The latest Commercial Property Auction Data (cPAD) Market Flash shows looks at the sector’s progress in 2019 and how it responded to the continued political and economic conditions.
Sales in the UK commercial property auction market as measured by MSCI totalled £550m in 2019. This represented a year-on-year reduction in volume of 23% but this was considerably smaller than the drop in sales activity in some private treaty markets which saw falls of around 60% during the same period.
Acuitus auctioneer, Richard Auterac, comments: “In 2019, owners remained reluctant to sell assets that offered high initial yields and this was a contributory factor in reducing the volume of transactions during the year. It also meant that, as many of these higher yielding assets were not traded, transactional yields remained largely unchanged although there were some interesting subtle shifts. In times of uncertainty, investors naturally gravitate to longer lease lengths and more security of income.
“However, it is interesting to note that the average yield commanded by assets with lease lengths of less than five years sharpened by 76bps year-on-year.”
To download the latest cPAD Market Flash, please click here