Retail property sales up 90 per cent
Published: 20 October, 2010
Direct investment in retail real estate in Europe during the first three quarters of 2010 rose by 90 per cent, according to Jones Lang LaSalle
JLL calculates that €15.2bn of retail property changed hands across Europe during the first three quarters of 2010, with €5.0bn of sales in the third quarter alone.
The UK, Germany and Poland together accounted for 80 per cent of total investment in the third quarter and the UK led the way, partly due to a €1.15bn sale and leaseback deal by Tesco.
Otherwise the UK has maintained consistency throughout the year, with approximately €1.4bn traded each quarter. Seven shopping centres traded in Q3 in the UK, notably the tford Centre in London sold by Land Securities to Catalyst European Property Fund for just over €100m.
David Raven, Head of UK shopping centre investment at Jones Lang LaSalle, said: “The vast majority of stock in the UK shopping centre market that has traded in 2010 is inferior in quality to 2009 which was characterised by a high volume of prime transactions. The fact that the relatively inferior quality stock has traded is further evidence of buyer sentiment improving. This theme is set to continue in the short term as the supply of prime stock coming to market is limited which should suggest prime yields will remain at their current levels or even harden.”
Raven continued: “Leveraged investors and particularly the raised opportunity funds have become more prevalent throughout the year and are likely to dominate buying activity in the final quarter of 2010 and into 2011 as long as they are able to secure debt from the lending banks. This buyer type will be of key importance for the vast majority of secondary stock which is anticipated to come to the market.”
