Chief executive Ian Henderson said that while rental growth had been satisfactory or better, valuation yields have risen reflecting increasing wariness from investors about future growth prospects. And this has hit capital values, especially in shops and shopping centres where institutional investors have moved from being net buyers to net sellers.

The strong performance of central London offices--amounting to one third of Land Securities' portfolio, cancelled out the valuation losses on the retail holdings, which make up over 43% of the holdings. Overall, the portfolio was valued by Knight Frank at £7.9 billion ($11.3 billion), showing an uplift of 3.9%.

Strategically, Land Securities is looking to transform itself from a manager of assets into a service provider to corporate property owners. Its acquisition of the outsourcing specialist Trillium has now been completed, and the division has added the property assets of British Telecom and the BBC to the UK government's DSS portfolio that it already managed.