PRIME TOWN CENTRE MULTI-LET INVESTMENT … House Woking.pdf · INVESTMENT SUMMARY / Prime multi-let...

Investment SummaryHome Description and Accommodation

Tenant Covenant

Office Investment Transactions

Proposal and Contacts

Location and Situation

Tenure and Tenancy Details

Occupational Market

PRIME TOWN CENTRE MULTI-LET INVESTMENT OPPORTUNITY

WOKING

INVESTMENT SUMMARY

/ Prime multi-let town centre headquarters office building.

/ Woking benefits from excellent road and rail links, being in close proximity to the M25 and M3, and train times of only 24 minutes to London Waterloo. Heathrow lies just 15 miles to the north.

/ Grade A office and retail accommodation totalling 56,205 sq ft over ground and 3 upper floors

/ Excellent town centre car parking ratio of 1:370 sq ft (152 parking spaces)

/ The property is multi-let to 5 tenants with a WAULT of 4.0 years to expiry, and 3.4 years to break.

/ Total passing rent of £1,300,038 per annum (including top up), equating to a low average rent on the offices of £22.98 psf. Prime rents in Woking currently stand at £27.00 psf.

/ Woking currently has a low town centre vacancy rate of 5.0%, and offers excellent value compared to other South West M25 locations.

/ Woking will benefit from a £250 million town centre regeneration programme.

/ Asset management opportunities, and an opportunity to capture significant rental growth.

/ Freehold.

/ Offers are sought in excess of £18,250,000 (Eighteen Million Two Hundred Fifty Thousand Pounds), reflecting an attractive net initial yield of 6.75%, assuming purchasers costs of 5.80%.


Tenant Covenant





Occupational Market

LOCATION

THE FINANCIAL AND BUSINESS SERVICES SECTOR IS ONE OF WOKING’S LARGEST EMPLOYERS, ACCOUNTING FOR 37.8% OF THE TOTAL WORKFORCE. THIS COMPARES FAVOURABLY TO THE NATIONAL PROMIS AVERAGE OF 30.5%.

Woking is one of Surrey’s principal commercial centres. The town sits centrally within the south west quadrant of London’s M25 commuter belt, and is home to an affluent residential catchment with a population of 99,198 (2011 UK census). Woking is expected to see significant population growth up to 2027 of approximately 14.3%.

Woking’s proximity to London, and major south east towns, alongside its excellent communication links, and highly skilled workforce, have led to a thriving business community. The town has attracted a number of national and international occupiers including Surrey County Council, SAB Miller, Allianz Insurance, McLaren Group, Yum!, Clear Channel, WWF, Mercer, Petrofac, Skanska, and Cap Gemini.

SITUATIONMidas House is prominently situated on Goldsworth Road, within the town centre of Woking, close to the junction with Church Street West. Goldsworth Road runs immediately east into Victoria Way, which leads south to the A320 Guildford Road, and directly to Guildford town centre. The A320 also runs north east to the M25 and Chertsey. The property is just a 5 minute walk from Woking Station.

The town’s main retail pitch is only 500m to the east of the property and includes The Peacocks Shopping Centre, featuring retailers such as Debenhams, Topshop/Topman, Primark, H&M, Next, and TK Maxx. Further retail is provided by a second shopping centre at Wolsey Place, featuring national retailers including Boots, Sainsbury’s, WH Smith and Starbucks.

WOKING REGENERATIONWoking Council is one of the UK’s most proactive councils with regards to regeneration, development and job creation. The town centre has been significantly enhanced in recent years by the development of several major residential schemes, and the successful commercial mixed use redevelopment around Jubilee Square.

The retail area of the town forms the focal point of the council’s regeneration plan, with the Victoria Square development, less than 500m to the east of Midas House, identified as the next phase. The development, estimated to cost in excess of £150 million and due to complete by 2018, will provide circa 125,000 sq ft of new retail floor space, anchored by a 60,000 sq ft Marks & Spencer store, alongside a 190 bed 4* hotel, 392 residential apartments, and a further 380 car parking spaces.

Further plans are being outlined at the mixed use scheme known as Woking Gateway, adjacent to Victoria Square, which will provide up to 500,000 sq ft of new floor space.


