Final Results - Part 3

RNS Number : 3584F

British Land Co PLC

17 May 2017

 



SUPPLEMENTARY TABLES

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

From 1 April 2016					Price (Gross)		Price       (BL Share)		Annual Passing Rent
Acquisitions		Sector			£m		£m		£m4
Completed
New George Street Estate, Plymouth		Retail			64		64		5
10-40 The Broadway, Ealing1		Retail			49		49		2
Harlech, Newport - Tesco exchange2		Retail			41		20		1
Tesco, Brislington - Tesco exchange2		Retail			46		23		2
Hercules Unit Trust unit purchase3		Retail			18		18		1
Teesside Leisure Park		Retail			13		13		1
Dock Offices		Canada Water			8		8		-
Total					239		195		12
1  Property acquisition exchanged and completed post year end
2 Property acquisitions exchanged and completed post year end as part of a Tesco JV swap transaction resulting in a net £73m disposal of superstore assets
3 Units purchased over the course of the year. £18m represents purchased GAV
4 BL share of annualised rent topped up for rent frees
From 1 April 2016					Price (Gross)		Price        (BL Share)			Annual Passing Rent
Disposals		Sector			£m		£m			£m3
Completed
Debenhams, Oxford Street		Retail			400		400			13
Superstores1		Retail			410		226			12
Portfolio of retail assets (Debenhams Manchester, York Clifton Moor, Wakefield Westgate)		Retail			191		191			12
Ebury Gate		Offices			34		34			2
Dumfries Cuckoo Bridge		Retail			20		20			1
56 - 70 Putney High Street		Retail			20		20			1
Lisnagelvin, Londonderry		Retail			15		15			1
Luton Power Court		Retail			9		9			-
The Hempel Collection		Residential			14		14			-
Aldgate Place		Residential			46		23			-
Exchanged2
The Leadenhall Building		Offices			1,150		575			17
Clarges, Mayfair		Residential			19		19			-
Total					2,328		1,546			59
1 Of which £116m (BL share) exchanged and completed post year end as part of a Tesco JV swap transaction resulting in a net £73m disposal of superstore assets
2 Sales completing post year end
3 BL share of annualised rent topped up for rent frees
Portfolio Valuation1
At 31 March 2017	Group		JVs & Funds	Total				Change %²
	£m		£m	£m		H1		H2			FY
Regional Lifestyle	1,120		1,834	2,954		(2.8)		1.0			(1.8)
Local Lifestyle	1,671		477	2,148		(4.8)		0.4			(4.5)
Multi-lets	2,791		2,311	5,102		(3.7)		0.7			(3.0)
Department Stores & Leisure	574		1	575		3.2		3.1			5.1
Superstores	106		526	632		(3.0)		(2.5)			(5.2)
Solus/Other	345		-	345		3.7		1.8			5.5
Retail & Leisure	3,816		2,838	6,654		(2.4)		0.7			(1.8)
West End	3,960		-	3,960		(2.4)		1.7			(0.6)
City	108		2,776	2,884		(4.9)		4.4			(0.8)
Offices	4,068		2,776	6,844		(3.5)		2.8			(0.7)
Residential3	156		15	171		-		5.4			4.2
Offices & Residential	4,224		2,791	7,015		(3.3)		2.9			(0.5)
Canada Water	271		-	271		(2.1)		(9.0)			(10.8)
Total	8,311		5,629	13,940		(2.8)		1.6			(1.4)
Standing Investments	7,821		5,487	13,308		(2.8)		1.3			(1.6)
Developments	490		142	632		(3.0)		4.8			1.7
1 On a proportionally consolidated basis including the Group's share of joint ventures and funds
2 Valuation movement during the year (after taking account of capital expenditure) of properties held at the balance sheet date, including developments (classified by end use), purchases and sales
3 Stand-alone residential

Gross Rental Income1,2
Accounting Basis £m	12 months to 31 March 2017			Annualised as at 31 March 2017
	Group	JVs & Funds	Total	Group	JVs & Funds	Total
Regional Lifestyle	60	86	146	61	86	147
Local Lifestyle	98	27	125	88	26	114
Multi-lets	158	113	271	149	112	261
Department Stores & Leisure	48	-	48	38	-	38
Superstores	9	32	41	6	32	38
Solus/Other	20	-	20	20	-	20
Retail & Leisure	235	145	380	213	144	357
West End	129	-	129	125	-	125
City	5	116	121	4	104	108
Offices	134	116	250	129	104	233
Residential3	4	-	4	4	-	4
Offices & Residential	138	116	254	133	104	237
Canada Water	9	-	9	8	-	8
Total	382	261	643	354	248	602
1 Gross rental income will differ from annualised rents due to accounting adjustments for fixed & minimum contracted rental uplifts and lease incentives
2 On a proportionally consolidated basis including the Group's share of joint ventures and funds
3 Stand-alone residential

