UnitOne FOR SALE PRIME SINGLE-LET INDUSTRIAL INVESTMENT BALLIOL BUSINESS PARK, LONGBENTON, NEWCASTLE UPON TYNE NE12 8EW.

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1 BALLIOL BUSINESS PARK, LONGBENTON, NEWCASTLE UPON TYNE NE12 8EW On behalf of FOR SALE PRIME SINGLE-LET INDUSTRIAL INVESTMENT

2 BALLIOL BUSINESS PARK, LONGBENTON NE12 8EW INVESTMENT SUMMARY Situated in an established commercial location, approximately 4 miles north of Newcastle city centre Strategically located on Balliol Business Park, with excellent access to the A1 & A19 A detached industrial unit extending to 40,235 ft 2 Long Leasehold Interest with circa years unexpired Let to Royal Mail Group Limited (D&B rating of 5A1) on a 5 year lease until 30th November 2021, therefore providing an unexpired term of 4.69 years (2.69 years to break) Rack rent of 213,000 per annum, equating to 5.29/ft 2 We are instructed to seek offers in excess of 2,426,000 (Two Million, Four Hundred and Twenty Six Thousand Pounds) for our client s interest. A purchase at this price reflects a net initial yield of 8.25% assuming purchasers costs of 6.37% and offers a capital value of 60.30/ft 2 BALLIOL BUSINESS PARK, LONGBENTON, NEWCASTLE UPON TYNE NE12 8EW 1

3 LOCATION A1 North A19 North The City of Newcastle upon Tyne is located 451 km (280 miles) north of London and 175 km (109 miles) south of Edinburgh with direct connections to the A1(M), A19 and A69 which provides access onto the M6. Newcastle upon Tyne is the principal commercial centre in Tyne & Wear and is the regional capital of the North East of England and seventh largest city in the country. B6918 A696 A1 Newcastle International Airport A191 A191 A1 Newcastle United Golf Course A167 Gosforth A189 Great North Road Town Moor Newcastle Upon Tyne Newcastle Racecourse Balliol Business Park A189 Longbenton Heaton A1058 Jesmond A188 A191 A188 A188 Byker Quorum Four Lane Ends Wallsend A186 Rising Sun Country Park A186 A1058 A19 Cobalt A19 to Tyne Tunnel & South Newcastle is a major transport hub on the UK rail network with direct access to all major centres of population. The east coast mainline has a travel time of 2 hours and 50 minutes to London and less than 1 hour 30 minutes to Edinburgh. Scotland Glasgow Edinburgh Carlisle Manchester Liverpool Nottingham Wales Leeds Birmingham Cardiff Bristol Newcastle upon Tyne Sunderland Stockton-on-Tees England London Newcastle International Airport is the North East s major airport and offers regular scheduled services to many major UK and international destinations and is within 9 miles. Balliol Business Park is located at Longbenton, which is 4 miles to the north of Newcastle upon Tyne city centre adjacent to the A188 Benton Lane, which is approximately 2 miles equal distance between the A1 and the A19, both key road networks that provide access north / south in the region and onto the national motorway networks. Gateshead Tyne and Wear Metro BALLIOL BUSINESS PARK, LONGBENTON, NEWCASTLE UPON TYNE NE12 8EW 2

4 To A1(M) and A19 Junction A188 Country Style Foods Greggs Plc Quorum Business Park Vocare A188 Greggs Plc Leica Biosystems Greggs Plc Activ Technology Laing O Rouke Molekula Ltd Communisis To Newcastle City Centre Gosforth Business Park Ringtons For illustrative purposes only BALLIOL BUSINESS PARK, LONGBENTON, NEWCASTLE UPON TYNE NE12 8EW 3

5 SITUATION Balliol Business Park is a well-established industrial and office park with a number of well specified buildings throughout. The estate is predominately industrial throughout with office buildings towards the entrance to the estate. Occupiers on Balliol include Greggs, Ringtons, Communisis, Leica, Molekula Ltd, Vocare and Laing O Rourke. station (within 1 mile). Four Lane Ends metro station links to Newcastle Central Station, Newcastle International Airport and access to the wider National Rail Network. Quorum Business Park is situated on the opposite side of Benton Lane and comprises a Grade A office park built in 2008 extending to almost 1 million square feet with blue chip occupiers such as Balfour Beatty, Convergys, Sitel, British Engines, Home Group and Tesco Bank. Balliol Business Park is served by numerous public transport modes. There is a dedicated bus service which runs between the business park and Four Lane Ends metro BALLIOL BUSINESS PARK, LONGBENTON, NEWCASTLE UPON TYNE NE12 8EW 4

6 DESCRIPTION The warehouse has a solid concrete floor and an eaves height of 5.35m. The tenant has installed a number of mezzanine levels, providing storage areas which amount to a further 2,742 ft 2 of space. Externally the property has c. 54 car parking spaces at its north elevation and a concrete yard to the east, secured by a steel palisade fence. The yard is accessed from both the car park and the access road from within the business park. The subject property comprises a modern, detached industrial unit of steel portal frame construction with cavity brick, blockwork and profile metal sheet clad elevations beneath a pitched profile sheet roof. The office elevation comprises a mixture of brickwork, pre-fabricated metal cladding and aluminium powder coated glazing. Internally the building benefits from office accommodation to the front elevation set over two floors. There is a double height reception/entrance area, leading to a mixture of cellular and open plan office space, all to a modern specification. The remainder of the building is warehouse, providing production area, distribution and storage. The warehouse has two up and over shutter doors to its eastern elevation providing access to the external yard. BALLIOL BUSINESS PARK, LONGBENTON, NEWCASTLE UPON TYNE NE12 8EW 5

