Land Securities - Q3 Interim Management Statement

For immediate release

22 January 2008


Land Securities Group PLC ("Land Securities" / "Group")

         LAND SECURITIES - THIRD QUARTER INTERIM MANAGEMENT STATEMENT          
                "Good progress across all business activities"                 

Land Securities' high levels of activity during the quarter demonstrate
continued strong performance across all of its three divisions as it benefits
from its long term approach to the management of each business. Looking ahead,
Land Securities is well placed to run the Group through the current challenging
environment and is ready to exploit opportunities that arise in its business
sectors.

Highlights of the quarter are:

  * £507.8m of investment property disposals at an average yield of 4.9%. The
    sales were at 5.6% above the September 2007 valuation, and 4.7% above the
    March 2007 valuation (pre-disposal costs), to show a net profit on sale of
    £17.7m.
   
  * The successful first closing of Trillium PPP Investment Partners with firm
    commitments for 67% of the equity and the raising of £568m of debt finance
    within the joint venture.
   
Other activity includes:

  * 22,100 sq m of development space completed during the quarter, 82.5% let.
    On track to deliver 241,700 sq m of development space during the 2007/08
    financial year, already 93% let.
   
  * Investment portfolio - disposals of £507.8m, acquisitions of £178.3m and
    development and other capital expenditure of £103.9m, giving net
    disinvestment of £225.6m in Q3.
   
  * Like for like property voids decreased to 4.1% at 31 December from 4.2% at
    30 September due to retail warehouse lettings.
   
  * Trillium nominated as preferred bidder for the Kent Building Schools for
    the Future contract.
   
  * Third quarterly dividend of 16.0 pence (80% in the form of a Property
    Income Distribution), as previously announced - payable on 25 April 2008.
   
Commenting on the third quarter, Francis Salway, Group Chief Executive of Land
Securities said:

"We have again achieved high levels of activity across the Group,
notwithstanding challenging conditions in the property investment and credit
markets. Our successful performance is based on the effective management of our
portfolio delivered in line with our long term view of the market. This means
that, whilst our investment portfolio will not be immune from the general
negative trends, we are well placed to run the business in the current
environment and to exploit opportunities that may arise.

"We anticipated a weakening in the pricing of property investments, and in the
2007 calendar year sold over £2.0bn worth of properties. In the quarter, we
maintained our programme of property sales through the sale of good properties
at good prices in line with our plans for the year.

"The strength of our Trillium business is evidenced by the successful debt and
equity raising for the Trillium PPP fund along with our recent appointment as
Preferred Bidder for the Kent Building Schools for the Future programme. We
believe that Trillium is well placed to win further new business.

"We announced in November our long term vision for sustainable value creation
for shareholders through demerger into three separate companies. We have
commenced the extensive and detailed preparatory work required but it remains
at an early stage."

LONDON PORTFOLIO

Our substantial development programme in London will deliver 148,600 sq m of
office space during the current financial year. This space is already 94% let.
Over the following two years we will deliver just 25,400 sq m of new
developments in London. We believe this is an appropriate level of activity
given our outlook for the City of London market over the next two years. During
Q3 we made further progress on the leasing of our development projects. Over
the period, sales totalled £317.6m with an average yield of 5.1% and a surplus
of 4.1% versus September 2007 valuations and 4.0% versus March 2007 valuations.

Investment activity

  * Sale of 50% of our holdings at the corner of Oxford Street and Tottenham
    Court Road for £102.9m into a joint venture with Frogmore Real Estate
    Partners L.P. The joint venture will be responsible for the asset
    management, including a review of the redevelopment potential, of the
    holdings.
   
  * Exchange of contracts for the sale of a 50% interest in Thomas More Square
    estate, London E1 to Ontario Teachers' Pension Plan Board (Cadillac
    Fairview) for £131.5m.
   
  * Exchange of contracts for the sale of our Lime Street estate, London EC3 to
    Grainmarket for £70.1m.
   
Development activity

  * Three further lettings totalling 2,500 sq m at the New Street Square
    development on New Fetter Lane, EC4. Rents range from £60 psf to £76 psf.
   
  * Terms have been agreed for two lettings at 10 Eastbourne Terrace totalling
    approximately 70% of the total space. Completion of the refurbishment is
    expected in June 2008.
   
