A PRIME MAYFAIR OFFICE AND RESIDENTIAL INVESTMENT OPPORTUNITY

Transcription

1 A PRIME MAYFAIR OFFICE AND RESIDENTIAL INVESTMENT OPPORTUNITY

2 BROOK STREET LONDON W1 INVESTMENT SUMMARY Prime Mayfair location, regarded as one of the West End of London s most prestigious office and residential addresses Rare opportunity to comprehensively refurbish/reposition a core Mayfair property to let in the open market or for owner occupation The property provides well configured modern floor plates with excellent natural light The floor plates of circa 2,000 sq ft are the most sought after size in Mayfair Multi-let to six tenants on flexible lease terms providing vacant possession by 24 June ,476 sq ft of office accommodation over lower ground, ground and 4 upper floors with 2,046 sq ft of residential accommodation on the 5th floor Long leasehold interest from Grosvenor (Mayfair) Estate expiring 24 December 2115 (approximately 102 years unexpired) with a current head rent of 39,800 per annum Net rent after deduction of head rent of 253,400 per annum Offers sought in excess of 18,000,000 (Eighteen Million Pounds) reflecting a capital value of 1,213 per sq ft

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4 ST. JAMES S PARK BROOK STREET LONDON W1 LOCATION COMMUNICATIONS Brook Street runs through the heart of Mayfair, one of the most exclusive districts in the West End of London. Mayfair is internationally recognised as Central London s most prestigious and sought after office location. Bounded by Oxford Street to the north, Regent Street to the east, Piccadilly to the south and Park Lane to the west, Mayfair sits in the core of London s West End. Mayfair is characterised by its attractive mix of period and modern buildings, providing a range of high quality office accommodation and residential dwellings. The desirability of this location to office occupiers is further enhanced by the high quality retail provision in and around Bond Street, South Molton Street and Mount Street. Luxury retailers include Louis Vuitton, Dunhill, Chanel and Christian Louboutin. Hotels and restaurants including Claridge s, The Connaught, Nobu, Cipriani and La Petite Maison are all located within a short walking distance. Mayfair s prestigious location has attracted a high number of corporate occupiers to the area including: Perella Weinberg Partners, Kleinwort Benson, BlueBay Asset Management, Qatari Diar, Blackstone, Condé Nast, Lazard and Estée Lauder. The property is very well served by public transport, being situated within a short walking distance (200m) of Bond Street Underground Station (Central and Jubilee lines) to the north, Oxford Circus (Bakerloo, Central and Victoria lines) to the north east and Green Park (Piccadilly, Jubilee and Victoria lines) to the south. Regular mainline train services from Paddington and Victoria provide rapid access to Heathrow and Gatwick airports, with services every 15 minutes. London City Airport and St Pancras International Station (from where Eurostar services to Continental Europe operate) are accessible within approximately 45 minutes and 10 minutes respectively. The Crossrail network is currently under construction and this will significantly improve communication links in the area. The new rail network, with an expected completion date of 2018, will provide high frequency and direct access to Heathrow in the west and Canary Wharf in the east. There will be direct commuter access through Central London with Crossrail stations at Paddington, Bond Street, Tottenham Court Road, Farringdon, Liverpool Street and Canary Wharf, increasing London s existing underground capacity by 10%. Bond Street s western ticket halls will be located only 100m from 73 Brook Street. Stratford Forest Gate Ilford Goodmayes Romford Harold Wood Shenfield PORTMAN PORTMAN ST MARBLE ARCH NORTH ROW ORCHARD ST JAMES STREET BINNEY STREET DUKE STREET GILBERT STREET BOND STREET SOUTH MOLTON STREET OXFORD STREET HANOVER ST ARGYLL STREET GT MARLBOROUGH STREET POLAND STREET BROADWICK STREET WARDOUR STREET BERWICK STREET Maidenhead Taplow Burnham Slough Langley Iver West Drayton Hayes & Harlington Heathrow Airport Southall Hanwell West Ealing Ealing Broadway Acton Paddington Bond Street Tottenham Court Road Farringdon Liverpool Street Whitechapel Maryland Canary Wharf Custom House Manor Park Woolwich Seven Kings Abbey Wood Chadwell Heath Gidea Park Brentwood CARNABY ST GREEN STREET PARK ST WOODS MEWS UPPER BROOK STREET CULROSS STREET REEVES MEWS SOUTH STREET BROOK STREET ADAM S ROW MOUNT ROW MOUNT STREET UPPER GROSVENOR STREET GROSVENOR STREET SOUTH AUDLEY STREET FARM STREET HILL STREET HAY S MEWS BROOK S MEWS DAVIES ST HAY S MEWS CHARLES STREET CURZON STREET BRUTON PLACE NEW BOND STREET HANOVER OXFORD CIRCUS LEXINGTON STREET PARK LANE HYDE PARK GROSVENOR BERKELEY BRUTON STREET BOLTON STREET CLARGES STREET MADDOX ST GRAFTON ST DOVER STREET BERKELEY STREET STRATTON STREET MILL ST CONDUIT STREET CLIFFORD ST ALBEMARLE STREET OLD BURLINGTON ST CORK STREET GREEN PARK SAVILE ROW BURLINGTON GDNS OLD BOND STREET KINGLY ST REGENT STREET ROYAL ACADEMY OF ARTS ST. JAMES S STREET WARWICK ST GOLDEN JERMYN STREET BREWER ST GLASSHOUSE ST PICCADILLY KING STREET DENMAN ST ST. JAMES S SHAFTESBURY AVE PICCADILLY CIRCUS REGENT STREET CHARLES II ST HAYMARKET QUEEN S WALK PALL MALL GREEN PARK ST. JAMES S PALACE THE MALL

