EXECUTIVE SUMMARY. Landmark Grade A office development in excellent city centre location.

Transcription

1

2 CONTENTS 02 // EXECUTIVE SUMMARY 04 // LOCATION & SITUATION 08 // MARKET OVERVIEW 11 // PROPERTY DESCRIPTION 14 // ACCOMMODATION 16 // TENURE 18 // TENANCIES / TENANCY SCHEDULE 20 // COVENANTS 23 // PLANNING / SERVICE CHARGE 24 // ENERGY EFFICIENCY / CAPITAL ALLOWANCES 27 // PROPOSAL / VAT 28 // VIEWING & FURTHER INFORMATION

3 DIGITAL CAMPUS SHEFFIELD // 3 EXECUTIVE SUMMARY Landmark Grade A office development in excellent city centre location. Prime and prominent location directly opposite Sheffield s recently refurbished Railway Station. Sheffield s most advanced office campus, at the centre of the ever-evolving digital sector. 49,243 sq ft (4,574.8 sq m) of Grade A office and ancillary accommodation arranged over 5 floors and benefiting from 54 parking spaces. Flexible floor plates of between 8,643 sq ft (803.0 sq m) and 10,604 sq ft (985.1 sq m). Fully let to strong covenant mix including BSkyB, Coal Pension Trustees, Kennedys Law and Michael Page. Average Weighted Unexpired Lease Term of 7.08 years to breaks and 8.61 years to expiries. Held long leasehold for 250 years at a peppercorn on a lease dated from 1st January Low capital value of 282 per sq ft. Total rent 1,036,211 per annum. We are instructed to seek offers of 13,900,000 (Thirteen Million Nine Hundred Thousand Pounds), subject to contract, for the long leasehold interest, which reflects a net initial yield of 7.05%, after allowing for the usual purchasers costs of 5.80%.

4 DIGITAL CAMPUS SHEFFIELD // 5 LOCATION & SITUATION Sheffield is England s fourth largest city and the commercial, administrative and retail centre of South Yorkshire, with an urban area population of SHEFFIELD UNITED FC COPTHORNE HOTEL approximately 640,000. The city is located 150 miles (240 km) north of London, 33 miles (53 km) south of Leeds and 38 miles (61 km) east of SHEFFIELD CITY COUNCIL Manchester and benefits from its central location within the UK, adjacent to the M1 Motorway. THE MOOR RETAIL DEVELOPMENT In recent years Sheffield has successfully transformed itself from a city dominated by its manufacturing base, to a service led economy. Major employers include HSBC, Santander, Halifax and Aviva. Outside of the JURY S INN financial sector, large offices have also been established by private sector companies including WANdisco, Nabarros, PWC, Plusnet, Irwin Mitchell and Sky. The city enjoys excellent access to the national motorway network, with Junctions 31 to 34 of the M1 on the eastern fringe of the city, approximately 4 miles (6.5 km) from the city centre. The M1 provides direct access to points north (Leeds, Barnsley and Wakefield) and south (Nottingham, Milton BLACKBURN A65 M65 YORKSHIRE DALES BURNLEY SKIPTON NIDDERDALE A59 LEEDS M1 A1 (M) YORK SELBY SHEFFIELD MAINLINE STATION Q PARK SHU STUDENT UNION ST PAUL S PLACE SHEFFIELD HALLAM UNIVERSITY WINTER & PEACE GARDENS LYCEUM & CRUCIBLE THEATRES Keynes and London). In addition, the M18, accessed at Junction 32 of the M1 provides direct access to the Humberside Ports. The A57 and M67 provide access to Manchester, approximately 38 miles (61 km) to the west. BURY M66 M62 ROCHDALE M62 M1 HUDDERSFIELD WAKEFIELD A1 (M) M62 GOOLE A61 BUS TERMINUS O2 ACADEMY M61 M60 M1 DONCASTER PARK HILL VENTANA HOUSE ODEON CINEMA MANCHESTER M67 PEAK DISTRICT ROTHERHAM SHEFFIELD M1 A1 (M)

