MORE than £1 billion has been wiped off the value of the assets of British Land, the company until recently run by new Royal Bank of Scotland chief executive Stephen Hester.
However, figures released yesterday showed that despite the decline of more than 10 per cent in British Land's asset values, the company's properties remain almost fully occupied.
The retail, office and business park developer revealed yesterday
that the value of its portfolio, including joint ventures, sank by 10.8 per cent to £11.6bn in the six months to 30 September.
The company also posted a pre-tax loss of £1.33bn, although excluding valuation write-downs the six-month result was a pre-tax profit of £144 million.
It said that, with recession inevitable, more corporate occupiers and retailers were taking space in the firm's "landmark" shopping centres and office towers, while existing residents were paying higher rents for their premises.
Chairman Chris Gibson-Smith said: "We offer resilience in an otherwise uncertain market.
"Over the past few years we have reshaped our portfolio to focus on prime property … Our average lease lengths are 13 years, with only 4 per cent up for renewal in the next three years."
British Land, which owns the Meadowhall shopping centre in Sheffield and most of the Broadgate Estate office complex in the City of London, said its portfolio remained 97 per cent let. It achieved more than 900,000 square feet of lettings in the half-year.
It also unveiled that like-for-like rental income was 4.2 per cent higher than in the same period of 2007, beating industry benchmarks of 3.5 per cent growth.
The company said it had provisionally let over a quarter of the office space at its 593,000sq ft Ropemaker Place office development, which is due to be completed in 2009.
British Land said its other key London City projects at Broadgate Tower and 201 Bishopsgate were more than 75 percent let but it had curtailed its office development programme to 1.1 million sq ft and its Leadenhall skyscraper project remained on hold.
Finance Director Graham Roberts said tenants representing less than 0.6 per cent of British Land's total annual rent roll had defaulted over the six months, although the level could rise in the new year.
British Land's hunt for a replacement for Hester – who joined RBS last month and will take over formally from Sir Fred Goodwin tomorrow – was progressing well, Gibson-Smith said.
"The opportunity to become the CEO of a FTSE 100 company is something people will do a lot for, so we're not short of interest," said Gibson-Smith, adding that he hoped to name Hester's successor before Christmas.
