Worst is passed, says British Land - commercial mortgages

20 May 2008

In news which may interest those thinking of taking out commercial mortgages, British Land has said that the worst of the property downturn has now passed.

The company posted a pre-tax loss of £1.6 billion with a 20 per cent loss of asset value in the year to March 31st, but the company noted that the rate of decline had slowed.

In the first quarter of 2008 the rate of decline was slower than before, down to 2.2 per cent.

Noting that the results had been better than expected, chief executive Simon Hester said: "We believe that property pricing is now generally much more supportable than at the market peaks when we were large scale sellers and that the worst of yield correction should be behind us."

Meanwhile, property investment firm Segro said that occupier demand in its commercial premises has remained stable, although there has continued to be downward pressure on commercial property values.

Overall occupancy has stayed above 90 per cent, the company stated.