RETAIL EVENT

7 OCTOBER 2011 www.britishland.com Char lie MMdlaudsley Head of Retail One of the UK’s Largest Retail Landlor ds

£9.9bn UK Retail Assets Under Management Department Stores • 23m sq ft ‐ 202 UK assets 8% • Largest investment owner of 13% superstores • Largest owner/manager of retail 45% hall

ww 12% parks • Owner/manager of one of six Meado 22% super regional shoppin g centres

Manage 17% of IPD All Retail; 6% of UK Retail Universe

3 Key Messages

• A Portfolio suitable for the modern retail environment – Delivering for occupiers – Delivering for shareholders

• The right approach – Quality team, asset management and driving total returns

• Defensively positioned for today …. Well positioned for future growth

Delivering Superior Total Property Returns from Retail

4 Tod’day’s Agenda

Overview Charlie Maudsley Asset Management Approach Ben Grose Superstores Bryan Lewis Break Retail Warehouses John Maddison Shopp ing CtCentres Cla ire BbBarber Development Richard Wise Outlook Charlie Maudsley Questions & Answers Fort Tour

5 British Land ‐ A High Quality Portflfolio

Offices ‐ Regent’s Place UK Retail ‐

Delivering Superior Total Returns

6 Delivering Superior Total Returns

1. StiblSustainable and growing income

2. Assets which protect and grow capital value

3. Creating incremental value

4. Controlling costs

5. Exploiting our scale and financial strength

British Land’s Objective is to Deliver Superior Total Returns For Our Shareholders 7 Our Retail Strategy

1. AAtictivel y manage our prime portfo lio

2. Invest in high qyquality prime assets

3. Invest in good quality secondary with good fundamentals

4. Recycle capital where values not justified by rental prospects

5. Increase exposure to assets where we can create incremental value

Balancing Income and Capital Value Growth

8 Retail Portflfolio Consistently Outperforms

BL Retail ERV Growth Relative to BL Retail Total Returns Relative to IPD All Retail IPD All RilRetail % % 2.0 3.0

1.5 2.0 101.0 1.0 0.5

0.0 0.0 1 year 3 years 5 years 1 year 3 years 5 years

Source: IPD

Reflects the Quality of Our Portfolio and Strength of Team

9 A Portflfolio Delivering for Occupiers ‐ Diversity

UK Retail Investment Market Share Total Market IPD British Land £163bn £67bn £9.9bn DepartmentDepartment Stores Stores & High 100% Streetand High Street Shops SuperstoresSuperstores 80%

ShoppingShopping Centres Centres 60% FashionFashion Parks Parks 40% RetailRetail Warehouses Warehouses (exc. 20% Fashion(exc. Fashion Parks) Parks)

0%

Growth in Online Providing New Formats

10 APortflfolio Delivering for Occupiers – Consumer Choice

Convenience Shop Food Experience Shop

Tesco

Consumers Looking for Different Shopping Experiences

11 A Portfolio Delivering for Occupiers ‐ Polarisation Accelerating

Retail Lease Expiries 2012‐2017 15% IPD Prime Retail IPD Secondary Retail 12%

9%

6%

3%

0% 2012 2013 2014 2015 2016 2017

Source: IPD

Significant Lease Expiries in Secondary Retail

12 A Portfolio Delivering for Occupiers ‐ Polarisation Accelerating

Potential Retailer Expansion Profile “90% said they would use “90%Primark said theyHollister would use a physical stores to check the

High John Lewis

physicalIKEA stores to check the product before buying” l Dunelm aa product beforeAsda/George buying”Zara CBRE: EE’urope’s online consumer CBRE: Europe’sApple onlineSainsbury consumer

Potenti Tesco

al B&Q cc Boots House of Fraser “Multi‐channel consumers Debenhams spend over 80% more per

Physi Currys M&S transaction than store‐only

Gap Next

w Comet shoppers” Deloitte oo

L HMV iTunes Low Online Potential High

Source: Verdict

97% of BL Shopping Centres/Retail Parks Ranked in CACI Top Quartile

13 A Portfolio Delivering for Occupiers – Where Modern Retailers Want to Trade

Retailers Migrating to the Best Space

14 A Portfolio Delivering for Occupiers – Where Modern Retailers Want to Trade

St Stephen’s, Hull

Retailers Migrating to the Best Space

15 A Portfolio Delivering for Occupiers – Retailers Aggressively Managing Portflfolios

Expansion

Improvement

Rationalisation

Retailers Adapting on British Land’s Portfolio

16 A Portfolio Delivering for Occupiers – Retailers Aggressively Managing Portflfolios

Lettings and Lease Renewals By Industry BL Annual ‘000 Since July 2009 Rent £m sq ft DIY & Bulky Goods 12.5 903 Fashion & Footwear 11.3 483 General Retail 4.4 244 Restaurants & Fast Food 3.2 106 Health & Beauty 1.3 44 Electrical 1.3 114 Travel & Leisure 1.2 85 Home Entertainment/Books 0.8 38 Other 1.4 62