5 DIGITAL CAMPUS SHEFFIELD // 7 Sheffield Mainline Station is less then 5 mins walk from Ventana House located to the east of the city centre and provides direct services to the following UK cities with approximate fastest journey times as below: Leeds 41 Minutes Manchester 52 Minutes Birmingham 65 Minutes Nottingham 47 Minutes Sheffield is investing over 1 billion in its city centre to enable it to grow even further. Established attractions such as the Winter Garden and the civic space around the City Hall are being joined by the proposed New Retail Quarter a 500 million retail and residential development and Sheffield Digital Campus. Aimed at providing creative, digital and technology-led companies with state-of-the-art business accommodation in an unbeatable location. Sheffield Digital Campus is at the heart of Sheffield s new future. The property benefits from the most prominent office location in the heart of Sheffield s City Centre approximately 100m from the entrance to Sheffield Railway Station. SHEFFIELD CITY COUNCIL VENTANA HOUSE FUTURE PHASES London (St Pancras) 126 Minutes Doncaster, Manchester, East Midlands and Leeds-Bradford International Airports are located 23 miles (37 km), 47 miles (76 km), 53 miles (85 km) and 45 miles (72 km) respectively and are all within 1 hours drive of the city. All provide a range of national, European and international services. It lies adjacent to the city s bus station and the vast majority of the city centre s amenities are within a 350m radius, including the core business district, the city s prime shopping area, the Crucible Theatre and the O2 Academy. Masterplanning is currently underway on the next development phase which will see approximately 150,000 sq ft of Grade A office constructed over a single or two buildings. FUTURE PHASES

6 DIGITAL CAMPUS SHEFFIELD // 9 MARKET OVERVIEW Take-up in Sheffield was strong in Q2 2014, following a prolonged period of subdued activity, and amounted to c.110,000 sq ft, a significant improvement over Q1 s 32,000 sq ft and marking the strongest quarterly total since Q Despite this excellent level of take-up, active demand remains strong at 225,000 sq ft in Q2, in line with Q1 and slightly above the level recorded during the same period in Sheffield saw 30 deals in H1 2014, including 10 deals involving Grade A space. The largest was a financial services company s freehold purchase of Milton House (40,000 sq ft). 60% of take-up in H1 was made up of Grade A accommodation, while Grade B accounted for 38% of take-up. The Sheffield office market has witnessed the loss of lower quality office floorspace to alternative uses, particularly the student housing sector. Landlords remain reluctant to refurbish and re-let secondary properties and these are being purchased by developers for conversion. Improving occupier demand and an absence of new completions are leading to a shortage of available modern accommodation. Available Grade A supply currently stands at 295,000 sq ft, down from 340,000 sq ft at the end of last year. Prime Grade A headline rents, currently standing at to per sq ft, are expected to remain broadly flat during the next 18 months. However, with a shortage of prime Grade A supply, rents are expected to rise going forward. The strength of the market is highlighted by the speculative development of building 3, St Paul s Place extending to 70,000 sq ft. During 2013/2014 UK investors have turned their focus from prime central London and South East offices to the UK regional markets. This reflects the economic recovery. The UK funds and increasing overseas investors were the most active buyers in H1 2014, attracted by the excellent fundamentals of the key regional cities. RECENT PRIME REGIONAL OFFICE TRANSACTIONS DATE ADDRESS PURCHASER TENANT TERM CERTAIN PRICE NIY CAPITAL VALUE Jun-14 Lisbon House Leeds Portman Estates Lloyds Banking Group 9.25 years 8.76m 5.58% 331 per sq ft Jun-14 5 St Philips Place Birmingham Cordea Savills SoS & Ground Floor Retail WAULT 7.10 years 38.0m 5.80% 473 per sq ft Mar-14 Crickhowell House Cardiff Middle Eastern Private National Assembly for Wales years 40.5m 5.37% 322 per sq ft Mar-14 The Paragon Bristol Lothbury IM Multi-Let WAULT 6 years 29.45m 5.93% 389 per sq ft Feb-14 Sovereign House Leeds Private Overseas Individual Addleshaw Goddard 2.5 years 20.0m 7.95% 248 per sq ft Jan-14 Capella Glasgow Invesco Multi-Let WAULT 8 years 43.0m 5.50% 396 per sq ft

