FREEHOLD LEISURE/OFFICE INVESTMENT 19 UPPER KING STREET, NORWICH NR3 1RB

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1 FREEHOLD LEISURE/OFFICE INVESTMENT 19 UPPER KING STREET, NORWICH NR3 1RB

2 Investment Summary Prominently located leisure / office investment within central Norwich's business and leisure district The property comprises 1, sq m (13,939 sq ft) on basement, ground and three upper floors Provides leisure use and a surveyors office on ground and basement with 2016 refurbished offices above Total income of 198,500 per annum 40% of income from Marstons Plc (D&B rating 5A1) until 2034 AWULT of 6.38 years (6.03 years to breaks) Offers in excess of 2,420,000 for the freehold interest, subject to contract and exclusive of VAT. This reflects a net initial yield of 7.71%, based on purchaser's costs of 6.36%. 2

3 A1 Luton M1 Peterborough A1 A14 Cambridge A1M King s Lynn A17 A10 M11 A11 Newmarket Stansted A47 A12 A1067 A11 A47 A14 A140 A140 Felixstowe Harwich A1042 NORWICH A47 Bury St. Edmunds Ipswich Norwich A47 A12 M25 LONDON Heathrow M25 The Forum UPPER KING ST The Property Location Norwich is a major East Anglian Cathedral City situated approximately 110 miles north of London, 60 miles north east of Cambridge and 40 miles north of Ipswich. The city had a resident population in 2011 of approximately 132,000 which is estimated to now be over 150,000 in 2018, and 250,000 within the Greater Norwich area and suburbs. The city has experienced significant development activity over recent years. Major projects include the regeneration of the Riverside area, completion of the Forum Library and Lendlease's major retail scheme at Chapelfield. Norwich is ranked 11th (2017 HDH) in the UKs top retail centres. CHAPELFIELD CITY CENTRE RETAIL SURREY ST. The A11 connects Norwich to Cambridge and the M11. The A140 provides a link to Ipswich and the A47 links Norwich to the A1 and the Midlands. There are two mainline rail services per hour to London's Liverpool Street station with a fastest journey time of 1 hour 40 minutes. Norwich International Airport offers regular flights to domestic and European destinations including Amsterdam Schiphol, Aberdeen, Edinburgh and Manchester. Norwich Research Park has a thriving community of over 80 businesses, 12,000 employees, 3,000 scientists, researchers and clinicians. Set in over 230 hectares of parkland and bolstered by the flow of skilled workers from the neighbouring University of East Anglia (17,000 students), Norwich has the facilities to attract leading occupiers in the Food and Health, Bioscience, Earth and Life Sciences sectors. 3

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5 COPA CABANA CAFE AROMA CAFE ST CUTHBERTS HOUSE RESIDENTIAL APARTMENTS Situation 19 Upper King Street is located in a prominent position on the corner of Upper King Street and Prince of Wales Road. This area of Norwich is characterised by estate agents and other professional services occupiers. Occupiers in the immediate vicinity include Bidwells, Savills, Humberts and Handelsbanken. The popular bar and restaurant area of Tombland is within a short walk. Nearby restaurant occupiers include Zizzi, La Tasca, Prezzo and All Bar One. The prime shopping areas of Gentleman's Walk and the Chapelfield Shopping Centre are easily accessible, as is Norwich railway station at the eastern end of Prince of Wales Road. The property's elevated position affords the upper floors impressive views of the Cathedral, located a short distance to the north, and the Castle, located to the south west, as well as views over the wider city centre area and the River Wensum. Not to scale, for indicative purposes only. 35

6 NORWICH CASTLE NORWICH UNIVERSITY OF THE ARTS THE PROPERTY UPPER KING STREET MILLS & REEVE SOLICITORS NORWICH MAGISTRATES COURT PRINCE OF WALES ROAD FOSTERS SOLICITORS ITV ANGLIA BIDWELLS NORWICH CATHEDRAL TOMBLAND HAYS ACCOUNTANCY NFU MUTUAL 6

