British Land Company PLC · LSE:BLND
British Land — H1 2011/12 Earnings Presentation
79 slides from British Land's earnings presentation, Nov 14, 2011
Slide 1: Half Year Results Presentation
HALF YEAR RESULTS PRESENTATION HALF YEAR ENDED 30 SEPTEMBER 2011 www britishland com www.britishland.com
Slide 2: Chris Grigg, Chief Executive
fw, British Land CHRIS GRIGG Chief Executive
Slide 3: Resilient First Half Performance
Resilient First Half Performance • Resilient performance in a tougher economic climate • Focused on sustainable income • Benefiting from polarisation of UK property Well Positioned for Long Term 3
Slide 4: Agenda
Agenda • Results Overview Chris Grigg Chief Executive • Financial Review Lucinda Bell Finance Director • Portfolio Review Steve Smith Chief Investment Officer • Conclusion Chris Grigg Chief Executive 4
Slide 5: Delivering Superior Total Returns: Five Key Priorities
Delivering Superior Total Returns 1. Sustainable and growing income 2. Assets which protect and grow capital value 3. Creating incremental value 4. Controlling costs 5. Exploiting our scale and financial strength Focus on Five Key Priorities 5
Slide 6: Delivering Superior Returns – Growing Value
Delivering Superior Returns – Growing Value Portfolio Valuation Q1 11/12 Q2 11/12 H1 11/12 Retail 0.4% 0.3% 0.7% Offices 3 7% 3.7% 1 6% 1.6% 5 3% 5.3% Total 1.5% 0.8% 2.2% Portfolio Valuation Up 2.2% to £10.2bn 6
Slide 7: Delivering Superior Total Returns
Delivering Superior Total Returns Total Accounting Return Q1 11/12 Q2 11/12 H1 11/12 Growth in Net Asset Value 2.8% 1.4% 4.2% Dividend of (6.5p (6 5p per quarter) 1 2% 1.2% 1 1% 1.1% 2 3% 2.3% Total Return 4.0% 2.5% 6.5% Total Accounting Returns of 6.5% for H1 2011/12 7
Slide 8: Delivering Superior Total Returns
Delivering Superior Total Returns C it l R Capital Return t vs IPD T t l Property Total P t Return R t vs IPD 3.0% 6.0% +150 bps +120 bps 2.5% 5.0% 2.0% 4.0% 1 5% 1.5% 3 0% 3.0% 1.0% 2.0% 0 5% 0.5% 1 0% 1.0% 0.0% 0.0% Q1 11/12 Q2 11/12 H1 11/12 Q1 11/12 Q2 11/12 H1 11/12 IPD British Land IPD British
Slide 9: Continuing Over the Last Five Quarters
… Continuing Over the Last Five Quarters T t l Returns Total R t Relative R l ti tot IPD bps vs IPD 120 +100 bps 100 +90 bps +80 bps 80 60 40 +30 bps +30 bps 20 0 Q2 10/11 Q3 10/11 Q4 10/11 Q1 11/12 Q2 11/12 Unlevered Total Returns Significantly Outperformed IPD 9
Slide 10: Significant Rental Value Outperformance
Significant Rental Value Outperformance G Group ERV Growth G th Relative R l ti tot IPD 1.4% +100bps 1 2% 1.2% 1.0% 0.8% 0.6% 0.4% 0.2% 0.0% Q1 11/12 / Q2 11/12 / H1 11/12 / IPD British Land Outperforming IPD Rental Value Growth by 100bps 10
Slide 11: Significant Rental Value Outperformance
Significant Rental Value Outperformance ERV Growth Q1 11/12 Q2 11/12 H1 11/12 Retail British Land 0.4% 0.1% 0.5% IPD (0 1)% (0.1)% (0 2)% (0.2)% (0 3)% (0.3)% Offices B iti h LLand British d 1 7% 1.7% 1 3% 1.3% 3 0% 3.0% IPD 1.3% 0.6% 1.9% Outperforming IPD Rental Value Growth in Retail and Offices
Slide 12: Income Growth Through Asset Management – Retail
Income Growth Through Asset Management – Retail Q1 2011/12 Q2 2011/12 H1 2011/12 Occupancy p y 98.7% 98.3% 98.3% Lettings/Renewals 261,600 sq ft 265,700 sq ft 527,300 sq ft Lettings/Renewals vs ERV +4.6% 4 6% +6 1% +6.1% +5 4% +5.4% Total Activity 736,400 sq ft 786,900 sq ft 1,523,300 sq ft Increase
Slide 13: Income Growth Through Asset Management – Offices
Income Growth Through Asset Management – Offices Q1 2011/12 Q2 2011/12 H1 2011/12 p y Occupancy 97.8% 97.7% 97.7% Lettings/Pre‐lets 5,100 sq ft 187,700 sq ft 192,800 sq ft Lettings vs ERV ‐ +7 0% +7.0% +6 0% +6.0% Total Activity 108,800 sq ft 581,900 sq ft 690,700 sq ft Increasein Rent £0.3m £8.0m £