7 DIGITAL CAMPUS SHEFFIELD // 11 PROPERTY DESCRIPTION Sheffield Digital Campus will ultimately consist of 400,000 sq ft of grade A office space over three phases each phase will be distinctive yet all three share the same careful master planning as well as the most prominent location in Sheffield. Sheffield Digital Campus, at the heart of a multi-modal transport interchange, is adjacent to the refurbished Sheffield Railway Station and the city s bus terminal. It is ideally placed to offer staff highly convenient access to the workplace. Ventana House, provides 49,243 sq ft (4,574.8 sq m) over five floors plus undercroft accesscontrolled car parking. The building offers high specification office accommodation for companies looking for efficient workspace. The building specification includes the following: BREEAM rating Very Good. Flexible floor plates, easy to sub-divide. Impressive ground floor reception with full height atrium. Undercroft car parking with 54 spaces. Raised access floors throughout. Suspended ceilings. VDU compatible lighting. Comfort cooling. 24 hour access. Fully DDA compliant.

8 DIGITAL CAMPUS SHEFFIELD // 13

9 DIGITAL CAMPUS SHEFFIELD // 15 ACCOMMODATION LOWER GROUND FLOOR SQ FT SQ M Ground Floor 8, First Floor 8, Second Floor 10, Third Floor 10, Fourth Floor 10, Reception TOTAL 49,243 4, The property occupies a site of 0.74 acres (0.30 hectares). UPPER GROUND TYPICAL UPPER FLOOR RECEPTION

10 DIGITAL CAMPUS SHEFFIELD // 17 TENURE Long Leasehold. The property is held under a lease for a term of 250 years from 01/01/2006 at a Peppercorn. The purchaser will also acquire a share within the Management Company that controls the common parts of the whole of Sheffield Digital Campus Phase 1. The parking is demised within the long leasehold interest and is effectively operated by the Management Company with appropriate rights of way for relevant access.

11 DIGITAL CAMPUS SHEFFIELD // 19 TENANCIES TENANCY SCHEDULE The property is multi-let to four office tenants on effective FRI leases and benefits from an Average Weighted Unexpired Lease Term of 7.08 years to breaks and 8.61 years to expiries. UNIT / SUITE / FLOOR TENANT USE FLOOR AREA (SQ FT) TERM (YEARS) LEASE START LEASE EXPIRY REVIEW DATE BREAK RENT (PER ANNUM) 13 car parking spaces are currently unlet. The vendor will provide a 3 year rental guarantee in respect of these spaces. The office accommodation has a rateable value equivalent to per sq ft with the tenants covering the full liability. Part Ground Michael Page Holdings Ltd Office 2, /3/ /3/ ,208 Comments Demise includes 3 car parking spaces. Part Ground Coal Pension Trustees Services Ltd Office 5, /4/ /12/2021 1/10/ ,246 Comments Demise includes 6 car parking spaces. 1st, 2nd & Part 3rd Floor British Sky Broadcasting Ltd Office 23, /2/2011 6/2/2022 7/2/2017 6/2/ ,857 Comments There is a Tenant s option to break on 6th February 2017 upon 12 months written notice. A penalty sum of 794, (equivalent to 1.67 years rent) is payable by the tenant if the break is operated. Demise includes 14 car parking spaces. Part 3rd & 4th Floor Kennedys Law LLP Office 16, /7/ /6/2026 1/7/ ,400 Comments Demise includes 18 car parking spaces. Rental Guarantee 13 Car Parking Spaces Vacant Parking /8/ /7/ ,500 Comments 3 year rental 1,500 per parking space per annum. TOTALS 49,008 1,036,211

