industrial investment within a major redevelopment zone ... · pdf fileone victoria road &...

Ashford International Station

Supermarket/ Brewery & Visitor Centre developmentResidential led mixed use developmentResidential development

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KEY DEVELOPMENTS

ONE VICTORIA ROAD & CHUNNEL INDUSTRIAL ESTATE | VICTORIA ROAD, ASHFORD, KENT TN23 7HJ

Industrial Investment within a major redevelopment zone adjacent to Ashford International Station

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2

A2042

Victoria Road

A2042

3


• Rare opportunity to acquire two industrial assets close to Ashford International Station.

• Victoria Road is undergoing a major regeneration with current development including over 900 new residential units, a hotel, a new Aldi supermarket, Chapel Down brewery and exhibition centre for their ‘Curious Brew’ brand and new offi ces.

• Ashford Town Centre and Ashford International station are both within close walking distance.

• Junctions 9 and 10 of the M20 are approximately 2 miles from the asset, providing excellent coverage of the south east of England and connectivity to the national motorway network.

• Both sites held freehold.

• Eleven units totalling 41,426 sq ft across two separate sites.

• Fully let to seven tenants at a rent of £285,960 per annum equating to a low average rent of £6.90 per sq ft.

• Strong reversionary potential based on local market comparable evidence at over £8.00 psf.

• Potential for higher value use development, subject to planning.

We are instructed to seek offers in excess of £3,700,000 (Three million seven hundred thousand pounds), subject to contract and exclusive of VAT. This price refl ects a 7.25% Net Initial Yield after allowing for purchaser’s costs of 6.52%. Based on our estimates of ERV the reversionary yield at the purchase price is 7.86% reversionary yield.

This price equates to a low capital value of £89 per sq ft.

Consideration will be given to offers for both holdings in isolation. Further information available upon request.

INVESTMENT SUMMARY

U&I development comprising 200 PRS

apartments, 120 bed hotel and three retail units with 16 residential units abovehttp://victoriawayashford.com

Chapel Down Brewery & Visitor Centre

Ashford International Station - 38 minutes to St Pancras Station

Quinn Estates and U & I residential development

providing 660 homes

Elwick Place – 100,000 sq ft leisure and restaurant

developmentwww.elwickplace.com

Ashford College – New 14,5000 sq ft teaching block

First Phase Ashford Commercial Quarter – 60,000

sq ft speculative offi ce development

http://www.ashfordfor.com/space-to-grow/commercial-quarter

LOCAL DEVELOPMENT MAP

Development of 59 fl ats on former Travis

Perkins site

New 18,500 sq ft Aldi Supermarket


Boundary for indicative purposes only


Southampton

Dartford

Bognor RegisPortsmouth

Chichester

Brighton

Colchester

Ipswich

Cambridge

BishopStortford

MiltonKeynes

Oxford

Bury St Edmunds

Sudbury

Buckingham

Stevenage

Winchester

Andover

Newbury

BasingstokeWoking Sutton

Horsham

Maidenhead

HighWycombe

Slough

St.Albans

Sevenoaks

RoyalTunbridge Wells

Eastbourne

Godalming

Stratford-upon-Avon

Marlborough

GuildfordFarnborough

Crawley

Croydon

Bromley

Watford

Maidstone

Gatwick

Heathrow

Chelmsford

Stanstead

Aylesbury

Reading

Wokingham Bracknell

Southend-on-Sea

Felixstowe

Sittingbourne

Abingdon

M4

M3

M23

M11

M25

M25

M2

M20

M3

M27

A34

A40

A346

A34

A31

A272

A27

A21A272 A259

A229

A2070

A28 A2

A28

A2

A21

A3

A24

A130

A127

A12

A41

A414

A120

A10

A10

A5

A1

A131

A43

A429

A26

A22

A36

A12

A6

A12

A12

A133

J13

Canterbury

Folkestone

Ashford

Luton

Banbury

Daventry

LONDONLONDON

Bicester

A1M

M40

J8

M40M25

A428

Bedford

M1

M26

M25

M20

LOCATION CONNECTIVITY SITUATION

Ashford is located in the county of Kent at the southern edge of the North Downs, 57 miles south east of Central London, 23 miles south east of Maidstone, 17 miles north west of Folkestone and 24 miles west of the Port of Dover.

