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The Amundi Collection TY ADMIRAL DAVID STREET CARDIFF
The Amundi Collection
T Y A D M I R A L D AV I D S T R E E T
C A R D I F F
Ty Admiral – Cardiff
Admiral Group Plc’s Global Headquarters, a prime landmark headquarters office building completed in 2014.
Located in Wales’ capital city and administrative centre, adjoining the St David’s Shopping Centre and the 280,000 sq ft John Lewis Department Store.
Situated in the heart of Cardiff’s Central Business District with excellent connectivity to the Cardiff Central & Queen Street Railway Stations and planned Transport Interchange.
Grade A office building completed in 2014 comprising 206,833 sq ft of principally office accommodation together with three retail units and 120 basement car parking spaces.
25 year lease from 15th September 2014 expiring on 14th September 2039, equating to circa 21.25 years unexpired.
5 yearly upward only rent reviews index linked to the Retail Price Index with a collar and cap at 1.5% and 3.0% per annum compounded annually.
Rental to be topped up to £3,705,560 per annum equating to a very low rent of £18.08 per sq ft, which reflects a significant discount to current prime headline office
rents of £25.00 per sq ft.
Let to EUI Limited who have a D&B rating of 5 A1.
Guaranteed by Admiral Group Plc who have a D&B rating of 5 A1 and an investment grade covenant with a Moody’s credit rating of A1.
Fully occupied building with up to 3,500 employees based at the property.
BREEAM ‘Excellent’ rating and EPC rating of ‘B 34’.
Opportunity to benefit from substantial capital allowances.
We are instructed to seek offers in excess of £80,900,000 for the entire share capital in the Immo UK Admiral Cardiff S.à.r.l that owns the property, subject to contract and exclusive of
VAT. This reflects a net initial yield of 4.50% (assuming acquisition costs of 1.80%).
This reflects a low capital value of £391 per sq ft.
INVESTMENT SUMMARY
T Y A D M I R A L D AV I D S T R E E T
C A R D I F F
S WA L E C S TA D I U M
P R I N C I PA L I T Y S TA D I U M
C I T Y H A L LQ U E E N S A R C A D E
C A R D I F F C A S T L E
T H E H AY E S
M O T O R P O I N T A R E N A
U N I V E R S I T Y O F S O U T H
WA L E SS T D AV I D S S H O P P I N G
C E N T R ES T D AV I D S S H O P P I N G
C E N T R ES T M A R Y S
S T R E E TC E N T R A L S Q U A R E
C E N T R A L Q U AY
C A P I TA L Q U A R T E R
J O H N L E W I S
C A R D I F F C E N T R A L L I B R A R Y
C A R D I F F Q U E E N S T R E E T S TAT I O N
C A R D I F F C E N T R A L S TAT I O N
C A L L A G H A N S Q U A R E
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Cardiff is the administrative centre for the Welsh Government and home to the internationally recognised Principality (Millennium) Stadium and Wales Millennium Centre.
The city has a resident population of approximately 358,500, which is swelled by over 80,000 full-time students from the city’s expanding higher education sector. A further catchment population in excess of 1.5 million is situated within a 45-minute travel time from the city centre.
Through the Cardiff Master Plan, both Cardiff City Council and Welsh Government are committed to further improving the infrastructure and economic profile of both Cardiff and its City Region, to consolidate it as one of the most important regional centres in the UK for occupiers and investors alike. These initiatives include:
Cardiff Central Enterprise Zone Centred around Cardiff Central Railway Station. This is the only Enterprise Zone in the UK dedicated to attracting and growing the financial and professional services sector.
Electrification of the main intercity rail line This will improve Cardiff’s connectivity via faster journey times to London with the work scheduled to be completed by Q4 2018.
Investment in Cardiff Central and Queen Street Railway Stations Plans to create new civic scaled public squares to the north and south of the station as high-quality arrival spaces and “gateways” to the city. Work is already completed on the south side of the station.
Improved connectivity between the city centre and Cardiff Bay The Arriva Trains Wales franchise has been retendered in 2018. Two parties have been short listed and an announcement on the successful operator is imminent. As part of their strategy, they will address the Valley Line links into Cardiff Central via Queen Street and the introduction of a rapid transport link between the city centre and its waterfront.
Cardiff Airport The Welsh Government have acquired the airport looking to boost its profile and increase of the number of airlines and routes around Europe and beyond. This expansion has recently included the addition of new routes by Qatar Airways.
International Convention Centre & Arena Work is underway to construct a new Convention Centre at Celtic Manor Resort in Newport. In addition, a site in Cardiff Bay has been earmarked as a potential location for a new state of the art arena with a capacity of 10,000+.
Academic Profile 80,000 students from Cardiff University, Cardiff Metropolitan University, University of South Wales and the Royal Welsh College of Music and Drama.
Cardiff is expected to grow faster than any other UK city in population terms, 26% over the next 20 years. It is currently ranked the 6th best shopping destination in the UK, following the completion of the St David’s Shopping Centre and the largest John Lewis store outside of central London.
Cardiff is also consistently ranked top in UK quality of life indices – including Moneysupermarket.com’s 2014 index, the recent EU Urban Audit, and Legal & General’s best city for young people survey. It was also voted the 3rd best capital city in Europe to live in, following a recent EU survey in 2017.
