For Sale Prime Retail Investment
INVESTMENT CONSIDERATIONS Let to Barclays Bank PLC (14 years unexpired), and Republic Retail Limited; Rebased Zone A s 100% Prime Pitch Large well- configured shop units 3,175,000 7% net initial yield LOC ATION Walsall is one of the largest Centres within the West Midlands conurbation. It is situated approximately 10 miles to the north of Birmingham City Centre, 6 miles east of Wolverhampton, 5 miles north of West Bromwich and 6 miles west of Sutton Coldfield. The town benefits from excellent communications being some 2 miles from both junctions 9 and 10 of the M6 Motorway. The M6 links to the National Motorway Network with the M54, the M42 and the M6 Toll Road, all within a few junctions. Birmingham International Airport and the National Exhibition Centre are both approximately 16 miles to the south east, accessed via the M6. Intercity Rail Services are available from both Wolverhampton and Birmingham with regular services to London Euston and the North. Walsall has a resident population of 170,994 (2001 Census) and a catchment population of 812,889 within a 6 mile radius of the town centre. RE TAILING IN WALSALL Walsall has a strong retail offer which is centred upon the pedestrianised Park Street which links the Crown Wharf Shopping Park to the north, the Saddlers Shopping Centre in the centre of Park Street and Old Square Shopping Centre to the south The Saddlers Centre is anchored by Marks & Spencer who also have a frontage to Park Street. Crown Wharf is a large unit retail scheme anchored by Asda Living, with retailers including Next, Mothercare, T K Maxx, Top Shop/Top Man and J D Sports. Debenhams anchor the Old Square Shopping Centre where a major new unit is currently being developed for Primark which should further enhance the pedestrian flow along Park Street. SITUATION The property is located in 100% prime pitch on the eastern side of Park Street. Walsall s bus station is situated immediately behind the property and significant pedestrian flow enters Park Street three doors along via the Park Street Arcade. Major multiple retailers within the immediate vicinity include Sports Direct, 3Store, River Island, Clintons, Marks & Spencer, Orange, New Look, T Mobile and McDonalds.
DESCRIPTION The property comprises a four storey building of brick construction with a flat roof. It is arranged to provide two large retail units on the ground floor with ancillary accommodation on the first to third floors. The property has the benefit of rear loading. TENURE The property is freehold. ACCOMMODATION LEASES & TENANTS Unit 1 16/22 Park Street (Areas Documented in the Lease) Net Frontage 8.56 m 28 ft 1 ins Shop Depth 31.68 m 103 ft 11 ins Ground Floor Sales 268.95 sq.m. 2,895 sq.ft. ITZA 97.18 sq.m. 1,046 sq.ft. First Floor 226.03 sq.m. 2,433 sq.ft. Second Floor 260.50 sq.m. 2,804 sq.ft. Third Floor 105.44 sq.m. 1,135 sq.ft. Unit 2 16/22 Park Street Lease Let to Barclays Bank plc on a full repairing and insuring lease for a term of 15 years from 23rd August 2011. The rent is 120,000 per annum and the lease provides for upward only 5 yearly rent reviews. There are no break clauses. The tenants were provided with a rent-free period at the commencement of the term, which expires in August 2014. Our clients will pay the rent of 120,000 per annum until this rent-free period expires. Lease Tenant For the year ended 31st December 2011, Barclays Bank plc reported a turnover of 33.033 billion, pre-tax profits of 5.879 billion and net assets of 65.196 billion. Tenant Net Frontage 8.59 m 28 ft 2 ins Shop Depth 32.97 m 108 ft 2 ins Ground Floor Sales 293.94 sq.m. 3,164 sq.ft. ITZA 166.00 sq.m. 1,141 sq.ft. First Floor 256.69 sq.m. 2,763 sq.ft. Second Floor 275.64 sq.m. 2,967 sq.ft Third Floor 135.07 sq.m. 1,455 sq.ft. The ground, first and second floors are let to Republic Retail Ltd. on a full repairing and insuring lease for a term of 5 years from 25th December 2009. The current rent is 110,000 per annum which increases to 115,000 per annum on 25th December 2013. Our clients will top-up the rent to 115,000 per annum until 25th December 2013. The rent is payable monthly in advance. For the year ended 30th January 2011, Republic Retail Ltd. reported a turnover of 181 million, pre-tax profits of 27.3 million, and net assets of 42.54 million. As at 30th January 2011 the company traded from 111 stores and through an E Commerce site.
RENTAL LEVELS Historically rental levels in Park Street reached approximately 120 Zone A. Over the past three years there has been a correction to reflect current market conditions, and most recent settlements reflect Zone A levels of between 65 and 80. We devalue the Republic rent to 61.54 Zone A, and the Barclays rent to 77.94 Zone A. This investment therefore offers good potential for rental growth moving forward. PRICE Our clients are seeking a price of 3,175,000 to show a net initial yield of 7%, allowing for purchasers costs of 5.8%. VAT The property has been registered for VAT, and Value Added Tax will therefore be payable on the consideration. It is envisaged, however, that this sale will be dealt with by way of a TOGC. VIEWING Strictly by appointment with the sole agents:- David Thompson Rowley Hughes Thompson 0121 212 7803 davidt@rhtretail.co.uk DATE PREPARED: JUNE 2012 MISREPRESENTATION ACT 1967 NOTICE. Rowley Hughes Thompson themselves and for the vendors or lessors of the property whose agent they are give notice that 1. These do not constitute any part of any offer or contract. 2 All statements contained in these particulars as to this property are made without responsibility on the part of Rowley Hughes Thompson their vendors or lessors. 3. None of the statements contained in these particulars as to this property are to be relied as statements or representation of face. 4. Any intending purchases or lessors must satisfy themselves by inspection or otherwise as to the correctness of each of the statements contained in these particulars. 5. The vendors or lessors do not make or give neither Rowley Hughes Thompson nor any person in their employment has any authority to make or give any representation to warrantee whatever in relation to this property.