Upload
squeeze-design
View
230
Download
2
Tags:
Embed Size (px)
DESCRIPTION
Strood Retail Park | Strood P r i m e O P e n A 1 r e t A i l P A r k i n v e s t m e n t 19 Proposal 06 Location 15 Covenant Information 16 Planning 19 Environmental Considerations 19 Estimated Rental Values 08 Socio-Ecomonic Profile 10 Surrounding Retail Warehouse Provision 12 Description 09 Situation strood retail Park Strood Page 02 strood retail Park Strood Page 03
Citation preview
P r i m e O P e n A 1 r e t A i l P A r k i n v e s t m e n t
Strood Retail Park | Strood
strood retail ParkStrood
strood Retail Park
04 Investment Summary
06 Location
08 Socio-Ecomonic Profile
09 Situation
10 Surrounding Retail Warehouse Provision
12 Description
13 Tenure
14 Tenancies
15 Covenant Information
16 Planning
18 Asset Management Opportunities
19 Environmental Considerations
19 Estimated Rental Values
19 Proposal
Strood Retail Park provides a well secured income stream offering a low base for rental growth and asset management opportunities to drive value in the short and medium term.
Page 02
strood retail ParkStrood
Page 03
investment Summary
n strood is an established commercial centre in the medway area of kent, situated just to the west of the river medway, close to rochester and Chatham.
n the area currently offers excellent infrastructure and in addition there is significant regeneration underway across the medway area, including the development of over 2,000 homes and around 15,000 sq m (161,500 sq ft) of commercial floorspace.
n the subject property provides the only purpose built retail warehouse offer in the town, complimented by the presence of it’s two main foodstores and the town centre in very close proximity.
n the park has an Open A1 (part food) retail consent and provides well configured, flexible retail space which undoubtedly offer asset management opportunities moving forward, in the form of downsizing and tenant re-orientation.
n the park was developed in 1990 and is currently let to 5 tenants, including B&Q, next, Argos and Brantano.
Initial Yield : 4.64% June 2008 : 5.05% December 2008 : 5.55% Equivalent Yield : 5.60% True Equivalent Yield : 5.80% Reversionary Yield : 5.63%
strood retail ParkStrood
Page 04
n Agreements for lease have been signed with matalan and Carphone Warehouse for space in the new block, opposite the main terrace. the average unexpired lease term will stand in the order of 10.5 years, following the completion of these leases.
n Passing rents range between £15.25 psf and £22.50 psf offering a low base for good rental growth and we strongly believe that rental levels can be driven forward through the asset management initiatives.
n We are instructed to seek offers in the region of £40,000,000, subject to contract and exclusive of vAt, for the Freehold interest in this property. A purchase at this level would show the following yield profile, based on our estimate of rental value and costs of 5.7625%.
strood retail ParkStrood
Page 05
The subject property provides the only purpose built retail warehouse offer in the town, complimented by the presence of it’s two main foodstores and the town centre in very close proximity.
A414
A1
A40
A4
A3
A23
A24
A21
A20
A406
A205
A217
A205
A13
A2
A2
A282
A309
A406 A13
A12
A130
A414
A249
A2
A127
A138
A12
A127
A10
A249
A21
A22
A25
A232
M25
M2
M25
M25
M25
M25
M10
M11
M25
M25
M26
M20
M2
M11
A414
A13
A13
M20
A229
CanveyIsland
Southend-on-sea
GillinghamRochester
Strood
Sittingbourne
Maidstone
RoyalTunbridge
Wells
Basildon
RedhillDorking
Watford
Potters Bar
Harlow
Dartford
Swanley
NewAddington
Sevenoaks
Tonbridge
London
location
strood is located in the medway area of kent approximately 48 km
(30 miles) south-east of Central london. Other nearby centres include
rochester and Chatham approximately 0.8 km (0.5 mile) across the
river medway to the east, maidstone 16 km (10 miles) to the south
and Dartford 22.5 km (14 miles) to the west.
The area has excellent infrastructure and further regeneration across the
Medway is well underway. The 140 hectares (354 acres) of Chatham
Maritime is now a well established residential and business location and
there are popular tourist attractions at Chatham Historic Dockyard, the newly
opened £60m Dickens World and Rochester Castle and Cathedral.
As part of the Thames Gateway initiative, Medway is in line to receive over £1bn
of investment over the next 20 years and the new developments which we have
referred to, should provide around 16,000 new homes and create 40,000 jobs,
on approximately 900 hectares (2,223 acres) of Brownfield Land.
