British Land has launched a £740m rights issue to shore up its balance sheet.

British Land today became the second of the major listed property companies after Hammerson on Monday to tap its shareholders for much- needed equity.

It is issuing 340.9m new shares at 225p each, which is more than half its share price and reflects a 69% discount to its 31 December net asset value of 718p a share.

The issue, like Hammerson's, is fully underwritten - by Morgan Stanley, UBS and GIC Real Estate, which is a shareholder in British Land.

The other two major property companies, Land Securities and Liberty International, are also expected to launch rights issues in the coming weeks to repair the damage inflicted by the sharp drop in property values since the credit crunch began in the middle of 2007.

British Land's new chief executive Chris Grigg said the rights issue 'further strengthens the balance sheet during a period of market dislocation. Additionally, we have enhanced our ability to exploit commercial real estate buying opportunities as they emerge'.