The public sector is driving forward on the £1.28bn city deal for boosting the economy of the Cardiff Capital Region which combines 10 local authorities surrounding and supporting the city. The Cardiff Capital Region has a Gross Value Added (GVA) of approximately £25 billion, accounting for 51% of the Welsh Economy.
Employment within the city is centred on the retail, finance, media and tourism sectors. Major occupiers within the city include Deloitte, Eversheds, L&G, KPMG, PWC, Lloyds Banking Group, Cardiff Council, Welsh Government and, shortly, the BBC.
The city is renowned for hosting some of the world’s most prestigious sporting events such as the UEFA Champions League Final, World & European Rugby Cup Finals, Ashes Cricket Tests and assisting in the hosting of the 2012 Olympic Games.
CARDIFFA CAPITAL CITY
Cardiff Capital Region comprises 51% of Welsh Economy
Cardiff is situated 150 miles to the west of London and 40 miles to the west of Bristol. It benefits from excellent transport links, both from the M4 motorway (Junctions 29-33) and a mainline rail destination with intercity journey times to London and Birmingham of 2 hours, as well as local rail links throughout South Wales. Cardiff Airport is located west of the city and provides direct access to numerous international destinations, which has recently expanded with the addition of a new carrier (Qatar Airways) in 2018.
3rd best European city for quality of life
EUROPEAN UNION
51%
The UK’s fastest growing Core City with projected population growth of 20% by 2035
A1(M)
A1(M)
A1(M)
M62
M18
M60
M42
M25
M23 M20
M27
M11
M56
M54
M50
M40
M1
M1
M2
M6
M6
M5
M5
M4
M4
M3
LEEDS
LIVERPOOL
BIRMINGHAM
NOTTINGHAM
NORWICH
CAMBRIDGE
LONDON
CHELTENHAM
GLOUCESTER
SWANSEABRISTOLCARDIFF
OXFORD
BATH
SOUTHAMPTON
EXETER
BOURNEMOUTH
BRIGHTON
DOVER
HeathrowBristol
Cardiff
33
32
30A470
A470
A470
A4054
A4161
A4232
A4232
A4050
A4050
A4050
A4226
A4226
A469
A48
A48
A48
A48
M4
M4
A48(M)
CARDIFFINTERNATIONALAIRPORT
RHOOSE
BARRY
CARDIFF
BARRY
B R I S TO L
C H A N N E L
CARDIFF BAY
CARDIFF CENTRAL
3
THE WORLD’S FIRST FREE
TRADE CAPITAL
18 million Tourist visits annually and home to Premier League Football team, Cardiff City
RANKED 6TH
ALTERNATIVE
TOURIST
DESTINATION
20%
RESIDENT POPULATION OF
c.350,000 with 1.5 million people living within a 45-minute drive
Ty Admiral – Cardiff
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LOCATION
A4161
High Street
Duke Street
Westgate Street
Wood Street
Custom House Street
Adam Street
Bute Ter
race
Herbert Street
Bute Street Bute Street
Bridge
Street
Guildfo
rd S
tree
t
Station TerraceC
hurchill Way
Churchill Way
Park Street
Park Street
Tredegar Street
The Hayes
St Mary Street
St Mary Street
Queen Street
CARDIFF CENTRAL
CARDIFFCASTLE
PRINCIPALITYSTADIUM
CENTRAL SQUARE
CARDIFF CENTRALLIBRARY
QUEENSARCADE
ST DAVID’SSHOPPING
CENTRE
CAPITALQUARTER
CALLAGHANSQUARE
CENTRAL QUAY
THEARCADES
CARDIFFQUEENSTREET
NEW TRANSPORT INTERCHANGE
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JOHN LEWIS
The property has excellent prominence overlooking St David’s Shopping Centre as well as adjoining the Motorpoint Arena. It is also within close proximity to the Radisson Hotel Tower, Central Square and Callaghan Square, the prime city centre office location, as well as Central Station. The entire area has seen a dramatic transformation since the opening of the second phase of the St David’s Shopping Centre and the on-going Central Square Development.
The area has attracted significant occupiers that include John Lewis who occupy a 280,000 sq ft stand alone retail unit, and in the office sector occupiers include Eversheds, ING, Lloyds Bank, Zurich Insurance, Arriva Trains, Allied Irish Bank, AA, Deloitte, and Network Rail.
Cardiff Council’s objective for Cardiff is to further enhance this entire area, thus consolidating the central business district as well as promoting the ‘Central Area Core’ focussed on Cardiff Central Station and the Principality Stadium.
2 3 4
1
Admiral Group Plc’s Headquarters are situated in a prominent location at the entrance to the St David’s Shopping Centre, with the property fronting onto David Street, just off Bridge Street and the corner of Churchill Way.
Ty Admiral – Cardiff
K E Y
1 John Lewis
2 Cardiff Central Library
3 Principality Stadium
4 St David’s Shopping Centre
5 Wales Millennium Centre
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5 CONNECTIVITY
D I S TA N C E B Y RO A D
London 236 km 147 miles
Bristol 69 km 43 miles
Birmingham 182 km 113 miles
Swansea 67 km 41 miles
Newport 24 km 15 miles
High speed rail services give rapid access to all major cities across the UK. Cardiff Central Station is one of the principal stations on the Great Western Line.
Cardiff Central Station is also the hub of an extensive Valley Line Network serving the inland towns of south east Wales, from where a significant proportion of the city’s work force is drawn. The delivery of an integrated Cardiff Metro system has been allocated up to £730m from the Cardiff Capital City Region Deal. The project may include the introduction of a light rail system to Cardiff alongside delivery of a major upgrade to the existing rail network around Cardiff, which will be centred on Cardiff Central Station. A contract will be awarded to an operator in 2018.
