One unloved FTSE 100 dividend star I've got my eye on

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British Land shopping mall

While many stocks that plunged in the immediate aftermath of the Brexit Referendum have fought their way back to pre-vote prices, shares of British Land (LSE: BLND) still languish far below those levels. And although it's true that the outlook for commercial real estate is looking shakier now than it did back in early 2016, I think investors who are confident in the state of the economy may find British Land an interesting contrarian option.

The two factors that have most caught my eye about the company is an attractive valuation with its shares trading at around 34% below net asset value (NAV) and a 4.8% dividend yield that has few peers in the FTSE 100. Of course, these attractive metrics would mean nothing if a downturn were right around the corner, but British Land so far shows few signs of slowing down.

NAV did fall marginally last year from 919p to 915p year-on-year (y/y), but this was due mainly to reduced property valuations. Encouragingly, this looks to be mostly a knee-jerk reaction to the Brexit vote as prices rebounded a solid 1.6% in H2. Furthermore, its focus on creating attractive multi-use retail and commercial locations is paying off handsomely. Footfall is well ahead of rivals leading to sky-high 98% occupancy rates at year-end and like-for-like rental income growth of 2.9% across the portfolio.

Increased rents helped boost underlying operating profit by 7.4% y/y to £390m. This allowed for a 3% increase to dividends as well as a reduction in leverage with the headline loan-to-value ratio falling from 32.1% to 29.9% y/y. On top of the increased dividend, management is also moving forward with a £300m share buyback programme. That's because it wants to close the huge gap between share price and NAV, as well as seeing buybacks as a better use of cash with property values as elevated as they are.

With its shares as cheap as they have been in some time, massive shareholder returns on tap and impressively resilient operations, I reckon now could be a great time for contrarian investors to take a closer look at British Land.

Turning empty land into big profits

Another property firm that's caught my eye is brownfield land regeneration expert Harworth Group (LSE: HWG). The company's focus is redeveloping former industrial land into plots for commercial and housing purposes with a focus on the Midlands and North of the country.

So far these sites have proved impervious to Brexit-related fears due to constrained housing supply and continued demand growth for out-of-town commercial units. In the half to June, an increase in underlying profits and uplift in property valuations led to a 13.2% y/y rise in NAV to 117.4p.

Looking ahead, the company's prospects appear quite bright as it is moving along nicely with normal disposals of developed property and is still finding plenty of new brownfield sites to develop in the future. And with a loan-to-value ratio of just 2.5% at period end, the company is very well placed to both continue buying new sites and survive any potential downturn.

Harworth's annual dividend yield of 0.78% won't attract any income investors but with good growth prospects, low debt levels and its shares trading at a 13% discount to their NAV, I see many worse options out there in the property sector.

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Ian Pierce has no position in any of the shares mentioned. The Motley Fool UK has recommended British Land Co. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.