GRACECHURCH STREET - Allsop

Prime City of London Mixed Use Investment Opportunity

GRACECHURCH STREET

LONDON EC3

INVESTMENT SUMMARY

81-82 Gracechurch Street is located in the core of the City of London

— Core City of London location in close proximity to Leadenhall Market and the Bank of England.

— The property occupies a prominent location on the eastern side of Gracechurch Street.

— The property is held on a 150 year Long Leasehold from The Master and Wardens of the Guild or Fraternity of the Body of Christ of the Skinners of London from 24th June 2011. The Headlease is geared to the higher of the Minimum Rent of £50,000 per annum and 10% of the Net Income.

— Grade II Listed building providing 19,418 sq ft (1,804 sq m) of office, retail and ancillary accommodation arranged over basement, ground and four upper floors.

— The property was extensively refurbished in 2012.

— The office accommodation extends to 12,493 sq ft (1,161 sq m) and is multi-let to three tenants accounting for 63.44% of the income, the passing rent is £607,823 per annum, equating to a reversionary overall rent of £48.65 per sq ft.

— The retail accommodation extends to 6,925 sq ft (643 sq m) and is multi-let to four tenants at a passing rent of £350,250 per annum equating to £50.58 per sq ft overall.

— The total gross passing rent is £958,073 per annum (including vendor top-ups), with a WAULT of approximately 6.19 years1 to lease expiries and 4.32 years to break options. Any outstanding rent-free periods will be topped up by the vendor at completion.

— The current head rent payable is £61,398.40, the total net rent equates to £896,674.60.

— Offers are sought in excess of £15,000,000, subject to contract for the Long Leasehold interest reflecting a net initial yield of 5.60%2 and a capital value of £772 per sq ft, assuming purchaser’s costs of 6.73%.

1 Weighted Average Unexpired Lease Term to expiries assumes a 5 year lease extension for Planet of the Grapes Ltd.

2 Assuming vendor top-up of any outstanding rent free at completion.

1 — 281 GRACECHURCH STREET

81-82 Gracechurch Street is located in the traditional core of the City of London, occupying a prominent position on the eastern side of Gracechurch Street.

The area continues to experience strong demand from a number of the world’s leading professional and banking services, and more recently technology and media companies. This demand is further supported by the vibrant mix of retail and leisure amenities, with Gracechurch Street being the location of choice for many leading retailers including Gap and Marks & Spencer.

The location is experiencing further significant growth and investment, with developments such as 22 Bishopsgate, 80 Fenchurch Street, 1 Leadenhall Street, and 150 Leadenhall Street amongst others due to complete over the next few years, reinforcing its position at the heart of the City of London.

LOCATION

The property is located in close proximity to the historic Leadenhall Market which dates back to the 14th Century and attracts significant footfall due to its lively and contemporary atmosphere.

Gracechurch Street is one of the City of London’s major thoroughfares linking London Bridge to Bishopsgate and is positioned close to the ‘Tower Cluster’, a collection of London’s most prominent towers including 20 Fenchurch Street (‘The Walkie Talkie’), The Leadenhall Building and 30 St Mary Axe (‘The Gherkin’).

Due to its proximity to the Bank of England and Lloyd’s of London, the sought after central location has traditionally attracted financial and insurance occupiers which today include Deutsche Bank, Rothschild & Co, Aon, AXA XL, Allianz, QBE and Willis Towers Watson.

1. Bank of England2. The Royal Exchange3. Sky Garden4. Smythson

5. Leadenhall Market6. 30 St Mary Axe

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81 GRACECHURCH STREET 3 — 4

CONNECTIVITY

Elizabeth Line (Crossrail)

81 - 82 Gracechurch Street is within a short walking distance (0.6 miles) of Liverpool Street Station which will act as the primary connection for Crossrail in the City of London.

