British Land Co PLC BLND Half Yearly Report - Part 1

  British Land Co PLC (BLND) - Half Yearly Report - Part 1

RNS Number : 5104R
British Land Co PLC
20 November 2012



            Continued Outperformance Driven by Management Actions

Good results in tough markets; continued outperformance vs IPD

· Net rental income 1.1% ahead; UK like for like growth +1.2%

· Underlying PBT^1 up 3.8% to £137 million; IFRS PBT of £109 million  (HY 
2011/12: £331 million)

· Portfolio valuation  in line with  31 March 2012  at £10.4 billion  (UK 

· Continued outperformance  vs IPD  benchmarks: total  returns +170  bps; 
capital returns +200 bps

· EPRA NAV^1  ahead at 596  pence, +0.8% increase  over 12 months;  +0.2% 
over 6 months

· IFRS Net Assets flat at £5.1 billion (HY 2011/12: £5.1 billion)

· Quarterly dividend of 6.6 pence;  bringing the half year to 13.2  pence 

Good leasing activity  in slow  market reflects portfolio  strength and  asset 
management expertise

· Outperforming the market on all key operational metrics

· 953,000sqft of lettings and  lease renewals/extensions at 4.5%  above 
ERV; occupancy maintained at high levels (like-for-like UK 98.3%)

· Rental value growth at +0.3% outperforming IPD benchmark by 40 bps

· UK retail footfall +0.3% outperforming Experian benchmark by 300 bps

Successfully crystallising value from office developments

· 6.9% increase in value of committed office developments

· 54,000 sq ft of pre-lets agreed since 1 April: 56% of office  programme 
now pre-let

· Further 34,400 sq ft of space under offer post half year end

· £216 million of profit (24 pence per share) crystallised to date on the

· £175  million of  profit yet  to come  (19 pence  per share)  based  on 
valuers' current estimates

Disposals release capital to invest in future growth and replenish development

·  £351million  of  disposals  (£235  million  BL  share)  exchanged  or 
completed; 3.1% ahead of March 2012 valuation

· £316  million of  acquisitions  (£274 million  BL share)  exchanged  or 
completed since 1 April 2012: focused on replenishing development pipeline

· Acquisitions include:  Clarges Estate  (£130million), a  191,000sqft 
office/residential development opportunity in Mayfair and a retail development
in Hereford (£90 million forward funding)

Continued access to diverse range of low cost financing

· Achieved £917million (BL share  £703 million) of new financings  since 
the beginning of the financial  year; successful convertible bond issue:  £400 
million raised with a coupon of 1.5%

· Proportionally consolidated loan  to value (LTV)  at 46.0% (March  2012 

Chris Grigg,  Chief Executive  said:  "Today we're  reporting  a good  set  of 
numbers in what continues to  be a tough market.  Our income, profits and  NAV 
are up on the same period last year and we have continued to outperform the UK
property market on all key metrics - rental growth, capital returns and  total 
returns. Our results underline the  strength and resilience of British  Land's 
business. The decisions we have taken in recent years are ensuring we are  not 
only delivering  good results  today but  are also  building growth  into  our 
portfolio for the future."

Income statement metrics                H1 2012/13        H1 2011/12 Change
Underlying profit before tax^1      £137m    £132m  +3.8%
IFRS profit before tax              £109m    £331m
Diluted Underlying EPS            15.2p  14.6p  +4.1%
Diluted EPS                       12.5p  37.2p
Dividend per share                13.2p  13.0p
Balance sheet metrics                   H1 2012/13        YE 2011/12 Change
Portfolio at valuation               £10,388m     £10,337m 0.0%^2
EPRA Net Asset Value^1 per share  596p  595p  +0.2%
IFRS net assets                     £5,077m    £5,104m
Loan to value ratio                          46.0%             45.3%

^1 See Note 2 to the condensed set of financial statements

^2 Valuation movement during the period (after taking account of capital
expenditure) of properties held at the balance sheet date, purchases and sales

Investor Presentation

A presentation of the results will take place 9:30 am today, 20 November 2012,
and will be  broadcast live via  webcast ( and  conference 
call. The details for the conference call are as follows:

UK Toll Free Number: 0800 279 4841

UK Number:    +44  207  7136 

Passcode:  6438141

A dial in replay will be available later in the day and the details are:

Replay number:    +44  207  7111 

Passcode:   6438141

For Information Contact

Investor Relations

Sally Jones, British Land  020 7467 2942


Pip Wood, British Land 020 7467 2838

Gordon Simpson, Finsbury Group 020 7251 3801

Guy Lamming, Finsbury Group

Forward-Looking Statements

This document contains certain "forward-looking" statements reflecting,  among 
other things, current views on our markets, activities and prospects. By their
nature, forward-looking statements involve  risk and uncertainty because  they 
relate to future events and circumstances that may or may not occur and  which 
may be beyond British Land's ability  to control or predict (such as  changing 
political, economic or market circumstances). Actual outcomes and results  may 
differ materially from any  outcomes or results expressed  or implied by  such 
forward-looking statements.  Any  forward-looking  statements made  by  or  on 
behalf of  British Land  speak  only as  of  the date  they  are made  and  no 
representation or warranty is given in relation to them, including as to their
completeness or accuracy or the basis  on which they were prepared. Except  to 
the extent  required by  law, British  Land does  not undertake  to update  or 
revise forward-looking statements  to reflect  any changes  in British  Land's 
expectations with  regard  thereto  or any  changes  in  information,  events, 
conditions or circumstances on which any such statement is based.

Notes to Editors:

About British Land

British Land is one of Europe's largest Real Estate Investment Trusts  (REITs) 
with total assets,  owned or  managed, of  £16.3 billion  (British Land  share 
£10.4 billion),  as valued  at 30  September 2012.  Through our  property  and 
finance expertise we  attract experienced  partners to  create properties  and 
environments which are home to over 1,000 different organisations and  visited 
by over 300  million people each  year. Our property  portfolio is focused  on 
prime retail locations and Central  London offices which attract high  quality 
occupiers committed to long  leases. Our occupancy rate  of 97.3% and  average 
lease length to first break of 11.1  years are among the highest of the  major 

Retail assets account for 60% of our portfolio with around 28million sq ft of
retail space across 82retail  parks, 92superstores, 13shopping centres  and 
9department stores. The retail portfolio  is modern, flexible and  adaptable 
to a wide  range of  formats and our  active asset  management delivers  space 
which is attractive and meets the needs of both retailers and consumers.  80% 
of our retail parks have open A1 consent.

London offices,  located  in  the City  and  West  End, comprise  35%  of  the 
portfolio (which  will rise  to  an estimated  40%  on completion  of  current 
developments).  Our  7  million  sq  ft  of  high  quality  offices  includes 
Broadgate, the premier City  office campus (50% share)  and Regent's Place  in 
the West End. Over the last 2 years, we have committed £1.2billion to create
Central London's  largest committed  office development  programme which  will 
deliver  2.3millionsqft  of  high  quality  space  by  2014,  including   a 
700,000sqft building at 5Broadgate,  the 610,000sqft Leadenhall  Building 
in  London's  insurance  district  and   a  500,000sqft  mixed  office   and 
residential scheme at Regent's Place in the West End.

Managing our environmental, economic and social impacts is central to the  way 
we do business and deliver value  for our shareholders. We assess the  issues 
that matter most to us  and our stakeholders on  an on-going basis and,  where 
appropriate, adjust our strategic focus to reflect this. We focus on managing
our buildings  efficiently,  supporting  communities,  developing  sustainable 
buildings and  engaging  our staff.  For  each  of these  priorities  we  are 
targeting our efforts and  resources at initiatives where  we can achieve  the 
biggest impacts.

Further  details   can   be   found   on   the   British   Land   website   at

                           CHIEF EXECUTIVE'S REVIEW

We are reporting another good set of numbers in a tough economic  environment: 
income, profit and NAV were ahead and we significantly outperformed the market
on all key measures including total and capital returns which were 170 bps and
200 bps ahead  of the IPD  benchmark respectively. In  a market where  leasing 
activity has been generally slow and valuations have continued to weaken,  our 
results underline the strength and resilience of our business and the  actions 
we have taken in recent years to drive performance.

The results show the benefits of our  scale; our focus on high quality  retail 
in the UK and Central London  offices; our focus on strengthening and  growing 
rental income through asset management and acquisitions; our early  investment 
in a significant development programme  in Central London; our ongoing  access 
to low  cost funding;  and our  ability to  secure attractive  new  investment 

The valuation of  the group's portfolio  at £10.4 billion,  was flat over  the 
half, with a 0.2% increase in our  UK portfolio offset by Europe where  values 
were lower. Our decision to invest in a major development programme has been a
significant contributor to  our performance  and we  continued to  crystallise 
profits from our committed  office developments (value  +6.9%). To date,  this 
programme has generated  £216 million of  profit (24 pence  per share) with  a 
further £175 million (19 pence per  share) to come, based on valuers'  current 

Asset management is a core strength  of British Land which, combined with  the 
quality of our properties, means we continued to let space ahead of  estimated 
rental value  and  kept  our  portfolio almost  fully  occupied.  All  of  the 
operating metrics  within our  investment  portfolio remain  strong -  and  we 
continued to outperform the overall UK  market: on rental values (ERV  +0.3%); 
occupancy (like-for-like  98.3%); lease  length (11.1  years); rents  expiring 
over the next three years (9.1%) and in retail, footfall (+0.3%, 300 bps ahead
of the Experian benchmark). Leasing activity  in the half added £5.9  million 
of new rent on a net effective basis with lettings, lease extensions and lease
renewals signed at 4.5% ahead of ERV.

