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British Land posts first annual profit since 2018 amid recovery in occupancy

Jeremy Lim
18 May 2022

British Land has posted its first annual profit after three consecutive years of losses, following a recovery in occupancy at its office and retail spaces with the easing of COVID-19 restrictions.

The FTSE 100 group swung from a pre-tax loss of £1.1 billion last year to a pre-tax profit of £960 million for the 12 months ending 31 March 2022, with people gradually return to cities and workplaces.

British Land's £2.2 billion capital activity includes £694 million from the sale of 75% of majority of assets at Paddington Central to GIC and £290 million from the sale of 50% of its share in the Canada Water Masterplan to AustralianSuper.

The company also reported that its portfolio value increased in value by 6.8% to £10.46 billion with retail parks up 20.7%, following a £350 million investments in retail parks, which includes Crown Wharf in Walsall and Queens in Stafford.

Simon Carter, CEO of British Land said: "Over the past year we have delivered a strong performance across all parts of our business as we continue to execute against our strategy. Our total accounting return for the year was 14.8% driven by a 6.8% increase in the valuation of our portfolio and Underlying Profit is up 24.9%. Our balance sheet remains strong with pro forma loan to value of 28.4%.

"Operationally, our leasing volumes across Campuses and Retail & Fulfilment were the highest in ten years and were ahead of ERV. In London, demand continues to gravitate towards the best, most sustainable space where our Campuses are at a distinct advantage. Retail Parks are an attractive, cost-effective format for our retail customers reflected in our very low vacancy of 2.6%, so we are particularly pleased with our decision to allocate capital to this segment, where valuations have increased 20.7%.

"The fundamentals of Urban Logistics in London are compelling given the chronic shortage of space. We have made a good start to building our Urban Logistics business where we have assembled a c.£1.3bn development pipeline in 12 months."

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