The first Acuitus auction of 2016 saw concerted investor buying of assets from all commercial property sectors as the sale raised £56.38m and 98% of the lots offered sold.
Of the 71 lots in the sale, 57 sold in the room and 12 prior at an overall average price of £817,000.
Acuitus auctioneer, Richard Auterac, commented: “We have been talking since last summer about the growing latent investor demand in the auction room and this was a tremendous illustration of that.
“We have been working painstakingly with sellers and their professional advisers to bring the right assets to the market at the right prices and this shows what can be achieved when this is done. As equity and bond markets remain volatile, investors have sent out a strong message about the attraction of property.
“Many of the lots offered today were not ‘dry’ investments – they will require active asset management to drive income and value. However, buyers are now backing their ability to do this in an environment where rents have re-based and there is increasing wage growth and consumer spending.”
The top price of in the auction was achieved by Castlegate House in Sheffield – a 99,275 sq ft city centre retail investment let to BHS Properties until 2065 and Frozen Value until 2023. Offered with a guide price of £2.75m, it eventually sold for £3.345m after sustained bidding.
The continued popularity of pub investments was shown by the sale of the Becketts Bank Wetherspoons in Park Row, Leeds. Let until 2040 at a current rent of £165,000pax, it sold for £2.85m at a yield of 5.6%.
Properties which offered some development potential also attracted strong bidding. At 10-12 St Ann’s Road in Harrow, two prime freehold retail units (one with vacant possession) and two residential flats plus a vacant first floor
with residential planning consent and producing current income of £46,314pax sold for £1.86m at a yield of 3.09%.
Richard Auterac commented: “The exceptional success rate at this sale and the evidence of investor buying across the board do not mean that it will be all plain sailing for sellers from here on. Bringing properties to market still requires comprehensive market reach, the ability to fully understand what investors are looking for and a professional forensic approach to assembling relevant information for the benefit of the bidders’ due diligence.
“However, this is the first auction of the year to really show the momentum that the auction room can achieve as investors clamour for property assets.”
Other lots sold in the auction included:
The second Acuitus auction of 2016 will take place on March 23rd at the Radisson Blu Portman Hotel, Portman Square, London W1.
