Folkestone NCP Final - Allsop

NCP CAR PARK, ALEXANDER GARDENS, MIDDLEBURG SQUARE, FOLKESTONE CT20 1AU

FOLKESTONE

PRIME LONG INCOME CAR PARK INVESTMENT WITH ANNUAL RPI UPLIFTS LET TO NCP FOR A FURTHER C. 16.5 YEARS

FOLKESTONE NCP CAR PARK, ALEXANDER GARDENS, MIDDLEBURG SQUARE, CT20 1AU PRIME LONG INCOME CAR PARK INVESTMENT WITH ANNUAL RPI UPLIFTS LET TO NCP FOR A FURTHER C. 16.5 YEARS

› Saga have their UK headquarters in Folkestone and the car park is located immediately opposite to their 7 storey owner occupied ‘The Saga Building’, providing convenient parking to its staff

› Situated 10 minutes south of Folkestone Central Train Station and the UK’s only high speed line – the HS1.

› Passing rent equates to a net rent payable of just £567 per space

› Freehold

› Whilst some national covenants have not paid their rent during the pandemic NCP have been paying the subject property’s rent

››› INVESTMENT CONSIDERATIONS

› Multi-storey car park located in the very heart of Folkestone Town Centre

› Let to the strong covenant of National Car Parks (NCP) Limited for an unexpired term of c. 16.5 years

› Rent passing of £311,288 pa subject to RPI annual increases (1.5%-5% collar and cap)

› Ideally located to serve Folkestone’s two principal retailing pitches with the Bouverie Place Shopping Centre located opposite and Sandgate Road a short 5 minute walk south

› NCP sublet 466 spaces to Saga Group Limited, working hours Monday to Friday only, for circa £333,000 p.a. - which is more than NCP’s current rent p.a

››› PROPOSAL

› Offers are sought in excess of £5,310,000 (Five Million Three Hundred and Ten Thousand Pounds) which reflects a NIY of 5.50% subject to contract and exclusive of VAT, allowing for purchaser’s costs of 6.61%.

Based on 3% annual increases the running yield will be as follows:

Date Rent Running Yield

June 2025 £360,868 6.38%

June 2030 £418,345 7.39%

June 2035 £484,977 8.57%


A21

A22

A27 A27

A24

A23

A22

A26

A2

A272

A259

A272

A272

J12

J10

J7J8

J9

J6

J5

J3

J2

M4

M2

M3

M25

M25

M23M20

M20

DOVER

Hastings

Eastbourne

SevenoaksMAIDSTONE

Hove

Crawley

Guildford

Woking

ROYALTUNBRIDGE WELLS

Tonbridge

Lewes

BRIGHTONLittlehampton

Margate

CANTERBURY

Sittingbourne

Sandwich

Southend-on-sea

Gravesend

Croydon

AshfordGatwick

Heathrow

London City

FOLKESTONEFOLKESTONE

LONDON

››› LOCATION

Folkestone is a major retail and commercial centre situated on the south east coast of Kent, approximately 70 miles (112 km) south west of central London and 8 miles (13 km) south west of Dover.

The town benefits from excellent road communications being located at the eastern end of the M20 which provides direct access to Ashford, Maidstone, the M25 and London. Folkestone also marks the eastern end of the A259 south coast trunk road.

The town is served by two mainline railway stations, Folkestone Central and Folkestone West which provide regular services to nearby centres and London.

The terminus of the High Speed 1 (previously known as the Channel Tunnel Link) is situated to the north of the town. The nearest international station is Ashford which provides high speed trains to the continent.

RAIL - HIGH SPEED TRAVELAIR

Folkestone is located on the A259 which links directly with Junction 13 of the M20 and A20 for access to London and Dover respectively.

Folkestone Central Railway Station provides direct services to Stratford International in 47 minutes and King’s Cross St Pancras in 54 minutes via HS1. Folkestone West offers routes along the south east including Ashford (12 mins) & Dover (11 mins).