N A T I O N A L R A I L T I M E S F RO M C A R D I F F
London 2 hours
Bristol 50 minutes
Reading 1 hour 35 minutes
Birmingham 1 hour 59 minutes
Manchester 3 hours 10 minutes
Electrification of the railway between London Paddington and Cardiff Central is set to be completed in Q4 2018 reducing best travel times to 1 hour 45 minutes.
Cardiff has its own international airport located 19.2 km (12 miles) from the city at Rhoose. The airport serves many national and European destinations.
London’s Heathrow airport is less than a two hour drive or rail journey from the city.
Cardiff has outstanding road, rail and air communications. The city is situated on the M4 motorway, and lies approximately 236 km (147 miles) from London in the east. South Wales links via the M50 and M5 motorways to the Midlands and south west of England. Almost 80%
of the UK population lives within a 4-hour drive of Cardiff.
Ty Admiral – Cardiff
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CARDIFFINWARD INVESTMENT &
MAJOR DEVELOPMENT SCHEMES
Cardiff has enjoyed substantial development and regeneration in the last 20 years including the creation of Cardiff Bay, the Bute Town Tunnel link road, Principality Stadium and St David’s Shopping Centre.
These schemes have helped to draw attention to the city and have provided the catalyst to further large scale developments with Callaghan Square, the redevelopment of Cardiff Central Station, Central Square, Central Quay, and Capital Quarter. All of these schemes are within a short distance of Ty Admiral. These are the exciting next phases of development within Cardiff’s Core Area adding up to an ongoing £5bn investment programme.
C E N T R A L S Q U A R E
A joint venture between Cardiff Council and Rightacres to comprehensively redevelop the north side of Cardiff Central Station. The 165,000 sq ft BBC Wales Headquarters building, shortly to be completed, is a central feature. One Central Square, a 135,000 sq ft Grade A office building, has already been completed and fully let with Two Central Square, an office building of 145,000 sq ft under construction and fully pre-let. The scheme will extend to over 1 million sq ft with a 270,000 sq ft office building proposed for HMRC to house 2,000 workers and include a 33,000 sq ft public square comprising outdoor cinema and café area.
C A R D I F F C E N T R A L S TA T I O N
Network Rail has announced plans for a major redevelopment of the station to increase capacity and significantly enhance services provided. The scheme could include further mixed-use development along with the development of the Network Rail South Car Park to include a multi-storey car park to increase the parking capacity to 1,000 cars and add potential for further office, leisure, retail and residential accommodation.
C E N T R A L Q U AY
Directly to the south of Cardiff Central Station, Brains and Rightacres have entered into a joint venture on the Brains Brewery site with master planning ongoing for a mixed-use scheme that could provide 3 million sq ft of development. The first phase of this scheme, The Ledger Building, which is a c.260,000 sq ft speculative office building is currently in the planning system.
C A P I TA L Q U A RT E R
JR Smart is currently on site developing Number 3&4 Capital Quarter, a 75,000 sq ft and 96,000 sq ft of speculative office, respectively. This is in addition to the already completed Number 1 & Number 2 Capital Quarter office buildings which are now nearly fully let to tenants including, Finance Wales, Parsons Brinckerhoff, Alert Logic and Welsh College of Nursing. A 350-unit student housing block is also under construction with further plans for a 200-unit PRS scheme.
D U M B A L L S RO A D
Vastint (part of the IKEA Group) has bought 24 acres comprising the Embankment site on Dumballs Road where it plans to build a mixed-use scheme including new and affordable housing. The site previously had planning consent for 2,000 homes.
T R A N S P O RT I N T E RC H A N G E
Adjacent to Central Square is the Interchange site, a former car park site now the subject of a £100m mixed-use scheme. It will become Cardiff’s Central bus interchange and also provide ground floor retail facilities, residential accommodation and 80,000 sq ft of offices in a 14-storey building.
Ty Admiral – Cardiff
The building comprises two levels of basement car parking, two ground floor double height retail units, a third retail unit, office and reception areas, a mezzanine level plus 11 upper floors of office accommodation. The office space benefits from small atria features incorporated on alternating floors on the north and south elevations.
The building provides a total floor area of approximately 206,833 sq ft with offices accounting for around 202,971 sq ft and the retail 3,862 sq ft. The office floorplates typically provide circa 17,100 sq ft of open plan accommodation around a central core with excellent natural daylight.
The elevations are of Portland stone coloured pre-cast concrete framing plus glazed and aluminium curtain walling together with extruded aluminium fins to provide solar shading with flat roofs which are part terraced/paved with views over central Cardiff. The building is of steel frame structure around a central core and in-situ concrete slabs on metal decking and the internal walls are of concrete blockwork, plasterboard and metal or timber studs with acoustic treatment.
Internally the building provides fully accessible raised floors with a minimum 150mm clear void and suspended ceilings throughout. The offices provide a clear floor to ceiling height of circa 2.80 metres and floor level height of 3.96 metres.
The building, arranged around one central core, contains three stairwells two serving all floors and a third serving ground, mezzanine and first floors only. Male, female and disabled WCs together with seven lifts are all provided within the main building core. In addition one lift in the main office is allocated as the service/goods lift accessing all office floors, ground floor and the upper basement level.