7 Description The property comprises a five storey period building over basement, ground and three upper floors. The construction is a mix of traditional brick and stone and concrete façade under a flat roof. The ground and basement benefit from A3 consent with the ground floor currently fitted out as an American style sports themed bar trading as Stadia and the basement trades as The Dance Basement. The remaining ground floor and whole of the first floor provides an office occupied by Arnolds Keys, a long established Norwich based Chartered Surveyor and Estate Agent. There is a separate entrance on Prince of Wales Road which provides access to this space. The office entrance and second and third floor offices were refurbished in 2016, to include:- New air conditioning units New suspended ceilings and lighting New carpeting Secondary glazing Kitchenettes added Refurbished male / female WCs Refurbished lift (serves Ground to 3rd) These two floors are accessed via a separate entrance on Upper King Street, which leads to a separate large stair core, communal WC facilities and a passenger lift. Floor plans for the refurbishment are available upon request. Arnolds Keys Prosper Business Recruitment 37

8 First Floor Plan Second Floor Plan Third Floor Plan Suite D Suite C Suite F Suite E Not to scale, for indicative purposes only. 8

9 Tenure The property is held freehold as shown edged red on the plan. View from Suite F 39

10 Accommodation and Tenancy Schedule The property is let to four tenants on four leases with an AWULT of 6.38 years (6.03 years to breaks). The total income is 198,500 per annum based on the current income and top ups provided by the vendor for the two small vacant office suites and top ups for rent free periods. Please see the accommodation and tenancy schedule below:- Floor Use Tenant Name Floor Area Floor Area Lease Lease Next Review Rent PA Rent Comments... (sq m) (sq ft) Start Date End Date (Break) per sq ft Ground & Leisure Marstons PLC , Jul Jul Jul , Basement (assigned from , Greene King) Part Ground & Offices Arnolds Keys LLP Jun Jun , First ,077 Entirely underlet to ThreeKings Ltd from to at 70,000 pa. The ground floor trades as Stadia and the basement, The Dance Basement. Current lease expires Reversionary lease expires at the same rent, fixed to lease expiry, subject to a 6 month rent free period from 28/06/2018 until 27/12/2018 which the vendor will top up. Service charge cap in the lease. Second Offices Prosper Business , May /05/2023 Fixed uplifts 20, Rent free until 01/11/2018 to be topped... up by vendor.... Recruitment Ltd (08-May-2021) 14,750 pa until May ,000 pa to May ,000 to May The vendor will top up the rent to 20,000 to lease expiry. 3,500+VAT rent deposit. Recently refurbished. Offices Vacant - 12 month , Refurbished.... Suite D - guarantee South Wing Third Offices Clancy Consulting Ltd , Mar /03/ /03/ , (23-Mar-2021) Compounded... RPI increases Rent free until 01/08/2018 to be topped up by vendor. Service charge cap in lease. Recently refurbished. Offices Vacant - 12 month , Refurbished.... Suite F - guarantee South Wing... Total 1, , ,500 10

