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British Land Raises Dividend as Economy Begins to Recover

July 24 (Bloomberg) -- British Land Co., the U.K.’s second-largest real estate investment trust by market value, increased its dividend for the fiscal first quarter by 2.3 percent and said it’s confident about future profit growth.

British Land will pay 6.75 pence a share for the three months through June, the London-based company said in a statement today. Shareholders received 6.60 pence a year earlier.

“The economy as a whole is showing some signs of returning confidence,” Chief Executive Officer Chris Grigg said in the statement. “London remains strong and while retail is still challenging, we continue to see encouraging levels of demand for our space.”

British Land raised 493 million pounds ($758 million) in a share sale in March. This year, the company has made 512 million pounds of acquisitions, including the 470 million-pound purchase of offices, stores and land near Paddington Station earlier this month.

The developer, whose share price is up about 10 percent this year, will build 463 homes, a 160-room hotel, office space and stores at Aldgate Place on the eastern fringe of the City of London financial district in a venture with Barratt Developments Plc, the Leicestershire, England-based homebuilder said in a separate statement today. The site was bought from a unit of Tishman Speyer Properties LP last year, subject to planning being granted for a residential-focused development.

British Land signed leases with office occupiers at an average of 5.3 percent above its estimates and signed new deals with retailers for stores at rents that averaged 3.6 percent above estimates, according to the company’s statement.

The company may sell some of its shopping malls to take advantage of increased demand from investors for assets that aren’t in prime locations, Grigg said in a call with reporters. It’s also bidding for other retail centers, he said.

To contact the reporter on this story: Neil Callanan in London at ncallanan@bloomberg.net

To contact the editor responsible for this story: Andrew Blackman at ablackman@bloomberg.net

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