After a quiet summer for the private treaty market, Allsop defied even its own expectations by selling more than £105m of property in its September commercial sale.
Cash buyers snapped up 129 lots from 162 offered – an 80% success rate – in the 21 September online auction.
Partner and auctioneer George Walker said there was “no doubt” that pricing had softened. Sixty-five lots were withdrawn prior as some sellers decided against selling into such a difficult market.
However, successes included 26 lots selling at yields below 5%. Walker said: “With interest rates rising, you wouldn’t have expected to see that.”
These included several lots from a portfolio of veterinary surgeries in London and the South East let to pet care business Medivet, which is owned by CVC Capital Partners. The portfolio, which includes some residential, is understood to have been offered for sale by the original founders of the business, who had retained the properties when they sold to Medivet.
The keenest yields were paid for branches in Stanmore and Harrow in Middlesex and Finchley in north London, N3. The average yield across the 14 lots to sell from the portfolio was 4.7%. “In a market that is supposed to be falling, that’s a very strong price,” Walker said.
The largest lot to sell under the hammer offered further proof of the market’s appetite for alternative sectors. This was a freehold gym investment, operated by Pure Gym, in Leeds, West Yorkshire, which sold for £3.4m, a net yield of 7.62% (lot 28).
Another of the larger assets to sell was an office building suited to residential redevelopment in Clapham, SW4, which made £2.9m, a 5% yield (lot 10). The lease to occupier Matrix APA, a beauty and lifestyle company, expires next year.
High street Boots stores continued to appeal to investors. “Retail has bottomed out and is on the way up,” said Walker, “but people are uncertain about the office market. Occupier trends have not really settled down since Covid.”
A 7,000 sq ft freehold office let to Virgin Media in Telford, Shropshire, remains available at £959,000. The guide reflects a 7.3% yield (lot 91).
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