We were particularly pleased to sign  a new long-term joint venture  agreement 
at Meadowhall,  our large  super-regional shopping  centre, with  Norges  Bank 
Investment Management ("Norges"), one of the largest sovereign wealth funds in
the world. Meadowhall has performed strongly in recent years, benefiting from
a targeted programme  to attract a  broader range of  shoppers to the  centre, 
extend its catchment area and increase dwell time. We look forward to  working 
with Norges to continue to grow and develop Meadowhall.

Investor demand for  secure, income  generating assets remains  strong and  we 
sold a  number of  our more  mature  assets. We  completed or  exchanged  £351 
million (BL share £235 million) of disposals in the half at a 3.1% premium  to 
valuation. We  reinvested the  capital in  acquisitions (£316  million  gross, 
£274m BL share, exchanged or completed  since 1 April), the majority of  which 
have significant current or  future development potential, further  increasing 
our prospective pipeline. These included:  the Clarges Estate, a prime  mixed 
office and residential development site in the heart of Mayfair; Eden Walk,  a 
shopping centre in an  affluent and underserved market  in south west  London; 
and a £90 million forward funding of a retail development in Hereford. 

Our ability to  continue to access  low cost flexible  finance from a  diverse 
range of sources is a key  competitive advantage. Since the beginning of  the 
financial year, we have arranged £917 million of new financings (BL share £703
million) bringing the total new finance  raised over the last eighteen  months 
to £2.5 billion,  equivalent to nearly  one third  of the total  debt book  we 
manage. New financings in  the half included a  £400 million convertible  bond 
with a five year term and highly attractive coupon of 1.5% where we  benefited 
from being the first European real estate company to access this market  after 
the summer.

Board Change

In October,  it was  announced that  Steve Smith,  currently Chief  Investment 
Officer and an executive Board director, would be standing down from the Board
at the end of the  financial year (31 March 2013)  and leaving the company  in 

Today, we  are  announcing  that  the Chairman,  Chris  Gibson-Smith  will  be 
stepping down from the Board on 31  December 2012 on conclusion of his  second 
three-year term as  Chairman. He will  be succeeded with  effect on 1  January 
2013, by  John  Gildersleeve,  who  joined British  Land  as  a  Non-executive 
Director in 2008 and is currently Senior Independent Director.


British Land  continues to  be  well placed.  We are  executing  successfully 
against a clear strategy and as a  result continue to deliver good results  in 
tough markets as well  as buildgrowth into the  business for the future.  We 
expect market trends to continue to favour our business mix: we believe London
will remain highly  attractive to occupiers  and investors; polarisation  will 
continue, particularly  in Retail;  and  with debt  funding in  short  supply, 
development returns will remain attractive. We still have significant profits
to  come  from  our  committed  development  programme  and  are  successfully 
redeploying capital  into replenishing  our pipeline.  So although  we  remain 
cautious about the overall economic environment and expect property values  in 
the UK  to  be variable  in  the near  term,  British Land  remains  not  only 
defensive in today's more challenging  environment but also increasingly  well 
positioned to deliver in the future as the economy improves.

Chris Grigg

Chief Executive

                               BUSINESS REVIEW


The performance  of the  portfolio  has been  resilient  in a  tough  economic 
environment, with our overall valuation unchanged over the half year and total
and capital returns both  significantly ahead of  IPD at 170  bps and 200  bps 
respectively. We continued to  benefit from our focus  on prime UK retail  and 
Central London offices alongside our successful development programme.

Total Property Return (as calculated by IPD excluding Europe)
6 mths to 30 September        Retail              Offices           Total
%                       British Land    IPD British Land    IPD British    IPD
Income Return                    2.8    2.9          1.9    2.6     2.5    2.8
Capital Return                 (1.0)  (2.3)          2.3  (1.0)     0.3  (1.7)
- ERV Growth                    0.0  (0.3)          1.0    0.5     0.3  (0.1)
- Yield Movement Out^1        6 bps 14 bps        1 bps 24 bps   4 bps 20 bps
Total Property Return            1.8    0.5          4.3    1.6     2.8    1.1
^1 net equivalent yield movement

ERVs across the UK portfolio were 0.3% ahead, compared with a decline of  0.1% 
for the property market as a whole. We saw modest outward yield shift of 4 bps
overall which was significantly less than the market where yields increased by
20 bps. In terms  of our sectors,  UK Retail values were  1% lower with  asset 
management and the  fixed uplifts  in the  portfolio, especially  superstores, 
only partially offsetting outward  yield shift. A  2.2% valuation increase  in 
Offices was driven  by development.  The Offices investment  portfolio was  1% 
ahead, benefiting  from lease  extensions and  new lettings,  particularly  at 

Portfolio Valuation, Yield and ERV Movement
                        Portfolio^1   Change²         Net         Net      ERV
At 30 September 2012                           equivalent  equivalent Growth^4
                                                  yield %       yield
                                 £m         %              movement^3
Retail parks                  2,651     (2.3)         5.9          12      0.0
Superstores                   1,310       0.5         5.1           0      0.3
Shopping centres              1,556     (0.3)         5.8         (2)    (0.3)
Department stores               430     (0.6)         6.6           8      0.8
UK Retail                     5,947     (1.0)         5.7           6      0.0
Europe Retail                   247     (9.3)         8.0          48
All Retail                    6,194     (1.4)         5.8           7
City                          2,145       1.5         5.7           1      1.0
West End                      1,527       3.2         5.6           2      1.2
Provincial                       88       1.3         6.5         (2)      0.0
All Offices                   3,760       2.2         5.7           1      1.0
Other^5                         434       1.2         8.5           2      0.1
UK Total                     10,141       0.2         5.8           4      0.3
Total                        10,388       0.0         5.9           5
^1 Including group's share of properties in
joint ventures and funds
^2 valuation movement during the period (after taking account of capital
expenditure) of properties held at the balance sheet date, including
developments (classified by end use), purchases and sales

³ a positive movement in yields represents an increase in yields, a negative
movement represents a reduction in yields
^4 like for like (as calculated by IPD), excluding Europe
^5 includes developments


Investment activity increased in the half, reflecting both on-going investment
in the group's committed  development programme and a  more active period  for 
acquisitions and  disposals. Institutional  demand for  high quality  property 
remains strong  both  from international  and  domestic institutions.  We  are 
taking advantage of this demand by selectively disposing of more mature assets
to reinvest the capital in higher returning opportunities. The gross value  of 
investment activity during  the half, as  measured by acquisitions,  disposals 
and capital investment in developments was £695 million. When the post  period 
end acquisition  of  Hereford is  included  this increases  to  £785  million. 
Capital spend on developments was £118 million.


At 30 September, the  balance sheet value of  our total committed  development 
pipeline was £792million with an increase of 6.9% over the half driven by the
committed office programme. Based on  our valuers' assumptions, the  committed 
office development programme is expected to deliver a further £175 million (19
pence per share) of development profit.

Committed Developments
                        Sq ft  Current  Cost to Notional  ERV Pre-let Pre-sold
                                 Value complete interest
                         '000       £m     £m^1   £m^1,2   £m      £m       £m
Retail^3                  673       19       98       10  8.2     4.8        -
Offices - inc mixed     2,122      724      370       55 75.2    36.3       87
use residential ^4
Residential -              62       49       22        4   -      -       10
Total Committed         2,857      792      490       69 83.4    41.1       97
Data includes Group's share of properties in Joint Ventures & Funds (except
area which is shown at 100%)
¹ from 1 October 2012 to
practical completion (PC)
² including notional cost of finance of 6%
³ including Hereford acquired post half end, see supplementary table for
^4 including 136,000 sq ft of residential (estimated end value of £128

Acquisitions and Disposals

During the half we completed or exchanged sales of £351 million of assets  (BL 
share £235 million) at  a 3.1% premium  to the March  2012 valuation. Most  of 
these were  retail properties  which were  sold to  a range  of  institutional 
investors. The largest  disposal was  the Beehive  Centre, a  wholly owned  BL 
retail park in Cambridge, for £109 million.  At a blended yield of 5.25%,  and 
3.8% above valuation this provides good support for prime retail park  yields. 
We also sold seven of our smaller  food superstores for a gross value of  £118 
million (BL share £62 million), on a NIY range of 4.95% to 5.7%.

Since 1 April 2012,  we exchanged or completed  acquisitions for £316  million 
(BL share £274  million), all of  which are current  or potential  development 
opportunities which  are generating  only modest  current rental  income.  The 
largest of  these was  the  Clarges Estate,  a  significant mixed  office  and 
residential development site in Mayfair, Central London. Acquisition  included 
the £90  million forward  funding agreement  to enable  the development  of  a 
310,000 sq ft scheme in Hereford city centre which we signed in October. 

Acquisitions and Disposals - Completed/Exchanged since 1 April 2012*

Disposals                                Price BL Share BL Share Annual
                                    (gross) £m       £m Passing Rent £m
Beehive Centre, Cambridge^1                109      109               5
Seven food superstores^3                   118       62               4
Hercules Income Fund^4                      73       19               1
Residential^2                               22       22               -
The Electric Press, Leeds                   13       13               1
Other                                       16       10               1
Total                                      351      235              12
Clarges Estate^1                           130      130               -
Eden Walk Shopping Centre, Kingston         83       41               2
Harmsworth Quays, Canada Water^5            13       13               -
Hereford^6                                  90       90               -
Total                                      316      274               2

* Acquisitions and disposals not previously reported

^1 Exchanged in the period, completed post half end.

^2 Residential sales included £17 million of pre-sold development units  which 
will complete once the developments reach practical completion.

^3 Seven food superstores sold -  two Sainsbury's and one Waitrose were  sold 
by our Sainsbury's JV; one  Tesco was sold by our  Tesco JV and the  remaining 
three stores (two Co-ops and an Aldi) were wholly owned BL group properties.

^4 Hercules  Income Fund  was a  closed-ended Jersey  domiciled Property  Unit 
Trust. On sale it had a portfolio of seven Retail Parks across the UK.

