MODERN SINGLE LET INDUSTRIAL INVESTMENT OPPORTUNITY 4-6 SOUTH LUMLEY STREET GRANGEMOUTH FK3 8BT

Transcription

1 MODERN SINGLE LET INDUSTRIAL INVESTMENT OPPORTUNITY 4-6 SOUTH LUMLEY STREET GRANGEMOUTH FK3 8BT

2 INVESTMENT SUMMARY Modern single let industrial investment opportunity; Located in Grangemouth, approximately 24 miles west of Edinburgh and 27 miles east of Glasgow; Grangemouth is one of Scotland s most strategic industrial, manufacturing and distribution locations; The property comprises a modern warehouse, extending to 43,256 sq.ft (4,018.6 sq.m), that has been comprehensively refurbished; Let in its entirety to Epiroc UK & Ireland Ltd with a guarantee in place from Epiroc AB (D&B Failure Score of 83/100); The property is let until 10th June 2023, incorporating a tenant break option on 10th June 2021, providing an unexpired term of 4.68 years to expiry and 2.68 years to break; Current rent is 194,652 per annum, reflecting a low passing rent of 4.50 psf; Heritable interest (Scottish equivalent of English Freehold); The site area extends to 1.83 acres (0.74 hectares), providing a low site coverage of 54%. Offers in excess of 2,165,000 (Two Million, One Hundred and Sixty Five Thousand Pounds Sterling), exclusive of VAT, are sought for our clients Heritable interest in the property. This reflects an attractive net initial yield of 8.50% and a capital rate of 50psf, assuming purchaser s costs of 5.85% SOUTH LUMLEY STREET GRANGEMOUTH

3 INVERNESS LOCATION M8 GLASGOW M77 AYR 0 STIRLING M80 M80 M73 M8 M74 M74 ABERDEEN DUNDEE PERTH ST ANDREWS GRANGEMOUTH A1 LIVINGSTON EDINBURGH Grangemouth is a strategically located town in East Stirlingshire forming part of the Falkirk Council area within Scotland s Central Belt. It is located approximately 24 miles to the west of Edinburgh and 27 miles to the east of Glasgow. It is well connected to Scotland s motorway network, with the motorway running along the southern side of the town, with two junctions providing links to the motorway. The excellent access makes Grangemouth one of central Scotland s most strategic industrial, manufacturing and distribution locations. The main industry in Grangemouth and the wider Falkirk area is petrochemicals, with the Grangemouth refinery Scotland s main petrochemical complex, one of the largest of its kind in Europe. INEOS operate the complex, which employs 1,300 people, and have recently announced they will depend on the expertise based at Grangemouth when developing their new propane dehydrogenation unit in Europe, in a move set to benefit the local economy. A further 0.5 billion is set to be invested in Grangemouth within the next two years, with the construction of a new power plant and doubling the size of the cracking facility. Grangemouth also houses Scotland s largest container port, with approximately 9 million tonnes of cargo passing through the dock each year. The success of the port is due to the town s location in the heart of Scotland which makes is readily accessible for distribution to all parts of the country. Grangemouth is also one of Scotland's main rail freight terminals, that has benefitted from major investment in the last decade, making it an integral part of transporting cargo to Aberdeen and the English Midlands. STRANRAER DUMFRIES SOUTH LUMLEY STREET GRANGEMOUTH

4 WH Malcolm Grangemouth Freight Terminal 6 ASDA CalaChem Syngenta H.W Coates Jarvie Plant Jewson Grangemouth Port Whyte & Mackay 4-6 South Lumley Street SOUTH LUMLEY STREET GRANGEMOUTH

