Small dealerships which are struggling financially continue to drive consolidation in the automotive property sector, according to Colliers International.

David Chittenden, Colliers head of automotive and roadside, said: “Perceived undervaluation of business and property values is driving mergers and acquisition activity and investor appetite remains strong with yields ranging from sub 6% to 8% plus.

“More than £100 million of assets leased to Pendragon have been sold recently.”

Chittenden believes that while retail sales have been slow, trading is stabilising across networks in the UK .

He said: “Financial institutions remain very interested in automotive, especially in manufacturer covenanted facilities.”