WICKES FRASER ROAD, ERITH, LONDON DA8 1QX. GREATER LONDON RETAIL WAREHOUSE INVESTMENT Open A1 (non-food) planning consent

Transcription

1 WICKES FRASER ROAD, ERITH, LONDON DA8 1QX GREATER LONDON RETAIL WAREHOUSE INVESTMENT Open A1 (non-food) planning consent

2 INVESTMENT SUMMARY > Greater London solus retail warehouse investment within the London Borough of Bexley. > Prominent and accessible retailing location on Fraser Road (A206) adjacent to Atlas Trade Park and proposed Lidl foodstore. > Purpose built solus retail warehouse totalling 30,842 sq ft (assumed 30,000 sq ft for rent review purposes) with 124 car parking spaces. > Large 2.13 acre site with low site coverage of 33%. > Open A1 non-food planning consent. > Freehold. > Secure income of 9.35 years unexpired to Wickes Building Supplies Ltd, rated 5A1 by Dun & Bradstreet. > Passing rent of 405,000 pa, reflecting a low rent of per sq ft. > Low capital value of 218 per sq ft. Our client is seeking offers in excess of 6,725,000 (Six Million, Seven Hundred and Twenty-Five Thousand Pounds), subject to contract and exclusive of VAT. A purchase at this level reflects an attractive net initial yield of 5.65%, assuming purchase costs of 6.64%. Page 2

3 LOCATION Erith is located within the London Borough of Bexley in south-east London. The town lies south of the River Thames with excellent road communications M4 providing direct access to Dartford. The M25 motorway is to the east and central London is to the west via the A102. Erith railway station is in close proximity Richmond to the property with a peak service that includes trains to Charing Cross Station and Cannon Street Station, via Woolwich and Greenwich. Abbey Wood Station, which is 2.8 miles to the west of the property, will benefit from Kingston Crossrail services reducing journey times upon to Central Thames London to 25 minutes and 11 minutes to Canary Wharf. Belvedere A206 Brook St Riverdale Rd Harrow Wembley Frank s Park Lessness Heath Epsom Riverdale Rd Pembroke Rd LONDON Brixton Dulwich Balham Village Mitcham Croydon Sutton A220 A2016 Purley West St ERITH Stratford Canary Wharf Bromley Erith High St Riverside Shopping Centre Ilford Barking Woolwich River Thames Downe Dagenham Welling Bexleyheath Sidcup Opington Romford ERITH Hornchurch Dartford M20 M25 SITUATION M25 West Kingsdown South Ockendon Grays Gravesend Abbey Wood Crossrail Station to Central London 25 MINS The subject property is situated on the southern side of Fraser Road (A206), which connects Erith town centre with Belvedere and Woolwich to the west. Atlas Trade Park lies adjacent to the site, which is occupied by Topps Tiles, Screwfix, Bath Store, Tile Giant and Metro Service Station (vehicle MOT centre). Lidl recently acquired this site and are preparing to submit a planning application to redevelop the property to provide a solus foodstore unit. Brook St Carlton Rd Park Cres Europa Industrial Estate is immediately north of the subject property and comprises a large multi-let estate, which is part owner occupied by Batt Cables Plc. Northumberland Heath Recreation Ground A220 Avenue Rd Erith Recreation Ground A206 Broo Page 3

4 A1020 CATCHMENT AND DEMOGRAPHICS Thamesmead A13 Wennington The London Borough of Bexley has a catchment population of 232,000 people (2011 Census), which is forecast to grow to 252,500 by The catchment population within a 10 minute drive time is 90,667 people (Source: Oxford Retail Consultants). Multiple car ownership is significantly above the UK average within a 10 minute drive time. Woolwich Shooters Hill Plumstead Abbey Wood Belvedere A206 A220 ERITH A206 Purfleet Erith is an important district centre within the London Borough of Bexley and is considered the dominant retail and service centre for the north of the Borough. Erith has been identified by the Borough as a key focus for regeneration and the area has experienced significant inward investment with a focus on residential-led developments over recent years. The opening of the Crossrail station at Abbey Wood has already attracted several large-scale residential developments in the surrounding area, which includes up to 5,200 new homes on four sites in Thamesmead. Erith has a strong demographic profile with the following population characteristics within a 10 minute drive time: Welling Bexleyheath Falconwood A2 Avery Hill Blackfen Bexley Drive time key 5 mins Lamorbey 10 mins 15 mins 20 mins A2 Dartford A282 Home ownership Above the national average Economically active Above the national average Car ownership Above the national average Convenience goods spend Above the national average Page 4

5 DESCRIPTION The subject property comprises a purpose built solus retail warehouse unit that was originally developed in The unit is of steel portal frame construction with brick and profile steel clad elevations and extends to 30,842 sq ft (assumed 30,000 sq ft GIA at rent review). The ground floor area is approximately 30,036 sq ft and there is a lobby area to the front of the property totalling 806 sq ft. The accommodation is well configured for the tenant s use with a loading area and a builder s yard to the rear of the property. There are approximately 124 car parking spaces to the front of the unit (1:249 sq ft). The site area is approximately 2.13 acres, resulting in a low site coverage of 33%. Metro Service Centre Atlas Trade Park Proposed Redevelopment 124 Parking Spaces Open A1 (non-food) planning consent BATT Cables Fraser Road (A206) PLANNING The orignal planning consent (98/00234/FUL) was granted on 18 May 2000 for the redevelopment of the site comprising non-food retail units and an open garden centre including a glazed area and associated car parking and access. For indicative purposes only The use of the retail units shall be limited to the sale of pet foods and non-food goods only. Furthermore, all retail units comprised in the development shall be of not less than 929 square metres floor area and such units shall not be sub-divided to constitute smaller units without the prior written approval of the Local Planning Authority. Further information is available upon request. Page 5

