Prime Leeds City Centre Retail Investment

Transcription

1 FOR SALE Prime Leeds City Centre Retail Investment Halifax Bank, 32/33 Commercial Street Leeds, LS1 6EY

2 Investment Summary Rare opportunity to acquire a prime well-let city centre retail investment Prime retail pitch on Commercial Street in the heart of Leeds pedestrianised area, adjacent to a principal entrance to Trinity Leeds 5,958 sq ft retail unit over ground and 2 upper floors and basement, with a ground floor sales area of 1,876 sq ft 8 year remaining term to the undoubted covenant of Bank of Scotland Plc Passing rent of 380,000 pa We are instructed to seek offers in excess of 6,250,000 reflecting a net initial yield of 5.70%

3 Location UK Transport Network Leeds is situated at the heart of the Northern Powerhouse, approximately 40 miles east of Manchester and 190 miles north of London. The city lies 7 miles north of the intersection of the M1 (J42) and M62 (J29), with direct access to the motorway network from the city centre via the M621. ABERDEEN Newcastle The Leeds City Region is the largest economy outside of London and one of the most diverse. The city region has a total workforce of almost two million and a GVA of billion. Leeds has a historic strength in financial and professional services but also has concentrations of employment in advanced manufacturing, digital industries and education. GLASGOW EDINBURGH NEWCASTLE Leeds York Leeds City Railway Station is the UK s second busiest rail station outside of central London with over 900 trains and 50,000 passengers per day. Services to London Kings Cross are every 30 minutes with a fastest journey time of 2 hours. Leeds is also the regional transport hub for Yorkshire, providing local services and regular trains to Manchester, York, Sheffield and Newcastle. Leeds Bradford International Airport is 8 miles to the north west of the city centre and presently caters for 3m passengers a year. This is forecasted to nearly triple by 2030, with 28m currently being invested in improving the airport s infrastructure. The airport serves 70 destinations including 4 daily British Airways flights to London Heathrow. Leeds is planning to submit a bid to be European capital of culture in 2023, which will surely provide a further boost to the city. PENZANCE LEEDS BRADFORD INTERNATIONAL AIRPORT LEEDS MANCHESTER LIVERPOOL BIRMINGHAM BRISTOL HULL PORT OF HULL SHEFFIELD LONDON Manchester (Services every 30mins, travel time 2 hours) Sheffield London Kings Cross at the heart of the Northern Powerhouse over 2M workforce 900 trains & 50,000 passengers every day GVA of 58BN a forecasted 9M passengers per year by 2030 Leeds is planning to bid to be European Capital of Culture in 2023

4 Demographics Leeds has a primary catchment population of 1.5 million which ranks it 4th out of all the major centres. The high figure is in excess of that which you would expect for a Major City (Promis). An impressive 642,000 people consider Leeds to be their main shopping destination, showing the dominance of the centre. The population is boosted by the 50,700 full time higher education students in the city. Of these, 7,245 are post graduates and 43,455 are undergraduates. As a result of the strong catchment, Leeds in-store retail expenditure is ranked 2nd nationally. It is forecast to grow at 1.6% in real terms over the next five years, above the Major City average of 1.2%. Expenditure is boosted by tourism with Leeds receiving 25 million day visitors per annum, generating in excess of 650m. In addition, 1.8 million overnight trips are made, generating a further 340m. 1.5M catchment population which ranks Leeds 4th out of all the major centres. 25M day visitors per annum = 650M 1.8M overnight trips = 340M 642,000 consider Leeds to be their main shopping destination Situation The property occupies a prominent position on Commercial Street, which is at the heart of the pedestrianised retail core in Leeds. Halifax is adjacent to one of the principal entrances to Trinity Leeds, which also provides access to the city s Marks and Spencer store. Commercial Street also acts as the main pedestrian thoroughfare between the office core to the west and Briggate and Victoria to the east. Furthermore, following the opening of Victoria Gate in Autumn 2016, Commercial Street has become an important part of the pedestrian route between the city s two major shopping centres. The eastern end of Commercial Street is becoming a hub for Leeds higher end jewellers, including Ernest Jones, Berry s and Beaverbrooks. The western end of Commercial Street will be boosted by the redevelopment of the former Next Clearance store on the corner of Bond Street and Albion Street, where a number of high profile leisure lettings have been agreed. This will soak up much of the available space around Commercial Street. Other retail occupiers on Commercial Street include Clarks Shoes, Lush, Monsoon, Paperchase and Ecco. There are also a number of A3 occupiers in the vicinity including ITSU, Starbucks and Pret a Manger.

5 Leeds City Centre

6 Description 32 Commercial Street is an attractive late 19th Century retail premises of steel frame construction with stone façade. The property is arranged over ground and two upper floors with storage and bank vault in the basement. The ground floor benefits from full height glazed panelling and has a separate entrance providing access to the upper floors. The upper floors have tall windows overlooking Commercial Street. Internally, the ground floor is a regular rectangular unit, currently used as a banking hall, and is fitted out in the tenant s modern corporate style. The first floor is also fitted out in the same style and provides further banking facilities and meeting rooms. The second floor provides storage and staff facilities. There is further storage and the bank vault in the basement. Access to all floors is provided by two staircases and passenger lift. Accommodation We have measured the property in accordance with the RICS Code of Measuring Practice and calculate that it provides the following net internal areas: Floor Use Sq Ft Sq M Ground Sales 1, Ground ITZA 1, First Banking Hall/ Offices 1, Second Staff facilites & storage 1, Basement Storage 1, Total 5, Tenure Freehold.