^5 Conditionally exchanged in the period.

^6 Hereford exchanged post period end.


· Focus  on  quality  retail  and asset  management  continues  to  drive 
significant outperformance in a tough market - total returns outperforming IPD
All Retail by 130 bps

· UK Retail portfolio valuation down 1% at £5.9 billion; capital  returns 
outperformed IPD by 130 bps

· 403,000 sq ft of lettings and  lease renewals on average 3.1% ahead  of 

· Tenants in administration 0.6% of total group rent at 30 September

· Footfall  at  +0.3% continues  to  significantly outperform  UK  market 
benchmark - by 300 bps

· UK occupancy stable at 98.3%

· £329 million (BL share £213 million) of retail assets sold at 2%  ahead 
of March valuation

· Acquisitions increase future growth  potential including Eden Walk  and 

· Long-term joint venture signed  with Norges Bank Investment  Management 
at Meadowhall


Our retail  business had  a busy  and productive  half year  delivering  total 
returns significantly ahead at an All Retail market level (by 130 bps) as well
as at the  individual retail individual  subsector level. This  outperformance 
clearly demonstrates the  combined benefits of  our scale, our  range of  high 
quality retail  assets  and  the  market leading  customer  service  we  offer 
occupiers. This outperformance  is not just  short-term: our retail  portfolio 
has generated strong relative total returns over each of the last three years.

The value of our UK retail portfolio  was 1.0% lower at £5.9 billion with  the 
benefits of asset management initiatives and another positive performance from
superstores partially offsetting outward  yield shift across  the rest of  the 
retail portfolio. Our retail  capital returns outperformed  the All UK  Retail 
benchmark by  130 bps.  Yield  shift across  the UK  portfolio  at 6  bps  was 
significantly less than the market at 14 bps.

Our occupational metrics in the UK remain strong. ERVs were maintained  across 
the portfolio outperforming on both a sector level (by 40 bps) and a subsector
basis; occupancy  remained high  at 98.3%,  in line  with 31  March 2012;  and 
footfall at 0.3% ahead, outperforming the  market by 300bps with retail  parks 
showing  the   strongest  relative   performance  at   430  bps.   Leases   in 
administration were 0.6%  of total rent  at the half  year end, including  the 
impact of  JJB, of  which a  significant proportion  have now  been re-let  or 
reassigned. UK like for like net rental income growth was strong at 1.9%  with 
all subsectors positive.

In Europe, which accounts for 2% of our portfolio, the value of our  portfolio 
fell by 9.3%  to £247 million.  This was  principally driven by  falls in  the 
value of the assets in PREF, the European fund in which we have a 65.3% share,
which were impacted by both outward yield shift and rental concessions.

Asset Management

Although the  market remains  tough and  overall deals  are taking  longer  to 
conclude, we continue to benefit from  the changes taking place in the  market 
as retailers  respond  to  the  significant  changes  in  consumers'  shopping 
behaviour. Retailers are aggressively managing their portfolios to ensure they
are in the best quality spaces to satisfy consumers' demands for experiential,
convenient and functional  shopping. Our  portfolio is well  matched to  these 
changing requirements. Because our estate remains nearly fully occupied and in
demand, we continue  to agree lettings  ahead of ERV.  Lettings have now  been 
ahead of ERV for each period since  30 September 2010, over which period,  our 
ERVs have grown by  2.1% (IPD: -0.7%). Our  pipeline remains encouraging  with 
just under 380,000 sq ft of space under offer, overall ahead of ERV.

We agreed 403,000 sq ft of lettings and renewals in the half, on average  3.1% 
ahead of ERV and  ahead of ERV  for each subsector. Over  70% of the  lettings 
were above or in line with ERV. Our letting activity was focused on improving
and  evolving  the  retail  environment  on  our  schemes  by  leveraging  our 
relationships with existing  retailers; improving  the retail  offer with  new 
trading formats; and increasing the proportion of food and leisure.

At Fort Kinnaird in Edinburgh, we  signed 70,000 sq ft of leasing  initiatives 
which included the expansion and  refitting of Next's existing store.  Smyth's 
Toys and Mamas  and Papas  also recently opened  new units.  Further to  this, 
subject to  planning,  we  are extending  the  park  to include  a  cinema,  6 
restaurants and a  60,000 sq  ft department store  (including a  30,000 sq  ft 
mezzanine) which has been pre-let to Debenhams.

At Meadowhall, we continued  our successful strategy  to broaden the  centre's 
overall appeal  by  widening  its catchment  area,  attracting  more  affluent 
consumers and  by extending  the time  people  spend there.  41,000 sq  ft  of 
lettings since the  beginning of  the year include  Armani Exchange,  Tessuti, 
Lego and  Crocs with  Carluccio's also  opening in  the new  refurbished  food 
court. These lettings further improved the  overall quality of the retail  and 
food offer and maintaining high occupancy levels. Footfall grew by 2.8%.


We have 673,000 sq ft of committed retail development underway in the UK which
will take  advantage of  the lack  of  new high  quality retail  space.  These 
include the major redevelopment of Whiteley  Shopping Centre, a 317,000 sq  ft 
next generation scheme between Southampton  and Portsmouth which is  scheduled 
to open in May 2013. Works are progressing well and the scheme is nearly  80% 
pre-let to the likes of M&S, Next, H&M, River Island, Boots and JD Sports.  At 
Glasgow Fort, our fully pre-let 45,000  sq ft cinema and restaurant  extension 
which will  improve  the scheme's  leisure  offer,  is scheduled  to  open  in 
September 2013. Our committed pipeline also includes the forward funding of  a 
310,000 sq ft retail and leisure development in Hereford which we will own  on 

We are progressing  with planning on  a further 713,000  sq ft of  prospective 
development  initiatives  in  the  UK.  This  includes:  cinema  additions  at 
Broughton Park Chester and  Fort Kinnaird Edinburgh; and  an extension to  our 
existing shopping  centre at  Surrey  Quays. We  have also  recently  received 
planning permission for a major external refurbishment of Debenhams'  flagship 
store in Oxford Street.

In Europe,  the  new 1.4  million  sq ft  Puerto  Venecia shopping  centre  in 
Zaragoza successfully opened on  schedule in early  October. On opening,  the 
shopping  centre  was  90%  pre-let/under  offer  to  an  extensive  range  of 
international and national brands including all of the Inditex Group's brands,
Desigual, H&M and Mango  along with key anchors  El Corte Inglés and  Primark. 
The centre has traded well  since opening with footfall  of over 2 million  in 
the first 4 weeks.

Investment Activity

We agreed  or exchanged  £329  million of  retail properties  including  seven 
superstores and the Beehive retail park in Cambridge. Details of the sales are
provided in the Business Review.

In July, we entered into a 50:50 joint venture at Eden Walk Shopping Centre in
Kingston-upon-Thames  with  the  existing  owner  Universities  Superannuation 
Scheme (USS). The purchase  price of £41.5 million,  represents a net  initial 
yield of  5.35%. Eden  Walk is  a 276,000sqft  open shopping  centre in  the 
centre of Kingston, anchored by Marks  & Spencer, Sainsbury's, Boots and  BHS. 
Kingston, which is  in the south  west of  London, has one  of the  strongest 
consumer catchment areas in  the UK with a  high proportion of young  affluent 
residents. We are responsible for asset management of the centre and are  also 
acting as development  manager to  assess and progress  what we  believe is  a 
significant medium-term development opportunity.

In October, we signed a joint venture agreement at Meadowhall with Norges Bank
Investment Management,  following  their purchase  of  a 50%  stake  from  our 
previous partner, London and Stamford.  Under the agreement, we will  continue 
to manage the asset.

After the half year end, we signed a £90 million forward funding agreement  to 
enable the development of a 310,000 sq ft scheme in Hereford city centre which
we will own on  completion. The open  air scheme, on  the site of  Hereford's 
former cattle market, will comprise 22  retail units, seven restaurants and  a 
six-screen cinema. More  than 50%  of the  space has  already been  pre-let. 
Debenhams will anchor the  scheme with an 84,000  sq ft department store  with 
Waitrose, Next, TK Maxx, Frankie & Benny's and the Odeon all committing to the
scheme. Work is expected to start on  site later this year with completion  in 
spring 2014.



· Our focus  on Central  London drives continued  outperformance -  total 
returns outperformed IPD All Offices by 270 bps

· Offices portfolio valuation +2.2% to £3.8bn; investment portfolio +1.0%

· 547,000 sq ft of leasing  activity; lettings and extensions on  average 
7.5% ahead of ERV

· Over 300,000 sq ft of lease extensions at Broadgate to an average lease
term of 9 years

· Like-for-like occupancy  up 30  bps to 98.3%;  occupancy including  199 
Bishopsgate following practical completion at 96.6%

· Ahead of investment case on developments: further £50 million of profit
crystallised; £175  million  of profit  still  to come  on  current  valuers' 

· Developments 56% pre-let/under offer; 97% contracts placed; projects on
time and budget

· Greater focus on West End (44% of Central London portfolio), reflecting
Clarges purchase and development progress


Our Offices business had another good period due not only to our focus on  the 
right locations in London but also to the quality of our customer services and
the success  of our  development programme.  We outperformed  the broader  All 
Offices IPD benchmark and the individual City and West End subsectors on  both 
total and capital returns. 

The value  of our  Offices portfolio  rose by  2.2% to  £3.8 billion:  capital 
returns were 2.3% outperforming  the All Office benchmark  by 330 bps. Of  the 
£80 million uplift, around 30% was contributed by asset management initiatives
(mainly lettings and  lease extensions at  Broadgate) and the  expiry of  rent 
frees in the investment portfolio with development contributing the remainder.
We have now crystallised £216 million of profit (24 pence per share) from  the 
current development  programme, already  generating a  10.7% profit  on  cost, 
ahead of  our  original  investment  case, with  another  £175  million  still 
expected to be realised based on our valuers' current estimates.