Due for completion in Autumn 2019, the Elizabeth Line (Crossrail) will deliver a direct connection between all of London’s main employment centres, linking Heathrow with Paddington, the West End, the City and Canary Wharf. In peak times a train will run every two and a half minutes in each direction.

Two new ticket halls are being constructed at Liverpool Street and Moorgate and will be connected by underground platforms.

The railway will have an estimated 200 million travellers each year and is expected to reduce London journey times by up to 70%. The new network will support major regeneration across London and add an estimated £42bn to the UK economy.

81-82 Gracechurch Street is ideally located to benefit from London’s efficient and rapidly expanding public transport network.

The property benefits from excellent transport infrastructure, being situated in close proximity to a number of Mainline Rail and London Underground stations. These stations include:

Reading61 mins

Bond Street7 mins

Farringdon2 mins

Whitechapel2 mins

Heathrow33 mins

Slough37 mins

Paddington10 mins

Tottenham Court Road

4 mins

Liverpool Street

Stratford8 mins

Canary Wharf6 mins

Journey Times on the Elizabeth Line

Source: TfL

Bank and Monument Underground Station Upgrade

Bank Station is currently undergoing an extensive upgrade due to be completed by 2021, with a new entrance planned at King William Street, a 4 minute walk away from the property. The interlinked stations will feature several new escalators, a new station entrance and more room for Northern line passengers.

Proposals include:

— New southbound tunnel and platform for the Northern line.

— New station entrances on Cannon Street and King William Street.

— Step-free access between the Northern line, DLR and the street.

— A moving walkway for quicker and easier access.

— More lifts and escalators to ease congestion and improve accessibility.

New Bank Station Entrance (CGI)

New Liverpool Street Elizabeth Line Entrance (CGI)

Bank4 mins walk

(0.2 miles)

Liverpool St.10 mins walk

(0.6 miles)

Aldgate10 mins walk

(0.5 miles)

Mansion House10 mins walk

(0.4 miles)

Fenchurch St.7 mins walk

(0.3 miles)

Cannon St.7 mins walk

(0.3 miles)

Monument3 mins walk

(0.1 miles)

London Bridge12 mins walk

(0.8 miles)


THREADNEEDLE ST

POULTRY CORNHILL LEADENHALL ST

LIVERPOOL STLONDON WALL

LONDON WALL

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DUKE STREET HILL

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HOUNDSDITCH

QUEEN VICTORIA ST

GRESHAM STREET

LOTHBURY THROGMORTON ST

QU

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UPPER THAMES ST

LOWER THAMES ST

FENCHURCH STREETLOMBARD ST

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CANNON ST

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30ST MARY

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LEADENHALLMARKET

BOROUGHMARKET

SPITAFIELDSMARKET

20FENCHURCH

STREET

THE LEADENHALLBUILDING

GUILDHALL

MONUMENT

ST. PAUL’S

CANNONSTREET

MOORGATE

FENCHURCHSTREET

MANSIONHOUSE

LONDONBRIDGE

BANK

LIVERPOOLSTREET

LONDONBRIDGE

Creative/Tech

1. CGI Group2. The Office Group 3. Salesforce4. WeWork 5. Insightful Technology 6. Splash Creative7. Caplin Systems 8. Epiq Systems 9. Worldpay 10. Ventiv Technology

Professional

11. Accenture 12. Kennedys 13. White & Case14. British Council for Offices 15. Hunton & Williams /

Kirkland Ellis 16. Holman Fenwick Willan 17. IPS Group Ltd 18. Sidley Austin 19. Latham & Watkins 20. Meet Recruitment 21. Coventry University

Finance

22. Royal Bank of Canada 23. Standard Life 24. Financial Reporting

Council25. Lloyds Banking Group 26. Rothschild & Co 27. Schroders 28. China Construction Bank 29. Deutsche Bank 30. Blackrock 31. ING 32. Royal Bank of Scotland

Insurance

33. AXA XL 34. Allianz 35. WR Berkeley36. Prudential 37. Investec 38. Hiscox 39. AIG40. Lloyd’s Register 41. Towergate Insurance 42. Willis Towers Watson 43. Liverpool Victoria 44. Aon

DEVELOPMENT PIPELINE

81-82 Gracechurch Street is located in a thriving office location. A number of notable schemes have been developed within a 200m radius of the property, with several further large scale developments forthcoming.

