British Land to reveal conditions of London property market

David Cowan
Inside The City Of London's New Landmark Skyscraper
British Land sold the Cheesegrater this year for $1.5bn (Source: Getty)

First-half results from the property development company British Land will be unveiled this week, giving a significant look at the London property market amid Brexit uncertainty.

Key details to be published include the occupancy rate and average lease length, which stood at 98 per cent and 8.3 years in the last financial year. These are indicators of how strong demand in the market has been in recent months.

Read more: London's commercial property market outlook plagued by downturn jitters

The net asset value (NAV) per share figure will be an important indicator of British Land’s profitability, alongside the estimated rental value (ERV) which measures leasing activity. Analysts say these figures will help establish how confident the market has been over the past year.

Hargreaves Lansdown analyst Danny Cox said: "The group argued there was strong demand for its assets, but limited opportunity for reinvestment at attractive values.

"With the company’s own shares trading at a discount to net asset value, it considered buying them back to be the most attractive option for investors. Given that fairly pessimistic outlook, the group’s commentary on Brexit and market conditions will be watched with interest."

Read more: Commercial property investment in the City set for a record year

Property giants like British Land have been facing growing uncertainty over the course of 2017. This has been caused by poor performances, uncertainty over Brexit, and challenges from an emerging proptech sector, including new companies such as WeWork.

British Land announced a £300m share buyback earlier this year due to a lack of investment opportunities. In March, British Land and its joint venture partner Oxford Properties sold the “Cheesegrater”, the tallest building in the City of London, to a China's CC Land for £1.15bn.

Read more: The Cheesegrater's new owner wants to buy more "iconic" London skyscrapers

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