Strong bids as auction buyers eye safe havens
Results from the latest commercial and residential auctions have left industry figures hopeful that UK real estate will prove to be a “safe haven” during a period of volatility in other markets.
Allsop’s latest residential auction, its fourth of the year, brought in £28m with a success rate of 76%. That brought the total raised so far this year by the agency to £140m. The highest-value lot sold was a freehold house in multiple occupation in Coventry which was acquired for almost £2.3m.
Other freehold lots included: an HMO building with 35 en-suite bedrooms in Coventry, sold for £2.25m; a semi-detached four-flat building in Kensington, W8, sold for £2.1m; a block of 20 student flats in Leicester, sold for £1.74m; and end-of-terrace building comprising a retail unit and three flats in Acton, sold for £905,000.
Results from the latest commercial and residential auctions have left industry figures hopeful that UK real estate will prove to be a “safe haven” during a period of volatility in other markets.
Allsop’s latest residential auction, its fourth of the year, brought in £28m with a success rate of 76%. That brought the total raised so far this year by the agency to £140m. The highest-value lot sold was a freehold house in multiple occupation in Coventry which was acquired for almost £2.3m.
Other freehold lots included: an HMO building with 35 en-suite bedrooms in Coventry, sold for £2.25m; a semi-detached four-flat building in Kensington, W8, sold for £2.1m; a block of 20 student flats in Leicester, sold for £1.74m; and end-of-terrace building comprising a retail unit and three flats in Acton, sold for £905,000.
Richard Adamson, managing partner and residential auctioneer at Allsop, said: “During an economic and political climate which seems to be in a prolonged state of unpredictable uncertainty, it is no surprise that some investors are a little more cautious than they have been for a while. Despite this, our result shows that there is still strong demand for well-priced income-producing assets and suitable value-add opportunities.
“The volatility we have witnessed in the stock market recently has seen some investors turning to the safe haven of UK real estate, which is a trend we have seen over the past few years. We look forward to witnessing continued investor appetite at our next auction, which takes place over two days next month.”
Sustained interest
Earlier in the month, Savills’ first April auction raised more than £43m across an online live-streamed session. The sale saw 146 commercial, mixed-use and residential lots on the rostrum, achieving a success rate of 70%.
A building in Crouch End, N8, comprising four one-bedroom flats sold for £1.9m, while in Norwich, a detached co-living investment with 26 en-suite rooms sold for almost £1.8m.
In East Dulwich, SE22, a semi-detached property arranged as three self-contained flats sold for £1.32m.
Commercial investments included a building in Stratford, E15, let to Newham Primary Care NHS Trust, sold prior to the auction for more than £1.9m.
Savills Auctions’ Steven Morish said: “We continue to see appetite for properties at auction, despite recent economic turmoil. While the strongest demand was felt most keenly at the low to mid-end of the residential market, we continued to see some strong bidding on well-priced properties in prime UK towns, with many lots achieving in excess of their guide price. Not only does this reflect that buyers are still eager place their confidence in bricks and mortar, it also highlights sustained interest in the certainty that auctions provide.”
Savills’ George Goucher added: “It’s clear to see from our latest auction that commercial investors are still keen to transact. While there was some hesitancy among bidders, we saw good levels of demand for income-producing assets backed by strong tenant covenants and opportunities that offer longer-term security and growth.”
As Estates Gazette went to press, the firm was preparing to hold an auction with larger commercial lots, including a former pub in Camden, NW1, for £3.25m and a mixed-use investment opportunity in north-east London for £3.65m.
A diverse appetite
At Acuitus’s latest auction, a mixed-use residential and retail investment in Enfield, EN1, sold for £2.4m at a yield of 7.04%, while a retail parade in the Welsh town of Barry sold for £2.43m at a yield of 14.45%. The firm’s David Margolis said: “Given that these assets sold for almost the same price, they illustrate the current diversity of investor appetite.
“This is a positive signal for sellers and demonstrates our ability to price and successfully bring to market properties with very different characteristics in very different locations.”
Other assets were sold just before the auction, with a restaurant investment in Royal Tunbridge Wells occupied by Wagamama on a lease until 2038 and a supermarket investment in Newmarket let to Tesco Express until 2034, fetching a combined total of more than £2.5m.
Acuitus’s Jon Skerry said: “These two assets benefited from strong covenants backed by household brand names, and their sale shows the continued focus of many investors on security of income.”
Acuitus sold £40m of assets at an average sale success rate of 84% across the start of the year. Chairman Richard Auterac said: “As the commercial property market continues to reshape itself in the face of a changing economic environment, our first auctions of 2025 have shown how we can connect buyers and sellers to achieve pricing which reflects a deep understanding of asset types and the demand for them.
“There is a substantial amount of capital looking to target the UK commercial property market. Its deployment will be encouraged by a combination of clear transaction data from our auctions and hopefully a more settled economic environment.”
Image © Savills