Attracting a Wide Range of Retailers Across Sectors

17 A Portfolio Delivering for Occupiers ‐ Four Factors for Retail Success

1. Location • Locally dominant and accessible

• Affordable rents 2. Rent • Where retailers can trade profblfitably

• The right type of space 3. Configuration/Flexibility • Adaptable at right cost

• Where consumers want to shop 4. EiEnvironmen t • Rig ht mix of complimen tary rettilailers and leisure

These Factors Define Prime

18 A Portfolio Delivering for Occupiers ‐ Four Factors for Retail Success

1. Location Locally Dominant and Accessible

2. Rent

3. Configuration/Flexibility

5. Environment

Elgin ‐

Attracted 4 New Retailers –Over 50% Income Growth in Last 3 Years

19 A Portfolio Delivering for Occupiers ‐ Four Factors for Retail Success

1. Location Value for Money

2. Rent

3. Configuration/Flexibility

5. Environment

Mezzanine at Glasgow Fort

2.4m sq ft of Mezzanines Across 9.6m sq ft Retail Park Portfolio

20 A Portfolio Delivering for Occupiers ‐ Four Factors for Retail Success

1. Location Units Easily Adapted

2. Rent

3. Configuration/Flexibility

5. Environment

WH Smith Downsize at Deepdale

Over 80 Capital Asset Management Projects Initiated

21 A Portfolio Delivering for Occupiers ‐ Four Factors for Retail Success

1. Location Complementary Retailers and Leisure

2. Rent

3. Configuration/Flexibility

5. Environment

Kingswood –Costa, ... soon M&S Simply Food

49 Food Lettings and Renewals Agreed

22 A Portfolio Delivering for Occupiers ‐ Four Factors for Retail Success

1. Location • Locally dominant and accessible

• Affordable rents 2. Rent • Where retailers can trade profitably

• The right type of space 3. Configuration/Flexibility • Adaptable at right cost

• Where consumers want to shop 4. Environment • Right mix of complimentary retailers and leisure

Success Depends on Delivering These Factors

23 Key Messages

• A Portfolio suitable for the modern retail environment – Delivering for occupiers – Delivering for shareholders

• The right approach – Quality team, asset management and driving total returns

• Defensively positioned for today …. Well positioned for future growth

Delivering Superior Total Property Returns from Retail

24 A Portfolio Delivering for Shareholders ‐ Lettings Success

New Lettings in the Last 12 Months Q2 Q3 Q4 Q1 Total 2010/11 2010/11 2010/11 2011/12 Number 51 55 46 54 206 ‘000 sq ft 208 142 175 222 747 Annual Rent £3.7m £2.8m £2.5m £3.8m £12.8m vs ERV (0.7)% 7.9% 5.7% 4.3% 3.9%

Three Consecutive Quarters of Lettings Ahead of ERV

25 A Portfolio Delivering for Shareholders ‐ Rental Growth

British Land Retail ERV Movement vs. All Retail IPD ERV growth (March 2010 = 100)

102% British Land IPD 101%

100%

99% Q4 09/10 Q1 10/11 Q2 10/11 Q3 10/11 Q4 10/11 Q1 11/12

Source: IPD

Four Consecutive Quarters of ERV Growth and Outperformance

26 A Portfolio Delivering for Shareholders ‐ Total Returns

British Land Total Returns by Subsector To June 2011

15% 12% 9% 6% 3% 0% 1 year 3 years 5 years ‐3% BL Retail Warehouses BL Shopping Centres BL Superstores ‐6% BL All Retail IPD All Retail

Source: IPD

Our Portfolio Diversity Has Driven Consistent Outperformance

27 A Portfolio Delivering for Shareholders – Subsector Performance

British Land Total Returns by Subsector Relative to IPD All Retail To June 22%12%

9%

6%

3%

0% 2009 2010 2011 ‐3%

‐6% Shopping Centres Superstores Retail Warehouses All Retail

Source: IPD

Our Portfolio Diversity Has Driven Consistent Outperformance

28 A Portfolio Delivering for Shareholders – Regional Returns

British Land Total Returns by Region Relative to IPD All Retail To June 2011 6%

4%

2%

0% London South East South West Midlands Yorkshire North West North East Scotland

