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Solihull Gate Retail ParkStratford Road (A34), Solihull, Birmingham, B90 4BA
A Prime Retail Investment Opportunity
ENTER
Investment Summary Location – Solihull is one of the UK’s most affluent towns and one of Birmingham’s most attractive residential suburbs.
Place Making – This park forms part of Solihull’s principal out of town retail hub, serving not only Solihull but the wider south-east Birmingham conurbation.
Captive Catchment – Within a 10 minute drive time, there is in excess of 100,000 people. In addition there are over 22,800 cars passing the property every week, which is highly visible from the A34, (Stratford Road).
44,963 sq ft Floor Space – A resilient and flexible layout with the ability to either sub-divide or combine units.
Strong Trading Profile – All the occupiers report strong trading in what is a key location.
Institutional Income Stream – Secured from strong covenants with a WAULT of 6.6 years to expiry.
Price – A price is sought of £18,700,000, reflecting an attractive net initial yield of 7% after allowing for purchaser’s costs of 6.74%.
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1.
Investment Summary
Aerial View Location Demographics Local Economy
Retail Warehousing in Solihull
Description Tenure, Planning Tenancy Schedule
ERV, Tenant’s Covenants
Investment Comparables
VAT / EPC Proposal, Contact
2
A34
B4102
SEARS RETAIL PARK
SOLIHULL RETAIL PARK
SOLIHUL GATE RETAIL PARK
2.
Investment Summary
Aerial View Location Demographics Local Economy
Retail Warehousing in Solihull
Description Tenure, Planning Tenancy Schedule
ERV, Tenant’s Covenants
Investment Comparables
VAT / EPC Proposal, Contact
SOLIHULL GATE RETAIL PARK
LocationSolihull is the most affluent town in the west Midlands conurbation, located approximately 8 miles south-east of Birmingham and 18 miles west of Coventry.
The town benefits from excellent road and rail communications, being within 2 miles of junctions 4 and 5 of the M42 motorway, which links with the M40, M5 and M6. Rail services to London Marylebone have an approximate fastest journey time of 1 hour and 20 minutes. There are also quick (50 minutes) and frequent (96 trains per day) rail services between Solihull and Birmingham (Snow Hill).
Unlike central Birmingham, the industrial revolution largely passed Solihull by and the town developed in the 20th century, principally as an attractive and affluent residential suburb.
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EASTMIDLANDS
BIRMINGHAM
GLOUCESTERSHIRE
2
123
24
4
2
18
9
10
11
12
13
14
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3
4
16
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321
5
6
7
11
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131415
78
9
10
4
56
15
16
2
1
20
19
18
17
9
856
78
21
2
1
11
1
2
5
6
3
25
24
23
22
26
2716
10
11
12
13
14
15
2
67 5
M40
M40
M40
M1
M1
M1
M5
M5
M5
M50
M45
M6
M6(T)
M6
M5 M42
M42
M42
M69
M54
M48
A44
9
A4112
A438
A40
A49
A4103
A40
A438
A419A433
A465
A48
A436
A417
A44
A40
A42
9
A40
A44
A44
A40
A46
A46
A46
A607
A52
A1
A607A606
A47
A6
A427
A5
A508
A40A418
A41
A4
010
A43
A420
A34
A43
A422
A419
A458
A50
A51
A5
A50
A38A42
A34
A38
A52
A52
A53
A500
A515
A449A448
A441
A435
A429
A428
A508
A442A44 A46
A45
Cirencester
Didcot
Stroud
Witney Kidlington
Cwmbran
Marlow
LeightonBuzzard
Thame
Abingdon
Bicester
Aylesbury
Daventry
Banbury
Newark-on-Trent
Grantham
Evesham
Bromsgrove
GreatMalvern
Tewkesbury
Nantwich
Newport
Chepstow
Hereford
Uttoxeter
Ashbourne
Cirencester
Didcot
Stroud
Witney Kidlington
Cwmbran
Marlow
LeightonBuzzard
Thame
Abingdon
Bicester
Aylesbury
Daventry
Banbury
Newark-on-Trent
Grantham
Evesham
Bromsgrove
GreatMalvern
Tewkesbury
NantwichWrexham
Newport
Chepstow
Hereford
Uttoxeter
Ashbourne
Redditch
Cheltenham
Newport
HighWycombe
Oxford
Milton Keynes
LeamingtonSpa
Gloucester
Cannock
Newcastle-Under-Lyme
Stafford
Crewe
Redditch
Cheltenham
Newport
HighWycombe
Oxford