The 2011 consensus revealed that the borough of Ashford saw the largest population growth in Kent with records showing a 14.6% rise to approximately 118,000 inhabitants.

Junction 9 of the M20 is approximately 2 miles to the north and Junction 10 is approximately 2.5 miles to the south east of the subject site.

Ashford International Station provides regular high-speed services into London, as well as international services to Paris, Brussels and Lille.

M20 (J9) 2 miles to the north

M20 (J10) 2.5 miles to the south east

Maidstone 23 to the north west

The subject sites are located on Victoria Road which is accessed via the A2042 to the east or Leacon Road to the west, which links to the A28 (Chart Road).

The site is within close walking distance of Ashford Town Centre and Ashford International Railway station.

Ashford Designer Outlet is approximately 1.1 miles to the south east of the site and has 80 discount concessions, restaurants, cafes and a children’s play area.

The immediate surroundings form part of a major regeneration plan being implemented by Ashford Borough Council to include residential and commercial development.

The nearest industrial estates are approximately 0.5 miles to the west of the estate on Leacon Road with local occupiers including Watling Tyres, Thermo Fisher, BP and Matalan.

Ashford

Victoria Park

Ashford International

A292

Leacon Rd

Chart Rd

A2042

A2042

A28

M20

M20

A20

J9

Road Links

Ports

Rail Links from Ashford International

Folkestone – 18 miles to the south east

Dover – 24 miles to the south east

London St Pancras - 38 minutes

London Charing Cross - 1 hour 2 minutes

London Victoria - 1 hour 30 minutes

Paris - 1 hour 52 minutes


ONE VICTORIA ROAD CHAPEL DOWN IN ASHFORDSITE PLAN

SITE AREA

The property comprises a 12,061 sq ft (1,120 sq. m) single-storey industrial warehouse with ground fl oor offi ces. The building is formed of a steel portal frame with new metal roof comprising approximately 10% roof lights. The building’s elevations are a mix of cladding and brickwork.

The minimum eaves height is approximately 5.25m. Loading is via two roller shutter loading doors and there is a substantial self-contained yard servicing the warehouse which has a maximum depth of approximately 50 metres.

The current tenant Chapel Down Group Plc use the property as a bonded warehouse for the packaging and distribution of their wines. To obtain the bonded warehouse status they had to obtain a license from HMRC.

Prior to the current letting, the Landlord undertook a substantial refurbishment programme which included:

• New roof and roof lights• Shot blasted fl oor• Complete internal and external redecoration to include new

windows, lighting and roller shutter doors• New security fencing around site• New offi ces and WCs• Re-tarmac of the front yard

Planning for a wider B1, B2, B8 and Trade Counter use was granted with conditions in 2014 and revised in 2015. Further information is available on request.

Chapel Down Group have acquired a site close to One Victoria Road on which it is planning to develop a Curious Brew Visitor Centre which will include brewery tours, a restaurant and bar, a visitor centre and brewery. £1.5m of funding for this development was secured in 2016 via a crowdfuding campaign.

This development forms part of a larger regeneration of the entrance to Victoria Way to include an Aldi supermarket, 120 bedroom hotel and 210 new homes (see plan on page 2).

Below is an image of the proposed entrance to Victoria Road on completion of the development taken from the Chapel Down planning application:

The subject site totals approximately 0.80 acres (0.32 hectares). This provides a low site cover of 35%.



CHUNNEL INDUSTRIAL ESTATE SITE AREA SITE PLAN

ACCOMMODATION

The estate comprises 10 units ranging from 2,990 to 3,160 sq ft which are arranged in two terraces, one fronting Victoria Road and the other Victoria Crescent.

The units are of a steel portal frame construction with profile metal clad elevations

Fronting Victoria Road are five units all approximately 3,160 sq ft. Each unit benefits from a concertina loading door, c.3.9m eaves, ground and first floor offices, and separate WCs.

