UNITS 1-9 CENTRE COURT

Transcription

1 ASHVILLE TRADING ESTATE INVESTMENT OPPORTUNITY VALUE ADDED OFFICE INVESTMENT OPPORTUNITY 1 UNITS 1-9 CENTRE COURT Meridian North Meridian Business Park Leicester LE19 1WD * ACTIVE MANAGEMENT INVESTMENT * 35,045 SQ FT IN 9 OFFICE UNITS * 4 INCOME PRODUCING

2 INVESTMENT SUMMARY 2 Situated on Meridian Business Park, Leicester adjacent to Junction 21 M1. 9 office units totalling 35,045 sq ft - 5 void (18,219 sq ft) with 137 car parking spaces (1:256 sq ft). Multi-let to 2 tenants on 4 leases producing a current income of 191,205 pa, with a reversionary income of 341,690 pa on a conservative rent of 9.75 psf. WAULT approximately 4.04 years to expiries and 1.68 years to breaks. Numerous asset management opportunities to enhance the income profile, improve the WAULT and drive income returns. Units 2,3,4 let to ITS Testing Services (UK) Limited on assignment from ITS have occupied the space since Unit 9 let to East Midlands Ambulance Service NHS Trust since PROPOSAL We are instructed to seek offers in excess of 2,278,000 (two million, two hundred and seventy eight thousand pounds) subject to contract and exclusive of VAT based on a net rent of 191,205 pa. Assuming purchasers costs of 6.04%, this reflects the following: Net initial yield 6.93% Capital value psf ASSET MANAGEMENT OPPORTUNITIES Let the vacant space within Centre Court to enhance the income profile. Undertake a rolling refurbishment of the office accommodation to increase the rental tone. Unit 6 has been stripped and Unit 7 has been fully refurbished internally. Negotiate the removal of the break options in order to improve the WAULT. Break up potential. Enhance the branding to boost Centre Court s profile within the wider area. UNIT 7 - REFURBISHED

3 LOCATION 3 Leicester is the second largest commercial centre in the East Midlands, behind Nottingham and is located approximately 43 miles north east of Birmingham City Centre, 30 miles south of Nottingham and 14 miles north east of Hinckley. Meridian Business Park is strategically located adjacent to Junction 21 of the M1 motorway approximately 6 miles west of Leicester City Centre. Centre Court is situated within the established Meridian Business Park and is accessed off Meridian North. There are excellent transport links with Junction 21 M1/M69 motorway only 0.5 miles away and Leicester City Centre via the Narborough Road (A5460) approximately 3 miles away. DESCRIPTION Constructed in the late 1980s, Centre Court provides 9 hybrid / office units arranged in two terraces of a single storey office building which overlooks a landscaped car park. The offices are of steel frame construction and have panelled elevations with glazed frontages under a pitched roof CAR PARK Internally the property provides carpeted floors, suspended ceilings, recessed lighting, recessed air circulation units, kitchen and WC facilities The units in total measure 35,045 sq ft (NIA) ranging from 2,758-5,710 sq ft, with the ability to combine units to create bespoke sizes. A CBRE measured survey can be found in the data room. Units 2,3,4 and 9 are let. Unit 7 has been recently refurbished and includes new LED lighting, carpet tiles and new common areas. MARKET COMMENTARY Meridian Business Park, along with the adjacent Grove Park, attracts both regional and local office requirements, with occupiers including; BSS Group, Sytner Group and Howes Percival. Rental and capital values have strengthened during 2015 and 2016 due to strong demand for offices both within central Leicester and in the out of town Business Parks. Rents for prime office accommodation on Meridian Business Park and Grove Park range up to psf. Centre Court represents a discounted rent benefiting from open plan, single floor plate office accommodation with excellent car parking. UNIT 4

