Capital and Counties has slashed the value of its 7,500-home Earls Court scheme by 14 per cent over concerns that Brexit will cause house prices to fall.
The developer said the valuation of the scheme now stands at £1.2bn, down from £1.4bn in December 2015, for the six months ended 30 June 2016.
“The downward move in property valuations reflects the valuers’ assessment of the weakened sentiment in the central London residential market following the EU referendum,” it said.
“The valuer has reflected a higher risk premium post the EU referendum through a higher developer’s margin for consented development land as well as trimming sales values.”
The masterplan is currently consented to provide 7,500 new homes, including Lillie Square, which includes 608 private and 200 affordable homes across three phases.
Lillie Square launched in 2014 and has pre-sold 44 per cent to date, representing £300m of sales across the development.
Construction of phase one by Sir Robert McAlpine is under way, with first completions due later in the year.
The developer said the rate of sales in the second phase, which Sir Robert McAlpine is also favourite to build, slowed in the run-up to the EU referendum, with 41 of the 70 units released for sale being either reserved or exchanged.
Capco chief executive Ian Hawksworth said: “Whilst the last quarter has been characterised by uncertainty in the London market as a whole, the value of this estate will increasingly be realised in the years ahead.”
The group’s total property value was down 4 per cent to £3.6bn, from £3.7bn last December, while net assets stood at £2.9bn, down from £3.1bn.
CN visits Earls Court
Open Doors 2016_Keltbray_Earls Court 1
The Earls Court site opened up its gates during Open Doors week in June.