The Scalpel, Lime Street, EC3

Developer WR Berkeley Corporation

Size 387,303 sq ft (35 storeys)

PC Q2 2018

Comments 53% let or under offer

Aurum, Lombard Street, EC3

Developer McKay Securities

Size 57,480 sq ft

PC Q1 2019

Comments 100% let to St James’s Place

150 Leadenhall, EC3

Developer Mitsubishi Estate Company/Stanhope

Size 568,000 sq ft

PC 2022 +

Comments Revised planning consent granted in 2017

One Undershaft, EC3

Developer Aroland Holdings/Perennial

Size 968,752 sq ft

PC 2023 +

Comments Planning consent granted

10 Fenchurch Avenue, EC3

Developer Generali/CORE/Greycoat

Size 420,000 sq ft

PC Completed 2018

Comments Majority pre-let to M&G Investments

22 Bishopsgate, EC2

Developer AXA/Temasek/PSP/QuadReal

Size 1.380M sq ft (62 storeys)

PC 2019 +

Comments c.800,000 sq ft is under offer

One Leadenhall, EC3

Developer Brookfield

Size 385,000 sq ft

PC 2023 +

Comments 100,000 sq ft under offer to Munich Re

40 Leadenhall Street, EC3

Developer TH Real Estate

Size 909,600 sq ft

PC 2022 +

Comments Under construction

80 Fenchurch, EC3

Developer Exemplar and Partners Group

Size 252,250 sq ft

PC Q1 2021

Comments Under construction

2

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8

9

6

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1

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97

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3738

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LOCAL OCCUPIERS

7 — 881 GRACECHURCH STREET

20 Fenchurch StreetTower 42 The Shard London Bridge Bloomberg HQCannon St.BankLondon Bridge1 UndershaftLiverpool St. 30 St Mary Axe 22 Bishopsgate100 Bishopsgate

Leadenhall Market Monument


THE BUILDING

81-82 Gracechurch Street was originally constructed in the 1850s, the elevation fronting Gracechurch Street is finished with Portland stone and the side façades overlooking Bulls Head Passage are finished in glazed brickwork.

The building was extensively refurbished in the mid 1980’s, and more recently modernised in 2012, with a scheme designed by Trehearne Architects, which included the replacement of all plant and machinery.

The property comprises 19,418 sq ft (1,804 sq m) of office, retail and ancillary accommodation arranged over basement, ground and four upper floors. The offices are accessed via a newly refurbished reception (2018) from Gracechurch Street with the retail units benefitting from dedicated access off Gracechurch Street and Bulls Head Passage.

SPECIFICATION

81-82 Gracechurch Street underwent a significant programme of refurbishment in 2012 to upgrade the building’s plant and machinery.

This included works to the air conditioning systems together with lift replacement.

The building benefits from the following specification:

— VRF air conditioning system;

— Metal tile suspended ceilings;

— LED lighting;

— Raised floors on the 1st and 2nd floors and trunking on the 3rd and 4th floors;

— Finished floor to ceiling heights typically ranging from 2.5 m to 2.73 m across the upper floors;

— Male and female WCs on all floors;

— Tenant shower and changing facilities on the 2nd floor;

— Refurbished manned reception;

— Passenger lift.

1. Exterior Detail2. Reception

3. EE, 81 Gracechurch Street

1. 3.

2.


The property has been independently measured by Plowman Craven in accordance with the RICS Code of Measuring Practice 6th Edition and the International Measuring Standards IPMS. The survey is assignable to a purchaser and a Duty of Care Letter can be provided.

A copy of the full measured survey and associated floor plans can be downloaded from the data room.

