British Land is set to fall out of the FTSE 100 after a 21-year run in the blue-chip share index. The REIT will be replaced by engineering firm IMI following a reshuffle of the index and it will fall into the FTSE 250 from the start of trading on 19 June.
In the last six months, British Land’s share price has fallen by 11.41% to £355.70 [as of this morning] after the value of its portfolio was negatively impacted by rising interest rates and the mini-budget last autumn.
In its full year results published last month, the REIT revealed the value of its portfolio had fallen by 12.3%.
On releasing the figures, Simon Carter (pictured), CEO of British Land, said: “Higher interest rates have inevitably had an impact on property market yields and, as a result, the value of our portfolio declined by 12.3%. Whilst we remain mindful of ongoing macroeconomic challenges, the upward yield pressure appears to be easing and there are early signs of yield compression for retail parks.
“Ultimately, value in real estate is created over the medium to long term. We like to invest in supply constrained segments with pricing power, where we can be market leaders and leverage our competitive strengths to generate attractive returns. We already lead in campuses, where we continue to see strong demand for best in class space and are increasing our focus on life sciences and innovation sectors. We are consolidating our position as the largest owner and operator of retail parks where scale is an advantage, and we are building a unique portfolio of centrally located and highly sustainable urban logistics schemes in London.
“We have high quality assets, a best in class platform, a strong balance sheet, and we continue to see significant opportunities for future value creation through both development and capital recycling.”
