The sixth and final Acuitus auction of the year raised £16.6m and concluded a successful year during which the firm has sold in excess of £180m of assets.
Reflecting on sales volumes that were 15% up on 2012, Acuitus auctioneer, Richard Auterac, commented: “This has been a year which has seen more momentum in the commercial property auction sector.
“Investors have an eye on the brightening economic outlook while the distressed property situations which date from the pre-crash boom are now being gradually addressed. This is bringing more stock into the auction room and creating a more fully functioning market than we have seen for some considerable time.”
The December sale once again illustrated that investors remain very selective but will buy in any sector if the investment characteristics are right or if the price presents scope for achieving a proper return following asset management.
A freehold retail and residential investment in London’s Shepherd’s Bush which currently produces £59,350pa sold for £1.255m at a net initial yield of 4.4%.
Other lots which attracted concerted bidding included a 3,357 sq ft Pizza Hut investment on the Lombardy Retail Park in Hayes. Currently producing £91,000pa and let to the operator until 2024, the property sold for £1.28m at a yield of 6.7% while a 1,056 sq ft retail, leisure and residential investment in North End Road sold for £1.015m at a yield of 6%.
Among the lots which offered potential for redevelopment or active management, a former community hall in London’s East End sold for £1.45m. The 11,787 sq ft Barclay Hall in Green Street has potential for conversion to residential.
Investors remain keen on food-related assets and there was competitive bidding for the Cowshed restaurant in Whiteladies Road, Bristol. Let to Enterprise Inns until 2025 at a current annual rent of £50,000, the 3,412 sq ft property sold for £680,000 at yield of 6.9%.
Richard Auterac commented: “We are now looking forward to our six sales in 2014 with confidence. There are more buyers in the room and more finance available.
“Our average lot sale price this year has been around £800,000 and illustrates the substantial nature of the assets attracted to the auctions. The fundamentals for buying next year will remain the same and it will continue to be a market more for experienced investors.
“Auctions are attractive to investors looking at an investment medium which provides higher and more stable income returns and future capital growth than low-yielding bonds and volatile equities. The sector also offers opportunities to secure properties which through active management can show performance in the improving economic and financial landscape.
“The auction room will continue to be a preferred medium for bringing distressed assets to market but we are now also seeing an increased number of retailers carrying out sale-and-leasebacks to fund future expansion and this is a positive sign of increased economic growth.”
Other sales at the auction included:
Acuitus is now taking sale instructions for its first auction of 2014 which will take place on February 13th at the Millennium Hotel, London W1.