12 DIGITAL CAMPUS SHEFFIELD // 21 COVENANTS British Sky Broadcasting Ltd (Company No ) Michael Page Holdings Ltd (Company No ) Kennedys Law LLP (Company No OC353214) Coal Pension Trustees Services Ltd (Company No ) Operation and distribution of 24 wholly owned television channels via Michael Page Holdings Ltd provides IT, property and other services to Kennedys, a top 50 law firm, is a specialist national and international Coal Pension Trustees Services Ltd is owned jointly by The Mineworkers direct to home (DTH) services including Sky Première, Sky Comedy, Sky companies within the Michael Page group. Michael Page is one of the legal firm with expertise in litigation and dispute resolution. Pension Scheme (MPS) and British Coal Staff Superannuation Scheme Action, Sky Classic, Sky Modern, Sky Movies HD1-HD2, Sky Sports 1-2-3, world s leading recruitment companies and a constituent of the FTSE250 (BCSSS) and is responsible for providing administration services to Sky Sports Extra, Sky One, Two, Three, Sky News, Sky Sports and News. index. It provides specialist services across a broad range of sectors and They have over 900 employees globally, across nine UK and eight these schemes. Both schemes are former British Coal Pension Schemes It is fully owned by the Holding Company British Sky Broadcasting job types and has 155 offices in 36 countries. international locations. which between them have 430,000 members and together represent the Group Plc. For more information please visit the website second largest funded pension scheme in the UK. It has developed an in-depth knowledge of the recruitment market Their lawyers provide a range of specialist legal services for many The company has a D&B Rating of 5A1, indicating a minimal risk of to provide clients and candidates with an invaluable insight into the industries including: insurance/reinsurance, healthcare, construction, The two Schemes were closed to new members upon the privatisation of business failure. specialist areas in which it operates. For more information please visit employment, rail sectors, maritime and international trade - with a the British Coal Corporation in 1994 when they were set up as separate the website particular focus on dispute resolution and litigation. independent trusts. Coal Pension Trustees Services Ltd has a Graydon A summary of the most recent accounts follows: credit rating of 4A / excellent representing a low risk of business failure. A summary of the most recent accounts follows: For more information please visit the website For more information please visit the websites and DATE OF ACCOUNTS 30/06/ /06/ /06/2011 DATE OF ACCOUNTS 30/04/ /04/ /04/2011 DATE OF ACCOUNTS 31/12/ /12/ /12/2010 Turnover 6,985,000,000 6,548,000,000 6,259,000,000 Turnover 110,696, ,927,000 93,626,000 Turnover 37,879,000 29,208,000 28,109,000 Pre Tax Profit 1,031,000, ,000, ,000,000 Pre Tax Profit 20,642,000 19,755,000 18,196,000 Pre Tax Profit - 2,779,000 5,775,000-4,780,000 Net Worth 1,624,000,000 1,710,000,000 1,644,000,000 Net Worth 24,748,000 15,670,000 19,896,000 Net Worth 1,633,000 8,534, ,000

13 DIGITAL CAMPUS SHEFFIELD // 23 PLANNING The property benefits from planning consent for B1 Offices under the Town and Country Planning (Use Classes) Order SERVICE CHARGE The service charge year runs to 29th September. The current year s budget for the office parts is 272,980 per annum. There is a further 103,083 per annum payable for the services provided to the whole of the Digital Campus, of which 40,751 per annum is currently allocated to Ventana House.