Portfolio Yield & ERV Movements1
At 31 March 2017	NEY3	ERV Growth %2						NEY Yield Movement bps3
	%	H1	H2		FY			H1		H2			FY
Regional Lifestyle	4.9	1.3%	1.0%		2.3%			16		(4)			12
Local Lifestyle	5.4	1.3%	1.2%		2.5%			29		(1)			27
Multi-lets	5.1	1.3%	1.1%		2.4%			22		(3)			18
Department Stores & Leisure	5.9	0.4%	(0.1%)		0.4%			4		(18)			(15)
Superstores	5.5	(3.0%)	(1.0%)		(4.0%)			8		13			21
Solus/Other	5.2	4.8%	0.0%		4.8%			9		(9)			(4)
Retail & Leisure	5.2	0.9%	0.7%		1.6%			18		(3)			14
West End	4.5	0.3%	0.4%		0.7%			16		(1)			15
City4	4.5	(0.2%)	0.4%		0.2%			27		(13)			15
Offices	4.5	0.1%	0.4%		0.5%			21		(6)			15
Canada Water	3.4	0.9%	(0.1%)		0.9%			4		5			9
Total	4.8	0.5%	0.6%		1.1%			19		(5)			15
1 On a proportionally consolidated basis including the Group's share of joint ventures and funds. Excluding committed developments and residential assets
2 As calculated by IPD
3 Including notional purchaser's costs
4 City NEY is 4.6% pro-forma for sale completion of our 50% interest in The Leadenhall Building which exchanged in the year

Retail Portfolio Valuation - Previous Classification Basis1
At 31 March 2017	Valuation	Change %²					ERV Growth %3						NEY Yield Movement bps
	£m	H1	H2		FY		H1	H2			FY		H1		H2			FY
Shopping Parks	3,167	(4.1)	0.7		(3.3)		1.6%	0.8%			2.4%		26		(4)			20
Shopping Centres	2,276	(2.1)	0.8		(1.3)		1.3%	1.3%			2.6%		14		(3)			12
Superstores	632	(3.0)	(2.5)		(5.2)		(3.0%)	(1.0%)			(4.0%)		8		13			21
Department Stores	166	5.6	3.0		6.7		0.4%	0.3%			0.7%		3		(10)			(8)
Leisure	413	(0.5)	3.2		2.7		0.4%	(0.2%)			0.2%		4		(21)			(17)
Retail & Leisure	6,654	(2.4)	0.7		(1.8)		0.9%	0.7%			1.6%		18		(3)			14
1 On a proportionally consolidated basis including the Group's share of joint ventures and funds
2 Valuation movement during the year (after taking account of capital expenditure) of properties held at the balance sheet date, including developments (classified by end use), purchases and sales
3 As calculated by IPD

Portfolio Net Yields1,2,3
At 31 March 2017	EPRA net initial yield %	EPRA topped up net initial yield %4	Overall topped up net initial yield %5	Net equivalent yield %	Net reversionary yield %
Regional Lifestyle	4.5	4.6	4.7	4.9	5.0
Local Lifestyle	5.1	5.2	5.3	5.4	5.4
Multi-lets	4.7	4.9	4.9	5.1	5.2
Department Stores & Leisure	6.0	6.0	7.2	5.9	4.4
Superstores	5.6	5.6	5.6	5.5	5.3
Solus/Other	5.6	5.6	5.6	5.2	4.8
Retail & Leisure	4.9	5.1	5.2	5.2	5.1
West End	3.5	3.7	3.8	4.5	4.8
City6	3.7	4.1	4.1	4.5	5.1
Offices	3.6	3.9	3.9	4.5	4.9
Canada Water	2.8	2.9	2.9	3.4	3.5
Total	4.3	4.5	4.6	4.8	5.0
1 On a proportionally consolidated basis including the Group's share of joint ventures and funds
2 Including notional purchaser's costs
3 Excluding committed developments and residential assets
4 Including rent contracted from expiry of rent-free periods and fixed uplifts not in lieu of rental growth
5 Including fixed/minimum uplifts (excluded from EPRA definition)
6 City net equivalent yield is 4.6% and EPRA net initial yield is 4.2% pro-forma for sale completion of our 50% interest in The Leadenhall Building which exchanged in the year

Portfolio Net Yields1,2,3 - Previous Classification Basis
At 31 March 2017	EPRA net initial yield %	EPRA topped up net initial yield %4	Overall topped up net initial yield %5	Net equivalent yield %	Net reversionary yield %
Shopping parks	4.9	5.1	5.1	5.2	5.2
Shopping centres	4.5	4.7	4.7	5.0	5.1
Superstores	5.6	5.6	5.6	5.5	5.3
Department stores	5.1	5.1	6.6	5.0	3.9
Leisure	6.3	6.3	7.4	6.2	4.7
Retail & Leisure	4.9	5.1	5.2	5.2	5.1
1 On a proportionally consolidated basis including the Group's share of joint ventures and funds
2 Including notional purchaser's costs
3 Excluding committed developments
4 Including rent contracted from expiry of rent-free periods and fixed uplifts not in lieu of rental growth
5 Including fixed/minimum uplifts (excluded from EPRA definition)

