UK-based Capital & Counties (Capco) is on track to split into two property companies, one focusing on a mega residential development at Earl’s Court and the other owning the iconic retail centre Covent Garden. Fund managers have said the group will perform more efficiently if its two large property assets are run separately with strong balance sheets. Capco has been poorly rated by analysts because of delays that it faces at its Earl’s Court development, where it is building 92,903m² in housing, while its Covent Garden development is excelling. Nesi Chetty, head of property at MMI Investments, said Capco had been an "underperformer for years", ever since its creation out of the former Liberty International. "About 80% of Capco’s exposure is to Covent Garden, but it gets undervalued as a company because investors attach so much risk to Earl’s Court. Many investors would welcome the company being split in two," Chetty said. Capco, which gave an update on the demerger with the release ...

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