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British Land slips to £42m loss as focus shifts to housing

British Land has written down the value of its retail assets by £14.5m due to a challenging market as it posted a half-year loss.

The developer announced an pre-tax loss of £42m for the six months to 30 September, down from a pre-tax profit of £238m in the same period of 2017.

The value of its portfolio as of 30 September was down £393m – or 1.9 per cent – from 31 March.

The developer said it intended to pursue private rented sector (PRS) schemes and had identified opportunities for 4,000-5,000 new units across its portfolio, including the Canada Water site.

This comes a day after Landsec announced plans to build 4,000 homes.

In its half-year results, British Land said its overall development pipeline had grown to 1.6m sq ft as of 30 September, up from 1.5m sq ft a year earlier, with the near-term pipeline standing at 440,000 sq ft.

The company said it will press ahead with plans for a hotel in Paddington as well as a mixed-use scheme in Blossom Street in Shoreditch.

In a statement, British Land said: “In line with our strategic focus on expanding the mix of uses at our campuses, our plans at Paddington Central include the Gateway, a 105,000 sq ft premium hotel. We are currently assessing our options in relation to this opportunity.

“At Blossom Street we have consent for a 335,000 sq ft mixed-use development, integrating 258,000 sq ft of office space, alongside retail and residential, to create a mixed-use development that builds on the historic fabric of the area.”

Its longer-term development pipeline will see British Land explore options at its Broadgate site, where it has consent for a 563,000 sq ft scheme at Finsbury Avenue that would add 374,000 sq ft to existing space.

The developer plans to expand its scheme at Paddington central due to new opportunities presented by Crossrail.

British Land announced that it will submit plans for a 371,000 sq ft development on a site that already has consent for a 240,000 sq ft scheme at 5 Kingdom Street.

Chief executive Chris Grigg (pictured) said: “This has been another period of good operational and strategic progress.

“Our London office developments are letting up ahead of schedule and on better terms than expected.

“Looking forward, demand for the highest quality London office space is expected to continue, but we remain alert to potential uncertainties as the Brexit process unfolds.

“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.”

Yesterday Landsec outlined £3bn of development it was looking to progress after March next year.

The developer’s chief executive Robert Noel said that it had drawn up £2bn of office-led developments, and a mixed-use development of £1bn.

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