CoStar Finance reports that there’s roughly GBP 2.7bn of commercial property currently on sale in the UK via ongoing portfolio deals. Most of the vendors have targeted the end of the year for the sale of the assets, a trend CoStar chalks up to an eagerness to cash in on a desire by investors to put capital into play. Despite a range of types of deals on offer the hottest item seems to be industrial portfolio sales, as around GBP 1.1bn worth of assets are on the block. The activity is being driven by the availability of lending through a broad range of instruments.
CoStar writes that “the sharpening yield at which some portfolios are trading at, which, together with the return to punchy financial engineering, is counter-intuitively enabling opportunistic funds to outbid lower-leveraged institutional investors, despite the latter having considerably lower costs of capital.”
Among the ongoing industrial deals are one for Columbus Capital Management’s secondary Partridge portfolio, which looks to be going for roughly GBP 230m, a price that would reflect a 6.8 percent net initial yield. CoStar reports that a JV between Brockton Capital and Dunedin is the preferred bidder, beating out the likes of AEW Europe and Blackstone.
