PRODUCTION & DISTRIBUTION UNIT WITH ADDITIONAL DEVELOPMENT LAND

Wrap Film Systems, Hortonwood 45Telford TF1 7FA

LOCATIONTelford is located 34 miles north west of Birmingham and 17 miles north west of Wolverhampton. The town is served by the M54 which links to the M6 at Junction 10a, 17 miles to the east. The A5 runs east-west through the town.

Hortonwood Industrial Estate is one of Telford’s premier industrial locations, located at the intersection of the A442 and A518, 3 miles north of the town centre and a similar distance from Junctions 4 & 5 of the M54. Occupiers on Hortonwood include BAE Systems, Makita, Denso Manufacturing, Nestle and Heinz. Situated adjacent to Hortonwood is the 45 acre Telford International Railfreight Park which is the first rail terminal to the west of the central Midlands area and is operated by Schenker.

To the north of Wolverhampton, alongside the M54, Jaguar Land Rover are in the process of building a 750,000 sqft advanced engine facility at i54. The 226 acre strategic development site, once complete will comprise approximately 2.5 million sqft of commercial development. This will have a significant boost to the regional economy and Telford industrial market. i54 is marked on the location plan.

INVESTMENT SUMMARY• Modern industrial unit with additional 8 acres of development land.

• Established industrial estate location.

• Let to Wrap Film Systems Ltd on a lease expiring on 21 July 2021 - 9 years unexpired.

• Passing rent of £435,000 per annum.

• £4,700,000 - 8.75% for the investment element. • £1,000,000 for the additional expansion/development land.

• Consideration will be given to the sale of both elements either as a single lot or separately.

DESCRIPTIONThe property is a modern production/distribution unit originally built in 1995 for Makita and is now Wrap Film’s UK headquarters and manufacturing facility. The unit has a steel frame and panel clad elevations, the steel roof has a plastic panel covering. Internally the unit has a clear working height of 5.60m. The industrial accommodation has sodium lighting and is fully heated and sprinklered. Loading from the 6 dock levellers is from the rear service yard. To the front of the unit are single storey offices and a canteen.

There is a car park for approximately 156 cars accessed directly from Hortonwood 45 (Car Park A) and a separate entrance to the service yard to the rear of the unit controlled by a gatehouse and barrier. Part of the larger car park is outside the tenant’s demise and would form part of future development land. There is also a grassed area to the southern elevation of the industrial unit (marked as Car Park B) which runs along Hortonwood 45 this has been highlighted in the lease for a possible car park relocation. Further information and explanation is in the occupational lease.

DEVELOPMENT LANDTo the north of the existing building are 8 acres of developable expansion land which is accessed from the existing entrance to the car park. This land has planning permission for industrial development and could provide longer term expansion for Wrap Film. There is little large scale industrial development land at Hortonwood, with any other large sites having been taken by owner occupiers or existing companies for expansion.

ACCOMODATIONThe property has been measured on a gross internal area basis and provides the following floor areas:

Sq. m Sq. ft

Production/Distribution 10,019.14 107,846Works Offices 447.32 4,815Offices & Canteen 1079.25 11,617TOTAL 11,545.71 124,278

The overall site is 9.33 hectares (23.17 acres). The development land provides 3.22 hectares (8.00 acres) which is outside the tenant’s demise.

DEVELOPMENT LAND

CAR PARK B CARPARK

A

VATThe property is elected for VAT and therefore VAT will be payable on the purchase. The intention would be to sell as a TOGC.

PRICINGWe are instructed to seek offers in excess of £4,700,000 for the investment element which provides an initial yield of 8.75% allowing for normal purchaser’s costs of 5.8%.We are instructed to seek offers in excess of £1,000,000 for the 8 acres of development land.

Consideration will be given to the sale of both elements either as a single lot or separately.

TENUREFreehold.

TENANCYThe property was originally let to Wrap Film Systems Ltd on FRI terms (subject to a Schedule of Condition) for a term of 15 years from 21 February 2005. The current rent passing is £435,000 per annum. There is an agreement in place that has extended the expiry of the lease to 21 July 2021. By way of a Deed of Variation the next rent review has been amended to 22 July 2016. At review if the passing rent increases by over 5%, the tenant is granted 6 months rent free, if a sub 5% increase is secured then the tenant is granted 3 months rent free. There is a cap on the reviewed rent at £478,500 per annum.

The landlord has the ability to move the tenant’s car park to a designated area along the Hortonwood 45 boundary.

MARKET COMMENTARYWrap Film occupy a distribution unit on the opposite side of Hortonwood 45. The unit extends to 68,143 sqft and also let until July 2021. This investment sold in December 2011 for £1,710,000 reflecting an initial yield of 6.91% rising to 8.84% in July 2013.

There has been several large scale deals at Hortonwood and elsewhere in Telford over the past 18 months. Over 700,000 sqft has either been bought, let or constructed for expansion. Stadco moved into 300,000 sqft, Simmons took 100,000 sqft at Stafford Park and Faccenda and Makita have recently extended their facilities each by 70,000 sqft on Hortonwood. There is now a lack of comparable large units available in Telford at the current time and little sizeable undeveloped plots of land.

COVENANTWrap Film Systems Ltd – the company is Europe’s leading supplier of branded and private label aluminium foil and cling film products. Established in 1975, the company supplies food wrapping systems for the fast food, catering and retail market and are behind the catering brands Wrapmaster and Caterwrap as well as the Baco and Bacofoil retail brands. The company is owned by private equity firm Growth Capital Partners, who backed the management buy out in 2007. Bacofoil was purchased in 2009 from US based Reynolds Consumer Products.

Hortonwood 45 is the company’s British manufacturing base, they have over 250 employees based in Telford and export to over 33 countries worldwide.

The company has seen A summary of the company’s accounts are set out below:Dec 2010 (£’000’s)

Dec 2009 (£’000’s)

Dec 2008 (£’000’s)

Turnover £46,815 £36,191 £32,491

Pre-tax profit £3,816 £2,926 £2,244

Shareholders’ Funds £10,320 £7,003 £4,309

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.

EPC

CONTACT For further information or to arrange a viewing please contact:

Andrew PriceFranck-Steier PriceDD: 0121 513 0892M: 07798 656 360andrew.price@fspproperty.co.uk

Andrew DixonAndrew Dixon & CoDD: 01952 521 000M: 07957 828 565andrew@andrew-dixon.co.uk