Folkestone benefits from being situated on the UK’s only high speed line – the HS1. Folkestone Central offers direct services to London’s King’s Cross St Pancras and Stratford International with a fastest journey time of under one hour. Folkestone West provides regular rail service to London Charing Cross with a fastest journey time of 1 hour 30 minutes.

London Ashford (Lydd) Airport is a 35 minute drive to the south west and Gatwick International Airport is just over an hour to the west.

Dover 8 miles (13 km)

Ashford (Lydd) 16 miles (26 km)

Maidstone 35 miles (56 km)

M25 London 55 miles (88 km)

Dover 11 mins

Stratford International 47 mins

Maidstone 53 mins

King’s Cross St Pancras 57 mins

ROAD RAIL

RESIDENTIA

L DW

ELLIN

GS

FOLKESTONE BUS STATION


FOLKESTONE CENTRAL RAILWAY STATION

10 MINS

FOLKESTONE COAST 10 MINS

THE LEAS

7 M

INS

FOLKESTONE HARBOUR ARM

15 MINS

››› SITUATION

The property is situated in Folkestone Town Centre and occupies a prominent site benefiting from both north and south frontages onto Middleburg Square. The property is moments from the 256,000 Sq ft Bouverie Place Shopping Centre which represents Folkestone’s prime pitch and is anchored by a 86,000 sq ft Asda. Folkestone’s further principal retail offering is located in the pedestrianised section of Sandgate Road, a 5 minute walk to the south.

Major employers in the town include Church and Dwight, the US company famous for such brands as Arm & Hammer and insurance firm Saga – both have their UK headquarters in the town. The Saga Building, a 7-storey office building owned by Saga and used by Saga staff is located immediately opposite to the subject property to the west and offers convenient parking to Saga staff.

Folkestone bus station is located directly opposite on the property’s southern side whilst the area immediately to the north is predominately residential. Further to the north is Folkestone Central Train Station, which is a 10 minute walk from the subject property. Folkestone’s The Leas promenade is a 5 minute walk to the south followed by Folkestone Harbour and the town’s coastline.

There are a number of national multiple retailers in close proximity including Primark, TK Maxx, SportsDirect, Next, Boots, Wilko’s and Superdrug.

© Crown Copyright, ES 100004106. For identification purposes only.

(Owne

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upied

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››› DESCRIPTION

The property is a standalone multi-storey car park over lower ground, ground and 3 upper floors, including one level of rooftop parking. The property provides for 549 car spaces and benefits from a prominent frontage onto Middleburg Square with vehicular access via a slip road from the north, which bends round to the entrance at the east side of the property at ground floor level. The exit is from the lower ground level, again from the east of the property, and comprises a slip round to the south side of Middleburg Square.

There are two stairwells servicing the upper floors of the property on the east and west side of the property. There are two lifts serving all floors.

››› TENURE

Freehold.

››› SITE AREA

The total site area is 1.12 acres / 0.45 hectares.


››› TENANCYThe property is let in its entirety to National Car Parks Limited on a full repairing and insuring lease until 28th May 2037 with no breaks as per the tenancy schedule below:

››› SUMMARY OF SAGA UNDER-LEASES*National Car Parks Limited currently sublet 466 spaces to Saga Group Limited by way of two under leases. The subleases are for Monday to Friday 7am-7pm only. Information on the two under-leases can be found in the below tenancy schedule:

Premises Date Term Breaks Rent Rent review Undertenant 1954 Act security of tenure

371 car parking spaces on levels 1/5/6/7/8/9

16.03.2005 82 years commencing on 01.04.2003

Tenant has the ability to terminate the lease in whole or part on 6 months’ notice at any time.

£270,893.90 Annual RPI reviews on 1 April each year. Review due 1 April 2019.

Saga Group Limited

Included

85 car parking spaces on levels 2 and 3

25.11.2014 01.04.2012 to 15.05.2037

Tenant has the ability to terminate the lease in whole or part on 6 months’ notice at any time.

