90-93 // 95-96 BROAD STREET // 1-5 CHAIN STREET // READING · 2016-09-21 · john lewis primark m&s...

90-93 // 95-96 BROAD STREET // 1-5 CHAIN STREET // READING

P R I M E R E T A I L B L O C K I N V E S T M E N T F O R S A L E

INVESTMENT SUMMARY

• Reading is one of the strongest retailing centres in the south east and is due to benefit from Crossrail opening in 2019.

• Freehold.

• Rarely available retail block, occupying a prime position at the junction of Broad Street and Chain Street, one of the main routes to Broad Street from The Oracle.

• 58% of the income is secured to the undoubted covenants of Barclays Bank PLC and SportsDirect.com Retail Limited with an overall WAULT of 6 years.

• Potential to increase the rents on both frontages given the discount to historic prime tones.

• The current rent passing is £1,387,001 per annum exclusive.

• Our clients are seeking offers in excess of £21,000,000 (Twenty One Million Pounds) subject to contract and exclusive of VAT. A purchase at this level would reflect a net initial yield of 6.18%, after allowing for purchasers costs of 6.75%.

INVESTMENT SUMMARY

90-93 // 95-96 BROAD STREET // 1-5 CHAIN STREET

PAGE 01

JOHN LEWIS

PRIMARK

M&S

BROAD STREET

CHAIN STREET

FRIAR STREET

KING’S ROAD

THAMES TOWER

READING STATION

THE ORACLE SHOPPING CENTRE

90-93, 95-96 BROAD STREET& 1-5 CHAIN STREET

PAGE 02


THE LOCATION

LOCATIONReading is Berkshire’s County Town and its principle commercial and retailing centre.

Strategically located on the M4/Thames Valley Corridor, the town is situated approximately 64 km (40 miles) west of Central London, 40 km (25 miles) south east of Oxford and 27 km (17 miles) north of Basingstoke.

The town benefits from excellent road communications and is located circa 6.4 km (4 miles) north of Junctions 10, 11 and 12 of the M4 Motorway.

Reading’s mainline railway station, the second busiest outside of London, is situated within 5 minutes’ walk of the property and provides regular services to London (Paddington) with a fastest journey time of approximately 25 minutes. The station has been upgraded and now includes additional platforms and a new entrance.

London’s Heathrow Airport is situated approximately 32 km (20 miles) to the east of the town and is accessed via the M4 Motorway.

Crossrail will come to Reading and is due for completion in 2019. It is anticipated that the opening of the line will further enhance the town’s position as one of the south east’s main transport hubs.

M25

M1

M1

M25

M23

M25

M3

M3

M4M4

M4

M40

M40

A1

J11

J10J12

A33

A329

A404

A413

A355

A40

A418

A34

A34

A4

A34

A4074

A4130

A4130

A4010

A406

A4074

A31

A31

A322

A322

A3

A3

A316

A3

A24

A24

A287

A308

A329(M)

A404 (M)

EPSOM

READING

WOKING

BASINGSTOKE

BRACKNELL

SLOUGH

OXFORD

MAIDENHEADLONDON

READING

WATFORD

HARROW

ST ALBANS

GUILDFORD

EPSOM

HIGH WYCOMBE

NEWBURY

HEATHROWAIRPORT

A329

SOUTHA

MPTO

N ST

DU

KE

ST

LO

ND

ON

ST

CROWN ST

LONDON RD

LONDON RD

WEST ST

BRIDG

E ST

CHATHAM ST FRIAR ST

WATLIN

GTO

N ST

CASTLE ST

MINSTER ST KING’S RD

KENAVON DR

FORBURY RDGREAT KNOLLYS ST

SOUTH ST

GARRARD ST

FIELD R

D

BROAD ST

CHA

IN ST

KING’S RD

QUEEN’S RD KING’S RD

QUEEN’S RD

A329

A33

A329

A329

THE ORACLESHOPPING

CENTRE

BROADSTREET

MALL

UNIVERSITYOF READING

READINGCOLLEGE

READING

To Junction 11and Basingstoke

To Junction 10London and

Heathrow Airport

To Oxford

To Junction 12

90-93, 95-96 & 1-5

PAGE 03


THE LOCATION

DEMOGRAPHIC PROFILEReading has a resident population of circa 233,000 people and an estimated primary catchment of 640,000, ranking the town 19th of the 200 PROMIS Centres on this measure.

The catchment contains a significantly above average proportion of “wealthy executives” (CACI), with this category accounting for 23.6% of Reading’s population, compared to the national average of 8.5%.