Slide 14: Development Programme Key Milestones
Development Programme Key Milestones Leadenhall Regent’s Place‐NEQ Broadgate Pre‐let signed with Aon for 191,000 sq ft Pre‐let 145,000 sq ft to Debenhams Passed period for judicial review Rent of £56.60psf Rent of £50psf rising to £53.50psf 700,000 sq ft building Option on 85,000 sq ft 70% of reside
Slide 15: Adding Income Through Acquisitions
Adding Income Through Acquisitions Virgin Active Racquet Clubs Grenfell Island, Maidenhead Wardrobe Court, EC4 Net equivalent yield 8.4% 113,000 sq ft of high quality office space 92 serviced apartments Annual rental income £13m Net Initial yield 7.5% Capital value £800psf Let to Virgin Active on 25
Slide 16: Benefits of Scale and Financial Strength
Benefits of Scale and Financial Strength • £1.2 bn of unsecured and secured refinancing – £560m unsecured bank facility – $480m (£300m) US Private Placement – £350m secured bank debt for related JVs and Funds • Taking T ki advantage d t off our size i and d strength t th Delivering Superior Total Re
Slide 17: Lucinda Bell, Finance Director
LUCINDA BELL Finance Director
Slide 18: Key Themes
Key Themes • Quality of income flows • Strength g of financingg • Derisking of developments Strong Platform to Generate Superior Total Returns 18
Slide 19: Results Highlights
Results Highlights £m H1 2010 H1 2011 NAV per share 525p 591p LTV 45% 45% Underlying PBT £127m £132m Underlying EPS 14.2p 14.6p Dividend 13.0p 13.0p H1 Total Accounting Return of 6.5% (12 Months +17.5%) 19
Slide 20: Income Statement
Income Statement £m H1 2010 H1 2011 Net rental income 255 269 Fees & other income 9 8 Admin expenses (32) (38) Net finance costs (105) (107) Underlying PBT 127 132 Underlying EPS 14.2p 14.6p Net Rents Up 5.5% 20
Slide 21: Net Rental Income Growth
Net Rental Income Growth £m H1 2010 H1 2011 Change Retail 151 152 +0.7% Offi Offices 67 69 +1 8% +1.8% Other 14 14 +2.1% p Properties owned throughout g 232 235 +1.1% Development 13 14 Acquisitions 1 17 Disposals 2 ‐ Guaranteed rental increases & other 7 3 T t l Total 255 269 +5.5% 5 5% 1.1% Growth
Slide 22: Growth in Underlying PBT
Growth in Underlying PBT R Reconciliation ili ti off Underlying U d l i PBT £5m £14m £(4)m £(6)m £(1)m £(3)m £127m £132m H1 2010 Acquisitions A i iti D l Developmentt P Properties ti Admin Ad i F Fees & Fi Finance C Costs t H1 2011 & Disposals Lettings Held for Expenses Other Income & Other Developm
Slide 23: Growth in Net Asset Value
Growth in Net Asset Value R Reconciliation ili ti off Net N t Asset A tV Value l per Sh Share 14p 7p 11 11p 5p (13)p 591p 567p M 11 Mar Office Offi Retailil R Development D l Underlying U d l i Di id d Dividends S 11 Sep revaluation revaluation revaluation Profit Net Asset Value Up 4.2% Since March
Slide 24: Sound Financing Principles
Sound Financing Principles • Manage refinancing risk maturities • Diversified sources of finance • Maintain liquidity • Optimise flexibility • Ensure good access to the debt markets Our Scale and Quality Provides Access to Range of Debt Markets 24
Slide 25: Well Timed Financings
Well Timed Financings A Average REIT U Unsecured d Bond B d SSpreads d % 10 8 £350m secured $480m (£300m) 5‐Year HUT Facilityy 6 unsecuredd USPP All‐in rate of 4%pa £560m unsecured 11.2 years LIBOR plus 146bps 4 5‐Year Bank Syndicate LIBOR plus 125bps 2 0 2009 2010 2011 Source: Bloomberg £1.2bn of F
Slide 26: Strong Balance Sheet Metrics
