West George Street. Glasgow G2 2LB PRIME MULTI-LET OFFICE INVESTMENT WITH ASSET MANAGEMENT OPPORTUNITIES ENTER

Transcription

1 West George Street G2 2LB PRIME MULTI-LET OFFICE INVESTMENT WITH ASSET MANAGEMENT OPPORTUNITIES ENTER

2 West George Street G2 2LB Investment Summary Prominent multi-let office building located in s CBD. Provides a total of 1, sq m (19,744 sq ft) of good quality open plan office accommodation arranged over lower ground, ground and seven upper floors. Asset management potential. Rents ranging from per sq ft. Heritable Interest (Scottish equivalent of English freehold). Seeking offers in excess of 2,800,000 exclusive of VAT reflecting a net initial yield of 9.90% assuming standard purchaser s costs based on LBTT.

3 UNION STREET Click the buttons below to navigate J18 COWCADDENS J19 CHARING CROSS STATION PITT STREET DOUGLAS STREET BOTHWELL STREET WATERLOO STREET ANDERSTON STATION ANDERSTON QUAY BROOMIELAW RENFREW STREET SAUCHIEHALL STREET BATH STREET WEST REGENT STREET BLYTHSWOOD STREET WEST GEORGE STREET WEST CAMPBELL STREET OSWALD STREET WELLINGTON STREET HOPE STREET CENTRAL STATION JAMAICA STREET BUCHANAN STREET WEST NILE STREET ARGYLE STREET ST ENOCH ST VINCENT STREET BUCHANAN STREET QUEEN STREET QUEEN STREET STATION Location one77 West George Street has a prominent position on the south side of West George Street between Wellington Street and Hope Street in the heart of s Central Business District. This city centre location provides excellent access to s public transport network. Central and Queen Street train stations are within a few minutes walk of the property, and subway stations such as Cowcaddens and Buchanan Street are also a short distance away. Additionally frequent bus services run along West Regent Street and Wellington Street. Road connections are excellent with easy access to the M8 and wider motorway network via junctions 18 and 19. one77 West George Street is ideally located in close proximity to s prime retail and leisure pitches including Buchanan Street and Sauchiehall Street.

4 Description one77 West George Street extends to approximately 1, sq m (19,744 sq ft) over lower ground, ground and seven upper floors with the benefit of a central atrium that extends the full height of the building. The building also has secure parking located at lower ground floor, which can be accessed via West George Lane. The accommodation comprises modern, open plan offices arranged in front and rear wings over ground to 6th floors, each with male and female toilet facilities accessed by a communal corridor. The 7th floor only extends over the front wing of the building but benefits from its own roof terrace and unisex toilet. The accommodation benefits from the following specification: Raised access floors Suspended ceilings Gas central heating Comfort cooling cassettes (in part) Dedicated male and female toilet facilities on each floor Refurbished communal areas Secure private parking Commissionaire 24 hour access 1 x 13 person passenger lift Disabled access

5 ST ENOCH CENTRE Surrounding Occupiers ST ENOCH 1 THE WEIR GROUP, CMS CAMERON MCKENNA, SHEPHERD & WEDDERBURN 2 PRINCES SQUARE 2 BRODIES, DELOITTE, ARMANI GRANT THORNTON, DWF GEORGE SQUARE CENTRAL STATION 3 CAPITA 4 LLOYDS BANKING GROUP 5 REGUS QUEEN STREET STATION BUCHANAN STREET STANDARD LIFE 7 RBS 8 CIGNA 9 SCOTTISH & SOUTHERN ENERGY 10 HYMANS ROBERSTON ASHURST 11 SCOTTISH ENTERPRISE GLASGOW SKYSCANNER, NETWORK RAIL 6 13 JP MORGAN 14 STUDENT LOANS COMPANY JACOBS ENGINEERING GROUP 16 UNITE THE UNION 17 CUSHMAN & WAKEFIELD 16 BLYTHSWOOD SQUARE

6 is Scotland s largest city with a population of nearly 600,000 and the third largest in the UK. The city has an extensive catchment of over 3 million people. There are 1.2 million eligible to work within a 45 minute commute of the city and 2 million within an hour. It is Scotland s largest centre of employment, specialising in sectors such as financial and business services, health, education, retail, tourism and hospitality. has a highly educated workforce with over 130,000 students attending the five higher education institutions and the three super colleges making it an attractive destination for business. contributes approximately 18 billion GBP in Gross Value Add to the Scottish economy annually and according to The Global Financial Services Index it is in the top 20 European Financial Centres. Almost 17,000 companies make their home in ; together they generate a turnover of 31,101 million GBP each year. is rapidly becoming a smart city of the future, positioning itself at the forefront of technology integration and application. The city benefits from an excellent road and rail network, with the M8 linking the city to Edinburgh in the east, the A80 / M80 to the north and the M74 to the south. It is also within an hour s drive of three international airports and is the only UK city out with London to have its own subway. The city also has an extensive public transport network offering frequent train and bus services. It is served by two main railway stations; Central and Queen Street. In addition to providing local services throughout central Scotland, these stations offer links to the main cities throughout the UK and all the major Scottish centres.

