stop Well Secured South East Office Investment - Singer Vielle Sales

Well Secured South East Office Investment

Chancery Court | Lincoln Road | High Wycombe | HP12 3RE

£1,900,000

offers in the region of

SOLD

Summary

  • South East office investment

  • Highly secure income

  • Tenant - Linden Homes (Pre-Tax Profits £94.5m)

  • Guarantor - Galliford Try PLC (Pre-Tax Profits £114m)

  • Approximately 5.5 years unexpired lease term

  • Established commercial location

  • 11.17% net initial yield

  • 12.21% reversionary yield in Nov 2016

Location

High Wycombe is situated approximately 48 km (30 miles) north west of Central London, 43 km (27 miles) south east of Oxford and 16 km (10 miles) north of Maidenhead. The town benefits from good road communications being situated approximately 3 km (1.8 miles) north west of Junction 4 of the M40 Motorway and 15 km (9 miles) west of the M25 Motorway.

In addition, the town is connected to the national railway network with a fastest journey time to London Marylebone Station of 30 minutes. Heathrow Airport is approximately 32 km (20 miles) to the south east and Luton Airport some 60 km (37 miles) to the north east.

Situation

The subject property is accessed via Lincoln Road and is strategically located 1.6 km (1 mile) north of Junction 4 of the M40 Motorway. High Wycombe town centre and rail station are approximately 3.2 km (2 miles) to the north east.

The property is located in Lincolns Inn, an established business village forming part of the surrounding Cressex Business Park which houses a combination of office and light industrial uses. Nearby office developments include the Lincolns Inn Office Village immediately to the rear and the Anglo Office Park.

Description

The subject property comprises a detached office building constructed in the 1980’s arranged over ground and first floors with brick elevations under a pitched roof.

Surface car parking for 28 vehicles is provided to the front of the property with a further three spaces to the side and one space to the rear.

The specification includes:

  • Suspended ceilings

  • Double glazing

  • Wall mounted convector heaters

  • Some suites benefit from air-cooling provided from individual wall and

  • ceiling mounted cassettes which we understand are tenant’s improvements

  • Male, female & disabled WC’s

  • 8-person passenger lift

The property is currently used as a serviced office centre known as Chancery Court Business Centre.

See chancerycourtbusiness.co.uk.

Accommodation

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

Ground Floor Offices 626.98 sq m 6,749 sq ft
First Floor Offices 613.05 sq m 6,599 sq ft
Total   1,240.03 sq m 13,348 sq ft


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

Note that the property has been measured in accordance with the new International Property Measurement Standard (IPMS).

Tenure

Long Leasehold from Wycombe District Council for a term of 125 years from 18th May 1990, expiring 17th May 2115 (99 years unexpired) at a current ground rent of £24,000 per annum. The lease is subject to 5 yearly upward only rent reviews to 12.5% of the full rack rental value of the property. The 17th May 2015 rent review is currently outstanding.

The permitted uses according to the Headlease are as a serviced office centre, research & development, industrial or offices (other than for: (i) financial services, (ii) professional services or (iii) any other services (including use as a betting office) which it is appropriate to provide in a shopping area). A copy of the Headlease is available to download in the data room.

Tenancy

The property is let to Linden Limited, guaranteed by Galliford Try plc on a Full Repairing and Insuring lease for a term of 15 years from and including 28th November 2006, expiring on 27th November 2021.

The current passing rent is £225,600 per annum (£181.93 per sq m / £16.90 per sq ft overall), payable quarterly in advance, and is reviewed 5 yearly to the higher of the Open Market Value and the Retail Price Index (uncapped). The next rent review is due on 28th November 2016 and based on the most recent December 2015 RPI figure the rent would increase to £246,505 per annum.

The tenant also pays an Additional Rent of £24,000 per annum which is not subject to review, payable every six months in advance.

Therefore, the total passing rent is £249,600 per annum.

The total current net income receivable after deducting the head rent is£225,600 per annum.

A section of the car park at the rear of the property has been underlet for a term of 125 years (less 3 days) from 18th May 1990 at a peppercorn rent.

Covenant

Tenant - Linden Limited (Co. No. 01108676) has reported the following figures:

  30th June 2015 30th June 2014
Turnover £786,506,000 £711,756,000
Pre-Tax Profits £94,500,000 £69,955,000
Net Assets £143,712,000 £121,190,000


Linden Homes is a top 10 housebuilder offering a distinctive and diverse product range of new homes and properties in prime locations throughout the United Kingdom. The ultimate parent undertaking and controlling party is Galliford Try Plc.

Guarantor - Galliford Try Plc (Co. No. 00836539) has reported the following figures:

  30th June 2015 30th June 2014
Group Revenue £2,348.4 million £1,767.8 million
Pre-Tax Profits £114 million £95.2 million
Net Assets £569.2 million £534.2 million


The above are record results for the company, with Revenues rising by 33% and Profits rising by 20%.

Value Added Tax

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

Proposal

Offers in the region of £1,900,000 (One Million, Nine Hundred Thousand Pounds), subject to contract, reflecting a net initial yield of 11.17% (assuming purchasers' costs of 6.25%) and a reversionary yield of 12.21% based upon the December 2015 All Items Retail Price Index. 

Investment Considerations

  1. An opportunity to acquire a South East office investment;

  2. The investment provides highly secure income – let to Linden Homes (£94.5m Pre-Tax Profits), with a guarantee from Galliford Try PLC, a FTSE 250 company with Net Assets of £570 million;

  3. Approximately 5.5 years unexpired lease term;

  4. The property is in an established commercial location;

  5. The property is being operated as a successful serviced office centre with a high occupancy rate;

  6. A purchase at the asking price reflects an attractive yield profile

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
Graham Waddell graham@singervielle.co.uk +44 (0) 141 221 4545
Faye Langoulant faye@singervielle.co.uk +44 (0) 203 478 9122
Louanne Malan louanne@singervielle.co.uk +44 (0) 203 701 1386

 

Vendors Solicitor

McCorry Connolly  
Louise Ball louise@mclawyers.co.uk +44 (0)1708 727 269

 

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