British Land share price rises on deal announcement

REIT sells two retail parks for £78 million

British Land share price rises on deal announcement, Tuesday, April 29: Shares in British Land (LON:BLND) opened higher this morning after the UK’s second-largest real estate investment trust (REIT) by market value announced the sale of two retail parks.

The REIT announced in a press release today that it had sold the St James Retail Park in Dumbarton and the Cwmbran Retail Park for a total sum of £78 million.

The 250,000 sq ft shopping center in Dumbarton, Scotland, was sold to the Legal & General Property Unit Trust for £45.8 million at a 5.9 percent net initial yield, while the 136,000 sq ft retail park in Cwmbran, Wales, was sold to UBS for £32.3 million at a 6.4 percent net initial yield, British Land revealed.

Retail focus

British Land has an extensive retail property portfolio, which includes half of the Meadowhall Shopping Centre in Sheffield, Drake Circus Shopping Centre in Plymouth, Parkgate Shopping Centre in Rotherham and the Green Lanes Shopping Centre in Barnstaple.

Today’s deal marks an advance in the company’s stated target of becoming more specialised in retail properties, while retrenching from other markets.

"These sales are in line with our strategy to further focus our retail portfolio on high quality, locally preferred shopping destinations," British Land's head of retail, Charles Maudsley, said in the REIT’s statement today.

He remarked that over the last 12 months, British Land had sold £386 million of retail assets, which was broadly matched by the acquisitions the company had made. According to Maudsley, British Land’s most significant property investment was SouthGate. Last September, British Land snapped up half of the Bath shopping centre for £101 million (British Land Share Price Down After New Property Investment).

Deals buoy British Land share price

British Land’s share price opened higher this morning. As of 08:22 BST, its shares were changing hands at 695.00p, 0.87 percent up on the day.

The stock has gained almost 10 percent since the beginning of the year, with investor sentiment buoyed by an upbeat trading update. At the end of January, British Land revealed that it had made decent progress in its fiscal third quarter (British Land share price rises on robust Q3). The FTSE 100-listed REIT is due to announce full year results on May 14.

According to AnalystRatingsNetwork data, three research analysts have a ‘sell’ rating on British Land, 10 have it as a ‘hold’ and 10 rate it as a ‘buy’. The stock’s consensus rating is ‘hold’ with an average price target of 686p.

As of 08:22 BST, buy British Land shares at 695.50p.

As of 08:22 BST, sell British Land shares at 694.50p.

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