7 Accommodation The property has been measured in accordance with International Property Measurement Standards Three (IPMS 3) and with the RICS Code of Measuring Practice (Sixth Edition). We estimate the net internal areas to be as follows: Seventh Floor (Roof Terrace) AREAS (Sixth Edition) AREAS (IPMS 3) sq m sq ft sq m sq ft N/A N/A Seventh Floor , ,087 Sixth Floor , ,578 Fifth Floor , ,580 Fourth Floor , ,598 Third Floor , ,576 Second Floor , ,586 First Floor , ,570 Ground Floor , ,972 Lower Ground , ,466 TOTAL 1, ,744 1, ,308 The building also has the benefit of 4 dedicated secure car parking spaces. REAR SUITE FRONT SUITE WEST GEORGE STREET Typical Floor Plan

8 Tenancy Schedule Floor Tenant Floor Area (sq ft) Net Current Rent pa Rent psf Lease Expiry Lease Break Comments 7th Gilkes Energy 1,079 13, /03/ /01/2017 Schedule of condition. Service charge cap. If the break option is not served the tenant is to receive 6 months rent free. Lease guaranteed by Gilbert Gilkes & Gordon Limited. 6th (front) Royal College of Nursing 1,328 24, /03/2018 Includes 1 car parking space. 6th (rear) Rental Guarantee 1,219 18, year rent, rates & service charge guarantee. 5th (front) HSB Engineering Ltd 1,330 20, /03/ /03/2019 Paying half rent until 18/09/2016 Vendor will provide a rental top up until this date. Service cap charge. Rent review on 19/03/2019. If the break option is not served the tenant is to receive 6 months rent free. Includes 1 car parking space. 5th (rear) Bank of England 1,222 20, /03/2018 4th (front) Waterman s Solicitors Ltd 1,332 18, /01/ /01/2022 Schedule of condition. Paying half rent until 18/01/2017 Vendor will provide a rental top up until this date. If the break option is not served tenant pays half rent for 24 months. Rent review 19/01/22. 4th (rear) Rental Guarantee 1,238 18, year rent, rates & service charge guarantee. 3rd (front) CBA QS Ltd 1,318 21, /02/2020 Service charge cap. Includes 1 car parking space. 3rd (rear) Rental Guarantee 1,228 18, year rent, rates & service charge guarantee. 2nd Rental Guarantee 2,556 38, year rent, rates & service charge guarantee. 1st Rental Guarantee 2,514 40, year rent, rates & service charge guarantee. Includes 1 car parking space. Ground (Front) Rental Guarantee , year rent, rates & service charge guarantee. Ground (Rear) Rental Guarantee 1,161 15, year rent, rates & service charge guarantee. Lower Ground Energis Communications Ltd 1,446 15, /02/2017 Totals 19, ,694

9 Covenant Information The existing tenants have a mix of covenant strengths as shown below: COMPANY Experian Score out of 100 Credit Limited Risk Gilkes Energy Limited 25 3,300 High The Royal College of Nursing of the United Kingdom HSB Engineering Insurance Limited ,000 Below Average Risk 100 1,900,000 Very Low Risk Bank of England ,000,000 Very Low Risk Watermans Solicitors Limited 80 50,000 Below Average Risk CBA QS Limited 87 53,000 Low Risk Energis Communications Limited 28 15,000 Above Average Risk

