Retail, from High Street to the Convenience sector
comprises 68% of the value of sales, from 71% last year. The biggest change was in offices from 4% to 12.3% as buyers seek the higher yields and perhaps diversified risk in that sector.
There has been a drop in Leisure assets perhaps reflecting the dramatic shift in fortunes of even the biggest operators and we are yet to really prove what our buyers would pay for industrial assets. There is tremendous untapped demand for industrial from our buyers, but our market sees very little stock.
Alternatives, in Car Parks, Motor Trade, Medical and other miscellaneous sectors has grown from £27m to £31m this year. This is a trend that we can see continuing as cash is weighing heavily on the books and buyers will look at most investment assets that they understand.
The national spread of auction sales continues
to cover the country as the miles covered by
the team will testify.
This year the proportion of lots sold in London and the South East has held steady at a little over 50%, with some changes in regional markets. The South West, North East and West Midlands have seen the biggest gains in the ever changing flow of assets coming to market and we continue to attract stock and buyers in Scotland and Wales in line with previous years.
It is rare to see all four graphs falling together as average yields tightened in July compared to May, which goes against market sentiment. This trend reflects the narrowing of the band of “Grade A” stock and secondary properties become wider, particularly on the High Street.
This trend is reflected in our buyers survey which shows vigorous demand from buyers, who are keen to invest their cash in correctly priced properties and a shortage of stock.
This continuing shift has also been assisted by a tightening of yields paid for the very best, longest let assets to a little below 4%, reflecting a shift to quality for investors with a very long term view, cash to invest and perhaps an eye on enhancing their real estate over time.
Meanwhile the average retail yield, for all retail stock sold in the period has tightened a little, reflecting the long term average of 8% over the last 12 months.
“This continuing shift has been assisted by a tightening of yields paid for the very best, longest let assets to a little below 4%, reflecting a shift to quality for investors”