Land Securities Pushes Developments With Trinity Leeds Start

21st Jul 2010 07:18

By Anita Likus Of DOW JONES NEWSWIRES LONDON (Dow Jones)--The U.K.'s largest real estate investment trust, Land Securities Group PLC, (LAND.LN) Wednesday said it's progressing its GBP1 billion development pipeline, including restarting the Trinity Leeds development, amid improving property markets. Chief Executive Francis Salway said "our outlook and plan remain the same--a recovery in property values over the medium term, but interspersed by ripples. We see strong investor demand in some sub-markets, but early evidence of price resistance in others. We will continue to play any such imbalances to our advantage." The company confirmed it will restart the 750,000 square feet shopping center development at Trinity Leeds, having pre-let 43% of the space, which will cost GBP350 million to develop. The move is part of a wider strategy to grow Land Securities' retail portfolio revealed to Dow Jones in March. It's also progressing three developments in the West End and talking to possible joint venture partners to restarts its 20 Fenchurch 'Walkie Talkie' scheme. Land Securities achieved GBP4.6 million of development lettings in the first quarter with a further GBP3.8 million in solicitors' hands while vacant space fell to 5.7% from 5.9% at March 31. The vacancies include units let on a temporary basis at 1.1%. Units in administration also fell to 0.8% from 1.0% reported in March. U.K. landlords and developers have just come out of one of the worst downturns in decades, as a lack of finance following the credit crisis stifled demand for real estate and builders stopped developments. But just as property companies are ready to commit to new assets and developments, fears that the U.K.'s Autumn spending review could damp consumer confidence and spending appetite once more are threatening the fragile recovery in the property market. Capital values turned a corner in August last year, having fallen some 45% peak to trough, but growth is easing again, according to the Investment Property Database, which recorded a 0.5% increase in property values in June. Land Securities shares closed Tuesday at 581 pence giving it market capitalization of GBP4.43 billion. they have fallen 13% in the year to date on fears that U.K.'s recovering property market will take another hit. -By Anita Likus, Dow Jones Newswires; +44 20 7842 9407; [email protected] (END) Dow Jones Newswires July 21, 2010 02:18 ET (06:18 GMT)