Work on British Land PLC’s (LON:BLND) £200mln redevelopment near Euston station in London is set to kick off early next year after the property company finalised terms on the pre-let of the office space.
Digital communications group Dentsu Aegis Network has agreed to take the majority of the eight-storey, 366,000 sq ft office block at One Triton Square, which is just round the corner from its current base.
READ: Deutsche Bank boosts British Land with upgrade to 'buy' from 'hold' in UK real estate review
Planning consent has already been granted by the London Borough of Camden and British Land expects work at the site to get underway in March 2018.
The redevelopment of One Triton Square marks the next phase in the “evolution” of Regent’s Place – a 13-acre campus which is home to the UK offices.of the likes of Facebook, Santander and Debenhams.
“I am delighted that we have agreed one of the largest pre-lets in the West End in over 20 years with Dentsu Aegis demonstrating the strength of demand for high quality, well-located space,” said head of offices Tim Roberts.
Net asset value rises in opening six months
News of the pre-let and subsequent start-date come as British Land reported a rise in net asset value, adding to signs that the UK commercial property market – particularly in London – is holding up well.
EPRA net asset value – a key industry metric that reflects the value of a firm’s buildings – rose 2.6% to 939p per share in the six months ended September 30.
The firm, which owns various plots of land throughout the UK including the Meadowhall shopping centre, saw profits slip slightly to £199mln (H1 16/17: £198mln).
Still, the developer increased its half-year dividend by 3% to 15.04p per share.
“British Land has delivered a strong first half performance as a result of our high level of successful activity and firm capital discipline,” said chief executive Chris Grigg.
“British Land's continuing focus on three major London campuses has underpinned strong occupier demand during the period,” the company added.
Shares opened 1.8% higher at 607p on Thursday.