Investors Focusing On Prime Retail Portfolios

Retail property investment companies are building up their portfolios with prime assets at the expense of secondary locations, it has been revealed...

Retail property investment companies are building up their portfolios with prime assets at the expense of secondary locations, it has been revealed. A report released by the British Property Federation (BPF) has found that there is a widening gap between the performance of prime and secondary retail outlets. According to the organisation, those that own retail units in desirable areas have experienced "solid rental growth, footfall and occupancy levels".

As a result, the BPF expects to see an increasing number of vacant outlets in secondary locations, as retailers aim to shore up their business, which will further encourage investors to look to prime assets. The survey also revealed that there is growing variations between the UK's regions, with southern areas significantly outperforming the Midlands and the north in terms of vacancy rates.

Last month, Savills predicted that there will be an "extremely busy finish to 2011" in the shopping centre investment market. Investment director at the firm Nick Hart explained that prime assets are likely to see a strengthening of yields, while secondary and tertiary locations will sell, but at "yields that reflect the underlying uncertainty of retailers occupying this space".
 

- Friday 09 September 2011

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