Investment Column: British Land looking cheap

WHILE THE rest of the stock market enjoys uninterrupted optimism, the poor old property sector can only stand on the sidelines and watch. British Land is one of the best-managed property groups. But even yesterday's announcement of record pre-tax profits at pounds 127m, up 39 per cent, could not shift the share price from an 18-month low. Yesterday, the shares slipped 4.5p to 665.5p.

Property values rose by a promising 12.8 per cent in the12 months to 31 March, compared to 5.9 per cent last time. Net assets per share grew from 478p to 592p, also an all-time high. Total properties, including British Land's joint ventures are now worth pounds 5.8bn with annualised gross rents of pounds 353m.

The key to British Land's operational success has been a series of well- timed joint ventures. The company started with Scottish & Newcastle and moved heavily into supermarkets with Tesco. British Land's chairman, John Ritblat, clearly has other joint ventures in mind. But in line with his tight-lipped policy, no-one will be given an inkling until a firm deal is done.

One of the most interesting could be a tie-up with Railtrack. The companies are looking at developing the last section of Broadgate together. Analysts have pencilled in a net asset value of 592p for this year which makes the company look cheap at its present price. Buy.