Wednesday, June 1, 2011

News: Eastwood unit sale shows life in market


A private investor has purchased a unit on the Eastwood Trading Estate in Rotherham for £250,000.

The investment deal at Unit 1 Shaw Road was overseen by Kinght Frank and reflects a net initial yield of approximately 7% based on the current annual passing rent of £18,000 and a capital value of £52 per sq ft.

The property is let until 2017 to Plumb Center, the UK's leading supplier of heating and plumbing products.

Knight Frank has also overseen a recent deal at a multi-let estate near Chesterfield and commercial property experts say that the recent deals support investor confidence in a sector which has continued to see healthy take-up of good quality small to medium-sized stock in traditional industrial locations.

Andrew Harrison, investment surveyor at Knight Frank, said: "Our recent LOGIC and Sheffield Market Activity reports concluded that there is "life" in the local investment market and these two deals are good signs of that in 2011.

"The majority of investment transactions in the region are driven by property companies, and private investors who are keen to acquire similar stock to the Rotherham and Chesterfield deals. This has ensured that demand for prime and good quality secondary property remains resilient particularly for multi-let industrial estates.

"We have transacted three estates in the last six months with two more currently under offer - one obtaining eight offers at, or better than, the asking price.

"However, poorer quality secondary and tertiary stock is still a challenge to sell. For stock of this nature, active asset management is needed to improve the attractiveness of the property and we are constantly providing advice to clients looking to create a saleable proposition over the next few years.

"Considering the current stage in the market cycle, investors undertaking thorough pre-bid due diligence on crucial issues like location, build quality, covenant and rental values are likely to see their homework pay dividends over the long term."

Knight Frank website


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