address... 1-4 South Parade, Nottingham location... Strong trading location opportunity... Prime retail investment tenure... Long leashold. Pre-emption to purchase freehold tenant... Let to Starbucks Coffee Company (UK) Limited lease... 14 years term certain. cost... Offers in the region of 2,680,000 (STC) return... Net Initial Yield of 6.00%
Nottingham Nottingham is located approximately 126 miles north of London, 16 miles north east of Derby, 30 miles north of Leicester and 30 miles south east of Sheffield. Nottingham has a population of over 630,000 with over 3 million people within 1 hour s drive. The City is home to two large universities with a combined 60,000 student population. Nottingham is well established as a Top 5 UK Retail Destination, it is ranked 4th on the basis of its PMA Retail Score and 4th best shopping area in the UK on Experian Retail Centre Rankings. The town benefits from good transport links with Junction 25 of the M1 approximately 7 miles to the south west and Junction 26 4.5 miles to the south west. The city is connected to the national railway network with a fastest journey time to London St Pancras of 1hr 40 minutes. East Midlands airport is approximately 14 miles to the south west and Birmingham International Airport approximately 50 miles to the south west. Retailing in Nottingham Nottingham city centre retail floor space is estimated at 2.74 million sq ft, ranking the city 3rd of the PMA Centres Nottingham s retail pitch is extensive with a strong pedestrian flow between the city s two principal centres. The Victoria Centre is located to the north of the centre provides 980,000 sq ft of retail space with 2,750 car spaces and is anchored by John Lewis and House of Fraser supported by Next, Boots and Tesco. At the southern end of the city is the Broadmarsh Centre anchored by TK Maxx, BHS and Wilkinson with other key tenants including Boots, New Look and Argos. The Broadmarsh centre is currently undergoing a 700 million redevelopment which is expected to transform the City Centre. The development will more than double the size of the existing centre, creating 1,460,000 sq ft of retail space including two new department stores, a fresh food hall, a supermarket, a 1,200 seat food court and more than 200 new shops. Marks and Spencer and Debenhams have already signed up as anchors and once on site it is expected to take 3 years to complete. Situation Description The subject property comprises an attractive Grade II listed building (constructed in 1888) arranged over basement and ground floor with 4 separately accessed upper floors. The upper floors are currently undergoing a comprehensive refurbishment to 15 residential apartments. Refurbishment work is due to complete by the end of April 2009. The ground floor retail unit has just been fitted out in Starbucks latest corporate format. The unit benefits from extensive frontages to two of Nottingham s prime retail streets and provides open plan retail/restaurant accommodation. Male and Female customer toilets are located at basement level. Accommodation The property provides the following accommodation: Description Sq M Sq Ft GF Sales 188.41 2,028 Remainder 72.09 776 ITZA 110.18 1186 Basements 162.58 1,750 Total 504.64 5,432 Tenure A new 250 year lease (at a peppercorn) will be sold on the retail element of the building. The vendor will offer the purchaser of this interest a preemption right to acquire the freehold interest for 1 after 7 years. The upper floors will be sold off on a separate 250 year lease. Tenancy The entire property is let to Starbucks Coffee Company (UK) Limited. The full repairing and insuring lease is for a term of 15 years with effect from 10 April 2008. The current passing rent of 170,000 per annum ( 125 ZA) is reviewable every 5 years to the open market value. The property is located overlooking the Old Market Square, on the corner of South Parade and Wheeler Gate, between the two main covered shopping centres. Beast Market Hill is located directly opposite the property and Friar Lane to the west. These streets are pedestrianised and are located within the Prime Retail Core. Other national retailers represented in the immediate vicinity include Costa Coffee, RBS, BetFred, HMV and Debenhams department store.
Covenant Status Starbucks Corporation is an international coffeehouse chain based in Seattle, USA. Starbucks is the largest coffeehouse company in the world, with 16,120 stores in 44 countries (500 in the UK). Starbucks sells drip brewed coffee, espresso-based hot drinks, other hot and cold drinks, snacks, and items such as mugs and coffee beans. Starbucks Corporation turnover in 2007 exceeded $9.4 billion with total assets of $2.28 billion. Starbucks Coffee Company (UK Limited) reported the following trading figures in the last two years audited ac- counts:- 29 April 2008 29 April 2007 Turnover 328,160,137 286,645,489 Pretax Profits 1,463,264 ( 4,041,871) Shareholders Funds 55,942,715 58,355,705 Further information is available at www.starbucks.co.uk and www.starbucks.com VAT VAT will be payable on the purchase price. Proposal Our client is seeking offers in excess of 2,680,000 for their long leasehold interest. A purchase at this level reflects a 6% net initial yield, after deducting purchase costs at 5.725%. MISREP The accuracy of any description, dimensions, references to condition, necessary permissions for use and occupation and other details contained here in is not guaranteed and is for general guidance only and prospective purchasers or tenants must not rely on them as statements of fact or representations and must satisfy themselves as to their accuracy. Christopher Dee nor any of its employees or representatives has any authority to make or give any representation or warranty or enter into any contract whatever in relation to the property. Rents quoted in these particulars may be subject to VAT in addition. The reference to any mechanical or electrical equipment or other facilities at the property shall not constitute a representation (unless otherwise stated) as to its state or condition or that it is capable or fulfilling its intended function. Prospective tenants/purchasers should satisfy themselves as to the fitness of such equipment for their requirements. Designed and Produced by 90 Degrees Design and Marketing 0161 833 1890. April 2009.
Further Information For further information or to arrange an inspection, please contact: Christopher Dee 40 Peter Street Manchester M2 5GP Mark Powell Tel: 0161 831 5864 Email: mp@christopherdee.co.uk Chris Bathurst Tel: 0161 831 5881 Email: cb@christopherdee.co.uk