  * Continuation of work with partners and stakeholders to secure an acceptable
    solution for our major Victoria Transport Interchange project. We are still
    at the preliminary stages of this project and it does not yet form part of
    our formal development programme.
   
  * Capital expenditure of £42.4m on London developments during the quarter.
   
Urban Community Development

  * Planning consent received for our 270 hectare site at Eastern Quarry which
    will include 6,250 homes and 232,000 sq m of commercial and community
    floorspace. With this planning consent and the opening of the CTRL station
    at Ebbsfleet, this major and ambitious project is now moving to the
    delivery phase.
   
RETAIL PORTFOLIO

The quality of the assets in our Retail Portfolio, our extensive development
programme and our management skills ensure that we are well positioned in this
sector. During the quarter, the quality of our developments was recognised by
the BCSC, which awarded our Princesshay development in Exeter its Supreme Gold
Award. Over the period sales totalled £190.2m, with an average yield of 4.5%
and a surplus of 8.3% versus September 2007 valuations and 5.8% versus March
2007 valuations. Void levels were below market average at 4.0%.

Investment activity

  * Acquisitions totalled £159.3m, and included the purchase of a 75% stake in
    the Trinity Centre development site in Leeds.
   
  * Creation of the Harvest Partnership joint venture between J Sainsbury and
    Land Securities, which combines our expertise in development with
    Sainsbury's desire to create additional floorspace. We initially
    contributed a Sainsbury's supermarket in Hull that we owned and Sainsbury's
    contributed two stores in Thanet and Wandsworth. At the same time, we
    exchanged contracts to sell to Sainsbury's two supermarkets in Winchester
    and Wolverhampton.
   
    We have already taken steps to grow the JV through acquisitions from third
    parties with the purchase of the Maltings shopping centre in Salisbury from
    Town Centre Securities for £27.5m. The 8,900 sq m property includes a
    Sainsbury's supermarket, 27 accompanying retail units and adjoining car
    park.
   
  * Exchange of contracts by the Metro Shopping Fund, the 50:50 retail joint
    venture between Land Securities and Delancey, for the sale of the Victoria
    Place shopping centre, London SW1 for £92.5m to Ewart Properties Ltd.
   
Development activity

  * Outline planning consent given by Glasgow City Council for a 65,000 sq m
    extension of Buchanan Galleries shopping centre in Glasgow, which will
    enable Buchanan Galleries, our joint venture with Henderson, to become one
    of the UK's largest shopping centres, totalling 120,000 sq m.
   
  * Opening of our city centre retail developments at Corby and Cambridge which
    are 69% and 100% let or terms agreed+ respectively.
   
  * Progress on lettings at Cabot Circus in Bristol city centre, which we are
    developing in partnership with Hammerson, currently 75% let or terms
    agreed+. The development is due for completion in Autumn 2008.
   
  * Capital expenditure of £61.8m on Retail Portfolio developments during the
    quarter.
   
+ measured by rental income

LAND SECURITIES TRILLIUM

We were very active across all areas of Trillium's business in the third
quarter. We have seen strong performance on our existing outsourcing contracts,
made good progress in our new business initiatives and successfully launched
our £1.1bn Public Private Partnership Joint Venture fund, Trillium PPP
Investment Partners.

Outsourcing contracts

  * Disposal of a further 12,200 sq m of surplus space on the Department for
    Work and Pensions (DWP) contract, bringing our total leasehold disposals
    for the first nine months of the year to 47,500 sq m.
   
  * Vacation notices issued by DWP during Q3 on 34,100 sq m (66% leasehold and
    34% freehold), compared to 32,000 sq m (52% leasehold and 48% leasehold)
    issued in Q2.
   
  * Letting of a further 4,700 sq m on the surplus Royal Mail properties and
    agreeing terms to let a further 5,500 sq m during the quarter. We have now
    let 9,300 sq m of surplus space from this contract this financial year
    which is in line with our expectations.
   
  * Completion of the 30,900 sq m, £80m, three year refurbishment of Norwich
    Union's headquarters in Norwich within budget and three weeks early.
   
Trillium PPP Investment Partners

  * Establishment of Trillium PPP Investment Partners. We raised £568m of debt
    for the joint venture in November, followed by first close on equity
    raising on 14th December at which point we had firm commitments totalling £
    370m.
   
