July auction raises £18.8m

11th July 2012

A quarter of the lots at Acuitus’s July auction sold for more than £1m as investors once again demonstrated a strong preference for properties let on long leases to good covenants. The sale raised a total of £18.815m at a success rate of 58%.

Acuitus auctioneer Richard Auterac commented: “It was interesting to once again see the diversity of investors in the market. Overseas buyers continue to proliferate in London but this auction demonstrated that there are also local hot spots of private equity outside London where investors are actively acquiring.

“While there is a strong preference for properties let on long leases to good covenants, there are also investors who are prepared to take on properties that do not fit this profile. In these instances, asset management expertise and a defined strategy are essential.

The demand for robust investments was illustrated by the sale of 67 High Road in London’s Wood Green. Let to Santander until 2037 at a current rent of £66,000pax, it sold for £1.185m at a yield of 5.2%. In York, 4 Davygate – a 5,312-sq ft freehold bank investment – which is let to Bank of Scotland until 2025 at a current rent of £183,000pax – sold for £2.6m at a yield of 6.6%.

Elsewhere in the sale, two LA Fitness Centres in Leeds and Guildford sold for £1.2m and £690,000 respectively while 5 Sandwich Street – a residential development in London’s Bloomsbury – sold for £1.51m reflecting a capital value of around £700 per sq ft.


Richard Auterac commented: “At the other end of the scale, investors – who are usually local to the properties in question – were prepared to buy even if there was only a short-term income profile. This is because they have an appreciation of the intrinsic worth of the properties in question and can see long term capital growth from current pricing levels”.

Pelham Court – a campus of 14 self-contained office units near Crawley – currently produces annual income of £225,061pax with an average unexpired lease profile of around three years. It sold after strong bidding for £1.17m.

Other sales in the room included:

  • 12 Bridewell Place, London EC4: a 2,004-sq ft retail investment let to Costa Ltd and currently producing £66,000pa sold for £980,000 at a yield of 6.3%
  • 15-16 High Street, Taunton: a 22,553 sq ft freehold geared ground rent retail/leisure investment let to Eldridge Pope on assignment from Tesco Stores and Primark at a current rent of £115,200pax sold for £1.7m at a yield of 6.4%
  • 38-40 Court Road, Brockworth: a 1,598 sq ft freehold shop let to Sue Ryder on a new 10-year lease at a current rent of £16,850pax sold for £255,000 at a yield of 6.2%.
  • 91 High Street, Sutton: a 2,000 sq ft reversionary freehold shop investment sublet to Telefonica UK at a current rent of £35,131pax sold for £580,000 at a yield of 5.73%
  • 139-157 St James Road, Northampton: a 14,572 sq ft  freehold retail investment comprising two units let to Asda Stores and Vets4Pets sold for £1.48m

Acuitus is now taking sale instructions for its fifth auction of the year which will take place on October 18th at the Millennium Hotel, London W1.