Strood benefits from good road communications with Junction 1 of the M2,
and the A2, situated only 3 km (1.8 miles) to the west offering access to
Gravesend, Dartford and Central London. Furthermore Junction 2 of the M2
and the A228, situated only 3 km (1.8 miles) to the south connect with the
M20, Maidstone and Ashford in the south-east. The A2 also offers a direct
link east to Sittingbourne, Canterbury and Dover.
Strood railway station offers a direct service to London Charing Cross and
London Cannon Street with an approximate journey time of 1 hour 5 minutes
and rail services from nearby Rochester provide regular connections to
Central London with a fastest journey time of 42 minutes.
strood retail ParkStrood
Page 06
strOODretail Park
strood retail ParkStrood
Further key developments in the area include:
Strood Riverside
A mixed-use waterfront development to
provide around 500 – 600 new homes.
Temple Waterfront
A 70 hectare (172 acre) site with
development brief for around 600 new
homes and 15,000 sq m (161,500 sq ft)
of commercial floor space.
rochester riverside
A 28.3 hectare (70 acre) site for a new mixed
use development including approximately
2,000 homes. These initiatives should create
in the region of 900 hundred jobs.
Page 07
WATLING STREET LONDON ROAD
GR
AVESEND
ROAD
CUXTO
N ROAD
C
UXTO
N ROAD
GUN LA
NE
STAT
ION
ROAD
PRI
ORY
RO
AD
HIGH STREET CORPORATION STREET
MAID
STO
NE R
OA
D
M2
A2
A2A228
A228
A228
2000 ft
500 m
temPleWaterfront
strOODriverside
rOChesterriverside
strOODretail Park
Upper Stoke
St Mary Hoo
Luddersdown
Wouldham
Cobham
Hoddsoll Street
Stockbury
M26
M2
M2
M20M20
Gillingham
Chatham
Rochester
Gravesend
Ditton
Tilbury
strood retail ParkStrood
socio-economic Profile
According to CACi approximately 140,295 people live within a
10 minute drive time of the subject property and this catchment
increases to around 324,625 people within a 15 minute drive time.
The 2001 Census indicates that the area boasts above average figures in
relation to car and property ownership. We have set out these statistics in
the table below:
Cars or vans in household strood Uk
1 car or van 46.4 43.8
2 cars or vans 24.6 23.1
Owner occupied property 76.7 68.3
10 minute drive time
15 minute drive time
The area currently offers an excellent infrastructure whilst there is further regeneration underway, and proposed, across the Medway area.
Page 08
strOODretail Park
HIGH STREET CORPORATION STREET
STATIO
N RO
AD
CO
M
MERCIAL ROAD
PRI
ORY
ROAD
CUXTON R
OAD
CUXT
ON R
OAD
G
UN LANE
GRAVESEND
ROAD
WATLING STREET LONDON ROAD
A2
A2A228
A228
M2
A228
situation
strood retail Park is positioned just to the south of Commercial
road (A2) which forms part of the main town centre ring road, and
in close proximity to the in-town retail offer which comprises such
occupiers as Woolworths, Boots and sports World as well a variety
of local traders. the scheme benefits from excellent frontage to
Commercial road (A2), which provides direct links both east and
west from the town centre. there is also additional frontage to
knight road, which forms the site’s western boundary and links
with the A228, which runs south to the m2.
Immediately to the south of the park is a new 7,060 sq m (76,000 sq ft)
Morrisons foodstore, which opened in October 2006, whilst there is a
3,995 sq m (43,000 sq ft) Tesco foodstore situated around 500 metres
(0.3 miles) to the west on Cuxton Road. We understand that Morrisons
reported the best ever opening week sales performance, of any of their
stores, when this opened in 2006. These two stores combine to provide
the dominant food offers in Strood and the combination of these,
the subject property and the town centre, means the location has a
well-rounded retail offer and significant critical mass.
strood retail ParkStrood
Page 09
2000 ft
500 m
strOODretail Park
NELSON ROAD
DOCK
ROA
D
MEDWAY ROAD
PIER ROAD
YOKO
SUKA W
AY
CUXT
ON R
OAD
HIGH STREET
MAI
DS
TON
E R
OA
D
RAINHAM ROAD WATLING STREET
HO
ATH W
AY
CIT
Y W
AY
M2
Gillingham
Chatham
Strood
Surrounding retail Warehouse Provision
strood retail Park provides the only out of town retail offer in strood.
the town has the 14,306 sq m (154,000 sq ft) medway valley leisure Park,
which is owned by PrUPim and incorporates tenants including Cineworld,
esporta, Frankie & Bennys, Gala Bingo and mcDonalds.
We consider that Gillingham, situated approximately 7 km (4.3 miles) to the east,
and Chatham, situated approximately 0.8 km (0.5 miles) to the south, provide the
only competing out of town retail offer to the subject property.
