For Sale. Hunts Court, Corporation Street, Taunton, Somerset. Leisure Investment Opportunity

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1 For Sale Hunts Court, Corporation Street, Taunton, Somerset Leisure Investment Opportunity

2 Hunts Court, Corporation Street, Taunton, Somerset 02 Investment Summary Prominent and attractive neo-classical building Freehold Excellent town centre pitch Upper and lower ground floor restaurant totalling circa 5,624sq ft. 15 year unexpired term to Loungers Limited without breaks at a topped up rent of 75,000pa 1st and 2nd floor apartments are sold off long-leasehold Total rent passing is 75,800pa Offers sought in excess of 1,060,000 reflecting a net initial yield of 6.75%.

3 Hunts Court, Corporation Street, Taunton, Somerset 03 Location and Situation Location Taunton is the county town of Somerset with a population of approximately 122,400 and a catchment of 350,000. Taunton is located 153 miles west of central London, 49 miles north of Bristol and 36 miles north east of Exeter. The town is well placed, being within 2 miles of junction 25 of the M5 motorway on the A358. The A358 provides links between the M5 and A303/A30 trunk roads. There is a regular mainline rail service to London Paddington in approximately 1 hour and 15 minutes and both Bristol & Exeter International Airports are within 45 minutes drive. Taunton is Somerset s largest town and is the counties administrative, retail and financial centre with major employers including UK Hydrographic Office, Charity Commission, Weston Provident Association and Musgrove Park Hospital. Situation Corporation Street is within the town centre, just off the High Street linking into East Street (A3027) within the principle shopping area of the town. Occupiers in the immediate vicinity include Pitcher & Piano, estate agents and recruitment agencies. Hunts Court is close to the town s retail and financial amenities and approximately 1 mile from the railway station. The property itself is prominently situated and improvements to the Castle Green area of the town, linking to Corporation Street opposite the Property and the completion of the Third Way road improvements, will greater improve the pitch. Across the green is the picturesque Castle (now a museum) and the renowned Castle Hotel. The Old Library building and municipal buildings lead through to the vibrant town centre. Taunton offers an excellent range of shopping and leisure facilities, including many restaurants and a theatre. The town s retail centre is home to many internationally known brands.

4 Hunts Court, Corporation Street, Taunton, Somerset 04 Description and Accommodation Description Hunts Court is a prominent landmark building originally commissioned in the 18th Century and completed in 1905, as a School of Art for the county of Somerset. The conversion of this building to residential apartments with a ground floor restaurant was part of Taunton Deane Borough Council s regeneration project. The accommodation is arranged on upper and lower ground floors. Internally, the upper and lower ground floors have been extensively fitted out by the current tenant with restaurant, bar, kitchens and ancillary accommodation. The upper floors comprise of seven apartments which are sold off long leasehold. The Property is Grade II listed and within the Castle Green/Bath Place conservation area. Accommodation The property comprises the following approximate net internal floor areas: Floor Use ft 2 m 2 Restaurant, Lower Ground Floor ancillary and 3, stores Wine bar and Upper Ground Floor 2, restaurant Upper Floors Not measured Total 5, Floor Plans Available upon request. *Red Line plan for indicative purposes only.

5 Hunts Court, Corporation Street, Taunton, Somerset 05 Tenancy Information Tenancy The ground floor restaurant is let to Loungers Limited. The original lease dated 26 March 2010 was due to expire in 2025 and was drawn on effective FRI terms at an initial rent of 50,000pa, however the lease is being regeared on the following terms: Lease extended to 25 March 2030 offering a 15 year clear unbroken term on the following stepped rental basis: Taunton Leisure Market Taunton has a vibrant town centre and leisure market. There are a wide range of restaurants and bars catering for the day and night time economies including Pizza Express, Nando's, Zizzi and Prezzo, whilst Bills will shortly be opening in Fore Street, Wildwood are moving into the Market House and an established restaurant operator are soon to open in the old Post Office in North Street, all being attracted to this busy county town. Year 1 Year 2 Year 3 52,500pa (equivalent to 70,000 less 3 months rent free) 53,250pa (equivalent to 71,000 less 3 months rent free) 72,000pa Rental evidence includes: Prezzo Nandos 25A Fore Street 1/5 The North Street 74,000 pa for 3,475 sq per sq. ft. overall 70,000 pa for 3,486 sq per sq. ft. overall Year 4 73,000pa Zizzi's Magdalene Lane 98,538 pa for 5,162 sq per sq. ft. overall Year 5 74,000pa The 2020 rent review is an open market review subject to a minimum uplift to 75,000pa. The vendor will top up the rent to 75,000pa from completion. The seven upper floor apartments are all sold off on 125 year long leases at a fixed ground rent of 150pa per apartment, generating a total of 1,050pa. Each lease contains fixed rental uplifts, increasing the rent by 150 every 10 years. There is a licence fee of 250pa payable to the council for the fire escape to the rear of the property. In addition, Wildwood have recently completed a lease on Market House on a stepped rental basis averaging 115,000pa reflecting per sq ft overall and we understand that Bills have taken a unit on East Street at 85,000pa reflecting an even higher rent per sq ft overall. With the Loungers rent reflecting per sq ft overall we believe that there are good prospects for growth. The combined net rent roll for the property is 75,800pa.