To the front of each unit is loading and parking. Adjacent to Unit 1 is a self contained parking area which is currently demised to the tenant of Unit 1.

The five units fronting Victoria Crescent are single storey without first floor offices but otherwise are of a similar specification.

Given its frontage onto Victoria Road and proximity to the town centre, there is a strong trade bias on the estate with seven of the units open to trade or public customers.

The subject site totals approximately 1.09 acres (0.44 hectares).


Unit Name Tenant Area (Sq Ft) Area (Sq M)

Unit 1 Micheldever Tyre Services Ltd 3,160 294

Unit 2 Micheldever Tyre Services Ltd 3,160 294

Unit 3 Adam Wink & Martin Wink 3,160 294

Unit 4 Motor Parts Direct Ltd 3,160 294

Unit 5 Andrew Sykes Hire Ltd 3,160 294

Unit 6 Hire Station Ltd 2,990 278

Unit 7 Hire Station Ltd 2,990 278

Units 8, 9 & 10 Xylem Water Solutions Ltd 7,585 705

TOTAL 29,365 2,728

The floor areas have been measured on a GIA basis (Gross Internal Area) in accordance with the RICS Code of Measuring Practice (6th Edition). The breakdown of individual unit areas is as follows:


Unit Name Tenant Area (Sq Ft)

Area (Sq M) Start Next Review Break Expiry AWULT AWULTC Rent (pa) Rent (psf) % Income Comment Inside L&T

ActCreditsafe Risk Rating

Unit 1Micheldever Tyre

Services Ltd3,160 294 05/05/2016 18/09/2022 5.3 yrs 5.3 yrs £25,000 £7.91

15%

Photographic Schedule of Condition No Very Low

Unit 2Micheldever Tyre

Services Ltd3,160 294 19/09/2012 19/09/2017 18/09/2022 5.3 yrs 5.3 yrs £18,960 £6.00 Photographic Schedule of

Condition No Very Low

Unit 3Adam John Wink & Martin John Wink

3,160 294 25/02/2016 26/02/2018 0.76 yrs 0.8 yrs £17,000 £5.38 6% No N/A

Unit 4 Motor Parts Direct Ltd 3,160 294 25/12/2011 24/12/2021 4.6 yrs 4.6 yrs £22,500 £7.12 8% Did not activate 2016 break. No Very Low

Unit 5 Andrew Sykes Hire Ltd 3,160 294 10/09/1992 09/09/2013 N/A N/A £22,500 £7.12 8% Holding over. Yes Very Low

Unit 6 Hire Station Ltd 2,990 278 17/07/2000 16/07/2015 N/A N/A £17,500 £5.85

12%

Holding over.Section 25 notice served

at £8.00psf.

Yes Very Low

Unit 7 Hire Station Ltd 2,990 278 13/06/2003 16/07/2015 N/A N/A £17,500 £5.85 Yes Very Low

Units 8,9 & 10

Xylem Water Solutions UK Ltd

7,585 705 29/09/2016 28/09/2018 28/09/2021 4.4 yrs 1.4 yrs £55,000 £7.25 19% Mutual break exercisable upon six months notice. No Very Low

One VictoriaRoad

Chapel Down Group Plc

12,061 1,120 09/12/2015 09/12/2020 08/12/2025 8.5 yrs 8.5 yrs £90,000 £7.46 31%

Bonded warehouse. 2020 Break removed in return

for six months rent free period to be topped up by

vendor on completion. Rent Deposit of £27,000.

No Very Low

41,426 3,849 4.8 yrs 4.2 yrs £285,960 £6.90

TENANCY SCHEDULE

SERVICE CHARGE

The service charge on Units 1-10 Chunnel Industrial Estate in the year July 2015 to July 2016 was £6,771.60 (£0.23psf). There is no service charge related to One Victoria Road.