Milton Keynes
LeamingtonSpa
Gloucester
Cannock
Newcastle-Under-Lyme
Stafford
Crewe
Wigston
Eastwood
Ilkeston
Rugeley
Stone
Halesowen
Telford
West Bromwich
Walsall
Dudley
Kidderminster
NuneatonHinckley
Burton uponTrent
Rugby
LEICESTER
WOLVERHAMPTON
BIRMINGHAM
DERBY
COVENTRY
BIRMINGHAM
LEICESTER
WOLVERHAMPTON
NOTTINGHAMNOTTINGHAMDERBY
COVENTRY
SOLIHULL
Dicken
s Heath Rd
B
4102
B410
2
B4102 B4025
Mon
kspa
th H
all R
d
Widney M
anor Rd
Widney Rd
Longmore Rd Widney Ln Widney Ln
B4102
Sharmans Cross Rd
Danford Ln
Stratford Road Stratford Road
Stratford Road Stratford Road
Shirley
Monkspath
Solihull
Dickens Heath
M42SOLIHULL GATE
RETAIL PARKSolihull is one of the UK’s most affluent towns and one of Birmingham’s most attractive residential suburbs.
3.
Investment Summary
Aerial View Location Demographics Local Economy
Retail Warehousing in Solihull
Description Tenure, Planning Tenancy Schedule
ERV, Tenant’s Covenants
Investment Comparables
VAT / EPC Proposal, Contact
Demographics Solihull is the most affluent town in the West Midlands and is one of the most affluent areas in the UK, outside London. The ‘You Switch Quality of Life Index’ named Solihull as ‘The Best Place to Live’ in the United Kingdom.
PMA class Solihull as a “Regional Centre” on the basis of the volume and quality of its town centre provision. The total population within the Solihull Primary Retail Market Area is estimated at 240,000 people, of which PMA estimates 225,000 form the consumer base of Solihull.
The CACI 10 minute drive time for the subject property gives a total population of 104,000 people. The more affluent social grades AB are significantly over represented within the catchment at 51%, in excess of the UK average, with the C1 social grade also above the national rate. In contrast the least affluent social grades C2, D2 and DE are relatively under represented.
The Solihull CACI 10 minute drive time also reports on weekly expenditure and generally those categories under “Furnishings, Household Equipment and Routine Household Maintenance” show above average spending, as compared to the UK average.
In terms of households, CACI classify some 56.4% as “Affluent Achievers” with only 10% and 4% classed as “Financially Stretched” and “Urban Adversity”, respectively.
The “ACORN” group profile report that out of a 10 minute catchment of 107,000 people, 31,400 could be described as “Executive Wealth” (236% of the UK average Index), some 24,700 as “Mature Money” (254%) and finally 14,500 as “Successful Suburbs” (220%).
All the statistics show that Solihull has a most affluent catchment population. For good reason it is generally regarded as Birmingham’s most attractive and desirable residential suburb.
M42
M42
M40
M5
Solihul
4.
Solihul
Dickens Heath
Wood End
Bicken Hill
Balsall HeathSouth YadleyEdgbaston
Hollywood
Wythall Green
Hockley Heath
Dorridge
Brandwood Yardley Wood
SOLIHULL GATERETAIL PARK
The CACI socio-economic classifications are set out below for the 10 minute drive time:
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NS Socio Economic Classification Profile % for Area % for Base Index 0 100 200
All People aged 16- 74 74,316 100 100 100
1. Higher Managerial, administrative and professional occupations 11,145 15.0 10.1 148
1.1 Large employers and higher managerial and admin occupations 2,412 3.2 2.3 142
1.2 Higher professional occupations 8,733 11.8 7.8 150
2. Lower managerial, administrative and professional occupations 18,343 24.7 20.8 119
3. Intermediate occupations 11,157 15.0 12.8 118
4. Small employers and own account workers 6,815 9.2 9.2 99
5. Lower supervisory and technical occupations 4,060 5.5 7.1 77
6. Semi-routine occupations 8,655 11.6 14.2 82
7. Routine occupations 5,089 6.8 11.3 61
8. Never worked long-term unemployed 3,291 4.4 5.5 80
9. Full time students / SEC unclassified 5,761 7.8 9.0 86
Solihull has been named as ‘The Best Place to Live’ in the UK. (You Switch Quality of Life Index)
4.