‐2% 1 year 3 years 5 years Source: IPD

Our Portfolio Diversity Has Driven Consistent Outperformance

29 A Portflfolio Delivering for Shhldhareholders ‐ Lot Size

British Land Total Returns by Lot Size To June % of BL Retail 2009 2010 2011 Portfolio % % % Over £150m 39% ‐24.2 25.0 12.3

£100‐150m 9% ‐27.3 28.8 13.8

£50‐100m 19% ‐20.9 28.5 10.7

Under £50m 33% ‐19.6 32.8 9.9

IPD All retiltail ‐25.6 26.8 10.0

Source: IPD

Portfolio Diversity Driven Consistent Outperformance

30 Key Messages

• A Portfolio suitable for the modern retail environment – Delivering for occupiers – Delivering for shareholders

• The right approach – Quality team, asset management and driving total returns

• Defensively positioned for today …. Well positioned for future growth

Delivering Superior Total Property Returns from Retail

31 The Right Approach

• The qqyuality of our team

• How we manage the assets

• How we allocate capital

Generating Superior Total Returns

32 Our Team ‐ Strong and Experienced

Head of Retail

Charles Maudsley

Asset Portfolio Operational Superstores Investment Development Management Management

David Tudor Morgan Bryan Lewis Ben Grose Andrew Smith Darren Richards Richard Wise

Integrated Team Generating Superior Total Returns

33 Our Team ‐ Proactive Relationship with Joint Venture Partners

• Bougg,ht, sold, extended 11 stores; renewed and refinanced 3 joint ventures in last 18 months

Bristol, Tesco Hoddesdon, Sainsbury’s

Working in Partnership to Create Opportunity and Value

34 Our Team – Leveraging Expertise to Deliver Value

• Acquired for £10m

• Negotiated with local authority

• Joint Venture with original borrower

• Potential £125m+ development

Working in Partnership to Create Opportunity and Value

35 Our Asset Management Approach

• Understanding the local retail hierarchy

• Staying close to customers

• Creating the right environment

Driving Income Growth Through Active Asset Management

36 Asset Management Approach ‐ Future Proofing Our Assets

British Land Ipad App

Creating the Right Environment for the Future

37 The Right Approach ‐ Driving Total Returns

• Rental Income

• Yield

• Capital Expenditure (tenant incentives and refurbishment)

• Obsolescence

A Balanced Approach ‐ Understanding The Wider Investment Criteria

38 Driving Total Returns – Owning and Investing in The Right Assets

Prime Re‐engineering into prime Best Secondary • Effectively managed • Asset repositioning • Sustainable income • Positioned for growth • Aligning asset to consumer • Acceptable cap‐ex levels • First to see rental growth demand

[meadhlldowhall]

Meadowhall Leamington Spa Llandudno

A Balanced Approach to Investment Driving Total Returns – Investing in Prime at Drake Circus

• £240m acquisition

• 72% of space in large units

• Modern, rack‐rented

• 6.0% initial yield

Drake Circus, Plymouth

Regionally Dominant With 19m Visitors Each Year

40 Driving Total Returns – Re‐engineering to Prime at Mayflower Retail Park

• £51m acquisition

• Good tenant demand

• Under offer on vacant MFI unit

• 6.3% initial yield – 6.9% with letting of vacant unit

• Swapped for ex‐growth Mayflower Retail Park, Basildon asset

New Letting to Start Regeneration

41 Driving Total Returns – Investing in Best Secondary at Barnstaple

• £30m acquisition

• Fully occupied

• Sustainable income

• Affordable rents

• Low capex

• 83%8.3% initial yield

Barnstaple

Locally Dominant with Sustainable Income

42 The Market Today Lettings Under Offer By Retailer Type Health & Beauty • 190,000 sq ft vacant Travel and Leisure 2% • 490,000 sq ft 5% currently under offer 8% ahead of ERV

9% 42% • Second quarter lettings ahead of ERV 13%

21%

General Retail Continue to Believe Medium Term Rental Outlook Positive

43 Ben Grose Head of Retail Asset Management Essentials of Retail Asset Management

• Understanding an asset’s position in its local hierarchy

• A close relationship with retailers – understanding their business and trading

• Creating the right space in the right environment and time frame

Leads to Income and Capital Value Growth

45 Unddderstanding the Retail Hierarchy ‐ In Town

Drake Circus, Plymouth

Opportunities to Attract New Brands

46 Understanding the Retail Hierarchy – District Centre

Beaumont Leys, Leicester

3.5% Income Growth Over the Last 12 Months

47 Unddderstanding the Retail Hierarchy ‐ Out of Town

Kingswood Retail Park, Hull

6% Income Growth Over the Last 12 Months

48 Staying Close to Retailers

“British Land know what’s going on, sometimes better than we do! They clearly want to increase the value of their investment, but recognise there must be something in it for us as well. We try to do the same. We identify highly profitable stores with a good future and approach them with opportunities. It is a real partnership.’’ Food & Drink Retailer

