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Long Let McDonald’s Drive Thru InvestmentMcDonald’s Drive Thru, Berristow Lane, South Normanton DE55 2JL
LOCATION
South Normanton is located in Nottinghamshire 12 miles north west of Nottingham, 3 miles west of Sutton in Ashfield, 8 miles south west of Mansfield and 15 miles north east of Derby.
The town benefits from excellent road communications being situated on J28 of the M1 motorway and adjacent to the A38 dual carriageway.
SITUATION
The property is prominently situated off the A38 dual carriageway on the roundabout for the East Midlands Designer Outlet, half a mile from J28 of the M1.
The East Midlands Designer Outlet is the leading designer outlet village in the Midlands with over 70 stores, cafes and restaurants and attracting over 2.7 million visitors per annum. Occupiers include Marks & Spencer, Superdry, French Connection, GAP, Kurt Geiger, Next, Nike, Tommy Hilfiger, Pizza Express and Starbucks.
The area is also one of the main distribution warehouse hubs for the north Midlands with both Castlewood Business Park and Amber Park Distribution Park in close proximity with occupiers including Co-op, UDG and Norbert Dentressangle.
INVESTMENT SUMMARY
n The property is prominently located on the roundabout for the East Midlands Designer Outlet, half a mile from J28 of the M1
n Modern McDonalds Drive Thru developed in 2012 and extending to 4,105 sq.ft with 32 car parking spaces
n Let entirely to the undoubted covenant of McDonald’s Restaurants Ltd for over 17.5 years
n Current rent £90,000 per annum - £21.92 per sq.ft.
n 5 yearly upward only reviews to open market value
n Freehold
n Offers sought in excess of £1,550,000
n Net initial yield 5.50%, assuming costs of purchase of 5.80%
DESCRIPTION
The property comprises a modern single storey detached McDonald’s drive thru restaurant developed in 2012. The property extends to 381.36 sq.m (4,105 sq.ft) and has been constructed to McDonald’s latest specifications. Externally there are 32 car parking spaces on site.
Access is off both Berristow Lane and Carter Lane. The site area is 0.28 hectares (0.71 acres).
TENURE
The property is held freehold. There is a right for the adjoining owner of the land hatched blue on the site plan to use the access road hatched green on the site plan subject to a contribution towards the maintenance and upkeep of the access road.
TENANCY
The property is let to McDonald’s Restaurants Ltd for a term of 20 years from 29 September 2012. The current rent is £90,000 per annum (£21.92 per sq.ft).
The lease is held on full repairing and insuring terms subject to five yearly upward only reviews to open market value. The next review is 29 September 2017.
CONTACTSFor further information or if you wish to arrange a viewing, please contact :-
BEN BLACKWALL0121 513 [email protected]
ANDREW FRANCK-STEIER0121 513 [email protected]
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.
Franck Steier Price Ltd
Third Floor, Victoria House
114-116 Colmore Row, Birmingham, B3 3BD
COVENANT
McDonald’s Restaurants is the most well know fast food and Drive Thru restaurant operator in the UK with over 1200 restaurants. The company is also the world’s largest chain of quick service restaurants serving over 10 million customers daily.
The company is continuing to expand and has plans to open a further 400 restaurants in the UK over the next 10 years creating over 2,400 jobs annually. The focus for this growth will be freestanding drive thru restaurants in close proximity to retail and transport hubs as per the subject property.
The company is an undoubted covenant and a summary of the company’s accounts is set out below.
EPC
The property has an EPC rating of B30. The report can be provided upon request.
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.
PROPOSAL
We are instructed to seek offers in excess of £1,550,000 (One Million Five Hundred and Fifty Thousand Pounds) subject to contract and exclusive of VAT.
A purchase at this level would reflect a net initial yield of 5.50%, assuming usual costs of purchase of 5.80%.
McDonald’s Restaurants Ltd 31/12/2013£,000s
31/12/2012£,000s
31/12/2011£,000s
Turnover 1,497,573 1,317,594 1,248,549
Pre-tax Profit 244,885 202,214 176,563
Total Assets Less Current Liabilities 828,013 690,446 530,087
The company has a Dun and Bradstreet rating of 5A1.
