2-4a Southgate Street, Gloucester -...
Transcript of 2-4a Southgate Street, Gloucester -...
2-4a Southgate Street, GloucesterPrime & Prominent Corner Retail Unit Located On ‘The Cross’
Property Consultants
Investment Summary
Gloucester is one of the most dominant retail destinations in the South West. Total town centre retail space is estimated at 1.48m sq ft.
The property is located in an extremely prominent
corner position on The Cross. The property is highly visible from the length Of the prime pitch of Eastgate Street, where tenants include Primark, Marks & Spencer, Top Shop, Starbucks, Waterstones and The Body Shop.
The property comprises a four-storey building offering regular sales accommodation at the ground and part basement levels (xxxx).
The property is held freehold. The retail unit is let to Vodafone Ltd on a lease to expire
on 15th May 2022 (TOTB 16th May 2017).
The passing rent is £85,000 p.a. and reflects just £70.50 ZA.
The office upper parts have recently been vacated and offer asset management potential. The landlord will provide a rental guarantee.
We are seeking offers in excess of £1.25 million, which after allowing for standard purchaser’s costs of 5.8% reflects 7.52% NIY.
Location
Gloucester is an historic Cathedral City and the county town of Gloucestershire. The city is considered one of the dominant retail and commercial destinations in the South West. Gloucester is situated on the River Severn and lies close to the Welsh border. The city is 32 miles to the north east of Bristol, 45 miles south west of Birmingham and 104 miles west of London.
Road links are excellent, with Gloucester sitting at the intersection of the A40 and the A438, which provides a direct link to the M5 at Junctions 11, 11A and 12. The M5 motorway provides a continuous motorway link to the M4, M50, M6 and M42, together linking the city to the wider motorway network. By rail, Gloucester benefits from its proximity to the Bristol and Birmingham Railway. There is also a direct link to London Paddington at a fasted journey time of approximately 2 hours.
Finally, Bristol International Airport serves Gloucester by air, being located just 37 miles to the south. This airport offers both domestic and international flights.
Retailing in Gloucester
Gloucester is a major retail destination in the UK and one of the dominant locations in the South West. The central retail area offers approximately 1.48m sq ft of retail floor space, which ranks the city 34th out of the Promis 200 Centres.
Gloucester’s prime retail area is focused around the intersecting pedestrianised streets of Eastgate, Southgate, Westgate and Northgate, which is known as ‘The Cross’. At The Cross, footfall levels are exceptional, with the respective thoroughfares linking to Gloucester’s various shopping pitches and centres, car parks and principal transport hubs.
Retailers situated nearby The Cross include Topshop, Waterstones, Starbucks, EE, Clarks, Sports Direct, Costa and the banks HSBC, RBS and Halifax. Other significant tenants located on Gloucester’s prime high street pitch of Eastgate Street include Marks & Spencer, Primark, BHS and H&M.
Gloucester has two managed schemes, which together account for just 18% of the total floorspace. The Eastgate Shopping Centre totals 250,000 sq ft over two levels. Tenants within the scheme include M&S, H&M and JD Sports. The second scheme is King’s Walk, which totals 400,000 sq ft and is anchored Primark, WH Smith and BHS, all of whom benefit from Eastgate Street frontages, and HMV, Superdrug and Iceland. Both schemes have their entrance on Eastgate Street.
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2-4a Southgate Street, Gloucester
Situation
The property occupies a prime and highly prominent corner position on the Southgate Street and Westgate Street side of The Cross. The property, therefore, is highly visible from the length of the prime section of Eastgate Street.
Other tenants located on The Cross include EE and HSBC, whilst Topshop, Waterstones, Marks & Spencer, Starbucks and Costa are also nearby the subject property.
Description
The property comprises a four storey retail unit offering regular sales accommodation at ground floor level. In addition, retail ancillary accommodation is provided at the basement and mezzanine level. In addition, a staircase at ground floor to the basement level offers the potential to adopt this space as sales in the future.
The upper parts benefit from self-contained access, which is located on the property’s Southgate Street frontage.