Total Property Return (as calculated by IPD)1
Full Year to 31 March 2017	Retail		Offices		Total
%	British Land	IPD	British Land	IPD	British Land	IPD
Capital Return	(1.7)	(2.3)	(0.6)	(1.0)	(1.2)	(0.1)
- ERV Growth	1.6	0.9	0.5	2.0	1.1	1.9
- Yield Expansion2	14 bps	12 bps	15 bps	13 bps	15 bps	4 bps
Income Return	5.3	5.1	3.5	3.8	4.3	4.7
Total Property Return	3.5	2.8	2.8	2.8	3.1	4.6
1 On a proportionally consolidated basis including the Group's share of joint ventures and funds
2 Net equivalent yield movement

Occupiers Representing over 0.5% of Total Contracted Rent1
At 31 March 2017	% of total rent			% of total rent
Tesco plc2	5.4		Vodafone	0.9
J Sainsbury plc	4.8		Asda Group	0.9
UBS AG	3.4		Aon Plc	0.9
Debenhams	3.3		SportsDirect	0.9
Kingfisher (B&Q)	2.8		Microsoft	0.9
HM Government	2.6		JD Sports	0.8
Next plc	2.4		Deutsche Bank	0.8
Virgin Active	1.9		Reed Smith	0.8
Facebook	1.8		H&M	0.7
Dentsu Aegis	1.7		Mayer Brown	0.7
Spirit Group	1.7		Mothercare	0.7
M&S plc	1.6		TGI Fridays	0.6
Wesfarmers (Homebase/Bunnings)	1.6		ICAP Plc	0.6
Alliance Boots	1.6		River Island	0.6
Visa Inc	1.5		MS Amlin Plc	0.6
Dixons Carphone	1.4		Credit Agricole	0.6
Arcadia Group	1.3		Pets at Home	0.5
Herbert Smith	1.3		Henderson	0.5
RBS	1.2		Primark	0.5
TK Maxx	1.0		Aramco	0.5
Gazprom	1.0		House of Fraser	0.5
New Look	1.0		Steinhoff	0.5
1 On a proportionally consolidated basis including the Group's share of joint ventures and funds 2 4.7% pro-forma for post year end net disposal of £73m in a Tesco JV swap transaction

Major Holdings
At 31 March 2017	BL Share	Sq ft		Rent		Occupancy		Lease
	%	'000		£m pa1		rate %2		length yrs3
Broadgate	50	4,850		190		98.3		8.2
Regent's Place	100	1,590		76		99.1		7.4
Paddington Central	100	958		33		94.1		6.8
Meadowhall, Sheffield	50	1,500		84		97.9		6.4
The Leadenhall Building4	50	603		40		99.9		10.3
Sainsbury's Superstores5	51	2,184		48		100.0		10.4
Teesside, Stockton6	100	569		17		96.9		5.6
Drake's Circus, Plymouth7	100	1,132		21		95.9		8.9
Glasgow Fort	77	510		21		98.3		5.9
Ealing Broadway	100	470		13		93.7		5.9
1 Annualised EPRA contracted rent including 100% of Joint Ventures & Funds
2 Including accommodation under offer (including post year transactions at 2 Finsbury Avenue and 4 Kingdom Street) or subject to asset management (incl. space being prepared for flexible working) or assets being readied for development in the near term (1 Finsbury Avenue)
3 Weighted average to first break
4 Sale exchanged in March 2017 with completion due post year end
5 Comprises stand-alone stores
6 Includes Teesside Leisure Park acquired in the year
7 Includes New George Street Estate, Plymouth acquired during the year

