FOR SALE Highly reversionary waterside office investment with alternative use potential

FOR SALE Highly reversionary waterside office investment with alternative use potential

INVESTMENT SUMMARY Modern multi let office totalling 16,801 sq ft on Teesdale Business Park, widely regarded as the prime office location for Tees Valley. WAULT of 5.84 years to Expiry (2.40 to Break) providing excellent asset management potential through lease restructuring. 66.5% of the passing rent secured to The British Library Board, a government backed tenant until 2024. Annual rent of 60,012 reverting to 114,215 upon letting vacant space, assuming a modest ERV of 7.50 psf. Significant alternative use potential. Freehold. Offers are sought in excess of 625,000 reflecting an attractive NIY of 9.13% and a reversionary yield of 17.38% upon letting the vacant accommodation and assuming standard purchasers costs of 5.12%. A purchase at this price reflects a low capital value of just 37.20 psf.

MORPETH A1(M) RICHARD HOUSE LOCATION Stockton-on-Tees is a regional centre situated in Teesside in the North-East of England, approximately 10 miles south-west of Hartlepool and 2 miles west of Middlesbrough. The town has a district population of 191,000 (2011 census). The and A66 dual carriageways link the town with the A1(M), junctions 57, 58 and 59 of which are all situated approximately 12 miles to the west. The also gives direct access to Sunderland and Newcastle Upon Tyne to the north and York to the south. Scotland Glasgow Edinburgh Wales Carlisle Leeds Manchester Liverpool Birmingham Cardiff Bristol Newcastle Sunderland Middlesbrough Nottingham England London A68 HEXHAM A66 A68 A689 A696 A69 A688 A66 Newcastle Airport NEWCASTLE UPON TYNE GATESHEAD CHESTER-LE-STREET A690 SCOTCH CORNER DURHAM A688 65 A1(M) 63 62 61 60 A68 59 STOCKTON 58 DARLINGTON A66 57 56 A1(M) A167 A690 TYNEMOUTH Port of Tyne SOUTH SHIELDS A181 Durham Tees Valley Airport SUNDERLAND SEAHAM A689 HARTLEPOOL Teesport MIDDLESBROUGH A171 Local train services connect at Darlington with the main East Coast Inter City routes, connecting to London Kings Cross (2 hours 40 minutes) and Edinburgh. Daily scheduled flights operate to various UK and European destinations from both Teesside Airport (5 miles to the west) and Newcastle International Airport. The town is developing a diversified economy, with strong growth in the service sector in recent years. However, manufacturing is still important to the town with a greater than average proportion of the population employed within this sector. A1027 A177 A1305 STOCKTON-ON-TEES A139 A1046 Crofton Rd North Marston Rd A1046 Teesway A1046 Haverton Hill Rd Tees Bridge Approach Rd A1032 B6541 Heywood St B6541 A66 A178 Newport Rd Hartington Rd North Rd Middlesbrough MIDDLESBROUGH Borough Rd Teesside University A66 B1272 A1 10 miles A1305 RICHARD HOUSE A135 A1130 River Tees Princeton Dr Thornaby Queen s Campus A66 B6541 Teesside Shopping Park Stockton Rd South B1032 B1032 West Lane Hospital Albert Park A172

SITUATION HARRIET HOUSE The Teesdale Business Park is an established in town business park located to the south of Stockton bounded by the River Tees. The park is well connected to Stockton Town Centre approximately 400 m to the east via the Millennium Bridge. Construction began in the late 90 s to accommodate the shortage of high quality office accommodation in Teesside, the park now extends to circa 700,000 sq ft of accommodation attracting notable occupiers such as Durham University, Barclays Bank, the NHS and HMRC. Richard House is located to the west of the business park, accessed off Sorbonne Close, via Yale Crescent. The property occupies a prominent waterside position bounded by the River Tees to the west and canals to the north. In addition to Stockton Town centre a short walk to the east, local park amenities are in close proximity including Sainsbury s Local and Nunthorpe Day Nursery, whilst Thornaby Station and local bus routes are within a two minute walk. RICHARD HOUSE HELLEN HOUSE Richard House Excluded from the ownership Indicative Title Boundary

