Outlook

We had anticipated a weakening in the pricing of property investments and so accelerated our programme of property sales in the first half of the calendar year. We expect the current weak trend in property investment pricing to continue, but we believe that the greatest impact will be experienced on secondary properties where, in recent years, yield pricing has not fully reflected the risks associated with lower quality properties. We therefore expect our shareholders to benefit, in relative terms, as a result of the high quality of our portfolio.

Our London development programme completions are concentrated in the current financial year ending 31 March 2008 reflecting our decision to start a substantial development programme early in the cycle. We will be completing 148,600m² of developments in London in the current financial year, and these projects are now 90% let.Over the next two financial years, when employment growth in the financial services sector may be weaker, we will be completing just 25,400m² of office developments in London.