Prime Single Let Retail Warehouse

Prime Single Let Retail Warehouse
HUGHES ELECTRICAL, GROVE STREET, REDDITCH, B98 8DX
INVESTMENT SUMMARY
n Prominent location in Redditch town centre.
n Modern detached retail warehouse unit with unrestricted Open A1 consent.
n Over 5 years unexpired to Hughes Electrical Ltd.
n Low passing rent of £11 per sq.ft.
n Offers sought in excess of £1,700,000.
n Net initial yield 7.75%, assuming purchaser’s costs of 5.80%.
LOCATION
Redditch is a major town located approximately fourteen miles south of
Birmingham city centre. Bromsgrove lies six miles to the west and Solihull
thirteen miles to the northeast.
The town lies approximately four miles south of Junctions 2 and 3 of
the M42 motorway via the A441 and the A435, which links into the M5
and M6 forming the orbital motorway network around Birmingham.
The M40 links to the M42 at Junction 3a, 5 miles to the north east,
providing access to the south east and London. There are frequent
rail services to Birmingham New Street with a fastest journey time of
approximately 35 minutes.
The total population within the Redditch primary catchment is 181,000
and rises to 960,000 within 12 miles of its centre.
RETAIL WAREHOUSING IN REDDITCH
Retail warehouse supply for Redditch is estimated at
378,000 sq.ft with the principal concentration of out
of town retail accommodation in close proximity to the
subject property.
The Trafford Centre is situated to the south of the
subject property and provides a 61,000 sq.ft retail park
let to Aldi, Home Bargains, Iceland, Pets at Home,
Poundstretcher, Maplin and KFC. Also to the south east
is a retail warehouse occupied by Halfords.
To the east of the property are units occupied by Staples,
Lidl and Wickes.
Other retail warehouse occupiers in close proximity of
the town centre include B&Q, Matalan, Homebase and
Argos.
SITUATION
The property is located in a highly prominent position on Redditch Ringway, which is the ring
road around the town centre providing access to the Kingfisher Shopping Centre and the A441.
Redditch Town Hall is immediate to the rear of the property and to the north is the Palace
Theatre and Shipley Bingo Hall. The Kingfisher Shopping centre is a short walk to the west of
the property.
DESCRIPTION
The property comprises a modern detached retail warehouse of steel
portal frame construction with part brick and profile clad elevations and
a profile clad roof.
Internally the unit provides a large open plan retail area with rear
storage. There is additional storage at first and second floor levels with
an elevator linking the ground and first floors.
Externally there is a 50 space car park to the front of the unit and a
loading yard to the side of the unit providing access to the rear stores.
SITE AREA
The site area is 0.38 hectares (0.95 acres) with a site density of 24%.
ACCOMMODATION
The property has been measured in accordance with the RICS Code of
Measuring Practice and extends to the following Gross Internal Area:
AREA sq.m.
AREA sq.ft.
Ground Floor
939.2510,110
First Floor
414.794,465
Second Floor
Total
71.81773
1,425.8515,348
PLANNING
The property benefits from an unrestricted Open A1 planning consent.
A copy of the planning consent is available on request.
TENURE
The property is held freehold.
TENANCY
The property is let to Hughes Electrical Limited (trading as Apollo 2000) on full
repairing and insuring terms for a term of 10 years from 10 November 2009,
expiring 9 November 2019. The current rent is £140,000 per annum (£11.00
per sq.ft).
The lease is subject to five yearly upward only rent reviews with the next review
due on 10 November 2014.
COVENANT
Hughes Electrical was founded in 1921 and is currently the 4th largest specialist
electrical retailer and the 2nd largest provider of home entertainment and
kitchen appliance rentals in the UK. The company acquired Apollo 2000 in
2009 and Bennetts Electrical in 2011. Across the three brands the company
have 41 stores in the UK.
A summary of the tenant’s accounts is set out below:
Hughes Electrical Ltd
(co no 00406069)
31/03/201331/03/201231/03/2011
£,000s £,000s£,000s.
Turnover
102,927100,780 82,052
Pre-tax Profit
Shareholders’ Funds
3,0323,8533,743
22,34422,55222,787
RENTAL COMMENTARY
The current rent of £140,000 per annum reflects a low rent of £11.00 per sq.ft.
Set out below are a number of rental comparables in the immediate area:
Address
Tenant
Floor Area
sq.ft
Lease
Terms
Planning
Rent £per
sq.ft
Ringway Retail Park, Former Currys
Redditch
Unit
9,642
Available
A1 non food
£15.00
Trafford Retail Park,
Redditch
6,125
10 year lease
from Jan 2013
A1 non food
£18.50
(Net £15.73)
Ringway Retail Park, Wickes
Redditch
27,638
15 year lease
from Oct 2012
Bulky goods
£15.50
Trafford Retail Park,
Redditch
Home
Bargains
7,500
15 year lease
from April
2011
A1 non food
£17.50
(Net £15.50)
Trafford Retail Park,
Redditch
Aldi
16,286
20 year lease
from Mar
2009
A1 food
£18.00
(Net £17.40)
Maplin
VAT
The property is elected for VAT and therefore VAT will be payable on the purchase price. It is
anticipated that the sale will be dealt with as a TOGC.
For further information or if you wish to arrange a viewing,
please contact :BEN BLACKWALL
0121 513 0893
ben.blackwall@fspproperty.co.uk
ANDREW PRICE
0121 513 0892
andrew.price@fspproperty.co.uk
PROPOSAL
We are instructed to seek offers in excess of £1,700,000 (One Million Seven Hundred Thousand
Pounds) subject to contract and exclusive of VAT.
Franck Steier Price Ltd
Third Floor, Victoria House
114-116 Colmore Row, Birmingham, B3 3BD
A purchase at this level would reflect a net initial yield of 7.75%, assuming usual costs of purchase
of 5.8%.
Misrepresentation Clause : The accuracy of any description, dimensions, references to condition, necessary
permissions for use and occupation and other details contained herein are not guaranteed and are for
general guidance only and prospective purchasers or tenants must not rely on them as statements of fact or
representations and must satisfy themselves of their accuracy. Neither Franck-Steier Price Ltd, nor any of their
employees or representatives has any authority to make or give any representation or warranty or enter into
any contract whatever in relation to the property. Prices and rents quoted in these particulars may be subject
to VAT in addition. The reference to any mechanical or electrical equipment or other facilities at the property
shall not constitute a representation (unless otherwise stated) as to its state or condition or that it is capable of
fulfilling its intended function. Prospective tenants/purchasers should satisfy themselves as to the condition of
such equipment for their requirements.