+ All Categories
Home > Documents > Well Secured, Food Store Anchored, Freehold Retail … · bearwood shopping centre, smethwick,...

Well Secured, Food Store Anchored, Freehold Retail … · bearwood shopping centre, smethwick,...

Date post: 29-Jun-2018
Category:
Upload: trinhnguyet
View: 219 times
Download: 0 times
Share this document with a friend
11
bearwood shopping centre, smethwick, birmingham B66 4BH Well Secured, Food Store Anchored, Freehold Retail Investment
Transcript

bearwood shopping centre, smethwick, birmingham B66 4BH

Well Secured, Food Store Anchored, Freehold Retail Investment

Well Secured, Food Store Anchored, Freehold Retail Investment Bearwood Shopping Centre, Smethwick, Birmingham B66 4BH

Investment Summary | Location & Communications | Local Ecomony & Demographic Profile | Retailing in Bearwood | The Bearwood Shopping Centre |Accommodation | Tenure | Tenancies | Current Income & Analysis | Property Management & Service Charge | VAT | EPC | Proposal | Further Information |

2

BEARWOOD ROAD (A4030)

RU

TLAND

RO

AD

S

ANDON ROAD (B4125)

POPLAR ROAD

ST

MA

RY’

S R

OA

D

For illustrative purposes only

Well Secured, Food Store Anchored, Freehold Retail Investment Bearwood Shopping Centre, Smethwick, Birmingham B66 4BH

Investment Summary | Location & Communications | Local Ecomony & Demographic Profile | Retailing in Bearwood | The Bearwood Shopping Centre |Accommodation | Tenure | Tenancies | Current Income & Analysis | Property Management & Service Charge | VAT | EPC | Proposal | Further Information |

3

INVESTMENT SUMMARY■ A prominent and substantial retail parade situated within the

busy Birmingham suburb of Smethwick

■ 5,413m² (58,268 sq.ft) comprising a food store, 9 retail units and 120 space surface car park

■ An extensive site comprising circa 2.35 acres

■ Well secured to a variety of popular national multiple retailers including Aldi, Argos, Poundland, Greggs, Card Factory and Lloyds Pharmacy

■ Freehold

■ Average weighted unexpired lease term (AWULT) of 10.5 years to expiry

■ Asset management opportunities

■ Low base rental tone

■ Offers in excess of £8,650,000 (Subject to Contract and Exclusive of VAT)

■ Reflecting an attractive net initial yield of 7.5%

Well Secured, Food Store Anchored, Freehold Retail Investment Bearwood Shopping Centre, Smethwick, Birmingham B66 4BH

Investment Summary | Location & Communications | Local Ecomony & Demographic Profile | Retailing in Bearwood | The Bearwood Shopping Centre |Accommodation | Tenure | Tenancies | Current Income & Analysis | Property Management & Service Charge | VAT | EPC | Proposal | Further Information |

4

Location & CommunicationsBearwood is a thriving commercial and residential suburb and forms the

southern part of Smethwick to the north of the Hagley Road (A456). The

town is centred on Bearwood Road at the crossroads of Sandon Road and

Three Shire Road, bordering the city centre, 4 miles (6.4 km) to the east. The

town also benefits from excellent communications strategically lying within

the motorway network which skirts the city (M5, M6, and M42). Bearwood

is approximately 117 miles (188km) north-west of London and 84 miles

(135km) south of Manchester.

Smethwick benefits from direct, frequent train services into Birmingham

New Street (8 minutes) and Birmingham Moor Street (13 minutes) every

10 minutes. New Street station is 80 minutes from London Euston and 90

minutes from Manchester Piccadilly with trains running every 20 minutes.

A frequent train service also provides access to Birmingham airport in a

journey time of 30 minutes. The airport attracts over 9 million passengers a

year, making it the 7th busiest airport in the UK. The proposed HS2 railway

will indirectly benefit the subject location as it will link London to Birmingham

in a journey time of circa 49 minutes.

