Issue of Debt

British Land Co PLC
21 January 2005

                                                                 21 January 2005



             BRITISH LAND PLANS £2.1 BILLION BROADGATE REFINANCING
 Additional £500 million raised, interest costs reduced by £12 million per year
              Group debt maturity extended from 13.8 to 16.6 years




The British Land Company PLC ("British Land") announces plans for a major
refinancing of its 4 million sq ft Broadgate Estate in the City of London, EC2
(the "Proposed Transaction"). The proposed new financing is expected to amount
to £2.073 billion(1) at a weighted average interest rate of approximately 5.1%,
significantly below the net initial yield on the Estate of 6.0%.



Background

The Broadgate Estate was first securitised in 1999 through the issue of £1.540
billion bonds at a funding rate of 6.1%.  Since that time, the bonds have been
amortised out of the surplus income of the Estate, reducing the amount
outstanding to £1.294 billion.  In addition, British Land has purchased further
properties such that it now owns the entire Broadgate Estate.  The Estate
provides over 4 million sq ft (370,000 sq m) of prime space on a 30 acre (12
hectare) site located in the heart of the City.



As part of the Proposed Transaction, four further properties, Exchange House,
135 Bishopsgate (currently subject to its own standalone securitisation), 1
Appold Street and the newly developed 10 Exchange Square will be added to the
security pool, which will then comprise all 15 commercial properties of the
Broadgate Estate.



Effect on Existing Bondholders

Fixed rate bondholders will receive new bonds, secured on the enlarged Estate
and issued at current market fixed coupons, with a compensating increase in
nominal value of approximately £129 million to reflect the lower interest rate.



Bondholders will gain from a more diverse security pool and tenant base, as well
as greater liquidity as a result of the larger number of bonds in issue.  They
will also receive a fee.  Floating rate bonds will be redeemed in cash.



Effect on British Land(2)

British Land will raise £500 million of additional long-term funding from the
refinancing, which will contain improved prepayment provisions. This will be
used to pay down other group debt.



The refinancing will reduce ongoing interest costs by approximately £12 million
per year as the new financing will be at the attractive rate of 5.1%.



British Land will incur a pre-tax exceptional charge of £178 million, mainly due
to the difference between the redemption value and book/nominal value of its
existing Broadgate debt. Against this, its FRS 13 disclosure (the extent by
which the market value of debt and derivatives exceeds book/nominal value) will
reduce by £170 million. There will thus be virtually no effect on British Land's
NNNAV, "triple net" asset value, that is, broadly, net asset value ("NAV") less
the FRS 13 disclosure and less contingent capital gains tax.  NAV will be
reduced by 24p per share.



The weighted average maturity of the Broadgate debt will be extended from 16.4
to 19.8 years.  In consequence, the weighted average maturity of British Land's
entire group debt will rise from 13.8 to 16.6 years, and its weighted average
interest cost will decline from 6.5% to 6.1%.



The Proposed Transaction, which is subject to the approval of holders of each
class of the existing fixed rate bonds, is expected to complete in early March
2005.



Commenting on the Proposed Transaction, Nick Ritblat, a director of British
Land, said:

"This major refinancing of the Broadgate Estate has been approved by a Special
Committee of the ABI representing 50% of the fixed rate bonds.  It offers
significant benefits to current holders of Broadgate bonds, to British Land
shareholders and to its unsecured lenders.



For bondholders the new financing will be fully secured on a broader and more
diverse collateral pool of Broadgate's prime assets and the new bonds are
expected to have greater liquidity.



For shareholders there is improved financing flexibility and a reduced interest
charge going forward.



For unsecured lenders the pro forma ratio of unsecured debt to unencumbered
assets will decrease from 40% to 29%."


 Notes:

(1) Throughout this announcement, the nominal value and coupons of the New
    Bonds are stated based on market pricing at the close of business on 
    19 January 2005.

