Tavern Street, Ipswich - £4.719m, 6.85%
Acting on behalf of Columbia Threadneedle, CWM acquired this prime high street retail parade in the heart of Ipswich’s retail core. The vendor was M&G Investments and the off-market transaction was concluded after lengthy discussions straddling the June 23rd ‘Brexit’ Referendum.
The parade comprises 6 high street shops with ancillary upper parts, producing a total income of £344,500 p.a primarily from national multiple occupiers. This holding also forms an integral part of a property ‘jigsaw’, with the same client already owning high street retail assets on either side of this parade.
The freehold was purchased for £4,719,000, reflecting a net initial yield of 6.85%.
Andrew McDonald commented: “Investor sentiment in Ipswich has increased notably with the refocussing of the long-proposed Mint Quarter development. The retail landscape of the city is now looking more settled and occupational demand tangible. By concluding this transaction, the client has ‘linked’ together existing retail holdings and created a substantial, contiguous, retail parade. This is astute Fund Management, as sizeable multi-let high street parades of this nature are relatively rare and tend to command premium prices. It was the first purchase by this particular fund within Columbia Threadneedle since the Brexit Referendum vote.”
For further information please contact Andrew McDonald or Jamie Whitelaw.
Pride Hill & High Street, Shrewsbury - £10.3m 6.07% NIY
Acting on behalf of Custodian REIT plc, CWM advised on the investment purchase of this prime parade of 8 shops.
The property comprises an attractive block located in the busiest section of Shrewsbury’s prime pitch, at the corner of High Street and Pride Hill. Much of the property had been completely redeveloped behind the period facades in 1992 and as such it provides well configured accommodation in the best location in this historic town. Tenants include Edinburgh Woollen Mill, Ask, Paperchase, Greggs, Holland & Barrett, Whittard and William Hill.
Julian Norbury commented: “This purchase at £10.3m reflected 6.07% net initial yield. Much of the property was rack rented (with rents in Shrewsbury having fallen from £135 ITZA to around £105). These rents are very affordable and with a long lease to Ask, this rack rented parade should perform well in the future. The corner location and vacant upper parts may also provide the opportunity to create an attractive flagship store in the longer term.”
For further information please contact Julian Norbury
High Street, Chelmsford - £3.575m 5% NIY
Acting on behalf of a private British client, CWM acquired this prime high street unit in Chelmsford, from Colliers Capital.
The unit is let to Paperchase Products Ltd on a 15 year lease from 2nd November 2009.
The freehold interest was purchased for £3,575,000, reflecting a net initial yield of 5%.
Jamie Whitelaw commented: “Chelmsford has recently seen the new arrival of a John Lewis and the accompanying retail and leisure which is due to increase the yearly spend within the city by £690m annually. This off-market opportunity offered our client strong income with 8 years unexpired to Paperchase and also the potential rental growth from an ever expanding city in an excellent south east location.”
For further information please contact Jamie Whitelaw.
Sainsburys, Earlsfield - £7.4m 4.41% NIY
Acting on behalf of London Borough of Wandsworth Council, CWM acquired this prime food store in the affluent Greater London Suburb of Earlsfield, from M&G Investments.
The unit is let to Sainsburys Supermarkets Ltd on a 15 year lease from 27 July 2009 with RPI uplifts collar and capped at 2%-5%.
The long leasehold interest was purchased for £7,400,000 reflected a net initial yield of 4.41%.
Jim Remfry commented: “The London Borough of Wandsworth were looking to add some core income to their portfolio, and this well let food store investment, located in their borough was the perfect fit”.
For further information please contact Jim Remfry.
The Precinct, Coventry - £31.1m 7.94% NIY
Acting on behalf of Aviva Investors, CWM marketed this complex long leasehold mixed city centre estate, selling it after a competitive bids process to The European Opportunistic Property Fund III, advised by the European Global Real Assets Group of JP Morgan Asset Management.