Floor Use sq ft (NIA) sq m (NIA)

4th Office 2,848 264.6

3rd Office 3,159 293.5

2nd Office 3,233 300.4

1st Office 3,253 302.2

Ground Retail 81 GS 977 90.8

Retail 82 GS 947 88.0

Retail 1 BHP 191 17.7

Retail 9-10 BHP 546 50.7

Basement Retail 82 GS 4,264 396.1

Total 19,418 1,804.0

Basement – Retail 4,264 sq ft / 396.1 sq m 1st Floor – Office 3,253 sq ft / 302.2 sq m

3rd Floor – Office 3,159 sq ft / 293.5 sq m

2nd Floor – Office 3,233 sq ft / 300.4 sq m

4th Floor – Office 2,848 sq ft / 264.6 sq mGround Floor – Retail 2,661 sq ft / 247.2 sq m

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Office

Retail

Reception

Storage

Core

For indicative purposes only. Not to scale.

Gracechurch Street

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Retail 9-10 BHP

Reception

Retail 81 GS

Retail 1 BHP

Retail 82 GS

ACCOMMODATION


2. Reception3. 2nd Floor,

First Title Insurance

1. 2nd Floor, First Title Insurance

1.

2.

3.


Allianz House

St Gabriel Fen Church

Ward Bdy

Risin Bollard

Ship Tavern PassageLIME STREET

CULLUM STREET

XL House

Sackville House

Ward Bdy

Bulls Head Passage

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LEADENHALL

CORNHILL

PLACE

BEEHIVE PASSAGE

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Leadenhall Market

Building

Leadenhall CourtLloyd's

TENURE

The property is held on a 150 year Long Leasehold from The Master and Wardens of the Guild or Fraternity of the Body of Christ of the Skinners of London from 24th June 2011.

The Headlease is geared to the higher of the Minimum Rent and 10% of the Net Income. The geared rent is calculated annually on the 1st April of each year of the term. The current head rent payable is £61,398.40, the total net rent equates to £896,674.60.

The Minimum Rent is currently £50,000 per annum and is reviewed every 10 years to the greater of the Minimum Rent passing and 5% of the average annual Net Income over the period of five years immediately preceding the relevant review date. The next review date is the 24 June 2021.

The property is registered under title no: AGL266316.

DEMISE TENANT AREA SQ FT

SQ M

LEASE FROM

LEASE EXPIRY

RENT START

NEXT BREAK

BREAK CLAUSES

NEXT RENT REVIEW

ANNUAL RENT

RENT £psf

INSIDE / OUTSIDE ACT

COMMENTS

4th Floor, 81 Gracechurch Street FCMB UK Ltd 2,848 264.6 19/07/2018 18/07/2028 19/07/2019 19/07/2023 Tenant 19/07/2023 £132,144.00 £46.40 Outside If the Tenant does not exercise the break they are entitled to a further 9 months' rent free until 18.04.2024. The vendor will top-up any outstanding rent-free at completion.

3rd Floor, 81 Gracechurch Street Protean Investment Risks Ltd

3,159 293.5 17/09/2018 16/09/2023 - 17/09/2021 Tenant - £161,109.00 £51.00 Outside The Tenant is paying half rent of £80,554.50 until 16.11.19. If the Tenant does not exercise the break they are entitled to a further 5 months' rent free until 16.02.2022.

2nd Floor, 81 Gracechurch Street First Title Insurance Plc 3,233 300.4 17/09/2012 16/09/2022 - - - - £151,920.00 £46.99 Outside

1st Floor, 81 Gracechurch Street FCMB UK Ltd 3,253 302.2 19/07/2018 18/07/2028 19/04/2019 19/07/2023 Tenant 19/07/2023 £162,650.00 £50.00 Outside If the Tenant does not exercise the break they are entitled to a further 2 months’ rent free until 18.09.2023. The vendor will top-up any outstanding rent-free at completion.

