Land Secs holds off £13.6bn portfolio demerger

Land Secs chief executive Francis Salway

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Land Securities is putting the planned demerger of its £13.6 billion property portfolio on hold until the economic climate improves.

The developer announced the three-way demerger last November and had hoped to wrap up the deal by early next year.

But in a trading update today, chief executive Francis Salway said: "Implementation will be taken forward when market conditions are favourable. We are prepared to be patient but it would be inappropriate to speculate on the timing."

The developer has also been assessing offers for its property outsourcing arm Trillium.

Land Secs announced in February that it would be running an expressions of interest campaign parallel to the demerger to sell off its.

Mr Salway refused to reveal the bidders or a potential value but it is thought a consortium made up of investment fund William Pears, Australian bank Macquarie and Goldman Sachs' Whitehall fund has tabled a £900 million bid.

Land Secs finance director Martin Greenslade said the sale was not finalised and added: "There comes a time when you have to set a deadline but we have not reached that point yet."

The first quarter trading statement remained relatively upbeat despite the company having posted an £888 million loss in its annual report in May.

Mr Salway said: "We remain well positioned with moderate gearing, proven leasing skills and limited development completions in London over the next two years.

"This gives us the confidence to progress planning applications for projects to be delivered in the next decade and also the flexibility to take advantage of opportunities which may arise."