Burrington Business Park

BURRINGTON BUSINESS PARK

Burrington Way | Plymouth PL5 3LX

Multi-Let Industrial Investment with 7.37 Years to Expiry

INVESTMENT SUMMARY • Burrington Business Park is a multi-let industrial asset • The property is located adjacent to the A38 Devon Expressway in north Plymouth providing quick access to the M5, Cornwall, Devon and Plymouth City Centre • An extensively refurbished industrial property providing predominantly industrial/warehouse accommodation totalling around 106,785 sq ft with units ranging between 807 and 14,919 sq ft • The landlord has invested in excess of £3 million refurbishing the property, including significant capital expenditure on energy efficiency savings comprising insulated cladding, an energy-saving roof and the installation of solar panels • A net rental income of £523,458 per annum, reflecting a low average rent of £4.54 per sq ft on the industrial space and £6.64 per sq ft on the office accommodation • A gross rental income of £599,751 per annum, reflecting a low average rent of £4.81 per sq ft on industrial space and £9.50 per sq ft on the office accommodation • The property comprises 16 units let to 11 separate tenants • The weighted average unexpired lease term is 7.37 years to expiry and 4.12 years to lease events • Site area of 7.58 acres (3.07 hectares), providing a low site coverage of approximately 32% • Freehold • The vendor has had detailed plans prepared for six additional units, providing the potential to deliver an extra 18,000 sq ft

We are instructed to seek offers in excess of £6,544,000 (Six Million, Five Hundred and Forty Four Thousand Pounds) for our client’s freehold interest, subject to contract and exclusive of VAT. A purchase at this level would reflect a net initial yield of 7.50%, assuming purchaser’s costs of 6.64%, and a low capital value of £61.28 per sq ft.

SITUATION

DEMOGRAPHICS

Plymouth City Centre is situated 2.8 miles to the south of the property and access to the city centre is provided by the A386. The A38 Devon Expressway provides connectivity to the M5 at Exeter to the north east and Cornwall via the A390 & A30 arterial roads to the west.

The City has a population of 260,000 within the primary catchment area, rising to over 1.1m within a 3-hour drive.

Burrington Business Park is Plymouth’s premium hub for businesses, with neighbouring occupiers including Bookers Wholesale, SSE Contracting, Bestway Cash & Carry and Mitie Property Services.

Key employment facts: • There are 131,400 people in employment within the catchment, the nearest competing centres by size are Bournemouth & Poole (127 miles), and Portsmouth (171 miles).

• Employment in Manufacturing and Transport & Storage in Plymouth stood at 18,000 people or in percentage terms, 13.7% of total employed; above the national average assessed by ONS of 10.7%.

• Plymouth’s unemployment rate was 5.0% June 2016 – June 2017, which was 1.3% higher than the South West average and 0.3% higher than the average for Great Britain.

• Financial & Business Services employment is aligned with the national average at 5.0%.

Oceansgate Plymouth Plymouth City Centre HM Naval Base Devonport

Plymouth Argyle FC

MAJOR EMPLOYERS:

BURRINGTON BUSINESS PARK

Exeter/Bristol/M5 A3064

A38 Devon Expressway Cornwall

Defence: the Plymouth economy has traditionally been linked with maritime defence with over 12,000 people employed and approximately 7,500 in the armed forces. Devonport Dockyard is the only UK naval base that refits nuclear submarines and the Navy estimates that the Dockyard generates about 10% of Plymouth’s income. All new UK naval Frigates will now be based in Plymouth in the future following a recent Government announcement securing much employment and which will likely see the expansion of the Royal Navy in Plymouth for the first time in many decades.

Plymouth has the largest cluster of marine and maritime businesses in the south west with 270 operating within the sector.

Acting as the regional hub Plymouth hosts the city council plus the South West Business Council. The public sector is the prominent employer for the city with a high number of employees in health, education, administration and defence.

Other substantial employers include the University of Plymouth with almost 3,000 staff, the Plymouth Gin Distillery, The Range headquarters and Plymouth Science Park which employs 500 people across 50 companies.

DESCRIPTION Burrington Business Park comprises an extensively refurbished, multi-functional mix of warehousing and distribution facilities, as well as contemporary office space situated amid landscaped grounds offering ample parking. Vehicle movements have been specifically split to separate HGV and van movement to the rear of the site directly to the logistics and storage units, some of which offer dock levellers.

The property extends to approximately 106,785 sq ft, providing predominantly industrial/ warehouse accommodation.

The building is of steel frame construction, with a concrete floor, blockwork walls with predominantly profile steel sheeting to the walls and roof. The property provides a large parking area which wraps around the entire property. The warehouse specification includes full eaves height of up to approximately 5.02m as well as level access loading doors and 10 dock levellers.

The specification of the offices includes double glazed windows, 2.40m floor to ceiling height, suspended ceilings with recessed LED lighting, perimeter trunking and roof mounted VRF heating and cooling system.

LANDLORD REFURBISHMENT The landlord acquired the property in 2014, since which time in excess of ÂŁ3.00m has been invested in the property with a focus on energy efficiency, including the installation of insulated cladding, energy-saving roofing and solar panels.

