Capco to go bigger to benefit from global demand
THE UK-focused property group Capital & Counties (Capco) was focusing on larger-scale developments to benefit from global demand, the company said yesterday.
CEO Ian Hawksworth said yesterday, after the release of Capco’s half-year results to June 30, that the company was unlocking the potential of its assets through an entrepreneurial and active asset-management strategy to create sustainable long-term value.
JSE- and London-listed Capco was spun off from Liberty International in March 2010.
Mr Hawksworth said the company was well positioned in central London, particularly across the retail and residential sectors, both of which performed strongly. The company’s crown jewel is the Covent Garden estate in central London.
“The strategy of creative regeneration in its Covent Garden estate has seen a transformation of the retail and restaurant offering in the area, while also enhancing and improving the public realm and the fabric of the historic district, retaining its character and attracting a new customer demographic into the area,” Mr Hawksworth said.
He said London still outperformed the general UK property market and was cementing its reputation as a global city and an international investment destination.
“While the macroeconomic cli- mate continues to be uncertain, the London property market remains robust in both the retail and residential sectors, with increasing demand from Russia, Asia and other European countries.”
Mr Hawksworth said the Olympic Games had placed a spotlight on London, showcasing the city to an international audience and increasing exposure and awareness that was likely to have a lasting positive effect on the capital.
“The central London retail market remains strong, continuing the differentiation from the rest of the UK, and new international retailers continue to be attracted to the capital. London, as a world city, remains a flagship destination, where retailers are prepared to pay substantial premiums and rents for stores on the best prime streets.”
He said that in a continuation of a trend established late last year, demand outweighed supply in the major West End shopping streets.
In the residential market, London outperformed the rest of the UK. “On average, residential prices currently exceed the September 2007 peak in all prime central London markets and international purchasers still make up a large portion of buyers in prime locations in London,” Mr Hawksworth said
Capco proposed an interim dividend for the half-year of 0.5p a share, to be paid on September 18.
The company’s net asset value increased 6.6% in the period to 177p, but like-for-like net rental income fell 4.9% to £34.1m, a reduction of £2.6m on the first half of last year.
The company said the continued uncertainty surrounding the business venues at Earls Court had resulted in lost shows and a reduction in the size of certain exhibitions retained there.