British Land sees occupancy rates hold steady ahead of UK Brexit talks

Property giant British Land reported robust occupancy rates in its buildings, indicating that demand was holding up ahead of the UK's exit from the European Union.

It posted an occupancy rate of 97%, with a weighted average lease length of eight years in the three months to the end of December. By comparison the occupancy rate was 98%, with a lease length of nine years during its first half of the year.

The business, which manages £19bn of UK commercial property, said sales to retailers was up 0.6% during its third quarter trading period, although retail footfall fell 0.6%. It said both measures "outperformed" industry benchmarks.

The group added it let 314,000 square feet of retail space, 8.7% ahead of estimated rental value. It also has 189,000 square feet under offer.

British Land co-owns the renowned 45-storey City skyscraper nicknamed the Cheesegrater opened four years ago, while its rival Land Securities owns the competing Walkie Talkie tower in the Square Mile.

British Land added it has let 51,000 square feet of office space at its £130m Mayfair building as 7 Clarges Street, which it bought in 2012. It said the building was now 80% let or under offer at an average rent of £113 per square foot.

Chief executive Chris Grigg said: "We have completed over 400,000 square feet of lettings across the business and are progressing discussions with a broad range of occupiers.

"The business is well placed; we remain mindful of potential headwinds going forward."

The firm added it sold £119m of non-core retail and office buildings during the period, which was 2% ahead of valuations taken in September.

The UK's £900bn commercial property market has largely recovered from the turmoil that followed June's Brexit vote, which at one point saw property funds worth over £18bn suspended.