PRINCESS STREET MANCHESTER, M1 6DD MIXED USE FREEHOLD INVESTMENT OPPORTUNITY

Transcription

1 PRINCESS STREET MANCHESTER, M1 6DD MIXED USE FREEHOLD INVESTMENT OPPORTUNITY

2 INVESTMENT SUMMARY Attractive period building in Manchester city centre. Situated in a core office position and established bar and club circuit close to the multiple amenities of Oxford Street, Portland Street and Sackville Street. Mixed use investment configured as offices and two nightclubs. Accommodation of 3, sq m (39,810 sq ft) arranged over seven storeys. Total current passing rent of 74,68 per annum reflecting a low level of per sq ft overall on the let space. Office ERV of 14.5 per sq ft headline. Multi let to five tenants with an average weighted unexpired lease term certain of years. Significant opportunity to improve the income profile through letting of vacant accommodation. Freehold interest. Multiple asset management opportunities. Suitable for owner occupation. Seeking offers in excess of 3.5 million reflecting an attractive Net Initial Yield of 7.4%, Reversionary Yield of 14.1% and low capital value of 88 per sq ft.

3 LOCATION CATCHMENT & DEMOGRAPHICS One of the UK s top three cities and the regional centre for the North West, Manchester is located 311 km (193 miles) north of London, 138 km (86 miles) north of Birmingham, 55 km (34 miles) east of Liverpool and 71 km (44 miles) south west of Leeds. Manchester s transport network is a key contributor to its success, with almost unrivalled road communications and public transport facilities after London. The city is enviably positioned between the major north to south M1 and M6 motorways, each of which link to the M60 Manchester orbital route via the M6, respectively approximately 59.5 km (37 miles) and 14.5 km (9 miles) to the east and west. From the M60 multiple motorways link to the Greater Manchester area and beyond, including the M56, M61, M66 and M67, while numerous arterial routes serve M6 the surrounding area. BLACKPOOL M55 PRESTON BLACKBURN Five train stations serve the city centre, with Manchester Piccadilly providing direct access to London ( hours and 7 minutes), Birmingham (1 hour 5 minutes), Edinburgh (3 hours 11 minutes) and Glasgow (3 hours 11 minutes). The Metrolink Tram additionally offers excellent local accessibility via five separate lines, as do multiple bus routes. Manchester Airport provides significant international presence as the UK s third busiest airport, and the North s aviation hub. Flying to over 160 destinations across more than 60 carriers the airport handled close to 18.9 million passengers last year. Significantly, Easyjet are increasing their presence, further enhancing Manchester s A19 international reach. A1(M) M65 BURNLEY A59 A69 HALIFAX BRADFORD M606 A658 HARROGATE LEEDS M61 M1 M6 A59 A1(M) A64 M6 YORK A19 A64 M6 A166 Manchester s economic strength is strongly reflected in its annual Gross Value Added (GVA) of 46 billion, accounting for 40% of the North West s GVA, more than the North East s and Wales. Financial and Professional Services account for 0% of Greater Manchester s annual GVA making the city the UK s leading regional centre for the sector. Manchester is also the largest economic centre outside of London for the Creative and Digital sector with a GVA contribution of.7 billion. Greater Manchester s population of.68 million offers a skilled workforce of over 1.1 million, with 30% of the working population educated to a minimum degree level. With 100,000 people enrolled across five universities, and the largest student population in Europe, the city s attraction to major corporates is unsurprising. The Co-operative recently selected Manchester for their new UK Headquarters at One Angel Square, while Deloitte, KPMG and PWC also have significant presence. HULL LIVERPOOL M53 M57 M58 M6 ROCHDALE M6 M66 BURY M61 OLDHAM MANCHESTER M67 M6 M60 M56 HUDDERSFIELD A68 BARNSLEY M1 A635 A1(M) A61 ROTHERHAM M18 SHEFFIELD A1 M18 DONCASTER A1 SCUNTHORPE M180 A631 M180 A15 A46 GRIMSBY A16 M56 A61 M1 A57 M6 A54 CHESTERFIELD A57 LINCOLN CHESTER A34 A614 A1 A158 A61 SKEGNESS

