stop Wakefield Wilko/Tesco - Singer Vielle Sales

17 years to Wilko on assignment from Tesco

121 Kirkgate | Wakefield   | WF1 1JG

£2,075,000

offers in the region of

SOLD

Summary

  • Highly prominent retail property with extensive frontage

  • Let to Wilko, on assignment from Tesco Stores Limited, for approx. 17 years

  • Original lease granted in 1970 before changes to the Privity of Contract rules

  • Highly secure income

  • Designated city centre car park within freehold

  • Freehold interest comprising 1.267 acres

  • Offers in the region of £2,075,000 subject to contract

  • 7.0% net initial yield

Location

Wakefield is a West Yorkshire city situated on the eastern side of the Pennines approximately 6.5 km (4 miles) south east of Leeds, 67 km (42 miles) north east of Manchester and 43 km (27 miles) north of Sheffield.

The city benefits from first class communications being situated approximately 4 km (2.5 miles) east of the M1 Motorway from Junction 39 to 41. The motorway provides direct access to Leeds and the A1(M) which links Wakefield to both the north and south of the country. The M62 Motorway is 6.5 km (4 miles) to the north of Wakefield providing access to Hull in the east and Manchester in the west.

Wakefield Westgate and Wakefield Kirkgate both connect the city by rail to the rest of the country. Journey times to London Kings Cross are approximately 2 hours from Westgate and Kirkgate provides regular direct services to the other main regional centres including Bradford, Doncaster, Huddersfield, Leeds, Nottingham and Sheffield.

Leeds Bradford Airport is located 38.5 km (24 miles) north west of the city and provides scheduled domestic and international flights to various UK and European destinations.

Situation

The property is situated in a highly prominent position within the city centre fronting a busy roundabout with extensive frontage to Kirkgate (A61). The property is located almost equidistant between Trinity Walk Shopping Centre to the north and Westfield Kirkgate Train Station to the south. The Ridings Shopping Centre is within 200 metres of the property to the west and Westfield Westgate Train Station is just further beyond The Ridings.

The prime retail core in Wakefield is on the pedestrianised Kirkgate around the entrance to the Ridings Shopping Centre. The Ridings comprises 30,658 sq m (330,000 sq ft) of retail space and is let to anchor retailers Boots, M&S, Morrisons, Primark and TK Maxx. The scheme also provides over 1,000 car parking spaces, some of which are accessible 24 hours. The scheme was acquired by New River Retail Plc at the end of 2015 who are due to undertake an extensive refurbishment in order to attract new retailers and create jobs for the local economy.

Wakefield’s second shopping centre is Trinity Walk which was completed in 2011 and provides 43,757 sq m (471,000 sq ft) of retail space and is anchored by Debenhams and Sainsbury’s. Other occupiers include Argos, H&M, JD Sports, Next, River Island and Topman/Topshop.

The Merchant Gate regeneration scheme is a 17-acre mixed use development project situated approximately 500 metres from The Ridings Shopping Centre with over £70 million invested already. Wakefield One is the new headquarters for the Local Authority and also includes a museum, a library, a business lounge as well as a designated area where business can seek advice on expansion, start-ups and planning. Merchant Gate has also delivered 66 modern one and two bedroom apartments situated around a public space with 100% of apartments sold. In addition, the scheme incorporates 3,499 sq m (37,670 sq ft) of Grade A office accommodation and 2,879 sq m (31,000 sq ft) of retail and leisure space. The scheme incorporates Burbage Square which is a landscaped open public space providing an attractive living and working environment. Merchant Gate is adjacent to Wakefield Westgate Station which has undergone an £8m reconstruction and operating high speed connections for its 2 million annual passengers. Future phases of Merchant Gate are planned. For further information visit www.merchantgate.co.uk.

The City Council is also spearheading redevelopment proposals to transform the road layout and walkways in and around the Kirkgate area of the city. We understand whilst no part of the subject property is affected by any road improvement or widening scheme the Council is planning to install new signals at the roundabout immediately in front of the property. It also aims to improve pedestrian and cycle flow providing better access between the retail core and Wakefield Kirkgate. For more information visit www.wakefield.gov.uk.

Description

Originally a Tesco supermarket and now occupied by Wilko on assignment, the property comprises a large purpose built retail unit. The property is laid over ground and first floor and included within the freehold is a designated car park at the rear accessed via Sun Lane and by a covered pedestrian walkway from Kirkgate.