14 DIGITAL CAMPUS SHEFFIELD // 25 ENERGY EFFICIENCY A carefully considered approach was employed in the construction of the building with particular attention paid to ensuring that its occupants enjoyed the benefits of an energy efficient design. The building has achieved a BREEAM Certification of Very Good. The building has a Energy Performance Rating of B and a score of 38. A copy of the Energy Performance Certificate is available on request. A 30% improvement on current building regulation design standards, achieved through the provision of an energy efficient envelope, heating, cooling and lighting systems. A predicted electrical consumption of 76kWh/m2. The Energy Consumption Guide 19, Energy Use in Offices states that good practice electrical energy consumption is 128kWh/m2, thereby demonstrating that Ventana House may consume 52kWh/m2 less than the good practice level (assuming a standard office occupier). CAPITAL ALLOWANCES Capital Allowances may be available to the purchaser. More information can be provided on request.

15 DIGITAL CAMPUS SHEFFIELD // 27 PROPOSAL We are instructed to seek offers of 13,900,000 (Thirteen Million Nine Hundred Thousand Pounds), subject to contract and exclusive of VAT, for the Long Leasehold interest, which reflects a net initial yield of 7.05%, after allowing for the usual purchaser s costs of 5.80%, and a capital value of 282 per sq ft. The above is on the basis that the Vendor tops up the rent to the full contractual level and includes a rental guarantee in respect of the car parking spaces. VAT The property is elected for VAT. It is envisaged that the sale will be structured as a Transfer of a Going Concern (TOGC) and as such VAT should not be payable.

16 VIEWING & FURTHER INFORMATION For further information or to arrange an inspection please contact: Mike Tench Lambert Smith Hampton UK House, 180 Oxford Street London, W1D 1NN Henrie Westlake Knight Frank 9 Bond Court Leeds, LS1 2JZ henrie.westlake@knightfrank.com Ben Roberts Lambert Smith Hampton 3 Hardman Street, Spinningfields Manchester, M3 3HF broberts@lsh.co.uk Robert Hepworth Knight Frank Fountain Precinct, 7th Floor, Balm Green Sheffield, S1 2JA robert.hepworth@knightfrank.com Misrepresentation Act 1967: Lambert Smith Hampton Group Limited and its subsidiaries ( LSH ) and Knight Frank for themselves and for the seller or landlord of the property whose agents they are give notice that: (i) These particulars are given and any statement about the property is made without responsibility on the part of LSH, Knight Frank or the seller or landlord and do not constitute the whole or any part of an offer or contract. (ii) Any description, dimension, distance or area given or any reference made to condition, working order or availability of services or facilities, fixtures or fittings, any guarantee or warrantee or statutory or any other permission, approval or reference to suitability for use or occupation, photograph, plan, drawing, aspect or financial or investment information or tenancy and title details or any other information set out in these particulars or otherwise provided shall not be relied on as statements or representations of fact or at all and any prospective buyer or tenant must satisfy themselves by inspection or otherwise as to the accuracy of all information or suitability of the property. (iii) No employee of LSH or Knight Frank has any authority to make or give any representation or warranty arising from these particulars or otherwise or enter into any contract whatsoever in relation to the property in respect of any prospective purchase or letting including in respect of any re-sale potential or value or at all. (iv) Price or rent may be subject to VAT and any prospective buyer or tenant must satisfy themselves concerning the correct VAT position. (v) Except in respect of death or personal injury caused by the negligence of LSH, Knight Frank or their employees or agents, LSH and Knight Frank will not be liable, whether in negligence or otherwise howsoever, for any loss arising from the use of these particulars or any information provided in respect of the property save to the extent that any statement or information has been made or given fraudulently by LSH or Knight Frank. (vi) In the case of new development or refurbishment prospective buyers or tenants should not rely on any artists impressions or architects drawings or specification or scope of works or amenities, infrastructure or services or information concerning views, character or appearance and timing concerning availability or occupation and prospective buyers or tenants must take legal advice to ensure that any expectations they may have are provided for direct with the seller or landlord and LSH and Knight Frank shall have no liability whatsoever concerning any variation or discrepancy in connection with such matters. August Designed by