UPDATE 1-Shaftesbury NAV falls but confident on outlook

LONDON, Dec 3 (Reuters) - Shaftesbury (SHB.L) raised its dividend and remained confident of its outlook, even as the UK real estate firm posted a 25 percent drop in adjusted net asset value in full-year results amid a property downturn. The company, which owns about 1,000 properties in London's West End retail and business district, said on Wednesday that tenant demand for its shops, restaurants and apartments remained strong.

"The economy in the West End and our portfolio, with its defensive qualities of prime locations and mixed uses, have proved to be resilient," Chairman John Manser said.

Net asset value fell to 482 pence per share as of September 30, the group said. It declared a full-year dividend of 11 pence per share, up 44 percent from a year ago.

Manser said rental income continued to grow despite the ongoing gloom in the UK real estate market, and he expected to grow the company's portfolio through acquisitions as property valuations fall due to the financial crisis.

"Although it is impossible to say how long this economic downturn will prevail, we remain confident that, when the gloom lifts, Shaftesbury will emerge strongly positioned to benefit," he said.

(Reporting by Daryl Loo; Editing by Rupert Winchester)

(See www.reutersrealestate.com for the global service for real estate professionals from Reuters)