As we begin a new decade, three auctioneers from the UK’s largest commercial auction houses – Richard Auterac, director and auctioneer at Acuitus, George Walker, partner and auctioneer at Allsop, and Oliver Childs, head of commercial auctions at BidX1 – share their hopes, fears and expectations for 2020.
>> Hopes
Richard Auterac: I hope high street retail becomes less of a turn-off for investors. I’d like to see rents and business rates in towns across the UK set at sustainable levels that allow retailers to run profitable businesses selling products and services people can afford.
Private investors have been finding critical mass for alternative investments that are not high street retail, but are similar to it – for example hotels, gyms and public houses. These offer the long leases and good covenants investors want.
It would be nice to say goodbye to the uncertainty of Brexit and the general election. With the regions outside London and the South East accounting for 75% of auction sales, we hope rising incomes and confidence will permeate every part of the UK.
There are a lot of owners who have a lease coming up for renewal who are questioning whether they have the skills to get through that renewal. We would like to see a robust occupational market and growing private investor base. We’re trying to offer a service investors want.
George Walker: We raised more than £430m last year but I hope, and I think we can get to half a billion this year. People see property as a long-term investment and I don’t think that is going to change.
Oliver Childs: With more sales being conducted online, the reach of auctions is becoming wider and wider and that has benefits for both buyers and sellers. I would like to see auctions become a larger part of the sales process in the UK.
>> Challenges
RA: We need to improve education [about the auctions process] and that’s something I’ve asked the RICS to put at the top of its list: to improve understanding of how private investors work and the role auctions play in that.
GW: One of the most challenging aspects is trying to figure out where people can find different alternative assets to invest their money in. That’s what they’re after and that’s the message we keep getting.
OC: It’s getting the price right – ultimately, our biggest challenge is pricing. But we have a room full of experts that will make us rise to the challenge. We also have to tweak every part of the process so we are best in class at every stage. We want to ensure clients enjoy buying and selling throughout the process.
>> Expectations
RA: From an auctioneer’s perspective, tomorrow will always be better than today. I think if there’s greater certainty, that will definitely encourage more sellers to sell. I think there are risks in the market.
GW: Last year, we had a consistently strong number of bidders in the room. We had a solid year in 2019, but I think there will be a gradual pick-up this year. It was as though buyers knew that the [election] result would support property investment and we believe they were right. That sentiment bodes well for the market in 2020. We think the handbrake of uncertainty will come off. The next phase of price growth is some way off, but increased liquidity in the number of deals will be the first step.
OC: Having talked to a lot of clients from many sectors, coming into 2020, we definitely forecast an increase in deals compared with last year. It’s still early days but we’ve already seen transactions, with people buying assets in different countries. I think the market will open up both globally and in terms of widening our UK client base.
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