Prime High Street Freehold INVESTMENT FOR SALE
Investment summary Highly affluent London Borough of Richmond; 100% prime George Street location; Freehold; Arguably most prominent unit on George Street; Let entirely to The Carphone Warehouse Ltd (D&B 5A1); 3,480 sq ft approx. NIA; 200,000 per annum net income; Reversionary rent; Asset management potential. OFFERS IN EXCESS OF 4,500,000 (Four Million Five Hundred Thousand Pounds Only) exclusive of VAT and subject to contract. Assuming purchaser s costs of 6.57%, a purchase at this level would show the following yield profile: Net Initial Yield: 4.17% Nominal Equivalent Yield: 4.27% Reversionary Yield: 4.28%
Location HARROW Richmond upon Thames boasts a rich history, royal connections, extensive parkland, iconic architecture and a vast array of amenities. Richmond has a catchment population of over 250,000 and an estimated 1.9million people within 20 minutes of the town. MAIDENHEAD BRACKNELL SLOUGH WINDSOR M25 STAINES UXBRIDGE WEST DRAYTON HEATHROW M4 HOUNSLOW WEMBLEY UPON THAMES WESTFIELD HAMMERSMITH WIMBLEDON ASCOT SUNBURY KINGSTON M3 WEYBRIDGE Richmond upon Thames is located approximately 9 miles south west of Central London and 4 miles north of Kingston and is one of London s most popular and prosperous boroughs. Local residents are highly affluent, with over 75% falling within the class AB and C1 groupings. Mean earnings in excess of 58,000 per year facilitate per capita spending vastly greater than the national average. In a recent survey conducted by Rightmove, Richmond was voted the happiest place to live in London. POPULATION 250,000 KINGSTON 4 miles CENTRAL LONDON 9 miles
Retailing in Richmond Richmond is a thriving commercial centre with a flourishing retail offer, encompassing an extensive array of mass market and specialist retailers which attract a significant number of tourists and visitors. The compact nature of the town centre means there is little threat to the existing retail from new, large scale developments and Richmond is forecast to see significant, above average growth in retail spending by 2021. The prime activity is focused on George Street with House of Fraser anchoring its southern end. Other notable retailers represented include Marks & Spencer, H&M, Topshop/Topman, Boots, Tesco, WH Smith, Anthropologie, Reiss, Massimo Dutti, Gant, Jo Malone, Molton Brown, Office and Links.
By train, Richmond is served by mainline South West Trains, which provide regular direct services to London Waterloo in approximately 19 minutes. The town is also served by the London Underground, via the district line. Communications The town has excellent road communications. The A307 runs directly through the town centre providing access to Kingston upon Thames, 4 miles to the south, and ultimately the M25 via the A3. The A316 is located immediately to the north of Richmond train station and connects with the M3 motorway circa 6 miles to the east As a magnet for 4.5 million tourists annually, many of Richmond s visitors come from further afield. Heathrow, the UK s largest international airport is located circa 11 miles (30 minute drive) to the west via the M4, providing services to a wide variety of both domestic and international destinations. HEATHROW 11 miles WATERLOO 19 min TOURISTS 4.5 mil
Situation The property sits on the north side of George Street in 100% prime pitch. Its frontage projects forward from the surrounding building line, making it one of the most prominent shops on George Street. The subject property lies adjacent to Topshop and Holland & Barrett and brands situated nearby include Gant, Office Shoes, H&M, Crew Clothing, Zara Home, Russell & Bromley and Boots.