Lease Length & Occupancy1
At 31 March 2017	Average lease length yrs			Occupancy rate %
	To expiry	To break		EPRA Occupancy	Occupancy2
Regional Lifestyle	7.9	6.7		97.3	97.7
Local Lifestyle	7.9	6.8		97.3	97.9
Multi-lets	7.9	6.8		97.3	97.8
Department Stores & Leisure	17.4	17.4		99.8	99.8
Superstores	11.7	11.3		100.0	100.0
Solus/Other	12.5	12.3		100.0	100.0
Retail & Leisure	9.5	8.6		97.9	98.3
West End	9.0	7.3		93.0	97.0
City3	9.8	8.5		91.1	98.6
Offices	9.4	7.8		92.1	97.7
Canada Water	6.8	6.5		97.6	98.8
Total	9.4	8.3		95.2	98.0
1 On a proportionally consolidated basis including the Group's share of joint ventures and funds
2 Including accommodation under offer (including post year transactions at 2 Finsbury Avenue and 4 Kingdom Street) or subject to asset management (incl. space being prepared for flexible working) or assets being readied for development in the near term (1 Finsbury Avenue)
3 City average lease length to break is 8.2 yrs pro-forma for completion of the sale of our 50% interest in The Leadenhall Building
Portfolio Weighting1
At 31 March		2016		2017	2017	2017
				(current)	(current)	(pro-forma2)
		%		%	£m	%
Regional Lifestyle		19.4		21.3	2,954	21.6
Local Lifestyle		16.3		15.4	2,148	16.1
Multi-lets		35.7		36.7	5,102	37.7
Department Stores & Leisure		6.9		4.1	575	4.2
Superstores		5.3		4.5	632	3.9
Solus/Other		2.3		2.5	345	2.5
Retail & Leisure		50.2		47.8	6,654	48.3
West End		26.6		28.4	3,960	29.8
City		19.7		20.7	2,884	18.7
Offices		46.3		49.1	6,844	48.5
Residential3		1.6		1.2	171	1.2
Offices & Residential		47.9		50.3	7,015	49.7
Canada Water		1.9		1.9	271	2.0
Total		100.0		100.0	13,940	100.0
Of which London		58%		58%	8,050	58%
1 On a proportionally consolidated basis including the Group's share of joint ventures and funds
2 Pro forma for developments under construction and committed developments at estimated end value (as determined by the Group's external valuers) and post year end transactions including the expected completion of the sale of our 50% interest in The Leadenhall Building and the Tesco JV swap transaction
3 Stand-alone residential

Annualised Rent & Estimated Rental Value (ERV)1
At 31 March 2017			Annualised rent (valuation basis) £m2				ERV £m	Average rent £psf
			Group	JVs & Funds		Total	Total	Contracted3			ERV
Regional Lifestyle			61	87		148	164	31.1			33.1
Local Lifestyle			90	28		118	126	24.9			26.1
Multi-lets			151	115		266	290	28.0			29.6
Department Stores & Leisure			36	-		36	28	14.9			11.4
Superstores			6	32		38	36	21.3			20.1
Solus/Other			20	-		20	17	19.8			17.0
Retail & Leisure			213	147		360	371	24.5			24.6
West End4			132	-		132	179	54.2			62.2
City4,5			4	103		107	150	52.5			60.2
Offices4			136	103		239	329	53.4			61.2
Residential6			4	-		4	4
Offices & Residential			140	103		243	333
Canada Water			8	-		8	10	16.4			21.0
Total			361	250		611	714	30.3			33.2
1 On a proportionally consolidated basis including the Group's share of joint ventures and funds
2 Gross rents 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, excludes contracted rent subject to rent free and future uplift
3 Annualised rent, plus rent subject to rent free
4 £psf metrics shown for office space only
5 City average rent psf  on a contracted basis is £50.1 and on an ERV basis is £57.4 pro-forma for completion of the sale of our 50% interest in The Leadenhall Building.
6 Stand-alone residential
Rent Subject to Open Market Rent Review1
At 31 March 2017		2018	2019		2020	2021		2022		2018-20	2018-22
For year to 31 March		£m	£m		£m	£m		£m		£m	£m
Regional Lifestyle		13	17		12	18		13		42	73
Local Lifestyle		24	17		10	11		6		51	68
Multi-lets		37	34		22	29		19		93	141
Department Stores & Leisure		-	-		-	-		-		-	-
Superstores		4	7		10	12		3		21	36
Solus/Other		-	-		-	-		-		-	-
Retail & Leisure		41	41		32	41		22		114	177
West End		24	20		15	10		9		59	78
City		4	14		14	15		1		32	48
Offices		28	34		29	25		10		91	126
Canada Water		1	1		-	-		-		2	2
Total		70	76		61	66		32		207	305
1 On a proportionally consolidated basis including the Group's share of joint ventures and funds

Rent Subject to Lease Break or Expiry1
At 31 March 2017	2018	2019	2020	2021	2022	2018-20	2018-22
For year to 31 March	£m	£m	£m	£m	£m	£m	£m
Regional Lifestyle	19	10	14	10	15	43	68
Local Lifestyle	8	7	10	9	11	25	45
Multi-lets	27	17	24	19	26	68	113
Department Stores & Leisure	-	-	-	-	-	-	-
Superstores	-	-	-	-	-	-	-
Solus/Other	-	1	-	-	-	1	1
Retail & Leisure	27	18	24	19	26	69	114
West End	6	10	3	17	21	19	57
City	7	11	11	9	2	29	40
Offices	13	21	14	26	23	48	97
Canada Water	1	1	-	1	-	2	3
Total	41	40	38	46	49	119	214
% of contracted rent	6.3%	6.3%	6.0%	7.1%	7.7%	18.6%	33.4%
1 On a proportionally consolidated basis including the Group's share of joint ventures and funds

