Prime, Reversionary, High Street Retail Investment. 81 Broadmead, Bristol BS1 3DT

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2 INVESTMENT SUMMARY Bristol is ranked one of the top 10 retail centres in the UK. A prime retail investment, on Broadmead within close proximity to the main entrance of the The Galleries. An established retailing pitch where national retailers include Tesco Metro, The Carphone Warehouse, Marks & Spencer, Sainsbury s Local, Accessorize, Flight Centre, Boots, EE and Card Factory. Well secured to the strong covenant of Shoe Zone Retail Limited for an unexpired term of 4.75 years. Long leasehold ( years unexpired). A passing gross rent of 75,000 per annum and a net rent of 72, per annum after head rent deduction. Offers in excess of 1,012,000 (Subject to Contract & exclusive of VAT) which reflects a net initial yield of 6.75%, reversionary yield of 7.28% and a nominal equivalent yield of 7.12%, assuming purchasers costs of 5.8%. 2

3 LOCATION Bristol is the largest city in the south west of England and is located approximately 120 miles (193 km) west of London, 80 miles (128 km) south of Birmingham, 78 miles (125 km) north east of Exeter and 50 miles (80 km) east of Cardiff. The city is strategically located and benefits from excellent road communications being situated just south of the intersection of the M4 and M5. The M5 provides direct access to Birmingham to the north and Exeter to the south whilst the M4 provides access to London to the east and Cardiff to the west. In addition, the city benefits from 2 railway stations; Temple Meads which provides a fastest journey time to London Paddington in 1 hour 40 minutes and Parkway which provides a fastest journey time to London Paddington in 1 hour 20 minutes. Bristol International Airport is located approximately 8 miles south of the city centre and provides a range of international and domestic flights. The Airport Flyer Express is a bus service from Bristol Temple Meads in a journey time of 30 minutes and leaves up to 10 minutes every day 24/7. DEMOGRAPHICS Bristol has a total population within its primary catchment of 962,000 ranking the city the 10th largest in the UK on this measure and has an estimated shopping population of 497,000. Bristol is projected to see above average growth in population over the period The city centre draws shoppers and spending from beyond the primary catchment area, particularly to the east and south. In total, VisitEngland estimates that there were 1.51 million visitors to the city in 2013, generating spend in the region of 252 million. In 2011 the service sector accounted for 83% of total employment in Bristol with financial and business services accounting for 34% of total employment. Key finance and insurance firms within the city include Friends Provident, Allianz Insurance, RAC Insurance, Lloyds Banking Group, Barclays and NatWest. As well as the service sector, Bristol claims to have the largest cluster of computer chip designers and manufacturers outside Silicon Valley. The wider region has one of the biggest aerospace hubs in the UK, centred on Airbus, Rolls-Royce and GKN at Filton airfield. In addition, Bristol has 2 major universities, University of Bristol and the University of the West of England which combined accommodates over 50,000 students. RETAILING IN BRISTOL Bristol s central shopping area comprises an estimated 2 million sq ft of retail floor space, which ranks the city 16th in the UK on this measure. Bristol central shopping area was transformed by the completion of Cabot Circus in This development provides in excess of 1 million sq ft of modern retail and leisure accommodation together with a 2,500 space car park. It has attracted many new retailers to the city including Harvey Nichols and a large variety of national aspirational retailers such as Zara, The White Company, Reiss, French Connection, Apple, Hugo Boss, Joules and Urban Outfitters. The scheme also benefits from a Showcase de Lux Cinema, a restaurant quarter and residential apartments. The Bristol catchment population is moderately affluent containing a significantly above average proportion of adults of working age categorised within the most affluent AB social group. Social group C1 is also overrepresented whilst the least affluent social groups D and E are particularly under-represented. BRISTOL 3