The map adjacent identifies the locations of the respective schemes
and we have provided brief details of the size, tenants etc.
• Gillingham – Watling street
Circa 9,290 sq m (100,000 sq ft) B&Q Warehouse.
• Gillingham – Gillingham retail Park, Ambley road
Circa 3,251 sq m (35,000 sq ft) of bulky space
comprising MFI, Allied Carpets and Magnet.
• Chatham – maidstone road
Circa 12,910 sq m (137,000 sq ft) park incorporating
such tenants as Currys, PC World, Carpetright, Toys R Us and Homebase.
• Chatham – new Cut
Circa 2,471 sq m (26,630 sq ft) Wickes DIY store.
strood retail ParkStrood
2000 ft
1 km
Page 10
mAiDstOne rOADChatham
GillinGhAm retAil PArkGillingham
WAtlinG streetGillingham
neW CUtChatham
strOODretail Park
strood retail ParkStrood
Page 11
UNIT 1A
the property currently comprises five units in a linear terrace
positioned to the eastern side of the site. the smaller western
terrace is now being redeveloped to provide three units.
At present there are approximately 312 car parking spaces, arranged
in a forecourt car parking area between the existing and proposed
new terrace, giving a ratio in the order of 1:21.9 sq m (235 sq ft).
Customer access to the park is via a slip road from the A2, with a
second principal access/egress from Knight Road, off Commercial Road,
shared with the nearby Civic Centre. Segregated rear servicing is also
accessed from Knight Road, with this servicing route and the adjacent
railway line effectively forming the southern and eastern boundaries of
the site respectively.
The existing units comprise steel portal frame construction, with part
brick/profiled metal clad elevations and profiled metal sheet roofs.
Description
strood retail ParkStrood
The park was developed in 1990 and is currently let to 5 tenants, including B&Q, Next, Argos and Brantano with agreements signed with Matalan and Carphone Warehouse.
Page 12
Elevation caption here
COMMERCIAL ROAD
KNIG
HT
ROAD
strood retail ParkStrood
Page 13
tenurethe property is held Freehold.
Freehold demise
UNIT 1A
This plan is published for convenience of identification only and although believed to be correct, its accuracy is not gauranteed and does not form part of any contract.
tenancies
Unit tenant term lease lease next GiA Current Current erv erv Comments start expiry review sq ft rent rent £ pa £ psf £ pa £ psf
A B&Q Plc 25 22/12/88 21/12/13 22/12/08 36,861 £562,130 £15.25 £663,498 £18.00 t /a B&Q
B1 Next Group Plc 15 28/02/05 27/02/20 28/02/10 7,693 £173,093 £22.50 £207,711 £27.00 t /a Next
B2 Argos Ltd 15 10/11/03 09/11/18 10/11/08 10,286 £168,300 £16.36 £277,722 £27.00 t /a Argos
B3 Brantano (UK) Ltd 15 24/06/03 23/06/18 24/06/08 6,169 £102,000 £16.53 £171,190 £27.75 t /a Brantano
D Carpetright Plc 15 24/06/03 23/06/18 24/06/08 9,514 £156,200 £16.42 £256,878 £27.00 t /a Carpetright
2A To be let – TBC TBC TBC 8,730** £235,710 £27.00 £235,710 £27.00 Vendor will provide a two year rental gaurantee.
2B Matalan Retail Ltd* 15 TBC TBC TBC 21,500** £473,000* £22.00 £473,000 £22.00 Income will be confirmed t /a Matalan following PC
2C The Carphone Warehouse Ltd 10 TBC TBC TBC 3,050** £88,450* £29.00 £88,450 £29.00 Income will be confirmed t /a Carphone Warehouse following PC
Van Mr JW Smith 3 22/04/05 21/04/08 n/a n/a £7,500 n/a £7,500 n/a
totals 73,573 £1,966,383 £2,381,659
* The vendor will top-up this income until the unit becomes income producing ** To be confirmed following development of space
The property is currently let to 6 tenants, with two further Agreements for Lease in place, in accordance with the Tenancy Schedule adjacent.
strood retail ParkStrood
Page 14
We have set out adjacent Dun & Bradstreet ratings for the primary tenants, which account for the majority of the income:
strood retail ParkStrood
Page 15
tenant D&B rating % of income
B&Q 5A1 32.5%
Next 5A1 10.0%
Argos 5A1 9.7%
Brantano 5A1 5.9%
Carpetright 4A1 9.0%
Matalan 5A1 27.3%
Carphone Warehouse 5A1 5.1%
99.5%
These figures are based on income following completion of the new lease – virtually all income is 5A1 rated.
