British Land reinstates dividend as performance improves

British Land reinstated its dividend after performance at its retail assets improved following the Covid-19 lockdown.

The commercial property company said it would announce an interim divided in November and that payouts would be 80% of underlying earnings per share. It will pay the dividend twice a year instead of quarterly.

British Land suspended the dividend in March to protect its finances as much of the UK economy shut down to stem the spread of Covid-19. The FTSE 100 company said performance measures at its buildings had improved since non-essential retailers were allowed to reopen in June.

British Land said: "Like many businesses, we continue to face challenges as a result of the Covid-19 pandemic, but we also recognise the importance of the dividend to shareholders. We benefit from the strong financial position we have established over several years, a unique and world-class portfolio of real estate and are reassured by the improving operational performance of our assets over recent months."

The company is reviving the payout as the economy heads for further choppy waters. Fears of a further national shutdown are increasing as large parts of the country are put into local lockdowns. Unemployment is also expected to rise rapidly.

The owner of Sheffield's Meadowhall shopping centre said all its retail assets and 86% of shops were open. Footfall was 84% of the year before in September and like-for-like retail sales were 90% of the year-earlier figure.

Retail company voluntary arrangements and administrations have increased, costing British Land £11.6m in annual rents. A further 16 tenants are operating under a CVA or administration, it said.

British Land's offices in London, which include Broadgate in the City, have stayed open but use has remained low, it said. Occupancy reached 18% of pre-Covid levels in mid-September and have stayed at that level. The government withdrew its plea for people to return to offices in September as coronavirus cases rose.