Retail warehouse values bounce back
Published: 20 December, 2010
Out-of-town capital values rise 23 per cent in a year
The latest IPD monthly indices that show retail warehousing was one of the strongest performing subsectors in the UK commercial property market with an average annual total return for the last 12 months of 32.16 per cent. This compares to a total return figure of -30 per cent in this sector during 2009.
According to Savills' research the main driver behind this recovery in returns has been a significant recorrection in capital values with average capital values growing by 23.6 per cent over the year. Jaime Dunster, investment director at Savills, said: “As a result of increased investor appetite and a lack of supply, we have witnessed a further hardening in average retail warehouse initial yields this year by a further 50bps, which is in addition to the 100bps hardening that occurred last year.”
