Stanhope and Christian Candy’s CPC Group are in a two-horse race to develop the £1bn Noho Square residential scheme in central London

It is understood that representatives from both groups flew out to Reykjavik last month to pitch to the board of Icelandic bank Kaupthing, which took ownership of the project last October.

CPC Group has made it to the last stage of the bidding even though the Candy brothers pulled out of the project last year.

The final two have been whittled down from an original shortlist of six. It is understood that this list was then increased to 10 and that the deadline for bids was extended from 28 November to mid-December.

CPC swapped its equity stake in the scheme with Kaupthing, its joint venture partner last year. In exchange, CPC took full ownership of a £330m project in Beverly Hills.

The swap meant that the Candys’ development arm, Candy & Candy, would no longer automatically be development manager on the Fitzrovia scheme, which also includes office space.

A spokesperson for Stanhope confirmed that it was up against CPC for the role.

Candy & Candy declined to comment.