47 CONDUIT STREET LONDON W1. Flagship Retail Investment Opportunity

Transcription

1 47 CONDUIT STREET LONDON W1 Flagship Retail Investment Opportunity

2 INVESTMENT SUMMARY Flagship prime retail investment opportunity in the heart of Mayfair, one of the world s most exclusive retail locations Situated on the south side of Conduit Street, close to the junction with Savile Row and New Bond Street Ground floor and basement retail unit with three upper floors comprising office accommodation, totalling a net internal area of 4,323 sq ft Potential for additional fourth floor subject to planning and opportunity to open up basement to create extra retail accommodation The whole property is let to Lalique Limited for a term of 15 years from 4 August 2008 (approximately 8 years unexpired), there is an upwards only rent review on 4 August 2018 The current passing rent is 290,000 per annum, reflecting 293 Zone A and per sq ft on the self-contained offices Virtual Freehold from the City of London for a term of 2,000 years from 25 December 1889 at a fixed ground rent of 7.88 per annum Offers in excess of 14,000,000 (Fourteen Million Pounds), subject to contract and exclusive of VAT reflecting a net initial yield of 2.03% and a reversionary yield of 2.98% after purchaser s costs of 1.80% and a capital value of 3,238 per sq ft. Founded over a century ago, in 1888, Lalique has endured as the ultimate symbol of French luxury. 1

3 Regent Street Oxford Street Conduit Street Bond Street St James s Park Berkeley Buckingham Palace Grosvenor I 2

4 LOCATION Conduit Street is located in the heart of Mayfair in London s West End, which is renowned as one of the world s most exclusive retail locations. Mayfair is characterised by a blend of exclusive retailers, high quality office buildings and luxury residential accommodation. Mayfair boasts a wide selection of high end international restaurants including Sketch, Novikov, Scotts, Nobu, Hakkasan and hotels including The Westbury, The Ritz, Claridge s and The Connaught. SITUATION Conduit Street links Regent Street to the east, New Bond Street to the west and Savile Row to the south. Conduit Street runs east-west between Regent Street and New Bond Street. The subject property is situated on the south side of the street and abuts Donna Karen and Crombie, immediately west of the junction with Savile Row. Conduit Street has become an important retailing link between the luxury Bond Street retail and the high end Regent Street market. It remains a prestigious office location being situated within the core Mayfair district. 3

5 COMMUNICATIONS Conduit Street benefits from excellent public transport and is served by Oxford Circus (Central, Bakerloo and Victoria lines), Bond Street (Central and Jubilee lines) and Green Park (Piccadilly, Jubilee and Victoria lines) Underground stations. London s International airports are accessed via the Heathrow Express departing from Paddington and the Piccadilly line as well as the Gatwick Express departing from Victoria Station. The opening of the Crossrail station in Hanover (2 minutes walk) in 2018 will have a significant impact on both retail and office lettings in Mayfair. The new rail link will provide access to Heathrow (29 minutes) and Canary Wharf (13 minutes). CROSSRAIL ROUTE MAP Hyde Park SOUTH ST. Grosvenor PARK LA. WIGMORE ST. DUKE ST. DUKE ST. CARLOS PL. SOUTH AUDLEY ST. PARK LA. MOUNT ST. Bond Street FARM ST. CURZON ST. DAVIES ST. HILL ST. HAY S MEWS HENRIETTA PL. BROOK ST. CHARLES ST. Cavendish OXFORD STREET GROSVENOR ST. Berkeley NEW BOND ST. CURZON ST. PICCADILLY HOLLES ST. ST GEORGE ST. Hanover GENT ST. Green REAT PORTLAND ST. MARGARET ST. MARGAR HAY HILL Oxford Circus PRINCES ST. BERKELEY ST. HANOVER ST. CONDUIT ST. DOVER ST. ALBEMARLE ST. Green Park SAVILE ROW REGENT ST. OLD BOND ST. ARLINGTON ST. T. EASTCASTLE ST. OXFORD STREET GREAT MARLBOROUGH ST. NOEL CARNABY ST. ST JAMES S ST. WARWICK ST. SACKVILLE ST. PICCADILLY WELLS ST. BROADWICK ST. Golden REGENT ST. BENERS ST. WARDOUR ST. GREAT PULTENEY JERMYN ST. T. BREWER ST. St James s ONE PL. DEAN ST. RUPERT ST. RUPERT ST. SHAFTESBURY AVE. Piccadilly Circus Soho COVENTRY RD. ST ALBANS RD. FRITH ST. HAYMARKET REGENT ST. WATERLOO PL. CHARLES II ST. GREEK ST. OLD COMPTON ST. GERRARD ST. LISLE ST. St. James s CHARING CROSS RD. Leicester COCKSPUR ST. PALL MALL PALL MALL EAST ALL Tottenham Court Rd SHAFTESBURY AVE. WHITCOMB ST. HOR EARLHAM ST. Leicester CHARING CROSS RD. STRAND ST MARTIN S LA. ST MARTIN S PL. Reading Taplow Slough Iver Hayes & Harlington Hanwell Ealing Broadway Bond Street Farringdon Whitechapel Stratford Maryland Forest Gate Manor Park Ilford Seven Kings Goodmayes Chadwell Heath Romford Gidea Park Harold Wood Brentwood Shenfield Maidenhead Burnham Langley West Drayton Southall West Ealing Acton Paddington Main Line Tottenham Court Road Liverpool Street Custom House Abbey Wood Surface line Heathrow Airport Canary Wharf Woolwich Tunnel Portal (tunnel entrance and exit) 4