Strong Balance Sheet Metrics Inc. Share of JVs & Funds Sep 2010 Mar 2011 Sep 2011 Net debt £3,990m £4,317m £4,645m Loan to Value (LTV) 45% 45% 45% Loan to Value (LTV) – Group 22% 24% 28% Interest cover 2.2x 2.2x 2.2x Interest cover – Group p 3.0x 3.0x 3.3x Average interest rate 5.2% 4.9% 4.7% Averag
Slide 27: Refinancing
Refinancing D bt Maturity Debt M t it Group JVs & Funds1 • £554m development spend £m £m ( t off sales) (net l ) H2 2011/12 85 120 • £311m of Group cash and liquid H1 2012/13 21 125 investments H2 2012/13 11 119 • £2.5bn of total Group facilities H1 2013/14 1 23 – Of which £1.5bn has a maturity H2 2
Slide 28: Office Development – Managing Letting Risk
Office Development ‐ Managing Letting Risk Offi EEstimated Office ti t d Rental R t lVValue l (ERV) £50m £40m £17m £30m Speculative £20m Pre‐let £23m £25m £10m £8m £0m City West End Development Programme 10% of Gross Assets 28
Slide 29: Development – Managing Letting Risk
Development ‐ Managing Letting Risk BL Total T t l ERV Resetting R tti tto M Market k t vs IPD – Next N t 3 YYears 30% 25% 20% 15% Developments (Speculative) 27% 7% 10% Vacant & Income Expiring 5% 9% 0% British Land IPD (exc. development) Pro forma for 755,000 sq ft of extensions on existing UBS lea
Slide 30: Sustainable and Growing Rental Profile
Sustainable and Growing Rental Profile P tf li R Portfolio Reversion i Next 5 Years (excluding developments) £67m £15m £(3)m £(42)m £607m £607m £570m £528m Annualised Spreading of Annualised Expiry of Rent Letting of Net Reversionary Gross Rental Rent Frees & Rents Frees & Fixed Vacant Reversions Re
Slide 31: Loan to Value
Loan to Value • Target loan to value range of 40‐50% • Average lease length of 11.7 years • 97.8% occupancy • Only O l 7.3% 7 3% off rentt expiring i i iin th the nextt 3 years • Tenants in administration and temporary lettings are less than 1% of rent • 24% of rent subject to annual RPI or fixed co
Slide 32: Summary
Summary • Quality of income flows • Strength of financing • Derisking of developments Strong Platform to Generate Superior Total Returns 32
Slide 33: Steve Smith, Chief Investment Officer
STEVE SMITH Chief Investment Officer
Slide 34: Key Messages
Key Messages • Clear portfolio strategy • ‘Flight g to q quality’ y benefitingg British Land • Well positioned going forward – Clear strategic focus – High quality, defensive portfolio – Attractive opportunities for growth Strong Platform to Generate Superior Total Returns 34
Slide 35: Continued Portfolio Outperformance
Continued Portfolio Outperformance • Outperformance driven by portfolio structure and our activity B iti h LLand British dRReturns t vs IPD H1 2011/12 British Land IPD I Income Returns R 2 5% 2.5% 2 9% 2.9% Capital Return 2.5% 1.0% + 150 bps ‐ ERV Growth 1 3% 1.3% 0 3% 0.3% + 100 bps ‐ Yield Compres
Slide 36: Driven by Management Actions
… Driven by Management Actions C t ib ti to Contribution t Valuation V l ti Uplift U lift • Portfolio value up p 2.2% to £10.2bn • Uplift driven by our actions – Asset management initiatives – Increased profits from London development programme – Expiry of rent frees Expiry • Uplift driven by market
Slide 37: Retail Investment Yields Starting to Diverge
Retail Investment Yields Starting to Diverge • 50 bps increase in prime/secondary shopping centre yield gap Equivalent Yields % August September October November Prime Open A1 Retail Parks 5.0 5.0 5.0 5.0 Prime Shopping Centres 5.5 5.5 5.5 5.5 Secondary Shopping Centres 8.0 8.25 8.25 8.5 Source: CBR
Slide 38: Retail Investment Yields Starting to Diverge
Retail Investment Yields Starting to Diverge • Continued demand for limited prime stock – at yields sub 5.5% • Large volumes of secondary shopping centres on offer at reduced prices or f ili tto sellll failing Shopping Centre and Retail Park Investment Activity since July Completed Under Offer Avail