“British Land is a model “British Land takes the time to understand their landlord. You go and talk tenants’ needs and requirements. They take the to them and they listen” time to develop a relationship with us ” Fashion Retailer Home & Garden Retailer

85% of Our Retailers Said We Are Good or Excellent Landlords

49 Staying Close to Retailers ‐ Our Senior Team

Ben Grose

Steve Hadfield Edward Cree Dan Clark Simon Meacock Claire Barber Steven Rickard John Maddison

Relationship Management is Not Separated from Asset Management

50 Staying Close to Retailers ‐ Transactions

Nugent, Orpington New Mersey, Speke

Evidence of Scale

51 Staying Close to Retailers ‐ Next

St Stephen’s, Hull New Mersey, Speke Birstall, Leeds

170,000 sq ft of Lettings, Re‐gears, Refits and Extensions

52 Staying Close to Retailers ‐ M&S

Teesside, Stockton Deepdale, Preston 250,000 sq ft Under Offer or in Discussion Across the Portfolio

53 Staying Close to Retailers ‐ H&M

Glasgow Fort St Nicholas Centre,

Driving Rental Income with Key Occupiers

54 Staying Close to Retailers ‐ Out of Town Mezzanines

New Look (Inverness)

Dunelm (Dartford) Hobbycraft (Orpington)

Working with Retailers to Enhance Affordability

55 Staying Close to Retailers ‐ Trading

• Footfall

• Car park stays

• Path intelligence

• Social media

Meadowhall Student Lock‐in

Sharing Information and Working Together

56 Minimising our Exposure to Tenants at Risk

Allied Carpets MFI Borders Focus 50

40 Units 30 of

er 20

Numb 10

0 ‐3 ‐2 ‐10 Years to Administration

All Five Focus Units Already Re‐let, Income Producing or Under Offer

57 Creating the Right Space ‐ Rothhherham

Parkgate, Rotherham

Improving Retailer Mix and Growing Rental Income

58 Creating the Right Space – Peterbhborough

Before After

Improving ERV and Growing Income

59 Creating the Right Environment ‐ Leamington Spa

Before After

Breathing New Life and Attracting Modern Retailers

60 Creating the Right Environment ‐ Bon Accord & Surrey Quays Shopping Centres

Bon Accord, Aberdeen Surrey Quays, London

Continually Improving Our Assets

61 Creating the Right Environment ‐ Cambdbridge

Before After

Visitor Numbers Up 27%, Driving 5% ERV Growth

62 Creating the Right Environment ‐ Adding Food and Drink

85,000 sq ft of Transactions Generating over £2.5m of Rent

63 Creating Tomorrow’s Retail Environment

The Tollgate Centre, Colchester St James, Northampton

Introducing New Concepts and Offering Greater Convenience

64 Summary

• Driving occupier demand even in a difficult environment

• Expert asset management – Understanding the retail hierarchy – Staying close to retailers – Creating the right space and environment

Sustainable Growth in Income and Capital Value

65 Bryan LiLewis Head of Superstores Key Themes

• Why Foodstores fit so well in the BL Portfolio

• How we drive outperformance

• Defensive today but with growth tomorrow

67 British Land Foodstore Portflfolio

• 22% of BL’s retail portfolio At 30 June 2011 BL Share Lease Value £m • 99 stores totalling 6m sq ft Sainsbury’s JV 632 Open market review Tesco BL Holdings 296 Open market review • Average rent £21psf (in line with ERV) Tesco Aqua 297 Annual RPI (0‐3.5%) BLT Properties 168 Open market review • 50%5.0% EPRA Net Initial Yield Shopping Centres Ltd 100 Open market review TBLPP 58 Open market review • 92% of income leased to Wholly owned 143 Open market review Sainsbury’s or Tesco Total 1,693