The average unexpired term of the primary income will stand in the order of 10.5 years, following completion of these leases.
Covenant Information
Planning
Planning Permission was granted on the 6th December 1989
by rochester Upon medway City Council, for the ‘demolition of
existing buildings and erection of non-food retail warehouse and
ancillary works, including parking area for customer’s use.
Conditions included, stated that:
‘The building shall be used as a non-food retail warehouse and for no
other purpose (including any other purposes in Class A1 of the Schedule
to the Town and Country Planning (Use Classes) Order 1987.’
Following significant Fire damage to the stand-alone Matalan unit (A),
Planning Permission was granted by Medway Council for the
‘Construction of a block of three retail units with associated parking spaces.’
Copies of these documents are available on request.
strood retail ParkStrood
The park has an open A1 non food planning consent offering excellent flexibility moving forwards.
Page 16
strood retail ParkStrood
Page 17
Asset management Opportunities
strood retail ParkStrood
We consider that there are a number of asset management opportunities
available to drive future performance:
• The letting of the 811 sq m (8,730 sq ft) to set an improved tone of rents across the scheme.
• Pursue a surrender of Carpetright and re-let to another ‘open’ retailer such as
New Look, Sportsworld, Boots, Mothercare etc.
• In the short to medium term a downsize and carve up of the B&Q unit (lease expiry
21.12.2013). B&Q have another warehouse format in Gillingham and would most
likely consider reducing their exposure in the area. The creation of smaller units would
offer the opportunity to lift rental levels and improve tenant mix further, exploiting the
open A1 consent. There is also the potential of developing residential space above.
• Exploit the existing food consent to introduce a food offer into the scheme.
This would unquestionably improve the tenant mix and offer on the park.
• Given the close proximity of the scheme to the town centre, there may well be
an opportunity to introduce car parking charges and therefore benefit from
another income stream.
• Advertising signage on Priory Road and Commercial Road to be investigated.
environmental Considerations
WsP environmental undertook a review of various documents relating to the environmental condition of
the subject property, and concluded as follows:
It is our opinion, subject to further recommendations below, that the site represents a low risk of environmental liability
for the freehold owner.
A full copy of the report, together with the recommendations referred to above, is available on request.
now that the new terrace is being reconstructed, negotiations can be pursued seriously in respect of the
remaining 811 sq m (8,730 sq ft) of ‘new space’ (the rest being let to matalan & Carphone Warehouse).
Based on the indications of interest received to date, we consider an achievable level of rent on this space
stands in the order of £27.00 psf. Further information is available on request.
We have based our views of estaimated rental value on £27.00 psf for a unit of 7,500 – 10,000 sq ft,
and have set these out in the Tenancy Schedule on page 14.
estimated Rental Values
Page 18
Asset management Opportunities Proposal
strood retail ParkStrood
Page 19
We are instructed to seek offers in the region of £40,000,000, subject to contract and exclusive of vAt, for the Freehold interest in this property. A purchase at this level would show the following yield profile, based on our estimate of rental value and costs of 5.7625%.
Initial Yield : 4.64% June 2008 : 5.05% December 2008 : 5.55% Equivalent Yield : 5.60% True Equivalent Yield : 5.80% Reversionary Yield : 5.63%
We strongly believe that rental values can be driven forward through asset management initiatives.
UNIT 1A
UnDer OFFer
Patrick knapmanT: 020 7152 5019F: 020 7152 5381E: [email protected]
Justin houlihanT: 020 7152 5670F: 020 7152 5381E: [email protected]
ContactsFor more information please contact:
www.cushmanwakefield.com
Strood | Strood Retail Park | January 08 | Ref: 104544
misrepresentation Act 1967 and Property misdesrciptions Act Cushman & Wakefield for themselves and for vendors or lessors of this property whose agents they are, give notice that :
1 The particulars are produced in good faith, are set out as a general guide only and do not constitute any part of a contract.
2 No person in the employment of the agent(s) has any authority to make or give any representation or warranty whatever in relation to this property.
3 This property is offered subject to contract and, Floor areas, measurements or distances given are approximate and unless otherwise stated, all rents are quoted exclusive of VAT.
4 Nothing in these particulars should be deemed to be a statement that the property is in good condition or that any services or facilities are in working order.
5 Unless otherwise stated, no investigations have been made regarding pollution or potential land, air or water contamination. Interested parties are advised to carry out their own investigations if required.
6 Any plans are published for convenience of identification. Any site boundaries shown are indicative only and should be checked against Title Deeds. The plans are based upon Ordnance Survey Map with the permission of the Controller of H. M. Stationery Office Crown Copyright, Cushman & Wakefield Licence No. ES753998.
Printed on 55% recycled paper