AFP, London :
Real estate giants British Land and Land Securities sank into the red in the first half of 2016, partly hit by sliding commercial property prices after the shock Brexit vote.
British Land said Wednesday that it suffered a pre-tax loss of o205 million ($255 million, 238 million euros) in the six months to September after a year-earlier profit of o823 million.
The firm, one of Europe’s largest publicly listed real estate companies, said the loss was “primarily due to a negative property valuation movement” in the wake of Britain’s EU exit referendum on June 23.
“Uncertainty caused by the UK’s vote to leave the European Union has resulted in the central London office market registering its first capital value declines since 2009 following several years of strong growth in both rents and values,” it said.
“We recognise the impact that this uncertainty is having on businesses in London, and their ability to make plans for the future, but we believe that London will endure as a global centre.”
The group acknowledged however that Britain’s changing relationship with Europe “may mean that some occupiers have no choice but to relocate certain parts of their businesses to other financial centres throughout Europe”.
But it insisted that growth sectors like creative and technological industries would “absorb much of the additional space but we do expect a period of softening demand in the meantime”.
Real estate giants British Land and Land Securities sank into the red in the first half of 2016, partly hit by sliding commercial property prices after the shock Brexit vote.
British Land said Wednesday that it suffered a pre-tax loss of o205 million ($255 million, 238 million euros) in the six months to September after a year-earlier profit of o823 million.
The firm, one of Europe’s largest publicly listed real estate companies, said the loss was “primarily due to a negative property valuation movement” in the wake of Britain’s EU exit referendum on June 23.
“Uncertainty caused by the UK’s vote to leave the European Union has resulted in the central London office market registering its first capital value declines since 2009 following several years of strong growth in both rents and values,” it said.
“We recognise the impact that this uncertainty is having on businesses in London, and their ability to make plans for the future, but we believe that London will endure as a global centre.”
The group acknowledged however that Britain’s changing relationship with Europe “may mean that some occupiers have no choice but to relocate certain parts of their businesses to other financial centres throughout Europe”.
But it insisted that growth sectors like creative and technological industries would “absorb much of the additional space but we do expect a period of softening demand in the meantime”.
