Property hunters look to pubs for bargains
THE decline in the urban pub trade has been reflected in the latest commercial property auction held by Midlands auctioneer Bigwood.
The company said its most recent sale, held in the Holte Suite at Villa Park, saw strong interest in the portfolio of empty licensed premises.
Overall, the company said more than 70% of the lots available had been sold, raising almost £9m, making the event one of the best sales held outside London.
Auctioneer and managing director Rory Daly said: “Out of 103 lots, 13 were sold before the auction as the vendors did not want to risk turning down offers for, in some cases, well in excess of the guide price.
“Some of the vacant commercial property did surprisingly well but the higher value commercial investments did not do as well as we had anticipated.”
He said one reason for the caution might be the continuing squeeze on bank lending which was restricting sales in excess of £500,000.
“To buy something at auction over £500,000 you have to be able to raise getting on for £200,000 in cash in order to secure the remaining lending required,” he said.
“There is no doubt that demand is back in the sale room but until the lending logjam is cleared, some of the higher value commercial property lots will still struggle to sell.”
Particularly buoyant were lots offered by local authorities and Birmingham City Council’s coffers were substantially boosted with many lots achieving well over their reserve.
Lot 1 saw 12-14 Baker Street in Sparkbrook sold for BCC for £196,000 against a reserve of £50,000 and this was a pattern repeated throughout the sale.
A vacant leasehold mid-terraced property at 81 Eileen Road, Sparkhill, achieved £81,000 off a £50,000 reserve, again for the city council.
Bidding really took off when a freehold development site of just under one acre at Adderley Road, Saltley, achieved £285,000 from a reserve of £50,000.
The former Edwin Arrowsmith Elderly Persons Home at 8 Payton Road, Handsworth, sold for £540,000 from a £400,000 reserve.
A number of lots offered through LPA (Law of Property Act) receiverships did extremely well, which included a freehold retail property with potential accommodation above at 290 Alum Rock Road sold for £167,000 from a £85,000 guide price.
Another LPA receivership, a freehold retail investment at 34 Old Walsall Road, Perry Barr, achieved £134,000 from a reserve of £105,000.
“There was strong demand for vacant residential properties which sold very well, as well as regulated tenancy residential investments,” added Mr Daly.
The firm’s next auction takes place on July 21.
