Supermarket investment up 20% year-on-year

Property transactions in the UK supermarket sector increased by 20% year-on-year in the first half of 2017 to reach £727m, according to data from Colliers International.

H1 2016 saw £603m transacted, including the sale of the £230m Phoenix portfolio which skewed the numbers for this period.

The average net initial yield of properties sold in the first six months of 2017 was 5.05%.

James Watson, head of retail capital markets at Colliers International, said: “Despite subdued retail investment activity generally, the food store market has recovered a large amount of ground and is proving increasingly popular with investors. Confidence has returned to the sector; retailers are beginning to take new stores again and we expect transactional volumes to be well ahead of last year.

“There is still no sign of rental growth outside London, but we are starting to see some signs of stability in the occupational markets. Average lot sizes are lower and institutions in particular are acting with caution and being selective on income and assets. However, we anticipate more institutional activity in H2, with some larger lot sizes changing hands although lack of prime stock will continue to be an issue.”

Related Articles

Have your say

Sign in to make a comment on this story.

Sign In

Text size

Desktop Site | Mobile Site