Strong October for Allsop and Acuitus

Duncan Moir, Allsop’s commercial auctioneer, must have been feeling confident when he parked his E-Type Jaguar in the front driveway of the Berkeley Hotel at its two-day sale last week. And for good reason. Total sales amounted to £147.1m, with 214 of the 276 properties that were offered sold – a 77% success rate. [caption id="attachment_846105" align="alignright" width="150"] John Townsend, head of auction advisory service Harold Benjamin[/caption] It was Allsop’s biggest sale since October 2006. A total of 39 lots sold for more than £1m, with 33 under the hammer, five sold before the sale and one after. While the average lot size overall was just above £687,500, the biggest lot selling under the hammer was the £7.3m raised for Lot 105 in South Street, Bishop’s Stortford. Let to Marks & Spencer for a term expiring in 2027 without break, it produces a rent of £394,996 pa with annual fixed rent increases until 2026, when the rent would be £469,978 pa and showed an initial gross return to the buyer of 5.4%, rising to 6.4%. The private investor then went on to be the underbidder on Lot 107 in Dorchester, which sold for £3m. Offered by Aviva Investors, this freehold shop investment was let to Peacocks Stores until 2041, again without break, at a rent of £150,000 pa and showed a gross return of 4.8%. It is believed the Bishop’s Stortford property had previously been offered on the private treaty market without success and auction was clearly the way forward to secure the right result and to access the private investor market at this price level. The next biggest lot was offered on the second day, in Bearwood Road, Smethwick, West Midlands (Lot 201), which sold for £4.5m. A freehold mixed-use parade offered on behalf of the receivers at CBRE, it comprised 21 shops with upper floors and produced a total income of £259,270 pa with five shops, two maisonettes and offices which are currently vacant and showed a gross return of 5.8% on the passing rent. The most intense bidding, though, was for Lot 96, a petrol station in Finchley Road, Golders Green, NW11, on a 0.4-acre site which sold for £3.3m from a guide of £2.2m. It was let to Co-Operative Foodstores and guaranteed by Co-Operative Group (and trading as a Texaco Garage) until 2027 without break at a rent of £101,177 pa rising annually to £123,334 pa by June 2027. The investment showed a gross return of 3.06%, rising to 3.73%. The garage was situated in a prominent location on the corner of Finchley Road and Addison Way, about 100m from the North Circular Road (A406). The next day, Acuitus was back in action. Total sale proceeds amounted to £64.07m from the sale of 74 lots out of 91 offered, a success rate of 82%. The average lot size was £866,000, with more than 21 lots selling with a price tag in excess of £1m. Highest price of the day was the £3.3m realised for Lot 10 in Hills Road and Station Road, Cambridge. A substantial and unbroken long leasehold retail and residential investment comprising five shops, a restaurant, a nightclub and six residential units at a total net rent of £181,343 pa, it showed a gross return of 5.49%. Close on its heels was the £3m realised for a freehold convenience store, office and residential investment in High Street, Cobham, Surrey (Lot 11). Guided at £2.5m, the major part was let to Mackays Stores until 2025 at a rent of £87,500 pa but sublet to Sainsbury’s at £159,900 pa. The first-floor offices were let to an individual at £36,185 pa, meaning the total rent passing was £123,685 pa with a gross initial return to the purchaser of 4.12%. Almost £3m was realised for Lot 20 in Bury St Edmunds, a prime freehold retail investment in Cornhill. Entirely let to WH Smith Retail Holdings until 2032 (but with a break in 2027), it was let at £160,750 pa and showed a gross return of 5.36%. Lot 6 in High Street, Barnet, EN4, was also hotly contested, selling for £2.6m from a guide price of £2.1m. A freehold and convenience store investment, the major part was let to Sainsbury’s until 2022 at £92,500 pa, with three ASTs and further income making the total rent roll £135,730 pa – a gross yield of 5.14%. There were two lots that surprisingly didn’t sell on the day. The first was a freehold retail and restaurant investment in High Street, Oxford, a location that rarely comes to the market. The ground floor was let to Reiss until 2019 at £83,500 pa and a restaurant added to the overall income of £132,500 pa, which at the bottom end of the £2.3m guide would have shown a gross return of 5.76%. The second was Lot 17 in the Parade in Royal Leamington Spa, which comprised three prime shops let to Joules, Specsavers and Charnley’s Opticians at a total income of £193,500 pa which at the guide of £2.9m would have shown a gross return of 6.67%. I’m sure they won’t remain available for long. Despite these ongoing fears of interest rate rises and further stock market volatility, the commercial auction continues to thrive and the market will be eagerly awaiting December catalogues from Allsop and Acuitus. John Townsend, head of auction advisory service Harold Benjamin