British Land reports stable first-half performance

The FTSE 100 company said underlying earnings per share increased 1% to 15.3p, while dividends per share also grew by 1%, to 12.24p.

It said it achieved a total accounting return of 2.8% during the period.

Net tangible assets per share were also ahead 1% to 567p, while the firm’s proforma loan-to-value stood at 37.8%, and its debt profile remained secure with 97% of 2025 financial year debt interest hedged and £1.6bn in undrawn facilities and cash.

Recent capital activity included £456m in disposals, including the sale of Meadowhall, and £711m in retail park acquisitions at a blended net equivalent yield of 7%.

Operationally, British Land reported portfolio occupancy of 98%, with strong leasing performance across its focus sectors.

The company leased 1.7 million square feet during the period, achieving rents 8% ahead of estimated rental values (ERV).

Retail parks performed particularly well, with like-for-like rental growth of 2% and valuation growth of 5.1%, outpacing other sectors.

Portfolio valuations rose modestly by 0.2%, driven by gains in retail parks, although campuses and London urban logistics assets experienced slight declines.

Six-month ERV growth across the portfolio reached 2.5%, aligning with the company’s reiterated guidance of 3% to 5% annual growth.

British Land also highlighted sustainability achievements, receiving a five-star GRESB rating and improving energy efficiency across its portfolio, with 64% of properties now rated EPC A or B, up from 58% at year-end.

Looking ahead, British Land said it expected 2025 underlying earnings per share to reach 28.1p, reflecting the accretive impact of its retail park acquisitions and recent equity placing.

The company said it remained focussed on its conviction sectors, including campuses, retail parks and urban logistics, with significant leasing opportunities in the pipeline.

“We are pleased the operational and financial momentum in our business continues,” said chief executive officer Simon Carter.

“Strong levels of leasing ahead of ERV and sustained cost discipline enabled us to grow profits again, despite significant development activity, which will be a key driver of future profit growth.

“Our values were up 0.2%, with a particularly strong performance in retail parks offsetting residual yield movement in campuses.”

Carter said that since April, the firm had disposed of £456m of non-core assets and rapidly deployed £711m into retail parks, one of its preferred subsectors, given their “attractive” occupational fundamentals and high occupancy.

“Since 2021 we have increased our exposure to retail parks from 15% of the portfolio to 32% today.

“This conviction is paying off, with retailers competing for cost-efficient out-of-town space to support their online operations.

“This is leading to strong rental growth and valuation uplifts which are outperforming all other subsectors.”

Similarly, Simon Carter said the “super prime space” the firm was developing on its campuses was benefiting from a “significant imbalance” between the demand and supply for new and substantially refurbished space, particularly in the City, where it estimated a shortfall of five million square feet over the next four years.

“This is leading to strong rental growth at the top end of the market.

“While geopolitical risk remains elevated and there has been some volatility around the recent Budget and US election, British Land's portfolio is well positioned for the inflection in the cycle.

“The continued strength of our occupational markets, underpins our guidance of 3% to 5% rental growth across the portfolio, and our ability to generate attractive future returns.”

At 0831 GMT, shares in British Land Company were down 2.44% at 375.2p.

Reporting by Josh White for Sharecast.com.