The CBRE estimated shopping population of Reading is 416,000, ranking the town 17th of the PROMIS centres, which is above the average for the Regional Centres.

Reading ranks 13th in terms of the volume of comparison retail spend available in the catchment area. There is a high proportion of the more affluent AB households throughout most of Reading’s catchment, and a positive daily inflow of commuters due to the town’s well established office market. Employment is focused around IT, investment and insurance with key employers including Microsoft, Oracle, Prudential, EY, Thames Water and Verizon.

There are also several large public sector employers such as the Borough Council, the University of Reading, Inland Revenue and Royal Berkshire NHS Trust.

RISING EMPLOYMENT

KEYEMPLOYERS

WEALTHY EXECUTIVES

POPULATION OF C. 233,000

ESTABLISHED SHOPPING AREA

HIGH INFLOW OF COMMUTERS

AFFLUENT HOUSEHOLDS

PAGE 04


THE LOCATION

RETAILING IN READINGReading is a dominant Regional retailing centre, ranked 14th in the Javaline Group Venuescore 2015-2016 Index.

The prime retailing within Reading is focused around the covered, Hammerson owned, Oracle Shopping Centre and the pedestrianised Broad Street. Retailers such as John Lewis, Marks & Spencer, Primark, Boots, H&M, Next and River Island are all located on Broad Street.

The Oracle Shopping Centre opened in 1999 and is situated to the east of Broad Street and comprises approximately 764,000 sq ft of retail and leisure accommodation, split across two levels. The Centre contains 102 individual units, together with two multi-storey car parks providing approximately 2,300 spaces. The scheme is anchored by Debenhams and House of Fraser.

The other main managed shopping centre is the Broad Street Mall, which is located at the western end of Broad Street. The scheme comprises approximately 400,000 sq ft of retail accommodation and is split over two levels. Occupiers here include TK Maxx, Argos, New Look and Peacocks.

Reading ranks 17th on the basis of its PMA Retail Score and 20th on the PMA Fashion Score; the town ranks 12th on the PMA Anchor Score.

PAGE 05


THE LOCATION

BROAD STREET

QU

EE

N V

ICTO

RIA

ST

RE

ET

CR

OS

S S

TR

EET

(PEDESTRIANS ONLY)

(PEDESTRIA

NS O

NLY)

(CYCLES & PEDESTRIANS ONLY)

ST MA

RYS BUTTS

CH

AIN

MINSTER STREET

BUTT

ER M

ARK

ET

UN

ION

ST

RE

ET

(PEDESTRIANS ONLY)

STREET

SITUATIONThe subject property which is highlighted on the goad plan occupies a prime central trading location on the pedestrianised Broad Street at its junction with Chain Street, one of the main routes from the Oracle to Broad Street. Occupiers in the immediate vicinity include JLP, Marks & Spencer, River Island, Next, H&M and Pret A Manger.

The block is centrally located between the main entrances to Oracle and Broad Street Mall Shopping Centre.

PAGE 06


THE LOCATION

DESCRIPTIONThe property has its main frontage to Broad Street and a second frontage to Chain Street.

The Broad Street frontage is arranged over basement, ground, mezzanine and two upper floors, providing a combination of sales and ancillary space.

2-5 Chain Street comprises four individual units arranged to provide ground floor sales accommodation, together with a combination of mezzanine sales and basement ancillary accommodation.

95/96 Broad Street was constructed in the 19th century and comprises two retail units of traditional brick construction. 95 Broad Street is Grade II listed and is arranged on ground and 3 upper floors under a part-flat and part-pitched clay tiled roof. 96 Broad Street was originally two buildings converted into a single retail unit, with a return frontage to Chain Street.

The units benefit from shared rear servicing.


THE SITE

TENANCY SCHEDULEADDRESS TENANT ACCOMMODATION LEASE START

DATELEASE EXPIRY

DATE BREAK RENT REVIEW

PASSING RENT P.A.