Superstores
	Stand-alone Superstores1					In Multi-let assets 2					Total Exposure1,2,3
Store Size '000 SQ FT	No of Stores	Valuation (BL share) £m		Capital Value psf	Lease length4	No of Stores		Valuation (BL share) £m	Capital Value psf	Lease length4	No of Stores	Valuation (BL share) £m		Capital Value psf		Lease length4
>100	6	152		340	11.1	4		286	419	11.1	10	438		388		11.1
75-100	10	171		384	11.3	3		73	274	15.0	13	244		342		12.5
50-75	12	179		364	10.8	-		-	-	-	12	179		364		10.8
25-50	3	15		272	8.1	3		32	456	18.5	6	47		375		14.7
0-25	2	6		138	8.1	21		98	465	10.2	23	104		409		10.0
March 2017	33	523		352	10.9	31		489	397	12.6	64	1,012		373		11.7
March 2016	47	763		383	13.9	28		537	482	12.7	75	1,301		419		13.5
Geographical Spread					Gross Rent (BL Share)						Lease Structure
London & South				58%	Tesco					£29m	RPI and Fixed					10%
Rest of UK				42%	Sainsbury's					£26m	OMRR					90%
					Other					£5m
Table reflects post year end disposals of £116m and purchase of £23m as part of a property exchange transaction with Tesco
1 Excludes £13m non-foodstore occupiers in superstore led assets
2 Excludes non-food format stores e.g. Asda Living
3 Excludes £93m of investments held for trading comprising freehold reversions in a pool of Sainsbury's Superstores
4 Weighted average lease length to first break

Recently Completed & Committed Developments1
At 31 March 17	Sector	BL Share	Sq ft	PC Calendar Year	Current Value	Cost to come	ERV	Let & Under Offer
		%	'000		£m2	£m3	£m4	£m
4 Kingdom Street	Office	100	147	Q2 2017	151	18	9.5	7.0
Clarges Mayfair - Offices	Office	100	51	Q2 2016	135	6	5.6	4.3
Glasgow Fort Leisure Quarter	Retail	77	12	Q3 2016	8	-	0.4	0.2
The Hempel Phase 1	Residential	100	25	Q4 2016	4	3	-	-
The Hempel Phase 2	Residential	100	33	Q4 2016	45	3	-	-
Aldgate Place Phase 1	Residential	50	221	Q2 2016	-	7	-	-
Total Completed in Year			489		343	37	15.5	11.5
100 Liverpool Street	Office	50	520	Q4 2019	112	152	18.6	-
Speke (Leisure)	Retail	67	66	Q2 2018	4	14	1.2	0.8
Clarges Mayfair - Retail and Residential5	Mixed Use	100	104	Q4 2017	362	52	0.8	-
Total Committed			690		478	218	20.6	0.8
Retail Capex 6						111
1 On a proportionally consolidated basis including the Group's share of joint ventures and funds (except area which is shown at 100%)
2 Excludes completed sales of £120m
3 From 1 April 2017. Cost to come excludes notional interest as interest is capitalised individually on each development at our capitalisation rate
4 Estimated headline rental value net of rent payable under head leases (excluding tenant incentives)
5 Current value includes units exchanged and not completed of £278m
6 Capex committed and underway within our investment portfolio relating to leasing and asset management

Near Term Development Pipeline1
At 31 March 17	Sector	BL Share	Sq ft	Expected Start On Site	Current Value	Cost to Come	ERV	Status
		%	'000		£m	£m2	£m3
135 Bishopsgate	Office	50	325	2017	107	55	9.4	Submitted
1 Triton Square	Office	100	366	2018	161	200	23.3	Resolution to grant
1 Finsbury Avenue	Office	50	288	2017	77	35	7.7	Submitted
Plymouth (Leisure)	Retail	100	104	2018	-	48	3.1	Consented
Total Near-Term			1,083		345	338	43.5
Retail Capex4						75
1 On a proportionally consolidated basis including the Group's share of joint ventures and funds (except area which is shown at 100%)
2 From 1 April 2017. Cost to come excludes notional interest as interest is capitalised individually on each development at our capitalisation rate
3 Estimated headline rental value net of rent payable under head leases (excluding tenant incentives)
4 Forecast capital commitments within our investment portfolio over the next 12 months relating to leasing and asset enhancement

Medium Term Development Pipeline
At 31 March 17	Sector	BL Share %	Sq ft	Status
			'000
2-3 Finsbury Avenue	Office	50	563	Consented
1-2 Broadgate	Office	50	375	Pre-submission
Blossom Street	Office	100	340	Consented
5 Kingdom Street1	Office	100	332	Consented
Gateway Building	Office	100	105	Pre-submission
Meadowhall (Leisure)	Retail	50	322	Submitted
Peterborough (Leisure)	Retail	100	182	Pre-submission
Teesside (Leisure)	Retail	100	80	Pre-submission
Bradford (Leisure)	Retail	100	49	Pre-submission
Aldgate Place Phase 2	Resi	50	145	Consented
Eden Walk Retail & Residential	Mixed Use	50	538	Consented
Total Medium Term excl. Canada Water			3,031
Canada Water2	Mixed Use	100	5,500	Pre-submission
1  Planning consent for previous 240,000 sq ft scheme
2 Assumed net area based on gross area of up to 7m sq ft

