According to data from the international real estate advisor, 2020 retail investment volumes are expected to reach between 1.5-2bn euros across traditional products (excluding high street). This is largely due to the sale of Intu shopping centres and large supermarket portfolios which alone could reach 700m euros by the end of the year.
The report shows that there has been increased appetite amongst investors for assets with long-term contracts based on convenience and, as such, supermarket portfolios and medium-sized urban parks have been popular. At present, with supermarket operations in the market estimated to be 500m euros, added to the 190m euros already transacted, a record year that would far exceed the average of some 270 million per year in supermarkets over the last 20 years is expected.
Luis Espadas, Managing Director in the retail division, Savills Aguirre Newman, explains: “Given the global uncertainty and the transformation process that the retail sector is undergoing, investors are looking for defensive assets with long-term contracts and good financial solvency. This investment demand has found an answer in the food sector where several operators have put part of their portfolio on sale via a sale and leaseback strategy.”
On the other hand, a compression of yields in prime food portfolios is expected in Madrid and Barcelona and, although there are no points of reference yet, there is an intention to sell and some price adjustment is expected. In the High Street market, the restriction on mobility has affected investment to a greater extent, which could gain momentum in the second half of the year.
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