Our operational metrics remain robust: our ERV growth continued to be positive
(at +1.0%); we signed lettings and  lease extensions comfortably ahead of  ERV 
(+7.5%); and on  a like-for-like basis,  occupancy rose by  30 bps to  98.3%. 
Including our  199  Bishopsgate  development, which  only  achieved  practical 
completion in September, our  occupancy was 96.6%. Rents  subject to break  or 
expiry over the  next three  years have  significantly reduced  from 21.2%  at 
September 2009 to 6.4%.  Like for like  net rental income  fell 0.4% as  lease 
extensions  impacted  near  term   rental  income,  through  short-term   rent 

Asset management

The quality of our buildings and our customer service means occupiers are  not 
only choosing  to come  to  our buildings  but  are also  signing  significant 
extensions to stay in our properties. Our asset management activity builds  on 
our successful track record  of attracting and  retaining occupiers in  recent 

Since the beginning of the year, we have signed leasing initiatives on 547,000
sq ft of space with lettings and lease extensions (including pre-lets)  signed 
on average  at 7.5%  ahead of  ERV. Our  activity primarily  focused on  lease 
extensions which accounted  for 412,000 sq  ft of total  leasing. We also  let 
99,000 sq ft reflecting the high occupancy levels in our investment  portfolio 
at 8.7% above  ERV. A significant  proportion of our  leasing activity was  at 
Broadgate, where we agreed long term extensions with Herbert Smith (315,000 sq
ft) and F&C  (54,000 sq  ft) at  Exchange House  and 10  Exchange Square.  At 
Broadgate Tower, we agreed  50,000 sq ft of  lettings with Itochu, Banco  Itau 
and Hill Dickinson at  rents accretive to ERV  increasing occupancy to  93.2%. 
All of this leasing activity has  increased the average weighted lease  length 
at Broadgate to 8.1 years, excluding pre-lets.

In addition,  after the  end of  the half  year, we  signed a  minimum 2  year 
extension with ICAP (174,000 sq ft) at 1-2 Broadgate which secures their lease
until at least 2019.


We  are  generating  significant  incremental  returns  from  our  development 
programme in Central London and we  remain well ahead of our investment  case. 
The value of our committed office  developments rose by 6.9% to £724  million. 
The uplift in the first half was driven by a combination of profit release  on 
buildings in  the  West  End  due for  practical  completion  next  year;  the 
pre-letting of additional space at  NEQ; increases in estimated rental  values 
and the release of certain  contingencies following the successful placing  of 
building contracts.

In the West End, we are on  schedule to complete our developments at  Regent's 
Place (10, 20 and 30  Brock Street), 10 Portman  Square and Marble Arch  House 
during 2013. We are  encouraged by the  levels of interest  we have seen  from 
potential occupiers ahead of practical completion which is less common in  the 
West End than the City. At 10 Brock Street, where we are progressing well with
cladding and Cat. A fit out, we let a further 29,500sqft of office space  to 
Debenhams, taking  their  total  pre-let to  174,000sqft,  around  half  the 
building. Post the end of the half year, we completed a 24,500 sq ft  pre-let 
to Aspect Capital  at 10 Portman  Square at a  headline rent of  over £90  psf 
taking our development programme to 56% pre-let. We have a further 34,400  sq 
ft under offer after the year end including 24,400 sq ft at 10 Portman Square.
In total, all the pre-lettings agreed and under offer at 10 Portman Square are
7% ahead of September ERVs.

In the  City,  where  we are  already  nearly  70% pre-let,  we  have  reached 
practical completion at 199  Bishopsgate and are making  good progress on  our 
two remaining developments.  At The Leadenhall  Building, building works  have 
now reached the 29^th  floor and at  5 Broadgate, which is  fully let to  UBS, 
work has commenced on the first core which is up to level 3.

We have a strong  track record in residential  development in Central  London: 
since December  2009, we  have committed  £250  million to  230,000 sq  ft  of 
residential developments both within our West End office developments and on a
standalone basis. During the half, we  sold 18 residential units for a  total 
of £17 million. Prices  achieved were well ahead  of investment case  bringing 
our total proceeds from  our residential developments  since December 2009  to 
£126million. We currently have a further  £8.3 million of units under  offer. 
We also  have  further  potential  residential  development  opportunities  at 
Aldgate Place, a development  site conditionally acquired  in a joint  venture 
with Barratt's last year.

Investment Activity

We believe that  selective development  in Central London  will generate  good 
returns over the medium term given  the continuing attractions of the  capital 
to occupiers and  investors and  the on-going  relative short  supply of  high 
quality space. We  are investing  in replenishing our  office and  residential 
pipeline and continue our strategy of a moving the weighting of our  portfolio 
from the City toward the West End.

In July,  we  agreed  to purchase  the  Clarges  Estate for  £130  million,  a 
development site of nearly  one acre in the  heart of Mayfair, Central  London 
with an  existing  planning consent  for  a 191,000  sq  ft mixed  office  and 
residential scheme. The transaction  was completed after the  year end and  we 
are well  advanced on  developing a  revised  scheme and  expect to  submit  a 
further planning application in the New Year.

                               FINANCIAL REVIEW


· Underlying PBT up 3.8%  to £137 million, IFRS  PBT of £109 million  (HY 
2011/12: £331 million)

· Underlying diluted EPS up 4.1% to 15.2p driven by acquisitions

· EPRA Net Asset  Value per share  at 596 pence, 0.2%  ahead of 31  March 
2012 (595 pence)

· Total accounting return of 5.3% for the 12 months to 30 September 2012

· Dividend increased to 6.6 pence per share for Q2; half year dividend of
13.2 pence

· £917 million  of financing  signed, improving  liquidity, reducing  the 
cost of debt and diversifying the debt investor base

Income Statement

The group financial statements are  prepared under IFRS. The income  statement 
includes valuation  movements  on  investment properties  and  the  after  tax 
results of joint ventures and  funds are shown as  a single line. The  balance 
sheet includes the  net investment  in joint ventures  and funds  as a  single 

Management  reviews  the  performance  of   the  business  principally  on   a 
proportionally consolidated basis (i.e. on a line-by-line basis) and  comments 
on movements in the  income statement provided in  the financial review  below 
are made  on this  basis.  Income statements  and  balance sheets  which  show 
British Land's interests on this basis are also included in Table A within the
supplementary disclosures.

6 months to 30                     2012                        2011
                        Group      JVs &       Prop Group     JVs &       Prop
                                   Funds     Consol           Funds     Consol
                           £m         £m         £m    £m        £m         £m
Gross rental income       149        135        284   146       137        283
Property outgoings        (7)        (5)       (12)   (7)       (7)       (14)
Net rental income         142        130        272   139       130        269
Net financing costs      (39)       (65)      (104)  (34)      (73)      (107)
Net rental income less    103         65        168   105        57        162
Fees & other income         8          -          8     8         -          8
JVs & Funds underlying     63                          54
Administrative expenses  (37)        (2)       (39)  (35)       (3)       (38)
JVs & Funds underlying                63                         54
Underlying profit         137                   137   132                  132
before tax
IFRS profit before        109                   109   331                  331
Underlying diluted EPS  15.2p                 15.2p 14.6p                14.6p
Dividend per share      13.2p                 13.2p 13.0p                13.0p

Net rental income, including our share of joint ventures and funds,  increased 
1.1% to £272 million for the 6 months ending 30 September 2012. The impact  of 
acquisitions added £7  million, including  the Virgin  Active portfolio.  This 
more than  offset  the impact  of  disposals  and assets  transferred  to  the 
development program (£5 million).

On a like-for-like basis,  UK net rental  income was 1.2%  higher than a  year 
ago. In  UK  retail, like-for-like  net  rental income  increased  1.9%,  with 
improvements across all subsectors.  This has been offset  by a 0.4%  downward 
movement in the office portfolio. West End offices have been impacted by lease
extensions and space  taken back, which  we plan to  re-let once  refurbished, 
partially offset with City offices delivering  a 1.4% increase, driven by  new 
lettings. UK occupancy remains strong  at 98.3% on a  like for like basis  and 
97.7%  including  199  Bishopsgate  which  achieved  practical  completion  in 
September. Our average lease  length is 11.1 years.  A quarter of rents  are 
subject to annual RPI or fixed  uplifts. Leases in administration account  for 
only 0.6% of our rent profile as at 30 September 2012.

Administrative costs  have  increased  by  £1m as  a  result  of  the  Group's 
investment in our  asset management  and analytical  functions and  inflation, 
partially offset by our continued focus on cost containment.

The Group measures its operating efficiency as the proportion of gross  rental 
income represented by its net operating costs (representing property outgoings
and administrative expenses, net of fees and other income). The ratio for the
half year was  15.1% (half year  2011: 15.5%) and  this remains efficient  and 
competitive. In the near term  we expect this to increase  as the cost of  our 
current  developments   reaching  practical   completion  increases   property 

Net financing costs  have decreased in  the half year  due principally to  the 
impact of disposals and increased interest capitalised on developments  offset 
by the interest impact of financing acquisitions. In the current half year, £7
million of financing  costs have been  capitalised into development  projects. 
Capitalisation of financing costs is expected to increase as we move into  the 
peak  phase  of  these  developments   over  the  next  18  months.   Interest 
capitalisation will cease on practical completion of these developments.

The key drivers discussed above have increased underlying profit before tax by
£5 million, or  3.8%, to  £137 million  for the  6 months  ended 30  September 
2012. Underlying  diluted  earnings per  share  for  the 6  months  ended  30 
September 2012 increased 4.1% to 15.2 pence (half year 2011: 14.6 pence) based
on underlying profit after tax of £136 million (half year 2011: £130  million) 
and weighted average diluted number of shares of 894 million (half year  2011: 
893 million).