6 Hunts Court, Corporation Street, Taunton, Somerset 06 Covenant Covenant Loungers Limited Loungers is an innovative chain of all-day café bars operating from over 50 bars and restaurants nationwide. The business was started in 2002 by three individuals in Bristol, a city that now supports a total of six Lounges. A second chain, Cosy Club, has been developed to offer customers a similar solution in city centres, with sites now opened in Bath, Cardiff, Salisbury, Taunton, Stamford and Exeter. The period to April 2014 saw sustained growth with the Lounge concept continuing to thrive and 12 new Lounges opening. Lounger s presence in the North West increased significantly with 5 new sites and a further 3 sites in the South West were opened. Lounger s saw impressive growth in this period with increased sales of 5.1%; revenue increased by 11.58m to 33.73m, net sales grew by 52.3% and shareholder s funds increased to 3.29m from 2.12m. Loungers has continued to outperform the UK hospitality sector and the brands ability to trade at breakfast, lunch and dinner, seven days a week sets the business apart from other multiple operators. The Creditsafe rating is 76/100, representing a very low risk of business failure. The three year headline financial figures are below: Date 27/04/14 28/04/13 30/04/12 Turnover 33,730,594 22,148,754 15,065,197 Pre-tax profit 1,276,477 1,053, ,714 Net Worth 3,290,594 2,115,516 1,076,042

7 Hunts Court, Corporation Street, Taunton, Somerset 07 Proposal We are seeking offers in excess of 1,060,000 (One Million and Sixty Thousand Pounds), subject to contract and exclusive of VAT. A purchase at this level would reflect a net initial yield of 6.75% assuming purchaser s costs at 5.8%. Tenure Freehold EPC The building has an EPC rating of D 76. A copy of the certificate is available on request. VAT The commercial element of the property is elected for VAT however we anticipate the sale will be treated as a Transfer of a Going Concern (TOGC).

8 Hunts Court, Corporation Street, Taunton, Somerset 08 Contact and Viewing Arrangements Viewing Arrangements For further information or to arrange an inspection please contact the joint agents. Alder King Property Consultants Pembroke House 15 Pembroke Road Clifton Bristol BS8 3BA Oli Stretton Lucy Round Greenslade Taylor Hunt 9 Hammet Street Taunton Somerset TA1 1RZ Duncan Brown duncan.brown@gth.net Tony McDonnell tony.mcdonnell@gth.net SUBJECT TO CONTRACT & EXCLUSIVE OF VAT OJS/LR/March2015/81202 Important: Alder King for themselves and for the vendors of this property, whose agents they are, give notice that: 1. The particulars contained herein are for guidance purposes only and do not constitute either part or whole of an offer or contract. 2. All descriptions, dimensions, references to condition and necessary permissions for use and occupation 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, and must satisfy themselves as to their correctness. 3. No person in the employment of Alder King has any authority to make or give any representations or warranties whatsoever in relation to these properties. 4. No responsibility can be accepted for expenses incurred by intending purchasers in inspecting and considering the properties which are offered. Under the Control of Asbestos Regulations 2006 (CAR 2006), the owner or tenant of the property, and anyone else who has control over it and/or responsibility for maintaining or repairing it, may be under a statutory obligation to detect and manage any asbestos or asbestos related compounds contained within the property. Failure to comply with the CAR 2006 is an offence and could adversely affect the value of the property. The detection and management of asbestos and asbestos related compounds is beyond the scope of our expertise and does not form part of the services that we have agreed to provide in respect of the property. Accordingly: 1. Alder King do not accept any responsibility for, and you should not place any reliance on us in respect of, the detection and/or management of any asbestos and/or asbestos related compounds contained in the property. 2. We strongly recommend that you obtain advice from specialist environmental consultants in respect of asbestos related issues.