PASSING RENT (ZONE A / SQ FT) ERV P.A. ERV

(ZONE A / SQ FT) COMMENTS

90/93 Broad Street

Barclays Bank PLC

Ground Sales 5,936 sq ft

16/01/2009 15/01/2024 - 16/01/2019 £550,000 £258.00 £425,000 £200.00 -

ITZA 1,575 units

Basement Sales 4,728 sq ftBasement Ancillary 1,583 sq ft

Total 12,247 sq ft

90/93 Broad Street

SportsDirect.com Retail Limited

Ground Floor 492 sq ft

18/06/2011 17/06/2021 - 18/06/2016 £250,000 £10.15 £271,000 £11.00 -First Floor Sales 11,456 sq ftSecond Floor Sales 12,693 sq ft

Total 24,641 sq ft

Unit 2 Chain Street

Bravissimo Limited


03/12/2010 02/12/2020 - 03/12/2015 £80,000 £73.13 £91,000 £85.00 Rent review outstanding

ITZA 731 units

Basement Ancillary 1,080 sq ftMezzanine Sales 4,000 sq ft

Total 6,178 sq ft

Unit 3 Chain Street Blacks Retail Ltd


08/05/2013 07/05/2023 T:08/05/2018 08/05/2018 £90,000 £85.00 £90,000 £85.00 -

ITZA 719 units

Basement Ancillary 926 sq ftMezzanine Sales 4,542 sq ft

Total 6,529 sq ft

Unit 4 Chain Street

Keith William Gill & Bride Gill t/a Robert Gatward Jewellers

Ground Sales 851 sq ft

01/11/2004 31/10/2019 - 01/22/2014 £70,000 £105.00 £57,000 £85.00 Rent review outstanding

ITZA 653 unitsBasement Ancillary 926 sq ft

Total 1,777 sq ft

Unit 5 Chain Street

Washington Green Retail Limited

Ground Sales 647 sq ft

13/07/2007 12/07/2017 - - £57,000 £105.00 £43,500 £80.00 -ITZA 542 unitsBasement Ancillary 58 sq ft

Total 705 sq ft

95 Broad Street

Ann Summers Limited


25/12/2007 24/12/2022 - - £130,000 £200.00 £130,000 £200.00 -

ITZA 621 units

First Ancillary 389 sq ft

Second Ancillary 410 sq ftThird Ancillary 263 sq ft

Total 2,350 sq ft

96 Broad Street & 1/5 Chain Street

Cath Kidston Ltd


30/09/2011 29/09/2021 - 30/09/2016 £160,000 £200.00 £160,000 £200.00 -

ITZA 722 units

First Sales 684 sq ftFirst Ancillary 454 sq ft

Total 2,620 sq ft

Electricity substation

Southern Electric Power Distribution Plc

07/01/2003 06/01/2028 - - £1 - £1 - -

TOTALS 57,047 sq ft £1,387,001 £1,267,501

TENUREFreehold.

TENANCIESThe property is let in accordance with the adjacent tenancy schedule, producing a current rental income of £1,387,001 pax, with no shortfalls. The majority of leases are let on effectively Full Repairing and Insuring terms, recoverable via a service charge, details of which are available from this office. 95/96 Broad Street are let on Full Repairing and Insuring terms.

PAGE 08


TENURE, TENANCIES, RENTAL VALUE & COVENANT

RENTAL VALUEWe have set out the individual rental values in the tenancy schedule above, resulting in a total rental value of £1,267,501 per annum. This reflects a prime Zone A tone of £200 per sq ft on the Broad Street frontage, and £80-£85 per sq ft Zone A on the Chain Street frontage.

We have applied an overall rate of £11 per sq ft to the Sports Direct demise.

The most salient rental evidence can be set out as follows:

9/10 BROAD STREET (TIGER RETAIL)Open market letting, April 2016, agreed at a rent of £195,000 per annum exclusive, which devalued to a net Zone A rent of £207.08 per sq ft.

35 BROAD STREET & UPPER PARTS OF 31 QUEEN VICTORIA STREET (ITSU) Open market letting July 2015, agreed at a rent of £165,000 per annum exclusive, which devalued to a net Zone A rent of £202.86 per sq ft.

PAGE 09



COVENANT INFORMATIONThe summary of accounting information for each of the tenants is out below:

Sports Direct International Plc

28/04/2015 27/04/2014 26/04/2013Experian Score

GBP GBP GBP

Turnover £2,832,560,000 £2,705,958,000 £2,185,580,000

100Pre-tax profit £313,446,000 £239,452,000 £207,226,000

Net Worth £908,997,000 £565,983,000 £404,511,000

Robert Gatward Jewellers Limited

30/09/2014 30/09/2013 31/03/2013Experian Score

GBP GBP GBP

Turnover £7,703,679 - -

80Pre-tax profit £1,060,896 - -

Net Worth -£1,527,831 - -

Cath Kidston Limited

29/03/2015 30/03/2014 31/03/2013Experian Score

GBP GBP GBP

Turnover £115,420,000 £113,821,000 £105,049,000

100Pre-tax profit £10,242,000 £22,593,000 £18,694,000

Net Worth £38,286,000 £70,701,000 £50,618,000

Barclays Bank Plc

31/12/2015 31/12/2014 31/12/2013Experian Score

GBP GBP GBP

Turnover - - -

95Pre-tax profit £2,841,000,000 £2,309,000,000 £2,885,000,000

Net Worth £55,845,000,000 £55,576,000,000 £53,264,000,000

Blacks Outdoor Retail Ltd

02/02/2015 01/02/2014 31/01/2013Experian Score

GBP GBP GBP

Turnover £115,473,000 £99,218,000 £126,882,000

26Pre-tax profit -£15,036,000 -£10,696,000 -£21,214,000

Net Worth -£42,443,000 -£37,295,000 -£29,669,000

Ann Summers Limited

27/06/2015 28/06/2014 29/06/2013Experian Score

GBP GBP GBP

Turnover £104,818,310 £101,212,066 £114,914,259

90Pre-tax profit £1,025,990 -£3,928,273 £2,395,068

Net Worth £47,844,808 £46,975,132 £50,542,763

Bravissimo Limited

31/08/2014 31/08/2013 31/08/2012Experian Score

GBP GBP GBP

Turnover £54,059,256 £46,463,517 £44,672,590

100Pre-tax profit £4,684,806 £2,524,576 £1,766,322

Net Worth £10,563,399 £7,815,669 £6,017,769

Washington Green Retail Limited

30/04/2015 30/04/2014 30/04/2013Experian Score

GBP GBP GBP

Turnover £24,493,144 £21,154,701 £14,909,667

46Pre-tax profit £362,381 £389,936 -£1,358,702

Net Worth -£354,976 -£804,531 -£1,164,826

PAGE 10



24 BROAD STREET, READING (LLOYDS)Freehold retail rack rented investment let to Lloyds for a further 10 years, sold in May 2016 for a price of £4,760,000, reflecting a net initial yield of 4.4%.

107/108 BROAD STREET (GAP)Freehold retail investment let to Gap at a rent of £280,000 pa, reflecting £176 Zone A, was purchased by Legal & General in June 2015 as part of the Mayfly portfolio at an apportioned price, reflecting a net initial yield of 4.85%.

BROAD STREET MALL, READINGShopping Centre investment purchased by Moorgarth in May 2015 for £62,250,000, reflecting a net initial yield of 6.85%. Anchor tenants include New Look, Argos and TK Maxx.

116/119 BROAD STREET (BHS)Freehold store sold in December 2014 for £23,000,000, reflecting a net initial yield of 5.25%. The tenant subsequently assigned the lease to Primark.

INVESTMENT COMPARABLESThe most salient comparable investment evidence can bet set out as follows:

PAGE 11


COMPARABLES

IMPORTANT NOTICE: Jackson Criss, their clients and any joint agents give notice that: 1.They are not authorised to make or give any representations or warranties in relation to the property either here or elsewhere, either on their own behalf or on behalf of their client or otherwise. They assume no responsibility for any statement

that may be made in these particulars. These particulars do not form part of any offer or contract and must not be relied upon as statements or representations of fact. 2. Any areas, measurements or distances are approximate. The text, photographs and plans are for guidance only and are not necessarily comprehensive. It should not

be assumed that the property has all necessary planning, building regulation or other consents and Jackson Criss have not tested any services, equipment or facilities. Purchasers must satisfy themselves by inspection or otherwise. August 2016

Designed & produced by Cre8te - 020 3468 5760 - www.cre8te.london

PAGE 12

CONTACTFor further information, please contact:

PHILIP HAY 020 7637 [email protected]

BROOK WANNOP 020 7637 [email protected]

VATWe understand that the property is elected for VAT and therefore VAT will be payable on the purchase price. It is envisaged that the sale will be dealt with as a Transfer Of a Going Concern (TOGC).

EPCCopies of the EPC ratings and reports are available from this office.

PROPOSALWe are instructed to seek offers for our clients’ freehold interest in excess of £21,000,000 (Twenty One Million Pounds) subject to contract and exclusive of VAT.

A purchase at this level would reflect the following yield profile after allowing for purchaser’s costs of 6.75%.

Net initial yield 6.18%

Reversionary yield 5.64%

Equivalent yield 5.82%

True equivalent yield 6.04%


FURTHER INFORMATION

90-93 // 95-96 BROAD STREET // 1-5 CHAIN STREET // READING · 2016-09-21 · john lewis primark m&s...

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