By Nick Wilson

Listed property share prices in the UK have fallen from their peak at the beginning of the year because of the perception that property as an asset class is sensitive to interest rate changes.

But David Fischel, CE of UK-based property company Liberty International, which has a significant South African shareholding, said on Monday that this perception was not necessarily true for all property, and properties affected most by rising interest rates were those bought by "debt-driven buyers".

Fischel, who was delivering a presentation to property analysts on a visit to Liberty International's property sites, said that these affected properties tended to be "secondary" to the prime landmark retail assets in an area.

Liberty International's share price peaked at just more than £ 14 early this year, but had fallen about 20% in line with the rest of the sector.

The stock was now trading at just more than £11 .

Fischel said the drop in prices came after the sector experienced a "tremendous run" in prices last year and rises in interest rates.

There was generally a "knee-jerk reaction" when interest rates went up with some sell-offs, said Fischel.

But he said Liberty International, which focused on investment in prime properties such as regional shopping centres, would not be affected by rising interest rates as far as its liabilities were concerned because it had fixed rates on its debt.

Retailers were also "looking to expand and looking for quality space in the right size".

Retail sales had also been strengthening this year with retail price inflation running higher than 4%, said Fischel.

Meanwhile, there had been significant interest from international retailers in space at the Covent Garden retail precinct.

Liberty International subsidiary Capital & Counties owns 36 properties in Covent Garden, and is the dominant landlord in the area. The group's initial property acquisition in Covent Garden took place last August.

In the first quarter of this year Capital & Counties also acquired the retail component of the Royal Opera House at Covent Garden. The company's holdings in Covent Garden now came to £625m altogether.

Capital & Counties MD Ian Hawksworth said there was a "lot of international interest" in Covent Garden. "Everyone knows Covent Garden. It is one of the most well-known retail destinations in the world.

"We've seen a lot of interest from European retail brands wanting to get into the UK," said Hawksworth.

Covent Garden is London's oldest square, and it was originally constructed as a premium residential address in 1631 and then evolved into London's trading centre. In modern times it has changed into a speciality retail centre.

Business Day