Residential development programme1
At 31 March 2017	BL Share	Sq Ft	Total No. Units	No. Units to sell	PC Date	Current Value2	Cost To Come3	Sales Exchanged & not Completed2,4	Value to sell
	%	'000				£m	£m	£m	£m
Clarges Mayfair	100	94	34	11	Q4 2017	347	52	278	150
The Hempel Phase 1	100	25	15	1	Q4 2016	4	3	-	7
The Hempel Phase 2	100	33	18	13	Q4 2016	45	3	-	46
Aldgate Place Phase 1	50	221	154	1	Q2 2016	-	7	-	7
Total Committed Residential		373	221	26		396	65	278	210
1 On a proportionally consolidated basis including the Group's share of joint ventures and funds (except area which is shown at 100%)
2 Excludes completed sales of £120m
3 From 1 April 2017. Cost to come excludes notional interest as interest is capitalised individually on each development at our capitalisation rate
4 At agreed sales price

GLOSSARY

Adjusted net debt is the Group net debt and the Group's share of joint venture and funds' net debt excluding the mark-to-market on effective cash flow hedges and related debt adjustments and non-controlling interests. A reconciliation between Group net debt and adjusted net debt is included in table A within the supplementary disclosures.

AGM is the Annual General Meeting of The British Land Company plc. The 2017 AGM will be held on 18 July 2017 at The Hyatt Regency London - The Churchill, 30 Portman Square, London W1H 7BH commencing at 11.00am.

Annualised rent is the gross property rent receivable on a cash basis as at the reporting date. Additionally, it includes the external valuers' estimate of additional rent in respect of unsettled rent reviews, turnover rent and sundry income such as that from car parks and commercialisation, less any ground rents payable under head leases.

Assets under management is the full value of all assets owned and managed by British

Land and includes 100% of the value of all assets owned by joint ventures and funds.

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

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

Contracted rent is the annualised rent adjusting for the inclusion of rent subject to rent free periods.

Customer satisfaction combines survey results on overall experience ratings from decision makers, property directors, store managers and visitors across our retail and office businesses.

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

Development 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 5% per annum).

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

Dividend yield is calculated as dividends per share expressed as a percentage of EPRA NAV per share.

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

EPRA cost ratio (including direct vacancy costs) is a proportionally consolidated measure of the ratio of net overheads and operating expenses against gross rental income (with both amounts excluding ground rents payable). Net overheads and operating expenses relate to all administrative and operating expenses, net of any service fees, recharges or other income specifically intended to cover overhead and property expenses.

EPRA cost ratio (excluding direct vacancy costs) is the ratio calculated above, but with direct vacancy costs removed from the net overheads and operating expenses balance.

EPRA earnings is the IFRS profit after taxation attributable to shareholders of the Company excluding investment and development property revaluations, gains/losses on investing and trading property disposals, changes in the fair value of financial instruments and associated close-out costs and their related taxation. These items are presented in the capital and other column of the income statement. A reconciliation between profit attributable to shareholders of the Company and EPRA earnings is included in table B within the supplementary disclosures.

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

EPRA net asset value (EPRA NAV) is a proportionally consolidated measure, representing the IFRS net assets excluding the mark-to-market on effective cash flow hedges and related debt adjustments, the mark-to-market on the convertible bonds as well as deferred taxation on property and derivative valuations. It includes the valuation surplus on trading properties and is adjusted for the dilutive impact of share options. A reconciliation between IFRS net assets and EPRA NAV is included in table B within the Supplementary Disclosures.

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 and residential properties.

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

EPRA occupancy rate is the ERV of occupied space divided by ERV of the whole portfolio, excluding developments and residential property.

EPRA topped-up net initial yield is the current annualised rent, net of costs, topped up for contracted uplifts, where these are not in lieu of rental growth, expressed as a percentage of capital value (adding notional purchasers costs).

EPRA vacancy rate is the ERV of vacant space divided by ERV of the whole portfolio, excluding developments and residential property.

Estimated rental value (ERV) is the external valuers' opinion of 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.

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. ERV growth is calculated monthly and compounded for the period subject to measurement, as calculated by IPD.

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

Footfall is the estimated annualised number of visitors entering our assets.

Footfall growth is the like-for-like movement in footfall against the same period in the prior year, on properties owned throughout both comparable periods, aggregated at British Land's ownership share for each asset.

Gross investment activity as measured by our share of acquisitions, sales and capital expectations on investments and development.

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.

Group is The British Land Company PLC and its subsidiaries and excludes its share of joint ventures and funds (where not treated as a subsidiary) 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. Income returns are calculated monthly and indexed to provide a return over the relevant period.

