In annual results, the firm revealed it had enjoyed six years of returns at 10% on property investments but last year this dropped to just 0.3% as London stagnated.

It is now focused on continuing a programme of strategic sales started early last year to recycle capital in readiness for new market opportunities and to fund its development pipeline.

The property group said it had sold off more than £500m of UK assets in the past year, and that the vote to leave the EU last June had especially hurt London residential property.

The 340-year-old landlord owns swathes of Mayfair and Belgravia and owns £6.5bn in property around the world.

Grosvenor is now pushing into mid-market housing, including an ambitious plan to create and manage a new urban neighbourhood in London’s Bermondsey district, just south of the river.

Planning proposals will be submitted later this year for a five hectare scheme that will include about 1,500 homes, mainly for rent, alongside a new secondary school.

Architect Kohn Pedersen Fox is on board for the area’s masterplan and Cottrell & Vermeulen Architecture for school design.

Mark Preston, chief executive of Grosvenor Group, said: “Investor and occupier unease before and after the UK’s EU referendum, and the imposition of higher stamp duty on purchases, greatly contributed to a slowdown in the London residential market which we anticipated and planned for.

“Looking ahead, we expect our returns in 2017 to be significantly weaker due to limited room for market value appreciation and a reduction in revenue profit following some well-timed disposals.

“The proceeds of these sales will be re-invested into our £6bn pipeline of projects to be delivered in several years’ time, resulting in a recovery in returns.”

Preston added that the Barton Park joint venture with Oxford City Council to create a 26-hectare garden suburb of nearly 900 homes and the Trumpington Meadows 24-hectare, 1,200 homes neighbourhood development in Cambridge remained on track.