    The committed investors at the first close were HBOS, Victorian Funds
    Management Corporation of Australia, Bank of Ireland managed funds and Land
    Securities Trillium. We have strong interest from other investors and
    anticipate final close this financial year. Notwithstanding current market
    volatility, investors have found the long term, high quality income streams
    managed through the Trillium business particularly attractive.
   
New Business

  * Trillium, in joint venture with Northgate, selected as preferred bidder on
    the first Local Education Partnership (LEP One) for the Kent Building
    Schools for the Future (BSF) programme. Overall Kent BSF investment will be
    circa £1.8bn across three LEPs. LEP One requires a capital investment of
    some £550m in buildings, £190m of which is on a PPP basis. By 2014, 34
    educational establishments will be either replaced or improved. Trillium
    will invest 72% of the equity and provide 80% of the sub-debt (some £14m)
    under LEP One and will secure additional revenue streams in the form of
    lifecycle, SPV management and Facilities Management services.
   
  * Focus on the significant BSF market where we are currently bidding on three
    further BSF projects, including Birmingham BSF, which is the largest
    currently in procurement.
   
  * Regained momentum on the £300m Workplace 2010 project in Northern Ireland
    following resolution of a legal challenge by an unsuccessful bidder.
    Preparation of Best and Final Offer in competition with one other party now
    underway.
   
  * Completed acquisition of 25 interests in PPP projects for £247m bringing
    our total to £312m for the nine months to 31 December 2007. This included
    acquisition of a significant number of projects in deals negotiated on an
    exclusive basis, including purchases from Bilfinger Berger and Carillion.
    We also successfully integrated the AMEC team and investments into
    Trillium. With these acquisitions Trillium has cemented its position as the
    leading secondary investor in the PPP/PFI market.
   
FINANCE

As at 31 December 2007, the nominal value of our net debt (including joint
ventures but excluding non-recourse debt in the PPP contracts) amounted to £
6,179.5m (£6,605.0m at 30 September 2007) at an average cost of 5.6%. 74.0% of
our debt was fixed. The market value of our debt and related interest rate
swaps at 31 December 2007 was £6,102.3m.

During the quarter we bought back 450,000 shares at an average of 1427 pence
per share.

Land Securities commenced payment of quarterly dividends this year. The third
quarterly dividend will be 16.0 pence per share, of which 80% will be in the
form of a Property Income Distribution payment. This will be paid on 25 April
2008 to shareholders on the register at 14 March 2008. On an annualised basis,
this represents a 20.8% increase above the full year dividend for 2006/07. The
Group offers shareholders the option to participate in a Dividend Reinvestment
Plan (DRIP). For further details please refer to the Shareholder centre, within
the Investor section of our corporate website www.landsecurities.com.

                                   - ENDS -                                    

A conference call for analysts is being held today at 08:30 GMT

Conference call details:
UK dial in number: 0800 694 1503
International dial in number: [phone]
Call title: Land Securities Quarter 3 Interim Management Statement
Conference ID: 30312029

A replay facility will be available to listen to immediately following the call
for a period of 7 days

Encore Replay details:
UK dial in number: 0800 953 1533
International dial in number: [phone]
Access number: 30312029#


For further information, please contact:

Francis Salway                            John Sunnucks/ David Allchurch       
Donal McCabe/ Alison Flynn                                                     
Land Securities                           Tulchan Communications               
T [phone]                     T [phone]                


Forward Looking Statements

This document may contain certain `forward-looking' statements. By their
nature, forward-looking statements involve risk and uncertainty because they
relate to future events and circumstances. Actual outcomes and results may
differ materially from any outcomes or results expressed or implied by such
forward-looking statements.

Any forward-looking statements made by or on behalf of Land Securities speak
only as of the date they are made and no representation or warranty is given in
relation to them, including as to their completeness or accuracy or the basis
on which they were prepared. Land Securities does not undertake to update
forward-looking statements to reflect any changes in Land Securities'
expectations with regard thereto or any changes in events, conditions or
circumstances on which any such statement is based.

Information contained in this document relating to the Company or its share
price, or the yield on its shares, should not be relied upon as an indicator of
future performance.