11 Marston Plc t/a Stadia - Ground Floor Marston Plc t/a The Dance Basement Clancy Consulting Ltd Tenant Covenants Marstons Plc (40% of income): Founded in 1890, Marstons is the UK's leading brewer of cask ales, producing more than 60 different varieties via 7 regional breweries. They operate 1,600 pubs nationwide, employ 14,000 people and are listed on the FTSE 250. Marstons Plc: 5A1 Fiscal Consolidated 30/09/2017 Tangible Net Worth 633,500,000 Net Current Assets (Liabilities) ( 114,500,000) Sales / Turnover 1,011,300,000 Profit Before Tax 100,300,000 Clancy Consulting Ltd (10% of income): Clancy Consulting Ltd was founded in 1972 and now has offices in 10 locations in the UK including London. The business provides a broad range of building construction services and was listed for the 8th time in the Building Employers Guide 2017 as one of the top 50 firms in the industry. Clancy Consulting Ltd: 2A1 Fiscal Consolidated 31/03/2017 Tangible Net Worth 1,974,891 Net Current Assets (Liabilities) 1,583,071 Sales / Turnover 311,400,910 Profit Before Tax 758,630 Arnolds Property Consultants LLP (27% of income): Arnold Keys is a long established Norwich firm of Chartered Surveyors. In addition to their Norwich head office they have a further 6 offices throughout Norfolk. They are the largest independent estate agency practice in Norfolk and have a D&B rating of C2. Prosper Business Recruitment Ltd (10% of income): A recruitment consultancy formed in 2010 with 10 employees focused on Norfolk, Suffolk, Cambridgeshire, Essex and London. They have a D&B rating of B2. Service Charge The annual service charge for 2017 was 34, with the service charge for 2018 at 29,408 as against the budget of 34,600. This reflects a rate of 2.11 per sq ft for the property. Norwich Office Market November 2017 recorded the first anniversary for the Cambridge Norwich Tech Corridor. The partnership was formed to help promote business and innovation along the A11 link road between the two cities, with the aim of stimulating 500m of new investment. The corridor is home to 23,838 digital tech jobs and is aimed at building upon the sector specialisms of software, data management, financial services, agri-tech, biotech and health/life sciences. Norwich office take up for 2017 was 167,100 sq ft, falling below trend levels for the first time in five years. There was a 66% reduction in grade A supply since Total supply now stands at 330,200 sq ft, the lowest level since This has had the effect of increasing growth in second hand space 45% since Prime rents currently stand at per sq ft and this is anticipated to grow to per sq ft by (Source: Bidwells - Our View on Norfolk / Suffolk Offices, Spring 2018). Suite F 311

12 Further Information Should you have any queries or wish to make a site inspection, please contact: Richard Walden DD: richard.walden@bidwells.co.uk Darryl Stevenson DD: darryl.stevenson@bidwells.co.uk Planning Permitted development consent was granted in July 2014 (now lapsed) for the conversion of the second and third floors from offices to 10 residential units. There may be additional scope to create a lightweight structure on top of the building to further increase the number of residential units, subject to obtaining the necessary consents. Prospective purchasers are advised to make their own enquiries. EPC Ratings The suites within the building have EPC ratings ranging from C-D, a full schedule is available on request. Capital Allowances The vendor will retain the capital allowances. VAT We understand that the property is elected for VAT. We anticipate that the transaction will be structured as a TOGC. Proposal Our client is seeking offers in excess of 2,420,000 for its freehold interest, subject to contract and exclusive of VAT. A purchase at this level would reflect a net initial yield of 7.71% based on purchaser s costs of 6.36%. Andrew Groves DD: andrew.groves@bidwells.co.uk Bidwells 25 Old Burlington Street London W1S 3AN Tel: July

13 Bidwells 25 Old Burlington Street London W1S 3AN Tel: bidwells.co.uk IMPORTANT NOTICE Bidwells LLP act for themselves and for the vendors of this property, whose agents they are, give notice that: Nothing contained in these particulars or their contents or actions, both verbally or in writing, by Bidwells LLP form any offer or contract, liability or implied obligation to any applicants, viewing parties or prospective purchasers of the property to the fullest extent permitted by law and should not be relied upon as statements or representative of fact. No person in the employment of Bidwells LLP or any joint agents has authority to make or give any representation or warranty whatever in relation to this property. Any areas of measurements or distances are approximate. The text, photographs and plans are for guidance only, may not be to scale and are not necessarily comprehensive. No assumptions should be made that the property has all necessary planning, building regulation or other consents. Bidwells LLP has not carried out a survey, nor tested the services, appliances or facilities. Purchasers must satisfy themselves by inspection or otherwise. All rentals and prices are quoted exclusive of VAT unless otherwise stated. Prospective purchasers may be asked to produce identification of the intended Purchaser and other documentation in order to support any conditional offers submitted to the vendors. Bidwells LLP accepts no liability of any type arising from your delay or other lack of co-operation. We may hold your name on our database unless you instruct us otherwise. OS licence no. ES Copyright Bidwells LLP Bidwells LLP is a limited liability partnership registered in England and Wales (registered number OC ). Registered office is Bidwell House, Trumpington Road, Cambridge CB2 9LD where a list of members is available for inspection. Your statutory rights are not affected by this notice.