The 10 minute drive time
Investment Summary
Aerial View Location Demographics Local Economy
Retail Warehousing in Solihull
Description Tenure, Planning Tenancy Schedule
ERV, Tenant’s Covenants
Investment Comparables
VAT / EPC Proposal, Contact
Local EconomyThe town’s accessibility makes it an attractive location for office occupiers, many of whom are located on out of town business parks.
The service sector as a whole accounts for 63% of the total employment in Solihull above the national average.
The professional and business sector includes St James Place and Prime Chartered Accountants.
Furthermore, National Grid Transco and NPower have large offices in the town centre.
The ICT sector is well represented on the M42 business parks, especially Birmingham Business Park and Blythe Valley with occupiers including Fujitsu, Nokia, Siemens, Oracle and ASOS. Virgin Media announced at the start of 2015 that they plan to create 1,000 new apprentice positions at its Eagle Court facility as part of a nationwide expansion. Additionally Blythe Valley Park also accommodates a number of large offices for international construction/engineering firms such as Enzen, Kier Group and Arup.
Excellent road communications have made Solihull an attractive location for distribution/transport firms. Furthermore, there is a successful conference industry based around the NEC.
Birmingham International Airport lies just to the north of the catchment and an extension to the runway was completed in 2014, now making long-haul flights possible.
The manufacturing sector in Solihull accounts for 10% of the total employment with the automotive industry of particular significance. Both Jaguar Land Rover and BMW operating major facilities within the area. JLR has recently revealed plans to expand its Solihull factory in order to facilitate the development of electrical equipment for the company’s cars and plans to hire a further 1,000 employees in addition to the 10,000 staff currently employed. The manufacturer has also submitted plans to build a 1m sq ft logistics operations centre at Damson Parkway, near the Solihull factory.
In March 2018, the local unemployment count was 0.7% of the population aged 16-64, as compared to the national unemployment count at 1.1%.(PMA)
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5.
Investment Summary
Aerial View Location Demographics Local Economy
Retail Warehousing in Solihull
Description Tenure, Planning Tenancy Schedule
ERV, Tenant’s Covenants
Investment Comparables
VAT / EPC Proposal, Contact
Retail Warehousing in SolihullTotal retail warehouse supply for Solihull is estimated at 568,000 sq ft with an overall provision per household below the PROMIS average. In particular, the DIY and furniture/furnishing are relatively under represented.
The vast majority of retail warehousing is situated around the subject property, adjoining Marshall Lake Road (B4102) close to its junction
with Stratford Road (A34).
Immediately behind the subject property is Solihull Retail Park totalling 190,000 sq ft anchored by B&Q, who extended in 2012, together with Currys / PC World. Other tenants include Halfords, Pets at Home, Hobbycraft, Dreams and SCS.
Adjacent to this is Sears Retail Park totalling 125,000 sq ft, which is generally occupied by “softer” retailers including Boots, Argos, M&S Foodhall, Homesense and TK Maxx.
Adjoining this is a new format Next lifestyle store of 30,000 sq ft which was completed in June 2014.
Adjacent to the Sears Retail Park is a former Toys ‘R’ Us unit of 44,000 sq ft which was owned freehold by the related property company. We understand however there is good interest in a sub-division of this unit with the main area going to one of the discount food retailers.
Finally, adjoining Solihull Retail Park and the former Toys ‘R’ Us, but fronting onto Stratford Road, is a large state-of-the-art Sainsbury’s of some 80,000 sq ft which forms the principal food offer for the surrounding area.
