London pub operator, Capital Pub Co(the) (LON:CPUB) said this morning that current trading continued to be significantly ahead of last year, reflecting the strength of the London economy and the group’s well-positioned estate of pubs. The news came as the group announced the sale of the Marquis of Granby pub for £3.49m and a new revaluation of its estate. It has also just raised £1.7m in a 100p share placing with a fund run by real estate investor Moorfield.

Capital Pub, which recently won “Managed Pub Company of the Year” (below 100 outlets) at The Publican industry awards, said proceeds from the sale of the Marquis of Granby and new fundraising would be used to reduce borrowings to approximately £23.3m. In response, shares in the company fell by nearly 5% to 96.5p.

The latest revaluation by AG&G Chartered Surveyors resulted in a book value of the freehold and leasehold estate totalling £64m (excluding the Marquis of Granby). The estate was last revalued in February 2007 when the figure topped £70m. The revaluation included all houses within the estate with the exception of two recently acquired pubs, one leasehold pub and one pub held as an investment property.

Clive Watson, the chief executive of Capital Pub, said: “Current trading remains strong and whilst we remain cautious regarding the economy following the General Election, we are encouraged by the strength of the London market. We welcome MREF II Investments as a significant shareholder in the company and we look forward to working with Moorfield and leveraging their significant real estate and investment experience. Both the disposal of the Marquis of Granby and the placing have reduced gearing and strengthened the balance sheet significantly. This provides the company with a platform to continue the future growth of the business.”

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