Land Securities said today it had stopped work on its planned demerger, as it posted a 20.7% drop in its net asset value.

Announcing its half-year results, LandSecs said adverse market conditions had forced it to abandon plans to split its London property, UK retail and property outsourcing arms into separate businesses, although a sale of outsourcing arm Trillium was still ongoing.

Our board continues to believe in the benefits of specialisation, but has decided that, given the current financial environment, it would not now be in our shareholders interest to proceed with demerger,’ said chief executive Francis Salway. ‘So, the file is closed.’

The company also appointed Alison Carnwath as chairman with immediate effect, following the resignation of Paul Myners on 3 October.

Its net asset value dived by 20.7% to 1,552p a share in the six months to 30 September, driven by a 12.7% plunge in the value of the retail and London portfolio, excluding Trillium, to £12.1bn.

However, the company posted a 13.3% rise in revenue profits to £195.8m and increased the interim dividend by 3.1% to 33p a share.

It completed 1.1m sq ft of development over the half-year period, of which 92% has been let. But vacancies across the like-for-like property portfolio crept up to 4%, versus 3.4% in March.