COVENANT OVERVIEW

The estate is let to seven tenants on nine leases, providing a diverse income base and a spread of covenant risk. 94% of the contracted income is secured against covenants rated by Creditsafe as having an international score of “Very Low Risk”. Financial information for the main tenants on the estate is below:

Chapel Down Group Plc ( 31% of income) Creditsafe – Very Low RiskCompany No. 04362181

Micheldever Tyre Services ( 15% of income) Creditsafe – Very Low RiskCompany No. 01817398

Hire Station Ltd ( 12% of income) Creditsafe – Very Low RiskCompany No. 03428037

Motor Parts Direct Ltd – (8% of income) Creditsafe – Very Low RiskCompany No. 03604992

Andrews Sykes Hire Ltd ( 8% of income) Creditsafe – Very Low RiskCompany No. 02985657

Xylem Water Solutions UK Ltd ( 19% of income) Creditsafe – Very Low RiskCompany No. 00479504

Chapel Down is England’s leading wine produce. Produced in Tenterden, Kent, Chapel Down offers a range of sparkling and still wines, together with an award-winning range of Curious beer and cider. The subject unit is used for wine distribution with the proposals for the site to the east to be used as a brewery for the Curious brand along with visitor centre.

Micheldever are a leading supplier of tyres as well as offering MOT’s and servicing for all makes and models of car. The subject site is split over two units, one focussed on MOT’s and the other tyre replacement under the Protyre brand.

Hire station offers a large range of tools and equipment for hire to both the public and trade. Hire Station operate from 56 branches in the UK.

Motor Parts Direct opened its fi rst branch in Kettering in 2000 and are now one of the UK’s largest independent motor factor supplying car parts to the Independent Garage industry.

Andrews Sykes Hire offers a complete range of our services, from air conditioning hire, pump hire, chiller hire, heater hire, boiler hire, dehumidifi er hire and ventilation hire.

Xylem Water Solutions offers six market leading brands that primarily serve the Public Utilities, municipal and industrial markets with regard to the movement and treatment of clean water and wastewater. The subject unit is operated under the Flygt brand.

Year to Date Turnover Pre Tax Profi t Shareholders Funds

31/12/2016 £7,330,370 £765,126 £15,903,698

31/12/2015 £8,178,978 -£278,881 £14,968,493

31/12/2014 £6,110,135 -£39,968 £14,862,576


31/03/2016 £316,386,000 £3,570,000 £41,620,000

31/03/2015 £322,519,000 £4,870,000 £38,977,000

31/03/2014 £331,152,000 £6,080,000 £38,505,000


31/03/2016 £84,149,000 £10,383,000 £40,172,000

31/03/2015 £78,145,000 £8,191,000 £31,940,000

31/03/2014 £66,584,000 £4,223,000 £25,310,000


31/12/2015 £70,738,363 £1,101,336 £6,567,089

31/12/2014 £59,972,559 £572,039 £5,735,099

31/12/2013 £44,387,408 £1,140,485 £5,286,870


31/12/2015 £36,880,000 £9,317,000 £16,476,000

31/12/2014 £37,401,000 £9,812,000 £15,727,000

31/12/2013 £38,622,000 £11,413,000 £16,223,000


31/12/2015 £155,848,000 £7,910,000 £46,577,000

31/12/2014 £155,869,000 -£1,514,000 £45,567,000

31/12/2013 £113,354,000 £1,691,000 £53,158,000


The South East industrial market continues to demonstrate a very favourable occupational dynamic with increasing demand driven by internet led retail as well as displacement of industrial occupiers from sites with higher value uses.

Void rates are generally at low levels across the Kent region and with limited speculative industrial development planned in the local area, it is unlikely that this will change in the foreseeable future. As a result of this positive occupational picture there is strong evidence to suggest the local market will benefit from rental growth in the short term.

Prime rents in Ashford are now at approximately c. £10.00psf based on a unit currently under offer on the Axiom scheme on Orbital Park.

Rental evidence on similar industrial accommodation in Ashford has recently been set at £8.50psf with a letting on c. 2,825 sq ft on Stafford Close, approximately 0.6 miles to the west of the subject property. This letting completed in December 2016.

The current average passing rent on the estate is only £6.90psf and therefore we believe, based on the above, that there is potential for significant reversion on the subject estate going forward.