Slide 39: Marked Variation in Retail Sector Performance
Marked Variation in Retail Sector Performance R t il SSales Retail l Values V l ONS % growth pa 3mths rolling average June July August September Food Retailers 3.5% 2.9% 4.0% 5.2% Fashion 3.8% 3.5% 3.4% 2.2% Dept & Variety Stores 2.2% 2.5% 2.9% 3.9% Electricals (12.4)% (15.4)% (15.0)% (11.1)% Furnit
Slide 40: Retailers Continue to Migrate to the Best Locations
Retailers Continue to Migrate to the Best Locations Sh Shopping i C Centre t V Vacancy R Rates t 19% 17% 15% 13% 11% 9% 7% 5% 2009 Q4 2010 Q4 2011 Q2 Big Shopping Centres Smaller Prime Shopping Centres Secondary Shopping Centres Source: PMA (Promis) Increasing Divergence Between Prime and Secondary
Slide 41: Polarising Retail Rental Value Performance
Polarising Retail Rental Value Performance R t il R Retail Rental t lVValue l P Performance f March 2007 = 100 105 Prime 100 95 90 Secondaryy 85 80 Mar 07 Sep 07 Mar 08 Sep 08 Mar 09 Sep 09 Mar 10 Sep 10 Mar 11 Sep 11 Source: IPD Increasing Divergence Between Prime and Secondary 41
Slide 42: Continued Retail Leasing Success – First Half
Continued Retail Leasing Success – First Half L tti /R Lettings/Renewals l in i H1 L tti /R Lettings/Renewals l vs ERV Q1 Q2 Total Number 85 87 172 23% Sq ft 000 262 265 527 53% Annual Rent £4.7m £4.8m £9.5m vs ERV 4.6% 6.1% 5.4% 24% >70% of H1 Lettings/Renewals in Line or Ahead of Rental Value 42
Slide 43: Leasing Activity in the Pipeline
Leasing Activity in the Pipeline L tti Lettings U Under d Offer Off B By R Retailer t il Type T 24% • 520,000 sq ft completed/ under offer since September 14% • Includes 140,000 sq ft of pre‐lets 41% 9% • Overall in line or ahead of ERV 8% 4% Food & Other Beverage 520,000 sq ft of Lettings Completed
Slide 44: A Strong and Defensive Retail Portfolio
A Strong and Defensive Retail Portfolio • Locally and regionally dominant assets • Depth and quality of occupier line‐up • Low vacancy rate 1.7% At 30 Sept p 2011 UK IPD Occupancy rate 98.3% 95.8% Lease length 12.5 yrs 11.7 yrs Income expiring (next 3 years) 7.2% 15.3% Occupiers in admin 0.4% n/a Te
Slide 45: Well Positioned For Future Growth
… Well Positioned For Future Growth • Net initial yield just 42 bps premium to IPD Retail Rent Review Profile At 30 Sept 2011 BL IPD Average contracted rent £22psf £16psf 76% Average ERV £22psf £17psf EPRA Net Initial Yield 5.4% 5.8% 11% Net Equivalent Yield 5.7% 6.2% 11% 2 Other Medium Term Outlook
Slide 46: West End Offices
West End Offices • Continuing robust occupational demand and constrained supply • Very limited supply of investment stock, growing number of purchasers • Rents ahead 7% year to date date, yields firm West End Grade A & B Availability m sq ft 8 Grade A Availability Grade B Availability 6 4 2 0 1993 1
Slide 47: Increasing Polarisation in City Offices
Increasing Polarisation in City Offices C Current tMMarket k t Availability A il bilit £bn Prime Secondary Total • c.£5bn c £5bn of City investment stock availability Available 0.7 2.5 3.2 • Demand for prime strong Under offer 0.7 0.7 1.4 • £0.7bn prime under offer at Total 1.4 3.2 4.6 yields of 4.7
Slide 48: City Offices Grade A Supply and Demand
City Offices Grade A Supply and Demand Si ifi t A Significant Active ti R t City Requirements i Cit Take‐Up T k U and d Demand D d Sq ft m Sq ft Schroders 250 000 250,000 30 3.0 80 8.0 Take‐Up Active Demand (RHS) Jardine Lloyd Thomson 200,000 7.0 2.5 6.0 ING 175,000 2.0 50 5.0 Nabarro 125,000 1.5 4.
