OLYMPIC COURT. Montford Street, Salford, M50 2QP. Prime Greater Manchester Reversionary Multi-Let Industrial Investment

Transcription

1 OLYMPIC COURT Montford Street, Salford, M50 2QP Prime Greater Manchester Reversionary Multi-Let Industrial Investment

2 INVESTMENT SUMMARY Prime multi-let industrial estate in Salford Quays, just 2 miles west of Manchester city centre and 0.5 miles from MediaCity UK. Excellently situated with easy access to both the A57 ring road and M602, connecting occupiers to the M60 and Manchester city centre, as well as the wider national motorway network. Self-contained multi-let estate totalling five units extending to approximately 108,639 sq ft. Fully let to two tenants with a total headline rent of 532,718 per annum, reflecting a low average rent of 4.90 per sq ft. 72% of income secured against Mettler-Toledo Safeline Limited, who have had a presence on the estate for 25 years and have a Dun & Bradstreet rating of 5A1. Attractive WAULT of 5.88 years to break and 7.27 years to expiry. Freehold We are instructed to seek offers in excess of 8,685,000 subject to contract and exclusive of VAT. A purchase at this level would reflect a net initial yield of 5.75% and a low capital value of 80 per sq ft, after deducting purchasers costs of 6.68%, with an attractive reversionary position. 2

3 MAP KEY 10 1 Olympic Court, Salford 2 Co-Op Data Centre 3 Howdens Joinery 4 Tiles UK 5 GE Robinson & Co 6 JTB Supplies 7 Batleys 8 BUPA 9 Lowry Outlet 10 Old Trafford 11 The Lowry 12 BBC Studios 13 Imperial War Museum 14 ITV Studios 15 Booths 16 Aston & Fincher A5186 SOUTH LANGWORTHY RD M602

4 A19 A65Prime Greater Manchester Reversionary Multi-Let A61 Industrial Investment MANCHESTER OVERVIEW Economy Greater Manchester is set to outperform London with predicted growth of 2.4% per annum until Job Creation Levels of job creation in Manchester are forecast to outpace Berlin, Tokyo and Paris over the next 5 years. Labour Pool 7.2 million people within an hour s commute of Manchester city centre. Population Increasingly, people are wanting to live and work in Manchester city centre, making it one of the youngest cities in Europe with an average age of just 33 years old. Graduates Manchester city region has four universities and a total student population A5 of 105,000 one of the largest in Europe. M6 Blackpool M55 Preston Blackburn A565 M58 Wigan M57 Knowsley M53 Runcorn M62 Widnes M56 A34 A59 Harrogate York A1M A59 A19 M55 a666 Southport M6 M66 M61 Bolton LIVERPOOL BRADFORD a646 Halifax M62 M62 A6033 M62 Huddersfield M1 Oldham Barnsley Doncaster M18 A628 OLYMPIC COURT MANCHESTER M60 Rotherham Stockport A623 M18 A1M A631 A49 M1 Chester Chesterfield A60 A614 M6 A523 A494 A34 A515 A6 A41 A61 Crewe A523 Wrexham Stoke-on-Trent A483 A5 A495 A52 LEEDS SHEFFIELD NOTTINGHAM SALFORD QUAYS A483 Salford Quays is an established industrial, office, residential, leisure and cultural centre located less than 3.2km (2 miles) west of Manchester city centre. The areas connectivity to the city centre and beyond (by tram, rail and car) has helped establish Salford Quays as a key extension of Manchester city centre, which is set to drive further occupational demand and underpin the area as an important industrial/trade and office location. A458 BIRMINGHAM Loughborough LEICESTER Phase 2 of MediaCityUK is now underway as part of a 1bn expansion, which will create an extra 2.3m sq ft of space, including 1,400 residential units, two Grade A offices, a 330 bed hotel and a wealth of retail/leisure accommodation. COVENTRY 4