The building benefits from a four pipe fan coil air conditioning system to meet the heating and cooling loads of the building. Chillers are located on the roof together with air conditioning units. The fresh air is provided by the air handling units delivered via duct work into the accommodation via ceiling mounted grills. Air is extracted from the office areas through dedicated extractor grills in the suspended ceiling. A high quality lighting scheme has been provided to the entrance reception, atrium areas together with lighting to common parts.
The building benefits from a fire detection system to include sprinklers on the ground and all upper floors, an alarm system, together with lightning protection system. The building benefits from mains electricity, gas, telecoms and water services.
Externally, the building is paved and lit to match the surrounding public landscaped areas.
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DESCRIPTION
Ty Admiral is a highly specified landmark office building in the heart of central Cardiff with a BREEAM rating of ‘Excellent’. The fourteen storey building was completed in November 2014 as a design and build for Admiral Group Plc’s new corporate headquarters.
PR
OP
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TY
• Typical upper floorplate of 17,100 sq ft (NIA)
• Designed for a maximum occupancy of 3,000
• Seven passenger lifts arranged in two separate banks of which six have a loading capacity of 1,600 kg (21 people) and a seventh with a loading capacity of 1,275 kg (17 people)
• Upper basement loading bay facility
• Floor to ceiling height of 2.80 metres in main office areas
• Floor level heights of 3.96 metres in main office areas
• Floor loadings at 3.0 kn/sq m (superimposed load) to the main office floors
• Raised access floors (250mm) to include carpets
• Suspended ceiling tiles to offices are mineral fibre
• High quality lighting systems throughout with LED lighting to the atrium/reception areas and LG7 lighting to the main office accommodation
• Four pipe fan coil high efficiency air conditioning
• Sophisticated BMS control system
• Solar control glazing and solar shading
• Male and female WCs (six each per main office floor) plus disabled WCs provided on all floors
• Secure basement car parking providing 120 spaces including 4 disabled (1: 1,691 sq ft) together with cycle racking and motorbike parking
• High quality external environment and landscape
• Photovoltaic electrical generating system to meet carbon reduction targets
The main design features and landlord base build specification include:
Ty Admiral – Cardiff 14 | 15
SPECIFICATION
The property has been measured in accordance with both the RICS Code of Measuring Practice (6th Edition) and the Funding Agreement by Plowman Craven providing the following internal floor areas:
Ty Admiral – Cardiff 18 | 19
ACCOMMODATION
FLOOR USE NET INTERNAL AREAS FUNDING AGREEMENT AREAS
(SQ M) (SQ FT) (SQ M) (SQ FT)
Level 11 Office 1,578.7 16,993 1,589.8 17,112
Level 10 Office 1,574.1 16,943 1,585.5 17,066
Level 9 Office 1,579.6 17,003 1,590.7 17,122
Level 8 Office 1,573.8 16,940 1,585.7 17,068
Level 7 Office 1,578.3 16,989 1,589.5 17,109
Level 6 Office 1,572.5 16,926 1,583.8 17,048
Level 5 Office 1,578.3 16,989 1,589.7 17,111
Level 4 Office 1,573.5 16,937 1,584.6 17,056
Level 3 Office 1,579.0 16,996 1,589.9 17,114
Level 2 Office 1,574.1 16,943 1,585.3 17,064
Level 1 Office 1,616.7 17,402 1,624.3 17,484
Mezzanine Comms/Ancillary 403.1 4,339 676.2 7,279
Ground Reception/Office 652.7 7,025 681.7 7,338
SUB TOTAL 18,434.4 198,425 18,856.7 202,971
Ground Retail A 253.9 2,733 253.9 2,733
Ground Retail B 73.6 792 73.6 792
Ground Retail C 31.3 337 31.3 337
SUB TOTAL 358.8 3,862 358.8 3,862
TOTAL 18,793.2 202,287 19,215.5 206,833
The property has been measured in accordance with both the RICS Code of Measuring Practice (6th Edition) and the Funding Agreement. Copies of both measured surveys, undertaken by Plowman & Craven, are provided within the data room and are capable of being assigned and relied upon by the purchaser.
The property has also been measured in accordance with the new RICS Property Measurement (1st Edition), which incorporates the new International Property Measurement Standards (IPMS). The measured surveys have been undertaken by Plowman Craven, copies of which are provided within the data room and are capable of being assigned and relied upon by the purchaser.
The property comprises a site of 0.236 hectares (0.58 acres).
G RO U N D F L O O R 11,200 sq ft (1,040.5 sq m)
L E V E L S 2 , 4 , 6 , 8 & 1 0 17,048 - 17,068 sq ft (1,583.8 - 1,585.7 sq m)
Floor plans are not to scale and for indicative purposes only and the floor areas are based upon the Funding Agreement. A copy of the floor plans is available in the data room. Floor plans are not to scale and for indicative purposes only and the floor areas are based upon the Funding Agreement. A copy of the floor plans is available in the data room.
M E Z Z A N I N E F L O O R 7,279 sq ft (676.2 sq m)
L E V E L S 3 , 5 , 7 , 9 & 1 1 17,109 - 17,122 sq ft (1,589.5 - 1,590.7 sq m)
Ty Admiral – Cardiff 18 | 19
BR
IDG
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STR
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Retail ARetail B
Retail C
BR
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VID
STR
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BR
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K E Y
OFFICES
LIFTS
RETAIL
CORE
K E Y
OFFICES
LIFTS
CORE
FLOOR PLANS
Ty Admiral – Cardiff
TENURE
The property is held on a 250 year lease at a peppercorn from 22nd March 2012 and expiring on 21st March 2262.
