British Land to sell stake in London's "Cheesegrater" -source

(Adds source, analyst comments, details, context)

By Esha Vaish

Nov 3 (Reuters) - British Land Company Plc, one of London's biggest office landlords, is looking to put its 50 percent stake in the "Cheesegrater" skyscraper in the financial district up for sale, a person familiar with the matter told Reuters.

The company is valuing its stake at about 500 million pounds ($620 million), according to the source, who said the sale could fetch some premium due to the building's status in London.

British Land (LSE: BLND.L - news) declined to comment.

The Cheesegrater is one of London's tallest commercial towers and has a distinctive tapering shape. It was one of the first projects restarted by British Land after the 2008 financial crash and was considered a risky bet at the time.

The company built the tower - officially the Leadenhall Building - without substantial pre-lease commitments as it anticipated a shortage of premium commercial space in the British capital. It is co-owned with Oxford Properties.

The UK's commercial property market was one of the biggest victim's of Britain's vote to leave the European Union, as investors grew concerned that financial firms would move jobs to Europe, hurting rental demand for office property in the capital.

Although data from property consultant CBRE showed a rebound in office space take-ups in London in the third quarter from a second-quarter slump, many financial firms have warned they may still move if Britain's exit costs them their ability to service clients across the continent.

Property consultant Colliers has said London office vacancy levels have been rising, while others have indicated that negotiations for new leases were taking longer and rents were beginning to fall.

However, the source said British Land's valuation for Leadenhall had not seen any post-Brexit cut, as the building was fully let on long-term leases.

British Land announced in July that the Cheesegrater was fully leased out, after existing tenants Kames Capital, MS Amlin and Rothesay Life committed to rent the remaining three floors.

Once a building is fully let, the seller generally gets the best prize for it as potential buyers are attracted by the strength of the long-term income generated from leases.

Peel Hunt analyst James Carswell said the building would be attractive to an overseas buyer, especially due to the pound's slide to multi-year lows since Brexit.

British Land could look to use the proceeds to fund its Broadgate development in London without taking on further debt, as it already had a higher loan-to-value ratio than its closest rival Land Securities (LSE: LAND.L - news) , Carswell said.

Oxford Properties, which invests in real estate for OMERS - one of Canada's largest pension plans - is seen as a potential buyer. Oxford Properties was not immediately available to comment.

The source said no buyer had come forward yet as plans were in early stages. (Reporting by Esha Vaish in Bengaluru; Editing by Ruth Pitchford and Elaine Hardcastle)