Description The ground and basement levels are arranged as retail sales space with some staff and storage accommodation. The upper parts have been sub-let by the tenant to Quadrant Real Estate Holdings: a property management company. The offices occupy the first and second floors and are accessed via a separate access from the return frontage on the west side of the façade. Accommodation Tenancy The property has the following net internal areas: The property is let in its entirety to The Carphone Warehouse Ltd, trading as Carphone Warehouse, on a 15 year full repairing and insuring lease expiring 28th October 2019 at a current rent of 200,000 per annum exclusive. The upper parts are sub-let to Quadrant Real Estate Holdings at a current passing rent of 34,000 per annum from 1st January 2017 expiring 20th October 2019. Retail Floor Areas Sq. Ft. Sq. M. Ground Floor Sales 1,499 139.3 Ground Floor ITZA 719 66.8 Ground Floor Ancillary 218 20.3 Basement Storage 600 55.8 TOTAL RETAIL AREA 2,317 215.3 Upper Parts Sq. Ft. Sq. M. First Floor Offices 559 51.9 Second Floor Offices 606 56.3 TOTAL OFFICE AREA 1,165 108.3 TOTAL AREA 3,482 323.6 Tenure Freehold R ICH MON D
Reversionary Retail Rent Applying Market Rents of 29psf (as per the recent sub-letting of the first and second floors) on the upper floors of the property, we calculate that the passing rent reflects 223 psf ITZA. There has been significant letting activity in this part of George Street since 2013, notably the following transactions in the close vicinity: Tenant Address Date Rent Leon 31-35 Nov-16 238 psf ITZA George Street Asset Management Potential The tenant, The Carphone Warehouse, is understood to trade well from the property and have indicated that they intend to renew in 2019. They do not wish, however, to keep sub-letting the upper parts due to the management input required and their ongoing repairing liability. At the 2019 renewal or before, therefore, there should be an opportunity to re-gear the tenant s lease to a Market Rent and release the upper parts for separate letting or refurbishment/ redevelopment. There is a large flat roof to the rear of the first floor office space and this may offer (subject to planning) the potential to expand the accommodation available. Tea Too 50 Jun-15 225 psf ITZA George Street Massimo Dutti 44/45 Sep-14 230 psf ITZA George Street Reebok 36 Oct-13 238 psf ITZA George Street We are therefore of the opinion that 238 psf ITZA is applicable to the property. Applying the same analysis to the upper parts, we are of the opinion that the property has a Market Rent today of approximately 211,250 per annum. Investment comparables Tenant Covenant Recent transactions support the pricing: Since its foundation in 1989, The Carphone Warehouse has established a highly respected, prominent business with over Address 2,400 stores trading across Europe. Date The business Price has been a subsidiary Yield of Dixons Comment Carphone PLC since 7 August 2014. We set out The Carphone Warehouse Ltd s (02142673) financial information from the last 3 years as follows: Le Pain Quotidien January 4.85m 3.71% Freehold, 15 year term certain, Notting Hill Gate, W11 2014 uppers sold off Very Low Risk 000s 30th April 2016 2nd May 2015 29th March 2014 Pizza Turnover Express March 1.86m 2,104,671 3.90% 2,056,123 Virtual freehold, 15 year 1,783,596 term certain, Coptic Pre-tax Street, Profit WC1 2014 86,056 77,146 uppers sold off 90,986 Tangible Net Worth 1,029,021 1,007,570 955,778 Bills & Paul August 6.2m 3.81% Freehold, 17 years and 8 years term Kingsway, The company WC2has a 5A1 Dun & 2014 Bradstreet rating. certain Planning The property is not listed, however it is within the Central Richmond Conservation Area. VAT The property has been elected for VAT and it is assumed the sale will be conducted via a Transfer of a Going Concern (TOGC). EPC EPC s are available upon request.
Proposal OFFERS IN EXCESS OF 4,500,000 (Four Million Five Hundred Thousand Pounds Only) exclusive of VAT and subject to contract. Assuming purchaser s costs of 6.57%, a purchase at this level would show the following yield profile: Net Initial Yield: 4.17% Nominal Equivalent Yield: 4.27% Reversionary Yield: 4.28% Viewings Viewings are to be strictly by arrangement with sole selling agents. Jamie Whitelaw 020 7494 6946 07738 684 881 jw@cwm.co.uk Jim Remfry 020 7494 6936 07525 012 444 jr@cwm.co.uk Dan Keatings 020 7494 6928 07590 570 664 dk@cwm.co.uk MISREPRESENTATIONS ACT: CWM & Partners LLP for themselves and for the vendors/lessors of the property whose agents they are, give notice that: 1. These particulars are set out as a general outline for the guidance of the intended purchasers or lessees, and do not constitute part of, an offer or contract; 2. All descriptions, dimensions, reference to, tenure, tenancies, condition and necessary permissions for the use and occupation, and other details are given without responsibility and any intending purchaser or tenant 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; 3. No person in the employment of CWM & Partners LLP has any authority to make or give any representations or warranty in relation to this property. JULY 2017