BRITISH LAND INVESTOR PRESENTATION SEPTEMBER/OCTOBER 2014 BRITISH - - PowerPoint PPT Presentation

WWW.BRITISHLAND.COM SEPTEMBER/OCTOBER 2014

BRITISH LAND INVESTOR PRESENTATION

BRITISH LAND AT A GLANCE

• A leading UK commercial

property company and REIT

• UK assets owned or managed of

£17.8bn – BL share £12.0bn

• Focused on high-quality UK

retail and London offices

– 60% of portfolio in London and South East

• Well-placed to benefit from
• ccupier demand and rental

growth

• Strong balance sheet and ability

to raise new capital

2

Department Stores 4% £0.6bn

UK RETAIL LONDON OFFICES

Property Portfolio by Value (at March 2014)

INTRODUCTION

• In 2010 we set out a clear plan

– Substantial net investors in the market – Taking on more risk, mainly through development – Increase exposure to London and South East – Reshape our retail portfolio

• Executing well against that plan

– Delivering 2010 development programme – Replenishing development pipeline – Investing in attractive assets – Improving operating metrics

• Delivering strong results

– Our decisions and actions have driven performance – Recent benefit from strengthening markets

3

4

POSITIONING PORTFOLIO AROUND KEY TRENDS

London as a leading global City Attractive environments Importance of transport infrastructure

• Committed more capital to London and South East: increased

weighting to over 60% of our portfolio

• Increased exposure to West End and up and coming locations
• Focused on creating “Places People Prefer”
• Well managed environments at our Office campuses and

Retail destinations

• Investment around transport hubs
• Over £3.0bn of our properties close to Crossrail stations

1 2 3

Key role of high quality physical retail

• Reshaping our Retail portfolio to focus on best retail locations
• £2.3bn of gross UK investment activity in last 4 years
• Sale of mature assets ahead of valuation

4

Profitable development

• A fundamental driver of value
• Total estimated profits of £636m from 2010 programme
• Great progress replenishing pipeline; retain optionality

5

RESHAPING OUR UK PORTFOLIO TO DELIVER LONG-TERM PERFORMANCE

Development 10 Portman Square 5 Broadgate The Leadenhall Building Clarges Mayfair The Hempel 4&5 Kingdom St Marble Arch House 10-30 Brock Street 199 Bishopsgate Whiteley Shopping Shoreditch

Investments & Disposals over last 4 yrs*

INVESTMENTS DISPOSALS

£1.6bn £3.0bn

Disposals Ropemaker Place Residential units 18 Food stores 17 Retail Parks including Beehive Centre, St James Dumbarton 2 shopping centres (Bon Accord, Aberdeen and Eastgate, Basildon) 9 leisure assets

Development Acquisitions

Acquisitions Drake Circus Virgin Active HUT units Paddington Central SouthGate, Bath Ealing Broadway SC Eden Walk, Kingston

5

* As at May 2014

6

DELIVERING STRONG PERFORMANCE

• Strong property performance versus IPD benchmark
• 15.5% pa total accounting returns over 5 years; 20.0% total accounting

returns in 2014

• Returned £1.2bn in dividends to shareholders over 5 years

YE 31 March 2014 Annualised 2011-2014 Annualised 2009-2014 Total Property Returns 14.2% 9.5% 12.6% Total Property Returns vs IPD +60bps +180bps +220bps NAV growth 15.4% 6.7% 11.6% Dividend income return 4.6% 3.9% 3.9% Total Accounting Return 20.0% 10.6% 15.5%

• 80

80 160 240 320 400 480 560 640

Asset Management Development Yield Movement Total Valuation

MATERIAL IMPROVEMENT IN VALUATIONS

7

Valuation Drivers

£m

H2 2012/13 H1 2013/14

£22m £90m £309m

TOTAL VALUATION MOVEMENT

£639m

H2 2013/14 H1 2012/13

STRONG OPERATIONAL PERFORMANCE

• Strong operational performance in improving markets
• Continue to sign lettings/renewals ahead of ERV in Q1 with occupancy

ahead

8

FY to 31 March 2014 Retail Office Total Lettings and renewals (000 sq ft) 1,674 632 2,306 Investment lettings/renewals vs ERV +4.9% +8.4% +6.3% Occupancy 98.5% 92.1% 96.1% LFL occupancy +100bps +190bps +130bps

9

STRONG FINANCING METRICS

Proportionally Consolidated 31 Mar 2013 31 Mar 2014 Loan to Value (LTV) 40% 40% Average Interest Rate 4.6% 4.1% Interest Cover 2.3x 2.5x Average Maturity of Drawn Debt (years) 9.9 8.7 Group 31 Mar 2013 31 Mar 2014 Loan to Value (LTV) 24% 29% Average Interest Rate 4.4% 3.5% Interest Cover 2.8x 3.2x