(2) Throughout this announcement, the financial effects of the Proposed
Transaction on British Land are stated on a pro forma basis as though it had
completed on 30 September 2004 assuming the number of shares in issue as at that
date and using the assumed nominal value and coupons of the New Bonds as
described in note (1) above. The actual financial effects, including the nominal
value and coupons of the New Bonds issued and the accounting charge that will be
incurred by British Land, will be determined by interest rates on the Pricing
Date.




The Proposed Transaction

Broadgate Financing PLC, a wholly owned subsidiary of British Land, is proposing
to issue new bonds totalling approximately £2.073 billion (the "New Bonds")
secured on the Estate and the existing £1.294 billion bonds issued by Morgan
Stanley Mortgage Finance (Broadgate) PLC (the "Existing Bonds") are proposed to
be redeemed.



Under the Proposed Transaction, which is subject to the approval of holders of
each class of the existing fixed rate bonds:

•   British Land will be contributing four additional properties from the
Broadgate Estate (Exchange House, 135 Bishopsgate, 1 Appold Street and 10
Exchange Square) to the security pool of the existing securitisation structure.
This will allow British Land to raise an additional £650 million of financing at
attractive rates, comprised of £500 million of fixed rate bonds and £150m of
floating rate bonds. The additional financing will be used to repay other
British Land group debt, including £115 million currently secured against 135
Bishopsgate.

•   The Existing Bonds will be refinanced as follows:

-   £834 million of Existing Bonds with fixed rate coupons (the "Existing
Fixed Rate Bonds") will be redeemed at the applicable redemption price together
with an early redemption fee.  Subject to certain exceptions, the redemption
price will be settled by delivery to the holders of new fixed rate bonds of
Broadgate Financing PLC (the "New Fixed Rate Bonds") issued at current market
coupons with a compensating increase in nominal value of approximately £129
million so as to provide the same yield to maturity as the Existing Fixed Rate
Bonds.  Accrued interest will be paid in cash.  In addition, holders of the
Existing Fixed Rate Bonds ("Existing Fixed Rate Bondholders") will receive an
early redemption fee payable in cash in an amount equal to 0.6% of the current
nominal principal amount of their Existing Fixed Rate Bonds (the "Early
Redemption Fee").  Each class of the New Fixed Rate Bonds is expected to be
assigned ratings equivalent to the existing ratings on the corresponding class
of Existing Fixed Rate Bonds.

-  The remaining £460 million of the Existing Bonds which have floating
rate coupons (the "Existing Floating Rate Bonds") will be redeemed in cash on
the interest payment date falling due on 5 April 2005 in accordance with their
existing terms.  The Existing Floating Rate Bonds will be redeemed out of the
proceeds of new floating rate bonds proposed to be issued by Broadgate Financing
PLC.

•  The New Bonds will be fully secured and further modifications will be
made to the covenant and security packages appropriate to a fully secured
structure in line with current rating agency requirements.  The New Fixed Rate
Bonds will also provide for early redemption at the option of the issuer at an
amount determined by reference to the redemption yield on the appropriate
European Investment Bank bond.


Following the Proposed Transaction, it is expected that the total nominal value
of the outstanding debt secured on the Estate issued by Broadgate Financing PLC
will be approximately £2.073 billion. The actual amount will depend on the final
pricing determined by reference to interest rates on a date near the date of
completion (the "Pricing Date").


Morgan Stanley Mortgage Finance (Broadgate) PLC has today published a Consent
Solicitation Document (containing a Preliminary Offering Circular in respect of
the New Bonds) setting out proposals to the Existing Fixed Rate Bondholders (the
"Proposals") and setting out terms for the New Bonds.



