Broker snap: British Land continues strong growth

15th Feb 2011 14:03

British Land continued to enjoy its period of continued outperformance at the end of 2010 driven by both income and capital growth, according to broker Panmure Gordon.The real estate investment trust reported a third quarter (Nov - Dec) pre-tax profit of £64m, slightly below the broker's estimate of £65.7m, while its net asset value was 548p, beating expectations of 532p.The company saw further improvement in retail rents with estimated rental values (ERV) up by 0.4%, while ERV growth in its office portfolio continued in the period with a 1.4% increase overall in its London office."The company's 1,000,000 sq ft developments [in office] that were completed in 2009/10 are now over 95% let, and it has over 2,200,000 sq ft of developments in its current programme - an important bull point given the supply:demand imbalance in office," the broker says.With an attractive 4.8% dividend yield - the highest in the broker's coverage universe - Panmure retains its 'buy' and ups the target price to 555p, from 548p.