DIVERSE DEBT FUNDING PROFILE

• £1.5bn of new financing

arranged

• £785m revolving credit facility

with maturity of 5 years and an initial margin of 115bps

• £1.9bn of undrawn facilities for

more than 2 years

• No BL financing required for

4 years

£0.6bn £1.0bn £0.7bn £0.4bn £0.9bn £1.6bn

Unsecured bank debt Debentures & Loan Notes US Private Placements Convertible Bonds JV & funds secured debt Securitisations

10

Diverse Debt Profile (31 March 2014)

MARKET OUTLOOK

• UK at early stages of an economic recovery

– Differential between property bond yields historically wide

• Positive about long-term prospects for London

– Occupational demand picking up and supply remains constrained – Rental growth a key driver of performance – Prime residential pricing slowing but long-term dynamics good

• Retail at an earlier stage in the cycle

– Increased investor interest, yields starting to compress – Retailers increasingly confident about consumer spending and role of physical space – Retailers looking to take more space, but only in best locations

11

OUR PRIORITIES

• Focused on driving rental growth
• Progressing our new development programme
• Continue to reshape our Retail portfolio
• Invest in the portfolio

12

RETAIL & LEISURE

13

LEADING INDICATORS OF RETAIL RENTAL GROWTH IMPROVING

14

• 30
• 20
• 10

0% yoy Rental Growth (%) Consumer Confidence Year Consumer Confidence Prime rental growth

0.0

• 1.5

0%

6.0 4.5 3.0 1.5

Disposable Income (%yoy) yoy Rental Growth (%) Year Disposable Income Prime rental growth Forecast 1) Consumer Confidence from GfK NOP, as of 31 December 2013 – surveys c.2,000 consumers to measure level of optimism about the performance of the economy in the next year 2) yoy% change from Bank of England real disposable income (does not include government services and subsidies), forecast from Goldman Sachs Economics 2013 3) FTSE 350: General retail historic performance by quarter to 31 December 2013

Strong forecasts for Disposable Income Growth2 Continued improvement in Consumer Confidence1

1,500 2,400 2,100 1,800 1,200

0%

2,700

+34% Share price yoy Rental Growth (%) Year Retail FTSE 350 Prime rental growth

Improving retailer performance3

15

• Increasing investor interest in retail

property

• >£3bn of investment deals in Q2

2014, +51% on Q1 2013

• Demand from private equity,
• pportunity funds, institutional and

sovereign wealth

• Yields trending down, but tightened

significantly post Bluewater transaction (NIY 4.1%)

Asset Purchaser Price (£m) NIY % Bluewater (30%), Kent1 Land Sec 696 4.1 Merry Hill (50%), Birmingham Intu 408 5.25 Westfield Centre, Derby Intu 390 6.75 Fosse Park, Leicester Gingko/Crown 346 5.3 The Mall Fund (62%) Cap & Reg 213 6.7 Trinity Walk, Wakefield Orion 160 6.50 Overgate Centre, Dundee L&G 125 7.5 Cambridge Retail Park Standard Life 110 5.4 Eastgate Centre, Basildon HARK/IRCP 89 7.0 Leamington Spa Shopping Park Ignis 72 4.4 Middleton Grange, Hartlepool LaSalle IM 33 8.5 Four Seasons, Mansfield LaSalle IM 25 8.5 The Hart Centre, Fleet POLYTECH 23 10.0 Rhiw Shopping Centre, Bridgend POLYTECH 10 10.5

Source: CBRE 1 Price includes 110 acres of surrounding land, plus full asset management rights , source: company announcement

RETAIL INVESTMENT MARKET GAINING MOMENTUM

KEY RETAIL AND LEISURE HIGHLIGHTS

16

• Continued improvement in our retail returns

– Total returns of 10.7% in FY 2014; stronger second half

• Strength of operational metrics

– Occupancy ahead; consistent outperformance on rental growth and footfall – Continued improvement in Q1

• Successful developments and extensions

– Whiteley and Glasgow Fort trading ahead of expectations

• Continued recycling to reshape our retail portfolio

– £1.0bn gross investment activity over the last year (acquisitions, disposals, development) – Sale of £0.4m of mature assets

• 80

80 160 240

Asset Management & Development Yield Movement Total Valuation

STRONGER RETAIL AND LEISURE PERFORMANCE

• Annual total returns of 10.7%; capital returns 4.6%

17

H2 2012/13 H1 2013/14

£(63)m £(35)m £96m £205m

H2 2013/14

Retail Valuation Drivers

£m

TOTAL VALUATION MOVEMENT H1 2012/13

BROADER AND HIGHER QUALITY OCCUPIER DEMAND

18

Leveraging existing strong retailer relationships Retailers taking

• ut of town

stores Increasing restaurant and leisure offer Significant demand from home improvement

• perators

19

OUTPERFORMING ON FOOTFALL

• BL footfall +2.5% at Q1, outperforming benchmark (down 0.8%)

