Lacuna Place HAVELOCK ROAD, HASTINGS TN34 1BP LONG LET TOWN CENTRE INVESTMENT SECURED AGAINST THE DEPARTMENT OF WORK AND PENSIONS & TESCO

Lacuna Place HAVELOCK ROAD, HASTINGS TN34 1BP LONG LET TOWN CENTRE INVESTMENT SECURED AGAINST THE DEPARTMENT OF WORK AND PENSIONS & TESCO

02 Investment Summary 2 High quality office building with ground floor retail accommodation totalling 39,696 sq ft. Constructed in 2008. Excellent town centre location forming part of the Priory Quarter office sector adjacent to Hasting train station and within a short walk of the Priory Meadow shopping centre and an abundance of amenities. BREEAM Very Good rating, provides excellent green credentials. Office accommodation let to the Department of Work and Pensions on a lease expiring in January 2033. Department for Work & Pensions lease subject to an RPI uplift in January 2023. Ground floor retail unit let to Tesco Stores Limited. Tesco lease subject to an uncapped RPI uplift in February 2019. Passing rent of 605,786.58, reflecting only 17.00 per sq ft on the office accommodation. Additional vacant ground floor retail unit fitted to shell & core, affording an opportunity to increase rental income. Freehold. PROPOSAL Offers are sought in excess of 10,000,000 (Ten Million Pounds) subject to contract and exclusive of VAT. A purchase at this level reflects a Net Initial Yield of 5.68% and a Reversionary Yield of 5.76% in February 2019 (based on average RPI figures), assuming purchaser s costs of 6.7% This equates to a capital value of only 252 per sq ft.

03 Location Hastings, one of the five original Cinque Ports established in 1155 to maintain ships for the Crown, is located in East Sussex on England s south coast. The town is approximately 55 miles south of London, 31 miles south west of Ashford and 16 miles east of Eastbourne. It is connected to the national road network by the A21, linking to J5 of the M25, and the A259 south coast road leading to Brighton to the west and Folkestone to the East. Hastings rail station offers frequent services to London, either by Southeastern Trains to London Bridge and Charing Cross or by Southern via Ashford to St Pancras International or Victoria. Ashford Station provides access to HS1/Eurostar. Hastings also benefits from an east-west rail service to Eastbourne (30mins) and Brighton. London Gatwick airport is 39 miles to the north and the port of Dover (40 miles) and the Channel Tunnel (36 miles) are to the east. The population of Hastings is approximately 90,000. ROAD The town benefits from good road communications with the A21 providing links to Tunbridge Wells and the M25 beyond, whilst the A259 provides coastal links to Brighton, Ashford, the Channel Tunnel, ferry ports and the M20. The newly opened Combe Valley Way also provides easy access to neighbouring Bexhill, Eastbourne and Brighton. At a cost of 120 million, the Bexhill to Hastings link road has reduced local congestion and travel times to Eastbourne and Brighton. It is anticipated this road improvement will assist the delivery of up to 2,000 new homes and 3,000 new jobs. RAIL Frequent trains run from Hastings direct to Charing Cross, Waterloo East, London Bridge and Victoria (via Brighton) from 83 minutes. There is also a commuter train to Cannon Street and a service along the south coast connecting Hastings to Brighton (from 69 minutes) and Ashford International (42 minutes). L O N D O N M4 CITY HEATHROW M25 M25 M25 SEVENOAKS MAIDSTONE GUILDFORD M23 ROYAL A229 GATWICK TUNBRIDGE EAST WELLS CRAWLEY GRINSTEAD A26 HORSHAM WORTHING A24 CROYDON BROMLEY EPSOM A23 BRIGHTON DISTANCE BY ROAD Ashford International Brighton Gatwick Airport M25 Junction 5 Central London TRAIN TIMES London Bridge Cannon Street Charing Cross Waterloo East Victoria Brighton Ashford International A22 DARTFORD A259 EASTBOURNE A21 34 miles 36 miles 39 miles 42 miles 71 miles from 1 hr 22 mins from 1 hr 40 mins from 1 hr 33 min from 1 hr 28 mins from 1 hr 50 mins from 1 hr 10 mins from 42 mins M2 SOUTHEND-ON-SEA M20 ASHFORD INTERNATIONAL (EUROSTAR) A259 HASTINGS CANTEBURY E N G L I S H C H A N N E L A2 EURO TUNNEL FOLKESTONE MARGATE DOVER