The Wilko’s provides a large open plan sales area on ground floor and has been fitted out by the tenant in their current corporate image. The store benefits from entrances from Kirkgate and from the designated rear car park. Loading and unloading is via a dock leveller at the side of the property where there are two 2000 kg goods lifts. The first floor is used for ancillary and storage accommodation.

Accommodation

The property has been measured by BKR Floor Plans and provides the following accommodation;

    Net Frontage  Gross Frontage
    60.27 m 61.34 m
    197’9”  201’3”
    Sq M  Sq Ft
Ground Floor Zone A 350.89 3,777
  Zone B 411.56 4,430
  Zone C 403.76 4.346
  Zone D  373.19  4,017
  Remainder 536.14  5,771
  Total 1,166.21 22,341
  ITZA    7,941
First Floor   964.15 10,378
Total   3,043.50 32,760


A set of floor plans is available to download and the measured survey report is available for assignment to a purchaser.

Rateable Value

Accommodation Description Rateable Value
121 Kirkgate  Shop & Premises  £150,000


The Uniform Business Rate is 48 pence per pound for 2015/2016

Site

We estimate the site area to be approximately 0.512 hectares (1.267 acres).

Tenure

Freehold. 

Tenancy

The property is let to Wilko Retail Limited, on assignment from Tesco Stores Limited, on a Full Repairing and Insuring lease for term of 63 years from 20th July 1970 expiring on 20th July 2033, therefore having approximately 17 years unexpired lease term with no breaks. The lease benefits from 14 yearly open market upwards only rent reviews; the July 2012 rent review is outstanding.

The current passing rent is £154,600 per annum which equates to £19.47 Zone A and £4.73 per sq ft overall.

The lease was originally granted in July 1970 to Tesco Stores Limited before changes to the Privity of Contratc rules. The lease was assigned to Wilkinsons Hardware Stores Limited on 28th September 1992.

Covenants

The property is well secured to Wilko Retail Limited (Co. No. 0365335) which has reported the following figures;

  30th January 2016  30th January 2015
Turnover £1,464,475,000 £1,444,563,000
Pre-Tax Profit  £ 25,995,000  £ 22,479,000
Shareholders’ Funds £ 182,398,000  £ 150,093,000


Wilko is a family owned private limited company which has been trading for over 85 years. Established from a single shop in Leicester in 1930 today the company trades from more than 400 stores throughout the United Kingdom. In 2013 the company changed its name from Wilkinson to Wilko and according to its website 6 out of 10 shoppers in the United Kingdom shop with Wilko. The company intends to open a further 100 stores over the next 5 years, both on the high street and out-of-town. For further information visit www.wilko.com.

The lease to Wilko’s pre-dates Privity of Contract and the original tenant, Tesco Stores Limited (Co. No. 519500), has reported the following figures;

  28th February 2015  22nd February 2014
Turnover  £42,278 million  £42,547 million
Underlying Pre-Tax Profit £ 185 million £ 1,595 million
Total Shareholder’s Funds £ 21 million £ 3,169 million

Value Added Tax

The property has been registered for VAT. It is anticipated that the sale will be treated as a Transfer of a Going Concern (TOGC).

Proposal

We are instructed to seek offers in the region of £2,075,000 (Two Million and Seventy Five Thousand Pounds), subject to contract, reflecting a net initial yield of 7.0%, assuming standard purchaser’s costs of 6.29%.

Investment Considerations

  1. An opportunity to acquire highly prominent retail property with extensive frontage;

  2. Let to the highly secure covenant of Wilko Retail Limited having approximately 17 years unexpired with no breaks;

  3. The lease pre-dates changes to Privity of Contract rules – original tenant Tesco Stores Limited;

  4. The property benefits from its own designated city centre car park as part of the freehold interest;

  5. Freehold interest comprising 1.267 acres;

  6. The property occupies a prominent trading position within easy walking distance of the two main shopping centres in the city and the two train stations serving Wakefield

  7. A purchase at the asking price will provide an investor with an attractive net initial yield;

Contact Us

Singer Vielle   +44 (0) 207 935 7200
Neil Singer neil@singervielle.co.uk +44 (0) 203 478 9120
Dale Henry dale@singervielle.co.uk +44 (0) 203 701 1356
Richard Wolfryd richard@singervielle.co.uk +44 (0) 203 701 1353
Faye Langoulant faye@singervielle.co.uk +44 (0) 203 478 9122
Louanne Malan louanne@singervielle.co.uk +44 (0) 203 701 1386

Vendor's Solicitor

Nabarro LLP  
Amy Smith ab.smith@nabarro.com +44 (0)114 279 4069
customer service