60 70 80 90 100 110 120 130 140 2010 2011 2012 2013 2014 British Land UK Market

Source: Experian

British Land Footfall compared to Experian Market Benchmark

+1% pa

• -3% pa

19

Index Jan 2010 = 100

British Land Retail Rental Growth vs GDP

20

OUTPERFORMING ON RENTAL GROWTH

20

80 90 100 110 120 130

Mar 01 Mar 02 Mar 03 Mar 04 Mar 05 Mar 06 Mar 07 Mar 08 Mar 09 Mar 10 Mar 11 Mar 12 Mar 13 Mar 14

BL Retail IPD Secondary Retail GDP Index 2001 = 100

UPGRADING OUR RETAIL PORTFOLIO THROUGH DEVELOPMENT – GLASGOW FORT LEISURE EXTENSION

21

46,000 sq ft cinema and restaurant extension Annual footfall up 8% to 12m Catering spend increased more than 50% Average peak retail spend increased to £124 Opened September 2013 Average peak dwell time up to 102 mins Further 112,000 sq ft retail led extension now on site including an 80,000 sq ft M&S anchor store

On

UPGRADING OUR RETAIL PORTFOLIO THROUGH DEVELOPMENT – WHITELEY SHOPPING

22

New 321,000 sq ft shopping destination Annual footfall of 4.7m On site with Phase II 58,000 sq ft cinema and restaurant extension. Increases food & leisure offer to 25% Voted ‘Best mid-sized shopping centre development in Europe’ by ICSC Estimated annual sales of £90m; £5.8m annual rent roll Over 20% valuation uplift

RESHAPING OUR RETAIL PORTFOLIO RE-INVESTING IN PREFERRED DESTINATIONS

23

Focus on well-located, high quality, preferred destinations Increased share in HUT to 60% on an effective NIY

• f 6%

26% equity share in portfolio

• f Sainsbury’s superstores

Reversionary yield of 5.7% Already made a return of

• ver 10%

SouthGate, Bath on a fully let NIY of 5.7%

OFFICES & RESIDENTIAL

24

KEY OFFICE AND RESIDENTIAL HIGHLIGHTS

• Strengthening leasing performance

– Successful letting particularly across our recently completed West End developments

• Successful completion of all our 2010 West End developments

– Plus 605,000 sq ft Leadenhall Building in the City

• Well timed acquisitions of Paddington and Shoreditch

– Third major London campus at Paddington – Adding significant development potential

• Achieved important milestones at Clarges

– Landmark development, on-site, pre-launched with £210m of residential pre-sold

• Progressing our long-term vision at Broadgate

– New JV partnership with GIC – Crossrail a game changer – Broadgate Circle

25

LONDON A LEADING GLOBAL CITY

• London is one of the most important cities

globally

• Population forecast to grow c.1% per

annum over next 10 years

• Office based employment expected to

increase 2.2% pa over the next 5 years – Significantly ahead of other UK and major European cities

• Emerging as leading technology hub

– 2013 London TMT take up greater than Beijing or Silicon Valley – Tech sector forecast to create 51,000 new jobs by 2020 = c.5m additional office space

• Investment market supported by
• verseas buyers

11+ 10 9 8 7 6 5 4 3 2 1 Berlin Beijing Shanghai Geneva Miami Singapore Paris Hong Kong New York London In 10 Years Now Sao Paulo

Rank

Source: Knight Frank Wealth Report 2012, survey of Citi Private Bank’s wealth advisors

26

London to remain the top ranked global City

2 4 6 8 10 12 14 2 4 6 8 10 12 93 96 99 02 05 08 11 14 17

Planning granted Demolition Under construction Completed 10 yr average Grade A take-up 10 yr average take up Vacancy Rate

OFFICE MARKET REMAINS ATTRACTIVE

Central London Supply and Demand Central London Rental Growth

Central London Development Completions m sq ft

• 20

40 60 80 100 120 140 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18 West End City Actual Forecast £ psf

Prime London Office Rents m sq ft

27

% vacancy

• 80

80 160 240 320 400

Asset Management Development Yield Movement Total Valuation

STRONG OFFICE AND RESIDENTIAL PERFORMANCE

• FY 2014 total returns of 19.4%; capital returns 15.5%

28

H2 2012/13 H1 2013/14

£85m £125m £213m £434m

H2 2013/14

Valuation Drivers

£m

TOTAL VALUATION MOVEMENT H1 2012/13

DEMAND FROM A BROADER RANGE OF OCCUPIERS

• Investment lettings/renewals

significantly ahead of ERV

– 8.4% in FY 2014; 5.6% in Q1

• Strong demand from TMT

and insurance

• Increasing interest from

financial services - hedge fund and wealth management

29

Office Leasing Activity by Category in FY 2014

36% 15% 18% 16% 6% 9%

By rent

TMT INSURANCE BANKING & FINANCE BUSINESS & PROFESSIONAL OIL & GAS OTHER

• Strengthening letting interest in recent months
• Over 200,000 sq ft leasing activity completed/under offer in Q1 including at

