, was hit by disposals and development completions.But there was an IFRS profit before tax of £1.13bn this time compared with a £3.93bn loss a year ago thanks to a £496m revaluation increase compared with a £3.24bn reduction last time."We have entered the new financial year with greater optimism and are particularly encouraged by the recent strengthening of the London office occupier market," the firm said, although it acknowledges that the economic recovery remains fragile, so will "continue to act with caution" during the current year.Given the rapid rise in capital values during the second half of the last financial year, the company expects overall real estate performance in 2011 to be relatively muted, although rental values, which began to rise in the fourth quarter, are expected to continue to rise over the next year."We are well positioned as we emerge from the challenges of the last year and look forward to the opportunities that lie ahead," said chairman Chris Gibson-Smith.