John Snow College Queens Campus Millennium Bridge Infinity Bridge

DESCRIPTION Richard House extends to 1,560 sq m (16,801 sq ft) of office accommodation constructed of brick block walls under a pitched tiled roof. The accommodation is spread over five floors accessed via an eight person passenger lift or central staircase. Internally, the suites benefit from suspended ceilings, comfort cooling, gas central heating, category 2 lighting, male and female WC s on each floor. Externally, the building occupies a prominent waterside corner location adjacent to two apartment blocks, Helen and Harriet House, which share an extensive 136 space car park with the subject property. SERVICE CHARGE The service charge comprises three schedules and the current budget is 43,100 per annum ( 2.56 psf). Building insurance is currently 1,881.41 per annum ( 0.11 psf). The adjoining properties, Helen and Harriet House are obliged to contribute 80% towards the upkeep of the car park, which is in addition to the above budget figure. The void service charge and insurance obligations are currently 17,195 per annum.

ACCOMMODATION The property briefly comprises the following NIA: AREA FLOOR SQ M SQ FT Ground (1) 219.81 2,366 Ground (2) 108.32 1,166 1st 344.39 3,707 2nd 337.05 3,628 3rd 343.27 3,695 4th 208.01 2,239 TOTAL 1560.85 16,801 TENURE The property is held freehold.

TENANCY The building is let in accordance with the tenancy schedule as set out below; FLOOR TENANT SQ M AREA SQ FT START EXPIRY TERM RENT REVIEW (BREAK) RENT COMMENTS Ground (1) Vacant 219.81 2,366 2,366 Ground (2) Vacant 108.32 1,166 1st 2nd The British Library Board Advanced Personnel Management Group (UK) Limited 344.39 3,707 08.11.2014 08.11.2024 10 08.09.2019 (08.09.2019) 337.05 3,628 03.11.2011 02.11.2016 5 20,000 40,000 6 months notice on the break. 3rd Vacant 343.27 3,695 4th Royal Mencap Society 208.01 2,239 29.3.2016 28.3.2019 3 12 per annum Lease is excluded from the L&T Act 1954. Landlord and Tenant rolling break option upon one month s notice. TOTAL 1560.85 16,801 60,012

COVENANT Advanced Personnel Management Group (UK) Limited Company No 04881405 Advanced Personnel Management Group is a leading international human services organisation delivering employment, injury management/ vocational rehabilitation, assessment, allied health intervention and community care services. APM has more than 1000 staff and 400 sites in Australia, New Zealand and the UK. In 2015, APM changed their name from Pertemps People Development Group. We set out below key financial highlights. 30.06.2014 30.06.2013 30.06.2012 Turnover 39,932,000 36,811,000 32,157,000 Pre Tax Profit 2,077,000-766,000-3,464,000 Shareholders Funds 14,617,000 12,815,000 13,289,000 Advanced Personnel Management (UK) Limited have an Experian Credit rating of: Very Low Risk More information can be found at www.apm-uk.co.uk The British Library Board The British Library Board has a duty to manage the British Library as a national centre for reference, study, bibliographical and other information services. The occupier of the suite is The UK Public Right office responsible for distributing payment from the government to authors on behalf of The British Library, for lending books to the Public Library. Over 22,000 writers, illustrators, editors, translators receive PLR payments annually. For the year 2015 2016, the PLR funding was set at 6.6 million. The British Library Board is not Experian rated. More information can be found at www.plr.uk.com or www.bl.uk

OCCUPATIONAL MARKET The North East office market has continued to strengthen with take up increasing year on year. Teesdale Business Park is the premier office location for Teesside, attracting occupiers such as HMRC, RBS, Santander along with Barclays and Durham University. Rents on the park peaked at circa 17.50 psf prior to the recession with rents now rebased ranging between 7.00-14.00 psf depending on the age and nature of the accommodation. ASSET MANAGEMENT OPPORTUNITIES Investigate lease re- gear potential with the second floor tenant, APM. Let vacant accommodation unlocking significant revisionary potential. Investigate leisure alternative use potential for ground floor (STP). Residential alternative use potential with permitted development rights.