Interest cover is the number of times net financing costs are covered by underlying profit before net financing costs and taxation.

IPD is a brand of real estate indices, owned by MSCI, which produce independent benchmarks of property returns and British Land UK portfolio returns.

Lettings and lease renewals are compared both to the previous passing rent as at the start of the financial year and the ERV immediately prior to letting. Letting performance against ERV comparison of achieved letting terms on long term lettings and renewals against valuation assumptions on like-for-like space, calculated on a net effective basis, aggregated at British Land's ownership share for each asset.

Leverage see loan to value (LTV).

Like-for-like rental income growth is the growth in net rental income on properties owned throughout the current and previous periods under review. This growth rate includes revenue recognition and lease incentive adjustments but excludes properties held for development in either period and lease accounting adjustments related to fixed and minimum rent reviews.

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.

Managed portfolio consists of multi-let properties where we have control of facilities and utilities management.

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

Multi-channel retailing is the use of a variety of channels in a customer's shopping experience, including research, before a purchase. Such channels include: retail stores, online stores, mobile stores, mobile app stores, telephone sales and any other method of transacting with a customer. Transacting includes browsing, collecting, buying, returning as well as pre and post-sale service.

Net development value is the estimated end value of a development project as determined by the external valuers when the building is completed and fully let (taking into account tenant incentives and notional purchaser's costs). It is based on the valuer's view on ERVs, yields, letting voids and tenant incentives.

Net effective rent is the contracted gross rent receivable taking into account any rent-free period or other tenant incentives. 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 time weighted average return (after adding notional purchasers costs) that a property will produce. In accordance with usual practice, the equivalent yield (as determined by the external valuers) assume rent is received annually in arrears.

Net initial yield (NIY) is the current annualised rent, net of costs, expressed as a percentage of capital value, after adding notional purchaser's costs.

Net rental income is the rental income receivable in the period after payment of direct property outgoings which typically comprise ground rents payable under head leases, void costs, net service charge expenses and other direct irrecoverable property expenses. Net rental income is quoted on an accounting basis. Net rental income will differ from annualised net cash rents and passing rent due to the effects of income from rent reviews, net property outgoings and accounting adjustments for fixed and minimum contracted rent reviews and lease incentives.

Net reversionary yield (NRY) is the anticipated yield to which the initial yield will rise (or fall) once the rent reaches the estimated rental value.

Occupancy rate is the estimated rental value of let units as a percentage of the total estimated rental value of the portfolio, excluding development and residential properties. It includes accommodation under offer, subject to asset management (where they have been taken back for refurbishment and are not available to let as at the measurement date) or occupied by the Group.

Omni-channel retailing seeks to provide the customer with a seamless shopping experience across channels, including stores, online and mobile.  This empowers customers to switch between channels during the shopper journey according to their preferences. For example, they can use mobile in-store to research or make a purchase, buy online and collect in-store, or they can buy in-store and initiate a return online.

Over rented is the term used to describe when the contracted rent is above the estimated rental value.

Overall 'topped-up' net initial yield (TUNIY) is the EPRA 'topped-up' net initial yield, adding all contracted uplifts to the annualised rents.

Passing rent is the gross rent, less any ground rent payable under head leases.

Property income distributions (PIDs) are profits distributed to shareholders which are subject to tax in the hands of the shareholders as property income. PIDs are normally paid net of withholding tax currently at 20% which the REIT pays to the tax authorities on behalf of the shareholder. Certain types of shareholder (e.g. pension funds) are tax exempt and receive PIDs without withholding tax. REITs also pay out normal dividends, called non-PIDs, which are taxed in the same way as dividends received from non REIT companies; these are not subject to withholding tax and for UK individual shareholders qualify for the tax free dividend allowance.

Portfolio valuation is reported by the Group's external valuers. In accordance with usual practice, they report valuations net, after the deduction of notional purchaser's costs, including stamp duty land tax, agent and legal fees.

Proportionally consolidated measures include the Group's share of joint ventures and funds and exclude non-controlling interests in the Group's subsidiaries.

Rack rented is the term used to describe when the contracted rent is in line with the estimated rental value, implying nil reversion.

Rent-free period see Tenant (or lease) incentives.

REITs are property companies that allow people and organisations to invest in commercial property and receive benefits as if they directly owned the properties themselves. The rental income, after costs, is passed directly to shareholders in the form of dividends. In the UK REITs are required to distribute at least 90% of their tax exempt property income to shareholders as dividends. As a result, over time, a significant proportion of the total return for shareholders is likely to come from dividends. The effect is that taxation is moved from the corporate level to the investor level as investors are liable for tax as if they owned the property directly. British Land became a REIT in January 2007.

Rent reviews take place at intervals agreed in the lease (typically every five years) and their purpose is usually to adjust the rent to the current market level at the review date. For upwards-only rent reviews, the rent will either remain at the same level or increase (if market rents have increased) at the review date.