Slide 49: City Grade A Supply Being Pushed Out
City Grade A Supply Being Pushed Out Ch Change iin Cit City G Grade d AD Development l t Pipeline Pi li m sq ft 5 4.9m long term average take up 4 3 2 1 0 Mar 11 Sep 11 Mar 11 Sep 11 Mar 11 Sep 11 Mar 11 Sep 11 2011 2012 2013 2014 Source: CBRE Insufficient Supply to Satisfy Even Low Demand 49
Slide 50: British Land Office Asset Management Activity
British Land Office Asset Management Activity • 2.3m sq ft of letting/renewals since Dec 09 securing £68m of rent • Including 542,000 sq ft since March • British Land accounts for c.20% of central London take‐up since Dec 09 • Letting on average for a term of 16.6 years ‘000 Sq ft City West End Tota
Slide 51: Existing Office Portfolio Well Positioned
Existing Office Portfolio Well Positioned • Virtually fully occupied 97.7% Income % of Topped‐ Average Capital Lease Expiring At 30 Sept 2011 investments up NIY % ERV £ psf Value £ psf Length yrs (next 3 yrs) % Long‐term Income 53 5.9 43 737 12.6 0.3 ( (over 10 yrs)) Medium‐term 30 6.2 42 703 7.5 4.
Slide 52: London Office Development Programme
London Office Development Programme Delivering the Right Type of High Quality Product 52
Slide 53: Profitable Development Programme
Profitable Development Programme Development Returns Construction Costs Current Site Value £437m Cost to Complete l £583m 83 Notional Interest £79m Residential Sales Values £138m 66% 11% ERV £72m Development profit realised £134m 18% Development profit to come £179m 5% Development Yield 7.4% Cash on
Slide 54: Growing Income and Value Through Acquisitions
Growing Income and Value Through Acquisitions • £806m of acquisitions in 18 months; £250m of disposals Acquisitions over last 18 months Price £m Rent £m NIY %1 Retail 400 24.1 6.5 Offices 227 9.2 6.3 Leisure/Other 179 13.1 7.3 Total 806 46.4 6.7 1 Based on £700m income producing assets Acquisitions
Slide 55: Chris Grigg, Chief Executive
fw, British Land CHRIS GRIGG Chief Executive
Slide 56: Appendices
fw, British Land APPENDICES
Slide 57: Reconciliation of Underlying Profit Before Tax
Reconciliation of Underlying Profit Before Tax Half Year to 30 September 2010 £m 2011 £m IFRS Profit/(Loss) before tax 328 331 Net valuation movement (includes disposals) (216) (202) Deferred and current taxation of joint ventures & funds 3 1 Amortisation of intangible asset 8 ‐ Other non‐recurring
Slide 58: Quarterly Income Statement
Quarterly Income Statement £m Q1 2011 Q2 2011 Net rental income 132 137 Fees & other income 4 4 Admin expenses (19) (19) Net finance costs (52) (55) Underlying PBT 65 67 Underlying EPS 7.2p 7.4p 58
Slide 59: Gross (Accounting) Rental Income – Sectoral Analysis
Gross (Accounting) Rental Income – Sectoral Analysis Gross Rental Income (£m pa) 6 months to September 2011 Annualised as at 30 September 2011 Group JVs & Funds Total Group JVs & Funds Total Retail Warehouses 53 20 73 107 42 149 Superstores 4 32 36 8 64 72 Shopping Centres 18 30 48 34 60 94 Departme
Slide 60: Net Operating Costs Ratio