INVESTMENT MARKET Set out below are a number of key recent transactions, demonstrating the ongoing activity on the Teesdale Business Park. PROPERTY DATE PRICE YIELD COMMENTS Churchill House, Teesdale Business Park Jan 16 910,000 ( 25.89 psf) - Extending to 35,144 sq ft. Sold with vacant possession equating to approximately 25.89 psf. The property was in need of c 1m capital expenditure to put into a habitable state. Ashmore & Progress House, Teesdale Business Park Oct 15 3,250,000 ( 108.20 psf) 10.70% Let to Siemens Plc and Johnson Matthey Plc with a WAULT of 6.84 years to expiry and 3.27 years to break. Total passing rent of 370,803. Teesdale House, Thornaby Jun 15 1,600,000 ( 100.23 psf) 9.42% Let to the NHS with 8.5 years to expiry and 3.5 years to break. Total passing rent of 159,440. Dunedin House, Thornaby, Stockton on Tees Aug 14 4,750,000 ( 48.14 psf) 8.54% 62% let to tenant s including Secretary of State and RBS. Extending to 98,268 sq ft. Robert House, Thornaby, Stockton on Tees Oct 14 499,000 ( 45.03 psf) - Purchased by the tenant. Teesdale House, Thornaby Apr 14 1,305,000 ( 81.75 psf) 11.55% Let to the NHS with 9.5 years to expiry at a passing rent of 159,440.

VAT We understand the property is elected for VAT and it is anticipated the sale will be treated as a Transfer of a Going Concern (TOGC). EPC The property has an EPC rating of C(60), both the EPC certificate and recommendation report are available upon request. RICHARD HOUSE PROPOSAL Offers are sought in excess of 625,000 reflecting an attractive NIY of 9.13% and a reversionary yield of 17.38% upon letting the vacant accommodation and assuming standard purchasers costs of 5.12%. A purchase at this price reflects a low capital value of just 37.20 psf. FOR FURTHER INFORMATION For further information please contact; Peter Atkinson Tel: 0191 223 5715 peter.atkinson@cushwake.com Katy Paxton Tel: 0191 223 5752 katy.paxton@cushwake.com Gagan Jagpal Tel: 0191 223 5709 gagan.jagpal@cushwake.com DTZ Debenham Tie Leung Limited (the Agents ) give notice to anyone who may read these particulars as follows: 1. These particulars are prepared for the guidance only of prospective purchasers. They are intended to give a fair overall description of the property only and do not constitute any part of an offer or contract. 2. Any information contained in these particulars (whether in the text, plans or photographs) is given in good faith but should not be relied upon as being a statement or representation of fact or that the property is in good condition or otherwise nor that any services or facilities are in good working order. 3. The photographs appearing in these particulars show only certain parts and aspects of the property at the time when the photographs were taken. Certain aspects may have changed since the photographs were taken and it should not be assumed that the property remains precisely as displayed in the photographs. Furthermore no assumptions should be made in respect of parts of the property which are not shown in the photographs. Any areas, measurements or distances referred to herein are approximate only. 4. Where there is reference in these particulars to the fact that alterations have been carried out or that a particular use is made of any part of the property this is not intended to be a statement that any necessary planning, building regulations or other consents have been obtained and these matters must be verified by any intending purchaser. 5. No person in the employment of the Agents has any authority to make or give any representation or warranty whatsoever in relation to this property. 6. This property is offered subject to contract and unless otherwise stated all rents are quoted exclusive of VAT. 7. Unless otherwise stated, no investigations have been made by or on behalf of the Agents regarding pollution, or potential land, air or water contamination. Interested parties are advised to carry out their own investigations as required. June 2016 Designed & produced by www.creativestreakdesign.co.uk ref: 926