Significant, Sensibly Priced and Well Secured

68 Rental Value Growth ‐ BL Foodstores vs IPD

ERV Growth To June 2011

4%

3%

2%

1%

0% 1 year 3 years 5 years 10 years 15 years ‐1%

‐2%

‐3%

‐4% BL Foodstores IPD Shops IPD Retail Warehouses IPD Shopping Centres

Source: IPD

Growth in the Good Times, Defensive in Difficult Times

69 Strengths of Our Foodstore Portflfolio

• Anchored in non‐discretionary spending

• Strong covenants

• Retailers gaining market share

• Average lease length remaining of 17 years

Strong Covenants, Expanding Retailers and Long Leases

70 Limited Capital Expenditure

Tesco Bristol ‐ Before Tesco Bristol ‐ After

Retailers Frequently Refreshing Their Stores

71 Driving Income

Highest Open Market Lettings British Land Rent Reviews ‘000 sq ft £psf ‘000 sq ft £psf Over 100,000 sq ft: Over 100,000 sq ft: Colchester, Sainsbury’s 106 26.79 Peterborough, Tesco 136 28.50 Wakefield, Sainsbury’s 117 21.50 Milton Keynes, Tesco 141 26.00 35‐100,000 sq ft: 35‐100,000 sq ft: Southampton, Morrisons 58 22.40 Orpington, Sainsbury’s 69 28.25 Colchester, Waitrose 36 23.00 Maidstone, Tesco 50 25.00 London London Harrow, Morrisons 63 22.50 Chiswick, Sainsbury’s 76 33.75 Wimbledon, Waitrose 32 28.00 Islington, Sainsbury’s 67 31.50

Quality Assets Outperforming

72 Stock Selection ‐ Sales

Birkenhead Portsmouth

Newport Walthamstow

£111m (Gross) of Foodstores Disposals Since Apr‐10

73 Stock Selection ‐ Purchases

Durham Hoddesdon

Modern Conforming Stores Which Are Locally Dominant

74 Stock Selection ‐ Macclfldlesfield

Sold At 4.4% Yield Giving a Total Return of 17%

75 Delivering Total Returns

Total Property Returns To June 2011 BL Foodstores IPD Shops IPD Retail Warehouses IPD Shopping Centres 12%

9%

6%

3%

0% 1 year 3 years 5 years 10 years 15 years ‐3%

Source: IPD

Foodstores Consistently Outperformed IPD

76 CiContinue d Increase in Grocery Share of RilRetail

Grocery Retail Market Size £bn 200 6.0% Market Value (LHS) Annual Growth (RHS) 5.0% 150 4.0%

100 3.0%

2.0% 50 1.0%

0 0.0% 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

Source: IGD Research

Grocery Share Expected to Grow to 54% of Retail

77 Retailer New Store Activity

Foodstore Requirements • 1.5m sq ft of new stores will open in 2011 • 1.3m sq ft of new stores will open in 2012 • 188 new stores opened in 2011 • Expanded its estate by 6.3% with a total of 3,153 stores • Expect to open c.2m sq ft

• 250 stores in next fives years of 5,000 – 25,000 sq ft

• 1.5m sq ft for each of the next 5 years

• Aims to open 300 convenience stores in the next 10 years • 300,000 sq ft in 2011 • 350,000 sq ft in 2012

Strong Demand From All Five Major Retailers

78 Growing Internet Sales

“Online grocery purchases only account for 3.2 per cent of total grocery sales in the UK, although overall internet sales account for nearly 10 per cent of all retail sales.” Marketing Week

“Multi‐channel shopping is a key feature of online grocery –the vast majority still shop at the supermarket.” Evolution Insights

Online Shopping Accounts for Less Than 5% of the Grocery Market

79 Foodstore Supply ‐ Development Pipeline

Foodstore Development Pipeline m sq ft • 40% of the pipeline has 50 Proposed With Consent Under Construction no consent 40 • 50% is developer led 30 with no occupier

20 • OlOnly 5% of piliipeline is under construction 10

0 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011

Source: CBRE

Only 5% is Actually Under Construction

80 Growing Thhhrough Extensions

• BL average site density only 27%

• Over 100,000 sq ft funded or currently under construction

• Further 120,000 sq ft under discussion

Preston, Sainsbury’s – 14% increase in store size

81 Summary

• A significant part of British Land’s portfolio

• Delivered excellent historic returns relative to the market

• Sensibly priced on a risk adjusted basis – 5.0% Yield

• Strong underlying business model and attractive long terms fundamentals continue to apply

• Good prospects for future performance

Portfolio Provides Combination of Resilience and Growth

82 JhJohn Maddi son Senior Asset Manager ‐ Out of Town Retail The Largest Owner/Manager of RtilRetail PkParks

• 80 assets; 9.6m sq ft • 82% open A1 consent 22% 25% • Low void rate – 99.1% let (from 97.7% in 13% June 2009) • Average lease length of 10.3 years 9% 31%

British Land Manages £4.4bn of Retail Warehouses

84 Out of Town ‐ Key Asset Criteria

1. Location • Locally dominant and accessible

• Affordable rents 2. RtRent • Where retailers can trade profitably

• The right type of space 3. Configuration/Flexibility • Adaptable at right cost

• 4. Environment Where consumers want to shop • Right mix of complimentary retailers/leisure

The Makings of a Good Asset

85 Driving Value Thhhrough Controlling Costs

• BL average Shoppin g/Su per Park service charge only £1.50psf • Average benchmark for UK Shopping Centres is £6.34psf