The property comprises a long leasehold estate of 33 shops in Coventry city centre. It totals approximately 81,500 sq ft and is held long leasehold from Coventry City Council with around 122 years unexpired (including a right to renew) at a side by side gearing of 8.50%.
Given the complexity of the asset, CWM presented it via a bespoke online data site containing extensive due diligence and appraisal material. The property was brought to the market in the immediate aftermath of the European Referendum and was seen as a bellwether for how the investment market was going to react to the unexpected outcome of the vote for Brexit. After an intensive marketing process, bids were invited in mid August. Five first round bids were received indicating a very encouraging £150m+ of pent up demand for this type of asset.
The property was sold via a simultaneous exchange and completion of contracts in October 2016 for £31,100,000 which reflected a net initial yield of 7.94%, an equivalent yield of 7.76% and a reversionary yield of 8.21%.
John Miles commented: “This was a fantastic result in the immediate aftermath of the Brexit vote. It demonstrated an impressive volume of demand for well-presented retail investments in what was a challenging period of economic uncertainty”.For further information please contact John Miles or Julian Norbury.
North End, Croydon - £6.05m 4.65% NIY
Acting on behalf of Avignon Capital, CWM acquired this portfolio of reversionary prime mixed use properties from M&G Investments after a competitive bids process.
The portfolio comprises 3 single let high street shops with residential flats above, producing a total gross income of £278,120 p.a.
The freehold of all 3 properties was purchased for £6,050,000 which assuming a total capital value of £1,675,000 on the residential, reflected a blended a net initial yield on the commercial income of 4.65% and an overall blended yield of 4.31%.
Ben Simpson commented: “With the ongoing displacement of tenants from the Whitgift and Centrale shopping centres due their imminent redevelopment, demand from retailers looking to maintain their representation in Croydon has dramatically increased. Requirements for new shops on North End is currently far outweighing the supply, with Zone A rents in turn rising dramatically. All 3 shops acquired have upcoming rent reviews upcoming over the next 2 years with excellent reversionary prospects. With a 15 minute direct rail service to Central London and exciting £1.4bn plans to regenerate the town centre’s retail core, the client who is actually already a home owner in Croydon believes residential prices are well positioned to increase even further”.For further information please contact Ben Simpson.
Western Road, Brighton - £4.85m 5.71% NIY
Acting on behalf of Aberdeen Asset Management, CWM has disposed of this substantial freehold unit, situated in a prime location on Western Road, Brighton for £4,850,000.
The premises are let on one lease to Poundland for a further 9 years at a rent of £295,000 pa. The unit benefits from a prominent return frontage along Church Street with a secondary entrance into the upper and lower levels. With much of the upper parts under- utilised by Poundland, the unit seems to present significant asset management potential through taking control of these levels and converting to other uses, subject to planning.
Despite challenges presented by the Brexit result, the sale to a local investor concluded ahead of the guide price of £4,815,000 / 5.75% NIY after a best bids process.
Andrew McDonald of CWM commented: “Freehold property such as this with asset management potential are keenly fought after and top-tier towns such Brighton always command a loyal following. Using our extensive contact network, we were able to secure a local purchaser who performed very well through the deal”
For further information, please do contract Andrew McDonald or Jamie Whitelaw
Gulf Petrol Filling Station, Aberdeen - £1.25m 6.44% NIY
Acting on behalf of our clients of Whiteknight Properties, CWM advised on the successful disposal of this petrol filling station investment let to Certas Energy.
The subject property, located in the Aberdeen suburb of Dyce, is adjacent to Aberdeen Airport and comprises a petrol filling station (PFS) on a circa 0.66 acre site. Situated on Argyll Road at its junction with Dyce Drive, the site benefits from significant through traffic to the main terminal and parking of Aberdeen Airport to the north via Argyll Road.
