Ritblatt to step down at British Land

Sir John Ritblat will end his long and distinguished career at the head of one of the country's leading property developers at the end of this year.

Morningstar.co.uk Editors 14 July, 2006 | 4:28PM
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He announced his intention of quitting at today’s AGM but he is not severing his links entirely because the board has elected him honorary president.

Chris Gibson-Smith, currently senior independent director, becomes deputy chairman now and chairman on 1 January.

Ritblatt told shareholders: ‘We have come a long way. When I took over Union Property, the precursor of British Land, in 1969, it had assets of just £6m and a share price of a few pennies - old pennies at that. Now we have assets owned and managed in excess of £18bn and net assets per share of some £15.

The handover means that new blood will be in charge for British Land’s switch to becoming a Reit, or real estate investment trust, the new type of property investment vehicle.

Deputy chairman Sir Derek Higgs and chief operating officer John Weston Smith stepped down today.

British Land has said that it intends to convert to a Reit when the tax rules are finalised and legislation is passed.

Ritblat said British Land's 2006/7 financial year to next March, his 36th with the company, is ‘off to a thoroughly robust start’. He added: ‘The property investment market remains strong, particularly for the prime properties in which we specialise.’

A further significant step in the European business had been taken with the purchase of a 50% interest in a 2.1 million sq ft mixed retail and leisure development at Zaragoza, Spain.

Last week British Land paid £253m to buy out the other half of joint venture BL Davidson, which has gross assets worth more than £700 million in prime UK retail warehousing, retail, and Central London offices.

Several disposals within the UK are going ahead, all at prices higher than last March's valuation.

Ritblat noted signs of greater discrimination among investors as they review growth prospects. Occupiers, too, are becoming more discerning.

He said: ‘The demand from the stronger tenants for quality buildings in good locations continues unabated.’

The shares eased 13p to 1286p today but they are still near their peak and they have enjoyed a good run up from below 500p since the stockmarket hit the bottom in 2003. The forward PE is 32 times, which is not excessive for the sector.

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