5 OXFORD STREET BERKELEY GROSVENOR STREET GROSVENOR BROOK STREET LONDON W1 BOND STREET CLARIDGE S GREEN PARK THE CONNAUGHT HYDE PARK SITUATION Brook Street is prominently positioned within Mayfair, between Grosvenor Square to the west and New Bond Street to the east and one block north of Grosvenor Street. The property occupies a prime position on the south side of Brook Street, close to Grosvenor Square. Claridge s, the most iconic five star hotel in London, is situated on Brook Street 100m from the property. Many international banks, hedge funds, wealth management companies, law firms and embassies choose to locate on Brook Street and in the immediate area, attracted by the prestigious address and the amenities offered by the West End. 2 OU LB Moore Buildings 19 NNEY STREET RT STREET h Buildings 25 to to m 6 WEIGHHOUSE STREET 7 SOUTH MOLTON LANE DAVIES STREET krainian 1 to 5 Catholic athedral 22.0m WEIGHHOUSE STREET Hanover Flats 48 to 60 TA Centre 75 TCBs 1 to 12 ST ANSELM'S PLACE 23 TCB D Hanover Flats Hanover Flats 29 to PH to m 46 BINNEY STREET DUKE'S YARD 2 1 1a DUKE STREET to m m LB 23.1m Savile Club Cycle Hire 17 Station TCB Three Kings Yard PC Three Kings Yard Bank Memorial m 10m 20m 30m 38 to m 53

6 BROOK STREET LONDON W1 DESCRIPTION 73 Brook Street s prominence is enhanced by its significant frontage. The property comprises a multi-let office building arranged over lower ground, ground and four upper floors totalling 12,476 sq ft (1,159.1 sq m) with a 2,046 sq ft (190.1 sq m) residential flat on the fifth floor. At ground floor level the manned reception leads to a curved staircase and 2 passenger lifts providing access to all office floors. The ground floor offices can be accessed from an independent entrance on Brook Street. The lower ground floor offices, benefiting from excellent natural light, can be accessed via the main reception, or directly from the ground floor office. This allows the ground and lower ground offices to be let as a self contained unit. A ground floor double garage, accessed from 3 Kings Yard is located at the rear of the building. The specification of the open plan offices includes the following: Air-conditioning Fully accessible raised floors Suspended ceilings Two 6-person, 409kg passenger lifts WCs on each floor Concierge 2 secure car parking spaces

7 BROOK STREET LONDON W1 FLOOR PLANS LOWER GROUND FLOOR 2,256 SQ FT / SQ M TYPICAL FLOOR 2,074 SQ FT / SQ M PLANT VAULT GROUND FLOOR 1,806 SQ FT / SQ M FIFTH FLOOR 2,046 SQ FT / SQ M GARAGE SKYLIGHT PLANT RECEPTION Floor plans are not to scale. For identification purposes only.