It was held long leasehold (164 years at a peppercorn). Certas Energy, trading as Gulf, have taken a new 20 year lease at £85,000 per annum. The purchase price of £1.25m equated to a net initial yield of 6.44%.
Jamie Whitelaw commented: “The sale of this property showcases CWM’s versatility in advising across a broad spectrum of retail real estate investment subsectors.”
For further information please contact Jamie Whitelaw or our joint sole agent Ken Shaw at Ryden (01224 569664).
The Courtyard, Cheltenham - £4.65m 6.10% NIY
Acting on behalf of Avignon Capital, CWM advised on the investment purchase of this boutique retail and leisure courtyard in the fashionable Montpellier district of Cheltenham.
Located in a prominent position at the northern end of Montpellier Street, this mid 1980’s freehold development comprises a modern purpose built scheme with shopping on two levels, covered walkways and a sunken piazza.
The 12,086 sq ft courtyard is let to 16 tenants – mainly a variety of high-end independent retailers and local restauranteurs. At the time of purchase, the scheme was fully let at a contracted income of £302,501pa with no voids or irrecoverable costs. The property benefitted from a WAULT to tenant break of 3.90 years and 5.40 years to expiry.
Ben Simpson commented: “This purchase at £4.65m reflected 6.10% net initial yield. The client, who already owns elsewhere in the town, was looking to increase their holdings in the area. With several unsatisfied A3/A4 requirements for Cheltenham and the Montpellier area in particular, the client is eager to draw on the desirability of the town to create a high-end retail and leisure destination. With John Lewis set to open its doors in the former Beechwood Shopping Centre in 2017, the ongoing extension to the Brewery Leisure Scheme and a vast pedestrianised program proposed for the town centre - retailing in Cheltenham is set to benefit enormously”.
For further information please contact Ben Simpson or Jamie Whitelaw
Reiss, London - £18.75m 3.32% NIY
Reiss’s Kings Road flagship at is arguably the most prominent shop on the prime part of this iconic street, occupying a south facing corner position at the junction of Tryon Street, some 75 yards west of Sloane Square. Its frontage projects forward from the surrounding building line, giving it its unique prominence. Brands situated nearby include Joseph, Brandy Melville, Calzedonia, Russell & Bromley, Calvin Klein, & Other Stories, L’Occitane, Hobbs and Petit Bateau.
The property comprises a fine four storey double fronted Georgian building with classical proportions. The commercial element extends to some 7,100 sq ft and is arranged as a ground and basement retail store with a physiotherapy clinic on three floors above. In addition, there are two residential flats at second and third floor which were sold off on long leases.
Reiss (Retail) Limited held the premises on a 20 year FRI lease expiring 21st May 2018 at a passing rent of £665,000 per annum.
CWM were tasked to effect a swift sale of the property and produced marketing particulars and agreed terms for the sale within two weeks of receiving instructions.
The property was sold for a price of £18,750,000 which reflected 3.32% NIY.
For further information please contact John Miles or Julian Norbury.
Fargate, Sheffield - £3.26m 6.66% NIY
We were instructed by Standard Life Investments to sell this prime retail unit let to Next on Fargate, Sheffield. The property is arguably the most prominent shop on Fargate, situated on its east side on the corner with Norfolk Row. This location is 100% prime and other retailers situated nearby include Marks & Spencer, Vision Express, Topshop, WH Smith and H&M.
The property comprises a 3 storey corner unit with the benefit of a long return frontage onto Norfolk Row. The tenants trade from the basement, ground and first floors and there is additional storage at second floor level. The net internal area totalled some 6,800 sq ft.
The property was let in its entirety to Next Group plc on a 5 year lease at a rent of £222,500 per annum. The term certain at the time of sale was short; the lease having only approximately 2 years unexpired. The rent was ‘rack’, reflecting approximately £164 psf ITZA.