5 CONNECTIVITY SITUATION BY CAR BY TRAIN Olympic Court is accessed via Montford Street and is situated in Salford Quays, 2 miles to the west of Manchester City centre and 0.5 miles from MediaCityUK. M602 (Junction 2) A57 M60 (Junction 12) M62 (Junction 12) 0.4 miles 1.7 miles 4.0 miles 4.5 miles Manchester Piccadilly Liverpool Lime St Birmingham New St London Euston 10 mins 46 mins 1hr 40 mins 2 hrs 30 mins Olympic Court benefits from excellent road communications being within 0.4 miles of the M602, which in turns provides access to the regional and national motorway networks including the M60 Manchester Outer Ring Road, M6, M56, M61 and M62 motorways. BY METRO MediaCityUK Old Trafford Manchester Piccadilly 5 mins 20 mins 23 mins BY AIR Manchester Airport Liverpool Airport Birmingham Airport 12 miles 31 miles 100 miles Manchester Airport 55 mins London Heathrow 200 miles SALFORD A6 KEY SURROUNDING OCCUPIERS M602 A5186 OLYMPIC COURT A5063 A57 KANSAS AVE SOUTH LANGWORTHY RD VERE STREET W ASHTON ST MONTFORD STREET A57 A5063 DALLAS CT DAKOTA AVE BROADWAY THE QUAYS A506 5

6 DESCRIPTION SITE The site is well configured and extends to approximately 4.74 acres, reflecting a low site cover of c.46%. Minimum Eaves Height 6m Unit Sizes 10,044-29,854 sq ft Total Area 108,639 sq ft Steel Portal Frame Construction High Spec Offices Two storey recently refurbished office content Fully Secure Site Enclosed via a gated perimeter fence 6 6

7 SERVICE CHARGE TENURE The current service charge budget amounts to 36,700 p.a. ( 0.34 psf) for the year ending 31 December Freehold TENANCY SCHEDULE The property comprises five units and is currently let to two tenants with a total rental income of 532,718 per annum ( 4.90 per sq ft), and an attractive WAULT of 5.88 years to break and 7.27 years to expiry. Mettler Toledo Safeline Limited, who account for 72% of income and have been in occupation at Olympic Court for over 25 years, have recently agreed a new reversionary five year lease expiring in August 2024, demonstrating their continued commitment to the location. We consider Olympic Court to provide significant reversionary potential. Tenant Unit Unit Size Lease Start Lease End Break date Rent Review Passing Rent (p.a) Rent (psf) Mettler-Toledo Safeline Limited ,044 22/09/ /08/2024* 27/08/ , Mettler-Toledo Safeline Limited ,241 17/07/ /08/2024* 27/08/ , Mettler-Toledo Safeline Limited ,268 17/07/ /08/2024* 27/08/ , Mettler-Toledo Safeline Limited ,854 27/08/ /08/2024* 27/08/ , In the Style Fashion Limited ,232 15/05/ /05/ /05/ /05/ , Total 108, , * Mettler-Toledo Safeline Limited have recently agreed a reversionary lease for a further 5 years commencing 27 August 2019 and expiring 26 August 2024, which will be subject to a Day One open market upwards only rent review clause in

8 Mettler Toledo Safeline Limited ( ) Mettler-Toledo Safeline Limited has been producing metal detection systems from its Olympic Court, Salford manufacturing facility since 1994 and has installed metal detection systems to inspect over one trillion food and pharmaceutical packages per annum. That s 150 packages for every human being on the planet. Mettler-Toledo Safeline Limited s results for 2016 show a turnover of c. 39.3m and pre-tax profit of c m, compared with 37.4m and c. 8.6m respectively in This was primarily a result of significant income from shares in group undertakings and a loan note of 550m, which was used to acquire the remaining 45% of Mettler-Toledo Holding AG. Even excluding this, profit on ordinary activities (i.e. excluding group undertakings) reached 14.04m which was a 63% increase on the previous year. Mettler-Toledo Safeline Limited have a Dun & Bradstreet rating of 5A1 representing a minimum risk of business failure. A summary of the last three years accounts is set out below: In The Style Fashion Limited ( ) In The Style Fashion Limited is headquartered at Olympic Court. Founded in 2013, the company has grown from a single founder to 83 employees in A social first marketing strategy has given the brand a social media wide reach of 18 million people, after royalty-based collaborations with celebrities and fashion influencers. In The Style are targeting revenues in excess of 50 million within three years and hence have invested heavily into branding, visibility and marketing, resulting in a financial loss. However, the company turnover reached c. 9.22m this year, reflecting the continued growth and success of the company. In May 2017, the company secured a multi-million pound investment from private equity firm Livingbridge Venture Capital to make significant IT and infrastructure upgrades, along with various senior executive hires. In The Style Fashion Limited has a Dun & Bradstreet rating of N3 representing a higher than average risk of business failure. A summary of their available accounts are set out below: 31 Dec Dec Dec 2014 Sales Turnover 39,303,000 37,400,000 37,944,000 Profit/(Loss) Before Taxes 723,181,000 8,598,000 8,998,000 Tangible net worth 5,061,472,000 1,926,022,000 1,919,666,000 Net Current Assets (Liabilities) 205,187,000 45,204,000 38,905, Mar Mar Mar 2015 Sales Turnover 9,218, Profit/(Loss) Before Taxes ( 326,974) - - Tangible net worth ( 763,649) ( 476,609) ( 518,401) Net Current Assets (Liabilities) ( 854,234) ( 582,204) ( 524,771) 8