8 BROOK STREET LONDON W1 ACCOMMODATION The property has been measured in accordance with the RICS Code of Measuring Practice (6th Edition). The approximate net internal floor areas are outlined below: FLOOR USE SQ FT SQ M 5th Residential flat 2, th Office 1, rd Office 2, nd Office 2, st Office 2, Ground Office 1, Ground Reception Lower Ground Office 2, TOTAL 14,834 1,378.1 TENURE The property is held long leasehold from Grosvenor (Mayfair) Estate for a term of 125 years commencing on 25 December 1990 and expiring on 24 December 2115 (approximately 102 years unexpired). The headlease terms are as follows: Freeholder: Grosvenor (Mayfair) Estate Lease Commencement: 25 December 1990 Lease Expiry: 24 December 2115 Term: 125 years (102 years unexpired) Current head rent payable: 39,800 per annum Permitted Use: Offices with residential on the 5th floor Review Date: 5 yearly intervals with the next review on 25 December 2015 Review mechanism: The revised rent is to be the aggregate of 2,050 plus 5% of the increase (if any) between 25,000 and the current full market value at the review date. TENANCY SCHEDULE FLOOR TENANT FROM/TO BREAK OPTION RENT PA AREA SQ FT COMMENTS Fifth Ian Philion 30/03/ /03/2014 Fourth Third Second Maslow Capital LLP Magyar & Co Ltd Amsterdam & Partners LLP Acropolis Capital Management Ltd The ECU Group Plc 01/04/ /06/ /02/ /09/ /11/ /09/2015 First ALMC HF 08/05/ /12/2014 Ground Txt Services Ltd 04/12/ /12/2014 Rolling Landlord break, 3 months notice Landlord on or after 25 December 2013 with 3 months notice Tenant - any time with 1 months notice Landlord - any time after 24 June 2014 with 6 months notice Mutual after 25 December 2013 with min 3 months notice Mutual after 8 November 2012 with min 3 months notice Mutual after 25 December 2013 with min 3 months notice 52,000 2,046 Outside the L&T Act. 80,000 1,971 Outside the L&T Act. 0 2,074 Outside the L&T Act. In the event of landlord activating break Acropolis entitled to receive a cash sum equivalent to the balance of headline rent in the sum of 117,070 per annum from the date of termination up to the lease expiry in September 2015 that would have been outstanding under their previous lease terms. SC capped at psf subject to annual increase in line with RPI. 66,450 2,215 Outside the L&T Act. SC capped at psf subject to annual increase in line with RPI 63,390 2,154 Outside the L&T Act. 31,360 1,806 Outside the L&T Act. Lower Ground Vacant 2,256 Outside the L&T Act. SUB TOTAL 293,200 Head rent 39,800 TOTAL 253,400

9 BROOK STREET LONDON W1 MARKET COMMENTARY Occupational Market Occupational confidence in the core West End office market remains high. There continues to be strong demand for new or refurbished units and especially those of 2,000-3,000 sq ft. Rents in excess of per sq ft are being achieved on the best quality office space in the most sought after locations. Rental growth is expected to resume in 2013 driven by the limited supply pipeline and low levels of availability throughout Mayfair as demand from tenants for the highest quality accommodation continues. Grade A vacancy in Mayfair and St James s stands at 4.1% against the ten year average of 4.4% and is forecast to reduce further due to the significant number of office to residential schemes that have or are being consented. Recent Mayfair leasing transactions are detailed below: DATE ADDRESS SIZE(SQ FT) FLOOR TENANT RENT ( PER SQ FT) LEASE TERM February Hanover Square, W1 7,614 5th Angola LNG years with break at 5 December Sackville Street 5,349 5th Gulfstream years August Burlington Gardens, W1 3,200 4th Lone Pine Capital years August Grafton Street 4,887 2nd Abraaj Group years with break at 5 August Hanover Square 1,654 5th & 6th Zais years with break at 5 Investment Market 2012 saw 5.8 billion invested in London s West End office market, the highest turnover since the financial crisis and the third highest on record. Investors have continued to concentrate on assets in core locations, relishing the opportunity to invest in this highly liquid and transparent market with strong rental growth prospects. Overseas investors accounted for circa 65% of all transactions in 2012 with overseas capital forecast to continue to flood into London. Investors are attracted by the quality of assets available, high quality tenants, limited supply pipeline and the favourable exchange rates available. West End prime office yields currently stand at 4.00% and have been at this level since The number of investors actively pursuing the limited number of assets being openly marketed will maintain pressure on prime yields. ADDRESS AREA (SQ FT) TENURE PRICE CV (PSF) NIY DATE *1 Grafton Street, W1 37,400 Freehold 80m 2, % February Grosvenor Street, W1 13,704 Long leasehold 17.6m 1, % December Berkeley Square, W1 52,000 Long leasehold 100m 1,923 N/A October Brook Street, W1 2,549 Freehold 5.53m 2, % October Upper Brook Street, W1 8,394 Freehold 14.3m 1,704 N/A May Curzon Street, W1 7,999 Freehold 13.0m 1,625 N/A March Savile Row, W1 14,010 Freehold 33m 2, % February 2012 * Reported to be

10 PLANNING The property is situated in the jurisdiction of Westminster City Council. It is not listed, but lies within the Mayfair Conservation Area. VAT PROPOSAL Offers are sought in excess of 18,000,000 (Eighteen Million Pounds) subject to contract and exclusive of VAT. A purchase at this level equates to 1,213 psf on the current net internal floor areas. The property is registered for VAT. EPC The property has an EPC rating of F. A full Energy Performance Asset Rating Certificate is available on request. For further information and access to the data room please contact: JAMES PARGETER D +44 (0) M +44 (0) E james.pargeter@montagu-evans.co.uk PAUL GUMMER D +44 (0) M +44 (0) E paul.gummer@montagu-evans.co.uk MISREPRESENTATION ACT 1967 & DECLARATION Misrepresentation Act 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. April Designed and produced by Cooper Rose

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