St Modwen sinks into the red as losses hit 93.8m

PROPERTY developer St Modwen yesterday sank into the red as it reported losses had quadrupled to &pound;93.8m for the six months to the end of May.<br /><br />The group, which owns the Elephant &amp; Castle shopping centre, warned that it had seen no pick up in rental values in the commercial sector, but the residential market was beginning to show early signs of improvement.<br /><br />St Modwen, which specialises in redeveloping towns and cities across Britain, said its net asset value has fallen by &pound;80.9m to &pound;321.3m (266p per share), a decline of 20.4 per cent since 30 November 2008, amidst adverse market conditions.<br /><br />The group warned it expects some further reduction in values, principally due to the worsening climate for occupiers, and a consequent slowing of demand for new space, and increasing pressures on rental levels.<br /><br />The regeneration specialist, which tapped investors for &pound;102m in May, has scrapped its interim dividend to conserve cash and wiped &pound;68.6m off the value of its portfolio. Chief executive Bill Oliver said he expects further write downs of the estate in November, as pressures continue.