C&W concerned about secondary shopping centre values
After yesterday’s results from CSC, here’s some more shopping-centre news. Cushman & Wakefield says yields for prime assets in this sector improved to 5.5% over the second quarter this year, as investment demand has outstripped supply. Yields for smaller and more secondary shopping centres, however, remained relatively static during the quarter, with vacancy rates and falling rents continuing to suppress value.
Charlie Barke, head of retail investment at Cushman & Wakefield, said: “The first half of the year has seen significant yield improvement across the sector, fuelled by investment demand exceeding supply. Looking ahead, demand looks a little thinner and supply appears to be increasing. Whilst prime stock will probably hold up reasonably well, we are concerned about a potential slip in secondary values as the year draws to an end.”
Turnover in the sector during Q2 2010 was similar to the previous quarter, at £673m, but made up of fewer deals – 12 in total, representing 16 shopping centres.
C&W says there are just under £1.1bn of schemes on the market at the moment, including the Ewart properties (Hammersmith, Victoria and Fulham Broadway) with an asking price of £295m, a yield of 5.63%. A number of smaller schemes are either on or are coming to market, include properties in Ayr, St Austell and Dunstable, the group added.
