Lismore Real Estate Advisors has said a £60 million retail park sale in Aberdeen helped the Scottish investment market get this year off to a strong start.
The property consultancy’s latest figures show first quarter transactional volumes up 260% year-on-year at around £630 million, with volumes about 35% higher than the five-year average.
Lismore said its data signalled a return of confidence and investor appetite for prime assets in Scotland.
Top deals for the quarter included the £140m sale of Silverburn shopping centre in Glasgow, the £111m disposal of Westway Park in Renfrew by Canmoor to Ares Management, Patrizia’s £78.05m sale of Waverleygate in Edinburgh to Kennedy Wilson and the £60m sale of Beach Boulevard Retail Park in Aberdeen.
Opportunistic buyers are seeing value in prime shopping centres.”
Lismore director Chris Macfarlane said: “Prime distribution pricing is hardening, with investors continuing to chase opportunities, which is likely to sustain pricing during 2022.
“Opportunistic buyers are seeing value in prime shopping centres and investor appetite remains for the best repriced quality assets.
“Retail warehousing remains in demand, but stock is limited and competition for the best assets is fierce.
“High Street retail shows signs of recovery, albeit with pricing discounted, offering opportunity for those willing to dip their toes in the water.”
But Mr Macfarlane warned: “Economic pressures, including cost of living and rising energy prices are expected to push inflation to a 40-year high of 8.7% by Q4, so there is the potential for a knock-on effect filtering through to retail spend.”
Lismore said the distribution-logistics sector continued to attract “a significant weight of capital”, with prime Scottish assets “still looking like reasonable value compared to south of the border”.
Aberdeen site under US ownership
Beach Boulevard – the largest retail park in Aberdeen by floor space – changed hands earlier this year.
Its new owner is California-based Realty Income Corporation (RIC), a property trust that invests in free-standing, single-tenant commercial properties in the US, UK and Spain.
RIC acquired the site from abrdn – formerly Standard Life Aberdeen – following a hotly contested bidding process, according to real estate industry website React News.
The seller reportedly knocked back offers worth about £40m 18 months ago.
It was California-based RIC’s second major purchase in Aberdeen, with the investor having previously acquired Garthdee Retail Park in a deal worth nearly £33m.