10 Office Market In there was 533,647 sq ft of take up in the occupational market, the third best year since The occupational market improved after a subdued Q2 and Q3 in, an increase in grade A take-up pushed the Q4 volume to 207,000 sq ft, 58% above the five year average. The increase in grade A takeup was largely down to three deals: DWF, which took 18,350 sq ft at 110 Queen Street, KPMG, which took 40,000 sq ft at St Vincent Plaza, and CMS Cameron Mckenna, which took 21,000 sq ft at 1 West Regent Street. Occupier confidence is strong, particularly for smaller lot sizes, with 16 deals completed in Q4 alone under 3,000 sq ft with a number of further deals expected to be signed in Q1 which would contribute to a positive H1 performance in The office market has seen an increase in the number of smaller requirements that are ideally suited to take space at one77 West George Street. This strong demand from small-medium sized businesses for good quality Grade B accommodation provides good supply and demand dynamics for rental growth and lower incentive packages going forward. Key Leasing transactions: Building Tenant Area (sq ft) Date 1 West Regent Street Shepherd & Wedderburn 1 West Regent Street CMS Cameron McKenna 13,702 Q4 21,206 Q4 110 Queen Street DWF 18,350 Q4 St Vincent Plaza KPMG 39,705 Q4 110 Queen Street WSP Group 10,544 Q4 Pacific House Big Lottery Fund 12,142 Q4 Granite House House of Fraser 8,800 Q4 Quarterly Take-Up by Grade (sq ft) 400, , , , , , ,000 50, Queen Street St Vincent Plaza 1 West Regent Street Q Q Q Q Source: Cushman & Wakefield Q Q Q Q Q Grade A Grade B Grade C Five Year Average Q Q Q Q Q1 Q2 Q3 Q4

11 Investment Market Overview is a major regional office centre and attracts investment in commercial property from UK Institutions, overseas funds and high-net worth individuals. It is one of the top 6 regional cities in the UK with prime yields now at 5.25%. offers a discount in comparison to other regional cities, with yields in Birmingham and Manchester sitting at circa 5.00%. It was a record year for the office market in with 429m of investment transactions taking place compared with only 215m in The previous high was set in 2006 where 418m of office investments were transacted. Address Date Purchaser Price 389 Argyle Street 33 Bothwell Street Monteith House George Square 51 West Campbell Street March 2016 February 2016 November October Under Offer Asking 3.75m Net Initial Yield Asking 11.04% Capital Value psf 91 Cordatus 6.98m 6.62% 254 DRIP 5.75m 7.60% 212 Northwood Investors 12.8m 9.36% 225 Comment 40,979 sq ft, multi-let investment. 27,375 sq ft, six storey office building within IFSD. Tenants include Starbucks and Chase Devere. 27,000 sq ft, multi-let office investment. AWULT 5 years to expiry 4.09 to breaks. 56,771 sq ft, single let office investment to Bank of Scotland Plc. Lease expiring 2023, subject to tenants break option in Finnieston Street September Squarestone 6.45m 9.84% ,377 sq ft, multi-let office investment, with 34% vacancy. 163 West George Street September RWM Capital (Russia) 8.7m 6.50% ,947 sq ft, multi-let office investment. AWULT of 5.5 years to expiry. 140 West George Street September L&G 5.71m 6.75% ,883 sq ft, multi-let office investment. 180 West George Street August Picton UK 14.25m 7.80% ,099 sq ft, multi-let with AWULT of 2.55 years to breaks. 225 Bath Street August AEW 12.2m 10.00% ,827 sq ft, multi-let office investment with WAULT of 4.91 years to expiry. 180 St Vincent Street August Northwood Investors 11.9m 7.00% ,305 sq ft, multi-let office investment. AWULT of 4.36 years to expiries and 2.86 years to breaks.

12 VAT The property has been elected for VAT and therefore VAT will be payable on the purchase price. However it is anticipated that the sale will be treated as a Transfer Of a Going Concern (TOGC). West George Street G2 2LB Service Charge A copy of the service charge budget for 2016/2017 can be provided on request. EPC Proposal We are instructed to seek offers in excess of 2,800,000 (Two Million Eight Hundred Thousand Pounds Sterling) subject to contract and exclusive of VAT. A purchase at this level would reflect an attractive net initial yield of 9.90% assuming standard purchaser s costs based on LBTT. For further information or to arrange an inspection please contact: Copies of the EPC s are available on request. Tenure Heritable Interest (Scottish Equivalent of freehold). Stuart Low stuart.low@cushwake.com Stuart Spalding stuart.spalding@cushwake.com Cushman & Wakefield LLP on their own behalf and for vendors or lessors of this property, whose agents they are, give notice that: 1/ The particulars are produced in good faith, but are a general guide only and do not constitute any part of a contract. 2/ No person in the employment of the agent(s) has any authority to make or give any representation or warranty whatsoever in relation to this property. 3/ The property is offered subject to contract and unless otherwise stated all rents are quoted exclusive of VAT. 4/ Nothing in these particulars should be deemed a statement that the property is in good condition, or that any services or facilities are in working order. 5/ Unless otherwise stated, no investigations have been made regarding pollution, or potential land, air or water contamination. Interested parties are advised to carry out their own investigations if required. Publication Date: March 2016.