St Modwen Properties has warned that it cannot offset worse-than-expected falls in commercial property prices through its asset management programme.

In an interim management statement for the three months to the end of September, the group said the market for residential land 'remains virtually non-existent' and occupational property was also weakening.

The specialist in town centre regeneration, restructuring partnerships, brownfield land renewal and heritage restoration said the UK property market and the economy as a whole were deteriorating and it did not expect the residential market to recover for some time.

The group, which owns the Elephant & Castle shopping centre in south London, said its efforts would now be directed towards staying within banking covenants and securing the long-term potential of the business.

Its chairman has described the market as the most difficult it had faced since 1990.

Financial Times, The Times