ATTRACTIVE UK RETURNS FOR ATHANOR INTERNATIONAL PROPERTY INVESTMENTS
Amid a globally depressed property market characterised by considerably reduced property values, Athanor International Property Investments has achieved a notable return of 37 percent for investors on a UK commercial property which was recently sold – Benbow House in central London.
In a joint venture with Pam Golding Properties (PGP), Athanor facilitates quality UK property investment opportunities for South African and international investors on an ongoing basis, with up to seven prime located properties acquired annually.
Comments Eric Mounier, CEO of the Athanor/PGP joint venture: "Following the global credit crunch and in a market which has seen property values declining by some 44 percent over the past 28 months, the achievement of a 37 percent return for investors in this central London property is significant. Acquired five years ago, the property is in a prime location at Southwark Bridge, London SW1 and is tenanted by Pizza Express and Starbucks, as well as a residential component above. The property has always been fully tenanted and the major lease is for a period of 25 years – with 18 years still to run.
"While outstanding returns of between 14 and 48 percent per annum were achieved by Athanor for properties sold in the up-cycle between 2004 and 2007, Benbow House was sold in the worst market conditions experienced since the 1930's. This clearly illustrates the importance of acquiring quality assets typified by favourable locations, strong tenants and long leases," says Mounier.
Given the fact that property values have reduced considerably, opportunities exist to acquire sound properties in the UK at very favourable prices. From a South African investor perspective this is coupled with the fact that exchange controls have been relaxed, enabling individuals to take out an offshore allowance of up to R4 million, increased from R2 million.
"Consumer confidence is returning and the UK is showing signs of recovery and re-emerging as an attractive option for medium to long term investors. The IPD (Investment Property Databank) commercial property index reveals upward movements in capital values in August and September 2009, the first time in over 26 months. We believe this indicates the start of an upward cycle during which investors buying blue-chip, prime located properties in the current depressed market will achieve exceptional returns over the next three to five years," says Mounier.
Athanor's latest acquisition offers investors the opportunity to acquire a stake in a prime positioned convenience store with a petrol station in Hemel Hempstead, a thriving commercial centre and affluent commuter town just 22 miles north-west of central London. The property is let to Somerfield Stores Ltd – with fixed annual rental increases and 18 years unexpired lease, and with guarantees from Co-operative Group, the UK's largest mutual retailer with sales in excess of GBP10 billion. Over the past decade the convenience store market has experienced significant growth.
Says Marco Rapaglia, director of Athanor: "This property has excellent investment potential, underpinned by the rising demand for fuel and continuing expansion of the forecourt convenience store market."
Issued by Gaye de Villiers