High Yielding Prime Town Centre Investment
57/57a Greengate Street | Stafford | ST16 2JE
subject to contract
Freehold retail investment opportunity
Let to Waterstone’s Booksellers Limited
Rebased rent to £57,400 from £82,500 per annum
Prime position on pedestrianised Greengate Street
Over 9.5 years unexpired lease term
£682,500 subject to contract
8.0% Net Initial Yield
Potential for residential conversion of upper floors (subject to consents)
Stafford is a busy historic market town, which first made a name for itself as a centre for shoe manufacturing expanding as an industrial hub in the nineteenth century. Stafford boasts a resident population of 64,000 and a district population of 120,000.
The town is situated in the county of Staffordshire, approximately 25 miles (40 km) to the north of Birmingham and 15 miles (24 km) to the south of Stoke-on-Trent.
Stafford benefits from good transport links, with Junctions 13 and 14 of the M6 Motorway approximately 3 miles (5 km) to the north and south of the town respectively. The property is a short 5 minute walk from rail services available at Stafford Railway Station offering frequent high speed trains to Birmingham New Street in approximately 33 minutes and London Euston in just over 1 hour and 15 minutes. The nearest airports are Birmingham Airport 40 miles (64 km) to the south and Manchester Airport 51 miles (82 km) to the north.
The Stafford retail market is focused on the pedestrianised streets of Gaolgate Street and Greengate Street, along with Gaolgate Place and the covered Guildhall Shopping Centre. The property is situated in an excellent trading location on the long western side of Greengate Street with the Guildhall Shopping Centre entrance only a short walk from the property.
Occupiers close by include HSBC, Clinton Cards, WHSmith and Greggs. Other nearby national retailers include Boots, Thorntons, Starbucks, Pandora, Thomson and Thomas Cook.
The property is a three-storey period building on the western side of Greengate Street, close to Market Square. The building is Grade II Listed. The premises are arranged over basement, ground, first and second floors.
The ground floor comprises of retail space to the front of the property, with a raised area to the rear used as a kitchen and staff room. The first and second floors were formerly used as office space.
The premises benefit from separate access to the upper floors via an entrance onto Greengate Street.
The entire property is let to Waterstone’s. The upper floors are currently not utilised. Since these floors have a separate entrance, it is suggested that there is potential for future redevelopment / conversion to residential accommodation.
The property has been measured by BKR Floor Plans and provides the following Net Internal Areas:
|Gross Frontage||7.95 m||26ft 1 inch|
|Net Frontage||6.32 m||20ft 9 inches|
|Sq M||Sq Ft|
|Total Ground Floor||200.85||2,162|
|First Floor Ancillary||149.66||1,611|
|Second Floor Ancillary||93.55||1,007|
|Total Net Internal Area||668.88||7,200|
A set of floor plans is available to download and the measured survey report will be assigned to a purchaser at a cost of £495 + VAT.
The entire property is let on full repairing and insuring terms to Waterstone’s Booksellers Limited for a term of 10 years from 14th September 2018, expiring 13th September 2028.
The current passing rent is £57,400 per annum, equating to £47.50 Zone A. This is based upon £4.00 per sq ft on the rear ancillary, £2.00 per sq ft on the basement, £3.00 per sq ft on the first floor and £2.00 per sq ft on the second floor.
Waterstone’s have recently renewed their lease. The previous rent was £82,500 per annum. The tenants have an option to break the lease in the 5th year, subject to 6 months’ notice.
Waterstone’s Booksellers Limited (Co No. 00610095) is a long established British book retailer employing over 3,000 people over 280 bookshops. The company has reported the following accounts:
|28 April 2018||29 April 2017|
Waterstone’s have recently underlined their expansion drive under new owners, Hedge Fund Elliot Advisers, with a view to opening a significant number of shops over the next few years. Confidence in the retailers is supported and strengthened by the purchase of 115-year-old Foyles Books in September 2018. For further information see www.waterstones.com.
The property is elected for VAT. We anticipate that the sale should be capable of being treated as a Transfer of Going Concern (TOGC).
Upper Floors Potential
Although they are demised to Waterstones the tenant does not use the upper floors. We assess the passing rent attributable to the upper floors at approximately £7,000 per annum. Based upon the asking yield of 8.0%, this allocates a purchase price to this area of the property at only £87,500.
Subject to consents, it is suggested that the upper floors could potentially provide four residential units with an exit value in the region of £4/500,000 after refurbishment, providing an opportunity to enhance value.
We are instructed to seek offers in the region of £682,500 (Six Hundred and Eighty Two Thousand, Five Hundred Pounds), subject to contract, reflecting a net initial yield of 8.0%, assuming standard purchaser’s costs of 5.26%.
Please note that a purchaser will be re-charged the costs of searches and surveys which are provided in the data room.
Please note that a purchaser will be charged a Transaction Fee of £3,750 plus VAT.
An opportunity to acquire a freehold prime retail investment in the heart of Stafford town centre;
The property occupies a prime position near the Guildhall Shopping Centre;
Let to the strong covenant of Waterstone’s Booksellers Limited;
A purchase at the asking price will provide an investor with an attractive net initial yield of 8.0%;
Potential redevelopment / conversion of the upper floors to provide residential accommodation.
|Knights Plc||+44 (0) 116 242 1258|