A45A45

A41

A34A452

A452

A453

A435

A441

A441

A441

A435A446

A448

A491

A456

A456

A449

A449

A491

A449

A450

A452

A452

A454

A4177

A38

A456A4123

A4123

A4123

A458

A41

A41 A38

A34

A5

A5

M5

M6

M6 Toll

M5

M5

M6

M6

M6

M42

M42

M42

M40

M40M40

BIRMINGHAM

Bromsgrove

Redditch

Solihull

Stourbridge

DudleyWest

Bromwich

WolverhamptonWalsall Sutton

Coldfield

Kenilworth

Marston Green

Kingsbury

Knowle

Yardley

King’s Heath

Castle Bromwich

Aldridge

Wombourne

Coleshillsmethwick

A4040

A4030

A4092

A4040

B4125

A457

B4136

A457A457B4182

A4123A4123

B4121

B4166

B4125

B4129

A457

A41

A41

A34

A4123

A456

A456

A441

A456

A456

A456

A4123M5

M5

M5

M5

A38(M)

BIRMINGHAM

Bearwood

Handsworth

West Bromwich

Oldbury

Hurst Green

Harborne

SmethwickHockley

Wit ton

Ladywood

EgbastonQuinton

bearwood shopping centre

click on the map to view in Google Maps

Well Secured, Food Store Anchored, Freehold Retail Investment Bearwood Shopping Centre, Smethwick, Birmingham B66 4BH

Investment Summary | Location & Communications | Local Ecomony & Demographic Profile | Retailing in Bearwood | The Bearwood Shopping Centre |Accommodation | Tenure | Tenancies | Current Income & Analysis | Property Management & Service Charge | VAT | EPC | Proposal | Further Information |

5

Local Economy & Demographic ProfileSmethwick forms part of Sandwell Metropolitan District having a resident

population of 55,000 (2011 Census) and circa 200,000 persons residing

within a 10 minute drive time. The area has a diverse and eclectic population

mix and demographic profile with a high representation of 25-34 year olds

and a high proportion within the socio-economic group C1.

Manufacturing dominates Smethwick’s employment sector representing 26%

of the workforce with a number of company headquarters situated in the area

including Interlink Express, a major employer who have been located in the

town since the early 2000s. The Smethwick area is set to benefit greatly from

important regeneration projects specifically the development by SWBH NHS

Trust of a new Midland Metropolitan Hospital. The £353m project will create

a ‘state of the art’ 670 bed hospital on a substantial brown field site, north of

Bearwood, amalgamating the Sandwell General Hospital at West Bromwich and

the City Hospital on Dudley Road. Construction work will commence in 2016

with completion due in 2019.

Retailing in Bearwood Retailing in the area is focussed on Bearwood Road. The busy pitch in a

densely populated residential area is well suited to its convenience led offer.

National multiple occupiers represented adjacent and near to the subject

property include Iceland, Select, Superdrug, Peacocks, NatWest, Holland

& Barrett, Lloyds Bank, Greggs, Co-operative, Barclays and Paddy Power.

The Bearwood Shopping CentreThe property occupies a 100% prime retailing pitch on Bearwood Road and

comprises an Aldi food store (part sublet to Argos) and an ‘unbroken’ retail

parade of 9 adjoining units which are arranged over ground (retail) and first

floors (ancillary). The car park to the rear of the property (demised to Aldi) is the

main 120 space surface car park in Bearwood and links directly via a covered

pedestrian passageway through the subject property to Bearwood Road. Aldi/

Argos also benefit from a separate loading bay and service area accessed via

Rutland Road with servicing for the other retail units accessed through the car

park whose entrance is also on Rutland Road. There is also a public toilet and a

substation onsite.

Well Secured, Food Store Anchored, Freehold Retail Investment Bearwood Shopping Centre, Smethwick, Birmingham B66 4BH

Investment Summary | Location & Communications | Local Ecomony & Demographic Profile | Retailing in Bearwood | The Bearwood Shopping Centre |Accommodation | Tenure | Tenancies | Current Income & Analysis | Property Management & Service Charge | VAT | EPC | Proposal | Further Information |

6

STORE TWENTY

ONE

Card Factory

Lloydspharmacy

This Goad Plan is for identification only and not to be scaled as working drawing. No part of this plan may be entered into an electronic retrieval system without prior consent of the publisher. © Crown copyright 2010. Licence number PU100017316. For full terms and of copyright conditions visit www.goadplans.co.uk/copyright

Well Secured, Food Store Anchored, Freehold Retail Investment Bearwood Shopping Centre, Smethwick, Birmingham B66 4BH

Investment Summary | Location & Communications | Local Ecomony & Demographic Profile | Retailing in Bearwood | The Bearwood Shopping Centre |Accommodation | Tenure | Tenancies | Current Income & Analysis | Property Management & Service Charge | VAT | EPC | Proposal | Further Information |

7

AccommodationThe property provides an approximate total floor area of 5,413 m² (58,268 sq.ft) as set out in the Tenancy Schedule.