Leadenhall and 10 Portman Square

• Further leasing successes since Q1 announcement, including at 10 Portman

Square, Marble Arch House, 39 Victoria Street and Paddington Central

LEASING ACTIVITY ACROSS OUR OFFICE PORTFOLIO

30

Leasing Activity FY to 31 March sq ft Completed/under

• ffer since March*

Sq ft Broadgate 225,190 82,300 Leadenhall 106,920 13,600 Regent’s Place 196,480 36,600 Portman Village 18,300 62,000 Paddington Central 30,210 6,300 Other 54,900 16,600 Total 632,000 217,400

* As per Q1 announcement

REGENT’S PLACE – GREAT LETTING SUCCESS

31

15.5% valuation uplift in year Nearly 200,000 sq ft of lettings Increased occupancy to 98.3% New rental high of £71 psf Standing investment ERVs up 11.8% over last 3 years Increasingly reversionary with average office rent of £46 psf Further refurbishment

• pportunities

32

PADDINGTON – GREAT PROGRESS

Campus already increased in value by 11.1% Almost 40% of vacant space let/under offer at rents ahead of ERV Average office rent of £50 psf attractively priced Significant

• pportunities to

develop as major West End campus Transfer our experience from Regent’s Place

2010 LONDON DEVELOPMENT PROGRAMME

• £294m of additional profit generated in FY 2014; £45m to come
• 73% let/under offer securing £54m pa of rent, 96% residential units

sold/under offer

65 167 297 591 192 192 126 45 Mar 11 Mar 12 Mar 13 Mar 14 Profit Taken Profit to Come

£257m £359m £423m £636m

£m

33

4 KINGDOM STREET 5 KINGDOM STREET CLARGES ESTATE

PROGRESSING OUR NEW LONDON DEVELOPMENTS

• Added 1.1m sq ft of new potential development
• Estimated profit of c.£375m; of which c£290m to come
• Expect to commit to 4 Kingdom Street later this year
• Progressing 5 Kingdom Street and Shoreditch plans; retain optionality

34

YALDING HOUSE THE HEMPEL ALDGATE PHASE 1 SHOREDITCH ESTATE

555,000 sq ft

NEAR-TERM PIPELINE RECENTLY COMMITTED

708,000 sq ft

SHOREDITCH ESTATE

BROADGATE – IMPLEMENTING OUR LONG-TERM VISION

35

Corporate Legal

New long-term JV partner with GIC Evolving campus to broaden occupiers and uses Access enhanced by Crossrail in 2018 Development of 5 Broadgate and Broadgate Circle completing shortly Broadgate Circle creates a new food destination for the City Next opportunity will be at 100 Liverpool Street

FINANCIALS

36

37

FY 2014 HIGHLIGHTS

FY to 31 March 2013 2014 Change Underlying Profit before Tax (£m) 274 297 8.4% Underlying Earnings per Share (p) 30.3 29.4 (3.0)% Dividend per Share (p) 26.4 27.0 2.3% Valuation Performance 1.0% 8.3% EPRA Net Asset Value per Share (p) 596 688 15.4% Total Accounting Return 4.6% 20.0%

£m

UNDERLYING PROFIT BRIDGE

274 297 30 8 6 (18) (3)

FY 2013 Placing Investments PC of 2010 Developments Like for Like Prior Year Disposals Other FY 2014

38

39

£m

NET RENTAL INCOME MOVEMENT

562

541 31 13 6 (26) (3)

FY 2013 Placing Investments PC of 2010 Developments Like for Like Retail Recycling Prior Year Disposals Other FY 2014

Like for like UK Retail 3.0% Offices 0.4% Total 2.2%

UK Like for like

596p 688p 27p 36p 29p 29p (27p) (2p)

Mar 13 Developments Offices Retail Underlying Profit Dividends Other Mar 14

NAV (p)

GROWTH IN EPRA NET ASSET VALUE

40

DEVELOPMENT PROGRAMME – RISK MANAGEMENT

• Current development commitment
• f £1.4bn
• Residential commitment below

£500m limit, as previously set

• Development commitment limits:

– 15% of investment portfolio – 10% on a speculative basis

• Capacity to further replenish

pipeline as 2010 developments complete

Development Commitment (at 31 March 2014)

£m

200 400 600 800 1,000 1,200 1,400 Mar 14 Sep 14 Mar 15 Sep 15 Mar 16 Sep 16 Mar 17

Near Term Recently Committed 2010 Committed Developments

41

42

FUTURE INCOME GROWTH

Annualised Gross Rents Cash Flow Basis £m Accounting Basis £m Current Passing Rent 557 584 Expiry of Rent-free Periods 51 Fixed, Minimum Uplifts 13 2010 Non-Completed Developments Pre-let 28 25 Recently Committed Developments Pre-let 7 5 Total Contracted 656 614 Developments – 2010 Committed Developments to let 28 23 Developments – Recently Committed 11 9 Developments – Near-term to let 31 25 Investments – RPI and rent review uplifts 12 12 Investments – Letting of Expiries and Vacancies 21 18 Potential Rent in 5 Years 759 701 Increase 36% 20%

