* Posts 22 percent H1 fall in NAV per share
* Says CEO selection process continues
* Ropemaker Place London City offices 25 percent-plus let
(Adds quotes, shares)
By Sinead Cruise
LONDON, Nov 19 (Reuters) - The rapid UK property correction has stripped more than a billion pounds off the value of British Land's assets but its portfolio remains almost full as tenants seek refuge from the economic storm in prime shops and offices.
The UK's second-largest real estate investor -- seen as a bellwether for British property firms -- said the value of its portfolio including joint ventures, sank by 10.8 percent to 11.6 billion pounds ($17.46 billion) in the six months to September 30. Net asset value tumbled 22 percent to 1,043 pence a share.
But as Britain stares recession in the face, more corporate occupiers and retailers are taking space in the firm's landmark shopping centres and office towers, while existing residents continue to pay higher rents for their premises.
"We offer resilience in an otherwise uncertain market," said Chairman Chris Gibson-Smith. "Over the past few years we have reshaped our portfolio to focus on prime property... Our average lease lengths are 13 years with only 4 percent up for renewal in the next three years," he said.
British Land, which owns the Meadowhall shopping mall in Sheffield, northern England and the majority of the Broadgate Estate office complex in the City of London, said its portfolio remained 97 percent let and it had achieved more than 900,000 square feet of lettings in the six months.
It also posted like-for-like rental income growth of 4.2 percent versus the same period in 2007, beating industry benchmarks of 3.5 percent.
Bucking acute stress in London's City financial district, the company said it had provisionally let over a quarter of the office space at its 593,000 square foot Ropemaker Place office development, which is due to complete in 2009.
While the results were in line with estimates, shares were trading 3.1 percent down to 528 pence at 1058 GMT, lagging a 1.4 percent fall in the FTSE 350 Real Estate Index.
DEVELOPMENT PAUSE
British Land said its other key London City projects at Broadgate Tower and 201 Bishopsgate were more than 75 percent let but it had curtailed its office development programme to 1.1 million square feet and its Leadenhall skyscraper project remained on hold.
"It's a timing question, we need more information about how deep this is going to get, how long it will last and where reasonable prices are going back to. These are critical pieces of information we will wait patiently for," Gibson-Smith said.
Finance Director Graham Roberts said tenants representing less than 0.6 percent of British Land's total annual rent roll had defaulted over the six months but the level could rise in the New Year as occupiers struggled to cope with tightened consumer spending and restricted access to debt.
He also said he was pleased British Land had steered away from large-scale shopping centre development championed by rivals Westfield Group, who opened Europe's largest shopping mall in London last month.
"...One of the reasons we haven't got into big scale shopping centre development is because it actually takes many, many years to complete these things and you never know what cycle you are delivering into," Roberts said.
"We are 99 percent let in our retail, because we haven't done that in the UK on that scale... Anyone delivering a shopping centre in this market will find they have to give considerable incentives to tenants to let up," he said.
British Land's hunt for a replacement for former Chief Executive Stephen Hester -- who joined Royal Bank of Scotland last month -- was progressing well, Gibson-Smith said.
"The opportunity to become the CEO of a FTSE 100 company is something people will do a lot for, so we're not short of interest," said Gibson-Smith, adding that he hoped to name Hester's successor before Christmas.
(See www.reutersrealestate.com for the global service for real estate professionals from Reuters)
(Editing by Jon Loades-Carter)