• Landlord of the Year 2009/10 • Service Charge Provider of the Year 2009/10 • Platinum Audit Award 2011 (only one ever issued to a landlord)

Source: Jones Lang LaSalle

Industry Wide Acclaim

86 Examples of Our Retail Parks

Super Park Traditional Retail Park Purpose Built Shopping Park

Teesside Stafford Glasgow Fort

Different Assets, Same Strong Fundamentals

87 Teesside ‐ Dominant and Accessible

• 750,000 sq ft retail/ leisure park • Annual footfall of 8m • Easily accessible

Number One Super Park in the UK

88 Teesside ‐ Scale and Strength

• Average rent £29psf • Achieving headline rents of £47.50psf

Trades Really Well and Headline Rents Are Growing

89 Teesside – Affor da bi lity

• Consistently trades in top 5 stores in UK out of 450 stores

• In the top 20 stores in the UK out of 400 stores

• In the top 10 stores in the UK out of 80 stores

• Best store in the region out of 65 stores

• In the top 10 retail park stores in the UK out of 49 stores

Strong Trading Platform is Key to Affordability

90 Teesside ‐ Configuration and Fllblexibility

Republic and TUI Units

Subdivision Increases Fascias and Enhances Retailer Mix

91 Teesside ‐ Configuration and Fllblexibility

Next Mezzanine

Mezzanine Drives Sales Densities and Rental Growth

92 Teesside ‐ Continually Improving the Environment

COSTA unit and Public Information Centre

Improving Offer and Increasing Dwell Time

93 Staffor d ‐ Key Facts

• 172,500 sq ft • Purchased 2008 • 11 new lettings since ownership

Rental Income Increased From £1.4m to £3.1m Since Purchase

94 Staffor d ‐ Whlholesa le Reffbhurbishment

Before After

Modernising and Continually Improving

95 Staffor d ‐ Configuration and Fllblexibility

Before After

Regenerating Space and Increasing Retail Offer

96 Staffor d ‐ Affor da bi lity

Trading Well Above Expectations

97 Staffor d ‐ Continually Improving

Before After

Enhancing Space for the Right Occupiers

98 Staffor d‐Improving Customer Experience

COSTA unit and Carphone Warehouse

Essential Facilities Key to Growth

99 Glasgow Fort ‐ Scotld’land’s Premier Shopping Park

• Dominates East Glasgow • Extended opening hours – 50% of trade between 5pm and 10pm • Significant extension growth potential

Locally Dominant – 12.5m Visitors a Year

100 Glasgow Fort ‐ Flexibility, Configuration and Affor da bi lity in Practice

Before After

Reconfiguring Space to Create Capital Growth & Increase Income

101 Glasgow Fort ‐ The Finishdhed Article

High Sales Densities for Fashion Retailers

102 Glasgow Fort ‐ Further Improving the Environment

Adding New Pre‐let 8‐screen Cinema and Five Restaurants

103 Glasgow Fort ‐ Continually Adding Value

Converting 15,000 sq ft Leisure Unit to Retail

104 Summary

• Right assets

• Doing the right things

• Meeting customers’ needs

• Achieving targeted total returns

Well Placed to Meet Customer Needs and Deliver Returns

105 Cla ire BbBarber Senior Asset Manager – Shopping Centres

Well Placed to Meet Customer Needs and Deliver Returns Our UK Shopping Centres Portflfolio

Bon Accord & St Nicholas, Aberdeen

Lisnagelvin, Londonderry

St Stephen’s, Hull Meadowhall, Sheffield

Serpentine Green, Peterborough Beaumont Leys, Leicester Eastgate, Basildon Green Lanes, Barnstaple Surrey Quays, London

Drake Circus, Plymouth

107 Our UK Shopping Centres Portfflolio

• £2.3bn uudender maaageetnagement (BL Share £1.5bn)

• High Occupancy of 97.6%

• Average lease 9.7 years

• 14.6% of income expiring in next 3 years (IPD 25.8%)

Quality Assets With Strong Income Profiles

108 Drake Circus, Pllhymouth

• 560,000 sq ft

• Opened in 2006

• Anchor tenants include M&S, Primark, Next, Boots and H&M

• 1,270 car parking spaces

Dominates Catchment – 19m Visitors Each Year

109 Drake Circus ‐ Plh’lymouth’s Only Modern Retail Environment

72% of Space in Units of Over 7,500 sq ft

110 Drake Circus ‐ Understanding our Customer Base

• 30,000 students

• Over‐representation of key customer group (15‐34 years)

• Dominated by ACORN group described as ‘Comfortably off’

