Against a backdrop of ongoing uncertainty, the demand for income-producing assets remained resilient as private investors raised a total of £62 million at Allsop’s most recent commercial auction. There was particular appetite for sizeable mixed-use assets demonstrating that there is strong liquidity in the market where the pricing is right.
On the day, a total of 15 assets sold for upwards of £1 million, of which five were mixed-use. This included lot 83 (pictured), with the ground floor let on a new 10-year lease to Starbucks on Kentish Town Road, London, with four flats above, which sold at £2,500,000 million, reflecting a net initial yield of 5.7%.
The security offered by long-let assets continued to attract significant attention, with nine lots selling at better than 5% yields. Following a competitive round of bidding, lot 7, a bank let to HBOS in Rushey Green, Catford let at £38,500pa, sold for £790,000, reflecting a net initial yield of 4.6%.
The largest lot of the day was lot 103, St Davids Court, Wolverhampton, a 41,974 soft multi-let office building, benefitting from a spread of 11 tenancies and sold for £3,400,000, reflecting a net initial yield of 9.1%. This shows how investors are continuing to seek yield in the regions with a good spread of risk.
One of the most competitively fought-for lots on the day was lot 14, an attractive and well-positioned former NatWest bank in Northwood, which sold for £1,560,000, more than twice the original guide price and was bought by an owner occupier.
Finally, demand for high street retail assets is inconsistent, however five of the lots that were sold for more than £1 million were such investments. Lot 42 (pictured), the Roebuck Shopping Centre in Newcastle under Lyme was sold for almost twice the guide price, at £980,000 reflecting a gross yield in excess of 30%, as investors recognise the opportunities offered by these assets whilst they enjoy a strong initial return.
George Walker, Partner and Auctioneer at Allsop said: “Achieving a £62m sale with all the current uncertainty in capital markets and a total lack of leadership from Downing Street is very positive. Private investors remain keen to buy the longest let assets, mixed use and development opportunities as they have shown, but are exercising more discretion than ever in the retail sector.”
The full results can be viewed on the Allsop website. Allsop’s next commercial sale will be held on 9th July at The Berkeley, Wilton Place, Knightsbridge, London SW1X 7RL.
Notes to editor
About Allsop auctions
Allsop run the largest property auction departments in Europe through two highly experienced residential and commercial teams and is the UK’s number one auction house by transactions. We offer a wide range of lots covering residential vacant and investment properties, ground rents, land and development opportunities and secondary commercial lots. A minimum of six commercial and seven residential sales are held every year.
- Where a guide price (or range of prices) is given, that guide is the minimum price at which, or range of prices within which, the seller might be prepared to sell on the date at which the guide price, or range of prices, is published.
- The reserve price is the minimum price at which the property can be sold.
- Both the guide price and the reserve price may be subject to change up to and including the day of the auction.
Allsop is an independent property consultancy with a market-leading reputation for high quality service and integrity, covering the UK from our offices in the West End, the City, Leeds and Brighton. In addition to our position as the UK’s largest and most successful property auction house, we offer an extensive range of services for residential, commercial and mixed use property.
We have the people, the skills, the experience and the drive to maximise value for our clients in any given market and like to do business in our own distinctive Allsop style – open, friendly and honest. Clients appreciate this, which is why so many stay with us over the long term.
In an unpredictable world, Allsop remains a reassuringly constant source of market knowledge, insight and expertise.
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