British Land retail property portfolio haemorrhages tenth of value

The landlord reported that its retail property portfolio shed nearly £600m in value in the six months to September, as the ongoing travails facing the high street took its toll.

The value of British Land’s shopping centres, retail parks and stores fell 10.7% to £4.8bn, which dragged the business to a pre-tax loss of £440m, a £42m loss on the same period a year earlier.

British Land, which owns shopping centres such as Sheffield’s Meadowhall, sold £236m of retail assets during the period, including £194m worth of Sainsbury’s supermarkets.

It said two-thirds of stores vacancies, which have resulted following retail CVAs or administrations since April 2017 are “either re-let, under offer or in negotiations”.

British Land chief executive Chris Grigg said: “Looking forward, we expect our markets to remain uneven, but we have kept debt levels low, our balance sheet is strong and flexible, and we have a broad spread of expertise across our business.

“We expect retail to remain challenging, so we’ll focus on driving operational performance and maintaining occupancy. We see early signs that some liquidity may be returning to parts of the market, and our focus will remain on thoughtfully progressing our strategy to reduce exposure.”

Grigg also noted that British Land expects the London market “to remain good” and noted that the landlord had seen a 0.4% uptick in the value of its office portfolio during the period.

Landsec also recorded a drop in retail portfolio value this week, with values dropping 2.8%, or £368m.