On Stratford Road there are some solus retail warehousing units and notably a 27,000 sq ft store recently occupied by Sports Direct diagonally opposite the subject property, and fitted out to the retailer’s latest format.
At the roundabout junction between Marshall Lake Road and Stratford Road, is an impressive Porcelanosa destination store.
All in all, this immediate location should provide investors with the ideal scenario of being situated in a strong and established retail pitch which is relatively under supplied as compared to the strength of the catchment. Furthermore, we are not aware of any further retail developments proposed which would materially increase the supply of accommodation.
6-7
6.
44,963 sq ft Floor Space – a resilient and flexible layout with the ability to either sub-divide or combine units.
Investment Summary
Aerial View Location Demographics Local Economy
Retail Warehousing in Solihull
Description Tenure, Planning Tenancy Schedule
ERV, Tenant’s Covenants
Investment Comparables
VAT / EPC Proposal, Contact
LOCAL OCCUPIERS »
SOLIHUL GATE RETAIL PARK
7.
6-7
Investment Summary
Aerial View Location Demographics Local Economy
Retail Warehousing in Solihull
Description Tenure, Planning Tenancy Schedule
ERV, Tenant’s Covenants
Investment Comparables
VAT / EPC Proposal, Contact
138.1m
139.0m
139.0m
TCB
Path
KFORD
ROAD
STRATFORDROAD
CHAL
FORD
WAYHARWOOD GROVE
El Sub Sta
El Sub Sta
568
5
24 11
Works
41
11a
8
Ardendale
2
8
Quinton
dale
5
6
22
7
6a
30
586
645 a to f
12a
14
647 a to f
7
566
esby
tery
576
2
Henleydale
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12
603
607
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1417
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1510
714 11
9 125 16
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6 3
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1012
a16
1215
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36
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Shelter
Shelter
Tanks
Shelter
138.7m
68
19
655 a to f
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8
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Solihull
109
677
657 a to f
36
26a
665 a to f
2
667 a to f
675
1
18
14
3
18a
1610
Retail Park
0m 20m 40m 60m
Ordnance Survey © Crown Copyright 2018. All rights reserved. Licence number 100022432. Plotted Scale - 1:1431
DescriptionThe development comprises an attractive terrace currently arranged as 4 units totalling 44,963 sq ft. The development is currently arranged in unit sizes between 10-15,000 sq ft. It was completed in May 2007 to a high specification to include full glazing to the store entrances, contrasting profile metal sheeting with a large area for occupier signage and block paving adjoining the entrances. It is otherwise of standard retail warehouse construction with a steel portal frame structure and pitched roofs. There is a customer vehicle entrance/exit to the eastbound carriageway of the A34 with roundabout junctions on either side of the scheme to permit easy access to both sides of the carriageway. This segregated servicing with an entrance from Marshall Lake Road at the back of the development. The customer and vehicle entrance is shared with the adjoining Jaguar Land Rover showrooms. There is car parking for 171 customer cars, giving a ratio of 1:263 sq ft. There is a site area of 2.99 acres (1.21 ha) giving a low site cover of 34.5%.
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Tenant Area (Sq Ft)
Lease Start Lease End Next Rent Review
Rent (p.a) Rent (Per Sq Ft)
Wren Kitchens Ltd 9,957 10-Apr-2013 09-Apr-2023 £296,221 £29.75
Sofology Ltd 14,985 08-Apr-2013 07-Apr-2023 £445,804 £29.75
Tapi Floors & Carpets 10,021 24-Jul-2017 23-Jul-2027 24-Jul-2022 £330,693* £33.00
Furniture Village Ltd 10,000 04-May-2007 03-May-2027 04-May-2022 £325,000 £32.50
44,963 £1,397,718 £31.09
Tenancy Schedule
8.Tenure Freehold as delineated in red on the plan opposite.
Planning Consent The development benefits from a “standard bulky goods” planning consent, permitting the sale of DIY, furniture, furnishings, beds, electricals and carpets.
Site Plan The site totals 3.98 acres, giving a low site cover of 34.6%
Environmental Prior to redevelopment in 2006, the site was occupied by a car garage from the 1930s to the 1970s. Some remediation works were carried out prior to the subject development. A Phase One report is available for assignment, which gives the site a low risk rating.
