British Land occupancy rates improve

16th Nov 2010 07:28

Big employers looking for swanky new offices in central London have pushed occupancy rates at real estate giant British Land higher during the first half and net asset value is up over 4%.The company, which recently revived its "Cheesegrater" project in the City and has signed up UBS for its Bishopsgate redevelopment, reported an increase in the portfolio occupancy rate from 96.6% in March to 98% at the end of September after agreeing over 600,000 sq ft of new lettings during the period. That meant rental value growth of 4.2% across the London office portfolio.A 2.6% rise in the value of the portfolio to £8.9bn "modestly" outperformed the benchmark thanks to office lettings and a portfolio weighting toward prime London office and retail.Net asset value (NAV) has improved to 525p from 504p at the end of March.Underlying profit before tax for the six months to 30 September was £127m, down from £128m a year ago, but up 12.4% excluding a £16m credit provision release in 2009."Looking forward, we expect to be able to exploit the growing demand supply imbalance in London offices and to benefit from a growing need from a significant number of retailers to take new space in the best locations," the property giant said."However, we remain vigilant with respect to the impact of next year's VAT increase and Government spending cuts."The second quarter dividend is kept at 6.5p a share.