ADDRESS TENANT

AREAS Lease Start

DateLease Expiry

DateOption To

Break Next RR Current Rent

Service Charge April 2015/ March 2016 RV

Rates Payable

@ £0.482 CommentsDescription Sq. Ft. M²

545/565 Bearwood Rd (Unit A) ALDI STORES LIMITED GF (GIA) 14,697 1,365 24/10/2005 23/10/2030 23/10/2020 (T) 24/10/2015 £300,000 £14,485.07 £203,000 £97,846 Aldi report positive like for like trading. Argos sublease 15 yrs from 31/10/07. Exp. 30/10/22@£98,000pa. Argos Tenant break option 31/10/17. 120 space car park to the rear demised to Aldi. Lease Plan available on request. No RRM for Argos

1st (GIA) 1,824 169

Argos (part sublet) GF (sublet) 10,281 955

1st (sublet) 2,095 195

567/569 Bearwood Rd POUNDLAND LIMITED GFS 3,788 352 22/08/2012 21/08/2022 22/08/2017 £100,000 £5,600.58 £81,500 £39,283

1st 3,357 312

ITZA 1,959 units

571 Bearwood Rd (Unit 2) ALAN WARWICK LIMITED GFS 995 92 16/05/2005 15/05/2015 £27,000 £1,172.27 £25,500 £12,291

1st 559 52

ITZA 595 units

573 Bearwood Rd (Unit 3) GREGGS PLC GFS 969 90 18/05/2005 17/05/2015 £26,600 £1,172.27 £24,500 £11,809 Tenant recently re-fitted. No LTA

1st 578 54

ITZA 586 units

575 Bearwood Rd (Unit 4) SCRIVENS LIMITED GFS 963 89 15/05/2005 14/05/2020 15/05/2015 £25,750 £1,172.27 £25,500 £12,291 Chose not to exercise TBO on 14/05/2015.

1st 581 54

ITZA 582 units

577 Bearwood Rd (Unit 5) SPORTSWIFT LIMITED GFS 971 90 08/11/2007 07/11/2017 08/11/2012 £32,500 £1,172.27 £24,750 £11,930

1st 574 53

ITZA 588 units

579 Bearwood Rd (Unit 6) STORE TWENTY ONE GFS 1,793 167 27/01/2015 26/01/2025 27/01/2020 (T) 27/01/2020 £41,000 £2,097.22 £40,750 £19,642 Service charge capped at current level plus RPI uplifts. At rent review the tenant's liability is capped to £45,000 pax. By way of a personal side letter the tenant pays monthly in advance. TBO in 5th year subject to 6 month rent penalty. Tenant was given 12 months rent free to be topped up by the vendor. 1st 860 80

ITZA 941 units

581 Bearwood Rd (Unit 7) LLOYDS PHARMACY LIMITED GFS 1,827 170 05/03/2004 04/03/2019 £42,750 £2,100.97 £40,000 £19,280

1st 857 80

ITZA 949 units

583 Bearwood Rd (Unit B) LEVINE BROTHERS (HOME FURNISHINGS) LTD

GFS 5,491 510 05/12/2005 04/12/2025 04/12/2020 (T) 05/12/2020 £90,000 £8,542.09 £84,000 £40,488 Break is being removed from 2015 to 2020 and term extended to 2025. Rent has reduced from £90,900 pax to £90,000 pax and tenant given 6 months rent free. RR in 12/2015 is removed. Next RR in 12/2020 is to be capped at £94,500 pax. Expected to complete before sale completes.

1st 5,208 484

ITZA 1,675 units

Public Toilet THE BOROUGH COUNCIL OF SANDWELL

n/a n/a 02/08/2006 01/01/2020 £0 - - -

Sub Station CENTRAL NETWORKS WEST PLC n/a n/a 16/10/2004 15/10/2018 £50 - - -

Total 58,268 Sq.Ft 5,413 M² Gross Passing Rent £685,650.00 £37,515.00

Well Secured, Food Store Anchored, Freehold Retail Investment Bearwood Shopping Centre, Smethwick, Birmingham B66 4BH

Investment Summary | Location & Communications | Local Ecomony & Demographic Profile | Retailing in Bearwood | The Bearwood Shopping Centre |Accommodation | Tenure | Tenancies | Current Income & Analysis | Property Management & Service Charge | VAT | EPC | Proposal | Further Information |

8

Well Secured, Food Store Anchored, Freehold Retail Investment Bearwood Shopping Centre, Smethwick, Birmingham B66 4BH

Investment Summary | Location & Communications | Local Ecomony & Demographic Profile | Retailing in Bearwood | The Bearwood Shopping Centre |Accommodation | Tenure | Tenancies | Current Income & Analysis | Property Management & Service Charge | VAT | EPC | Proposal | Further Information |

9

TenureFreehold.

