Property Division: BL Universal 

	1999 £m	1998 £m
Trading Profit	31.9	41.3
Proportion of Group Trading Profit	6%	9%
Net Assets	249.0	262.4

In February 1997 the Group placed its investment portfolio into a joint venture company, BL Universal PLC – owned equally by GUS and The British Land Company PLC. BL Universal’s strategy is to focus principally on freehold retail properties in prime locations where growth in capital values and rental income can be achieved.

Over the two years to 31 March 1999, there has been a significant change in the structure of the portfolio to achieve this strategic aim. Of the original 982 properties, 580 have now been sold for a total of £286m; 207 of these were sold in the last 12 months for £103m. The proceeds have mainly been used to acquire new properties. In total, £248m has been spent acquiring 14 properties, of which £166m was invested in the last twelve months.

Trading profit fell this year largely because profit arising from the sale of properties was £2.3m compared to £11m last year when some non-recurring significant gains were available. Following the 14% uplift in the value of our properties that was reflected in the March 1998 balance sheet (but not in the profit and loss account for that year), profit on sales in the last twelve months was lower than in the previous year.

The valuation of the portfolio at 31 March 1999 was £1,047m which, adjusting for acquisitions and purchases, reflects an increase of 3.2% on last year's figures. This has resulted in a growth of £18m this year in the value of the Group's investment in the equity of BL Universal.

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