British Land benefits from out-of-town bias
Published: 09 February, 2010
British Land unveiled a strong set of third-quarter results, driven in part by the revival in the out-of-town retail market.
Britain's second-largest Real Estate Investment Trust, and largest manager of retail parks, saw the value of its retail holdings soar by 8.4 per cent in value during the three months to 31 January 2009 with retail warehouses, superstores and department stores performing particularly strongly, reflecting the depth of investor appetite for the retail sector. But retail rental values continued to decline, falling by 0.5 per cent in the quarter.
Chief executive Chris Grigg said: “In the quarter we completed a total of 282,000 sq ft of lettings and renewals within our retail warehouse and shopping centre portfolios. At Meadowhall, we have exchanged some 48,000 sq ft of lettings bringing in new retailers such as Aldo, Cult, Firetrap, Lipsy and Office.” As a result the BL retail portfolio is 99 per cent let.
BL's quarterly valuation highlighted the rapid yield shift in the retail sector with retail warehouse and department store yields both moving in 62bp over the quarter. Food superstores appreciating by 43bp and shopping centres by 16bp.