Rental Growth Potential

The Group has significant rental growth potential in its property  portfolio. 
The table below  shows how current  rents will grow  following expiry of  rent 
free periods, contracted rental uplifts and development lettings.

                                                   Annualised Gross Rent
                                              Cash flow basis Accounting basis

                                                         £m^1               £m
Current (passing) rent                                  528^2
Expiry of rent free periods^3                              51            561^2
Fixed and minimum uplifts^3,4                              15
RPI uplifts^3,5                                             8                8
Developments - pre-let^2                                   41               35
Developments - to let^2                                    42               36
Rent review uplifts^3                                       6                6
Uplift from reletting of expiries and                      23               18
Total                                                     714              664
Of which contracted                                       635              596

^1 gross rents on a cash basis plus, where rent reviews are outstanding, any
increases to ERV (as determined by the Group's external valuers), less any
ground rents payable under head leases

^2 adjusting for acquisitions, disposals and pre-lets made post period end.

^3 over the next 5 years

^4 All contracted fixed and minimum uplifts (EPRA and non-EPRA)

^5 Illustrative impact based on growth in RPI of 2.5%pa


                       As at 30 September 2012        As at 31 March 2012
                      Group      JVs &       Prop   Group      JVs &      Prop
                                 Funds     Consol              Funds    Consol
                         £m         £m         £m      £m         £m        £m
Properties at         5,466      4,922     10,388   5,414      4,923    10,337
Investment in JVs &   2,442                         2,309
Other non-current        48        (2)         46      28       (11)        17
                      7,956      4,920     10,434   7,751      4,912    10,354
Other net current      (91)       (74)      (165)   (132)      (110)     (242)
Net debt            (2,460)    (2,328)    (4,788) (2,229)    (2,461)   (4,690)
Other non-current      (13)       (76)       (89)     (9)       (32)      (41)
JVs & Funds' net                 2,442                         2,309
EPRA net assets^1     5,392                 5,392   5,381                5,381
EPRA adjustments^1                          (315)                        (277)
IFRS net assets                             5,077                        5,104
EPRA NAV per share                           596p                         595p

^1 EPRA net assets exclude  the mark to market  on effective cash flow  hedges 
and related debt adjustments  and deferred taxation  on revaluations. It  also 
includes trading properties  at fair value  and is diluted  for the impact  of 
share options

At 30  September 2012,  EPRA  Net Asset  Value per  share  was 596  pence,  an 
increase of  0.2%  on the  31  March 2012  comparative.  Property  revaluation 
movements are flat for  the half year, outperforming  the market with  capital 
returns 200 bps ahead of IPD, demonstrating the resilience of our portfolio in
a tough investment market. Our total accounting return for the 6 months  ended 
30 September 2012 is 2.4% (5.3% for the 12 months to 30 September 2012). 

Net Debt and Financing

Net debt (EPRA) basis at 30 September 2012 was £2.5 billion for the Group  and 
£4.8 billion including our  share of joint ventures  and funds. The  principal 
value of gross debt excluding cash, short term deposits and liquid investments
was £2.7  billion  for  the  Group  and  £5.1  billion  on  a  proportionally 
consolidated basis.  The  strength  of  the Group's  balance  sheet  has  been 
reflected in British Land's senior unsecured credit rating which remains rated
by Fitch at A-.

The proportionally  consolidated  LTV  increased marginally  to  46.0%  at  30 
September 2012 (31  March 2012:  45.3%), due to  expenditure on  developments. 
With  prospective  development  spend  of  £490  million  on  our   committed 
development programme, principally in the next 18 months, our LTV is  expected 
to increase further. However, asset recycling  is likely and the proceeds  may 
partially offset the development spend .

Financing statistics                             Group Prop Consol
EPRA Net debt                                  £2,460m     £4,788m
Principal value of gross debt                  £2,672m     £5,122m
Weighted average debt maturity               8.9 years   9.4 years
Weighted average interest rate of drawn debt      4.0%        4.4%
% of debt at fixed/capped rates                    89%         95%
Interest cover^1                             2.9 times   2.3 times
Loan to value^2                                  31.5%       46.0%

^1 Underlying profit before interest and tax / net interest

^2 debt to property and investments

At 30 September 2012 the Group had £2.3 billion of available committed banking
facilities. We now have £1 billion of facilities with maturities of more than
3 years. The Group also  has £207 million of  liquid investments and cash  and 
short-term deposits. Cash and short-term deposits are temporarily high at each
quarter end due to  rents received just before  each quarter end and  interest 
and scheduled debt amortisation being paid just after.

We continued to achieve attractive financings, raising £917 million (BL  share 
£703 million) of bonds and facilities  since the start of this financial  year 
on  competitive  terms  and  which  improve  liquidity.  The  number  of   new 
institutions involved further  diversifies the debt  investor base and  brings 
total new financings  arranged over  the last 18  months to  £2.5 billion  (BL 
share £2.0 billion).

In May 2012, HUT signed  a new £350 million five  year loan facility. A  £250 
million term loan was  used to fully repay  the existing credit facility.  The 
interest rate on the term loan has been swapped to a fixed rate, resulting  in 
an all-in rate including margin and arrangement fees below the fixed  interest 
rate under  the previous  financing.  A further  £100 million  revolving  loan 
facility will provide flexibility for HUT in respect of acquisitions,  capital 
projects, disposals and general business purposes.

In September 2012, the Group issued a £400 million 5 year convertible bond  on 
highly attractive terms benefiting from strong investor demand. The coupon  is 
1.5% and if converted, British Land has the option to settle in shares or cash
or a combination  of shares and  cash. The  conversion price was  set at  693 
pence, a 31.25% premium to  the share price at the  time and will be  adjusted 
down to reflect any incremental dividends paid over the current level of  26.4 
pence per  share.  The convertible  has  further improved  our  diversity  of 
sources of  finance with  only  15% of  our  debt currently  drawn  comprising 
unsecured revolving bank facilities.

Since the beginning of the  year, we also completed  over £140 million of  new 
bi-lateral committed revolving loan facilities  for British Land with  several 
banks on our usual unsecured financial covenants.

The  weighted  average  interest  rate  reduced   from  4.6%  to  4.4%  on   a 
proportionally consolidated basis  principally incorporating  the benefits  of 
refinancings. Average debt maturity of 9.4 years compares with average  lease 
lengths of 11.1 years.


Net cash inflow from operating activities  for the six months was £92  million 
including receipts from  joint ventures  and funds of  £62 million.  Investing 
activity absorbed  a net  £238 million,  of  which £47  million was  spent  on 
purchases, £93 million on development and capital expenditure, £182 million on
investments in and  loans to  funds and  joint ventures,  partially offset  by 
receipts from  disposals of  £90  million. Disposals  in the  period  include: 
Liverpool Church  Street, Leeds  Electric  Press and  our investment  in  HIF. 
Acquisitions include Eden Walk in Kingston. Since the end of the half year, we
have completed the  disposal of  the Beehive Centre,  Cambridge (£109  million 
proceeds) and the  acquisition of  the Clarges Estate,  Mayfair (£122  million 
payment made on completion).


The second quarter dividend of 6.6 pence per share, totalling £59 million,  is 
payable on  15 February  2013 to  shareholders  on the  register at  close  of 
business on 11 January 2013. The  Board will announce the availability of  the 
Scrip Dividend Alternative via the Regulatory News Service and on our  website 
(, no later  than 4 business  daysbefore the  ex-dividend 
date of 9 January 2013. In respect of the first quarter dividend for  2012-13, 
some 39%  of shareholders  opted for  the scrip  alternative, in  lieu of  £23 
million in cash dividends. The Board expects to announce the split between PID
and non-PID income at that time.

The total dividend for the half year  is 13.2 pence per share, an increase  of 
1.5% on the 2011/12 half year dividend. This is in line with the announcement
made by the Board  at the full year  results in May 2012.  In line with  this 
announcement the Board's intention is for the 2012/13 financial year  dividend 
to be 26.4 pence per share.


In preparing these financial statements, the key accounting judgement  relates 
to the carrying value of the  properties and investments, which are stated  at 
market value. The Group uses  external professional valuers to determine  the 
relevant amounts.

The primary  source of  evidence  for property  valuations should  be  recent, 
comparable  market  transactions  on  an  arms-length  basis.  However,   the 
valuation of the Group's property portfolio is inherently subjective, as it is
made on the basis of assumptions made by the valuers which may not prove to be
accurate. It should  be noted that  the external valuations  received for  our 
properties in Portugal, Spain  and Italy include  a market uncertainty  clause 
due to the lack  of transactional evidence and  uncertainty over the  economic 
situation in those markets.

REIT status: the Company has elected for REIT status. To continue to benefit
from this regime, the Group is  required to comply with certain conditions  as 
defined in the  REIT legislation.  Management intends that  the Group  should 
continue as a REIT for the foreseeable future.

Accounting for  joint  ventures  and  funds: an  assessment  is  required  to 
determine the degree of control or influence the Group exercises and the  form 
of any control to ensure  that financial statement treatment is  appropriate. 
Interest in the Group's joints ventures is commonly driven by the terms of the
partnership agreements  which  ensure  that  control  is  shared  between  the 
partners. These  are  accounted for  under  the equity  method,  whereby  the 
consolidated balance sheet incorporates the Group's share of the net assets of
its  joint  ventures  and  associates.  The  consolidated  income   statement 
incorporates the Group's share  of joint venture  and associate profits  after 
tax upon elimination of upstream transactions.


Effective management of risk is considered to be fundamental to the success of
the company's operations and delivery  of performance. The company's  approach 
to risk management remains as set out on pages 38-39 of the Annual Report  and 
Accounts published in May 2012. Governance and oversight of the processes  has 
been enhanced by  the establishment of  a Risk Committee  in the period.  This 
committee of the executive directors holds responsibility for delivery of both
strategic and operational aspects of risk management.

