The first Acuitus commercial property auction of the year saw £35m of assets sold, with the keenest interest being shown in properties producing long-term income or those located in London.
The average lot sale price was around £970,000 with nearly a third of properties selling for more than £1m.
The highest price in the room was achieved on a 21,448 sq ft supermarket in Wimborne, Dorset, let to the Co-op until 2034. It sold for £4.8m which reflected a net initial yield of 5.8%.
Acuitus auctioneer, Richard Auterac, commented: “If there was any doubt about the interest for investing in good quality commercial real estate this was dispelled by the number of high net worth investors in what was a very full room. There was no shortage of funds to invest, with the lots in the £1m – £5m range proving the most popular. Lively bidding meant several of the lots were bought at strong prices”.
The interest generated by London locations was evident early on in the sale with the second lot of the day, a restaurant at 244 Kentish Town Road, London, NW5, selling for £985,000 at a yield of 3.8%.
Properties with development or improvement potential remain popular and another London lot, 8-12 Lee High Road, Lewisham, comprising three retail units with a dental surgery above, and with scope there for residential conversion, sold for £2.2m at a yield of 4.4%.
The sale of 101-105 High Road, Ilford, Greater London demonstrated the interest in long-term income. The 5,287 sq ft property, which is let to The Co-operative Bank until 2062 realised £2.92m – a yield of 4.7%.
Despite the successful sales, Richard Auterac commented: “Pricing is not a one way ticket. While there is demand for all types of investment, sellers’ expectations need to be tempered for investments where the future income is more uncertain and this needs to be reflected in the pricing”.
Richard Auterac also commented: “I was impressed by the atmosphere in the room and it is clearly evident that buyers have a serious wish to invest. It seems to us that the great majority of high net worth investors do not have access to these types of good quality investments except through our auctions. There were some big hitters there along with large-scale residential investors making their first commercial purchases.”
Other notable sales in the auction included:
The second Acuitus auction of 2017 will take place on March 30th at the Radisson Blu Portman Hotel, 22 Portman Square, London W1H 7BG