The freeholder is the County Council of the City and County of Cardiff.
The tenant is obliged to keep the property in good repair, insured and to pay future rates, taxes and other impositions in respect of the property.
The headlease has a wide permitted use that includes offices and ancillary uses within Class B1 and/or any use within Classes A1, A2, A3 or C3 as well as any other uses, subject to landlord’s reasonable consent.
The title number is CYM554643.
9.4m
9.4m
LB
TCB
TCB
Line of Posts
Posts
rrace
BRIDGE STREET
MARY ANN STREET
MILLIC
ENT STR
EET
LOVE LANE
TREDEGAR STREET
BARRACK LANE / LON Y BARICS
HEOL DAVID/ DAVID STREET
Car Park
El Sub StaCENTRAL
El Sub Sta
Multi Car Pk
1
Ivor House
Shelters
53
Ty Admiral
PH
3
Motorpoint Arena Cardiff
Job Centre
The Chapel
54
4
9
BarrackLane
Apartments
1
4
2
5
0m 10m 20m 30m
Ordnance Survey © Crown Copyright 2018. All rights reserved. Licence number 100022432. Plotted Scale - 1:1250
C A R D I F F Q U E E N S T R E E T S TAT I O N
Not to scale. For identification purposes only. This plan is based upon the Ordnance Survey Map with the sanction of the controller of H.M. Stationery Office. Crown Copyright.
P R I N C I PA L I T Y S TA D I U M
J O H N L E W I SS T M A R Y S T R E E T
C A R D I F F C E N T R A L L I B R A R Y
Q U E E N S T R E E TQ U E E N S A R C A D E
T H E H AY E SC A R D I F F C A S T L E
M O T O R P O I N T A R E N A
S T D AV I D S S H O P P I N G C E N T R E
TE
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EN
AN
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Ty Admiral – Cardiff 22 | 23
TENANCY TENANT COVENANT
The key terms of the lease are as follows:
TENANT EUI Limited (Company No. 02686904)
GUARANTOR Admiral Group Plc (Company No. 03849958)
TERM 25 years from 15th September 2014 expiring on 14th September 2039
DEMISE Whole building to include basement levels of car parking, the internal and external envelope of the building together with hard and soft landscaping to the footprint of the building (see OS plan)
RENTAL The initial rent is £3,439,673 per annum (the vendor will top up the rent to £3,705,560 per annum until 15th September 2019)
RENT PER SQ FT
£16.75 per sq ft on the main office area, £13.00 per sq ft on the mezzanine area and £16.75 per sq ft on the ground floor retail units, based upon initial rental
RENT REVIEW DATES
15 September 2019, 2024, 2029 and 2034
RENT REVIEW The rent is to be reviewed on a 5 yearly upward only basis to the Retail Price Index (RPI) with a collar and cap at 1.5% and 3% respectively compounded annually
REPAIR Full repairing and insuring lease
ALIENATION The ability to assign or underlet the whole or underlet parts with landlord’s consent not to be unreasonably withheld, subject to an Authorised Guarantee Agreement
USE The permitted use is a combination of offices and ancillary uses within Class B1; and/or A2; and in respect of the ground floor and any mezzanine level Classes A3; and in respect of Retail Units Class A1
R E N TA L T O P U P
The vendor will top up the rental to the 15th September 2019 rent review based upon the minimum uplift of 1.5% per annum compounded, which equates to £3,705,560 per annum.
Oxford Economics project average RPI growth of 3.15% per annum for the 20 year period following the September 2019 rent review.
U N D E R L E T T I N G S ( R E TA I L )
Retail A is let to Stable Bar Restaurant on a 15 year lease from 2nd October 2015 at a passing rental £70,000. Retail B is let to NSSB Cardiff Limited (trading as ‘Bru’) on a 10 year lease from 9th March 2018 at a passing rent of £25,000. E U I L I M I T E D ( T E N A N T )
EUI Limited is the principal subsidiary of the Admiral Group Plc, which offer services in direct motor insurance brokerage and providing other shared group facilities to the organisation.
EUI Limited have a Dun & Bradstreet rating of 5A1, which represents a minimum risk of business failure.
Since its launch in January 1993, the Admiral Group has become a highly profitable and fast-growing financial services company, now employing over 9,000 people across its offices in the UK.
Admiral entered a new phase in 2004 when it floated on the London Stock Exchange. The float represented the biggest capital raising for a Welsh company ever and Admiral Group became the highest valued public company in Wales. In December 2007 Admiral became the second Welsh company to join the FTSE Top 100 Companies.
The Admiral Group offers home, car and travel insurance, as well as personal loans and car finance in the UK. The company has operations in France, Italy, Spain, USA, Canada, India and Mexico. Admiral’s customer base includes higher premium business, such as city-dwellers, younger drivers and motorists with performance cars; people who traditionally found it difficult to get motor insurance from the main volume providers.
