Freehold City Centre. Substantially Refurbished Office Investment Lawrence House 5 St Andrews Hill Norwich NR2 1AD

Transcription

1 Freehold City Centre Substantially Refurbished Office Investment Lawrence House 5 St Andrews Hill Norwich NR2 AD

2 KING S LYNN Norwich Airport GREAT YARMOUTH A47 A46 THE PROPERTY LOWESTOFT ST T. A NEWMARKET IPSWICH ET RE S ES ST INC PR ST. ANDREW STREET S HILL CAMBRIDGE A BURY ST. EDMUNDS A2 ES RG A4 O GE HUNTINGDON A4 EW T. ANDR TS EE TR ES RG EO.G ST NORWICH A PETERBOROUGH A ET RE T NS O STANSTED LUTON AM M CHAPELFIELD HARWICH. ST A2 EY RR HARLOW ND LO SU M COLCHESTER FELIXSTOWE M25 M40 LONDON Investment Summary Location Located in Norwich city centre Norwich is a major East Anglian centre situated approximately 0 miles north of London, 60 miles north east of Cambridge and 40 miles north of Ipswich. The city has a resident population of approximately 32,000 rising to 250,000 within the Greater Norwich area and suburbs. Freehold Substantially refurbished office building arranged over basement, ground and five upper floors, totalling 44,397 sq ft Lawrence House benefits from 29 car parking spaces (27 in basement) together with being close to the new St Andrews car park that provides over,000 car spaces Let to six tenants producing 28,023 pa (refurbished). AWULT of 5.98 years and 2.76 years to break The A connects Norwich to Cambridge and the M. The A40 provides a link to Ipswich and the A47 links Norwich to the A and the Midlands. Road communications have been greatly improved with the recent widening of the A to full dual carriageway status. Excluding poorer quality stock, the office availability rate in Norwich reduces to 3.6% There are two mainline rail services per hour to London's Liverpool Street station with a fastest journey time of hour 40 minutes. Norwich International Airport offers regular flights to domestic and European destinations including Amsterdam Schiphol, Aberdeen, Edinburgh and Manchester. We are instructed to seek offers in excess of 4,250,000 which reflects a low capital value of per sq ft. Once fully let the potential reversion is.72% (after taking into account costs for refurbishing the shell condition offices to Grade A specification). The city has experienced significant development activity over recent years. Major projects include the regeneration of the Riverside area, completion of the Forum Library and Lendlease's major retail scheme at Chapelfield. Norwich is ranked 0th in the UKs top retail centres. Vacant element - 3,80 sq ft refurbished /6,29 sq ft in shell condition Potential to increase income to 572,798 pa

3 THE PROPERTY Situation Lawrence House is situated on the east side of St Andrews Hill, which links St Andrews Street with London Street, right in the very centre of Norwich. The city's numerous shopping and leisure amenities including the Forum and Chapelfield Shopping Centre, are all within easy walking distance of the building. The inner ring road is within a short drive which provides access to the A, A40 and the A47. Norwich railway station (approximately 0.5 miles away) has two train services per hour to London Liverpool Street. To the north of the city, Norwich International Airport offers flights daily to Amsterdam Schiphol Airport along with other UK and European destinations including Edinburgh and Dublin. Occupiers in the immediate vicinity include Norwich School of Art & Design, HSBC Bank, Birketts Solicitors, as well as a number of other professional service firms.

4 Description Lawrence House is an impressive six-storey building, with car parking in the basement. It has recently undergone a substantial refurbishment (except the st floor and rear suite, 2nd floor), on a site area of 0.35 acres (0.43 hectares). The accommodation provides high specification, modern flexible floors with a spacious reception/entrance area. Internally, the specification includes: Comfort cooling New suspended ceilings Category 5 recessed lighting 2 lifts serving all floors New carpets Perimeter trunking Window blinds Complete redecoration New hardwood doors Male and female WCs on each floor 29 on-site car spaces There is secure underground car parking together with two external car spaces, providing 29 on-site car spaces. A short distance from the building is the recently built, modern St Andrews multi-storey, car park, St Andrews Street /Duke Street (,084 car spaces), run by Norwich City Council ( 980 per annum/space). Tenure Freehold Ground Floor Layout