5 M876 SITUATION J7 The site sits within central Grangemouth, in a prominent position at the junction between South Lumley Street, Wallace Street and Dundas Street. The property is well placed to benefit from the motorway, with Junctions 5 and 6 both located less than 1.5 miles from the property. The connects to Edinburgh in the east and to Glasgow in the west, via the M876. It also provides direct access to the north of Scotland, creating comprehensive motorway access throughout Scotland. M876 NORTH BROOMAGE TOWARDS GLASGOW STENHOUSEMUIR CARRONSHORE CARRON 4-6 SOUTH LUMLEY STREET RIVER FORTH The surrounding area is a mixture of residential and industrial usage. Grangemouth Port is located approximately 0.3 miles north of the property, making it an ideal position for Epiroc, who service and supply component parts to the oil and gas industries. Surrounding occupiers include Jewson, Whyte & Mackay Distillers, Malcolm Group, Asda Distribution Depot and INEOS. SOUTH BROOMAGE CAMELON BAINSFORD A9 FALKIRK A9 A904 A904 J6 A904 SOUTH LUMLE Y STREET A905 B9 132 A904 GRANGEMOUTH INCHYRA ROAD A905 A904 Drive Times: Destination Miles Drive Time CALLENDAR ROAD A9 LAURIESTON J5 TOWARDS ENDINBURGH Falkirk 3 9 minutes A803 Stirling minutes Edinburgh minutes WESTQUARTER J4 Glasgow minutes GLEN VILLAGE REDDING Perth minutes Dundee 60 1 hour 10 minutes SOUTH LUMLEY STREET GRANGEMOUTH

6 DESCRIPTION The property comprises a modern industrial unit, with associated office and workshop accommodation. It extends to 43,256 sq.ft (4,018.6 sq.m) and has been comprehensively refurbished. The building is constructed predominantly of brick, with a steel and timber roof structure. The roof has been re-clad with insulated polyester coated steel panels and incorporates twinskinned translucent panels to provide natural daylight into the unit. The eaves height in the warehouse is approximately 4.11m. The main warehouse is accessed via 3 roller shutter doors, with 11 further doors providing access to the workshops that run along the western elevation of the property. Electronically operated roller and sectional overhead doors have been installed throughout the property. The existing floor slab within the warehouse has been overlaid with a new 150mm reinforced concrete slab. The building has been fitted with an entirely new electrical installation with all new switch gear and distribution cabling. The building is lit via LED lighting panels. The property has the benefit of a 0.55 acre (0.22 hectare) yard area accessed from Dundas Street SOUTH LUMLEY STREET GRANGEMOUTH

7 ACCOMMODATION The property has been measured in accordance with the RICS Code of Measuring Practice (6th Edition) and extends to the following approximate Gross Internal Areas (GIA): Destination Sq.ft Sq.m Warehouse 2, ,024 Front Office ,993 Workshops ,187 Garage ,639 Ancillary Office ,412 Total 4, ,256 The total site area extends to 1.83 acres ( 0.74 hectares), providing a low site coverage of approximately 54%. TENANCY INFORMATION The property is let in its entirety to Epiroc UK & Ireland Ltd with a guarantee in place from Epiroc AB. It is let on Full Repairing and Insuring terms, subject to a general specification schedule of condition, from 11th June 2018 until 10th June 2023, incorporating a tenant break option on 10th June 2021, subject to 6 months notice. The current rent is 194,652 per annum, equating to a low passing rent of 4.50 per sq.ft. The tenant was previously based across 11 units in Stirling and consolidated into the subject property this year. South Lumley Street is ideally positioned for Epiroc for access to the port and motorway network and they have invested over 250,000 fitting out the unit for their occupation SOUTH LUMLEY STREET GRANGEMOUTH

8 COVENANT Epiroc is a Swedish engineering company formed in 2017 by Atlas Copco, a multinational manufacturing and engineering business which was founded in 1873 and employs in excess of 45,000 staff. Epiroc is headquartered in Stockholm and manufactures equipment for the mining and construction industries, employing approximately 13,000 people. Epiroc UK & Ireland UK Ltd is a newly incorporated business entity and therefore do not have historical financial performance figures. The lease is guaranteed by Epiroc AB, D&B Failure Score of 83/100. A summary of their most recent financial performance is follows: DEC 2017 Total Assets* 4,253,166,000 Tangible Net Worth* 3,783,836,000 *All figures are based on the currency exchange rate as at 26th September 2018 (OECD) SOUTH LUMLEY STREET GRANGEMOUTH

