Half-yearly report 2011

Our performance

Pre-tax profit

£378.9m

Our pre-tax profit for the six month period includes a £211.5m
revaluation surplus.

Total dividend

14.4p

The first half dividend of 14.4p, up 2.9%, is consistent with our expectations outlined in May 2011.

Revenue profit

£159.3m

Underlying profit before tax - the increase over the prior period included some £13m of
non-recurring items.

Net assets per share
863p up 4.5%
Valuation surplus
2.1%
Investment portfolio performance relative to IPD
1.0%outperformance

Combined portfolio value
£10.81bn

Go to our Performance highlights

Making good progress...

It has been a very busy six months. See how some of our key developments are progressing.

At its peak, this 75,900 m² retail scheme has seen more than 1,000 construction workers on site, with activity focused on the completion of the main framework.

Trinity Leeds, May 2011

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With almost all of the 1,902 glass roof panels now installed and 60.7% pre-let or in solicitors' hands, we are right on track to open in spring 2013, taking Leeds
up the UK retail rankings.

Trinity Leeds, November 2011

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Spring visitors to the site of this striking mixed use scheme would have seen intense work going on to complete piling - all part of our plans to transform Victoria.

Buckingham Gate, SW1, May 2011

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We have moved from piling to pouring, so the 13 storeys of this prism-shaped building will now start to take shape as we progress towards our
completion date - April 2013.

Buckingham Gate, SW1, November 2011

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This Rafael Viñoly-designed scheme will soar above the City's streets, but back in May it was a huge hole filled with teams pushing to complete ground works.

20 Fenchurch Street, EC3, May 2011

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Now rising day by day, our 64,580 m² building is right on schedule for completion in April 2014, when it should help to meet demand in increasingly
supply-constrained conditions.

20 Fenchurch Street, EC3, November 2011

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Retail Portfolio review

Valuation surplus
1.1%
Lettings in the period
£8.9m
Like-for-like portfolio voids reduced from 4.7%
3.6%

Retail Portfolio by capital value
£4.89bn

Retail Portfolio by capital value - £4.89bn

Top 3 properties

1. White Rose
Leeds

2. Gunwharf Quays
Portsmouth

3. Cabot Circus
Bristol

Buchanan Galleries

Glasgow

Trinity

Leeds

St David’s

Cardiff

Cabot Circus

Bristol

Princesshay

Exeter

Go to Retail Portfolio highlights

London Portfolio review

Valuation surplus
2.9%
Lettings in the period
£13.7m
Property sales, 15.6% ahead of March 2011 valuation
£93.9m

London Portfolio by capital value
£5.92bn

London Portfolio by capital value - £5.92bn

Top 3 properties

1. Cardinal Place
SW1

2. New Street Square
EC4

3. One New Change
EC4

Piccadilly Circus

Bankside 2&3

SE1

Fenchurch St.

EC3

Queen Anne’s Gate

SW1

Times Square

EC4

Go to London Portfolio highlights

Outlook

Retail Portfolio outlook

Consumer behaviour is changing which will contribute to the on-going disparity of performance between winners and losers in terms of retailers, locations and property assets. We understand these dynamics and our strategy is well-matched to the changes taking place.

London Portfolio outlook

The key drivers of supply and demand for new offices remain broadly consistent with those we set out in 2010. However, we remain alive to changes in the market and will continue to manage our development programme and future pipeline actively.

The retail outlook remains challenging and, in the absence of market-wide rental value growth, the onus is on property owners to actively manage assets to create value. It is clear that with the larger than anticipated fall in household disposable income, pressures on retail sales have increased and there is a greater risk of insolvency amongst retailers.

Fundamental to our approach to mitigating this will be the quality of our portfolio and our close relationships with retailers and leisure operators. We seek to understand their changing needs and requirements and plan our asset initiatives and developments accordingly. We also anticipate that the uncertainty in capital markets may generate some attractive buying opportunities.

Go to Retail Portfolio review

"The drivers of demand that we set out in 2010 when we first restarted our development programme are:
High levels of lease expiries from 2013; Prospective occupiers using the end of leases to rationalise estates and move to buildings which are fit for today's corporate requirements; and limited supply of new space.

While current conditions point to lower levels of take up and are impacting the time that it takes for decisions to be made, the dynamics outlined above are still applicable. We are encouraged by the interest in our three remaining speculative schemes on site at 20 Fenchurch Street, EC3, 123 Victoria Street, SW1 and 62 Buckingham Gate, SW1. However, we remain alive to changes in the market and will continue to manage our development programme and future pipeline actively, as we did with the sales of Park House, W1 last year and, more recently, 110 Cannon Street, EC4."

Go to London Portfolio review

Our strategy, vision and team

Our strategy is simple: to be at the forefront of meeting the space requirements of our customers and to provide an attractive total return for our shareholders. We focus on the two largest segments of the UK commercial property market - retail and London offices - which gives us a broad range of opportunities and a high-quality tenant base.

Our vision, 'Shaping the future of property', highlights our ambition to set the standards for tomorrow in our industry. Whatever we do, we aim to lead our sector, not follow.