£62,061.80 Reviewed at the same time as the lease of 371 spaces. The rent is to be the Tenant’s Percentage of the rent payable under the lease of 371 spaces – i.e. the same rate per space as is payable under the lease of 371 spaces.

Saga Group Limited

Excluded. However, if NCP exercises its option to extend its lease by 20 years then Saga has the option to take a further lease for a term of 19 years and 355 days.

Property Tenant Lease start Lease End Rent p.a. Rent review Rent per space Comments

NCP Folkestone Middleburg Square

National Car Parks Limited

29th June 2002

28th May 2037 £311,288.53 Annual RPI linked (collar 1.5% and Cap 5%)

£567 The tenant has an option to renew the tenancy for a further 20 years on identical terms, at the rent then passing. The lease is Outside the 1954 Landlord & Tenant Act.

*We understand from NCP that Saga have paid their rent for the subject property during Covid. Information for sub-leases has been provided by NCP, any parties should carry out their own due diligence.


››› DEMOGRAPHICS & TOURISM

Folkestone is the principal town in the Shepway District of Kent with a population of 53,451, a primary catchment area of 90,000 and an estimated Consumer Base of 76,000. The town is projected to see above average growth in population within its Retail Market Area over the period 2019-2024. Whilst Folkestone has an above average retiree population it has seen a significant increase in young adults aged 15-24 in the last two decades. The level of car ownership in Folkestone is around 74% of households owning at least one car.

Tourism is a major part of the Folkestone economy with Folkestone & Hythe estimated to have a total tourism value of £252 million showing 2% annual growth. Statistics show that 4.3 million day trips were taken to the area in 2017 with the town a popular seaside resort for day-trippers due to its excellent transport links.

74% OF HOUSEHOLDS IN FOLKESTONE OWN AT LEAST ONE CAR

£252M ESTIMATED TOTAL TOURISM VALUE

2% PROJECTED ANNUAL TOURISM GROWTH

76,000 ESTIMATED CONSUMER BASE

››› ALTERNATIVE USEThe property is situated on the edge of Folkestone’s Central Business District with a predominately-residential area to the north, Folkestone’s prime retailing pitches of Bouverie Place Shopping Centre and Sandgate Road to the south and Saga’s 7-storey office building immediately opposite to the west. As such, the property is ideally located to lend itself to a number of potential redevelopment uses (subject to the necessary consents and vacant possession), with any mixed-use scheme benefiting from excellent connectivity to central London (57 minutes to London’s King’s Cross St Pancras).

The closest major residential conversion/development to the subject property is the 36 dwelling scheme at Europa House, 5 minutes south from the subject property. There has also been a number of conversions of care homes to residential in close proximity.

Furthermore, due to its location in a built up area the property benefits from a large captive consumer base and a well-connected and central positioning meaning the property could also lend itself to conversion to a storage facility, again subject to the necessary consents.

Source: CACI


››› POST COVID CAR USE*

Government Guidance to use carsThe Government has stated that all other forms of transport should be considered over public transport and has implemented a number of driver friendly measures to encourage car use during Covid

The public want to drive46% of respondents said say they are more likely to drive than use public transport with only 1 in 5 happy to use public transport in the future

Can social distancing be observed outside of a car?92% of respondents don’t think social distancing on public transport will be feasible and will continue to stay away from public transport unless social distancing is in place

Public interest in purchasing cars has spikedOn the day of Prime Minister’s easing of lockdown measures traffic on Autotrader peaked at more than 1m views, the highest since the lockdown began in March

Transport usage by type(index comparing usage to pre-Covid periods)

-

20

40

60

80

100

120

9-Mar 29-Mar 18-Apr 8-May 28-May 17-Jun

Vehicles Rail Bus (exc. London)

*Source Passenger Focus

Increase in Car use compared to Public TransportPublic transport use has remained very low whereas vehicle use has returned to c.80% of pre-Covid levels