Tenant Covenant





Occupational Market

More

Godalming

Horsham

Haywards Heath

Haslemere

Crawley

East Grinstead

Horley

Redhill

OxtedSevenoaks

Caterham

Biggin Hill

Sutton

Croydon

Bromley

Petersfield

Farnham

Fleet

Crowthorne

Camberley

Frimley

Aldershot

Farnborough

Bracknell

READING

WOKING

Dorking

Leatherhead

Windsor

MaidenheadSlough

Marlow

Henley-on-Thames

Amersham

Harrow

Wembley

Highgate

Finchley

Chesham

Chorleywood

Bushey

Hemel Hempstead

High Wycombe

Beaconsfield

Uxbridge

HounslowRichmond

LONDONWestminster

Walthamstow

IlfordIslington

Woolwich

Enfield

Wandsworth

Greenwich

Kingston UponThames

Barnet

Sunbury

Weybridge

Staines

GUILDFORD

Alton

Winchester

Eastleigh

Basingstoke

Newtown

Andover

M3

M25

A3

A3

A3

A24

A23

A27

A31

A34

A339

A33

A22A31

A331

M40

M4

M4

M3

M23

M25

M25

M1

7

212

4b15

1a16

55 miles

Heathrow

London City Airport

FarnboroughSouthampton

Gatwick

46 miles

Luton Airport

Vict

oria

Way

A32

0

V

ictori

a Way A

320

Church

St

High

Street

The Broadway

Che

rtse

y Roa

d

Vale Farm Road

Goldsworth Road

Wolsey

Walk

Church

Street

East

Stat

ion Approach

Heathside Crescen

t

JubileeSquare

Theatre &Cinema

Wolsey Place Shopping

Art CentreTo Chertsey/M25

PeacocksShopping

WokingTrain Station

Bus Station

Lockf

ield Drive A324

Oriental Road

M3

To Guildford

Woking

ROAD ACCESSM25 – J11 5 milesM3 – J3 8 milesA3 2.5 milesLondon 28 milesReading 23 milesGuildford 7 miles(Source: route.rac.co.uk)

TRAIN TIMESLondon Waterloo 24 minutes (13 trains per hour)Basingstoke 19 minsReading 47 mins

AIRPORTSHeathrow 15 milesGatwick 35 milesFarnborough 13 milesLondon City 37 miles

KEY 10 minutes drive

20 minutes drive

30 minutes drive

60 minutes drive

SAT NAV: GU21 6LQ


Tenant Covenant





Occupational Market

Back

Midas House, built in 2003, comprises an imposing 4 storey headquarters office and retail building, providing circa 52,210 sq ft of office accommodation arranged over the 1st to 3rd floors, and a further 3,995sq ft of retail/restaurant accommodation arranged in two units on the ground floor, either side of the building entrance and reception.

There is a central, large landscaped open air courtyard on the ground floor, which provides excellent natural light to the office accommodation.

Internally the office accommodation benefits from the following high quality specification:

/ Impressive manned reception area

/ VRV 4 pipe fan coil air conditioning

/ Carpeted raised floors

/ Suspended metal tiled ceilings

/ CAT 2 lighting

/ 3 passenger lifts, 1 goods lift and 1 car park platform lift

/ Male, female, and disabled WCs on each floor

/ Excellent natural light and floor to ceiling heights throughout

/ 24 hour security

The office accommodation offers excellent floor plates of 16,000 – 18,000 sq ft, which are in short supply and in considerable demand. The floors are currently arranged in a predominately open plan layout, with the ability for easy sub-division.

The property provides 152 covered/underground secure car parking spaces, equating to an excellent ratio of 1:370 sq ft.

The existing chiller is being fully replaced by the Landlord, along with the chilled water pump set. This work is anticipated to be completed at the end of October 2014.

The property has been measured in accordance with the RICS Code of Measuring Practice (6th Edition) and provides the following net internal areas:

Floor Use SQ M SQ FT

Ground Reception 194.0 2,088

Ground Restaurant 206.9 2,227

Ground Retail 164.3 1,768

1st Office 1,726.5 18,584

2nd Office 1,625.5 17,497

3rd Office 1,498.4 16,129

TOTAL 5,415.6 58,293

DESCRIPTION ACCOMMODATION


Tenant Covenant





Occupational Market

More

Light Well

Lifts Stairwells

WC’s

Office

Office

Office

Goldsworth Road

TYPICAL FLOOR PLAN


Tenant Covenant





Occupational Market

Back

TENUREFreehold.

