The auction market continues to thrive online in these uncertain times, with auctioneers able to add auction dates with ease as demand dictates.
The two main commercial property auctioneers, Allsop and Acuitus, followed up their September successes with two further sales at the end of October and the beginning of November.
Between them, they racked up collective sales of £64.4m, with the sale of 93 properties out of a total of 115 offered and an average success rate of 81%.
This compares with their respective September sales where together they sold 109 lots out of 133 for a combined figure of £71.8m and a success rate of 82%.
Acuitus was first, on 28 October, and from its original catalogue of 38 lots, 10 were withdrawn prior, three sold prior and 21 sold within the live streamed auction.
It had seven lots priced in excess of £1m, of which one was withdrawn prior, two sold prior and three sold during the auction.
The highest-priced lot to sell live was Lot 19 in Luton, which was a remarkable result. Guided at £1.25m, it eventually sold after intense bidding for £2.87m.
Comprising a substantial building arranged as a vacant 60-room hotel on the corner of Stuart Street and Upper George Street, it also included two retail units with a total income of £47,500 pa and was being offered on behalf of receivers.
The second-largest property to sell live was the freehold of Northdown Industrial Park in St Peter’s in Broadstairs, Kent.
Comprising 12 industrial units and an office building, it was producing an overall income of £240,350 pa and sold for £2,840,000 – a gross return of 8.46%.
But the largest lot in the catalogue was a freehold building in D’Arblay Street, Soho, W1, which was guided at £4.5m to £5m. Producing a total income of £174,450 pa, it sold prior at a price believed to be in excess of the top guide – which at that price would have shown a gross return of just 3.48%.
Savvy investments
Allsop then followed on 3 November.
It offered 87 properties on the day from an original catalogue of 122 lots, but withdrew 35 lots prior.
It sold a total of 69 properties – 33 in the live sale, with 36 prior for a total of £41,795,150 (this has since crept up to more than £43m).
While it recorded a success rate of 79.3% on the day, eight of the lots were a broken-up parade of retail and residential units in Green Lane, Northwood, in north-west London, which were all sold prior and possibly all sold as a single lot, which if treated as such would have shown them selling 61 lots out of 79 offered or 77.2%. Its original catalogue included 17 properties with a guide price in excess of £1m, of which eight were withdrawn prior, two were sold prior and five sold in the live sale.
The highest-priced property and another remarkable result was Lot 27, Castle Hill House in Windsor (pictured), a freehold detached office building opposite Windsor Castle let to a limited company at a rent of £100,000 pa until March 2023. It was guided at £1.5m to £1.6m and sold after lengthy bidding for £2.63m at a gross return of 3.8%.
An old friend of mine which sold was Lot 33 in Buttermarket, in Bury St Edmunds. Let to Lloyds Bank plc until 2026 at a rent of £135,000 pa, it was guided at £1.4m to £1.5m and sold for £1,705,000, a gross return of 7.9%.
When I was at Cushman & Wakefield, we sold the property for £1,006,000 back in November 1996 as part of the Lloyds Bank sale and leaseback programme when the rent was £95,000 pa.
Now with a higher rental value, the property was then offered by Acuitus in April 2019, but it failed to sell at £1.89m.
But while we sold that property in very different times, the Allsop sale demonstrates what a good investment some of these bank investments have turned out to be.
However, clearly the demand still continues across the board for quality investments to offer better returns for investors than available elsewhere, and all auctioneers will now be working frantically to fill their books for the last round of sales in December.
John Townsend is head of auction advisory service at Harold Benjamin Solicitors
