High Yielding Retail and Residential Investment
9 Mercers Row | Northampton | NN1 2QL
subject to contract
Prominent location in the heart of Northampton town centre
Self-contained upper parts
12 years unexpired to the commercial tenant
7.5 years unexpired (break in 2.5 years) to the residential tenant
£350,000, subject to contract
10.05% NIY overall
Based on a realistic value for the commercial element, the asking price reflects a significant discount of 40% to the VP value for the residential element.
Northampton is located approximately 106 km (66 miles) north west of Central London, 88 km (55 miles) south east of Birmingham, 59 km (37 miles) south of Leicester and 88 km (55 miles) west of Cambridge.
The town benefits from good road communications with Junction 15 of the M1 Motorway approximately 6.4 km (4 miles) to the south, accessed via the A45, Junction 15a some 6.4 km (4 miles) to the south-west and Junction 16 approximately 8 km (5 miles) to the west, accessed via the A4500. The M1/M6 Motorway Interchange is approximately 29 km (18 miles) to the north-west.
In addition, the town is connected to the national railway network with a fastest journey time to London Euston of 49 minutes. Direct rail connections are also provided to other regional centres including Birmingham, Nottingham and Milton Keynes.
London Luton Airport is approximately 61 km (38 miles) to the south-east and Birmingham International Airport is approximately 72 km (45 miles) to the north-west.
Northampton is located at the heart of the UK, with unrivalled national and international transport links. The town has been identified by Government as a key area for economic growth and was singled out in an Experian report as the best place in the UK to do business, the only place in the country to score 19 out of a possible 20 points across four critera: Number of start-ups, rate of insolvencies, level of financial health and business turnover. Northampton has also been rated in the UK’s top ten places to work based on factors including average house price, wage and available jobs. (Source: www.northamptonez.co.uk).
The property occupies a prominent position in the town centre on Mercers Row with a return frontage onto Conduit Lane, on the north east corner of the Market Square and opposite the All Saints Church.
Other businesses nearby include Greggs, Nandos, Prezzo, Rolex, McDonalds, Snappy Snaps, Starbucks, Burger King and Boots.
Mercers Row leads directly onto Abington Street which is the town’s principal retailing pitch. Businesses on Abington Street include, Tesco Express, JD Sports, Moss Bros, EE, Metro Bank, Holland & Barrett and Costa Coffee,
The Grosvenor Centre totals approximately 29,729 sq m (320,000 sq ft) and is the town’s main shopping centre, benefiting from over 60 shops and eateries plus over 800 car parking spaces. The Centre underwent a significant refurbishment programme throughout 2015 to provide a more modern and stylish shopping environment. The scheme is anchored by Primark, Next and Boots with other notable brands including Topshop, Superdry, Apple iStore, Lush, Pandora amongst others. The centre’s principal entrance is approximately 150 yards from the property.
The property comprises a three-storey end of terrace retail and residential building with a return frontage.
The ground and basement comprise of the retail element and have been fitted out by the tenant to provide a high-quality hairdresser with treatment rooms. There are two customer access points, via Mercers Row and Conduit Lane. The unit has extensive full height glazed frontages.
The upper parts comprise of two separate two-bedroom flats, one on the first floor and the other on the second floor.
Each flat has two double bedrooms, a bathroom with WC and a fully fitted open plan kitchen/living room.
The first-floor flat is within the retail tenant’s demise.
The upper floors were formally office accommodation but have been converted to high level residential accommodation and benefit from separate access from Conduit Lane.
The property has been measured by BKR Floor Plans and provides the following Net Internal floor areas for the retail element:
|Net Frontage||4.50 m||14’9”|
|Gross Frontage||5.18 m||17’|
|Zone A||60.57 sq m||309 sq ft|
|Zone B||66.33 sq m||320 sq ft|
|Zone C||7.71 sq m||83 sq ft|
|Ground Floor ITZA||471 units|
|Total Ground Floor||66.14 sq m||712 sq ft|
|Basement||50.91 sq m||548 sq ft|
|Total||117.05 sq m||1,260 sq ft|
|The First and Second Floor (residential element) Gross Internal Areas are:|
|First Floor||59.64 sq m||642 sq ft|
|Second Floor||67.17 sq m||723 sq ft|
|Total Gross Internal Area||282.88 sq m||3,045 sq ft|
A set of floor plans is available to download and the measured survey report will be re-addressed to a purchaser at a cost of £345 + VAT.