*Tenant currently paying half rent, 24/01/2018 - 23/01/2019 – to be topped up by vendor.
Investment Summary
Aerial View Location Demographics Local Economy
Retail Warehousing in Solihull
Description Tenure, Planning Tenancy Schedule
ERV, Tenant’s Covenants
Investment Comparables
VAT / EPC Proposal, Contact
Estimated Rental ValueThe most recent letting on the scheme was on Unit 2 to Tapi in July 2017 at a headline rent reflecting £33 per sq ft. This letting was subject to just 12 months rent free. This equates to a net effective rent of £30.53 per sq ft. The previous tenant in this unit, Starplan, were paying a marginally lower headline rent reflecting £32.50 per sq ft.
The Solihull Retail Park to the rear, is fully let, having been refurbished and re-geared between 2012/2015. The most recent letting was to Dreams of 7,072 sq ft at £33.00 per sq ft, with effect from March 2015 subject to a 12 month rent free period. Passing rents generally range from £30 - £37.50 per sq ft on the units of between 7-16,000 sq ft and there are no voids on this scheme.
On the Sears Retail Park, the smaller units between 10-15,000 sq ft are let at rents between £30-£38.50 per sq ft. The most recent evidence emanates from a Boots re-gear carried out in April 2016 at £30 per sq ft for 15,346 sq ft.
Adjoining the Sears Retail Park is the ex-Toys ‘R’ Us unit at 44,100 sq ft. We understand there is good interest in occupying this unit on behalf of discount food retailers linked up with either Home Bargains or B&M for the balance.
The Next lifestyle unit of 30,000 sq ft is subject to a lease commencing 24th June 2014 at a rent equating to £26.67 per sq ft.
Overall, we consider the subject scheme can be considered rack-rented. Over recent years, any voids in this overall pitch have been quickly re-let and there is good competition for the available Toys ‘R’ Us unit.
9
Unit Tenant Year Ending Sales Turnover(000’S)
Pre TaxProfit / Loss (000’S)
Net Worth(000’S)
D&B Rating
1A Wren Kitchens Ltd31/12/2017 £406,685 £16,571 £18,594
4A231/12/2016 £338,094 £11,007 £6,153
1B Sofology Ltd*31/12/2016 £143,008 -£8,917 -£14,276
N231/12/2015 £142,860 -£385 -£5,726
2 Tapi Carpets & Floors31/12/2016 £30,294 -£10,195 £8,255
3A202/01/2016 £1,253
3 Furniture Village Ltd02/04/2017 £238,064 £1,675 £13,452
3A127/03/2016 £213,912 £3,864 £13,840
9.
Tenant’s Covenants
*Owned by DFS PLC
Investment Summary
Aerial View Location Demographics Local Economy
Retail Warehousing in Solihull
Description Tenure, Planning Tenancy Schedule
ERV, Tenant’s Covenants
Investment Comparables
VAT / EPC Proposal, Contact
Investment ComparablesSet out below are a number of investment comparables, all of which have transacted since February of this year and most of which are in the general Birmingham area. It will be seen that the price quoted for this property reflects a significant discount to the prevailing net initial yield levels of between 5.2 – 6.0% shown from the comparables. Furthermore the overall quality of this property is considered to be at least as good as all the other properties detailed:
Property Size Sq Ft
Tenants Lease Details Passing Rent (Psf)
Price (£M) Initial Yield
Vendor Purchaser Date
Birmingham (Wednesbury) - Gallagher Shopping Park (aka Junction 9)
230,822 Currys PC World, Next, M&S Foodhall, DFS, Harveys, Bensons, JD, Furniture Village, TK Maxx, Outfit, Boots, Mamas & Papas, ScS, Sofology, Oak, Tapi, Nando’s, Costa, Smashburger, Burger King, KFC, Pizza Hut.