The Directors' assessment is that  the principal risks and uncertainties  that 
the company is exposed  to and which may  impact performance in the  remaining 
six months of the financial  year, are unchanged from  those set out on  pages 
40-42 of the Annual Report and Accounts published in May 2012.

Within those principal  risks and  uncertainties, the  Directors consider  the 
interlinked external risks of economic uncertainty, occupier demand and tenant
default, investor demand,  and availability and  cost of finance  to have  the 
greatest scope  to impact  performance  in the  remaining  six months  of  the 
financial year.

Whilst in  many respects  the  UK economy  appears  to have  stabilised,  this 
position remains fragile  with little  growth anticipated in  the short  term. 
Major threats to global economic stability, and hence the UK economy,  include 
the pending fiscal cliff in the  United States and potential economic  failure 
of one  or more  members of  the Eurozone  or a  disorderly break-up  of  that 
monetary union.  Whilst  British Land  does  have some  exposure  to  specific 
country and currency risk through  ownership of properties located within  the 
Eurozone, this is limited, with  total Eurozone exposure representing only  2% 
of gross assets.

A greater risk area for British Land is the potential dislocation in  property 
and financing markets which may arise from a disorderly break-up the  Eurozone 
or further  slowing in  global economic  growth  if the  fiscal cliff  is  not 
resolved. The resultant reduction in  liquidity and availability of  financing 
coupled with the  impact on  the economic  outlook may  result in  significant 
adverse property  valuation movements  affecting  our financial  position  and 

In order to  ensure that  our business  is sustained  should this  eventuality 
arise, we consider such scenarios in monitoring our covenant headroom. We also
mitigate the impact of such dislocation by maintaining an appropriate level of
committed financing, in terms of maturity, diversity of sources and  available 
undrawn facilities. This provides  adequate comfort that we  would be able  to 
meet our funding requirements in the event of a deterioration of liquidity  in 
lending markets.

The medium term  outlook is for  interest rates to  remain low but  a risk  of 
increasing benchmark rates or credit spreads exists which may adversely impact
the cost  of finance  and  consequently dampen  investor appetite  or  inflate 
required investor returns.

With public spending cuts continuing, consumer confidence, although stable, is
expected to remain fragile meaning that  an elevated risk of occupier  default 
exists. We actively manage our tenant mix to minimise exposure to occupiers at
risk and have a strong record of re-letting space that does become  available, 
evidenced by our continuing high occupancy rate.

British Land's  identified principal  risks and  uncertainties are  summarised 
below. Further  information on  these, including  the approach  to  mitigating 
these risks can  be found on  pages 40-42  of the Annual  Report and  Accounts 
published in May 2012.

External Risks

Economic  uncertainty   (notably  Eurozone)   -  Continued   global   economic 
uncertainty presents risks to  financing and property markets  as well as  the 
businesses of our occupiers. Notably, failure  of one or more members of  the 
Eurozone could cause serious dislocation  to the property and finance  markets 
and could directly impact valuations and performance of British Land's limited
property holdings in mainland Europe as well as treasury liquidity.

Investor demand - Reduction in investor  demand for UK real estate may  result 
in falls in asset valuations and could arise from variations in the health  of 
the UK economy, the  attractiveness of investment in  the UK, availability  of 
finance to property investors and  the relative attractiveness of other  asset 

Occupier demand  and tenant  default -  Underlying income,  rental growth  and 
capital performance could be adversely  affected by weakening occupier  demand 
resulting from  variations  in health  of  the UK  economy  and  corresponding 
weakening of  consumer confidence  and business  activity and  investment.  In 
addition, occupier failures may adversely impact underlying income and capital
performance. Changing consumer and business practices (e.g. Internet shopping,
flexible working practices  and demand  for energy  efficient buildings),  new 
technologies and alternative locations may result in earlier than  anticipated 
obsolescence of our buildings if evolving occupier requirements are not met.

Availability and cost of finance -  Reduced availability of financing to  real 
estate investors may  result in  weaker investor  demand for  real estate  and 
adversely impact  British Land's  ability  to refinance  expiring  facilities. 
Increasing finance costs  would reduce  British Land's  underlying income  and 
increase required returns for real estate investors.

Catastrophic business event  - An external  event such as  a civil  emergency, 
including a  large scale  terrorist attack,  or environmental  disaster  could 
severely disrupt global  markets (including  property and  finance) and  cause 
significant damage and disruption to British Land's portfolio and operations.

Internal Strategic Risks

Investment  strategy  -   Significant  underperformance   could  result   from 
inappropriate  determination  of   property  investment  strategy,   including 
consideration of: sector  selection and  weighting; timing  of investment  and 
divestment decisions; exposure to developments; sector, asset, tenant,  region 
concentration; and engagement with co-investment partners.

Development - Development risks could  adversely impact underlying income  and 
capital performance  including:  development  letting  exposure;  construction 
timing and costs; major contractor failure; and adverse planning judgements.

Income sustainability - Sustainability of our income streams is required to be
considered in: execution of investment strategy and capital recycling, notably
timing of  reinvestment of  sale  proceeds; nature  and structure  of  leasing 
activity; and nature and timing of asset management and development  activity. 
Inappropriate decision-making and execution in respect of the above may result
in disruptions  to underlying  profit growth  outside the  scope of  strategic 

Capital Structure -  gearing - An  inappropriate gearing level  may result  in 
significant net asset value underperformance. An increase in the gearing level
increases the risk of  a breach of covenants  on borrowing facilities and  may 
increase finance costs.

Financing strategy execution - Failure  to manage the refinancing  requirement 
may result in a shortage of funds to sustain the operations of the business or
repay facilities as they fall due.

Corporate and Compliance Risks

Communication - Failure to adequately  communicate the Company's strategy  and 
explain performance in respect of this  may result in an increased  disconnect 
between investor perceptions of value and actual performance.

People - Failure to recruit, develop  and retain staff and directors with  the 
right skills and experience may result in significant underperformance.


We confirm that to the best of our knowledge:

(a) the condensed set of financial statements has been prepared in accordance
with IAS 34;

(b) the interim management report includes  a fair review of the  information 
required by DTR4.2.7R (indication  of important events  during the first  six 
months and description of principal risks and uncertainties for the  remaining 
six months of the year); and

(c) the interim management report includes  a fair review of the  information 
required by DTR4.2.8R (disclosure of  related party transactions and  changes 


The Group's business activities,  together with the  factors likely to  affect 
its future development,  performance and  position are  set out  in the  Chief 
Executive's and Business Review. The financial position of the Group, its cash
flows, liquidity  position  and borrowing  facilities,  are described  in  the 
accounts below.

The Group has considerable undrawn debt facilities and cash deposits in excess
of current drawn banking facilities. There is substantial headroom against the
covenants for its unsecured banking facilities, details of which are  included 
in Note 6 to the accounts. It  also benefits from a diverse and secure  income 
stream from  leases with  long  average lease  terms.  As a  consequence,  the 
directors believe that the Group is  well placed to manage its business  risks 
satisfactorily despite the current uncertain economic outlook.

The directors have  a reasonable expectation  that the Company  and the  Group 
have  adequate  resources  to  continue  in  operational  existence  for   the 
foreseeable future. Thus, they  continue to adopt the  going concern basis  in 
preparing the financial statements.

By order of the Board, Lucinda Bell, Finance Director



                             SUPPLEMENTARY TABLES

          (Data includes Group's share of Joint Ventures and Funds)

Portfolio Valuation
At 30 September 2012                  Group        JVs &      Total    Change²
                                         £m           £m         £m          %
Retail parks                          1,848          803      2,651      (2.3)
Superstores                             135        1,175      1,310        0.5
Shopping centres                        470        1,086      1,556      (0.3)
Department stores                       430            -        430      (0.6)
UK Retail                             2,883        3,064      5,947      (1.0)
Europe Retail                             -          247        247      (9.3)
All Retail                            2,883        3,311      6,194      (1.4)
City                                    542        1,603      2,145        1.5
West End                              1,527            -      1,527        3.2
Provincial                               84            4         88        1.3
All Offices                           2,153        1,607      3,760        2.2
Other^3                                 429            5        434        1.2
UK Total                              5,465        4,676     10,141        0.2
Total                                 5,465        4,923     10,388        0.0
^1 group's share of properties in joint ventures and funds
^2 valuation movement during the period (after taking account of capital
expenditure) of properties held at the balance sheet date, including
developments (classified by end use), purchases and sales
³ including developments

Portfolio Net Yields^1
                                        EPRA   Overall
At 30 September 2012      EPRA net topped up topped up          Net        Net
(excluding developments)   initial       net       net reversionary equivalent
                           yield %   initial   initial      yield %    yield %
                                   yield %^2 yield %^3
Retail parks                   5.6       5.7       5.9          5.8        5.9
Superstores                    5.1       5.1       5.1          5.0        5.1
Shopping centres               5.4       5.6       5.7          6.0        5.8
Department stores              5.9       5.9       8.9          4.8        6.6
UK Retail                      5.4       5.6       5.9          5.6        5.7
Europe Retail                  6.7       6.7       6.7          7.8        8.0
All Retail                     5.5       5.6       5.9          5.7        5.8
City                           4.1       6.0       6.0          6.1        5.7
West End                       4.4       5.4       5.6          5.8        5.6
Provincial                     7.2       7.2       7.2          5.8        6.5
All Offices                    4.3       5.8       5.9          6.0        5.7
Other                          7.6       7.6       9.7          6.0        8.5
UK Total                       5.1       5.7       6.0          5.7        5.8
Total                          5.2       5.7       6.0          5.8        5.9
^1 including notional purchaser's costs
^2 including rent contracted from expiry of rent-free periods and fixed
uplifts not in lieu of growth
^3 including fixed/minimum uplifts (excluded from EPRA definition)

Portfolio Weighting
At 30 September                    2011              2012                 2012
%                                               (current)        (pro-forma^1)
Retail parks                       26.5              25.5                 23.0
Superstores                        13.3              12.6                 11.7
Shopping centres                   15.0              15.0                 14.8
Department stores                   4.4               4.1                  3.9
UK Retail                          59.2              57.2                 53.4
Europe Retail                       2.7               2.4                  2.2
All Retail                         61.9              59.6                 55.6
City                               19.7              20.7                 22.4
West End                           12.9              14.7                 17.3
Provincial                          1.0               0.8                  0.8
All Offices                        33.6              36.2                 40.5
Other                               4.5               4.2                  3.9
Total                             100.0             100.0                100.0
^1 pro forma for committed developments to date at estimated end value (as
determined by the Group's external valuers, except post valuation acquisitions
which are determined by management) and disposals completed post half end.