Opportunity to Attract More Affluent Shoppers

111 Drake Circus ‐ Enhancing the Future Offer

To Drive Future Rental Growth

112 Meadhlldowhall

• 14m1.4m sq ft

• Annual footfall 24m

• Anchored by House of Fraser, M&S, and Debenhams

• 11 screen Vue Cinema

• 12,000 free parking spaces

One of Only Six ‘Super Regional’ Shopping Centres in the UK

113 Meadhlldowhall ‐ Improving the Customer Profflile

• Targeted marketing ‐ focus on 3 key high spending groups

• Proportion of visitors from these 3 key groups increased by 5%

• 42% of first time visitors from these key groups

Symbols of Success Happy Families Suburban Comforts

Generated Income Growth of 3.2% in Last 12 Months

114 Leveraging Customer Relhlationships ‐ House of Fraser

Store Under Investment by Tenant Since Opening 21 Years Ago

115 Leveraging Customer Relhlationships ‐ House of Fraser

Strong Double Digit Sales Growth Post Refurbishment

116 A More Premium Retail Offer

• First Fashion Rocks in the UK

Increasing Rental Income With Lettings At or Above ERV

117 Working with Retailers to Grow their Businesses

• At Meadowhall …….. • and Bon Accord, Aberdeen……..

By Delivering the Right Space in the Right Environment

118 St Steph’hen’s, Hull

• 563,000 sq ft

• Annual footfall 10m

• Anchdhored by Tesco, Next, H&M and TK Maxx

• 1,500 car parking spaces

Dominant City Centre Scheme – Fully Let

119 Modern Retail Space in a City Centre Environment

Demand Outstrips Supply ‐ Recent Letting Increased Zone A by 5%

120 Expanding Our Restaurant Offers

Extending Dwell Time and Increasing Spend

121 Improving the Food Offer at Meaddhllowhall

• Fast food dominates and over trades

• Underperforms relative to its out of town peers due to the lack of premium offers

Oasis Food Court ‐ Before

Major £7m Refurbishment and Reconfiguration

122 Improved Offer, Appealing to a More Affluent Customer

Oasis Food Court ‐ After

Creative Use of Space Generating Yield on Cost of Over 14%

123 Future Growth Potential ‐ Meadhlldowhall

Imaginative Tenant Engineering Attracting New International Brands

124 Future Growth Potential ‐ Peterbhborough and Surrey Quays

Satisfying demand at Serpentine Green Investing to reposition Surrey Quays

In Discussions to Meet a Number of Active Retailer Requirements

125 Future Growth Potential ‐ Barnstaple

Improving the Retail Mix By Reconfiguring and Refurbishing Units

126 Summary

• Understanding the retail hierarchy

• Delivering the right space for retailers

• Understanding our customers

Strategic Asset Management Leads to Outperformance

127 Ric har d Wise Head of Retail Development Four Central Themes

• The supply shortage of prime space

• Planning policy supports regeneration

• Our competitive advantages

• We have the right strategy

Opportunity to Add Incremental Value

129 The Supply Shortage

Retail Development Completions m sq ft 15.0 Retail Warehouses Town Centre 12.0

9.0

606.0

3.0

000.0 2001 2003 2005 2007 2009 2011 2013 2015

Source: Verdict

Current Development at Historic Low

130 Public Sector Support

• Central and local planning policy uncertain

• Regeneration and job creation is strongly supported

• Now is the right time to bring forward tomorrow’s developments

Planning Window is Opening

131 Our Competitive Advantages

• Scale and volume

• Experienced team

• No significant UK development exposure prior to the recession

• Development partner of choice

• Financial strength

Experienced Team with Financial Strength

132 The Right Development Strategy

• Focus on mid‐sized projects (£50‐250m)

• Buy control today to develop tomorrow

• Develop more food stores

Whiteley Shopping Centre

Lower Costs Lead to Affordable Rents

133 Proposed Major UK Projects

‘000 BL ERV Total Cost sq ft Share (BL Share) (BL Share) £m £m Power Court, Luton c.200 100% TBC TBC

Whiteley Shopping Centre 302 50% 2.5 34

Surrey Quays 100 50% 101.0 13 Development Funding 310 100% 5.9 88 (under offer)

• Plus 400,000 sq ft of unimplemented planning consents

£275m of Proposed/Identified Schemes

134 Whlhiteley Shopping Centre

• 1 mile from J9 of the M27

• 302,000 sq ft in 50 units

• Likely start 2012

Over 40% (by Value) Now Under Offer

135 Power Court, Luton

c.200,000 sq ft Scheme with Food Store Anchor

136 Surrey Quays Shopping Centre

Before After

Major 100,000 sq ft Extension Adding 17 Units

137 Summary

• Very little A grade stock being developed

• Planning policy supportive of urban regeneration

• Limited UK development exposure prior to the recession

• Focus on mid‐sized urban projects and food stores

• We are lklooking to buy control today and develop tomorrow

British Land is Well Placed to Exploit Market Opportunity

138 Char lie MMdlaudsley Head of Retail Key Messages

• A Portfolio suitable for the modern retail environment – Delivering for occupiers – Delivering for shareholders