WAULT 10.2 yrs (9.7 inc brks)
£9,474,754 pa (£41.05 psf)
£175,000,000 5.20% KKR (Quadrant Estates)
Korea Asset Investment Management (KAIM) / HANA Financial Investment
Jul-18
Slough - Slough Retail Park
153,000 The Range, Sofology, AHF, ScS, Harveys, Smyths Toys, DFS and Carpetright.
WAULT c. 6.0 yrs £3,526,913 pa £63,030,000 5.44% Benson Elliot Orchard Street May-18
Birmingham - Selly Oak Shopping Park
210,000 Sainsbury’s, Next, M&S Foodhall, JD, Superdrug, Wilko, Card Factory, Costa, Greggs.
N/A N/A £94,000,000 5.00% JV - LandSec / Sainsbury’s
M&G May-18
Birmingham - Longbridge
312,549 M&S, Poundland, Boots, Mountain Warehouse, Smyths Toys, Holland & Barrett, and Card Factory
WAULT 13 yrs+ inc brks
£3,405,933 pa £53,600,000 6.00% St Modwen Columbia Threadneedle May-18
Solihull Sports Direct
26,795 Sports Direct WAULT 10 yrs £589,490 (£22.00 psf)
£10,000,000 5.50% Sports Direct IM Properties Apr-18
Birmingham (Selly Oak) - Battery Retail Park
135,578 Homebase, Currys PC World, Next, TK Maxx, Halfords, Pets at Home, Carpetright, Sports Direct, Poundland, Iceland, Maplin, Frankie & Benny’s.
WAULT 7.15 yrs £3,748,331 pa (£27.67 psf)
£57,500,000 6.00% Hammerson NFU Mutual Feb-18
10
Investment Summary
Aerial View Location Demographics Local Economy
Retail Warehousing in Solihull
Description Tenure, Planning Tenancy Schedule
ERV, Tenant’s Covenants
Investment Comparables
VAT / EPC Proposal, Contact
10.
Contact
Paul Wilkinson
Tel: 020 7317 3799
Mobile: 07770 585 313
Email: paul.wilkinson@avisonyoung.com
Ellie Kirkby
Tel: 020 7317 3790
Mobile: 07764 241 898
Email: ellie.kirkby@avisonyoung.com
11
VATThe property is elected for VAT and it is envisaged that the property will be sold by a way of Transfer of a Going Concern (TOGC).
EPCEPC certificate and recommendation reports are available and can be provided on request.
ProposalWe are instructed to seek a price of £18,700,000 subject to contract and exclusive of VAT. This would give a net initial yield of 7.00%, after allowing for purchaser’s costs of 6.74%.
11.
MISREPRESENTATION NOTICE. Avison Young give notice to anyone who may read these particulars as follows:
1. These particulars are prepared for the guidance only of prospective purchasers. They are intended to give a fair overall description of the property but are not intended to constitute part of an offer or contract. 2. Any information contained herein (whether in the text, plans or photographs) is given in good faith but should not be relied upon as being a statement of representation or fact. 3. Nothing in these particulars shall be deemed to be a statement that the property is in good condition or otherwise nor that any services or facilities are in good working order. 4. The photographs appearing in this brochure show only certain parts of the property at the time when the photographs were taken. Certain aspects may have changed since the photographs were taken and it should not be assumed that the property remains precisely as displayed in the photographs. Furthermore, no assumptions should be made in respect of parts of the property which are not shown in the photographs. 5. Any areas, measurements or distances referred to herein are approximate only. 6. Where there is reference in the particulars to the fact that alterations have been carried out or that a particular use is made of any part of the property, this is not intended to be a statement that any necessary planning, building regulations or other consents have been obtained and these matters must be verified by an intending purchaser. 7. Descriptions of the property are inevitably subjective and the descriptions contained herein are given in good faith as an opinion and not by way of statement of fact. Plans are published for convenience of identification only and although believed to be correct, their accuracy is not guaranteed and they do not form part of any contract. October 2018.
Designed and produced by Creativeworld Tel: 01282 858200.
Investment Summary
Aerial View Location Demographics Local Economy
Retail Warehousing in Solihull
Description Tenure, Planning Tenancy Schedule
ERV, Tenant’s Covenants
Investment Comparables
VAT / EPC Proposal, Contact
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