FPD Savills - Retail -

Date: 04 Sep 1998

Only about half of the £2bn property investment allocation for the retail warehouse sector is likely to be spent this year according to FPD Savills latest Retail warehousing Quarterly report.

At the beginning of this year a telephone survey of institutions and property companies reveled that in excess of £2bn had been allocated for investment in this sector, to date only around £650 million has been spent. "With a limited number of existing retail parks," claims the report, "and few new sites filtering through, it is hard to believe that even half of the allocation will be spent."

The second quarter of 1998 has been characterised by relatively few, large transactions. These include: Equitable Life's purchase of Wessex Gate Retail Park, near Poole in Dorset for £30 million; British Land's acquisition of Westgate Retail Park, Wakefield for more than £34 million; and the purchase of Fosse Park and Fosse Park South in Leicestershire by Pillar, Schroders and Caisse de Depot in a combined deal totaling £205 million.

Director Martin Supple of FPD Savills said: "Substantial funds are available for retail warehousing for the remaining quarter of 1998, however, investors are now more discerning in their stock selection, particularly regarding secondary investments which have tended to be overpriced during the last 12 months."

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