July 21, 2010 7:08 pm

LandSecs restarts stalled project

Land Securities, the UK’s biggest property company, will start development of the first large shopping scheme since the recession struck in a sign of confidence in the future strength of the regional retail market.

Land Securities said on Wednesday that the £350m ($532m) Trinity Leeds shopping scheme would be finished by 2013. The centre had been mothballed in 2008, and the company had been expected to restart the scheme this quarter, having secured enough initial lettings. It is already almost half let, with retailers including TopShop, H&M, and Next.

Trinity Leeds is part of a wider push by Land Securities to begin schemes stalled during the credit crunch in the expectation of improving tenant demand when they complete in the next few years.

The company’s focus has been on London so far, where it has started office schemes in the West End, and is in the final stages of agreeing a joint venture with Canary Wharf to build its “Walkie-Talkie” skyscraper. It forward sold one development, Park House, for £250m, which will see it also retain a profit share on completion.

Francis Salway, chief executive, was confident about the longer outlook for offices in London in spite of signs the lettings market could have slowed .

Debt costs have been cut from 5.3 per cent in March, to 5 per cent, and the first-quarter dividend was maintained at 7p. Shares rose 8½p to 589½p, trading at an 18 per cent discount to last reported net asset value.

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