Review of business structure

These three divisions have performed well under the current diversified structure, but the business models are distinctive and have different financial characteristics:

• RETAIL: The Retail division seeks to create and enhance long-term dominant assets through development and active management. It focuses on creating attractive, retail environments to generate sustainable earnings growth.
• LONDON: The London Portfolio has a greater emphasis on development activity and capital recycling to manage effectively the cyclical nature of its office market. The portfolio also offers a broader investment in London as one of the world’s major financial centres. It has material retail assets and also major retail and residential elements in its development programme. In addition, it offers shareholders significant value creation potential from its Kent Thameside development, which will be material relative to the size of this business.
• PROPERTY OUTSOURCING: The historic value creation from Trillium, with a return on capital since acquisition of 28%, has been outstanding. It now has market leading positions in both property outsourcing and PFI. However, with the growing role of PFI and PPP contracts, Trillium’s business and operations have increasingly different characteristics from property investment, and as such the key valuation metrics are also different.