ACCOMMODATION The property has been measured in accordance with the RICS Property Code of Measuring (6th Edition) and provides the following Gross Internal Floor areas:

SITE AREA The site totals approximately (7.58 acres (3.08 hectares), providing a low site coverage of approximately 32%.

UNIT

USE

AREA (SQ FT)

AREA (SQ M)

1

Warehouse

8,913

828

2

Warehouse

6,265

582

3

Warehouse

4,661

433

4

Warehouse

2,960

275

TENURE

5/6

Warehouse

10,570

982

7

Warehouse

2,852

265

8

Warehouse

1,561

145

The property is held freehold under title number DN185684.

9

Warehouse

12,066

1,121

10

Warehouse

7,040

654

Office (Grd)

2,142

199

Office (Grd)

3,735

347

Office (1st)

2,691

250

11

Warehouse

4,593

427

12

Warehouse

14,919

1,386

Office (Grd)

5,500

511

Office (1st)

4,284

398

13

Warehouse

4,951

460

14

Office (Grd & 1st)

807

75

15

Warehouse

990

92

16

Warehouse

TOTAL

5,285

491

106,785

9,921

Burrington Business Park

For illustration purposes only

Cornwall

1

A3064 / City Centre

7 2 8

3 4 9

6 10 5

11

BUSINESS 1 BURRINGTON PARK 2

Mitie

3

NHS Records Management

4

Bestway Cash & Carry

5

Walkham Business Park

6

SSE Contracting

7

Stainless Fabs Limited

8

Kestrel Park

9

Palladium Business Supplies

10

BL Electrical Contractors

11

Booker Wholesale

12

Plymouth Library Services

12

Exeter/Bristol/M5

A38 Devon Expressway

TENANCY The property is let to 11 tenants providing a weighted average unexpired lease term of 7.37 years to expiry and 4.12 years to lease events.

For the purpose of the disposal of this investment, the vendor will top up the net rental income to £523,458 per annum, reflecting a low average rent of £4.54 per sq ft on the industrial space and £6.64 per sq ft on the office accommodation.

TENANCY SCHEDULE LEASE START

RENT REVIEW

TENANT BREAK

LEASE EXPIRY

8,913

5

27/01/18

-

26/07/20

26/01/23

£52,453

Task Force Distribution Limited

6,265

10

16/05/14

-

16/05/19

15/05/24

Plymouth Community Homes

4,661

5

02/06/15

-

-

01/06/20

Handy Straps Limited

2,960

5

14/04/15

-

-

13/04/20

USE

TENANT

SQ FT

1

Warehouse

Rogers Wholesale Foods Limited

2

Warehouse

3

Warehouse

4

Warehouse

Container Space 5/6

Handy Straps Limited Warehouse

GROSS INCOME PAX

LEASE TERM

UNIT

Magma Mouldings Limited

RENT PER SQ FT

COMMENTS

PLANNING

CONTRACTED OUT

£5.88

Tenant has option to renew for a further 5 years (July 2020), with the rent set at passing plus compounded RPI (cap 5% & collar 2%).Rent payable monthly in advance.

B1,2&8

Yes

£26,065

£4.16

Tenant has exercised notice to break.

B8

No

£19,605

£4.21

B1&2

No

£14,676

£4.96

A1,B1,2&8

No

£3,000 10,570

5

07/09/15

-

-

06/09/20

£43,398

No formal documentation £4.11

B1&2

No

Service charge cap of £2,706.55 pa and the cap is subject to annual review by reference to RPI (upwards only).

Rent is payable monthly in advance. Schedule of Condition.

B8

No

7

Warehouse

The British Red Cross Society

2,852

10

14/10/16

14/10/21

14/10/21

13/10/26

£13,500

£4.73

8

Warehouse

LoveKeepCreate Limited

1,561

7

09/02/18

-

09/08/21

08/02/25

£11,823

£7.57

Rent payable monthly in advance.

B1,2&8

Yes

£4.97

Current rent passing is £30,000 with stepped rent to £60,000 on 12 Feb 2020. Landlord will top up the rent to Feb 2020.

D2

No

We have devalued to the rent, which reflects £4.85 per sq ft (warehouse) and £9.50 per sq ft (offices) inclusive of service charge.

Service charge is payable at a fixed rate of £15,472.64 and is included within the rent.

Rent will be payable monthly in advance.

D1

Yes

We have devalued to the rent, which reflects £4.83 per sq ft (warehouse) and £9.50 per sq ft (offices) inclusive of service charge.

Landlord will top up the rent to 2 May 2020.

Ability to increase rent by a further £50k upon tenant terminating their leases at Airport Business Centre Limited.