81 Gracechurch Street - Retail EE Ltd 977 90.8 28/11/2014 27/11/2024 - - - 28/11/2019 £113,000.00 £115.66 Inside

82 Gracechurch Street - Retail Robert Dyas Property Ltd

5,211 484.1 25/03/2010 24/03/2020 - - - - £159,750.00 £30.66 Inside

1 Bulls Head Passage - Retail Zdenka Trutzova 191 17.7 28/02/2012 27/02/2022 - - - - £20,000.00 £104.71 Inside

9 & 10 Bulls Head Passage - Retail Planet of the Grapes Ltd 546 50.7 19/10/2017 04/04/2031 - - - 19/10/2022 £57,500.00 £105.31 Outside As part of the 2017 rent review, the rent has fixed incremental increases over the next 5 years as follows - Year 1 - £53,500 p.a, Year 2 - £54,500 p.a, Year 3 - £55,500 p.a, Year 4 - £56,500 p.a & Year 5 - £57,500 p.a. The vendor will top-up any outstanding rent-free at completion. A lease extension for a further 5 years until April 2031 has been agreed with the tenant.

Total Gross Rent 19,418 1,804.0 £958,073.00 * £49.34

Current Head Rent Payable £61,398.40

TOTAL NET RENT £896,674.60

N

*Total rent is inclusive of vendor rental top-up.

TENANCY SCHEDULE


The covenant information for the five tenants which account for the highest percentage of income at 81-82 Gracechurch Street is set out below.

FCMB Bank (UK) Limited 30.77% of Rent Passing

FCMB Bank (UK) Limited is an independently incorporated, wholly-owned subsidiary of First City Monument Bank Ltd (FCMB), a member of the FCMB Group PLC, a leading financial services group based in Nigeria, listed on the Nigerian Stock Exchange.

At December 2017, FCMB had 3.7 million customers and 204 branches in Nigeria and a wholly owned subsidiary in the UK.

In the year ended 31 December 2017, FCMB Bank (UK) Limited reported a profit of $1.12m.

The company has a D&B rating of 4A1.

Further information can be found at www.fcmb.com

Protean Investment Risks Ltd 16.82% of Rent Passing

Protean Investment Risks Ltd is a Registered Lloyd’s Broker, regulated by the Financial Conduct Authority specialising in the investment industry, financial services and technology sectors.

The company has a D&B rating of F2.

Further information can be found at www.proteanrisk.com

Robert Dyas Property Ltd 16.67% of Rent Passing

Robert Dyas is a UK hardware retailer founded in London in 1872 with 95 stores spread across the South of England.

Since 2012, Robert Dyas has been owned by Theo Paphitis, the entrepreneur and long-time star of BBC’s Dragons’ Den.

In the year ended 31 April 2017, Robert Dyas reported an increase in turnover to £123.4m.


Further information can be found at www.robertdyas.co.uk

First Title Insurance Plc 15.86% of Rent Passing

First Title Insurance Plc is a UK regulated specialist insurance company, dedicated to helping property owners, developers and lenders protect investment and maximise returns.

In the year ended 31 December 2017, First Title reported a statutory accounts profit after tax of £2.1m.


Further information can be found at www.firsttitle.eu

EE Ltd 11.79% of Rent Passing

EE, part of the BT Group is the largest and most advanced digital communication company in Britain, delivering mobile and fixed communications services.

EE has approximately 553 retail stores and services more than 31 million connections across its mobile, fixed and wholesale networks.

Under the umbrella of the BT Group, the company has reported a turnover of £23.7bn in 2018 and a profit of £2.6bn before tax.


Further information can be found at www.btplc.com

TENANT COVENANT

1. Robert Dyas, 82 Gracechurch Street2. Planet of the Grapes,

9 & 10 Bulls Head Passage3. First Title Insurance, 2nd Floor,

81 Gracechurch Street

1. 2.

3.


