StockMarketWire.com - British Land and Blackstone have satisfied the outstanding conditions on an agreement with UBS to pre-let 5 Broadgate near London's Liverpool Street station.

British Land said development of the new 700,000 sq ft building will proceed now that the agreement is unconditional, Demolition of the existing 4 & 6 Broadgate buildings is well under way and will be completed in April, with delivery of the new bespoke building on schedule for fourth quarter of 2014.

The British Land and Blackstone joint venture has already placed or tendered around 60% of the project's construction costs within budget and programme.

UBS will lease the entire building for an average of 18.2 years to first break at an initial rent of £54.50 per sq ft subject to annual increases in line with RPI (within a range of 0-4% per annum).

UBS will be given a rent free period of 18 months. As part of the agreement, UBS has also deferred exercising lease break options on 755,000 sq ft of existing space which it currently occupies at Broadgate (comprising 1-2 Finsbury Avenue, 8-10 Broadgate and 100 Liverpool Street) until 18-36 months following practical completion, to allow the new building to be fitted out.

The earliest date that UBS can break the leases is towards the end of second quarter of 2016.

Deferring the lease breaks will ensure that the JV receives a further £74m of rent, approximately £32m of this was agreed by UBS on signing of the conditional agreement in 2010, as part of a package of negotiated lease amendments.

At 3:40pm: (LON:BLND) British Land share price was -7.25p at 490.95p


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