British Land expects higher earnings as lettings grow

British Land expects its first-half underlying earnings per share to increase by approximately 5%, reporting stronger rental income and leasing activity across its London office campuses and retail parks.

In an unaudited trading update covering the six months ended 30 September 2026, the commercial property company forecast underlying earnings per share of 16.1p, compared with 15.4p in the corresponding period last year.

British Land also expects underlying profit of £166m, up from £155m. The figures are company expectations ahead of its formal half-year results, scheduled for 18 November, rather than final externally reviewed results.

The company reported 12% like-for-like net rental income growth during the period. It attributes this to development leasing, the occupation of previously vacant space and performance across its principal property markets, supported by cost efficiencies.

Like-for-like net rental income measures changes in rental income from a comparable set of properties. It is distinct from growth in estimated rental value, movements in portfolio valuation and changes in the occupancy rate.

British Land estimates that portfolio values increased by 1.5% during the six months, subject to external review. It also reported estimated rental value growth of 3%, reflecting its assessment of market rental levels rather than rent already collected.

Leasing activity was particularly strong within its campus portfolio. The company completed 78 transactions covering 689,000 sq ft at rents 14.8% above estimated rental value. Campus like-for-like net rental income increased by 25%, reflecting both letting activity and the occupation of previously vacant accommodation.

The campus figures include leasing progress at Broadgate and Regent’s Place. British Land reports that 1 Broadgate and One Triton Square are now fully let, while an additional 119,000 sq ft was under offer at 2 Finsbury Avenue. That latter space is included within the development’s 52% let-or-under-offer measure and should not be treated as a completed letting.

The retail park portfolio also recorded substantial leasing activity. British Land reported 438,000 sq ft of transactions at rents 6.8% above estimated rental value and 9.6% above previous passing rents.

Occupancy across its retail parks stood at 99%, according to the trading update. A further 533,000 sq ft of retail park space was under offer, representing prospective transactions rather than completed agreements.

The company reported total leasing of approximately 1.4m sq ft across its portfolio during the half-year, with agreed rents 10.4% above estimated rental value. This measure includes different types of property and should not be confused with the individual campus or retail park figures.

British Land also completed £247m of asset disposals during the period, broadly in line with book value, and reported a further £202m of sales under offer. The latter amount has not yet been realised through completed transactions.

Its acquisition activity included the purchase of Telford Bridge Retail Park for £30m. The company is using purchases and disposals to adjust the composition of its portfolio, while managing borrowing and development expenditure.

British Land estimated its loan-to-value ratio at approximately 39.6%, compared with 39.2% at the previous financial year-end. The ratio compares borrowing with asset values and is therefore sensitive to both financing activity and property valuations.

The company has reiterated its guidance for full-year underlying earnings per share of at least 30.5p. This remains a management forecast and depends on subsequent trading, financing costs and other factors affecting financial performance.

The first-half update provides evidence of higher reported rental income and substantial lettings across British Land’s selected property markets, but it does not establish comparable conditions across all UK offices or retail property.

The formal November results will provide the next opportunity to assess the final first-half financial figures, reviewed property valuations and the extent to which the company’s leasing activity is being reflected in completed rental income.