The property has been measured in accordance with the RICS Code of Measuring Practice (6th Edition) and has the following approximate net internal areas:
Floor Sq ft Sq m
Ground Sales 1,387 sq ft 128.90 sq m
Ground ITZA 997 UNITS -
Basement Shop Ancillary 884 sq ft 82.14 sq m
Mezzanine Shop Ancillary 248 sq ft 23.08 sq m
First Floor Office 1,119 sq ft 104.00 sq m
Second Floor Office 1,169 sq ft 108.60 sq m
Third Floor (Attic) 157 sq ft 14.62 sq m
Total 4,965 sq ft 461.34 sq m
2-4a Southgate Street, Gloucester
Tenancies
The retail unit is let to Vodafone Ltd on an effective FRI lease for a term of 10 years from 16th May 2012 and expiring 15th May 2022. The current passing rent is £85,000 p.a. and this is to be reviewed upwards only to market value on 16th May 2017. The lease incorporates a tenant option to break on 16th May 2017.
Vodafone Ltd took the lease on assignment from Phones 4 U Ltd (in administration) in September 2014. Vodafone have been trading in this unit since October 2014 and have recently received landlord’s consent for significant shop-fit alterations.
The upper parts have the benefit of planning consent for B.1(c) (manufacturing of clothes and light industrial use, A2 (professional and financial service and B.1 (office accommodation). We also believe these premises offer the potential of a residential conversion, subject to planning. The vendor will provide a top-up of £14,500 p.a. for a period of one year from completion. The total income, therefore is £99,500 p.a.
Market Rent
We have devalued the passing rent to reflect £70.50 Zone A. This analysis applies a 5% premium for the valuable return frontage on Westgate Street. Prime rents reached £145 Zone A during the last occupational cycle. The subject property was let in 2012 to Phones 4 U. Following Phones 4 U entering administration, Vodafone subsequently took assignment of the lease in October 2014. We believe that this demonstrates that the passing rent has been rebased to an attractive and sustainable level. The subject property occupies an exceptional location and offers a well-configured corner retail unit within the prime pitch. Looking ahead, with vacancy rates now falling and the wider economic recovery strengthening, we believe the property is well placed to benefit from the rental recovery. The upper parts have recently been vacated by a light clothing manufacturer. We believe these premises could be suited to a range of uses and have a current market value in the order of £14,500 p.a. reflecting approximately £6 psf.
2-4a Southgate Street, Gloucester
Covenant Information
Vodphone Limited (Registered Number: 00636095)
Date for Accounts
Sales Turnover Pre-tax Profit/(Loss)
Net Worth
31/03/2014 £6,969,200 (£304,800) (£1,658,000)
31/03/2013 £5,062,500 £n/a (£1,629,200)
31/03/2012 £5,364,200 (£61,300) (£3,044,800)
2-4a Southgate Street, Gloucester
Further Information
For further information please contact:
Bradley MaherDDI: 020 7016 5348Mob: 07827686461E: [email protected]
Prime Retail Property Consultants2 Conduit StreetLondonW1S 2XB
Julian CapewellDDI: 01452 880063Mob: 07803 022350E: [email protected]
Bruton KnowlesBisley HouseGreen Farm Business ParkBristol RoadGloucester, GL2 4LY
VAT
The property is elected for VAT. It is anticipated that the sale will be structured as a Transfer of a Going Concern (TOGC).
Tenure
The property is held freehold.
EPC
A full copy of the energy performance certificates are available on request. The retail unit achieved a rating at level C (64) and the upper parts a rating of C (69).
Proposal
We are instructed to seek offers in excess of £1,250,000. Allowing for standard purchaser’s costs of 5.8% and including the landlord’s guarantee in respect of the upper parts, this price would reflect an attractive 7.52% NIY.
Property Consultants
Misrepresentation Act 1967Prime Retail Property Consultants LLP as agents for the vendors or, as the case may be, Lessor (the “Vendor”) and for themselves, give notice that 1. These particulars are provided merely as a general guide to the property. They are not and shall not hereafter become part of any offer or contract; 2. The statements herein are made in good faith but without any responsibility whatsoever on the part of the Vendor, Prime Retail Property Consultants LLP or their servants. It is for the Purchaser or as the case may be Lessee (The “Purchaser”) to satisfy himself by inspection or other-wise as to their accuracy and fullness, he must not in entering into any contract or otherwise rely upon these particulars as statement or representations of fact. 3. The Vendor does not make or give neither Prime Retail Property Consultants LLP nor its servants any authority, express or imply, to make or give any representations or war-ranties in respect of the property. 4. In the event of any inconsistency between these Particulars and the Conditions of Sale, the latter shall prevail. 5. Nothing in these par-ticulars should be deemed to be a statement that the property is in good condition or that any service or facilities are in working order. Subject to contract March 2015.