SERVICE CHARGEThe current service charge budget is £463,625 per annum for the year ending 31/09/2014. This equates to £8.25 psf. The proposed service charge for the year commencing 01/10/2014 is £446,800, equating to £7.95 psf.

The cost of the work to replace the existing chiller and chilled water pump set has been recovered through last year’s charge.

TENANCY DETAILSThe property is multi-let, on effective FRI leases, in accordance with the tenancy schedule below.

TENURE AND TENANCY DETAILS

Current Rent Current Rent Lease Expiry Tenant Unit Description Area (sq ft) (per annum) (£ per sq ft) Lease Start Next Review (break) Comments

ASK Restaurants Ltd t/a Zizzi Restaurant/Retail 2,227 £65,000 £29.19 30/12/2005 30/12/2015 29/12/2030

Void Retail 1,768 £35,360 £20.00 - - - Vendor proposes to provide a 12 month rent, rates, and service charge guarantee.

SAB Miller plc Office: 1st 9,772 £224,860 £23.01 13/12/2012 - 19/03/2016

Menzies LLP Office: Part 1st 8,812 £203,688 £23.11 08/09/2006 - 07/09/2016

SAB Miller plc Office: Part 2nd 5,215 £116,190 £22.28 20/03/2006 20/03/2011 19/03/2016

Miller Fairclough Office: Part 2nd 12,282 £274,005 £22.31 08/04/2005 08/03/2015 07/04/2020 Sub-let to SAB Miller, expiry 7th February 2015 Management Services Ltd

Nielsen Book Services Ltd Office: 3rd 16,129 £380,935 £23.62 24/12/2013 23/12/2018 (24/12/2016)

Total 56,205 £1,300,038 £22.98 (including top up) (on the offices)

WAULT of 4.0 years to expiry, and 3.4 years to breaks.

CHARTERED S U RVEYORS5 Bolton Street, London W1J 8BATel : 020-7493 4002 Fax : 020-7312 7548www.montagu-evans.co.uk

Site Plan :Midas House, 62 Goldsworth Road, Woking GU21 6LQDate : Sept 2014

Scale 1:1250@A4 North

MONTAGUEVANS

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C Crown Copyright 2013 Licence Number 100007624


Tenant Covenant





Occupational Market

SAB Miller Plc (Reg No. 3528416) are a FTSE-100 British multinational brewing and beverage company. The company employs 70,000 staff across 80 countries, and is the world’s second largest brewer in terms of revenue, producing over 200 beers, including Peroni Nastro Azzurro,

Pilsner Urquell, Miller Genuine Draft, and Grolsch. The company is also one of the world’s largest bottlers of Coca-Cola.

The company has been awarded a Dun & Bradstreet rating of N1 (minimum risk of business failure).

31/03/2014 31/03/2013 31/03/2012 SAB MILLER PLC (£ 000s) (£ 000s) (£ 000s)

Turnover £22,311,000 £22,213,000 £21,760,000

Pre-tax Profit £4,823,000 £4,712,000 £5,603,000

Net Worth (£710,000) (£3,125,000) (£4,956,000)

ASK Restaurants Ltd (Reg No. 2792998) operate the ASK Italian and Zizzi Restaurant chains across the UK employing circa 4,700

employees across nearly 250 restaurants in the UK. The company changed its operational name in 2012 to Gondola Restaurants Ltd.

The company has been awarded a Dun & Bradstreet rating of 5A3 (greater than average risk of business failure).

30/06/2013 01/07/2012 26/06/2011 ASK RESTAURANTS LTD (£ 000s) (£ 000s) (£ 000s)

Turnover £193,947 £194,202 £193,348

Pre-tax Profit £4,897 £9,023 £16,997

Net Worth £141,386 £137,816 £130,453

Menzies LLP (Reg No. OC336077) are a private accountancy partnership, and are the largest UK member of HLB International, a leading international

accounting network. Menzies LLP provides various services including audit & assurance, corporate finance, corporate tax, forensic services, and business recovery. The company has offices in Woking, London, Whiteley, Egham, Leatherhead, and Farnborough. The company has been awarded a Dun & Bradstreet rating of N3 (greater than average risk of business failure).