OCCUPATIONAL MARKET INVESTMENT MARKET

Date Address Size (Sq Ft)

AWULTC (yrs) Price Net CV

(psf) NIY Purchaser

Current Units A-C Boundary Park Hemel Hempstead 75,611 6.7 yrs c.£14m c.£185 c.4.30% Under Offer

Apr-17 The Loddon Centre, Basingstoke 113,602 3.5 yrs £11.9m £105 6.16% Colliers Capital

(Derbyshire)

Apr-17Motorway

Industrial Estate, Stevenage

60,808 5.5 yrs £7.10m £117 5.43% DTZIM

Apr-17 Central Estate Maidenhead 22,582 2.8 yrs £3.40m £150 5.71% Private Investor

Mar-17Cherrycourt Way Industrial Estate,

Leighton Buzzard113,798 < 3.0 yrs £8.70m £76 5.90% Canmoor &

Blackrock

The positive supply/demand dynamic and potential for rental growth, aligned with a low interest rate environment and forecast outperformance of the industrial sector against other asset classes has led to strong investor focus in the industrial market over the last 12-24 months.

The schedule of comparable investment transactions below highlights the appetite within the current investment market for well-let assets in strategic industrial locations:

DAN GRANT MRICS

PARTNER

T

M

E

020 3198 4446

07956 573 297

[email protected]

W www.stonehillpartners.co.uk

CONTACT

For further information or to arrange an inspection, please contact:

WILL DAVIES MRICS

PARTNER

T

M

E

020 3198 4447

07919 002 707

[email protected]

Important notice: These particulars are not an offer or contract, nor part of one. The sole purpose of these particulars is to provide outline information on this property to prospective purchasers or tenants (as applicable), who are solely responsible for making their own investigations and seeking independent advice, including the costs of doing so, and forming their own view as to the condition of the property and any related fixtures, fittings, services, equipment, plant and machinery, its and their fitness for their requirements and the accuracy and completeness of the statements herein. These particulars do not constitute any recommendation or offer to enter into any contract regarding this property and neither Stonehill Partners Limited nor any of its employees, agents or representatives guarantees the accuracy or completeness of any description, dimensions, references to condition, necessary permissions for use and occupation and other details contained herein. You should not rely on statements by Stonehill Partners Limited in the particulars or orally or in writing (each being a “Statement”) as being factually accurate about the property, its condition or its value. Neither Stonehill Partners Limited nor any of its employees, agents or representatives have any authority to make any representations about the property, and accordingly any Statement given is entirely without responsibility or liability on the part of Stonehill Partners Limited, the seller(s) or lessor(s) or any of its or their employees, agents or representatives. Any photographs provided show only certain parts of the property as they appeared at the time they were taken. Areas, measurements and distances given are approximate only and you must satisfy yourself as to their accuracy. Any reference to alterations to, or use of, any part of the property does not mean that any necessary planning, building regulations or other consent has been obtained. You must find out by way of your own inspection or in other ways that these matters have been properly dealt with and satisfy yourself as to the accuracy of all such information through your own investigations. To the extent that any third party information or Statement is included within these particulars, this information has been received and passed on by Stonehill Partners Limited in good faith but without liability or responsibility of any kind. VAT may be chargeable in addition to sums referred to herein and may be subject to alteration. June 2017.

PROPOSAL

EPC

A copy of the EPCs can be provided upon request.

VAT

DATAROOM

The property is elected for VAT and it is anticipated that the transaction will be treated as a Transfer of Going Concern (TOGC).

A data room with further documentation related to this sale is available upon request.

We are instructed to seek offers in excess of £3,700,000 (Three million seven hundred thousand pounds), subject to contract and exclusive of VAT. This price reflects a 7.25% Net Initial Yield after allowing for purchaser’s costs of 6.52%. Based on our estimates of ERV the purchase price reflects a 7.86% reversionary yield.

This price equates to a low capital value of £89 per sq ft.

Consideration will be given to offers for both holdings in isolation. Further information available upon request.

industrial investment within a major redevelopment zone ... · pdf fileone victoria road &...

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