Net Operating Costs Ratio Six months to 30 September H1 2010 £m H1 2011 £m Property Outgoings 12 14 Admin Expenses 32 38 Fees & Other Income (9) (8) Net Operating Costs 35 44 Gross Rental Income 267 283 2011 Costs C t as % off Gross G R Rentt 13 1% 13.1% 15 5% 15.5% 60
Slide 61: EPRA Balance Sheet (Proportional Consolidation)
EPRA Balance Sheet (Proportional Consolidation) £m Group JVs & Funds Sep 2011 Sep 2010 Total properties 5,342 4,821 10,163 8,857 Net debt (2,133) (2,512) (4,645) (3,990) Other net liabilities (120) (55) (175) (184) EPRA Net Assets 3,089 2,254 5,343 4,683 EPRA Dil Diluted t d NAV per share h 591 591p
Slide 62: Reconciliation of EPRA NAV & NNNAV
Reconciliation of EPRA NAV & NNNAV 2010 2010 2011 2011 As at 30 September 2011 £m Pence £m Pence Balance sheet (IFRS) net assets 4,433 497 5,064 560 Deferred tax arising on revaluation movements 33 4 33 4 Mark to market on effective cash flow hedges and related 173 19 193 21 debt adjustments Adjust
Slide 63: Net Debt
Net Debt As at 30 September 2011 Group £m JVs & Funds £m Total £m Gross debt 2,506 2,672 5,178 Market value of derivatives 12 126 138 Cash & liquid investments (311) (167) (478) EPRA adjustments1 (74) (119) (193) Net debt (EPRA basis) 2,133 2,512 4,645 A Average iinterest t t rate t 4 3% 4.3% 5 1% 5
Slide 64: Diverse Funding Profile
Diverse Funding Profile £5bn £0.7bn Other JV & Funds debt £4bn £1.9bn Securitisations £3bn Debentures & loan notes USPPs £2bn £1.0bn £1.0bn Unsecured debt £0.5bn £0.5bn £1bn £0.9bn £0.9bn £0bn Group (LTV: 28%) Prop. Consol. (LTV: 45%) 64
Slide 65: Top 10 Properties
Top 10 Properties Sq ft BL Rent Occupancy Lease length As at 30 September 2011 excluding developments ‘000 Share % £m pa1 rate %2 yrs3 1 Broadgate, EC2 4,436 50 174 97.3 7.7 2 Regent’ss Place, NW1 Regent 1,210 100 52 98.3 9.3 3 Meadowhall Shopping Centre 1,376 50 83 98.0 10.1 4 Ropemaker Place, EC2
Slide 66: Top 20 Customers
Top 20 Customers % of total rent % of total rent Tesco 7.4 Bank of Tokyo‐Mitsubishi UFJ 1.7 Sainsbury’ss Sainsbury 63 6.3 Macquarie Group 16 1.6 Debenhams 4.3 Herbert Smith 1.5 UBS 3.8 Alliance Boots 1.4 Virgin Active 2.6 RBS 1.3 Homebase 2.3 Asda (inc. Asda Living) 1.2 Kingfisher (B&Q) 2.3 Hutchiso
Slide 67: Portfolio Valuation by Sector
Portfolio Valuation by Sector Group Funds & JVs Total Portfolio Change2 As at 30 September 2011 £m £m1 £m % 6 mths %2 3 mths %2 Retail Warehouses 1,881 807 2,688 26.5 1.0 0.4 Superstores 143 1,208 1,351 13.3 1.2 0.8 Shopping Centres 497 1,025 1,522 15.0 0.6 0.4 Department Stores 448 ‐ 448 4.4 0.1 0.
Slide 68: Yield Profile
Yield Profile Excluding EPRA Net Initial EPRA Topped‐up Topped up Overall Topped‐up Topped up Net Reversionary Net Equivalent developments (%) Yield1 Net Initial Yield1,2 Net Initial Yield1,3 Yield1 Yield1 Retail Warehouses 5.4% 5.6% 5.7% 5.7% 5.7% Superstores 5.0% 5.0% 5.1% 5.0% 5.0% Shopping Centr
Slide 69: Lease Length & Occupancy
Lease Length & Occupancy Excluding Developments Average g Lease Length g (y (yrs)) Occupancy p y Rate (%) ( ) To Expiry To First Break Occupancy Occupancy (Overall)1 Retail Warehouses 11.0 10.1 97.7 98.2 Superstores 16.3 16.3 100.0 100.0 Shopping Centres 10.4 9.6 96.0 96.8 Department Stores 29.1 25.