7 Tenancy The property is let to Bank of Scotland Plc by way of a 20 year lease from 27 May 2005 and expiring on 26 May There is therefore approximately 8 years remaining on the lease. The annual rent is 380,000, subject to 5 yearly upward only rent reviews to open market rent with the next review on 27 May The lease is fully repairing and insuring. Under the terms of a supplemental deed to the lease, the tenant is responsible for insuring the property directly. A copy of the occupational lease and the supplemental deed is available from the GVA marketing website gva.co.uk/9949. Covenant Bank of Scotland Plc has a Dunn and Bradstreet Rating of 5A1 and have the following financial highlights: Date of Accounts Turnover Pre-tax Profits Shareholder s Funds 31/12/ ,475,000,000 2,653,000,000 15,111,000,000 31/12/ ,192,000,000 3,400,000,000 21,335,000,000 31/12/ ,033,000,000 1,450,000,000 18,354,000,000

8 Leeds Retail Market The Leeds retail market has traditionally been centred around the pedestrianised Briggate and Commercial Street. Briggate has typically provided the larger format stores, including Debenhams and House of Fraser, with Commercial Street typically providing smaller units. Leeds city centre has been transformed in the past 4 years with a number of retail led developments. Firstly, in 2013 Land Securities opened Trinity Leeds, which adjoins Commercial Street and is directly behind the subject property. The scheme has a total retail floor area in excess of 1 million sq ft and has brought over 40 new retail brands to Leeds, including Apple, Hollister and Victoria s Secret, as well as an Everyman Cinema and a host of restaurant operators. The scheme has since developed into not just a shopping destination but also a major leisure destination in the evening. Commercial Street has seen a significant boost since the opening of Trinity Leeds, with vacant units being taken up and retailers reporting increased footfall driven by adjacency to the scheme. Leeds position as the North s premier retail destination was then cemented in August 2016, when Hammerson opened their muchawaited Victoria Gate development which delivered the country s largest flagship John Lewis store outside of London. The scheme also features a number of internationally recognised brands which are new to Leeds such as Tommy Hillfiger, Gant and 30 other retail and leisure units and a new super casino. Victoria Gate compliments Hammerson s existing Victoria Quarter covered arcade, which is well-renowned for providing high end boutique fashion retailing. Victoria Quarter is home to the first Harvey Nicholls outside of London and over 70 of the world s leading designer brands such as Paul Smith, Vivienne Westwood, Louis Vuitton and Mulberry. Victoria Gate Trinity Leeds

9 Investment Market The following retail investments have taken place in Leeds over recent months. Date Address Tenant Remaining Term Price Net Initial Yield Under Offer 7 Commercial Street, Leeds Ecco Shoes 4 years c. 1.88m c. 5.00% January Cambridge Street, Harrogate Carphone Warehouse, Smiggle, Card Factory, H Samuel 6, 4.5, 5 & 3 years 4.825m 5.19% October James Street, Harrogate Hobbs 8 years 3.125m 4.00% August Prospect Centre, Harrogate HSBC 5 years 5.625m 5.00% May Lands Lane/ 27 Albion Place, Leeds Pret a Manger 6 years 3.66m 4.75% March /91 Briggate, Leeds Carphone Warehouse (t/a Samsung) 4.5 years 2.95m 4.95% January Parliament Steet, York TSB Bank 7 years 3.10m 4.87% April /97 Briggate, Leeds Yorkshire Bank & Pandora 20 years & 5 years 12.25m 4.64% March Albion Street, Leeds Starbucks 10 years 4m 4.73%

10 Energy Performance Certificate The property has an EPC rating of C (68). Copies of the EPC and Recommendation Report are available from the data room. VAT The property is not elected for VAT. Furthermore there is a supplemental deed to the lease which obligates the landlord not to elect the property for VAT as long as Halifax Plc (or a Lloyds Banking Group company) remains the tenant. Proposal We are instructed to seek offers in excess of 6,250,000, reflecting a net initial yield of 5.70%. This reflects purchase costs of 6.63%. Further Information For further information, or to arrange a viewing, please contact: James Yates james.yates@gva.co.uk Ben Hall ben.hall@gva.co.uk gva.co.uk/9949 gva.co.uk/9949 IMPORTANT NOTICE RELATING TO THE MISREPRESENTATION ACT 1967 GVA on their behalf and for the sellers or lessors of this property whose agents they are, give notice that: (i) The Particulars are set out as a general out line only for the guidance of intending purchasers or lessees, and do not constitute, nor constitute part of, an offer or contract; (ii) All descriptions, dimensions, references to condition and necessary permissions for use and occupation, and other details are given in good faith and are believed to be correct, but any intending purchasers or tenants should not rely on them as statements or representations of fact, but must satisfy themselves by inspection or otherwise as to the correctness of each of them; (iii) No person employed by GVA has any authority to make or give any representation or warranty in relation to this property. Unless otherwise stated prices and rents quoted are exclusive of VAT. The date of this publication is March Designed and produced by Anderson Advertising and Property Marketing Limited T