04 Situation The property is situated in Hastings town centre within The Priory Quarter, has a prominent frontage onto Havelock Place and rear access to Priory Square. The Priory Quarter was developed in phases and has delivered over 100,000 sq ft of high quality offices over a 10 year period aimed at attracting local, regional and national companies to the area. Occupiers in the area include Department of Work and Pensions, Saga Group, General Dynamics, Medica, Park Holiday and Hasting Direct. Hasting railway station, Priory Meadow Shopping Centre, Sussex Coast College and the town centre amenities are all within a short walk of the property. BRAYBROOKE ROAD CORNWALLIS GDNS CAMBRIDGE RD A21 P CAMBRIDGE GDNS P HASTINGS PRIORY STREET A21 HAVE DEV ONSHIRE ROAD LOCK ROAD DEBENHAMS SOUTH TERRACE DENMARK PLACE A259 P PRIORY MEADOW SHOPPING CENTRE Lacuna Place ALBERT ROAD QUEENS ROAD PELHAM PL P RETAIL AREAS LOCAL AMENITIES Hotels The Bannatyne Spa Hotel Travelodge Premier Inn Golf clubs Hastings & St Leonards Golf Club Beauport Park Golf Club Sedlescombe Golf Club Restaurants & Retail Tesco Extra Morrisons Sainsbury s Costa Coffee Café Nero The Priory Meadow Shopping Centre Galleries The Jerwood Gallery

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06 University of Brighton Priory Meadow Shopping Centre and Public Car Park Lacuna Place Department of Work & Pensions Havelock Place - Department of Work & Pensions Priory Square One Priory Square - Saga Group Limited Priory Street Car Park University of Brighton Sussex Coast College Queensbury House Bus Station Hastings Cornwallis Gardens

07 Description Lacuna Place was developed in 2008 as the first phase of the Priory Quarter, Hastings. The building provides 31,911 sq ft of Grade A office accommodation with a ground floor reception, offices on 1st to 4th floor and, a terrace on the 4th floor and basement car parking for 13 cars. The offices were built to Grade A standard with rating BREEAM Very Good. In addition, there are two retail units on the ground floor, Unit One totals 3,143 sq ft and Unit Two totals 4,642 sq ft. The accommodation has a prominent frontage onto Havelock Road with rear access onto Priory Square and is one of a cluster of buildings which form The Priory Quarter. The floor plates are regular and create open plan areas either side of the central core with a feature reception with dual access onto Havelock Road and Priory Square. The building benefits from the following specification: Feature ground floor reception 2x 10 person passenger lifts Fully accessible raised floors Metal tile suspended ceilings LG7 compliant recessed lighting Three pipe fan coil air conditioning BREEAM rating Very Good Secure basement parking for 13 cars (1:2,455 sq ft) with numerous public car parks nearby Designated cycle racks Terrace at 4th floor level Male, female and disabled WC s and shower facilities DDA compliant Prior to the letting to the Department of Work and Pensions the building was used by the University of Brighton as a teaching facility, planning consent has since been obtained to a change of use from D1 to B1 to accommodate the letting. The Department of Work and Pensions will be moving its employees from its current base in Ashdown House on the outskirts of Hastings to Lacuna Place and the adjacent Havelock Place in Hastings town centre. The intention is to fit out and link both buildings to create a Regional Hub. The works are expected to start in 2019 with a view to relocating staff upon completion.

08 Accommodation Floor Areas Description Typical floor plan Sq m Sq ft Reception 96.7 1,041 First Floor 772.4 8,314 Second Floor 765.5 8,240 Third Floor 765.5 8,240 Fourth Floor 564.5 6,076 2,964.6 31,911 Unit One 292.0 3,143 Unit Two 431.3 4,642 Retail Sub Total 723.3 7,785 3,687.9 39,696 Offices NIA Offices Sub Total Retail NIA TOTAL Site Tenure Freehold. For identification purposes only. Not to scale.

09 Tenancy Demise Use Area (sq ft) Basement, Part Ground & 1-4 Floors Tenant Office 31,911 The Secretary of State for Communities and Local Government Lease Start Lease Expiry Break Option Rent Review 26/01/2018 25/01/2033 26/01/2028 26/01/2023 26/01/2028 Current rent psf Comments 533,639 17.00 First review linked to RPI with a collar of 0% and a cap of 3%. Second review to the higer of OMV or rent passing. The tenant is paying a reduced rent of 354,978.45 per annum until first review. Vendor to top-up. Lease subject to a Schedule of Condition. Unit One Retail 3,143 Teco Stores Limited 18/02/2009 17/02/2024 18/02/2019 72,147.58 22.96 Rent reviewed to the higer of passing rent or uncapped RPI. Unit Two Retail 4,642 Vacant Fitted to shell and core. TOTAL 39,696 605,786.58

