Capital & Counties buys London properties after Earls Court disposal
The London-focused landlord has £900m available for acquisitions
Capital & Counties (Capco), which was spun out of SA businessman Donald Gordon’s Liberty International in 2010, says it has £900m (R17bn) for new acquisitions and has already allocated some of it for two new properties.
The company recently sold its stake in London-based Earls Court for more than R8bn and is focusing on its iconic retail estate asset, Covent Garden.
Designed and laid out in 1630, Covent Garden was the first modern shopping square in London.
It has been the main revenue contributor for Capco while Earls Court, which is being expanded to accommodate thousands more people, has been a laggard.
Capco CEO Ian Hawksworth said earlier in 2019 the two assets needed to be housed separately because of the wide divergence in their performances.
Covent Garden had been performing well despite Brexit uncertainty, but the value of Earls Court has been eroded.
At the end of June Covent Garden was valued at £2.6bn (R49bn), reflecting an increase of 0.5% compared with December 2018, supported by regular income growth and upward rental reversions.
Covent Garden spans about 112,000m² of lettable space across 79 buildings and 526 units.
The company said on Monday it has invested £50m to acquire two properties on the southern side of Covent Garden, including £34m for 5-6 Henrietta Street, a multi-let building. The building produces annual rental income of £1.2m across 1,328m2, most of which is restaurant space.
In November, Capco also acquired the freehold interest of Sussex Mansions, 36-39 Maiden Lane, for £17.8m, before purchasing costs.
The company’s share price had lost 0.45% to R46.14 on Monday morning, paring its year-to-date gain to 8.95%.