*Source Passenger Focus

FOLKESTONE NCP CAR PARK, ALEXANDER GARDENS, MIDDLEBURG SQUARE, CT20 1AU

››› NCP COVENANT (Subject Property Tenant)

NCP is the UK’s most recognised and longest standing private

car park operator being founded in 1931. NCP operates car parking spaces across the UK at over 500 sites for approximately 150,000 cars, possessing a 30% market share. NCP Limited is jointly owned by Park24 and the Development Bank of Japan (DBJ), both investment grade rated businesses with substantial cash generation potential and cash/capital reserves relative to the NCP Group.

The joint venture (JV) purchased NCP Limited in July 2017 for an indicative enterprise value of £440 million. As part of the Acquisition 100% of the NCP Group’s external debt was repaid. Park24 is a listed Japanese company based in Tokyo, and is a major parking operator with over 1 million spaces in 19,000 sites across 8 countries. DBJ is a Japanese Government owned financial institution with a strong track record in infrastructure finance.

››› SAGA COVENANT (NCP’s Undertenant)

Founded in 1951 and currently working with 2.1 million members,

Saga has become one of the most recognised brands providing an extensive range of products for its over 50’s customer base. Initially, focused on travel arrangements including cruises, Saga have now diversified their product offer to include home and motor insurance, pet and private medical insurance, and financial services such as wealth management, loans and savings, whilst remaining loyal to its previous customer base.

The Founder of Saga, Sidney De Haan, established the company in Folkestone which still remains the headquarters for the company. Saga, the largest employer in Folkestone, has always had a special connection with the town, reinforced by the multi million pound investment into its regeneration by Sir Roger De Haan (previous owner of Saga) including Creative Folkestone and the 1,000 new home redevelopment on the Coast.

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››› TOWN CENTRE LOCATION

Located in the centre of Folkestone close to the town’s attractions including the seafront and beach, The Leas promenade and Folkestone Harbour.

››› RETAIL THERAPY

Located directly opposite to The Bouverie Place Shopping Centre, Folkestone’s prime Town Centre retail offering, and 5 minutes north of Sandgate Road.

PRIME LONG INCOME CAR PARK INVESTMENT WITH ANNUAL RPI UPLIFTS LET TO NCP FOR A FURTHER C. 16.5 YEARS

››› HS1

Situated 10 minutes south of Folkestone Central Train Station, the UK’s only high speed line The HS1, with access to King’s Cross St Pancras in just over an hour.

››› SAGA STAFF PARKING

Conveniently located opposite to the Saga Owned ‘Saga Building’, ideally placed to serve the building’s staff members.

››› TOURISM

4.3 million day trips a year with Folkestone & Hythe estimated to have a total tourism value of £252 million.*

Saga Group Limited have reported the following financial accounts:

Year Ending 31/01/2019 (£’000s)

31/01/2018 (£’000s)

31/01/2017 (£’000s)

Turnover £35,864 £39,925 £44,969

Pre Tax Profit £84,426 £41,430 £70,621

Net Worth £894,302 £944,830 £221,402

NCP Limited have reported the following financial accounts:

Year Ending 30/09/2018 (£’000s)

31/03/2017 (£’000s)

25/03/2016 (£’000s)

Turnover £326,490 £211,461 £202,703

Pre Tax Profit -£24,697 £24,793 £28,001

Net Worth £139,922 £210,138 £186,896


FOLKESTONE RENAISSANCEWith the benefit of frequent HS1 trains into London in under an hour and an increasing amount of commuters opting for the trendy seaside town with affordable residential prices, Folkestone has rapidly changed over recent years. The town has seen significant investment in the old town and harbour area and has become a fashionable and creative focal point for Kent’s Coastline boasting some of the county’s best eateries, artworks and cultural activities.