4 The other main shopping centre is The Galleries which is situated at the western end of Broadmead, with the main entrance adjacent to the subject property. It benefits from a variety of national retailers including Boots, WH Smith, Peacocks, The Perfume Shop and Hawkin s Bazaar. Broadmead remains a prime retailing location within the town centre where the key anchor retailers are represented such as Boots, Marks & Spencer and BHS. The Horsefair runs parallel to and north of Broadmead where Debenhams department store is located as well as Primark s regional flagship store at just under 100,000 sq.ft. SITUATION The subject property is located in a prime retail destination on the western end of Broadmead, situated in a prominent position opposite Marks & Spencer, Sainsbury s Local and Three. Other national retailers in close proximity include Tesco Metro, The Carphone Warehouse, Accessorize, Foot Locker, Flight Centre, Boots, EE and Card Factory. This location benefits from significant footfall as a result of a large number of office buildings and residential dwellings located nearby. The amount of residential accommodation in the area is also set to increase further as a result of a number of major building and conversion projects nearby. Sites include the former Police Station, the Magistrates Court, Lewins Place, Froomsgate House and Westgate which, between them, will add 1,000 new apartments to the immediate vicinity over the next few years. THE PROPERTY The property provides well configured sales accommodation on ground floor with ancillary accommodation on the first and second floors. ACCOMMODATION The property comprises the following net internal floor areas: Floor Area (Sq. m.) Areas (Sq. ft.) Ground Floor Sales ,887 Ground Floor ITZA units First Floor Ancillary Second Floor Ancillary TOTAL ,818 TENURE In common with Bristol s central shopping area, the property is held Long Leasehold from The City Council of Bristol, for a period of 125 years from 22nd August 1996 ( years unexpired). The current head rent is the greater of 2, per annum or 2.5% of net revenue. 4

5 Prime, Reversionary, High Street Retail Investment ne Zo oe Sh This Goad Plan is for identification only and not to be scaled as working drawing. No part of this plan may be entered into an electronic retrieval system without prior consent of the publisher. Crown copyright Licence number PU For full terms and of copyright conditions visit ç ç è è 5

6 TENANCY The property is let in its entirety to Shoe Zone Retail Limited on a new 5 year, full repairing and insuring lease from 21st October The passing rent is 75,000 per annum and the tenant benefitted from 12 month s rent free which will be topped up by the vendor. The net rent after head rent deduction is 72, per annum. Shoe Zone was founded in 1917 under the name Bensonshoe and was acquired by the Smith family in Since then the company has acquired a number of businesses namely Tylers in 1986, The Oliver Group Plc in 1986, Shoefayre in 2007 and Stead & Simpson in The shoe retailer has over 500 stores within the UK and Republic of Ireland with over 4,000 employees. Company Name Date of Accounts D&B Rating Sales Turnover Profit before Tax Net Current Assets Shoe Zone Retail Limited 04/10/2014 4A 1 172,861,000 11,677,000 28,403,000 RENTAL ANALYSIS We calculate that the current passing rent equates to Zone A headline reflecting a rebased rent. The historic prime Zone A rate in the west end of Broadmead was 180 psf. The pitch has experienced a considerable decline in rents since the opening of Cabot Circus however rents have since stabilised and created a good platform for rental growth. A number of recent transactions are set out in the below table: Address Tenant Date Transaction Rent (Headline ITZA) 57 Broadmead Sally Salon Jun 2015 OML Broadmead Three Feb 2015 LR Broadmead Sainsbury s Local Apr 2014 OML Broadmead Pret A Manager Oct 2013 OML Broadmead Flight Centre Jan 2013 OML We believe the property is reversionary with an estimated rental value of 80,700 pa reflecting 95 Zone A. EPC An EPC is available upon request. VAT The property has been elected for VAT and any disposal will be by way of a Transfer of a Going Concern (TOGC). PROPOSAL We have been instructed to seek offers of 1,012,000 (One Million and Twelve Thousand Pounds), Subject to Contract & exclusive of VAT. The net rent of 72, reflects a net initial yield of 6.75%, allowing for purchaser s costs of 5.8%. A purchase at this price would produce the following yield profile: Net Initial Yield 6.75% Reversionary Yield 7.28% Equivalent Yield (nominal) 7.12% 6

7 FURTHER INFORMATION For further information or to arrange an inspection please contact: James Baillie Patrick Over MISREPRESENTATION These particulars do not constitute an offer or contract. They are intended as a guide to prospective purchasers. All reasonable care has been taken in the preparation of these particulars but their accuracy is not guaranteed. The purchaser should satisfy himself and as to the correctness of these details. Neither the agents nor the vendors or lessors are to be or become under any liability or claim in respect of these particulars. These particulars are supplied on the understanding that all negotiations are conducted through this office. January Adrian Gates Photography & Design