ADMIRAL GROUP PLC FISCAL FISCAL FISCAL
NON CONSOLIDATED NON CONSOLIDATED NON CONSOLIDATED
31-DEC-17 31-DEC-16 31-DEC-15
(£000’S) (£000’S) (£000’S)
Turnover £2,960,100 £2,580,000 £2,120,000
Profit Before Taxes £403,500 £278,400 £368,700
Tangible Net Worth £496,400 £419,400 £490,600
Customer numbers 5.73M 5.15M 4.43M
EUI LIMITED FISCAL FISCAL FISCAL
NON CONSOLIDATED NON CONSOLIDATED NON CONSOLIDATED
31-DEC-16 31-DEC-15 31-DEC-14
(£000’S) (£000’S) (£000’S)
Turnover £167,415 £162,235 £180,712
Profit Before Taxes £236,124 £315,529 £305,992
Tangible Net Worth £98,332 £51,473 £151,006
Admiral Group operates 15 brands around the world, including the following UK brands:
Since the launch of Admiral 25 years ago, they have posted ‘record profits’ on 23 separate occasions. During 2016, the Admiral Groups customer numbers exceeded 5million for the first time and now stands at around 5.73million. All of Admirals growth has been organic, with customer numbers increasing every year from the company’s inception in 1993, through to 2017.
Admiral Group Plc released results for the year ending 31st December 2017, with record profits coupled with continued strong growth. Profit before tax was £403.5 million, a jump of 43% compared to 2016, whilst turnover rose 15% to £2.96 billion. Dun & Bradstreet ascribed a credit rating of 5A1 representing their top credit rating and lowest level of overall risk with a minimum risk of business failure.
Admiral Group Plc have an investment grade covenant with a Moody’s credit rating of A1.
A D M I R A L G RO U P P L C ( G U A R A N T O R )
Ty Admiral – Cardiff 24 | 25
Cardiff is the principal office market within Wales, and one of the major regional centres in the UK, with an estimated office stock of approximately 11 million sq ft. The central Cardiff office market is made up of three distinct areas, the CBD, surrounding Cardiff Central railway station, Cardiff Waterside and the out of town business parks.
CARDIFF OFFICE LETTING MARKET
Currently, the city centre office market is focused around Central Square, Callaghan Square and Capital Quarter which together extends to circa 700,000 sq ft of Grade A office accommodation. 2017 saw record office take-up figures reaching 703,926 sq ft following on from a previous record year in 2016 of 685,640. The 10-year average office accommodation take-up figure now stands at 510,000 sq ft.
Central Square is being developed by Rightacres and Cardiff City Council with forward funding from Legal & General. The first phase of office development, One Central Square, completed in 2016 and is fully let with new headline rents at £25.00 per sq ft for the city being secured. In addition, the BBC have committed to occupying a new 165,000 sq ft Foster & Partners designed office building, with completion due in 2018 and Hugh James Solicitors (100,000 sq ft) and Cardiff University (45,736 sq ft) take occupation of Two Central Square in Q4 2018 also let at £25.00 per sq ft.
Cardiff Waterside is dominated by the National Assembly for Wales which occupies Crickhowell House (Tŷ Hywel) along with the Senedd which houses the debating chamber and committee rooms.
Headline rents at Cardiff Waterside are currently at £23.00 per sq ft. Office demand within Cardiff Bay is driven by the ongoing expansion of National Assembly for Wales’ Role, the Creative Arts Sector expansion and inward investment by new occupiers being drawn to the city.
The profile of Cardiff Bay continues to grow as leisure based activities, focused around the Welsh Millennium Centre (WMC) and Mermaid Quay rises. The WMC is now seen as the centre of Creative Arts in Wales while the BBC’s Drama Village is establishing the Bay as a location for media production companies. The development of a rapid transport link between Cardiff’s waterfront and city centre remains on the agenda for both Welsh Government and Cardiff Council.
Grade A supply is at a low level in the city at around 100,000 sq ft available in the city centre. This equates to approximately 5.3 months of Grade A supply based on historic take-up levels. The lack of Grade A supply has encouraged further development in the city, No 3 Capital Quarter (75,000 sq ft) and No 4 Capital Quarter (100,000 sq ft), both under construction and expected to be delivered in early 2018.
Cardiff was the only major regional UK office market to see growth in headline rents during the downturn with rents rising in 2009 to £21.00 per sq ft and £22.00 per sq ft in 2012. This has now grown further in 2016 to £25.00 per sq ft, still well below nearby Bristol (£32.50 per sq ft) and Birmingham (£31.50 per sq ft). Quoting rents on the latest development of Grade A buildings at Central Quay (The Ledger Building) are set to be £27.00 per sq ft.
T H E F U T U R E
Cushman & Wakefield are aware of Grade A office requirements in excess of 300,000 sq ft for central Cardiff, which coupled with the ongoing lack of Grade A supply and low rents relative to other major regional centres, points to further rental growth going forward. This trend has prompted the development of No.3 and No.4 Capital Quarter along with the planning application for The Ledger Building at Central Quay.
