A major residential development site at Earl’s Court shed more than 15 per cent of its value in 2018, the site’s developer Capital & Counties said, in a sign of the depth of a decline in demand for prime new-build London housing.
The site, made up of several land parcels that amount to about 77 acres, dropped in value by 15.6 per cent to £658m during the year, Capital & Counties said on Wednesday. This helped widen the group’s losses to £56.9m from £0.4m a year earlier.
However, the value of the London-listed group’s portfolio of Covent Garden properties rose 1.6 per cent to £2.6bn, so its overall portfolio value was down 2.4 per cent to £3.3bn.
“The ongoing political and macroeconomic uncertainty continues to impact the London residential market resulting in a decline in the value of our investments at Earls Court,” said the chairman Henry Staunton.
Capco is considering a demerger of the company’s two parts and has held talks with potential buyers of the Earl’s Court portfolio, which has also been hit by political opposition within Hammersmith & Fulham council, one of two councils that govern the site.
“Preparations for a possible demerger are well advanced and could be implemented promptly,” it said on Wednesday, without any further update on specific plans.
The company sold the Empress State building, part of the Earl’s Court site, for £250m during the year.
Underlying earnings per share, which strip out property price moves, were down to 0.9p from 1.3p a year earlier.