Slide 70: Annualised Rents and Average Rent £psf
Annualised Rents and Average Rent £psf Excluding Developments Annualised Rents (£m pa)1 Average Rent (£psf) Group JVs & Funds Total Contracted2 ERV3 Retail Warehouses 109 44 153 23 23 Superstores 8 64 72 21 21 Shopping Centres 34 58 92 28 29 Department Stores 28 ‐ 28 12 9 UK Retail 179 166 345 22 22
Slide 71: Contracted Rental Increases (Cash Flow Basis)
Contracted Rental Increases (Cash Flow Basis) Year to 30 September (£m pa) Excluding developments 2012 2013 2014 2015 2016 2012‐14 2012‐16 Expiry of rent free periods 21 21 9 ‐ ‐ 51 51 Guaranteed fixed & minimum rental uplifts 4 3 2 4 3 9 16 Total 25 24 11 4 3 60 67 71
Slide 72: Rent Subject to Open Market Rent Review
Rent Subject to Open Market Rent Review Year to 30 September (£m pa) Excluding developments 2012 2013 2014 2015 2016 2012‐14 2012‐16 Retail Warehouses 19 28 22 18 26 69 113 Superstores 4 3 10 25 13 17 55 Shopping Centres 16 9 11 17 12 36 65 Department Stores ‐ ‐ ‐ ‐ 5 ‐ 5 UK Retail 39 40 43 60 56 12
Slide 73: Rent Subject to Lease Break or Expiry
Rent Subject to Lease Break or Expiry Year to 30 September (£m pa) Excluding developments 2012 2013 2014 2015 2016 2012‐14 2012‐16 Retail Warehouses 3 5 3 9 7 11 27 Superstores ‐ ‐ ‐ ‐ ‐ ‐ ‐ Shopping Centres 5 5 5 5 7 15 27 Department Stores 1 ‐ ‐ ‐ ‐ 1 1 UK Retail 9 10 8 14 14 27 55 E Europe 2 3 2
Slide 74: Rent Resetting to Market
Rent Resetting to Market Year to 30 September (£m pa) Excluding developments 2012 2013 2014 2015 2016 2012‐14 2012‐16 Income expiring – existing portfolio1 15 19 11 20 36 45 101 Speculative developments – City ‐ ‐ 17 ‐ ‐ 17 ‐ Speculative developments – West End ‐ 24 ‐ ‐ ‐ 24 ‐ Speculative developmen
Slide 75: Committed Developments
Committed Developments PC Current Cost to Notional Residential BL Sq ft Calendar Value Complete Interest ERV Pre‐let End Value As at 31 March 2011 Share ‘000 Year £m £m1 £m1 £m2 £m £m3 5 Broadgate, EC2 50% 700 Q4 2014 100 154 28 19.1 19.1 ‐ g EC34 The Leadenhall Building, 50% 610 Q2 2014 65 151 21 1
Slide 76: Prospective Developments
Prospective Developments As at 30 September 2011 BL Share % Sq ft ‘000 39 Victoria Street, SW1 100% 90 Planning submitted 6‐9 Eldon Street, EC2 100% 33 Planning pending Colmore Row, Birmingham 100% 280 Detailed planning consent Meadowhall Metropolitan1, Sheffield 100% 2,200 Outline planning consent
Slide 77: Estimated Future Development Spend
Estimated Future Development Spend C t to Costs t complete l t (excluding land notional interest and residential pre‐sales) £350m £300m £293m £255m Retail Offices £250m £200 £200m £150m £100m £73m £50m £27m £0m 2012 2013 2014 2015 12 mths to 30 September 1To PC (based on notional cost of finance of
Slide 78: Illustrative Unrealised Office Development Profits
Illustrative Unrealised Office Development Profits profit illustration1 Unrealised p Average g Valuation Yield (pence per share) +75bps +50bps +25bps 5.4% (25bps) (50bps) (75bps) (10%) (1) 3 8 14 19 26 34 (5%) 2 6 11 17 23 30 38 £58 4 9 14 20 26 34 42 Estimated Rental Value2 +5% 8 13 18 24 31 39 47
Slide 79: Disclaimer
Disclaimer The information contained in this presentation has been extracted largely from the Half Year Results Announcement for the six months ended 30 September 2011. This presentation may contain certain “forward‐looking” statements. By their nature, forward‐looking statements involve risk and un