More evidence that the UK property market is close to a turnaround arrived today, when Land Securities paid back £1.5bn of debt.
Britain's largest real-estate investment trust said the move gave it "significant firepower ... to take advantage of market opportunities". Land Securities chief executive, Francis Salway, added that it would put the company in a strong position, just a day after it sold its stake in the Bullring for £210m.
"Our recent activity in executing sales, raising new debt facilities against assets and managing costs has reinforced our confidence in our forecasts and means we have taken this step earlier than our internal plans had assumed."Today's decision strengthens our hand in positioning the business in a secure and strong state ready to take advantage of future opportunities."
At the end of June, Land Securities had £4.48bn of debt, giving it a loan-to-value ratio of 76.0%. Today's payback cuts that ratio to around 59%.
Shares in Land Securities are down just over 1%, at 679p.
The FTSE 100 is currently up just over 40 points at 5174.71, maintaining most of the gains it racked up at the start of the trading session. Eurasian is up 5.2% at 919.5p, Fresnillo is 4.3% higher at 786p, with Vedanta and Rio Tinto among the risers.
Holiday companies are also in demand. Tui Travel is the third highest riser, up 3.6% at 278.8p, while cruise operator Carnival is 3.1% higher at £21.24 after being added to Bank of America Merrill Lynch's list of recommended stocks.
Utility firms Severn Trent and United Utilities continue to lead the fallers, as traders speculate that they will launch rights issues. As reported today, the next price controls on water bills could leave the industry with lower-than-expected profits.
Philip Gillet, sales trader at IG Index, said the buyers had returned to the market after yesterday's sell-off.
"As has so often been the case over recent months, it is a mining-led rally so far today, with commodity strength in Asian trading lifting the likes of Eurasian Natural Resources and Fresnillo to the top of the leader board.
"Today's recovery shows that sentiment still looks to be positive amongst investors, with plenty of traders apparently willing to step in and buy the dips."
Punch Taverns was the biggest riser on the FTSE 250 this lunchtime, gaining 6%, or 7.3p, to 127.3p. It was boosted by the news it has repurchased some convertible bonds, at 33.9% of their face value.