4 SITUATION 101 Princess Street enjoys a core city centre position in the heart of the Design Quarter, an established office location for the Creative and Digital sector. Manchester Piccadilly Station is within 10 minutes walk, while the numerous amenities of Oxford Street, Portland Street and Sackville Street are in direct proximity. The building is additionally in a recognised leisure, bar and club circuit, only a short walk away from the multiple establishments along Canal Street with nearby occupiers including G-A-Y Manchester, Manto, Oscars and Alter Ego. Premier Inn, Ibis and Novotel hotels are also close by. The investment occupies a prominent island site along the eastern section of Princess Street between Portland Street and Whitworth Street. Principally surrounded by offices, McDonald Townhouse Hotel is to the west while St Peters Square Metrolink and Oxford Road Rail stations are both approximately five minutes walk away. Manchester Art Gallery is also nearby. T R I N I T Y W A Y B L A C K F R I A R S R O A D D E A N S G A T E V I C T O R I A E E S T R Q U A Y S T R E E T P E T E R S T R E E T L I V E R P O O L R O A D METROLINK STOPS 1 Manchester Victoria Station Shudehill Station 3 Market Street 4 Piccadilly Gardens 5 Mosley Street 6 St Peter s Square 7 G-Mex 8 Piccadillly B R I D G E S T R E E T SPINNINGFIELDS DEVELOPMENT 7 DEANSGATE STATION KING STREET WEST G R E A T B R I D G E W A M E D LO C K S T R E E T W H I T W O R T H T MEN ARENA C R O S S S T R E E T MANCHESTER VICTORIA STATION C O R P O R A T I O N S T R E E T F O U N T A I N S T R E E T A 5 7 ( M ) M A N C U N T H O M A S S T R E E T M A R K E T S T R E E T P I C CADILLY KING STREET EAST P R I N C E S S S 6 T E R STREET S T R E E T W E S T 1 ARNDALE SHOPPING CENTRE T R E E T OXFORD ROAD STATION PRINTWORKS PALACE THEATRE 5 O X F O R D S T R E E T NOMA DEVELOPMENT 3 T I B O L D H A M CANAL STREET S T R A Y TOUN STR E E T Y I A N W A S W A N S T R E E T E E T S T R E E T L O N D O N R O A D P O R T L A N D S T E E T N E W T O N S T R E E T W H I T W O R T H UPPER BROOK STREET 4 S T R E E T PICCADILLY STATION 8 N Map not to scale. For indicative purposes only.

5 DESCRIPTION 101 Princess Street comprises an attractive seven storey period building configured as office and nightclub accommodation. The offices are arranged over the upper levels, all of which provide highly flexible floorplates capable of multiple subdivision. The vendor has refurbished the second, third and fourth floors to a media style specification retaining period feature columns and exposed brickwork. Each level benefits from excellent natural light with windows to all elevations. Overall specification is broadly as follows: Air conditioning Central heating Oak flooring Underfloor trunking Wall and ceiling hung lighting Passenger lift WC facilities to all floors The dedicated office entrance on Princess Street and common parts have additionally been comprehensively refurbished. Two nightclubs comprise the majority of the ground floor and the lower ground level, with separate entrances from Silver Street and Major Street. Each is fitted out to an independent trading style.

6 ACCOMMODATION SECOND FLOOR We have been advised of the following Net Internal Areas: Floor Sq M Sq Ft Lower Ground and Basement* ,194 Upper Ground* ,34 First ,583 Second ,583 Third ,583 Fourth ,154 Fifth ,371 TOTALS 3, ,810 * Areas stated are GIA. FOURTH FLOOR Floor plans not to scale. For indicative purposes only.