6 LADIES & MENS WEAR DIOR UNDER OFFER RETAILING ON CONDUIT STREET Luxury retailers who are unable to secure representation on New and Old Bond Street are now acquiring space on Conduit Street, being a prime but comparatively affordable trading location. Conduit Street has recently been enhanced by the completion of a number of flagship retail lettings as shown on the map: 5

7 DESCRIPTION The property provides an attractive 18th Century Grade II listed building with prominent frontage to Conduit Street 20 7 ft (6.27 m). The property is arranged over basement, ground and three upper floors providing a total net internal floor area of 4,323 sq ft ( sq m) of retail and office accommodation. The building provides retail on the ground floor with ancillary storage at basement level. The ground floor retail unit comprises a rectangular floor plate which benefits from a large sky light in the trading area. This could easily be amalgamated to create a fashion maison with retailer owner occupation potential. Office accommodation is located on the first, second and third floors which is accessed through the shared main entrance off Conduit Street. The first floor office accommodation benefits from full height French windows and cast iron balconies overlooking Conduit Street. 6

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9 ACCOMMODATION The property provides the following Net Internal Areas: Floor Basement Use Retail Storage Net Internal Floor Area (sq ft) (sq m) Ground Sales Retail 1, Ground ITZA Retail 658 Retail Total 2, First Office Second Office Third Office Office Total 1, Total 4,

10 TENURE The property is held by way of a Virtual Freehold interest from the City of London for a term of 2,000 years from 25 December 1889, providing approximately 1,874 years unexpired, at a fixed ground rent of 7.88 per annum. 2 4 Mill Street TENANCY New Burlington Place Let in its entirety to the world famous Lalique Limited for a term of 15 years from 4th August 2008, expiring 3rd August 2023 (approximately 8 years unexpired) on full repairing and insuring terms. Surety is provided by Art & Fragrance Group St George Street a Offices Offices 3 The current rent payable is 290,000 per annum reflecting 293 Zone A and per sq ft on the self-contained offices. There is an upward only rent review on 4th August Lalique Limited have sub-let part of the office accommodation as shown below: a Conduit Street Savile Row 23 Offices 4 New Burl Floor Tenant Area (sq ft) 1st Oliver Law Limited Lease Expiry /06/2015 Rent (psf) 25,000* ( 41.94) 1954 Act Outside Comment Believed to be currently holding over a Retail 25 Boyle Street Heathcote House 12 2nd Spring Films Limited /06/ ,000* ( 49.18) Outside Believed to be currently holding over Old Burlington Street Total 55,000 *All inclusive rent. Retail Clifford Street Savile Row 15 Offices 4 9