TenanciesThe Bearwood Shopping Centre provides an eclectic but balanced mix of quality retailers providing a strong convenience

led retail offer. The property is predominantly anchored by Aldi (44% of gross income) who have sublet part to Argos.

Other major national multiple retailer tenants include Poundland, Greggs, Card Factory, Lloyds Pharmacy and Store

Twenty One.

The leases are largely drawn on institutional terms with outgoings recovered through a comprehensive service

charge.

Current Income & AnalysisThe current gross income is £685,650 pax.

44% of the income is secured to Aldi until October 2030 (TBO in 2020). The current Aldi rent devalues to £10.35 psf.

The subject property has an AWULT of 10.5 years to expiry and 5.6 years to break.

79% of the current gross income is let to national covenants.

44% of the income is secured to Aldi Stores Ltd. 79%

is secured to National Multiple tenants”“

21%Let to Local Operators

79%Let to National

Multiple Tenants

Income Profile

The most recent letting within the property was to Store Twenty One (579 Bearwood Road) in January 2015. The

tenant agreed a new 10 year lease with a TBO in year 5 subject to a 6 month rent penalty. The agreed rent of

£41,000 pax devalues to £41.75 psf ZA (Headline). Levine Bros (583 Bearwood Road) has also recently agreed a

lease re-gear removing a TBO in 2020 in exchange for a 6 month rent free period and a reduction in rent to £90,000

pax devaluing to £47.51 psf ZA (Headline). Opposite the property at 546 Bearwood Road, Paddy Power in May 2014

agreed a new 15 year lease at £25,000 pa devaluing to £45.43 psf ZA. Taking this into account we believe there

is a strong argument for future rental growth from this low base level.

21%

44%

14%

6%

6%5%

4%

Local Operators

Card Factory

Aldi

Store Twenty One

Poundland

Lloyds

Greggs

Income Analysis by Tenant

Well Secured, Food Store Anchored, Freehold Retail Investment Bearwood Shopping Centre, Smethwick, Birmingham B66 4BH

Investment Summary | Location & Communications | Local Ecomony & Demographic Profile | Retailing in Bearwood | The Bearwood Shopping Centre |Accommodation | Tenure | Tenancies | Current Income & Analysis | Property Management & Service Charge | VAT | EPC | Proposal | Further Information |

10

Property Management & Service ChargeThe service charge for the property is operated under two schedules with

the tenants having apportioned percentage contributions based on weighted

gross lettable floor area occupied.

The proposed service charge budget for the year ending 31st March 2016

amounts to £37,515 per annum. Aldi contribute 38.6% of this figure. A

service charge report is available upon request.

VATWe understand that the property is elected for VAT.

EPCEnergy Performance Certificates (EPCs) are available on request.

Asset Management Opportunities• Pursue lease renewal discussions with Greggs and Alan Warwick (both

in 2015) to improve the AWULT. Both parties have indicated they want

to stay.

• Negotiate removal of Aldi’s TBO in 2020. Initial discussions suggest

Aldi are receptive to this.

• Approach Card Factory for lease re-gear discussions.

• Increase low rental tone and improve tenant mix through pro-active

asset management.

• Explore break-up value potential for the asset.

• Amalgamate/ extend retail units.

ProposalWe have been instructed to seek offers of £8,650,000 (Eight Million, Six

Hundred and Fifty Thousand Pounds, subject to contract and exclusive

of VAT for the freehold interest reflecting a net initial yield of 7.5% allowing

for purchaser’s costs of 5.8%.

FURTHER INFORMATION

For further information please contact:

David Freeman James Baillie Ed Smith Patrick Over

020 7659 4830 020 7659 4839 020 7659 4831 020 7659 4832

[email protected] [email protected] [email protected] [email protected]

MISREPRESENTATION These particulars do not constitute an offer or contract. They are intended as a guide to prospective purchasers. All reasonable care has been taken in the preparation of these particulars but their accuracy is not guaranteed. The purchaser should satisfy himself and as to the correctness of these details. Neither the agents nor the vendors or lessors are to be or become under any liability or claim in respect of these particulars. These particulars are supplied on the understanding that all negotiations are conducted through this office. March 2015.

Adrian Gates Photography & Design 07710 316991


Recommended