7 N 60 Freehold. TENURE FAULKNER STREET REYNER STREET PH TCBs Po 95 PH 36 PH 90 9 PORTLAND STREET 4.7m Hotel Hotel Car Park Hotel m SILVER STREET MAJOR STREET Car Park 101 ABINGDON STREET PRINCESS STREET Imex House HART STREET 98 PH HARTER STREET WATERLOO STREET m New Union Hotel (PH) 0m 10m 0m 30m China House 111 For indicative purposes only. WIN

8 TENANCY The property is let in accordance with the below tenancy schedule which provides an Average Weighted Unexpired Lease Term Certain of years: Floor Lower Ground & Basement Size (Sq Ft) 8,194 Upper Ground 5,34 Tenant (Trading As) M Taylor, C Rigby (Cruz 101) Pot Cheetah Ltd (Satans Hollow) Lease Start Lease Expiry Rent Review Rent ( Pa) Rent ( Psf) Floor ERV ( Psf) 1-Jan Jan Jan , Comments 6-Nov Nov Sep , Lease guaranteed by J Royce. First 5,583 Vacant Second 5,583 Vacant 14.5 Third 5,583 Vacant 14.5 Part Fourth 1,80 CS Ltd 19-Feb Feb , Contracted outside the 1954 Act. Part Fourth 3,060 Inspired Gaming UK Ltd 3 3-May-01 8-Feb-015 4, Contracted outside the 1954 Act Part Fourth 814 Inspired Gaming UK Ltd 3 3-May-01 0-May-015 1, Contracted outside the 1954 Act. Fifth 4,371 Magnetic North Interactive Ltd 5-Dec Dec , Contracted outside the 1954 Act. TOTALS 39,810 74, Subject to refurbishment. CS removed their 013 break option. 3 Inspired Gaming have not activated their February 013 break option. 4 Overall rate across the let accommodation.

9 MARKET COMMENTARY Manchester s office takeup over the first three quarters of 01 totalled just under 480,000 sq ft, with activity mainly driven by the Business and Professional Services sectors. The TMT sector is however expected to be a key driver of demand going forward with its growth outstripping financial services, the BBC s move to MediaCity and a US technology consortium seeking occupation of 0 Grade A office buildings. The average transaction size over the third quarter of 01 was for accommodation of under 5,000 sq ft, matching well with the flexible sized suites which 101 Princess Street can offer. Recent transactions in the vicinity of the property are as follows: Building Floor Size (Sq Ft) Rent ( Psf) Lease Length 196 Deansgate Third 6, Years Dec-1 St James House, Oxford Street Part Fourth 1, Years Nov-1 St James House, Oxford Street Eleventh, Years Year 3 Nov-1 113/115 Portland Street First 1, Years Year 3 Nov-1 113/115 Portland Street First Years 3 Yearly Oct-1 Freetrade Exchange, Peter Street Fourth 5, Years Year 5 Sep Deansgate Part Third, Years 3 Years Jul-1 5 Princess Street Part Ground, Years 3 Yearly Jul-1 5 Princess Street Part Ground Years Jun-1 5 Princess Street Part First 3, Years Year 3 Apr-1 Churchgate House, Oxford Street Ground 6, Years Year 5 Mar-1 Based upon the above and recent activity at 101 Princess Street we believe an appropriate headline office ERV to be 14.5 per sq ft. Break Date ASSET MANAGEMENT OPPORTUNITIES The investment benefits from multiple asset management opportunities: Refurbish the first floor accommodation. Reduce vacancy and significantly improve the income profile. Potential change of use of the whole or parts of the building to include hotel, apart hotel, serviced apartments and leisure, subject to the necessary consents.

10 COVENANTS CS LTD CS is a national chartered surveying firm with six UK offices. Employing over 40 staff CS s clients include Aviva, Coca Cola and Tesco. Further information is available at their website INSPIRED GAMING UK LTD Inspired Gaming are the leading global provider of server based gaming, offering both software and hardware gambling products. Operating in countries, Inspired were acquired by Vitruvian Private Equity Partners in 010. Further information is available at their website MAGNETIC NORTH A specialist digital design company, Magnetic North offer website and apps design services in addition to creation and installation of digital platforms. Clients include BBC, Google and Manchester Visitor Centre. Further information is available at their website SATANS HOLLOW One of Manchester s key alternative nightclub venues, Satans Hollow has an established rock following within Manchester and beyond. CRUZ 101 Running for over 0 years Cruz 101 is one of Manchester s core gay clubs having been the first venue of its type in the city. Cruz 101 has an excellent following with other similar clubs opening in the surrounding area following its success.

