Pandemic payouts

Just because British Land can pay a dividend again does not necessarily mean that it should

Ben Marlow

COMMERCIAL landlord British Land will resume paying dividends after reporting an improvement in footfall and rent payments.

The FTSE 100 company will pay out dividends twice a year, set at a level of 80pc of underlying earnings, with the first payout in November. Prior to the pandemic, it paid out four times a year.

British Land reported footfall at some of its retail sites was around a fifth ahead of its estimates, with especially strong numbers in retail parks, which make up nearly half of its shopping sites. Sales from its retail sites are now back to 90pc of their level a year ago, it added.

Only half of retail space rent was collected for September, but this marked an improvement from June, when 36pc was received. Across its total estate of offices and shops, British Land collected 72pc of rent in September, although this figure could rise as it chases tenants.

British Land revealed it had lost £11.6m in annualised rent via company voluntary arrangements, which allow tenants to rewrite their leases if they can get approval from three quarters of creditors. Sixteen occupiers are operating on agreed terms on CVAS, with 77pc operating on reduced rents and 16pc having closed altogether.

Fewer than one in five London office workers have returned to their desks, according to British Land’s data, but 95pc of offices in the capital are currently let out. Office rent payments remain strong, with 97pc of rent collected in September.

It said: “Longer-term, Covid-19 will undoubtedly cause many businesses to consider how to use their space most productively, but our conversations suggest there is a consensus that highquality office space will remain key to enable them to perform at their best.”