5 3rd Floor Layout

6 Tenancy & Accommodation Schedule The offices are let to six tenants on full repairing and insuring leases. Together with income derived from car parking licenses, the building currently produces a total income of 275,859pa. Two vacant suites have been fully refurbished and the st floor and the 2nd floor, rear suite are in shell condition ready for refurbishing. Floor Tenant Ground Floor (Front) Area Car Space Allocation Lease Term From - To (Break Date) Next Rent Review Rent PA (psf) ERV PA (psf) 29, ,250 ( 4.5) ( 8.00) Sq m Sq ft Vacant 2 month rent guarantee ,98 Ground Floor (Rear).. Insight CCI Ltd ,766 st Floor. Vacant ,964 2nd Floor (Front).. Cooper Lomaz Recruitment Ltd ,637 2nd Floor (Rear). Vacant ,327 3rd Floor A (Part Front) Isadore Goldman Ltd ,889 6/09/ 5/09/2 6/09/206 25,600 ( 8.86) 39,000 3rd Floor B (Part Front) Pupil Asset Ltd /0/3 5/0/8 (T: 6/0/206) 6/0/206 8,920 ( 0.00) 2,042 3rd Floor A (Part Rear) R&Q Central Services Ltd , /05/4 - /05/9 (T: 2/05/7) 2/05/207 42,26 (.05) 5,624 3rd Floor B (Part Rear).. Vacant 2 month rent guarantee ,257 3,257 4th & 5th Floors. Norfolk County Council ,98 80,000 ( 3.5) 80,000 ( 3.5) 277, , /2/0 4/2/20 (T: 5/2/5) 5/2/205 39,496 ( 4.00) 3/02/5 2/02/25 (T: 3/02/20) 3/02/ ,462 ( 2.50) 27/02/08 26/02/23 (T: 27/02/8) Sub Total 27/02/207 Fully refurbished vendor 2 month rental guarantee In shell condition removed from the rating list. ERV once refurbished. 50,000 88,578 ( 4.00) 6 Comments... In shell condition removed from the rating list. ERV once refurbished.. Tenant deposit 2,973 Fully refurbished vendor 2 month rental guarantee.. Car Park space no 29 licence (external) Norfolk County Council 20/2/2 9/2/5 (L: 2 month notice),000,000 Landlord can give 2 month notice Car parking (4 spaces) licence Insight CCI Ltd 4 5/2/0 4/2/20 (L: month notice),200 4,000 Landlord can give month notice Car parking space no 4 licence Pupil Asset Ltd 30/06/4 5/0/8 (L: month notice) 700,000 Landlord can give month notice at any time to terminate at the end of any quarter Car parking space no 6 licence Isadore Goldman Ltd 26/08/4 5/09/2 (L: month notice) 700,000 Landlord can give month notice at any time to terminate at the end of any quarter Car spaces available x 7 plus disabled no 28 (external) TOTALS 8 4, , For allocation to the vacant offices 28, ,798

