Thursday, May 17, 2012

Eurozone debt crisis hurting demand for London offices, says Land Securities

Robert Noel, chief executive, said that businesses were reluctant to commit to new office space because uncertainty about the European economy has ?weighed heavily? on business confidence.

Mr Noel said: ?In London, uncertainty in the eurozone weighed heavily on business confidence, leading to lower demand than expected for office space.

?However, particularly low levels of development, coupled with the high number of lease expiries due from 2013 and evolving occupier needs mean the market will see supply-constrained conditions.

?Due to subdued business confidence, these conditions are taking longer to appear than first thought, but once here they should continue for longer.?

The uncertainty in the economy meant that Land Securities? property portfolio, which includes Cabot Circus shopping centre in Bristol, the White Rose in Leeds, and One New Change in the City, grew at a slower pace than last year.

In the year to March 31, values grew by 2pc, compared with 9.7pc last year. This meant pre-tax profits slipped 58pc to ?515.7m.

Shares in the company fell 1.5pc to 723.31p in early trading.

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