The Consent Solicitation Document contains notices convening meetings of each
class of the Existing Fixed Rate Bondholders for 14 February 2005 to consider
and, if thought fit, approve Extraordinary Resolutions to effect the Proposals.
Subject to the Proposals being approved and the conditions specified in the
Consent Solicitation Document, Existing Fixed Rate Bondholders who deliver valid
voting instructions together with valid certificates of eligibility (which are
not subsequently revoked or withdrawn) before 5.00 pm on 7 February 2005 will be
entitled to receive a further fee (in addition to the Early Redemption Fee)
payable in cash in an amount equal to 0.4% of the current nominal principal
amount of their Existing Fixed Rate Bonds (the "Early Solicitation Fee").  The
expiration date for Existing Fixed Rate Bondholders to submit completed voting
instructions and eligibility certificates in order to vote at the meetings is 10
February, 2005.  Assuming the Proposals are approved, the Proposed Transaction
is expected to complete in early March 2005.



Financial impact and Rationale for British Land

Under the Proposed Transaction, British Land will be raising over £2 billion of
financing secured on the Estate in a single enlarged securitisation structure
with improved prepayment provisions and sufficient flexibility to address its
business needs going forward.  The contribution of further properties to the
security pool will enable British Land to raise an additional £650 million of
financing from the enlarged securitisation structure at attractive rates.  After
repayment of £115 million of debt currently secured against 135 Bishopsgate, the
costs of closing out existing hedging instruments and payment of transaction
costs, the net additional amount of financing raised will be approximately £500
million. The transaction is being proposed following recent changes to the terms
in the existing unsecured debt of British Land which allow the funding structure
for the Estate to be simplified, reducing costs and producing advantages for
both bondholders and British Land.  If approved, the Proposed Transaction will:

• reduce the weighted average cost of all debt secured on the Estate
from the current 6.2% to approximately 5.1%, a level which is significantly
below the net initial yield on the Estate of 6.0%(3);

• reduce British Land's future interest charge by approximately £12
million per year;

• reduce the weighted average cost of British Land's group debt on a pro
forma basis from 6.5% to approximately 6.1%; and

• extend the weighted average maturity of British Land's group debt on a
pro forma basis from 13.8 years to 16.6 years.



(3)   Excluding 10 Exchange Square which was recently completed and is valued on
an equivalent yield basis due to vacant space.



Hedging instruments associated with the Existing Bonds and other existing debt
to be refinanced under the Proposed Transaction will be closed out and new
hedging arrangements put in place.

The Proposed Transaction, if approved and completed, will result in British Land
incurring an exceptional accounting charge against pre-tax profits in the year
ending 31 March 2005 of approximately £178 million.  The charge results from a
number of factors:

                                                                    (£ million)
Difference between redemption value and book/nominal                       129
value of existing Broadgate debt 

Write back of debt issue costs previously deducted from the                 22
principal amount of debt recorded under FRS 4

Net costs of closing out the existing hedging instruments                   19
associated with the Existing  Bonds and other debt to be 
refinanced under the Proposed Transaction

Early Redemption Fee and Early Solicitation Fee (4)                          8

Total                                                                      178





(4)   The Early Solicitation Fee is assumed to be payable to all Existing Fixed
Rate Bondholders, though the actual amount will depend on the number of such
bondholders submitting their voting instructions prior to 7 February 2005.





Excluding the one-off charge, the Proposed Transaction is expected to result in
a recurring annual positive impact on pre-tax profits of approximately £12
million. After tax, the corresponding annual impact on earnings is expected to
be approximately £8 million, equivalent to approximately 1.5 pence per share.



The impact of the exceptional charge will be to reduce net asset value ("NAV")
by £125 million, equivalent to 24 pence per fully diluted share and 2.3% of
British Land's fully diluted adjusted NAV per share as at 30 September 2004. (5)



(5)   Adjusted net asset value per share as at 30 September 2004 of 1,049 pence,
stated after adding back the £113.6 million capital allowance effects of FRS 19
and the £82.9 million surplus on development and trading properties.



