British Land sees property levelling off

4th Aug 2010 08:00

The recovery in property values has slowed in recent months, British Land said today, though investment for prime office and retail properties remains strong. Rental growth in the London office market has been good in the last six months and should continue at a more modest rate with lower levels of activity, the firm said. Rental values are up 2.4% over the 3 months. Retail faces more pressure on rental levels but British Land expects its properties to do much better than secondary locations where the supply/demand tension remains weak. Retail values were ahead by 0.9%. Occupancy increased by 1.2% to 97.8% with around 400,000 sq ft of new lettings signed or put under offer since March. In July, the group also re-let two blocks in Broadgate in the City to UBS.NAV rose to 515p at end June from 504p at end March. Underlying profit before tax in the quarter rose slightly to £64m with like-for-like income up 1.9% year-on-year. The portfolio rose by 1.4% on the prior quarter at £8.7bn. The quarterly dividend is being maintained at 6.5p.