MENZIES LLP 30/06/2013 30/06/2012 30/06/2011

Turnover £30,145,856 £28,435,635 £28,594,226

Pre-tax Profit £57,665 £661,017 £82,535

Net Worth (£328,130) £107,144 £80,118

Miller Fairclough Management Services (Reg No. 4375040) provide services in building projects, and is part of Miller Homes Ltd, the trading company for the house building division of Miller Group, as a result of Miller’s takeover of Fairclough Homes in 2005. At the time this created the 7th biggest housebuilder in the UK. The Miller Group has constructed over 100,000 homes since 1934 and is one of the largest house builders in the UK.

The company has been awarded a Dun & Bradstreet rating of H2 (lower than average risk of business failure).

MILLER FAIRCLOUGH 31/12/2012 31/12/2011 31/12/2010 MANAGEMENT SERVICES LTD (£ 000S) (£ 000S) (£ 000S)

Turnover n/a n/a n/a

Pre-tax Profit n/a £10,559 n/a

Net Worth n/a n/a (£10,559)

Nielsen Book Services Ltd (Reg No. 70437) provide market leading data services to over 100 countries worldwide, employing 120 staff in the UK. Their database comprises

information on published books from over 70 countries, and holds more than 23.8 million title records, available to booksellers, libraries and publishers.

The company has been awarded a Dun & Bradstreet rating of 1A1 (minimum risk of business failure).

NIELSEN BOOK SERVICES LTD 31/12/2013 31/12/2012 31/12/2011

Turnover £12,650,433 £12,763,614 £12,762,811

Pre-tax Profit £299,292 £1,854,045 £1,572,729

Net Worth £1,317,220 £1,854,045 £1,103,229

TENANT COVENANT


Tenant Covenant





Occupational Market

Woking has an estimated office stock of 2.7m sq ft, with circa 137,000 sq ft currently available to let in the town centre, reflecting a low vacancy rate of just 5.0%. This compares favourably against the M25 vacancy rate of 6.4%. Grade A / new space is exceptionally limited in the town centre, with only approximately 10,000 sq ft of Grade A / new space currently available.

Take up over the past 5 years has averaged approximately 142,000 sq ft per annum, largely accounted for by Grade A / new space within the town centre. The first half of 2014 has recorded a number of significant deals in response to rising levels of demand. When this is considered against the limited development in the town centre in recent years, it is widely expected Woking will experience significant rental growth and reduced incentive packages.

Prime rents in Woking currently stand at £27.00 psf, evidenced by the February 2014 letting to Clear Channel at Orion Gate. Woking represents excellent value in comparison to other South West M25 towns as demonstrated by the adjacent map.

We would highlight the following notable transactions that have recently taken place in the town centre:

OCCUPATIONAL MARKET

Date Property Tennant Sq ft Rent Paid/ psf

July 2014 Ground Floor, Dukes Court, Woking Lastminute.com 7,000 £24.00

March 2014 Goldvale House, Woking SAB Miller 7,960 £23.50 - £24.50

February 2014 31 Goldsworth Road Allianz 16,971 £23.50

February 2014 Orion Gate, Woking Clear Channel 9,353 £27.00

February 2014 1 Christchurch Way, Woking Mercer Ltd 19,283 £25.50

November 2013 Hollywood House, Church Street, Woking Financial Express. Ltd 8,763 £23.50

