Mapeley, the landlord to Revenue & Customs, reported a £53 million loss in the first half of 2008 after a fall in value of its properties, including many government buildings.

The UK property outsourcing company confirmed a pretax loss of £53.8 million in the six months to June 30, against a £30.2 million pretax profit the previous year. The loss was attributed to writedowns in its property portfolio in line with declining market conditions. Average commercial property values in the UK have fallen by about a fifth since June 2007.

The value of the Revenue & Customs portfolio, accounting for almost 75 per cent of Mapeley’s $4 billion (£2.1 billion) property empire, fell by £36.6 million to £526.8 million year on year, because of £13.5 million of disposals and a £23.1 million reduction in value. A total of 92 per cent of Mapeley’s annual rental income is from government or investment-grade tenants and its average lease length is ten years. Mapeley bought Revenue & Customs’ facilities in 279 centres around Britain in 2001.

The value of Mapeley’s total assets slipped £80 million to £2.24 billion at December 31. It halved its dividend to 47p a share from 94p a share last year.

The Guernsey-based company also said yesterday that it had more than doubled its funds from operations – a measure of performance – in the first half. Funds from operations climbed 129 per cent to £63.1 million, as more UK companies looked for expert management of their property. Shares in the UK property company fell 22p during the day, but rallied to close up 52p at £10.70, reducing the stock’s losses this year to 29 per cent and lifting the company’s value to £315 million.

The company owns a commercial property portfolio covering more than 2.3 million sq m (24.8 million sq ft) across the UK. Lehman Brothers analysts would not rule out a bid for Mapeley “over the next few months”.

Times Recommends

• Lies and cover-up at MG Rover exposed by report
• High oil prices push manufacturing costs up
• Primark founder steps down as chief executive