APPENDICES

43

BL UK PROPERTY RETURNS VS IPD – 1 YEAR

44

Year ended 31 March 2014 bps

40 240 140 60 80 60

• 50

100 150 200 250 Retail Offices Total Capital Returns Total Returns

BL UK PROPERTY RETURNS VS IPD – 3 YEARS

45

3 years ended 31 March 2014 bps pa

130 480 250 140 340 190

• 100

200 300 400 500 600 Retail Offices Total Capital Returns Total Returns

46

Yield gap %

UK PROPERTY MARKET- YIELD GAP VS 10 YEAR GILTS

(5) (3) (1) 1 3 5 2 4 6 8 10 12 1990 1992 1994 1995 1997 1998 2000 2001 2003 2004 2006 2007 2009 2010 2012 2014 UK 10 Year Gilt Yield IPD All Property Net Initial Yield

%

MAJOR PROPERTY HOLDINGS

As at 31 March 2014 (excl. developments under construction) BL Share % Sq ft 000’s Rent £m pa1 Occupancy Rate %2 Lease Length yrs3 1 Broadgate, London EC2 50 3,963 177 96.8 7.2 2 Regent's Place, London NW1 100 1,589 70 98.3 9.4 3 Meadowhall Shopping Centre, Sheffield 50 1,448 81 98.0 8.1 4 Sainsbury's Superstores 52 2,864 68 100.0 15.1 5 Tesco Superstores 51 2,808 63 100.0 14.7 6 Paddington Central 100 608 23 94.2 10.1 7 Teesside Shopping Park, Stockton-on-Tees 100 422 15 98.6 7.0 8 Drake Circus Shopping Centre, Plymouth 100 414 16 99.2 6.3 9 Debenhams, Oxford Street 100 363 11 100.0 25.0 10 10 Portman Square, W14 100 134 5 68.2 12.0

1 Annualised contracted rent including 100% of Joint Ventures & Funds 2 Includes accommodation under offer or subject to asset management 3 Weighted average to first break 4 Development reached practical completion in April 2013

47

TOP 20 CUSTOMERS & CUSTOMER SPLIT BY INDUSTRY

48

As at 31 March 2014 % of Total Contracted Rent

Tesco plc 7.7 Sainsbury Group 6.0 Debenhams 5.8 UBS AG 3.2 Home Retail Group 2.7 Kingfisher (B&Q) 2.7 HM Government 2.5 Next plc 2.4 Virgin Active 2.0 Arcadia Group 2.0 Spirit Group 1.6 Alliance Boots 1.6 Herbert Smith 1.4 DSG International 1.3 Marks & Spencer Plc 1.3 Royal Bank of Scotland Plc 1.2 Hutchison Whampoa 1.1 Aegis Group 1.1 House of Fraser 1.0 New Look 1.0

Customer Split by Industry Contracted Rent (%)

20% 19% 16% 14% 13% 8% 7% 2% 1%

General Retail Fashion & Beauty Supermarket Banks & Financial services Professional & Corporate Food / Leisure DIY Government Other Business

PORTFOLIO YIELD & ERV MOVEMENTS

49

As at 31 March ERV NEY ERV Growth %1 NEY Yield Compression bps2 £m % H1 H2 FY H1 H2 FY Retail parks 165 5.7 1.0 0.0 1.0 7 18 25 Superstores 70 5.1 0.5 0.2 0.7 5 3 9 Shopping centres 112 5.5 0.0 2.3 2.4 5 6 11 Department stores 24 5.4 0.1 0.1 0.2 38 58 94 Leisure 21 7.7 2.0 2.6 4.6 6 65 71 Retail 392 5.6 0.6 0.9 1.5 8 18 26 City 98 5.3 1.2 6.6 7.93 9 30 39 West End 137 5.1 2.3 2.3 4.6 16 28 41 Provincial 5 6.1 0.0 0.0 0.0 23 24 47 All Offices 240 5.2 1.7 4.1 5.8 13 29 40 Total 632 5.5 0.9 2.0 3.0 10 22 31

Table shows UK total, excluding assets held in Europe.

1 Like for like (as calculated by IPD) 2 Including notional purchaser’s costs 3 City up 4.0% on a like-for-like basis

PORTFOLIO WEIGHTING

50

As at 31 March 2013 % 2014 (Current) % 2014 (Current) £m 2014 (Pro forma)¹ Retail parks 24.5 23.1 2,767 21.5 Superstores 12.6 11.1 1,321 10.1 Shopping centres 17.6 15.6 1,862 14.4 Department stores 4.6 4.7 564 4.3 Leisure 3.0 2.8 338 2.6 Retail 62.3 57.3 6,852 52.9 City 17.1 17.1 2,038 16.9 West End 18.4 22.7 2,720 25.3 Provincial 0.8 0.8 96 1.7 All Offices 36.3 40.6 4,854 43.9 Residential2 1.4 2.1 245 3.2 All Offices & Residential 37.7 42.7 5,099 47.1 Total 100.0 100.0 11,951 100.0

