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British Land Co PLC on Wednesday posted a swing to profit in its recent financial year, as the commercial property market recovered from the hit of the pandemic.
At the conclusion of the year that ended March 31, the London-based property development and investment company said EPRA net tangible assets per share stood at 727 pence, up 12% year-on-year from 648p.
Net asset value per share grew 13% to 722p from 641p, as the value of its portfolio rose 6.8% to £6.73 billion.
The property firm swung to a pretax profit of £958 million from a loss of £1.05 billion the year before. Revenue fell by 12% to £410 million from £468 million.
‘Operationally, our leasing volumes across Campuses and Retail & Fulfilment were the highest in ten years and were ahead of estimated rental value. In London, demand continues to gravitate towards the best, most sustainable space where our Campuses are at a distinct advantage,’ commented Chief Executive Officer Simon Carter.
Whilst Retail leasing volumes were strong, the overall transactions were 21% below previous passing rent as the firm prioritised having strong occupancy rates.
Looking ahead, British Land expects strong demand for its Campus developments to continue, and said the overall market trends are positive. It noted construction cost inflation is likely to be between 8% and 10% this year, but will moderate to 4% to 5% over the next 18 months.
‘Higher land values mean that returns from London development are more insulated to cost inflation than development in other parts of the country and we anticipate being able to achieve the modest increase in rents needed to offset any further cost inflation above our base case,’ the firm noted.
The board proposed a dividend of 11.60p, which would bring the full-year total to 21.92p, 46% higher than 15.04p the year before.
Shares in British Land were 0.8% higher at 510.40 pence each in London on Wednesday morning.
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