10 Covenant The Department of Work and Pensions Department of Work and Pensions (DWP) is responsible for welfare, pensions and child maintenance policy. It is the UK s biggest public service department that administers the State Pension and a range of working age, disability and ill health benefits. Tesco Stores Limited (Company No. 519500) Tesco Stores Ltd (Company No. 519500) is wholly owned by Tesco Plc, one of the largest retailers in the world. Established in 1919, Tesco now operate from over 6,902 stores nationwide, employing over 476,000 staff. Tesco is the leading food store operator within the UK, the largest of the Big Four supermarket chains dominating the UK s grocery market. Tesco holds a current market share of 27.7% (at 25/05/2018). Tesco Stores Ltd has a D&B rating of 5A1. 25/02/2017 000 27/02/2016 000 28/02/2015 000 Sales Turnover 40,134,000 39,843,000 42,278,000 Pre-Tax Profit 266,000 ( 231,000) ( 3,727,000) Net Worth 749,000 1,077,000 ( 98,000)

11 Market Overview Local Office Market Overview The Priory Quarter, Hastings provides the only genuine grade A office accommodation in the town and has attracted local, regional and national occupiers to Hastings over a period of 10 years. As demonstrated by the letting history of The Priory Quarter, the development of speculative offices in a cost effective location has attracted inward investment and helped retain existing occupiers. In addition to the recent 57,000 sq ft letting to The Department of Work and Pensions other notable deals include the sale of One Priory Square comprising 44,000 sq ft to Saga Group for their own occupation and the letting of 25,000 sq ft at Bexhill Innovaton Park to Park Holidays. Hastings forms part of the Sussex triangle bounded by Brighton the west and Crawley and Tonbridge to the north and Ashford to the east. In contrast to the more established markets of Brighton and Crawley, Hastings offers a significant rental discount with prime rents standing at only 17.00 per sq ft, with potential for future rental growth. There is no Grade A supply currently available in the area and the only new development is at Bexhill Innovation Park where High Weald House comprising 25,000 sq ft is under construction and scheduled for completion Q2 2019. Investment Market The South East office investment market continues to perform strongly, and pricing has remained robust as investors are attracted by the relatively high returns available compared to other sectors of the property market and other asset classes. Where assets with good fundamentals have come to the market, there has been significant interest from both domestic and overseas investors. Demand is particularly strong for assets offering longer income, let to strong covenants with private overseas investors, local authorities and UK institutions all looking to acquire. Recent transactions of note include the following: Date Address Tenant Term Certain (years) Price Net Initial Yield Aug-18 Quadrangle, Redhill AXA 9.25 21m 5.46% Aug-18 Pinnacle House, Wimbledon Kindred (London) Limited 14.1 40.19m 5.50% Jul-18 Building One, Abingdon Business Park Gigaclear PLC 10 9.6m 5.79% Jul-18 Volvo HQ, Maidenhead Volvo UK 9.3 12.06m 5.30% Jun-18 Volkswagen HQ, Milton Keynes Volkswagen 16.6 50.15m 4.83% Jun-18 Axis One, Langley Travelport Worldwide Ltd 9.1 19.33m 5.65% Mar-18 36 Clarendon Road, Watford Salmon Ltd 10 15.5m 5.60% Nov-18 Eaton House, Hounslow Let to Secretary of State for Communities and Local Government 10 8.3m 5.65% Nov-17 Centrica, Oxford Centrica 9.7 35.03m 4.90% Oct-17 Cobham Centre, Marlow Chelton Ltd 19 31m 5.11%

Lacuna Place HAVELOCK ROAD, HASTINGS TN34 1BP EPC The property has an EPC rating of D (77). VAT We understand the property will be treated as a Transfer of Going Concern for VAT purposes. PROPOSAL Offers are sought in excess of 10,000,000 (Ten Million Pounds) subject to contract and exclusive of VAT. A purchase at this level reflects a Net Initial Yield of 5.68% and a Reversionary Yield of 5.76% in February 2019 (based on average RPI figures), assuming purchaser s costs of 6.7% FURTHER INFORMATION & CONTACT DETAILS James Archibald T: 020 3362 4357 M: 07979 746 791 E: jamesarchibald@brayfoxsmith.com Richard Harding T: 020 3362 4349 M: 07730 817 019 E: richardharding@brayfoxsmith.com This equates to a capital value of only 252 per sq ft. Misrepresentation Act. These brief particulars have been prepared as agent for our client and are intended as a convenient guide to supplement an inspection or survey. Their accuracy is not guaranteed. They contain statements of opinion and in some instances we have relied on information provided by others, you should verify the particulars on your visit to the property and the particulars do not obviate the need for a full survey and all the appropriate enquiries. Accordingly, there shall be no liability as a result of any error or omission in the particulars or any other information given. Compiled October 2018.