4 TENURE 4 Freehold. TENANCY UNIT TENANT AREA SQ FT LEASE START LEASE EXPIRY BREAK RENT ERV ( 9.75 psf) COMMENTS 1 Vacant 2,763 n/a n/a n/a n/a 26, Unrefurbished 10 car parking spaces (1:276 sq ft) 2 ITS Testing Services (UK) Limited 2,786 25/06/15 24/06/20 25/12/17 31,770 ( 11.40) 3 ITS Testing Services (UK) Limited 4,249 25/06/15 24/06/20 25/12/17 47,925 ( 11.28) 4 ITS Testing Services (UK) Limited 4,296 25/06/15 24/06/20 25/12/17 48,510 ( 11.29) 27, ITS have been in occupation since car parking spaces (1:348 sq ft) 41, ITS have been in occupation since car parking spaces (1:327 sq ft) 41, ITS have been in occupation since car parking spaces (1:358 sq ft) 5 Vacant 2,776 n/a n/a n/a n/a 27, Unrefurbished 9 car parking spaces (1:308 sq ft) 6 Vacant 2,758 n/a n/a n/a n/a 26, Unrefurbished 10 car parking spaces (1:276 sq ft) 7 Vacant 4,212 n/a n/a n/a n/a 41, Refurbished 13 car parking spaces (1:324 sq ft) 8 Vacant 5,710 n/a n/a n/a n/a 55, Unrefurbished 18 car parking spaces (1:317 sq ft) 9 East Midlands Ambulance Service NHS Trust 5,495 25/03/16 24/03/21 25/03/19 63,000 ( 11.46) 53, Let since car parking spaces (1:275 sq ft) TOTAL (NIA) 35, , , CAR PARKING SPACES An additional overflow car park is available to tenants comprising of 24 spaces. Overall 137 car parking spaces (1:256 sq ft). UNIT 7 - REFURBISHED UNIT4 UNIT 7 - REFURBISHED

5 COVENANT 5 East Midlands Ambulance Service (EMAS) NHS Trust The NHS was launched in It was born out of a long-held ideal that good healthcare should be available to all, regardless of wealth one of the NHS s core principles. With the exception of some charges, such as prescriptions, optical services and dental services, the NHS in England remains free at the point of use for all UK residents. This currently stands at more than 64.6 million people in the UK and 54.3 million people in England alone. The NHS in England deals with over 1 million patients every 36 hours. It covers everything, including antenatal screening, routine screenings (such as the NHS Health Check), treatments for long-term conditions, transplants, emergency treatment and end-of-life care. ITS Testing Services (UK) Limited (company number ) - (Tenant) UNIT 9 31 DEC DEC DEC 2012 Sales Turnover 111, , ,963 Pre-tax profit (6,541) 3,965 1,709 Net worth 354 (757) (8,783) ITS Testing Services (UK) Limited have a Dun and Bradstreet rating of A1 which represents a financial strength of 354,000 (based on a tangible net worth). UNITS 7-9 Intertek UK Holdings Limited (company number ) - (Guarantor) 31 DEC DEC DEC 2012 Pre-tax profit (28,348) (2,120) 1,040 Net worth (19,752) 15,550 17,754 Intertek is the industry leader with more than 40,000 employees in 1,000 locations in over 100 countries with 29 offices located in the UK. They hold extensive global accreditations, recognitions, and agreements, and that knowledge of and expertise in overcoming regulatory, market, and supply chain hurdles is unrivaled. UNITS 1-5 Reliable testing and certification for faster regulatory approval Through rapid, efficient entry to virtually any market in the world Total quality assurance across supply chain Through innovative leadership in meeting social accountability standards Reducing cost and minimizing health, safety, and security risks Becoming a trusted brand UNITS 1-6

6 EPC 6 The building has an EPC rating ranging from C75 - E123. SERVICE CHARGE There is a service charge payable by the tenants of Centre Court. The total service charge budget for the year ending 31 December 2016 is 25,030 which equates to psf. Further information can be found in the data room. VAT We are advised that the property has been elected for VAT. It is anticipated the sale shall be treated as a Transfer of Going Concern (TOGC). PROPOSAL We are instructed to seek offers in excess of 2,278,000 (two million, two hundred and seventy eight thousand pounds) subject to contract and exclusive of VAT based on a net rent of 191,205 pa. A sale at this level would provide a net initial yield of 6.93% and a reversionary yield of 12.38% based on an ERV of 341,690. Capital value psf. DATA ROOM Access to the data room is available on request. FURTHER INFORMATION For further information or to arrange an inspection, please contact: ROBERT RAE DAVID TEW robert.rae@avisonyoung.com david.tew@avisonyoung.com IMPORTANT NOTICE Avison Young (registration number OC ), their clients and any joint agents give notice that: (1) The particulars are set out as a general outline only for the guidance of intending purchasers or lessees and do not constitute part of an offer or contract; (2) All descriptions, (whether in text, photographs or plans) dimensions, references to condition and necessary permissions for use and occupation and their 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; (3) They are not authorised to make or give any representation or warranty whatever in relation to this property or these particular. AUGUST 2016