The basement, ground (retail) and first floor (residential) are let to Northampton Aksoy Ltd (t/a The Stylers) on a full repairing and insuring lease for a term of 15 years from 8th November 2018, expiring on 7th November 2033. There are no break clauses and the lease benefits from 3 yearly open market rent reviews with the next one being on 7th November 2024. The passing rent is £27,500 per annum.
We analyse the rent attributable to the ground and basement to be £18,500 pa, which equates to a Zone A rate of £39 per sq ft.
The second-floor flat is let to Diamond Life Ltd on a full repairing and insuring lease for a term of 10 year lease from 16th April 2019, expiring 15th April 2029. There is a mutual landlord and tenant break option on 16th April 2024 subject to 6 months’ written notice. The lease benefits from an uncapped RPI rent review on 16th April 2024. The passing rent is £9,000 per annum.
Therefore, the total passing rent for the entire property is £36,500 per annum.
Northampton Aksoy Ltd is currently in arrears, owing £22,852.15 + VAT. Currently, there is no repayment plan in place. Diamond Life Ltd is currently in arrears, owing £5,512.06 + VAT. Currently, there is no repayment plan in place. The arrears have accrued as a result of the pandemic; note that the purchaser is not required to pay for the arrears (please see special conditions of sale)
Northampton Aksoy Ltd t/a The Stylers is a unisex salon providing a wide range of hair and beauty treatments.
For further information please visit - www.facebook.com/TheStylersNorthampton
Diamond Life Ltd is a serviced accommodation business operating throughout England.
For further information please visit - www.diamondlifeltd.co.uk.
The property is not listed and is within the All Saints Conservation Area.
The property has been registered for VAT and it is anticipated that the sale will be treated as a Transfer of a Going Concern (TOGC).
We are instructed to seek a figure of £350,000 (Three Hundred and Fifty Thousand Pounds), subject to contract, reflecting a net initial yield of 10.05%, assuming standard purchaser’s costs of 3.80%.
Alternatively, assessing the apportioned rent for the retail element at £18,500 pa, and applying a yield of 10.05%, the retail value would be £180,000. Hence, the apportioned value on the upper parts is £170,000, reflecting a significant discount to the vacant possession value which we suggest is in the order of £240,000 (£120,000 per flat).
Please note that a purchaser will be re-charged the costs of the measured survey (£345 + VAT)and searches (£852.02), which are provided in the data room.
Please note that a purchaser will be charged a Transaction Fee of 1.0% of the Purchase Price plus VAT.
An opportunity to acquire a mixed-use town centre investment;
The property occupies a prominent position in the heart of Northampton town centre;
12 years unexpired on the commercial element;
7.5 years unexpired on the residential element with the benefit of an uncapped RPI-linked rent review;
A purchase at the asking price reflects an attractive net initial yield;
Attractive lot size to an investor.
Attractive yield and substantial discount to the apportioned residential value
Data Room and clicktopurchase®
Access to the data room and for the ability to purchase online with speed and ease, please click the clicktopurchase® “C” icon or the clicktopurchase® side bar. Purchasers will be able to access the complete legal package, clear verification and submit legally-binding offers to acquire the property.
Purchasers benefit from the trust, security and transparency provided by the platform. All activities, including the online contract execution, will form part of the electronic audit trail which is anchored in the clicktopurchase® Blockchain.
clicktopurchase® provides the opportunity for any investor, whether located UK or abroad, to uniquely purchase online with ease and certainty. To learn more about clicktopurchase®, click here.