A stunned silence greeted the sale of the star lot at Nelson Bakewell’s £22m London auction last week, according to auctioneer James Cannon.
Having been guided initially at £400,000 to £425,000, a supermarket investment in Warren Street, Stockport, let to Sainsbury’s for a further 133 years was eventually knocked down for £705,000 – a net initial yield of 3.37%.
“Because of the level of interest, the guide was moved up and the reserve was set at around £500,000 on the day,” explained Cannon. While the bidding faltered at about £560,000, “the sheer level of the interest just kept it going”. However, the fact that the bid increment fell to only £1,000 reflected an element of caution in the room.
“People are there to buy still, but there was not quite the frenzied activity of last time,” he admitted.
“Medium- to long-term money has been fluctuating somewhat and with Italy saying it may be leaving the ERM, people are realising that it is not definitely a ski slope down to interest rates of 2.5% and are being a little more cautious.”
The sale brings Nelson Bakewell’s total sales to more than £120m since last October.