Based on market prices at the close of business on 19 January 2005, the Proposed
Transaction would result in a reduction in the difference between the market and
book values of debt and derivatives disclosable in British Land's group accounts
under FRS 13 of £170 million, equivalent to 23 pence per share after tax.  The
equivalent difference between market and book values disclosed in British Land's
interim accounts as at 30 September 2004 was £138 million, equivalent to 32% of
the total difference as at 30 September 2004.  As a result of this there will be
virtually no effect on British Land's 'triple net' asset value (NNNAV).(6)



(6)   NNNAV is equal to adjusted net asset value less the post tax difference
between the market and book values of debt and financial instruments disclosable
under FRS 13, less the unprovided tax that would arise on disposing of British
Land's group properties, after available tax relief but without recourse to tax
structuring, net of negative goodwill.



Pro forma gearing will increase from 90% to 96% as a result of the
crystallisation of the FRS 13 mark to market value of the debt and derivatives
being refinanced under the transaction. The pro forma ratio of unsecured debt to
unencumbered assets will decrease from 40% to 29% as the result of repaying
unsecured debt out of the proceeds of the transaction.





Benefits for Existing Fixed Rate Bondholders

The Proposed Transaction offers a number of benefits to the Existing Fixed Rate
Bondholders including:

•   the security pool will be enlarged to 15 properties (compared to 11
properties currently), providing increased diversity and following enlargement
will comprise the entire built Estate;

•   the new buildings will add further high quality tenants, increasing
tenant diversity;

•   the New Bonds will benefit from a fully secured structure;

•   Existing Fixed Rate Bondholders will have the opportunity to purchase
additional fixed rate bonds from the new issuance of £500 million;

•   liquidity is expected to increase as a result of the increase in the
aggregate issue size, with the total value of outstanding fixed rate bonds
increasing by approximately 52%; and

•   by receiving New Fixed Rate Bonds at market coupons and increased
nominal value to provide the same yield to maturity, Existing Fixed Rate
Bondholders will obtain security over the premium to nominal value at which the
Existing Fixed Rate Bonds are trading.

In addition, Existing Fixed Rate Bondholders will receive the Early Redemption
Fee and have the opportunity to receive the Early Solicitation Fee which
together amount to 1.0% of the current nominal principal amount of their
Existing Fixed Rate Bonds.



A Special Committee of the Association of British Insurers, representing
approximately 50% by nominal value of the Existing Fixed Rate Bonds, has
considered the proposals. The members of the Special Committee have indicated
that they find the proposals acceptable, that they intend to vote in favour of
the proposals in respect of their holdings and that they will be inviting other
ABI members to consider a similar course of action.



Indicative terms of the Proposals

Under the Proposals, the yield at which the Existing Fixed Rate Bonds will be
redeemed will be equal to the sum of the relevant Benchmark Reference Security
Yield on the Pricing Date and the applicable quarterly fixed spread as stated in
the table below (the "Redemption Yield").  Subject to certain exceptions, the
redemption price will be settled by delivery to the holders of New Fixed Rate
Bonds with a coupon equal to the quarterly equivalent of the Redemption Yield.
Existing Fixed Rate Bondholders who are not able to confirm that they are
eligible to receive the New Fixed Rate Bonds will be redeemed, at the discretion
of Morgan Stanley Mortgage Finance (Broadgate) PLC, in cash.



Indicative terms of the Proposals to Existing Fixed Rate Bondholders based on
yields on 19 January 2005 are summarised in the table below.


Class  Existing  Existing   Final      Benchmark    Redemption    New      New
       Nominal    Coupon    Maturity   Reference     and         Nominal  Coupon 
                                        Security    new issue      (1)     (1)
                                                     spread

A2     £284m     5.927%     2031       8's of 2021    40 bps     £312m    4.929%

A3     £150m     5.912%     2033       6's of 2028    40 bps     £173m    4.853%

B      £225m     6.287%     2033       6's of 2028    55 bps     £265m    5.001%

C2     £175m     6.651%     2038       6's of 2028    65 bps     £213m    5.099%

       £834m     6.173% (2)                                      £963m    4.973%



(1) Illustrative pro forma based on market pricing at the close of business on
19 January 2005.