Gross Rental Income^1
(Accounting Basis)  6mths to 30 September 2012   Annualised as at 30 September
£m                                                           2012
                       Group     JVs &     Total     Group     JVs &     Total
                                 Funds                         Funds
Retail parks              54        22        76       108        45       153
Superstores                4        32        36         8        62        70
Shopping centres          17        31        48        32        62        94
Department stores         16         -        16        31         -        31
UK Retail                 91        85       176       179       169       348
Europe Retail              -         8         8         -        22        22
All Retail                91        93       184       179       191       370
City                      13        41        54        26        81       107
West End                  27         -        27        51         -        51
Provincial                 3         -         3         6         -         6
All Offices               43        41        84        83        81       164
Other                     16         -        16        32         -        32
Total                    150       134       284       294       272       566
^1 gross rental income will differ from annualised rents due to accounting
adjustments for fixed & minimum contracted rental uplifts and lease incentives

Annualised Rent & Estimated Rental Value (ERV)
At 30 September 2012       Annualised rent         ERV £m  Average rent £psf
(excluding              (valuation basis) £m^1
developments)            Group     JVs &    Total   Total  Contracted^2  ERV^2
Retail parks               109        45      154     161          22.9   23.3
Superstores                  8        62       70      70          21.4   21.3
Shopping centres            33        61       94     101          25.7   26.9
Department stores           27         -       27      22          12.5   10.2
UK Retail                  177       168      345     354          21.9   22.4
Europe Retail                         22       22      24           8.7    9.4
All Retail                 177       190      367     378          20.1   20.6
City                         5        77       82     120          46.1   44.9
West End                    50         -       50      65          43.8   44.3
Provincial                   6         -        6       5          27.1   22.0
All Offices                 61        77      138     190          44.3   43.5
Other                       28         -       28      23          13.1   10.7
Total                      266       267      533     591          23.2   23.4
^1 gross rents plus, where rent reviews are outstanding, any increases to ERV
(as determined by the Group's external valuers), less any grounds rents
payable under head leases, excludes contracted rent subject to rent free and
future uplift
^2 Office average rent £psf is based on office space only.

Rent Subject to Open Market Rent Review
12 months to 30 September       2013 2014 2015 2016 2017 2013-15 2013-17
                                  £m   £m   £m   £m   £m      £m      £m
Retail parks                      28   20   18   26   17      66     109
Superstores                        3    9   24   13    4      36      53
Shopping centres                   9    9   15   12   12      33      57
Department stores                  1    -    -    5    -       1       6
UK Retail                         41   38   57   56   33     136     225
Europe Retail                      -    -    -    -    -       -       -
All Retail                        41   38   57   56   33     136     225
City                               8   37   26    5   13      71      89
West End                           6    2   13    4    9      21      34
Provincial                         -    -    1    5    -       1       6
All Offices                       14   39   40   14   22      93     129
Other                              -    -    -    -    -       -       -
Total                             55   77   97   70   55     229     354
Potential uplift at current ERV    2    1    2    1    -       5       6

Rent Subject to Lease Break or Expiry
At 30 September                 2013 2014 2015 2016 2017 2013-15 2013-17
                                  £m   £m   £m   £m   £m      £m      £m
Retail parks                       5    4    8    7    9      17      33
Superstores                        -    -    -    -    -       -       -
Shopping centres                   8    3    5    7   10      16      33
Department stores                  -    -    -    -    -       -       -
UK Retail                         13    7   13   14   19      33      66
Europe Retail                      4    3    3    2    4      10      16
All Retail                        17   10   16   16   23      43      82
City^1                             3    1    1   18    5       5      28
West End                           2    1    4    1   14       7      22
Provincial                         -    -    -    -    -       -       -
All Offices^1                      5    2    5   19   19      12      50
Other                              1    -    -    -    -       1       1
Total^1                           23   12   21   35   42      56     133
% of contracted rent            3.7% 1.9% 3.5% 5.7% 6.7%    9.1%   21.5%
Potential uplift at current ERV    2    1    1    2  (2)       4       4

Lease Length & Occupancy
At 30 September 2012         Average      Occupancy rate %
                              lease length yrs
(excluding developments)      To expiry   To break    Occupancy      Occupancy
Retail parks                       10.3        9.4         97.8           98.3
Superstores                        15.7       15.7        100.0          100.0
Shopping centres                    9.9        9.3         95.8           96.7
Department stores                  29.1       25.5        100.0          100.0
UK Retail                          12.7       11.8         97.8           98.3
Europe Retail                      10.5        4.3         87.1           87.2
All Retail                         12.6       11.4         97.2           97.6
City                               11.2        9.3       94.9^2         95.9^2
West End                           10.3        8.0         96.8           97.6
Provincial                          9.8        9.4        100.0          100.0
All Offices                        10.9        8.9       95.7^2         96.6^2
Other                              21.8       21.8         99.0           99.0
UK Total                           12.5       11.3       97.1^2         97.7^2
Total                              12.4       11.1       96.7^2         97.3^2
^1 including accommodation under offer or subject to asset management
^2 including 199 Bishopsgate (development which reached practical completion
immediately prior to the period end). When excluded occupancy (overall) for
All Offices and UK Total is 98.3%, portfolio total 97.9%.

Major Assets
At 30 September 2012                   BL Share Sq ft    Rent Occupancy  Lease
(excluding developments)                      %  '000 £m pa^1  rate %^2 length
Broadgate, London EC2                        50 4,009     174      94.7    8.1
Regent's Place, London NW1                  100 1,210      49      96.9    8.4
Meadowhall Shopping Centre, Sheffield        50 1,374      82      98.8    9.1
Tesco Superstores                            50 2,659      60     100.0   15.6
Sainsburys Superstores                       50 2,905      67     100.0   16.2
Ropemaker Place, London EC2                 100   593      27     100.0   13.8
Teesside Shopping Park,                     100   451      15     100.0    7.9
Drake Circus Shopping Centre,               100   570      15      96.9    7.4
Debenhams, Oxford Street                    100   363      16     100.0   26.5
York House, London W1                       100   132       5     100.0    5.1
Glasgow Fort Shopping Park                   41   442      16      98.7    7.2
St Stephens Shopping Centre, Hull           100   410       9      99.1    7.9
^1 annualised contracted rent including 100% of Joint
Ventures & Funds
^2 includes accommodation under offer or subject to
asset management
^3 to first break

Occupiers Representing over 0.5% of Rent
At 30 September 2012             % of total                         % of total
                                       rent                               rent
Tesco plc                               7.0  New Look                      0.9
Sainsbury Group                         6.0  TJX Cos Inc                   0.9
Debenhams                               4.2  Aegis Group                   0.9
UBS AG                                  3.6  JPMorgan Chase Bank           0.9
Home Retail Group                       2.9  Reed Smith LLP                0.8
Government                              2.3  Cable & Wireless plc          0.8
Kingfisher (B&Q)                        2.2  Gazprom                       0.8
Virgin Active                           2.0  Deutsche Bank AG              0.8
Next plc                                2.0  Mayer Brown                   0.8
Arcadia Group                           2.0  Comet Group                   0.7
Spirit Group                            1.7  SportsDirect                  0.7
Bank of Tokyo-Mitsubishi UFJ
Ltd                                     1.6  Mothercare                    0.7
Macquarie Group Limited                 1.5  ICAP Plc                      0.7
Asda Group                              1.5  Lend Lease                    0.7
DSG International                       1.4  Markit Group                  0.6
Herbert Smith                           1.4  Hennes                        0.6
Alliance Boots                          1.3  Credit Lyonnais               0.6
The Royal Bank of Scotland
plc                                     1.2  JD Sports                     0.6
Marks and Spencer Plc                   1.2  Pets at Home                  0.6
Hutchison Wh                            1.1  Henderson                     0.6
House of Fraser                         1.0  Carlson                       0.5

Committed Developments
               BL Sq ft       PC Current  Cost to Notional  ERV Pre-let    Resi
            Share       Calendar   Value complete interest                  End
                %  '000    Year      £m     £m^1   £m^1,2 £m^3      £m      £m
5 Broadgate    50   700  Q4 2014     139      123       22 19.2    19.2       -
Leadenhall     50   610  Q2 2014     121      104       17 18.6     5.6       -
Regents       100   500  Q2 2013     288       68        8 19.6     9.4     113
10 Portman    100   134  Q2 2013     101       25        2  9.0     2.1       -
Marble Arch   100    86  Q4 2013      33       27        3  3.9      -      15
39 Victoria   100    92  Q3 2013      42       23        3  4.9      -       -
Total             2,122              724      370       55 75.2    36.3     128
Village,       50   317  Q2 2013      16       16        2  2.4     1.9       -
Fort           41    46  Q3 2013       3        3        -  0.5     0.5       -
Hereford^8    100   310  Q2 2014       -       79        8  5.3     2.4       -
Total               673               19       98       10  8.2     4.8       -
Total                62               49       22        4   -      -      91
Total             2,857              792      490       69 83.4    41.1     219
Data includes Group's share of properties in Joint Ventures & Funds (except
area which is shown at 100%)
^1 from 1 October 2012 to practical completion (PC)
^2 based on a notional cost of finance of 6%
^3 estimated headline rental value net of rent payable under head leases
(excluding tenant incentives)
^4 parts of residential development expected to be sold, no rent allocated - of
which £97 million completed or exchanged
^5 includes 126,000 sq ft of residential
^6 excludes 25,000 sq ft of off-site residential and retail (95-99 Baker
Street), which was sold in the previous financial year. Also adjusted for
lettings agreed post period end
^7 includes 10,000 sq ft of residential
^8 Hereford was acquired post half end, the information is therefore management

