Healey & Baker recorded the highest price on a single lot in any auction so far this year with £2.2m for a 34,510-sq ft retail warehouse in Kettering, Northamptonshire.
A private property company snapped up the long-leasehold investment, which was originally part of a portfolio sale of retail warehouses by AMP Asset Management on the private treaty market.
Allied Dunbar bought the six-unit portfolio off an 8.1% yield (see “News”), but balked at the Kettering investment because it lies on contaminated land.
The property – let to B&Q and Comet at £198,450 pa – ended up in the H&B auction room, successfully selling off a yield of 8.8%.
“The funds tend to shy away from contaminated land,” said H&B auctioneer Tim Weale. “The property companies see it differently.”
The 8.8% yield on the Kettering investment reflected the problems on site, according to Weale. He added: “It would have been at least 1% off that figure if the site had been clean, probably more than that.”
Even so, Kettering accounted for more than half the revenue from H&B’s sale last week, when Weale achieved a 69% success rate by selling 13 of the 19 lots offered under the hammer.
Key properties included the freehold shop investment let to F W Household Supplies at £34,000 pa on High Road, Loughton, Essex, which sold for £290,000.
Two new leasehold shop investments in Stoke Newington, N16 – occupied by Pizza Hut and Ladbrokes – sold for £164,000 and £198,000, showing respective yields of 8.9% and 8.96%.
The shop at 42 Sheen Lane, Mortlake, SW14, achieved the lowest yield of the day – 7.3%. Ind Coope, trading as Augustus Barnett, occupies the property, which realised £320,000.
Weale said that there is unlikely to be any major movement in yields in the immediate future, adding: “I detect that the market may be taking a breath after intense bidding at the end of last year. Against a background of an uncertain stock market and interest rates, I think that the buyers are naturally being cautious.”