Table shows UK total, excluding assets held in Europe

1 Pro forma for developments at estimated end value (as determined by the Group’s external valuers) 2 Stand-alone residential

PORTFOLIO VALUATION BY SECTOR

51

Total1 Change %2 As at 31 March 2014 £m H1 H2 FY Retail parks 2,767 1.1 2.7 3.7 Superstores 1,321 2.0 0.7 2.8 Shopping centres 1,862 0.3 1.8 2.1 Department stores 564 6.5 11.1 18.3 Leisure 338 2.0 8.4 10.5 Retail3 6,852 1.5 2.9 4.4 City 2,038 3.6 8.1 11.8 West End 2,720 6.0 10.0 16.6 Provincial 96 4.0 6.6 10.9 All Offices3 4,854 5.0 9.1 14.4 Residential4 245 2.6 13.2 15.4 All Offices & Residential 5,099 4.9 9.3 14.5 Total 11,951 2.8 5.5 8.3 Standing Investments 10,827 2.1% 4.4% 6.6% Developments 1,124 8.9% 16.9% 20.9%

Table shows UK total, excluding assets held in Europe. Total portfolio valuation including Europe of £12.0bn at year end, +8.0% valuation movement

1 Including Group’s share of properties in joint ventures and funds 2 Valuation movement during the period (after taking account of capital expenditure) of properties held at the balance sheet date,

including developments (classified by end use), purchases and sales

3 Including committed developments 4 Stand-alone residential

PORTFOLIO NET YIELDS1

52

As at 31 March 2014 (excl. developments) EPRA Net Initial Yield % EPRA Topped- Up Net Initial Yield %2 Overall Topped- Up Net Initial Yield%3 Net Reversionary Yield % Net Equivalent Yield %

Retail parks 5.3 5.6 5.7 5.6 5.7 Superstores 4.9 5.1 5.1 5.0 5.1 Shopping centres 5.3 5.4 5.4 5.6 5.5 Department stores 5.0 5.0 7.1 4.0 5.4 Leisure 7.1 7.1 8.9 5.6 7.7 Retail 5.3 5.5 5.8 5.4 5.6 City 5.5 5.8 5.9 6.2 5.3 West End 2.9 4.3 4.4 5.3 5.1 Provincial 6.9 6.9 6.9 5.6 6.1 All Offices 4.0 4.9 5.0 5.6 5.2 Total 4.8 5.3 5.5 5.5 5.5

Table shows UK total, excluding assets held in Europe

1 Including notional purchaser's costs 2 Including rent contracted from expiry of rent-free periods and fixed uplifts not in lieu of rental growth 3 Including fixed/minimum uplifts (excluded from EPRA definition)

LEASE LENGTH AND OCCUPANCY

53

As at 31 March 2014 (excl. developments) Average Lease Length (yrs) Occupancy Rate (%) To Expiry To Break Occupancy Occupancy (underlying)1

Retail parks 9.1 8.2 96.8 98.3 Superstores 15.0 14.8 100.0 100.0 Shopping centres 9.1 8.1 95.6 97.3 Department stores 26.6 23.3 100.0 100.0 Leisure 20.7 20.7 100.0 100.0 Retail 12.3 11.3 97.4 98.5 City 9.1 7.3 96.8 96.9 West End 11.2 9.4 85.7 88.4 Provincial 8.3 8.0 100.0 100.0 All Offices 10.2 8.4 90.5 92.1 Total 11.5 10.3 94.8 96.1

Table shows UK total, excluding assets held in Europe

1 Including accommodation under offer or subject to asset management

ANNUALISED RENT & ESTIMATED RENTAL VALUE (ERV)

54

As at 31 March 2014 (excl. Developments) Annualised Rents (Valuation Basis) £m1 ERV £m Average Rent (£psf)2 Total Total Contracted ERV

Retail parks 157 165 24.5 24.6 Superstores 68 70 21.8 21.6 Shopping centres 104 112 30.2 31.9 Department stores 30 24 13.6 10.9 Leisure 25 21 14.1 11.6 Retail 384 392 22.7 22.4 City 88 98 47.5 48.7 West End 76 137 48.4 52.0 Provincial 6 5 27.1 21.9 All Offices 170 240 46.9 49.2 Residential3 3

• All Offices & Residential

173 240 Total 557 632 26.6 27.7

Table shows UK total, excluding assets held in Europe

1 Gross rents plus, where rent reviews are outstanding, any increases to ERV (as determined by the Group’s external valuers), less any ground rents payable under

head leases, excludes contracted rent subject to rent free and future uplift

2 Office average rent £psf is based on office space only 3 Stand-alone residential

200 400 600 800 1,000 1,200

2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037 2038

£m

DEBT MATURITY – GROUP

55

Year to 31 March

British Land facilities proforma for the new £785m revolving credit facility

Debentures & Loan Notes Private Placements Convertible Bonds BL Drawn Facilities BL Undrawn Facilities

