UK High Streets: the great unknown for private investors

9th December 2020

Acuitus Chairman, Richard Auterac, features in a new EG podcast which looks at what opportunities UK High Streets offer private investors.

Joined by James Child, EG’s Head of Retail & Industrial research: Anthony Ratcliffe of Ratcliffes; and Vijay Parikh of Benjamins solicitors, Richard gave his views on where the pandemic had left High Streets investments.

Citing examples of High Street lots around London which have sold at recent Acuitus auctions for yields of sub-5% yields to 6.5%, he commented: “I would doubt that we would have got any better price in any different market. Crucially, each of these lots had residential on the upper level or the potential to add residential.

“These offer investors exposure to bricks and mortar with the least risk and in manageable lot sizes.”

However, uncertainty about the future trajectory of rents and occupiers is making pricing difficult even in the type of affluent market towns and historic cities which had previously provided core assets for the private investor.

He commented: “When you start looking at a price an asset should command one could say ‘Well, the yield I want on that investment is 6% because that’s a good return above gilt yields and reflects the perceived risks but on what income?’ Again, it’s the unknown unknowns.

“What will happen when that lease expires in two years’ time? It is this uncertainty that pushes the prices lower but for the well advised investor this is the opportunity that drives superior returns in the future”

You can listen to the full podcast here