contraction of businesses in London and very much alert to the possibility of more supply arising as a result.

The outlook therefore is growing supply and contracting demand, which means rents are likely to continue to weaken across London. Our aim in this occupational market, which although subdued is not moribund, will be to continue to attract and retain occupiers in our prime Grade A buildings.

In summary, we anticipated the cycle by carrying out significant sales, our development programme has been much reduced and we have made good progress in achieving pre-lets. Our investment portfolio is aimed at meeting our customers requirements: it is modern, flexible and well located. Leases have an average length of 12 years, or 10 years to first break and, excluding our asset management initiatives, only 4% of current rents are subject to expiry or break over the next 3 years, representing important security of income. Occupancy across the portfolio is high at 94%. This is reduced from 99% at March 2008 due to the completion of 201 Bishopsgate and Broadgate Tower; if these buildings (and our asset management initiatives) are excluded the current occupancy rate is over 99%. Accordingly, the office accommodation we have available to let is nearly all new Grade A quality.

At British Land the prime offices portfolio is well positioned to see through the weaker markets and we remain positive regarding London’s competitive advantages as a global financial and services centre.

Financing and Cash Flow

The management actions taken have given us exceptional asset based cash flow strengths and financing structure, managed together to achieve the most effective result.

British Land’s prime property assets generate secure long term contracted rental income. The weighted average lease length is over 13 years. If no other management action is taken (and if all tenants with a break clause in their leases choose to exercise them) in 5 years (March 2013) 92% of our rents will continue to be contracted.

This reliable cash flow is increased under lease terms which contractually provide for growth in income at regular rent reviews. In outline, of our total UK rent roll including our share of Funds and Joint Ventures:

• 97% are subject to upward only reviews, usually every five years (with reviews across the portfolio well spread over the next five year period);
• 22% of these are also subject to rpi-linked, fixed or minimum uplifts. £48 million further income will be added to the rent roll on the expiry of current rent free periods and when minimum rental increases become effective under existing leases. (It should be noted that accounting policies under IFRS require that portions of these contracted increases are anticipated in the Group’s income statement.);
• less than 2% are from short term leases;
• less than 1% are related to the occupier’s turnover; and
• over 95% of the September 2008 quarter rents were collected within 5 working days of the due date, in line with our previous collection rates.

A wide spread of good tenant covenants contributes to the security of our income. No single entity accounts for more than 7% of the total rents. The top 10 office tenants include major international banks, firms of lawyers and HM Government, accounting for 22% of the rent roll. Top 10 retail tenants include the largest food operators, department stores and fashion/homeware retailers and provide 27% of rents.