£m

DEBT MATURITY – JOINT VENTURES AND FUNDS1

56

1 At British Land share

200 400 600 800 1,000 1,200 2015 2016 2017 2018 2019 2020-2024 2025-2037 Year to 31 March

JV – Bank drawn Funds – Bank drawn JV & Funds – Bank undrawn JV - Securitisations

2010 DEVELOPMENT PROGRAMME

57

As at 31 March 2014 Sector BL Share Sq ft PC Calendar Current Value Cost to Complete ERV Pre-let Resi End Value % '000 Year £m £m1,6 £m2 £m £m3 10 - 30 Brock Street, Regent’s Place4 Mixed Use 100 505 Completed 402 3 20.5 19.1 118 10 Portman Square Offices 100 134 Completed 183 4 9.8 4.9

• Marble Arch House5

Mixed Use 100 87 Completed 70 4 4.4

• 19

39 Victoria Street Offices 100 93 Completed 82 3 5.4

• 199 Bishopsgate

Offices 50 144 Completed 60 1 3.5 2.0

• Whiteley Shopping, Fareham

Retail 50 321 Completed 55

• 2.6 2.4
• Bedford Street

Residential 100 24 Completed 34 1

• 28

Glasgow Fort (Leisure) Retail 59 46 Completed 11 3 0.7 0.7

• The Leadenhall Building

Offices 50 605 2014 265 29 18.9 9.0

• 5 Broadgate

Offices 50 710 2015 251 63 19.2 19.2

• Total 2010 Programme:

2,669 1,413 111 85.0 57.3 165

Data includes Group's share of properties in Joint Ventures & Funds (except area which is shown at 100%)

1 From 1 April 2014 to practical completion (PC) 2 Estimated headline rental value net of rent payable under head leases (excluding tenant incentives) 3 Residential development of which £143m completed or exchanged and a further £16m under offer 4 Includes 126,000 sq ft of residential of which £102m has now sold and completed 5 Includes 10,000 sq ft of residential of which £17m has now sold and completed during the year 6 Cost to complete excludes notional interest as interest is capitalised individually on each development at our capitalisation rate

RECENTLY COMMITTED DEVELOPMENT PROGRAMME

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As at 31 March 2014 Sector BL Share Sq ft PC Calendar Current Value Cost to Complete ERV Pre-let Resi End Value % '000 Year £m £m1,4 £m2 £m £m3 Milton Keynes, Kingston Centre Retail 50 21 Completed 5

• 0.3 0.3
• Old Market, Hereford6

Retail 100 305 2014 66 15 4.8 3.9

• Craven Hill Gardens

Residential 100 25 2014 47 4

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Fort Kinnaird, Edinburgh Retail 29 55 2014 3 3 0.4 0.3

• Broadgate Circle

Offices 50 45 2014 10 8 1.2

• Broughton Park, Chester

Retail 59 54 2014 3 6 0.6 0.6

• Whiteley Leisure, Fareham

Retail 50 58 2014 1 6 0.6 0.4

• Meadowhall Surrounding Land

Retail 50 22 2015 1 3 0.4 0.4

• Glasgow Fort, M&S & Retail Terrace

Retail 59 112 2015 1 20 1.6 0.7

• Deepdale, Preston

Retail 29 71 2015 1 4 0.4 0.4

• Yalding House

Offices 100 29 2015 11 12 1.5

• The Hempel

Residential 100 40 2016 44 26

• 92

Aldgate Place, Phase 15 Residential 50 221 2016 16 45

• 65

Clarges Mayfair7 Mixed Use 100 195 2017 213 183 5.7

• 449

Total Recently Committed: 1,253 422 335 17.5 7.0 664 Total Committed under construction: 2,547 933 427 55.3 34.9 664

Data includes Group's share of properties in Joint Ventures & Funds (except area which is shown at 100%)

1 From 1 April 2014 to practical completion (PC) 2 Estimated headline rental value net of rent payable under head leases (excluding tenant incentives) 3 Residential development of which £5m completed or exchanged 4 Cost to complete excludes notional interest as interest is capitalised individually on each development at our capitalisation rate 5 Residential end value excludes hotel site, receipts of £6 million (BL share) estimated 6 Completed post year end 7 Includes 104,000 sq ft of residential

NEAR-TERM AND PROSPECTIVE DEVELOPMENTS

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As at 31 March 2014 BL Share Sq ft Total Cost Status % '000 £m1 Near-term Pipeline Blossom Street, Shoreditch Mixed Use 100 322 164 Pre-submission 5 Kingdom Street2 Offices 100 240 162 Consented 4 Kingdom Street Offices 100 147 99 Consented Glasgow Fort (Restaurant & Car Park) Retail 59 10 5 Consented Total Near-term 719 430 Medium-term Pipeline 100 Liverpool Street Offices 50 512 Pre-submission Power Court, Luton Retail 100 149 Pre-submission Aldgate Place, Phase 2 Residential 50 145 Consented Drake Circus Leisure Retail 100 105 Pre-submission Fort Kinnaird, Edinburgh (Debenhams) Retail 29 30 Pre-submission Glasgow Fort (Additional Retail Unit) Retail 59 30 Consented Lancaster Retail 100 300 Pre-submission Eden Walk Shopping Centre, Kingston Mixed Use 50 500 - 600 Pre-submission Surrey Quays Mixed Use 100 1,500 - 2,000 Pre-submission Harmsworth Quays Mixed Use 100 1,000 - 1,500 Pre-submission Total Medium-term 4,271 - 5,371