Much of Folkestone’s initial transformation has come from via the significant private investment of billionaire Roger De Haan, the son of Sidney de Haan, the founder of Saga, who has worked alongside other private investors and the government to invest millions into the Town.

FOLKESTONE SEAFRONTFolkestone Harbour Company have begun to undertake a development of 1,000 new homes on the seafront including up to 10,000 square metres of commercial floorspace. The development also includes new sea sports and beach sports facilities, improvements to the beaches, pedestrian and cycle routes and parking.

SHORNCLIFFE HEIGHTSThe former Ministry of Defence site has gained planning permission for a development of 1,200 new homes including affordable housing, community services, a new primary school and a nursery. Furthermore there will be a combined new pavilion/cadet hut facility at The Stadium, retained cricket pitches including mini football pitches and a public open space.

CREATIVE QUARTERSet in the old town, Folkestone Creative Quarter is an urban village of designers, filmmakers, musicians, web developers and artists. Over 90 buildings have been restored and transformed to be used for circa 80 flats, 115 studios, offices and over 50 shops, making it a hive of activity. It has become an example of best practice for creatively led regeneration, which received a £50 million cash injection from Roger De Haan.

FOLKESTONE ART SCENEFolkestone has the largest urban outdoor collection of contemporary art in the UK with 74 artworks including outdoor sculptures. Paired with live music on the coast and the Creative Quarter, Folkestone is becoming popular with art enthusiasts, tourists and local residents equally.

BOOMING FOOD DESTINATIONFolkestone has a growing reputation as a foodie hotspot, from high-end restaurants overlooking the harbour like Rocksalt (two AA rosettes), to street food delights on the Harbour Arm and independent restaurateurs in the newly developed Creative Quarter, it now is now one of Kent’s go to locations for good food.

Antony Gormley- Another Time Folkestone Triennial 2017

››› VATThe property has been elected for VAT and it is anticipated that the transaction will be treated as a TOGC.

››› ANTI-MONEY-LAUNDERINGA successful bidder will be required to provide information to satisfy the AML requirements when Head of Terms are agreed.

››› DATAROOMFor access to the Allsop dataroom please use the following link: https://datarooms.allsop.co.uk/register/NCP-Folkestone

››› PROPOSALOffers are sought in excess of £5,310,000 (Five Million Three Hundred and Ten Thousand Pounds) which reflects a NIY of 5.50% subject to contract and exclusive of VAT, allowing for purchaser’s costs of 6.61%

Based on 3% annual increases the running yield will be as follows:

Date Rent Running Yield

June 2025 £360,868 6.38%

June 2030 £418,345 7.39%

June 2035 £484,977 8.57%

Liam Stray07956 [email protected]

For further information or to make arrangements for viewing please contact:

Gergo Petrovics07961 [email protected] allsop.co.uk

Misrepresentation Act: 1. Allsop LLP on its own behalf and on behalf of the vendor/lessor of this property whose agent Allsop LLP is, gives notice that: (a) these particulars do not constitute in whole or in part an offer or contract for sale or lease; (b) none of the statements contained in these particulars as to the property are to be relied on as statements or representations of fact; and (c) the vendor/lessor does not make or give, and neither Allsop LLP nor any of its members or any person in its employment has any authority to make or give, any representation or warranty whatsoever in relation to the property. The only representations, warranties, undertakings and contractual obligations to be given or undertaken by the vendor/lessor are those contained and expressly referred to in the written contract for sale or agreement for lease between the vendor/lessor and a purchaser or tenant. 2. Prospective purchasers or tenants are strongly advised to: (a) satisfy themselves as to the correctness of each statement contained in these particulars; (b) inspect the property and the neighbouring area; (c) ensure that any items expressed to be included are available and in working order; (d) arrange a full structural (and where appropriate environmental) survey of the property; and (e) carry out all necessary searches and enquiries. Allsop is the trading name of Allsop LLP. Design CommandD www.commandHQ.co.uk 09.20

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Folkestone NCP Final - Allsop