(Adds peer performance)
May 18 Britain's largest listed property
developer Land Securities warned that Brexit had
created business uncertainty in the London office market,
leading to falls in demand, rental values and construction
The developer behind London's "Walkie Talkie" skyscraper
reported a 1.2 percent fall in adjusted diluted net asset value
- a measure of a developer's buildings - to 1,417 pence for the
year to March 31.
Analysts on average had expected adjusted NAV of 1,372
pence, according to a company-supplied consensus.
"We won't be sure of the long-term effect of Brexit on our
markets for some time....We're taking this time to prepare the
business for the opportunities and challenges we see ahead,"
Chief Executive Robert Noel said in a statement.
Among the FTSE-100 commercial developers, Land Securities
has the largest exposure to UK offices, which could feel an
impact as financial firms are considering moving some work out
of Britain due to Brexit.
The company said rental values in the London office market
were unlikely to grow, unless there was more certainty on the
free movement of people and Britain's terms of trade with the
Land Securities had entered the downturn with limited
exposure to development projects that were proceeding without
tenants, longer-than-industry average lease lengths on its
properties and high occupancy.
On Wednesday, peer British Land forecast persisting
uncertainty in the UK property market for some considerable time
as Brexit talks proceed, even as it noted that London office
customers were taking longer to make decisions on moves.
Land Securities said on Thursday it had just 283,000 square
feet of available office space developed to let, after turning
cautious on speculative development in 2015.
It could decide to exploit 1.4 million square feet of future
development opportunities, when the time was right, it added.
In comparison, British Land stayed bullish on such
construction for longer and exposure to such projects without
tenant preleases stands at below 4 percent, but is still worth
about 1.7 billion pounds.
(Reporting by Esha Vaish in Bengaluru; editing by Jason Neely
and Susan Thomas)