Prospective Developments
At 30 September 2012        Sector    BL Share Sq ft
Colmore Row, Birmingham     Office         100   284 Detailed planning consent
Glasgow Fort                Retail          41   170 Detailed planning consent
Surrey Quays                Retail          50   100 Detailed planning consent
Fort Kinnaird, Edinburgh    Retail          21   110 Planning submitted
Broughton Park, Chester     Retail          41    55 Planning submitted
Meadowhall Surrounding Land Retail          50    47 Planning submitted
Power Court, Luton          Retail         100   200 Planning pending
Superstores extensions      Retail          50    31 Planning pending
Clarges House               Mixed use      100   191 Feasibility
Total Prospective                              1,188


Annualised rent  is the  gross  rent receivable  on a  cash  basis as  at  the 
reporting date. Additionally where rent reviews are outstanding, any increases
to applicable estimated rental  value (as determined  by the Group's  external 
valuers), less any ground rents payable under head leases.

BREEAM  (Building  Research  Establishment  Environmental  Assessment  Method) 
assesses the sustainability of buildings against a range of criteria.

CACI Ltd  is  a  wholly  owned  subsidiary  of  Consolidated  Analysis  Center 
Incorporated (CACI) providing marketing solutions and informational systems to
local and  central  Government and  to  business from  most  industry  sectors 
(including retail).

Capital return  is  calculated  as the  change  in  capital value  of  the  UK 
portfolio, less any capital expenditure incurred, expressed as a percentage of
capital employed over the  period, as calculated by  IPD. Capital returns  are 
calculated monthly and indexed to provide a return over the relevant period.

Capped rents are subject to  a maximum level of  uplift at the specified  rent 
reviews as agreed at the time of letting.

Collar rents are subject to  a minimum level of  uplift at the specified  rent 
reviews as agreed at the time of letting.

CRC Energy  Efficiency  Scheme  (previously  known  as  the  Carbon  Reduction 
Commitment) is the UK Government's  new mandatory scheme for carbon  emissions 
reporting and pricing.

Credit  rating  A   rating  from  an   independent  institution  that   assess 
creditworthiness or the  credit risk, and  provides publicly available  credit 
ratings used  by investors  as well  as  analysts as  a guide  for  investment 
decisions in regard to relative credit standing or strength. British Land  are 
assessed by the credit  rating agency Fitch. Other  examples of credit  rating 
agencies are Standard & Poor's and Moody's Investor Service.

Developer's profit  is  the profit  on  cost  estimated by  the  valuers.  The 
developers profit is typically calculated by the valuers to be a percentage of
the estimated total  development costs,  including land  and notional  finance 

Development uplift is the total increase in the value (after taking account of
capital  expenditure  and  capitalised   interest)  of  properties  held   for 
development during  the  period.  It  also  includes  any  developer's  profit 
recognised by valuers in the period.

Development construction cost is the total  cost of construction of a  project 
to completion,  excluding site  values and  finance costs  (finance costs  are 
assumed by the valuers at a notional rate of 6% per annum).

EPRA is the  European Public Real  Estate Association, the  industry body  for 
European REITs.

EPRA Net Initial  Yield is the  annualised rents generated  by the  portfolio, 
after the deduction of an estimate of annual recurring irrecoverable  property 
outgoings, expressed  as  a  percentage of  the  portfolio  valuation  (adding 
notional purchaser's costs), excluding development properties.

EPRA earnings  is  the profit  after  taxation excluding  investment  property 
revaluations and  gains/losses on  disposals, intangible  asset movements  and 
their related taxation.

EPRA NAV per share is EPRA NAV divided by the diluted number of shares at  the 
period end.

EPRA net assets (EPRA NAV) are the balance sheet net assets excluding the mark
to market on effective cash flow hedges and related debt adjustments, deferred
taxation  on  revaluations  and  diluting  for  the  effect  of  those  shares 
potentially issuable under employee share schemes.

EPRA NNNAV is  the EPRA NAV  adjusted to reflect  the fair value  of debt  and 
derivatives and to include deferred taxation on revaluations.

EPRA 'topped-up' Net Initial  Yield is the annualised  rents generated by  the 
portfolio,  after  the   deduction  of   an  estimate   of  annual   recurring 
irrecoverable  property  outgoings,  plus  rent  contracted  from  expiry   of 
rent-free periods and uplifts agreed at  the balance sheet date which are  not 
intended to compensate for future inflation, expressed as a percentage of  the 
portfolio valuation (adding notional purchaser's costs), excluding development

EPRA vacancy rate is the estimated  market rental value (ERV) of vacant  space 
divided by ERV  of the whole  portfolio, excluding developments.  This is  the 
inverse of the occupancy rate.

Estimated rental value (ERV) is the  external valuers' opinion as to the  open 
market rent which, on the date  of valuation, could reasonably be expected  to 
be obtained on a new letting or rent review of a property.

Estimated (Net) Development Value is the estimated end value of a  development 
project as  determined  by the  external  valuers  for when  the  building  is 
completed and fully let  (taking into account  tenant incentives and  notional 
purchasers costs). It is  based on the valuers  view on ERVs, yields,  letting 
voids and rent-frees.

Fair value is the estimated amount for which a property should exchange on the
valuation date between a willing buyer and a willing seller in an arm's length
transaction  after  proper  marketing  and   where  parties  had  each   acted 
knowledgeably, prudently and without compulsion.

Fair value movement An  accounting adjustment to change  the book value of  an 
asset or liability to its market value.

Gearing see Loan to Value (LTV).

Gross rental income is the gross accounting rent receivable (quoted either for
the period or on an annualised basis) prepared under IFRS which requires  that 
rental income from fixed/minimum guaranteed rent reviews and tenant incentives
is spread on a straight-line basis over the entire lease to first break.  This 
can result in income being recognised ahead of cash flow.

Gross  Value  Added  (GVA)  provides   a  snapshot  of  a  company's   overall 
contribution  to  the  UK  economy,  both  directly  through  activities   and 
indirectly through spending.

Group is The British  Land Company PLC and  its subsidiaries and excludes  its 
share  of  joint  ventures  and  funds  on  a  line-by-line  basis  (i.e.  not 
proportionally consolidated).

Headline rent is the  contracted gross rent  receivable which becomes  payable 
after all the tenant incentives in the letting have expired.

IFRS are the  International Financial  Reporting Standards as  adopted by  the 
European Union.

Income return is calculated as net income expressed as a percentage of capital
employed over the period, as calculated by IPD.

Interest cover  is the  number of  times net  interest payable  is covered  by 
underlying profit before net interest payable and taxation.

IPD  is  Investment  Property  Databank  Ltd  which  produces  an  independent 
benchmark of property returns.

Key performance indicators (KPIs) Activities  and behaviours, aligned to  both 
business objectives and  individual goals,  against which  the performance  of 
Land Securities employees is  annually assessed. Performance measured  against 
them is referenced in the Annual Report.

Lettings and Lease  Renewals are  divided between  short term  (less than  two 
years lease length) and long-term (over two years lease length). Lettings  and 
renewals are compared both to the previous passing rent as at the start of the
financial year; and the ERV immediately prior to letting. Both comparisons are
made on a net effective basis.

Like-for-like ERV growth is the  change in ERV over  a period on the  standing 
investment properties expressed as a percentage of the ERV at the start of the
period. Like-for-like ERV growth is calculated monthly and compounded for  the 
period subject to measurement.

Like-for-like rental income  growth is the  growth in gross  rental income  on 
properties owned throughout  the current  and previous  periods under  review. 
This growth rate includes revenue recognition and lease accounting adjustments
but excludes properties held for development in either period, properties with
guaranteed  rent  reviews,  asset  management  determinations  and   surrender 

Loan to Value (LTV) is the ratio  of principal value of gross debt less  cash, 
short-term  deposits  and  liquid  investments  to  the  aggregate  value   of 
properties and investments.

Mark-to-market is  the  difference between  the  book  value of  an  asset  or 
liability and its market value.

Net effective rent is the contracted gross rent receivable taking into account
any rent-free period or other tenant incentive. The incentives are treated  as 
a cost to rent and spread over the lease to the earliest termination date.

Net Equivalent  Yield  (NEY) is  the  weighted average  income  return  (after 
allowing for notional purchaser's  costs) a property  will produce based  upon 
the timing of  the income  received. In  accordance with  usual practice,  the 
equivalent yields  (as determined  by  the external  valuers) assume  rent  is 
received annually in arrears.

Net Initial Yield (NIY)  is the annualised rents  generated by the  portfolio, 
after the deduction of an estimate of annual recurring irrecoverable  property 
outgoings, expressed  as  a  percentage of  the  portfolio  valuation  (adding 
notional purchaser's costs), excluding development properties.

Net  operating  costs  are  property  operating  expenses  and  administrative 
expenses net of fees and other income.

Net rental income is the rental income receivable in the period after  payment 
of direct property outgoings w

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