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British Land has increased its earnings guidance after strong demand for office space from artificial intelligence and technology firms boosted rental growth across its London campuses. Leasing activity from companies such as Anthropic and the presence of global players like OpenAI have supported occupancy and pricing, offsetting weaker demand from traditional office users. The company also reported improved occupancy levels and steady performance across its key office assets. However, growth in retail and logistics segments has moderated compared to last year. The revised outlook reflects continued momentum in London’s emerging technology-driven office market.
Real estate developer British Land has raised its earnings guidance after witnessing strong leasing demand from artificial intelligence and technology firms across its London office campuses. Advertisement
The company reported that growing interest from AI-focused occupiers led to double-digit rental growth in its campus portfolio. London has been strengthening its position as a global technology hub, with firms such as OpenAI expanding their presence in the city. This trend has helped balance reduced office demand from traditional sectors that have cut back on space due to hybrid working models.
At its Regent’s Place campus, British Land leased around 158,000 square feet of office space to Anthropic, marking its sixth agreement with the AI firm. The deal reflects the company’s ongoing expansion in the UK. The campus also houses occupiers such as Gilead Sciences, indicating a mix of technology and life sciences tenants.
Chief Executive Simon Carter stated that the company is seeing rising demand from a new group of AI and innovation-led occupiers, particularly in a market where quality office supply remains limited. This shift has contributed to stronger leasing momentum across its portfolio.
British Land, which operates major office campuses including Broadgate, Regent’s Place and Paddington Central, reported that occupancy increased to 95% at the end of March, up from 92% six months earlier. Most of the remaining vacant space is in newly completed buildings, where demand is currently the strongest.
Rental growth across its campuses rose by 12% on a like-for-like basis for the year ended March, contributing to an overall net rental growth of 6%. In comparison, its retail and London urban logistics segments recorded slower growth of 2%, down from 5% in the previous year, as occupancy levels stabilised across retail parks.
On the financial front, the company expects underlying earnings to reach 28.9 pence per share for the current fiscal year, slightly above its earlier estimate of 28.5 pence. It has also revised its earnings outlook for the next fiscal year to at least 30.5 pence per share, supported in part by the completion of its Life Science REIT acquisition.
The company’s shares also saw a modest increase of around 2% following the announcement, reflecting investor confidence in the improving demand outlook for office assets linked to the technology sector.
Source Reuters
5th Jun, 2025
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