Horsham

Petersfield

Amersham

Hemel Hempstead

High Wycombe

LONDONIslington

Alton

Winchester

Eastleigh

Basingstoke

Newtown M3

M25

A3

A3

A3

A24

A23

A27

A31

A339

A33

A22A31

A331

M40

M4

M4

M3

M23

M25

M25

M1

7

212

4b15

1a16

55 miles

Heathrow

London City Airport


Gatwick

46 miles

Luton Airport

HorshamHH

Petersfield

Amersham

HemelHempstead

High Wycombe

ONONLONDONDOL OLOL ONIslingtonn

Alton

Winchester

Eastleigh

Basingstoke

Newtown M3

M25

A3

A3

A3

A24

A23

A27

A31

A339A

A33A

A22AA31

A331A3A3

M40

M4

M4

M3

M23

M25

M25

M1

7

212

4b15

1a16

55 miles

Heathrow

London City Airport


Gatwick

46 miles

Luton Airport

Richmond£43.50

St Albans£24.00

Guildford£30.00

Croydon£24.50

Watford£24.00

Weybridge£33.00 Esher

£35.00

Chiswick£50.00

Wimbledon£40.00

Staines£36.00

Slough£22.50

Maidenhead£32.00

Reading£33.50

Bracknell£21.50

Windsor£32.50

Hammersmith£50.00

Uxbridge£32.00

SOUTH EAST PRIME RENTS


Tenant Covenant





Occupational Market

SOUTH EAST OFFICE INVESTMENT TRANSACTIONS

The South East investment market in 2014 continues to perform robustly on the back of an impressive 2013 where circa £2.2 bn of offices across the region were transacted. We understand that 2014 has started strongly with £1.2 billion having been completed in the first 6 months, circa 25% above the 5 year average.

Investment yields for prime multi-let South East offices currently stand at circa 5.25% for towns with strong supply / demand characteristics. It is anticipated that, over the remainder of 2014, the weight of money in the South East office market will apply further pressure on pricing.

Multi-let opportunities in strong town centres, such as Woking, are rare, particularly where there is the genuine opportunity to capture rental growth. We would highlight the following key South East and Woking town centre deals that have taken place over the past year:

WAULT Size Rent Date Location Tenant (yrs) (sq ft) (per sq ft) Price NIY

September 14 Goldvale House, Multi-let 6.4 20,556 £21.64 £6.57m 6.40% Church Street West, Woking (4.1)

September 14 Dukes Court, Woking Multi-let 8.36 224,431 £19.72 c£62.0m c6.75% (7.70)

September 14 Chiswick Place, Multi-let 7.9 30,306 £25.38 £11.59m 6.25% 272 Gunnersbury Avenue, Chiswick (5)

August 14 80 Moorbridge Road, Maidenhead Multi-let 8.3 18,894 £21.88 £6.98m 5.60% (4.0)

August 14 Ealing Cross, 85 Uxbridge Road, Ealing Multi-let 7.08 134,582 c.£27.00 c.£38.0m 5.50% (4.88)

June 14 Meridien House, Multi-let 8 59,977 £19.91 £19.00m 5.90% 69-71 Clarendon Road, Watford (4.9)

June 14 The Lansdowne Building, Multi-let 5.5 109,335 £20.63 £31.50m 6.50% 204 Lansdowne Road, Croydon

February 14 Hollywood House, Multi-let 9 43,440 £23.50 £15.30m 6.30% Church Street East, Woking (4)


Tenant Covenant





Occupational Market

VATThe property is elected for VAT and it is anticipated that the sale will be treated as a Transfer of a Going Concern (TOGC).

EPCDetails, including certificates, are provided in the dataroom.

PROPOSALWe are instructed to seek offers in excess of £18,250,000 (Eighteen Million Two Hundred Fifty Thousand Pounds), reflecting an attractive Net Initial Yield of 6.75%, and a low capital value of £313 per sq ft, after allowing for standard purchasers costs of 5.80%.

SUBJECT TO CONTRACT & EXCLUSIVE VAT.

FURTHER INFORMATION Further information is provided in the dataroom. Access is available on request.

CONTACTSFor further information or to arrange a viewing, please contact one of the following:

Tom Woolhouse DDI 020 7312 7428 M 07818 012 428 E [email protected] James WinpennyDDI 020 7312 7455M 07818 012 455E [email protected]

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2265

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. September 2014.

PROPOSAL


Tenant Covenant





Occupational Market

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mailto:[email protected]

www.wildwoodcreative.co.uk

PRIME TOWN CENTRE MULTI-LET INVESTMENT … House Woking.pdf · INVESTMENT SUMMARY / Prime multi-let...

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