R E N T – S T E A D Y G RO W T H S I N C E 2 0 1 1Prime Headline Rents now set at £25 per sq ft at One Central Square
C A R D I F F T O TA L O F F I C E TA K E - U P ( S Q. F T ) , L A S T 8 Y E A R S B Y L O C A T I O N
BUILDING TENANT AREA (SQ FT) RENT (PER SQ FT) TERM DATE
No.3 Capital Quarter Which? Limited 11,550 £24.00 10 Mar-18
HMRC Building HMRC 269,228 Confidential 25 Aug-17
Two Central Square Cardiff University 45,736 £25.00 25 Mar-17
Two Central Square Hugh James Solicitors 100,000 £25.00 15 Dec-16
One Central Square Hodge Bank 16,633 Confidential 15 Aug-16
One Central Square Motonovo Finance 73,500 £25.00 15 Aug-16
BBC Wales HQ BBC 165,000 £24.00 20 Dec-15
800,000
700,000
600,000
500,000
400,000
300,000
200,000
100,000
0
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
545,000
400,000
550,000530,000
425,000
380,000
440,000
635,000
369,000
298,000
542,519
616,000
685,640703,926
10 Y
EA
R A
VE
RA
GE
30
25
20
15
2011 2012 2013 2014 2015 2016 2017 2018
600,000
500,000
400,000
300,000
200,000
100,000
0
2010 2011 2012 2013 2014 2015 2016 2017
239,099
135,978
60,274
475,495
114,978
38,827
191,772
78,505
99,465
183,050
57,215 57,160
268,684
210,931
62,904
451,022
123,163
41,824
477,612
166,793
41,235
587,932
79,144
36,850
C A R D I F F T O TA L O F F I C E TA K E - U P, L A S T 1 4 Y E A R S ( Including Bay, City Centre & Out of Town)
K E Y
CITY CENTRE
OUT OF TOWN
BAY
MA
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ET
Ty Admiral – Cardiff 26 | 27
Investment into Cardiff offices totalled around £290 million in 2017, with overseas investors accounting for just over 40% of total investment. This investor demand was particularly notable with the sales of One and Two Central Square, which both secured strong interest from a diverse range of investors, including UK Pension Funds, Opportunity Funds and overseas investors.
Domestic and overseas investors are expected to continue to target high quality regional investment stock over the short to medium term, with a lack of available stock continuing to be the main barrier to entry. Markets with significant infrastructure improvements, a buoyant private and public sector and a lack of Grade A stock are expected to remain particularly sought-after, with genuine rental growth anticipated.
Demand for long income annuity style investments has grown strongly over the past few years as pension funds and annuity providers have sought to match liabilities with RPI linked investments let to strong covenants. Given the trend towards shorter leases the market is not naturally catering towards this product, and much of this stock is therefore having to be created through sale and leaseback, or more frequently new development.
The investment market for high quality regional office investments remains very strong, characterised by high volume of UK and overseas capital being constrained by a lack of appropriate stock. Total volumes
in 2017 across the top 10 regional markets exceeded £3.3bn, well ahead of the long-term average, with overseas investors the most active, attracted by the UK’s political stability and favourable exchange rates. Investors are
principally targeting modern, well located offices situated in core locations with strong tenant demand and limited speculative development, such as Cardiff.
UK INVESTMENT MARKETADDRESS PRICE NIY CV
(PER SQ FT)TENANT LEASE TERMS AREA
(SQ FT)DATE PURCHASER
India HouseLiverpool
£125.00M 3.74% £400 HMRC 21 years term certain with 5 yearly RR linked to RPI with a cap and collar of 0%-4% pa compounded with year 20 to MR.
314,610 Mar-18 L&G
Premier InnCustom House StreetCardiffFUNDING
£34.00M 4.06% – Premier Inn Hotels Ltd with guarantee from Whitbread Group Plc
20 years term certain with 5 yearly RR linked to RPI with a cap and collar of 0%-4% pa compounded.
- Dec-17 Aviva Investors
NHS Car ParkBircham ParkPlymouth
£32.20M 2.60% – Plymouth Hospitals NHS Trust
35 year lease with annual RR linked to RPI with a cap and collar of 2%-5% pa compounded.
- Dec-17 Aviva Investors
GPUCentral SquareCardiffFUNDING
£133.20M 3.54% £445 Government Property Unit
25 year lease with 5 yearly RR linked to RPI with a cap and collar of 0%-4% pa compounded.
265,000 Sep-17 L&G
Peninsula & Fernworthy HouseExeter
£43.87M 3.30% £465 South West Water
30 year lease with 5 yearly RR linked to RPI with a cap and collar of 1%-4% pa compounded.
94,158 May-17 British Steel
AtkinsWoodcote GroveLiverpool
£47.60M 4.10% £504 Atkins Limited 25 year lease with annual RR linked to RPI with a cap and collar of 0%-4% pa.
92,613 Jan-17 L&G
3 Glass WharfBristolFUNDING
£72.65M 4.04% £653 HMRC 25 year lease with 5 yearly RR linked to RPI with a cap and collar of 0%-4% pa compounded.
114,830 Nov-16 L&G
A N N U I T Y / L O N G I N C O M E T R A N S A C T I O N S
ADDRESS PRICE NIY CV (PER SQ FT)
TENANT(S) LEASE TERMS AREA (SQ FT)
DATE PURCHASER
1 Callaghan Square Cardiff
Quoting £26.40M
Quoting 6.50%
£282 Eversheds Sutherland LLP
AWULT of 4 years 93,670 U/O U/O
2 Callaghan Square Cardiff
Quoting £14.88M
Quoting 5.97%
£329 Allied Irish Bank, Church of Wales & AON
AWULT of 4.5 years 45,208 Mar-18 Daily Mail Pension Fund
2 Capital Quarter Cardiff
£23.20M 6.40% £274 Cardiff University & Hugh James LLP
AWULT of 7.5 years 84,759 Dec-17 Tesco Pension Fund
One Central Square Cardiff
£51.00M 5.50% £378 Motonovo Finance & Studio Tri
AWULT of 9.5 years 135,333 Jul-17 Aerium
Two Central Square Cardiff
£56.60M 6.25% £418 Hugh James & Cardiff University
AWULT of 18.1 years 145,736 Oct-16 Credit Suisse Asset Management
3&4 Callaghan Square Cardiff
£32.13M 6.13% £287 British Gas, Zurich Insurance & British Transport Police
AWULT of 7.93 years 112,024 Jan-16 Deutsche Asset Management
C A R D I F F I N V E S T M E N T T R A N S A C T I O N S
Ty Admiral – Cardiff
D E B T O P P O RT U N I T Y
This asset is an attractive opportunity for traditional lenders. Indicative lender interest has already been expressed, drawn by the property’s prime location, long-term secure income and good quality office accommodation.
