Grosvenor Group has offloaded hundreds of millions of pounds worth of high-end London property amid concerns that the city's prime market has peaked.

The firm, owned by the Duke of Westminster, owns large amounts of property in the Mayfair and Belgravia areas of central London. It also manages £5.8bn worth of property across the world.

But it has sold £240m of its portfolio in these two prime central London areas and is now targeting rental property in outer boroughs where there is higher demand.

Mark Preston, chief executive of Grosvenor, said he is more worried about the price of prime London property now than he was in the past.

"We have been concerned about the level of property values in some markets, particularly in prime central London residential property," he said in the firm's 2013 annual report, adding that Grosvenor is "exploring the mid-market, where there is unsatisfied demand for good quality rental housing".

Grosvenor said it had reinvested some of the money drawn out of prime London into an affordable housing development in Bermondsey.

Estate agency Knight Frank has pointed out that super-prime London markets are seeing property price growth slowdown. But outer areas such as Islington and Wandsworth are reporting significant house price growth as investors chase greater returns outside of the prime areas.

Demand is intense and the supply is weak, which has helped drive up London house prices and rents.

The Office for National Statistics (ONS) said the average price of a London home hit £458,000 in February 2014, an 18.2% leap over the year.

Grosvenor's are not the first concerns from property investors that a bubble has formed in the prime London market.

Noted property developer Nick Candy, one of the men behind One Hyde Park, the most expensive block of flats in the world, has said he does not think there is enough demand to justify the supply of new properties in areas such as Mayfair and Belgravia, where a number of building projects are underway.