The final Acuitus commercial property auction of the year saw £41.125m of assets sold, and brought 2016 sales to £354m – the firm’s highest-ever total.
The volume of properties which have sold at Acuitus auctions is up 23% year-on-year.
Acuitus auctioneer, Richard Auterac, commented: “The commercial property auction sector has had a very strong year in the face of almost unprecedented geo-political and economic uncertainty. A growing number of investors have turned to the auction room to access tangible assets with the income profiles which suit their investment requirements.
“As the year has progressed, buying criteria have broadened with investors prepared to look at wider asset types offering a range of income profiles, geographic locations and active management requirements. Our auctions offered all these buying opportunities.
“Property savvy high net-worth investors see a strong investment case for diversifying out of cash and bonds to provide long-term income for SIPPS, trusts and other investment and pension vehicles. The evidence is clear; there has been no reduction in prices in the commercial auction room in 2016 for assets that fit these criteria.”
Typical of the type of lots that investors homed in on at the December auction was a 3,277 sq ft Barclays Bank on Godalming High Street in Surrey. Let until 2026 – with an option to break in 2021 – at a current annual rent of £57,600, it sold for £1.23m at a yield of 4.4%. This is a higher price than was achieved at the height of the last cycle.
A 2,094 sq ft retail investment at 242 Kentish Town Road NW5 sold for £1.74m at a yield of 4.7%. With a ground floor shop let to Foxtons on a 15-year lease from 2015 and with an option to break in 2025, the investment currently produces income of £87,650.
Two modern office building in Leeds and Hook sold separately prior to auction to two high net-worth property investors for an aggregate price of £7.75m.
Richard Auterac comments: “Post-recession re-based rents, realistic pricing and lot sizes which align with the ‘sweet spot’ for many private investors have given commercial property auctions momentum heading towards the new year. However, the common denominator among assets that sell well has been the depth of information provided by the sellers.
“This is something as an auction house we have always majored on and it is apparent that there is a correlation between the depth of information provided about a lot from the outset, and its successful sale. The sector is growing in sophistication and we must continue to respond to this.”
Other notable sales in the auction included:
The first Acuitus auction of 2017 will take place on February 16th at the Radisson Blu Portman Hotel, 22 Portman Square, London W1H 7BG