The following headline financial terms should be achievable for an asset of this profile:
Our Cushman & Wakefield Debt & Structured Finance team are available to assist with debt terms and sourcing of capital. Please contact:
James Spencer-Jones [email protected] +44 (0)20 7152 5524
VA T
We understand that the property is elected for VAT and therefore VAT will be payable on the purchase price.
E N V I RO N M E N TA L P E R F O R M A N C E
The property has been assessed with a BREEAM rating of ‘Excellent’. A copy is available in the data room.
The property has been assessed with an EPC rating of B 34. A copy is available in the data room.
C A P I TA L A L L O W A N C E S
It is anticipated that any capital allowances may be available to qualifying parties. Further details of these, are available in the data room.
D A TA RO O M
Data room access can be provided upon request, which contains the following information:
• Corporate Information• Title Documents• Occupational Documents• Reports (inc. Measured Survey, Environmental Survey, Capital Allowances
& D&B Reports)• EPC• Construction Documents• Management Information
ADDITIONAL INFORMATION
HEADLEASE SUMMARY
D A T E
22 March 2012 L A N D L O R D
The County Council of the City and County of Cardiff T E N A N T
Immo UK Admiral Cardiff S.à r.l.
T E R M
250 years from and including 22 March 2012. P R E M I S E S
The land and the buildings constructed on it at Bridge Street and David Street, Cardiff known as Admiral House, David Street, Cardiff CF10 2EH.
U S E R
Office and ancillary uses within Class B1 and/or any use within Class A1, A2, A3 or C3 of the Town and Country Planning (Use Classes) Order 1987.
R E N T
A peppercorn. A L I E N A T I O N
Assignment and underletting is permitted without Landlord’s consent.
R E PA I R
The Tenant is obliged to keep the property in repair and to use reasonable endeavours to keep the external areas of land, roads, entrances or pavements forming part of the property in a clean and tidy condition. A L T E R A T I O N S
There are no restrictions on alterations (including structural and external alterations) other than a requirement for the Tenant to obtain and comply with all necessary planning permissions and any other permits and consents required under statute. Landlord’s consent is not required for any alterations.
I N S U R A N C E
The Tenant is responsible for keeping the building on the property insured for its full reinstatement cost with an insurance office of repute.
28 | 29
LTV 55% 60%
“All In” interest costs (assuming 5-year
SWAP rate of 1.35% as at May 2018)
2.95% - 3.10% 3.10% - 3.25%
Ty Admiral – Cardiff
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PROPOSAL
We are instructed to seek offers in excess of £80,900,000 for the entire share capital in Immo UK Admiral Cardiff S.à.r.l that owns the property, subject to contract and exclusive of VAT.
This reflects a net initial yield of 4.50% (assuming acquisition costs of 1.80%). This reflects a low capital value of £391 per sq ft.
Ty Admiral, Cardiff is part of the Amundi Collection of eight UK properties located in London, Glasgow and Cardiff. These assets are available individually or as a portfolio.
Full details can be found at www.amundicollection.com
CONTACTS
For further information or to arrange a viewing, please contact:
N I C K A L L A N
T: +44 (0)117 910 5282
M: +44 (0)7803 891 705
A N D R E W G I B S O N
T: +44 (0)2920 262 246
M: +44 (0)7834 449 163
B E N C O O K
T: +44 (0)20 3296 3632
M: +44 (0)7958 902 023
J A S O N W I N F I E L D
T: +44 (0)20 3296 2116
M: +44 (0)7768 695 126
Important Notice
Cushman & Wakefield gives notice to anyone who may read these particulars as follows:
1. These particulars are prepared for the guidance only of prospective purchasers. They are intended to give a fair overall description of the property but are not intended to constitute part of an offer or contract.
2. Any information contained herein (whether in the text, plans or photographs) is given in good faith but should not be relied upon as being a statement or representation of fact.
3. Nothing in these particulars shall be deemed to be a statement that the property is in good condition or otherwise nor that any services or facilities are in good working order.
4. The photographs appearing in this brochure show only certain parts and aspects of the property at the time when the photographs were taken. Certain aspects may have changed since the photographs were taken and it
should not be assumed that the property remains precisely as displayed in the photographs. Furthermore no assumptions should be made in respect of parts of the property which are not shown in the photographs.
5. Any areas, measurements or distances referred to herein are approximate only.
6. Where there is reference in these particulars to the fact that alterations have been carried out or that a particular use is made of any part of the property this is not intended to be a statement that any necessary planning,
building regulations or other consents have been obtained and these matters must be verified by any intending purchaser.
7. Descriptions of a property are inevitably subjective and the descriptions contained herein are used in good faith as an opinion and not by way of statement of fact.
8. All photographs are for indicative purposes only.
June 2018