Rents with fixed and minimum uplifts are either where rents are subject to contracted uplifts at a level agreed at the time of letting; or where the rent is subject to an agreed minimum level of uplift at the specified rent review.

Retailer sales growth is the like-for-like movement in retailer in-store sales against the same period in the prior year, on occupiers providing sales data throughout both comparable periods, aggregated at British Land's ownership share for each asset.

Retail planning consents are separated between A1, A2 and A3 - as set out in The Town and Country Planning (Use Classes) Order. Within the A1 category, Open A1 permission allows for the majority of types of retail including fashion to be accommodated, while Restricted A1 permission places limits on the types of retail that can operate (for example, a restriction that only bulky goods operators are allowed to trade at that site).

Class	Description	Use for all/any of the following purposes
A1	Shops	Shops, retail warehouses, hairdressers, undertakers, travel and ticket agencies, post offices, pet shops, sandwich bars, showrooms, domestic hire shops dry cleaners, funeral directors and internet cafes.
A2	Financial and professional services	Financial services such as banks and building societies, professional services (other than health and medical services) and including estate and employment agencies. It does not include betting offices or pay day loan shops - these are now classed as "sui generis" uses.
A3	Restaurants and cafes	For the sale of food and drink for consumption on the premises - restaurants, snack bars and cafes.
D2	Assembly and leisure	Cinemas, music and concert halls, bingo and dance halls (but not night clubs), swimming baths, skating rinks, gymnasiums or areas for indoor or outdoor sports and recreations.

Reversion is change in rent estimated by the external valuers, where the passing rent is different to the estimated rental value. The increase or decrease of rent arises on rent reviews and letting of vacant space or re letting of expiries.

Scrip dividend For certain periods, British Land offers its shareholders the opportunity to receive dividends in the form of shares instead of cash. This is known as a Scrip dividend.

Standing investments are assets which are not in the course of, or held for, development.

Tenant (or lease) incentives are incentives offered to occupiers to enter into a lease. Typically this will be an initial rent-free period, or a cash contribution to fit-out. Under accounting rules the value of lease incentives is amortised through the income statement on a straight line basis to the earliest lease termination date.

The residual site value of a development is calculated as the estimated net development value, less development profit, all development construction costs, finance costs (assumed at a notional rate) of a project to completion and notional site acquisition costs. The residual is determined to be the current site value.

Topping out is a traditional construction ceremony to mark the occasion when the structure of the building reaches the highest point.

Total property return is calculated as the change in capital value, less any capex incurred, plus net income, expressed as a percentage of capital employed over the period, as calculated by IPD. Total property returns are calculated monthly and indexed to provide a return over the relevant period.

Total accounting return is the growth in EPRA NAV per share plus dividends paid, and this can be expressed as a percentage of EPRA NAV per share at the beginning of the period.

Total shareholder return is the growth in value of a shareholding over a specified period, assuming dividends are reinvested to purchase additional units of stock.

Total tax contribution is a more comprehensive view of tax contributions than the accountancy-defined tax figure quoted in most financial statements. It comprises taxes and levies paid directly, as well as taxes collected from others which we administered.

Turnover rent is where all or a portion of the rent is linked to the sales or turnover of the occupier.

Under rented is the term used to describe when the contracted rent is below the estimated rental value (ERV), implying a positive reversion.

Underlying earnings per share (EPS) consists of underlying profit after tax divided by the diluted weighted average number of shares in issue during the period.

Underlying Profit is the pre-tax EPRA earnings measure with additional Company adjustments. No Company adjustments were made in either the current or prior period.

Valuation uplift is the increase in the portfolio valuation and sales receipts of properties sold during the period, net of capital expenditure, capitalised interest and development team costs, and transaction costs incurred, expressed as a percentage of the portfolio valuation at the start of the period plus net capex, capitalised interest and development team costs, and transaction costs.

Virtual freehold represents a long leasehold tenure for a period of up to 999 years. A 'peppercorn', or nominal, rent is paid annually.

Weighted average debt maturity is calculated by multiplying each tranche of Group debt by the remaining period to its maturity, with the sum of the results being divided by total Group debt in issue at the period end.

Weighted average interest rate is the Group loan interest and net derivative costs per annum at the period end, divided by total Group debt in issue at the period end.

Weighted average unexpired lease term is the average lease term remaining to first break, or expiry, across the portfolio weighted by contracted rental income (including rent- frees). The calculation excludes residential leases and properties allocated as developments.

Yield on cost is the estimated annual rent of a completed development divided by the total cost of development including site value and notional finance costs to the point of assumed rent commencement, expressed as a percentage return.

Yield shift is a movement (usually expressed in bps) in the net equivalent yield of a property asset, or like-for-like portfolio, over a given period, weighted by net capital value.

 

END

 

 

FR UNSORBRAVAUR