11 TENANT FINANCIAL INFORMATION Lalique Limited Lalique was first founded in 1888 and is an internationally renowned crystal manufacturer specialising in jewellery, glassware, luxury goods and high end perfume. Lalique is represented in 541 stores all over the world ranging from local community pharmacies to large destination health and beauty stores. Swiss group Art & Fragrance acquired Lalique in 2008 (under the management of Silvio Denz) and Surety is provided by Art & Fragrance Group. For more information please visit Art & Fragrance SA D&B Credit Rating: 4A1 Art & Fragrance Group was founded in 2000 specialising in perfumes, cosmetics, crystal glass, jewellery, high-end furniture, art and living accessories. Art and Fragrance employs over 500 staff throughout the world. The group parent company, Art & Fragrance SA, is headquartered in Switzerland and Art & Fragrance SA is listed on the BX Berne exchange. Art & Fragrance SA has filed the following accounts over the last two years. Art & Fragrance SA (CHF) - Swiss Francs 2014 (CHF) - Swiss Francs 2013 Group profit before tax 400,000 31,510,000 Total current assets 376,000 3,383,000 Total equity 92,388,000 92,024,000 For more information please visit 10

12 MARKET COMMENTARY Retailer demand on Conduit Street remains strong from internationally renowned retail and luxury brands. In 2014 record rents on Conduit Street were achieved at over 500 Zone A. In addition, retailers are now paying significant premiums to secure representation. This fuels rental growth in the short to medium term. The property lends its self as a headquarters fashion Maison for a continental brand looking to establish a premier representation in Mayfair. Prime retail rents on Conduit Street compare favourably to: Retail Leasing Transactions: The most recent transactions on Conduit Street in close proximity include: Date Address Tenant Transaction Rent pa Rent Zone A Q Conduit Street Vanessa Gounden OML 160, Q /53 Conduit Street Christian Liaigre OML 525, Q /50 Conduit Street Dd OML 1,325, In view of the latest evidence we believe the current ERV of the property to be 425,000 per annum. This assumes a Zone A rate of 475 and 75 per sq ft on the prestigious office accommodation. Bond Street 1,600 Zone A Oxford Street 1,000 Zone A Regent Street 675 Zone A Albermarle Street 600 Zone A Dover Street 600 Zone A Investment Transactions London is the most globally sought after destination for international real estate capital. In 2014 the West End reached trade volumes of 5.9 billion, the fourth highest on record and 64% of which fuelled by overseas capital, with investors attracted by low interest rates, high liquidity, transparency and the long term wealth preservation that London offers. Date Address Area (Sq ft) Tenant Tenure Price Capital Value (psf) Q Conduit Street 1,443 Vanessa G. (UK) Ltd FH 5.1m 3, % Yield Q Marylebone High Street 2,621 J.Crew VFH 9.5m 3, % Q Conduit Street 4,843 Vivienne Westwood VFH 10.75m 2, % Q Great Marlborough Street 3,612 Starbucks LLH 4.14m 1, % Q Mount Street 5,000 Moynat LLH 27.00m 4, % Q Grafton Street 13,238 The Government of the Hong Kong Special Administrative Region FH/VFH 35m 2, % 11

13 VAT The property is elected for VAT and therefore it is proposed the transaction will be treated as a Transfer of a Going Concern (TOGC). EPC The EPC certificate is available upon request. PROPOSAL Offers are sought in excess of 14,000,000 (Fourteen Million Pounds) for the issued share capital in the BVI based SPV, subject to contract and exclusive of VAT, reflecting a net initial yield of 2.03% on the current passing rent of 290,000 per annum and a reversionary yield of 2.98% after deducting acquisition costs of 1.80%. A purchase at this level represents a capital value of 3,238 per sq ft. CONTACT Richard Brown / richard.brown@eu.jll.com James Bramble / james.bramble@eu.jll.com Megan Hutchinson / megan.hutchinson@eu.jll.com Anthony Epenetos / ae@thelorenzconsultancy.co.uk Andrew Knights / ak@thelorenzconsultancy.co.uk Anthony Lorenz / aml@thelorenzconsultancy.co.uk Misrepresentations Act 1967 & Declaration: Jones Lang LaSalle for themselves and for the vendors of this property whose agents they are give notice that: a) the particulars are set out as general outline only for the guidance of intending purchasers and do not constitute, nor constitute part of, an offer or contract; b) 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 purchaser should not rely on them as statements or representations of fact but should satisfy themselves by inspection or otherwise as to the correctness of each of them; c) no person in the employment of Jones Lang LaSalle has any authority to make or give any representation or warranty whatever in relation to this property. Ordnance Survey Crown Copyright All rights reserved. Licence number Not to scale. For indicative purposes only. October 2015 Tayler Reid I I taylerreid.co.uk 12