British Land's NAV drops on weakness in retail sector
(Adds details on earnings, background, shares)
Nov 14 (Reuters) - Real estate firm British Land Co
reported a 2.9 percent drop in net asset value for the first
half of the year on Wednesday, as retailers invest less in
physical stores amid increased online competition.
Many retail firms are shutting down stores to cut costs and
focus on the online space, dealing a blow to real estate firms
that get a large chunk of their business from retailers.
The company's EPRA net asset value, a key industry metric
that reflects the value of a firm's buildings, was 939 pence per
share, down from 967 pence per share in the six-month period
ended March 31. It was, however, up 4.2 percent from a year
"We expect retail to remain challenging in both the occupier
and investment markets as the impact of long-term structural
change is compounded by short-term headwinds," the company said
in a statement.
British Land, which counts Marks and Spencer, Tesco
and IKEA as tenants, added its office business was
doing well but the company remained "alert to potential
uncertainties as the Brexit process unfolds."
Demand for new office space in London will continue even
with the imminent exit of UK from the European Union, a closely
watched industry survey showed on Tuesday.
British Land, one of UK's largest listed property
developers, has office properties including upscale addresses
such as Regent's Place and Broadgate.
The company's underlying profit fell to 169 million pounds
($220 million) from 198 million pounds a year earlier.
Rival Land Securities Group Plc on Tuesday reported
lower net asset value per share in the first-half, also hit by
challenges in the retail sector.
Up to Tuesday's close of 620 pence, shares of the company
have fallen 10.3 percent this year.
($1 = 0.7693 pounds)
(Reporting by Pushkala Aripaka and Noor Zainab Hussain in
Editing by Saumyadeb Chakrabarty)
First Published: 2018-11-14 09:16:23
Updated 2018-11-14 10:00:28
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