■ In another show of confidence, Savills advised AXA Investment Managers on their purchase of The Asticus Building, 21 Palmer Street in Victoria. The freehold interest comprises 59,732 sq ft of office accommodation, let to eight tenants with a weighted average unexpired term of 6.6 years to expiry. The property was acquired from Aberdeen Asset Management, representing their seventh known sale of 2016, for a price of circa £80m, reflecting a topped up net initial yield of approximately 4.00% and a capital value of £1,339 per sq ft.

■ There has already been 9 transactions over £100m in 2016, making up almost 50% of total turnover volume, however we are yet to see a UK institutional purchase over this lot size this year. Historically this behaviour is unusual and taking a snap shot of both last year and a decade ago we see this purchaser type made up 18.7% and 12.7% of this market, respectively (see Graph 1). In contrast, 2016 has shown a notable increase in UK private investment over £100m making up almost 15% of turnover compared to no recorded transactions last year and under 10% in 2006.

■ Demand for prime retail investment opportunities remains strong demonstrated by Savills acquisition of 31 Old Bond Street on behalf of a private Hong Kong Investor. The building, originally marketed in March, sold for £36m, reflecting a net initial yield of 2.59%.

■ We expect the strong demand and sharp yield profiles to continue for retail opportunities in the near future as private investors in particular seek the defensive qualities this asset type generally offers.

^{Source: Savills Research}

■ For the second month running there has been a small uptick trend in both the IPD average equivalent and initial yields to 4.71% and 3.01%, respectively (see Graph 2). The net initial yield is now above 3.0% for the first time in six months.

■ Savills West End team continues to be highly active in transacting business having already advised on in excess of 10 transactions this year. With almost £450m of assets currently under offer, June promises to be a busy month for us.

^{Source: Savills Research, IPD}