9 SCOTTISH INDUSTRIAL PROPERTY MARKET The Scottish industrial market is currently experiencing under-supply in prime areas, that has been compounded by a limited amount of development activity in the last 10 years. Current supply across Scotland has fallen by approximately 49% since 2010 to the present 14.9m sq.ft. The vacancy rate has dropped from 14.6% to 7.5%, with only 6% of available stock being new or refurbished. Minimal development is expected in the coming years and it is forecasted that industrial supply will continue to fall throughout 2018 and into As a result, this will create a landlord friendly market with the potential for rental growth and the reduction in incentives going forward. The availability of industrial stock in Grangemouth specifically, is at critical levels. There is approximately 20,000 sq.ft of stock under offer, leaving less than 19,000 sq.ft of accomodation available, non of which was constructed post The industrial investment market in Scotland continues to be favoured by investors due to the strong occupational story and low capital values per sq.ft. The opportunities offered in Scotland provide a relative yield discount to the rest of the UK, that income focussed investors can benefit from. Recent investment transactions are highlighted below: Date Address Area (Sq.ft) AWULT Price NIY Capital Rate (psf) Comments Sep-18 Fullarton Drive, Cambuslang 61,199 5 years 5.03m 5.90% 82 Single let to Speedy Asset Services Ltd Sep-18 Laurieston Road, Grangemouth 88, years 4.90m 7.50% 56 Single let to Thornbridge Sawmills Ltd Aug-18 Wardpark, Cumbernauld 20, years 1.63m 7.00% 80 Single let to Briggs Equipment UK Dec-17 Units 1, 2 & 3 Starlaw Park, Livingston 138, years 8.65m 7.75% 62 Oct-17 Unit 1, Oakbank Park, Livingston 32,150 Oct-17 Righead Industrial Estate, Bellshill 27,077 8 years (2.5 years to break) 15 years (12 years to break) 1.60m 9.79% 50 Single let to Vow Europe Ltd Sale comprised three distribution units let to Alcatel-Lucent Uk Ltd, CFH Docmail, Young s Seafood Ltd 2.35m 7.25% 87 Single let to Nationwide Platforms Ltd Oct-17 Excelsior Park, Wishaw 112, years 8.76m 5.75% 78 Single let to the Royal Mail Group Sep-17 Houston Industrial Estate, Livingston 43,370 5 years 2.59m 7.50% 60 Single let to SCS Sep-17 2 James Street, Bellshill 52, years 4.125m 6.04% 78 Single let to HSS Hire Service Group and recently refurbished Aug-17 6 Brittain Way, Eurocentral 39, years % 83 Single let to DX Networks who recently extended SOUTH LUMLEY STREET GRANGEMOUTH

10 FURTHER INFORMATION TENURE Heritable interest (Scottish equivalent of English Freehold) CAPITAL ALLOWANCES All available capital allowances will be transferred to the purchaser. CONTACT VAT The property has been elected for VAT and therefore the sale will be treated by way of TOGC. ENERGY PERFORMANCE The property has an EPC Rating of C and a copy of the certificate can be provided on request. Ross Burns Charlie McNaught +44 (0) (0) (0) (0) ross.burns@eu.jll.com charlie.mcnaught@eu.jll.com INVESTMENT PROPOSAL Offers in excess of 2,165,000 (Two Million, One Hundred and Sixty Five Thousand Pounds Sterling), exclusive of VAT, are sought for our clients Heritable interest in the property. This reflects an attractive net initial yield of 8.50% and a capital rate of 50psf, assuming purchaser s costs of 5.85%. Crown Copyright All rights reserved. Promap licence number Jones Lang LaSalle licence number This plan is published for the convenience of identification only and although believed to be correct is not guaranteed and it does not form any part of any contract. Disclaimer - JLL for themselves and for the vendors or lessors of this property whose agents they are, give notice that:-a. the particulars are set out as a general outline only for guidance 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 believed to be correct, but any intending purchasers, tenants or third parties should not rely on them as statements or representations of fact but satisfy themselves that they are correct by inspection or otherwise; c. no person in the employment of JLL has any authority to make or give any representation or warranty whatever in relation to the property; d. Any images may be computer generated. Any photographs show only certain parts of the property as they appeared at the time they were taken. For properties in Scotland: e. This correspondence is expressly subject to completion of formal legal missives in accordance with Scots Law Copyright Jones Lang LaSalle IP Inc. September All rights reserved SOUTH LUMLEY STREET GRANGEMOUTH