Term 150 years from 24 June 2011, expiring 23rd June 2161.

LandlordThe Master and Wardens of the Guild or Fraternity of the Body of Christ of the Skinners of London.

PremisesAll those premises known as 80, 81 and 82 Gracechurch and 1, 9, 10, 11 and 12 Bulls Head Passage.

UserNot without the consent in writing of the Landlord, such consent not to be unreasonably withheld, to use the premises otherwise than as office, retail, restaurant or bar, or any combination of those uses, and for storage or ancillary use.

Not to use the premises for residential purposes.

Rent CalculationThe annual rent payable during each accounting period (yearly calculated on the 1st April) will be an amount equal to the greater of:

a) The Minimum Rent; andb) 10% of the Net Income (as defined).

The Net Income includes rents received on let accommodation and deemed notional rent payable on vacant accommodation.

The current head rent payable is £61,398.40, the total net rent equates to £896,674.60.

Minimum Ground Rent £50,000 per annum until the first review date.

Minimum Ground Rent ReviewThe minimum ground rent is to be reviewed every 10 years to the greater of the Minimum Rent passing and 5% of the average annual Net Income (as defined) over the period of five years immediately preceding the relevant review date.

The next review date is 24 June 2021.

Alienation a) Not to assign the whole of the premises without

the prior written consent of the Landlord, not to be unreasonably withheld or delayed.

b) Not to underlet the whole or any part of the premises other than in compliance with part 2, schedule 5 of the Headlease.

c) Not to underlet at anything other than the best terms reasonably obtainable in the open market.

RepairFull repairing terms.

Alterations 1. The Tenant shall not carry out any structural alterations

to the premises by which the extent of the Net Internal Area will be more than 5% less than the NIA as expressed in the Certificate of Practical Completion.

2. The Tenant shall not carry out any other alterations to the premises without the prior consent of the Landlord (not to be unreasonably withheld or delayed) save that the Tenant may carry out alterations without consent which:

a) Do not affect the exterior of the premises or the building;

b) Do not affect the structural integrity of the building;c) Non-structural alterations including the erection

and removal of demountable partitioning.

Insurance The Tenant is obliged to keep the premises insured in the joint names of the Landlord and the Tenant.

HEADLEASE SUMMARY

1. Building Exterior

1.


FURTHER INFORMATION

Planning

The property is situated in the City of London.

The property is Grade II listed under list entry number 1064670 and lies within the Leadenhall Market Conservation Area.

VAT

The property is not elected for the purposes of VAT.

EPC

81 Gracechurch Street has an EPC rating of B (49).

A copy of the certificate can be downloaded from the data room.

Data Room

Further information can be downloaded from the data room at www.81-82gracechurchstreet.com

Proposal

Offers are sought in excess of £15,000,000, subject to contract for the Long Leasehold interest reflecting a net initial yield of 5.60%* and a capital value of £772 per sq ft assuming purchaser’s costs of 6.73%.

CONTACT

For further information or to arrange an inspection please contact:

James Abrahams [email protected] 020 7588 4433

Jonathan [email protected] 7588 4433

Matt [email protected] 7588 4433

Marsha [email protected] 7588 4433

Allsop LLP on its behalf and for the Vendors or Lessors of this property, whose Agents they are, give notice that: These particulars are set out as a general outline only for guidance to intending Purchasers or Lessees, and do not constitute any part of an offer or contract. Details are given without any responsibility and any intending Purchasers, Lessees or Third Parties should not rely on them as statements or representations of fact, but must satisfy themselves by inspection or otherwise as to the correctness of each of them. No person in the employment of Allsop LLP has any authority to make any representation or warranty whatsoever in relation to this property. Unless otherwise stated, all prices and rents are quoted exclusive of VAT. November 2018.

Designed and produced by Cre8te – 020 3468 5760 – cre8te.london

*Assuming vendor top-up of any outstanding rent free at completion.

Documents

GRACECHURCH STREET - Allsop