CWM marketed the property and went under offer with a purchaser before the June 2016 European Referendum. ‘Post Brexit’ negotiations ensued and the sale was kept on track, eventually completing at a price of £3,260,000. The sale reflected a competitive net initial yield of 6.66% NIY and a 6.36% nominal equivalent yield. John Miles of CWM commented: “This was one of the first high street retail investment sales to complete after the Referendum and it reassured the market that there was indeed ‘life after Brexit’”.
For further information please contact John Miles.
Park View Shopping Centre, Whitley Bay - £7.5m 10.08% NIY
Acting on behalf of Cordatus Real Estate (Jersey) GP Limited as General Partner of the Cordatus Property LP, CWM acquired this shopping centre investment in the popular north east seaside town of Whitley Bay.
The property comprises a modern, covered shopping mall with decked car parking above. It was constructed in 2004 and dominates the town’s shopping provision. It totals some 45,000 sq ft arranged as 16 retail units. The income was approximately 85% multiple and car parking with tenants including Sainsburys, Iceland, Boots, Costa, Thorntons and Superdrug. The tenancies had a weighted average unexpired term of approximately 3.00 years at the time of purchase.
The negotiations for the property spanned the surprise result of the Referendum vote in June 2016. This, together with the discovery during the due diligence process of some defects to the roof deck, enabled the price to be renegotiated and the property was eventually secured for £7,500,000 from the administrators, reflecting a very attractive net initial yield of 10.08%, a nominal equivalent yield of 9.95% and a reversionary yield of 10.16%.
John Miles commented: “To have secured a modern property let to this quality of tenant mix for a double digit yield was a great result for our clients. The centre dominates the town’s shopping and functions well as a convenience shopping destination for the local population”.
For further information please contact John Miles or Ben Simpson.
Old Bond Street & Trim Street, Bath - £6.75m 5.10% NIY
Acting on behalf of Aberdeen Asset Management, CWM surrender leasehold interest of this prime city centre shop back to the Freeholders.
The investment, which sits in prime position in central Bath, was held on a 91 year leasehold basis and subject to a 10% pay-away. The unit is occupied by Russell & Bromley on a short occupational lease to expire in May 2018, being under 2 years from date of marketing commencement.
Russell & Bromley occupied the premises on an over-riding basis, with sublet income attributable towards the office located at 6/7 Trim Street. There is a further office on Old Bond Street, again under the lease of Russell & Bromley, but unoccupied.
The rent reserved to Russell & Bromley was £410,000 pa (£369,000 pa after pay-away) and, after competitive bidding, the leasehold was surrendered for a consideration of £6,750,000 (ex VAT) reflecting a Net Initial Yield of just over 5.10%.
Andrew McDonald commented: “This was a pleasing result in the immediate aftermath of the Brexit result. It demonstrates the resilience of prime high street retail, including assets that present inherent challenges”
For further information please contract Andrew McDonald or Jamie Whitelaw
High Street, Southampton - £5.2m 9.00% NIY
CWM has disposed of this substantial long leasehold investment, situated in an edge of pitch location on High Street, Southampton.
The premises, comprising a former department store, are multi let under a variety of leases, with primarily multiple income including Tesco and Argos. The majority of income is attributable toward A1 retail use, however Southampton Solent University are liable for 15% of the income with ‘The Gym’ are further 20%. To the rear of the premises, on Castle Way, a secondary entrance is located leading up to the University accommodation and a further 19,000 sq ft of vacant space over third and fourth floor. As part of the marketing initiatives, CWM located a hotel operator who expressed interest in the space therefore offering potential valuable ‘upside’ to the purchaser.
Andrew McDonald of CWM commented: “This leasehold property is a classic risk and reward investment, offering the bold entrepreneur plenty of opportunity to add value through an aggressive hands on approach. The retail pitch in Southampton consolidated post opening of West Quay and, while now improving, this section of High Street has faced its challenges. We were pleased therefore to dispose of this property via a best bids situation which revealed a variety of entrepreneurial investors.”
