Brixton, the West London industrial property developer, defied the general slump in commercial property as the value of its holdings rose 0.7 per cent to £2.45 billion.

The small increase in Brixton's estate is set against a fall on average of 8.4 per cent for the value of Britain's industrial property holdings while the £450 billion UK commercial property market lost on average 7.7 per cent of its value last year, according to figures for the Investment Property Databank.

“These results continue to differentiate Brixton's business from the general commercial property market,” Tim Wheeler, the firm’s chief executive, said. “We remain confident with our positioning at this stage in the economic cycle and the prospects for the business going forward”

In early morning trading the company's shares gained 2 per cent, or 5p, at 325p.

During 2006 the company sold off around a quarter of its property portfolio, to benefit from what it believed to be peak prices in the secondary industrial property market around the North West of England, and used the £560 million it gained to buy prime property in its core locations near Heathrow.

Strong gains in the value of Brixton's portfolio during the first half of 2007 were in part off-set by a 6.2 per cent valuation decline in the second half of the year, but this was still better than the market.

Rent reviews and new lettings meant Brixton enhanced its rental income by 5.1 per cent for the year, beating average rental growth for the industrial sector of 1.2 per cent and 1.4 per cent annual rent growth posted last week by rival Segro, owner of the Slough trading estate.

Mr Wheeler warned however that the global economic slowdown, combined with availability and pricing restrictions on finance, could hit occupational demand for property.

Mr Wheeler said: “We are not immune from wider influences and the ongoing uncertainties in the global credit markets. The effect of this on the economies of the UK, the US and the Eurozone in particular is likely to have a dampening effect on the activities of the UK corporate sector."

Brixton's net asset value per share rose 2.1 per cent to 54p per share. Pre-tax profit from rents and investment, the core measure of a property company's trading, fell 2.1 per cent to £46.6 million as the company made more properties vacant for redevelopment.

The value of its property holdings rose £17 million but that was down from £220 million of surpluses notched up in 2006 when the property markets were hot. Smaller property value gains means pre-tax profit for the year ended December 31 fell 72 per cent £58.2 million. This decline did not affect cash flow. The total dividend rises 11.5 per cent to 22.p per share.

The company calculated that the scrapping of empty business premise rates relief from next year will hit 2008 earnings by at least £5 million.

The Government announced in the 2007 budget that it would withdraw empty buildings rates relief. Brixton began however from last June's half-year figures to factor the extra cost into its property valuations.

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