• The right approach – Quality team, asset management and driving total returns

• Defensively positioned for today …. Well positioned for future growth

Delivering Superior Total Property Returns from Retail

140 Our Portflfolio ‐ Defensive Today

At 30 June 2011 Occupancy rate 98.7% Fixed uplifts 24.4% Lease length 12.6 years Income expiring (June 2011‐14) 6.9%

Strong and Secure Income Profile

141 Our Portflfolio ‐ Defensive Today

• 75% of income from top 50 retailers • Rent collection 98% within two weeks of quarter day • 0.5% occupiers in administration and only 0.5% temporary lettings % of Retail Rent % of Retail Rent Tesco 11.8 House of Fraser 1.7 Sainsbury 10.1 New Look 1.5 Debenhams 696.9 TK Maxx 141.4 Homebase 3.7 Argos 1.3 Kingfisher (B&Q) 3.5 Kesa (Comet) 1.2 Next plc (inc. Next at Home) 3.2 Mothercare 1.2 Alliance Boots 222.2 BHS 121.2 Asda (inc. Asda Living) 1.8 Burtons/Dorothy Perkis//Evans 1.0 Currys 1.8 SportsDirect 1.0 Marks & Spencer 1.8 Pets at Home 0.9

Strong and Secure Income Profile

142 Our Portflfolio ‐ Defensive Today

• Portfolio is rack rented or reversionary today

At 30 June 2011 British Land IPD Average contracted rent £21psf £17psf Average ERV £22psf £19psf EPRA Net Initial Yield 5.4% 5.8% Net Equivalent Yield 5.7% 6.3%

Strong and Sustainable Platform for Growth

143 Positioned For Future Growth

• Growth from existing portfolio

• Adding space through extensions and development

• Recycling

Delivering Superior Total Returns

144 Growth From Existing Portfolio ‐ Shortage of the Right Space

UK Retail Development Completions • Continued demand – m sq ft 490,000 sq ft under offer 12.0 Retail Warehouses • Town Centre Shortage of the right space – little new sttkock in 9.0 the pipeline

6.0

3.0

0.0 2001 2003 2005 2007 2009 2011 2013 2015

Source: Verdict

Positive Rental Outlook for the Right Space

145 Growth From Existing Portflfolio ‐ Rents

At 30 June 2011 Contracted Rent ERV £psf £psf Superstores 21 21 Meadowhall 58 60 Other Shopping Centres 19 19 Retail Warehouses 23 23 Retail Warehouses (inc. mezzanine) 19 21 Department Stores 12 9 TlTotal 21 22

Affordable Rents With Good Potential in the Medium‐term

146 Growth From Existing Portflfolio ‐ Affor da ble Rents

Illustrative Comparison of In Town and Out of Town Total Occupational Costs

In Town Out of Town Out of Town Out of Town Typical 5,000 sq ft Unit (Zone A) (No Cover) (50% Cover) (100% Cover)

£150psf £45psf £70psf £90psf

£200psf £60psf £90psf £120psf

£250psf £75psf £110psf £150psf

147 Growth From Existing Portfolio ‐ Potential Extensions and Developments

‘000 sq ft BL Share

Whiteley Village, Fareham 302 50%

Glasgow Fort Shopping Park 175 39%

Glasgow Fort Shopping Park (leisure) 48 39%

Fort Kinnaird, 223 19%

Surrey Quays Shopping Centre 103 50%

Deepdale Retail Park, Preston 76 19%

Broughton Park, Chester 58 39%

Power Court Luton c.200 100%

Superstore extensions 103 50%

Kingston Centre, Milton Keynes 21 50%

Over 1m sq ft of Potential New Space Across Our Portfolio

148 Capital Recycling ‐ Availbllable Investments

• Very little prime assets oppyenly available

£m Prime Secondary Total

Retail Warehouses (above £15m) ‐ 238 238

Shopping centres (above £20m) 325 909 1,234

Total 325 1,147 1,472

Source: CBRE (September)

Greater Opportunities in More Challenging Assets

149 Summary

• We have the right assets for the modern retail environment

• The right approach to deliver superior returns

• Defensively position for today …. Well positioned for future growth

Delivering Superior Total Property Returns from Retail

150 Glasgow Fort Shopping Park

Delivering Superior Total Property Returns from Retail

151