Shares in Capital & Regional fell this morning as the company revealed further falls in the value of the property in its three main funds.

The co-investing fund manager saw shares fall 4% to 530p compared to a FTSE All-share index fall of 2%, and a half point gain in the European Public Real Estate Association index.

The £2.9bn Mall shopping centre fund is the worst performer in 2008 for Cap & Reg. It fell 1.8% in February, and has fallen 3.8% in 2008. Investors in this fund have seen a geared return of -8.5% this year.

Worst performer

Last year’s worst performer, the £1.2bn Junction retail park fund, saw a 1.4% drop in January, leaving it 1.9% down in 2008, and investors nursing a geared loss of 4.3%.

Cap & Reg shares had surged 9% on Tuesday after a reassuring set of 2007 results. Investors had worried that falling property values in the company’s funds might lead to the company breaching loan-to-value covenants. Cap & Reg reassured the market that this was not the case, that it had substantial cash reserves and also revealed it has only £8m of debt due for refinancing this year.

On Monday, founding chief executive left the company, 18 months earlier than his proposed exit date. He will be replaced on 1 April by Hugh Scott-Barrett, former chief finance director of ABN Amro.