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Savills has forecast shopping centre investment turnover in 2009 will exceed the £1.5 bn (EUR 1.6 bn) booked last year following a marked change in investor sentiment towards the sector, which has seen yields begin to harden in the third quarter of 2009.

The international real estate advisor reports that four shopping centres are currently under offer totalling some £600 mln and £1.2 bn has already been transacted between the first and third quarters of 2009. The key issue for the market, Savills says, is the lack of available stock with only two assets being openly marketed in the towns of Shrewsbury and Pollok, Glasgow. This lack of stock has pushed yields down by 58 basis points from 8.63% in the second quarter of 2009 to 8.05% with a further yield hardening anticipated as about 40 investors are actively targeting the market.

Nick Hart, director of shopping centre investment at Savills says: 'Two of the assets currently in the market are the first to be offered through bondholders and banks. The movement in yields will not only be a comfort to these sellers but may well encourage further stock to come to the market. REITS are back in force and under pressure to buy.'

Likewise in the high street investment arena, Savills finds demand has forced prices up and prime top quality assets have been sold at up to 150 basis points lower than at the turn of the year. In particular the report notes institutions have rapidly turned from sellers to buyers.

Jeremy Lovell, director of high street investment, adds: 'Property currently provides a better income return than sitting on cash and as demand outstrips supply there is further prospect of capital growth. We may well see investors, who took bold decisions earlier in the year taking profit.'