LandSec sales spree reduces debt burden

Retail developer-investor Land Securities, which owns shopping centres and parks in Liverpool and Chester, today issued a positive trading statement which showed reduced debt thanks to £357.4m of asset sales in the first quarter of 2009.

The sales reflected an average yield of 7.7%. There have been further sales of £162.0m of property since 30 June at 2.5% below March 2009 valuation, at an average yield of 7.4%.

The developer said there was £73.8m expenditure during the quarter on developments and portfolio capex. Net debt (including joint ventures) is down 5.3% to £4,482.6m from £4,732.6m.

LandSec owns Clayton Square and St Johns Shopping Centre in Liverpool, the former recently underwent a cosmetic refurbishment and the latter is set for a £100m rebuild in the coming years. LandSec is also in the process of investigating a joint venture with ING Real Estate at Northgate in Chester. The company already owns the Greyhound Retail Park on the outskirts of Chester.

The company reported £6.6m a year of lettings completed in the quarter including £2.3m a year of development lettings.

Units in administration within the like-for-like portfolio down from 3.7% at 31 March to 3.3% at 30 June 2009. Voids in the like-for-like portfolio 5.1% at 30 June (4.6% at 31 March).

Francis Salway, chief executive, said: "Our actions and the market trends have been consistent with our statements since the turn of the year. This has contributed to achievements during the quarter in line with our plans and leaves us well positioned for the next stage of the cycle.

"With a strengthened balance sheet we are now assessing opportunities for new investment. We maintain our view that patience is a virtue and that opportunities will arise over years not just months, particularly in terms of disposals by banks. We are confident that our financial flexibility and scale will give us competitive advantage to capitalise on these opportunities as the cycle turns."

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