7 ACCOMMODATION SITE The property has been measured in accordance with the RICS Code of Measuring Practice (6th Edition) and provides the following Gross Internal Area: The property occupies a regular shaped site of approximately ha (2.384 acres) with a site coverage of c. 36%. M 2 FT 2 bridges s El Sub Sta Ground Floor Warehouse 2, ,231 Burnbank House Ground Floor Offices ,788 First Floor Offices ,215 TOTAL 3, ,234 0m 25m 50m 75m BALLIOL BUSINESS PARK, LONGBENTON, NEWCASTLE UPON TYNE NE12 8EW 6

8 TENURE The property is held long leasehold for a term of 150 years from 30th July 1997 at a rent of a peppercorn. Therefore providing an unexpired term of c years. TENANCY The property is fully let to Royal Mail Group Limited (Company No: ) sharing with their group company, Romec Enterprises Limited, on a 5 year lease from 1st December 2016, expiring on the 30th November 2021, at a passing rent of 213,000 per annum. Romec Enterprises Limited are a wholly owned Royal Mail Group Company. There is a tenant only break option at the third anniversary of the term subject to six months written notice. The tenant will benefit from four months rent free if they do not serve the break option. The lease is drafted on full repairing and insuring terms subject to a Schedule of Condition dated 13 August The lease is also outside of the Landlord and Tenant Act The current rack rent of 213,000 per annum, equates to 5.29/ft 2. BALLIOL BUSINESS PARK, LONGBENTON, NEWCASTLE UPON TYNE NE12 8EW 7

9 COVENANT STATUS Royal Mail Group Limited (Company No ) The last three years of accounts are as follows: Royal Mail Group Limited is the principal trading entity of Royal Mail Plc, a postal service company in the United Kingdom, originally established in The Royal Mail Group Ltd operated under Royal Mail for letters and Parcelforce Worldwide for parcels. General Logistics Systems is a Dutch, British owned logistics company based in Amsterdam, operating through 42 European countries and is a subsidiary of Royal Mail. Up until 2015, Royal Mail has been a public service, operating as a government department. Following the Postal Services Act 2011, the majority of the shares in Royal Mail were floated on the London Stock Exchange in The UK Government initially retained a 30% stake in Royal Mail, however it sold its remaining shares in Romec operate from the subject property and were formed in 1989 and stands for Royal Mail Engineering & Construction. It was established to deliver facilities maintenance services to the business and as of 2016 is wholly owned by Royal Mail. As well as facilities management, Romec through Serious Engineering also handle the manufacturing of a wide range of sheet metal and fabricated equipment including racking frames, trolleys, fabricated support frames, tables and enclosures. Romec also supplies various other industries including; food automation, defence, marine, oil & gas, chemical, amongst others. Royal Mail Group Limited represents a strong covenant with a Dun & Bradstreet rating of 5A1. Company Royal Mail Group Limited Company Year End Year End Turnover ( ) Pre-Tax Profit ( ) Shareholder s Funds ( ) 27/03/2016 7,675,000,000 99,000,000 4,093,000,000 29/03/2015 7,772,000, ,000,000 3,667,000,000 30/03/2014 7,782,000,000 1,519,000,000 2,132,000,000 BALLIOL BUSINESS PARK, LONGBENTON, NEWCASTLE UPON TYNE NE12 8EW 8

10 VAT EPC The property is not elected for VAT therefore VAT will not be charged on the purchase price. The unit has been assessed with a rating of C (68). Details can be provided on request. CONTACT Douglas Cranston e: douglas.cranston@knightfrank.com t: m: Dickon Wood e: dickon.wood@knightfrank.com t: m: PROPOSAL We are instructed to seek offers in excess of 2,426,000 (Two Million, Four Hundred and Twenty Six Thousand Pounds) for our client s interest. A purchase at this price reflects a net initial yield of 8.25% assuming purchasers costs of 6.37%. A purchase at this level equates to a capital value of 60.30/ft 2. Adam Greenwood e: adam.greenwood@knightfrank.com t: m: Charles Hobart e: charles.hobart@knightfrank.com t: m: Knight Frank LLP, St Ann s Quay, 124 Quayside, Newcastle upon Tyne NE1 3BD Misrep. Notice These particulars are not an offer or contract, nor part of one. You should not rely on statements by Knight Frank LLP in the particulars or by word of mouth or in writing ( information ) as being factually accurate about the property, its condition or its value. Neither Knight Frank LLP has any authority to make any representations about the property, and accordingly any information given is entirely without responsibility on the part of the agents, seller(s) or lessor(s). The photographs show only certain parts of the property as they appeared at the time they were taken. Areas, measurements and distances given are approximate only. Any reference to alterations to, or use of, any part of the property does not mean that any necessary planning, building regulations or other consent has been obtained. A buyer or lessee must find out by inspection or in other ways that these matters have been properly dealt with and that all information is correct. The VAT position relating to the property may change without notice. Knight Frank LLP is a limited liability partnership registered in England with registered number OC Our registered office is 55 Baker Street, London W1U 8AN, where you may look at a list of members names. March Designed & produced by Ref: CSD1064