(2) Average cost of debt weighted by nominal value.

(3) Final pricing will be determined by reference to yields on the relevant
Benchmark Reference Securities on the Pricing Date.

(4) Existing Fixed Rate Bondholders will also receive accrued interest payable
in cash.



Enquiries:

The British Land Company PLC
John Weston Smith                                         Tel.: [phone]
Nick Ritblat                                              Tel.: [phone]

Morgan Stanley
May Nasrallah (for matters relating to the                Tel.: [phone]
Consent Solicitation)

Tim Drayson (for all other matters)                       Tel.: [phone]

Finsbury
Edward Orlebar                                            Tel.: [phone]




Important notice

The contents of this press release, which have been prepared by and are the sole
responsibility of British Land, have been approved by Morgan Stanley & Co.
International Limited solely for the purposes of section 21(2)(b) of the
Financial Services and Markets Act 2000.  Morgan Stanley is acting for British
Land and Morgan Stanley Mortgage Finance (Broadgate) PLC in connection with the
Proposed Transaction and no one else and will not be responsible to anyone other
than British Land and Morgan Stanley Mortgage Finance (Broadgate) PLC for
providing the protections offered to clients of Morgan Stanley nor for providing
advice in relation to the Proposed Transaction.  The address of Morgan Stanley
is 25 Cabot Square, Canary Wharf, London E14 4QA.



This press release does not constitute an offer to sell or the solicitation of
an offer to buy securities of Broadgate Financing PLC.  Nothing in this press
release constitutes advice on the merits of buying or selling a particular
investment or exercising any right conferred by the securities described.  Any
investment decision as to any purchase or securities referred to herein must be
made solely on the basis of information contained in the final form of the
Offering Circular and no reliance may be placed on the completeness or accuracy
of the information contained in this press release.



Securities are not suitable for everyone.  The value of securities can go down
as well as up.  You should not deal in securities unless you understand their
nature and the extent of your exposure to risk.  You should be satisfied that
they are suitable for you in the light of your circumstances and financial
position.  If you are in any doubt you should consult an appropriately qualified
financial advisor.



Notes to editors:

The Broadgate Estate is the premier City of London office estate. It comprises
over 370,000 sq m (4.0 million sq ft) of office, retail and leisure
accommodation on a 12 hectare (30 acre) site adjoining Liverpool Street station
with mainline and underground rail connections. The assembly of the entire
estate into British Land's ownership was completed by the acquisition in March
2003 of the virtual freehold interest at 1 Appold Street. Construction of 10
Exchange Square, adding a further 15,180 sq m (163,400 sq ft) to the Estate, was
recently completed in May 2004. Broadgate Estates Limited, a wholly owned
subsidiary of British Land, manages the estate and maintains the external and
common areas. Approximately 30,000 employees are based at Broadgate, which forms
a distinctive environment for some of the world's largest corporations and
leading professional practices, including ABN AMRO, Allianz Dresdner, Ashurst
Morris Crisp, Barclays Bank, Baring Investment Services, Deutsche Bank, European
Bank for Reconstruction & Development (EBRD), F&C Management, Herbert Smith,
Lehman Brothers, Royal Bank of Scotland, Societe Generale, Sumitomo Trust, Bank
of Tokyo Mitsubishi and UBS.



British Land and Morgan Stanley first securitised the Broadgate Estate in May
1999 through the issue of £1.54 billion bonds in what was then the largest ever
securitisation of property assets in the United Kingdom.



Morgan Stanley & Co. International Limited is acting as the Solicitation Agent
and Arranger in connection with the Proposed Transaction.


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