stop well-secured-freehold-town-centre-retail-investment-rugby - Singer Vielle Sales

Well Secured Freehold Town Centre Retail Investment

36A High Street | Rugby | Warwickshire  | CV21 3BW

£450,000

subject to contract

SOLD

Summary

  • To be sold by clicktopurchase® online AI auction - 16th May, 11:00am

  • Freehold Shop Investment

  • Prominent town centre retailing pitch

  • Let to Holland & Barrett Retail Limited

  • Highly Secure Income – Pre-Tax Profits £113m

  • Re-based rent

  • Trading from this property since 1999

  • Guide price £450,000, subject to contract

  • 6.4% net initial yield

Location

Rugby is a market town in Warwickshire and second largest town in England. Rugby is located between Coventry, Leicester and Northampton at the crossroads of the motorway network where the M1, M6, M69, A5 and A14 join making it a first class location for distribution.

The town is connected to the national railway network with a fastest journey time to London Euston of approximately 47 minutes.

It has been announced that online retailer Amazon is to open a fulfilment warehouse in Rugby creating 400 jobs. The company has several existing operations in the Midlands already.

Rugby was ranked 20th in the best places to live in the United Kingdom in Halifax’s annual Quality of Life Survey 2017 ahead of towns including Harrogate, Chelmsford, Chichester and Kensington & Chelsea in London. The survey takes account of residents’ health and life expectancy, wellbeing, earnings, employment, crime rates and weather.

Situation

The property is situated on the High Street in the heart of the pedestrianised town centre in close proximity to Market Place. Nearby occupiers include Costa Coffee, Monsoon, The Edinburgh Woollen Mill, McDonald’s and Pizza Express.

Description

The property comprises a retail unit arranged over ground and first floor. Internally, the retail floor area is predominately open plan with ancillary areas and has been fitted out by the tenant to their usual corporate style.

The first floor provides ancillary accommodation.

Accommodation

The property has been measured by BKR Floor Plans and provides the following Net Internal floor areas:

Gross Frontage 7.54 metres 24’9”
Net Frontage 7.01 metres 23’0”
     
Zone A 41.99 sq m 452 sq ft
Zone B 37.25 sq m 401 sq ft
ITZA   653
First Floor 75.99 sq m 818 sq ft
Total 155.24 sq m 1,671sq ft

A set of floor plans is available to download and the measured survey report can be re-addressed to a purchaser.

Tenure

Freehold

Tenancy

The property is let to Holland & Barrett Retail Limited, on a full repairing and insuring lease for a term of 10 years from 9th May 2011, expiring on 8th May 2021. The current passing rent is £30,000 per annum. Based on our analysis the passing rent equates to £46.00 Zone A.

In accordance with a Deed dated 26th October 2015 the rent was reduced from £36,000 per annum and the tenant’s break option dated 9th May 2016 removed from the lease.

The tenant has been trading from this property since 1999.

Covenant

Holland & Barrett Retail Limited (Co. No. 02758955) has reported the following figures:

  30th September 2016 30th September 2015
Turnover £444,127,000 £414,662,000
Pre-Tax Profits £112,823,000 £128,151,000
Shareholders’ Funds £252,227,000 £320,487,000


Britain’s largest health and wellness retail operator, Holland & Barrett was acquired by L1 Retail in a £1.8 billion transaction in June 2017. The company is headquartered in Warwickshire and employs approximately 7,000 people across its headquarters and its retail portfolio of over 1,000 retail shops. For more information visit www.hollandandbarrett.com.

Market Commentary

Parties are invited to refer to the following recent investment transactions;

Address Tenant

Unexpired Lease Term

Tenure Price  Achieved Date Sold
41 London    Road,   
East
Grinstead
Carphone Warehouse 3.4 Years

999
year lease

£335,000 
6.0% NIY
Jan-18
43 London  Road,  
East
Grinstead
EE 4 Years 999
year lease
£335,000
6.0% NIY
Jan-18

 

VAT

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

Guide price £450,000 (Four Hundred and Fifty Thousand Pounds), subject to contract, reflecting a net initial yield of 6.4%, assuming purchasers’ costs of 4.17%.

Investment Considerations

  1. An opportunity to acquire a freehold town centre retail investment;

  2. The property occupies a prominent retailing pitch;

  3. Let to the highly secure covenant of Holland & Barrett Retail Limited (Shareholders’ Funds £252,227 million);

  4. The rent has been re-based;

  5. Holland & Barrett has been trading from this property since 1999;

  6. Attractive lot size to an investor;

  7. A purchase at the asking price reflects 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
Faye Langoulant faye@singervielle.co.uk +44 (0) 203 478 9122
Louanne Malan louanne@singervielle.co.uk +44 (0) 203 701 1386

Vendors Solicitor

Gandecha & Pau Solicitors 020 8905 0900
Prakash Gandecha p.gandecha@gaplaw.com
Sunil Vaghji s.vaghji@gaplaw.com
customer service