1 Total cost including site value 2 210,000 sq ft of which is consented

RESIDENTIAL DEVELOPMENT PROGRAMME

As at 31 March 2014 Sq Ft '000 No. Market Units PC Date/ Status BL Share % Mar 14 Value £m Cost To come1 £m Total £m Sales Exchanged £m

Mixed-use: The Triton Building2 126 94 Completed 100% 22 1 23 102 Marble Arch House 11 10 Completed 100% 5 1 6 17 Clarges Mayfair3 104 36 Jul-17 100% 169 151 320

• Mixed use

241 140 196 153 349 119 Resi-led: Bedford Street4 24 17 Completed 100% 34 1 35 24 Craven Hill Gardens 25 15 Aug-14 100% 47 4 51 5 The Hempel 40 19 Jan-16 100% 44 26 70

• Aldgate Place Phase 1

221 154 Jun-16 50% 16 45 61

• Resi-led

310 205 141 76 217 29 Aldgate Place Phase 2 145 Consented 50% Harmsworth Quays 1,000-1,500 Pre-submission 100% Medium term prospective 1,145 – 1,645 Total Committed Residential 551 345 337 229 566 148

Data includes Group's share of properties in Joint Ventures & Funds (except area which is shown at 100%)

1 From 1 April 2014 to practical completion (PC) 2 Includes 51,000 sq ft of affordable housing (68 units) 3 Includes 9,500 sq ft of affordable housing (11 units) 4 Includes 10,000 sq ft of retail space

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CLARGES MAYFAIR

REGENT’S PLACE CAMPUS

62

63

Key: BL ownership Non BL ownership

FIVE KINGDOM STREET

FOUR KINGDOM STREET

ONE KINGDOM STREET ONE SHELDON SQUARE

PADDINGTON CENTRAL CAMPUS

Development sites (355,000 sq ft) + Crossrail box below (80,000 sq ft) 206 room 4-star hotel (111,000 sq ft) 88,000 sq ft retail (16 units) around Sheldon Square 200 residential units sold on long leases; retail at ground floor Multi-let offices 268,000 sq ft Multi-let offices 143,000 sq ft New Hammersmith & City line station and access to Crossrail Non BL ownership

BROADGATE CAMPUS

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DISCLAIMER

The information contained in this presentation has been extracted largely from the Full Year Results Announcement for the year ended 31 March 2014. This presentation may contain certain “forward-looking” statements. By their nature, forward-looking statements involve risk and uncertainty because they relate to future events and circumstances. Actual outcomes and results may differ materially from any outcomes or results expressed

• r implied by such forward-looking statements. Any forward-looking statements made by or on behalf of British Land speak only as of the date they

are made and no representation or warranty is given in relation to them, including as to their completeness or accuracy or the basis on which they were prepared. British Land does not undertake to update forward-looking statements to reflect any changes in British Land’s expectations with regard thereto or any changes in events, conditions or circumstances on which any such statement is based. This presentation is made only to investment professionals as defined in Article 19 of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 ('the FP Order'). The content of this presentation has not been approved by a person authorised under the Financial Services and Markets Act 2000 (“FSMA”). Accordingly, this presentation may only be communicated in the UK with the benefit of an exemption set

• ut in the FP Order. An investment professional includes:

(i) a person who is authorised or exempt under FSMA; and (ii) a person who invests, or can reasonably be expected to invest, on a professional basis for the purposes of a business carried on by him; and (iii) a government, local authority (whether in the United Kingdom or elsewhere) or an international organisation; and (iv) any director, officer, executive or employee of any such person when acting in that capacity. This presentation is published solely for information purposes. This presentation does not constitute an offer to sell or the solicitation of an offer to subscribe for or buy any security, nor a solicitation of any vote or approval in any jurisdiction, nor shall there be any sale, issuance or transfer of the securities referred to in this presentation in any jurisdiction in contravention of applicable law. No representation or warranty, either express or implied, is provided in relation to the accuracy, completeness or reliability of the information contained herein. The distribution of this presentation in jurisdictions other than the UK may be restricted by law and therefore any persons who are subject to the laws of any jurisdiction other than the UK should inform themselves about, and observe, any applicable requirements. This presentation has been prepared for the purpose of complying with English law and the City Code and the information disclosed may not be the same as that which would have been disclosed if this presentation had been prepared in accordance with the laws of jurisdictions outside the UK. All opinions expressed in this presentation are subject to change without notice and may differ from opinions expressed elsewhere.

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