9 OCCUPATIONAL MARKET COMMENTARY Property Size (sq ft) Tenant Rent ( psf) Term Date Occupational demand in the Greater Manchester region remains exceptionally strong for good quality well located stock, fuelled largely by the continuing growth of e-commerce and the internet fulfilment sector. The prevailing industrial occupational market in Greater Manchester is characterised by record constrained supply, especially of good quality small to mid size business units. The supply of good quality accommodation ranging from 10,000 to 30,000 sq ft remains low, with extremely limited speculative development of units in this size range. Olympic Court is therefore ideally placed to capitalise on the increased number of occupational requirements in this size bracket. This dearth of stock is resulting in increasing pressure on rents, which are predicted to rise even further due to the weight of demand from occupiers. Comparable letting activity has predominantly taken place at Trafford Park, where rental levels range from between 5.75 psf and 7.00 psf. The rental premium attached to Trafford Park makes Olympic Court highly attractive to occupiers as it offers similar communications along with the amenities provided by MediaCityUK, but at a discounted rent that will continue to generate significant occupier demand. Unit 14, The Albion, Salford Unit 7 Circle South, Trafford Park Unit 3, Premier Park, Trafford Park Unit 5, Commerce Way, Trafford Park Unit 7, Premier Park, Trafford Park Unit 1, Kestral Road, Trafford Park 10 YEAR NORTH WEST TAKE-UP 12,475 Under Offer c years (5 year break) Jan-18 13,630 Confidential years Dec-17 15,674 Iceland Foods ,118 ITV Studios ,145 Maniere du Voire years (5 year break) 10 years (5 year break) 10 years (5 year break) Sep-17 Aug-17 Jun-17 16,348 Steamforged Games years May YEAR NORTH WEST AVAILABILITY RATE We consider Olympic Court to offer investors the potential for a significant reversion at Mettler-Toledo s Day One open market upwards only rent review in

10 VAT The property is elected for VAT and it is anticipated that the transaction will be treated as a Transfer of Going Concern (TOGC). EPC The units have the following EPC ratings: Unit D(81) Unit C(71) Unit C(60) Unit C(73) Unit D(78) DATA ROOM Data room access can be provided upon request. PROPOSAL We are instructed to seek offers for the freehold interest in excess of 8,685,000 subject to contract and exclusive of VAT. A purchase at this level would reflect a net initial yield of 5.75% and a low capital value of 80 per sq ft, after deducting purchasers costs of 6.68%, with an attractive reversionary position. FURTHER INFORMATION Callum Robertson +44 (0) (0) crobertson@geraldeve.com Leo Nicholson +44 (0) (0) lnicholson@geraldeve.com Charlotte Campbell +44 (0) (0) ccampbell@geraldeve.com John Prichard +44 (0) (0) jprichard@geraldeve.com Conditions under which these particulars are issued: All details in these particulars are given in good faith, but Gerald Eve LLP for themselves and the Vendors/Lessors of this property for whom they act give notice that:- 1. These particulars do not and shall not constitute, in whole or in part, an offer or a contract or part thereof, and Gerald Eve LLP have no authority to make or enter into any such offer or contract. 2. All statements contained in these particulars are made without acceptance of any liability in negligence or otherwise by Gerald Eve LLP, for themselves or for the Vendors/Lessors. 3. None of the statements contained in these particulars is to be relied on as a statement or representation of fact or warranty on any matter whatsoever, and intending purchasers must satisfy themselves by whatever means as to the correctness of any statements made within these particulars. 4. The Vendors/ Lessors do not make, give or imply, nor do Gerald Eve LLP or any person in their employment have any authority to make, give or imply, whether in these particulars or otherwise, any representation or warranty whatsoever in relation to the property. This statement does not affect any statutory rights you may have nor does it intend to limit Gerald Eve s liability which cannot be excluded or limited by law. Particulars issued February 2018.