11 SERVICE CHARGE & RATES LIABILITY VAT The current service charge budget for the year ending 31 March 013 equates to.50 per sq ft overall. Due to the building s Grade II listed status no empty rates are payable on the property. The property has been elected for VAT which will therefore be payable upon the purchase price. It is envisaged that the sale will be treated as a Transfer Of a Going Concern.

12 This certificate has been produced by E P C g e n, a software module developed by B R E for C L G under contract with F M. The author of the program is J o s e O r t i z (o r t i z b r e. c o. u k ). Some security features proves the authenticity of this document. SK S K D C L G x E P C g e n INVESTMENT CONSIDERATIONS PROPOSAL FURTHER INFORMATION Attractive mixed use period building in Manchester city centre. Substantial refurbishment already undertaken to the majority of the office space. Highly flexible floorplates capable of multiple subdivision or individual occupation. We are instructed to seek offers in excess of 3.5 million ( 3,500,000) subject to contract and exclusive of VAT, reflecting an attractive Net Initial Yield of 7.4%, Reversionary Yield of 14.1% and low capital value of 88 per sq ft. For further information please contact: SIMEON COHEN simeon@dbaprop.co.uk DAVID BAROUKH david@dbaprop.co.uk Mixed use opportunity with approximately 55% secured for minimum unexpired terms of just under 7 years. Low average passing rent of 13.4 per sq ft on the let office accommodation. Opportunity to let the vacant space and significantly improve the income profile. Empty rates exemption as a Grade II listed property resulting in minimal void costs. Potential for change of use over part or the whole of the building subject to the necessary consents. Suitable for owner occupation. Low capital value of 88 per sq ft. More energy efficient A+ A 0-5 B 6-50 C D E F G Over 150 Less energy efficient EPC Energy Performance Certificate Non-Domestic Building 101 Princess Street MANCHESTER M1 6DD Energy Performance Asset Rating Technical information Main heating fuel: Building environment: Total useful floor area (m ): Building complexity (NOS level): 3 Natural Gas Heating and Natural Ventilation 4397 Net zero CO emissions 71 Certificate Reference Number: This certificate shows the energy rating of this building. It indicates the energy efficiency of the building fabric and the heating, ventilation, cooling and lighting systems. The rating is compared to two benchmarks for this type of building: one appropriate for new buildings and one appropriate for existing buildings. There is more advice on how to interpret this information on the Government s website This is how energy efficient the building is. Benchmarks Buildings similar to this one could have ratings as follows: If newly built If typical of the existing stock MISREPRESENTATION CLAUSE DAVID BAROUKH ASSOCIATES 6A Wimpole Street, London W1G 8AL Tel: Fax: DOMINIC EVANS devans@matthews-goodman.co.uk ROB PEILL rpeill@matthews-goodman.co.uk MATTHEWS & GOODMAN Centurion House, 19 Deansgate, Manchester M3 3WR Tel: Fax: David Baroukh Associates LLP for themselves, their Associated Companies, their employees and for the vendors or lessors of the properties whose agents they are give notice that: 1. All particulars or properties provided are given as a general outline only for the guidance of intending purchaser, lessee or tenant, and do not constitute, nor constitute part of, an offer or contract.. Whilst all particulars of properties given including but not limited to descriptions, dimensions, references to condition and necessary permissions for use and occupation and maps are believed to be correct and are given in good faith, they are however given without responsibility on the part of David Baroukh Associates their Associated Companies, their employees and or the vendors or lessors as the case may be. 3. None of the statements contained in any particulars is to be relied upon as a statement or representation of fact. 4. Any intending purchaser or lessee or tenant should not rely on any particulars provided by us and must satisfy themselves by inspection or otherwise as to the correctness of each statement made in such particulars. 5. The vendor or lessor (as the case may be) do not make or give and neither David Baroukh Associates LLP, their Associated Companies or any person in their employment have any authority to make or give any representation or warranty whatever in relation to any properties. February 013 Further information available on request impact / (E1535/WH)