The sale concluded close to the guide price of £5,200,000 / 9.00% NIY.
For further information, please contract Andrew McDonald
Reindeer Court, Worcester - £4.2m 9.96% NIY
Acting on behalf of a private family trust, CWM advised on the investment purchase of this attractive speciality arcade.
The investment, which sits in a busy secondary location in central Worcester is held Freehold and comprises a part listed Arcade of 40,400sqft in 31 shop units. The arcade provides an attractive link between the rear of Marks & Spencer on The Shambles going through to Mealcheapen Street and the new Asda development the otherside of City Walls Road.
Julian Norbury commented: “This purchase (in my home town!) at £4.2m reflected 9.96% net initial yield. The client was looking to maximise their income return and the granular nature of this income combined with a modest level of post purchase debt should, with the right management input, provide our client with both a steady income and high returns.”
For further information please contact Julian Norbury
Sloane Avenue, Chelsea - £3m 3.84% NIY
Acting on behalf of clients of Dorrington plc, CWM advised on the successful investment purchase of this shop let to Douglas & Gordon.
The investment sits in an attractive Chelsea side street, off the Kings Road. The property formed part of a parade already in our client’s ownership. It was held virtual freehold (974 years at a peppercorn) over ground floor and basement let at £122,500. Douglas & Gordon’s owners were undertaking a sale and leaseback. The purchase price of £3m equated to a net initial yield of 3.84%.
Julian Norbury commented: “The client was delighted to add to their holding here in the heart of Chelsea. The property comprises a strong lifestyle and service pitch off modest rents.”
For further information please contact Julian Norbury
Monument Mall, Newcastle - £75m 4.29% NIY
CWM acquired this 100% prime city centre retail holding for Standard Life UK Property Fund.
The property is the result of the substantial redevelopment of the former Monument Mall shopping centre. It now comprises the most prominent single ownership retail block in Newcastle city centre outside of the Intu shopping centre. It sits on an island site at the junction of Blackett Street and Northumberland Street in the middle of the prime shopping loop created by the entrances to the Intu centre. It totals some 132,000 sq ft and is let to 14 shops and 2 restaurants.
On its eastern side, its Northumberland Street frontage is in the prime section of the street where retailers include Fenwick, H&M, WH Smith and Five Guys. On its southern side, its Blackett Street frontage has now become the focus of high quality aspirational retailing in Newcastle city centre. Tenants in the property include Reiss, Hugo Boss, White Company, Michael Kors, Kiehls, Molton Brown and Jack Wills.
The freehold of the property was purchased from Hammerson for £75,000,000 (Seventy Five Million Pounds), reflecting a net initial yield of 4.29%, a nominal equivalent yield of 4.68% and a reversionary yield of 4.77%. John Miles of CWM commented: “A high street block of this size and quality only comes along very rarely – perhaps once a year or less. For institutions looking for this scale of investment, the answer is most usually shopping centres and ones of this size are often secondary. Investments like this are very rare beasts.”
For further information please contact John Miles.
High Street, Winchester - £5.4m 4.7% NIY
BMO Real Estate Partners, advised by CWM, have purchased 106a & 106b High Street, Winchester in an off-market deal from a private investor for £5,400,000. The price reflected a net initial yield of 4.66%.
The two shops, located in 100% prime pitch, will be let to Mint Velvet for a further nine years and Specsavers for a further six. Both options will offer secure income against two well-regarded high street multiple retailers. The average weighted unexpired lease term (AWULT) on the property is 7.84 years. The passing rent of £266,000 per annum is reversionary and rents continue to grow in Winchester amongst low vacancy rates and strong occupational demand.
The purchase price of £5.4 million reflects an attractive Net Initial Yield of 4.7% with a Reversion to 4.9%.
For further information, please contact Andrew McDonald or Jamie Whitelaw