6 TENANCY The subject property is let in its entirety to Wickes Building Supplies Limited on a 25 year term expiring on 23rd June 2027 (9.35 years unexpired). The passing rent is 405,000 pa, which reflects psf based on the floor area specified in the lease (30,000 sq ft). Rent reviews are five yearly to open market value, with the next review in June The lease is drawn on institutional full repairing and insuring terms. The Tenant is allowed to assign the whole or underlet the whole or a Permitted Part (less than 6,000 sq ft), subject to the Landlord s consent. TENANT COVENANT Wickes Building Supplies Limited opened its first store in the UK in 1972 and now has a portfolio of over 220 stores. In February 2005 Wickes was acquired by Travis Perkins, which is a leading company in the Builders Merchanting and Home Improvement markets. The subject property is let to Wickes Building Supplies Limited which is the operational company of the business and the company against which their property leases are secured. Wickes Building Supplies Limited has a Dun & Bradstreet rating of 5A1, which represents a minimum risk of business failure. A summary of the company s last three years accounts is set out below: Year Turnover (000 s) Pre-Tax Profits (000 s) Tangible Net Worth (000 s) ,213,269 65, , ,104,950 60, , ,039,986 68, ,080 Page 6

7 RENTAL GROWTH PROSPECTS Low passing rent of psf The subject property has a low passing rent of per sq ft, which was agreed at the June 2017 rent review. The property has a history of strong rental growth, which has increased by 50% from the original letting at 9.00 per sq ft in We believe the subject property still has good rental growth prospects and would highlight the below evidence: Location Tenant Transaction Date GIA sq ft Rent (psf) Dartford Wickes Lease Renewal , Blackheath Wickes Rent Review , Catford Wickes Rent Review , RETAIL WAREHOUSE PROVISION The subject property and adjacent Atlas Trade Park currently forms the only out of town retailing provision within Erith. Lidl acquired the adjacent trade park in 2015 and will shortly submit a planning application to redevelop the property to provide a new solus foodstore unit, which will greatly enhance the local retailing environment. The nearest competing centres are Dartford, Crayford and Bexleyheath. In terms of local DIY provision, B&Q occupy a recently reconfigured 57,475 sq ft in Belvedere approximately 1.7 miles to the north. The nearest Wickes store is in Plumstead, 3.6 miles to the west. Page 7

8 ALTERNATIVE USE City of London Abbey Wood South Thamesmead Given its strong Greater London location and surrounding uses, the subject property may also suit longer term redevelopment for residential use. The local area has been identified in the London Borough of Bexley s Growth Strategy as an area for mixed use development of medium density. Residential redevelopment Erith and the wider area has been subject to significant residentialled development, which is due to continue with several large schemes now under construction or having been identified as key regeneration areas within the Borough s Growth Strategy. As a result, average residential values have increased in Erith by 13% between 2015 and Residential values are now in the region of 375 per sq ft and increasing. Erith Park, Erith Regeneration by Orbit and Wates of former 1970s tower blocks to provide 588 new homes, which are 100% under offer. Values are in the region of 365+ per sq ft. The Quarry, Erith A 20 acre site is being developed in close proximity to the subject property on Fraser Road by London & Quadrant, in partnership with Anderson Group, to provide 600 new homes. Phase One homes are now for sale and are achieving 375+ per sq ft. South Thamesmead The large-scale residential-led development will deliver up to 2,500 new homes over the next 10 years through a partnership between Peabody, the London Borough of Bexley and the Royal Borough of Greenwich. Residential values are approximately 450+ per sq ft. Europa Industrial Estate, Erith The site opposite the subject property has been earmarked by the London Borough of Bexley for future residential redevelopment providing up to 1,550 new homes. Atlas Trade Park Proposed Redevelopment Erith Park & Erith Riverside Shopping Centre The Quarry Europa Industrial Estate Erith Train Station Belvedere Page 8

9 TENURE Freehold. VAT The property is elected for VAT. EPC B 43. Available upon request. ENVIRONMENTAL An environmental report is available upon request. PROPOSAL Our client is seeking offers in excess of 6,725,000 (Six Million, Seven Hundred and Twenty-Five Thousand Pounds), subject to contract and exclusive of VAT. A purchase at this level reflects an attractive net initial yield of 5.65%, assuming purchase costs of 6.64%. FURTHER INFORMATION Edward George Edward.George@montagu-evans.co.uk Nick Richardson Nick.Richardson@montagu-evans.co.uk Will Collins Will.Collins@montagu-evans.co.uk Misrepresentation Act 1967 Montagu Evans LLP for themselves and for the vendors or lessors of this property whose agents they are, give notice that : (i) The particulars are set out as a general guideline only for the guidance of intending purchasers or lessees and do not constitute the whole or any part of an offer or contract.(ii) All descriptions, dimensions, references to condition and necessary permissions of the use and occupation, and other details are given in good faith without responsibility whatsoever and any intending purchasers or tenants 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. (iii) Neither Montagu Evans LLP nor their employees has any authority to make or give any representation or warranties whatsoever in relation to the property. (iv) Unless otherwise stated, all prices and rents are quoted exclusive of VAT and intending purchasers or lessees must satisfy themselves independently as to the applicable VAT position. (v) All the plans and maps provided within the particulars are for identification purposes only February 2018 Designed and produced by THE GROUP