7 Service Charge The service charge for the building, year ending 3st March 205 was 9,869 ( 2.70 per sq ft). The landlord's liability for the vacant elements equated to 45,750. All service charges are fully recoverable from the tenants under the terms of their leases. There are no service charge caps. Tenant Covenant Information Tenant Description Covenant Strength Insight CCI Ltd Telemarketing company used to drive results for charitable lotteries, raffles and committed donations. Clients include The Heart Research Institute (UK), The Hospice Lottery and Norwich City Football Club. Tangible net worth of 76,994 Cooper Lomaz Recruitment Ltd Recruitment consultancy based in Norwich, Bury St Edmunds and Lowestoft. Established for 25 years with a team of over 60 specialist consultants. 22nd in the Sunday Times Best Small Companies to Work For. Tangible net worth of 849,763 with a moderately low probability of failure Isadore Goldman Ltd Law firm specialising in insolvency, commercial litigation, bank recovery and property litigation with offices in Norwich and London. D&B analytics indicate a moderately low probability of failure Pupil Asset Ltd Provides software to schools which allows them to analyse performance using a single operational system which integrates reporting, registration, Ofsted and parental engagement. Finalist in the 204 Education Resources Awards. D&B analytics indicate a moderately low probability of failure R&Q Central Services Ltd. Founded in 99, with a team of over 400 insurance professionals based in the UK, US, Bermuda and Europe, the company acquires and manages a portfolio of insurance receivables with a carrying cost of 6m as at 3 December 203. Tangible net worth of 320,35 with a moderately low probability of failure Norfolk County Council Home to the Norfolk Pension Fund run by Norfolk County Council as the administering authority N/A Market Commentary Norwich is the most easterly city in the UK, the administrative and commercial capital of East Anglia and the principal city in the county of Norfolk. The city is one of the best performing locations in East Anglia along with Cambridge and north Norfolk. The local economy is dominated by long-term business native to the area and those with historical ties to the city, most notably Aviva (formerly Norwich Union) and Marsh. Other large employers include Unilever Bestfoods, BBC East and John Innes Centre (R&D). Financial and business services account for approximately 7% of total employment in the city with the main occupiers being Virgin Money (HQ), HSBC and Royal Bank of Scotland. The public sector also has a high percentage of occupation, including organisations such as Norwich City Council, CPS and HM Customs and Excise. The supply of offices in and around Norwich is approximately 557,000 sq ft which represents a fall of 20% from the previous year. For the first time in 6 years, availability rates fell below 0%, down to 7% in the second half of 204 with no Grade A space on the market and more than 56% of second hand space in poorer quality stock. Excluding poorer quality stock, the availability rate reduces to 3.6%. At present, prime office space is achieving a headline rent of 6.50 per sq ft and good secondary space is achieving.50 per sq ft. We are of the opinion that the refurbished space within Lawrence House should achieve a headline rent of per sq ft, as supported by the evidence below (all of which took place during the second half of 204): Avocet Court, St Andrews Business Park,462 sq ft let to Perfect Placement on a 0 year lease at a rent rising to 3.75 per sq ft Ground floor, Cavell House, Stannard Place 7,367 sq ft let to CAN Insurance on a 0 year lease with a 5 year break clause at 3.00 per sq ft Part second floor, Yare House 5,54 sq ft let to BDO on a 0 year lease with a 5 year break clause at 5.50 per sq ft Ninth floor, Norfolk House 3,655 sq ft let to NDI Insurance and Reinsurance Brokers Ltd on a 5 year least from January 204 with a 5 year break clause at 4.00 per sq ft Seventh floor, Norfolk House 3,500 sq ft let to Voice Host Ltd on a 3 year least from January 204 at 4.60 per sq ft

8 Further Information Should you have any queries or wish to make an inspection, please contact: Darryl Stevenson DD: Katherine Ilett DD: ERV EPC Rating We are of the opinion that the ERV for refurbished offices is per sq ft. Taking into account the car park licence income and assuming the shell condition offices are refurbished, this reflects a total ERV of 572,798 per annum for the property. The ratings range from C6 to D84. A schedule is available on request. The vendor has obtained a quote for refurbishing the vacant shell condition offices (6,29 sq ft) to Grade A specification based on 24 per sq ft ( 390,984). This is to include suspended ceilings with recessed Cat 5 lighting and air conditioning. We are instructed to seek offers in excess of 4,250,000 for the freehold interest, subject to contract and exclusive of VAT. This reflects a low capital value rate of per square foot. Based on our opinion of ERV of 572,798 pa, this will show an investor a return of.72% (after deducting costs of refurbishing the shell condition offices to a Grade A specification). VAT The property is elected for VAT. We anticipate the transaction will be treated as a TOGC. Proposal Andrew Groves DD: andrew.groves@bidwells.co.uk Bidwells 25 Old Burlington Street London WS 3AN Tel: May 205

9 IMPORTANT NOTICE RELATING TO THE MISREPRESENTATION ACT 967 Bidwells LLP act for themselves and for the vendors of this property, whose agents they are, give notice that: These particulars do not form part of any offer or contract and should not be relied upon as statements or representatives of fact. Bidwells LLP have no authority to make or give in writing or verbally any representation or warranties in relation to the property. Any areas of measurements or distances are approximate. The text, photographs and plans are for guidance only and are not necessarily comprehensive. No assumptions should be made that the property has all necessary planning, building regulation or other consents. Bidwells LLP have not carried out a survey, nor tested the services, appliances or facilities. Purchasers must satisfy themselves by inspection or otherwise. In the interest of Health & Safety, please ensure that you take due care when inspecting the property. Bidwells LLP is a limited liability partnership registered in England & Wales (registered number Oc344553). Registered head office is Bidwell House, Trumpington Road, Cambridge CB2 9LD, where a list of members is available for inspection. bidwells.co.uk Cert No 8542 ISO 900, ISO 400