London Retail and Residential Investment Opportunity

788 Green Lane | Goodmayes | RM8 1LA

£400,000

subject to contract

EXCHANGED

Summary

  • To be sold by clicktopurchase® online auction – 14th December, 1.00pm

  • London investment opportunity

  • New letting agreed for the retail accommodation

  • FreeholdApportioned residential investment price underpinned by vacant possession value

  • Guide price £400,000, subject to contract

  • Net Initial Yield 6.4%

  • Implied attractive yield of 9.0% in respect of the retail accommodation

788 Green Lane | |  |  | Goodmayes | | RM8 1LA

Location

Goodmayes is located within The London Borough of Barking and Dagenham and situated approximately 18 km (11 miles) east of Central London, 11 km (7 miles) east of Canary Wharf, 8 km (5 miles) east of Stratford, 5 km (3 miles) south of Romford and 15 km (9 miles) north east of the Dartford Crossing.

The area benefits from good road communications being located 16 km (10 miles) north west of Junction 31 of the M25 Motorway and 15 km (2 miles) east of the North Circular Road. The intersection of the M25 Motorway and the M11 Motorway is approximately 16 km (10 miles) to the north, the A2/M25 intersection is some 25 km (16 miles) to the south-east, leading to the M2, and, the M20/M25 intersection is approximately 28 km (17 miles) to the south. The town is also served by the Thames Gateway (A13) which provides direct access east to the M25 and to the North Circular Road, Canary Wharf and Central London to the west.

Goodmayes benefits from being connected to the national railway network, providing a journey time to London Liverpool Street of approximately 23 minutes.

London City Airport is located approximately 11 km (7 miles) to the south. London Stansted Airport is located approximately 39 km (24 miles) to the north and London Southend Airport some 45 km (28 miles) to the east.

The London Borough of Barking and Dagenham is estimated to have a population of 210,711, of which 63% are of working age, between the ages of 16 and 64 years.
(Source: London Borough of Barking and Dagenham Council).

Situation

The subject property occupies a prominent position on Green Lane, an established retail parade in the Goodmayes area, approximately 3 km (2 miles) north of the centre of Dagenham. Goodmayes Railway Station is 1.3 km (0.8 miles) to the west and Chadwell Heath Railway Station is 1 km (0.6 miles) to the north. The closest London Underground Station is Becontree Station, situated approximately 2.9 km (1.8 miles) to the south.

Green Lane is an established local retail parade with a mix of national, multiple and local occupiers. Nearby occupiers include Tesco Express, Co-operative Funeralcare, Greggs, Lloyds Pharmacy, Paddy Power and Coral.

788 Green Lane | |  |  | Goodmayes | | RM8 1LA
788 Green Lane | |  |  | Goodmayes | | RM8 1LA

Description

The property comprises a 2-storey mid-terraced mixed-use building currently arranged over ground and first floor levels.

The ground floor retail unit is currently vacant although terms have been agreed to let to a new occupier.

The first floor currently comprises a self-contained 2-bedroom flat, let on an Assured Shorthold Tenancy Agreement.

Accommodation

The ground floor accommodation has been measured by Plowman Craven & Associates. The report is available to download.

  Sq m Sq ft
Gross Frontage 5.79 19
Ground Floor (NIA):    
Zone A 32.8 353
Zone B 25.6 276
Zone C 17.0 183
Zone D 2.0 22
ITZA 50.1 539
Total sales 77.4 833
     
Ancillary 19 205
Total Net Internal Area 96.4 1,038
     
Total Gross Internal Area 104.0 1,119

The first and second floor residential accommodation has not been inspected. However, we have provided within the data room a management inspection report from March 2018. We have been advised that the property extends to 942 sq ft but note that this has not been verified.

788 Green Lane | |  |  | Goodmayes | | RM8 1LA
788 Green Lane | |  |  | Goodmayes | | RM8 1LA

Tenure

Freehold.

Tenancy

The ground floor retail unit is under offer to Knowledge County College Limited on a new lease for a term of 10 years with an option to determine in year 5. The agreed initial rent is £18,000 per annum. The lease incorporates a 4 month rent free period and the tenant is to provide a 3 month security deposit. The agreed rent equates to £32.50 Zone A. Overall, the proposed rent equates to £186 per sq m / £17.32 per sq ft.

The first floor residential accommodation is let to a private individual by way of an Assured Shorthold Tenancy Agreement at a current rent of £8,760 per annum.

Hence, the total income will be £26,760 per annum should the agreed letting complete.

788 Green Lane | |  |  | Goodmayes | | RM8 1LA
788 Green Lane | |  |  | Goodmayes | | RM8 1LA

Covenant

Knowledge County College Limited (Co. No 08216316):

  2017 2018
Shareholder’s Funds £29,533 £13,504

The tenant is described on their website as “an independent College of further and higher education”. Click here.

VAT

The property has not been VAT elected, therefore the purchase will not be subject to VAT

788 Green Lane | |  |  | Goodmayes | | RM8 1LA
788 Green Lane | |  |  | Goodmayes | | RM8 1LA

Proposal

Guide price £400,000 (Four Hundred Thousand Pounds), subject to contract, representing a net initial yield of 6.4% (purchase costs at 4.18%).

Allocating an investment yield of 9% to the retail accommodation equates to a value of approximately £200,000 in relation to the upper parts which we suggest from our enquiries represents the vacant possession value for the residential accommodation.

Please note that a purchaser will be re-charged the costs of surveys and searches which are provided in the data room.

Please note a purchaser will be charged a transaction fee of £2,000 + VAT.

Investment Considerations

  1. An opportunity to acquire a freehold investment and residential investment opportunity in London.

  2. Attractive net initial yield (on completion of the proposed letting);

  3. Attractive lot size to an investor;

  4. A purchase at the asking price reflects a capital value on the upper areas underpinned by vacant possession values.

788 Green Lane | |  |  | Goodmayes | | RM8 1LA

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
Faye Langoulant faye@singervielle.co.uk +44 (0) 203 478 9122
Louanne Malan louanne@singervielle.co.uk +44 (0) 203 701 1386

Vendors Solicitor

Addleshaw Goddard  
Paul Barnard paul.barnard@addleshawgoddard.com +44 (0) 161 934 6557
Rhiannon Brown rhiannon.brown@addleshawgoddard.com +44 (0) 161 934 6490
customer service