The head of British Land, Britain’s second-most valuable property company, is ready to delve into a £2 billion war chest to pounce on an expected flurry of distressed property sellers.

Yesterday’s admission by Stephen Hester, the chief executive, that he is set for a shopping spree was accompanied by a £330 million writedown on the value of British Land’s own shops portfolio.

The company’s retail property assets slipped in value by 3.4 per cent to £9.43 billion in its second quarter to September 30. Shopping centres were worst hit, declining in value by 4.5 per cent in the first half of its financial year. The writedowns in its latest interim figures represent the first time that British Land has had to cut retail property assets since a decade ago, when the wider commercial property market was still suffering from the mid1990s slump.

Mr Hester said that commercial property prices generally were falling. Further sharp drops were expected as the sector struggled with wider macro-economic uncertainties. “I cannot say definitively where or when it will end,” he added.

Despite the slip in value of Land’s retail assets, Mr Hester said that the group was in good shape to weather a “price correction” that would force a number of debt-ridden companies into sales over the coming months. “We have prepared ourselves financially and managerially to be able to take advantage of opportunities if there are cheap things that shake out from the property market correction,” he said.

Asked how much he could spend on acquisitions, Mr Hester said: “We have said we have £2 billion of committed undrawn facilities.”

Mr Hester also ruled out any change for the foreseeable future to the structure of British Land, a real estate investment trust (Reit) with £15.9 billion of retail and office assets.

Land Securities, the UK’s most valuable Reit, on Wednesday announced plans to demerge its retail, London property and Trillium property management operations.

Commercial property prices have been hit by the soaring cost of debt and the credit crunch. Fears are mounting that highly leveraged owners of commercial property may have to sell.

British Land’s portfolio fell 1.9 per cent in its second quarter, a drop of £308 million to £15.9 billion. Strong oc-cupational demand for its mainly City and West End offices lifted their value 0.6 per cent to just over £6 billion.

British Land’s net asset value (NAV) per share stayed at £16.82. Underlying interim pretax profits rose 10 per cent to £143 million. Arbuthnot analysts cut their forecast of Land’s NAV for March 2008 from £17.36 to £14.38.