B1,2&8

Yes

9

10

Warehouse

Grip-UK Limited

12,066

Warehouse

7,040

Office (FF 3)

Construction Training South West Limited

2,691

Office (GF 1) Office (GF 2)

11

Warehouse

Office (GF)

12/02/18

-

-

11/02/28

£60,000

10

01/11/18

31/10/23

31/10/23

31/10/28

£115,561

£7.40

9.5

TBC

30/04/23

30/04/23

31/03/28

£20,000

£4.04

10

02/05/18

02/05/23

02/05/23

01/05/28

£165,000

£6.68

10

18/09/18

18/09/23

18/09/23

17/09/28

£29,000

£5.86

Rent is payable from 1st December 2018, during this period the tenant must pay an interim service charge of £101.94 per month.

B1

No

5

27/01/18

-

26/07/20

26/01/23

£25,670

£4.86

Tenant has option to renew for a further 5 years (July 2020), with the rent set at passing plus compounded RPI (cap 5% & collar 2%).Rent payable monthly in advance.

B1,2&8

Yes

3,735 Construction Materials Online Limited

Warehouse 12

2,142

10

4,593 14,919

Construction Materials Online Limited

Office (FF)

5,500 4,284

13

Warehouse

Bolton Gate Services Limited

4,951

14

Office (GF + FF)

Estate Office

807

15

Warehouse

Vacant

990

16

Warehouse

Rogers Wholesale Foods Limited

5,285 106,785

Gross Income

£599,751

Service charge shortfall

£76,293

Net Income

£523,458

SERVICE CHARGE Each tenant’s rent is inclusive of a contribution towards service charge with the exception of The British Red Cross. The current budget is currently running at £79,000 per annum, which save for £2,706.55 is not recoverable from the tenants. The service charge equates to £0.30 per sq ft (warehouse) and £2.86 per sq ft (offices).

For the purposes of pricing (see Tenancy Schedule), we have deducted £76,293 from the gross income to reflect the landlord’s contribution.

Further information is available upon request.

FLOOR PLANS m. l.

OFFICE 3

UNIT 12 OFFICE UNIT 14

57.62

FIRST FLOOR

60.09

DP

60.38

UNIT 8

UNIT 7

UNIT 5/6

UNIT 4

UNIT 9

N

UNIT 9 ENTRANCE

UNIT 3

UNIT 2

UNIT 1

UNIT 10

UNIT 11

UNIT 16

UNIT 12

UNIT 13

UNIT 15 OFFICE 1

OFFICE 2

UNIT 12 60.35

60.13

GROUND FLOOR

UNIT 14

COVENANTS Construction Materials Online Limited (30.85%) The principal activity of the company is the retail of roofing, drainage and insulation supplies.

During 2017 the business saw exceptional growth, with turnover increasing 44% to £26.5m. The business also saw gross profit increase by 39% to £4.4m, with gross margin decreasing slightly from 17.1% to 16.4%, as the company maintained its strategy of passing on the benefits of competitive pricing to its customers.

Turnover

31 DECEMBER 2017

31 DECEMBER 2016

31 DECEMBER 2015

£26,462,898

£18,358,132

Exempt

Profit (loss) before tax

£1,175,077

£1,469,031

Exempt

Net assets (liabilities)

£2,733,162

£1,181,470

£525,946

Construction Training South West Limited (19.27%) Construction Training South West provides a wide range of courses and qualifications in professional and technical vocational diplomas at all levels, and a range of apprenticeships. The Company has an excellent track record with recognised employers throughout the South West.

Rogers Wholesale Foods Limited (13.03%) Rogers Wholesale Foods started in January 2015 and has expanded quickly to operate “The UK’s Biggest Gone Past Best Before Warehouse”. The company now operates its flagship warehouse from Burrington Business Park, along with further premises in Poole and Southampton.

Magma Moulding Limited (7.24%) Magma Moulding Limited is part of Magmatic Group and supports its belief that travel is about new experience, creating memories and making every journey just as exciting as the destination. Magma manufactures the world famous Trunki suitcase using its specialist skills in technical and engineering mouldings, which also assists in supplying a range of ‘third party’ UK customers, including the particularly demanding automotive sector.

Turnover

31 DECEMBER 2017

31 DECEMBER 2016

31 DECEMBER 2015

£3,655,138

£3,579,671

£2,980,512

Profit (loss) before tax

£1,998

(£80,856)

(£59,270)

Net assets (liabilities)

(£1,325,919)

(£1,401,253)

(£1,316,963)

Neath

1 B427

A4

M4

Newport

Swindon

M4

M32

Bristol

M5

Western-Super-Mare

A346

Bracknell Newbury

Bath A338

A37

M3

Basingstoke

Minehead

A39

Bridgwater Barnstable

A303

Glastonbury

A338

A350

Taunton 9

A3

A303

M5

A303

A3

M3

54

Yeovil

A3

M27 M27

A3(M)

A37

86 A3

A31 Southampton

Exeter

Okehampton

A27

Portsmouth

0 A3 A30

M4

Reading

M4

A4 A50

A38

A404

A34

M49

Cardiff

Ilfracombe

M40

19

1

A3

M48

Swansea

A429

65

A4

Llanelli

Tenby

A4 7 0

Pembroke Dock

A449

Milford Haven

St David’s

A3052

A35

A35

WEST PARK

Bournemouth ISLE OF WIGHT

A30

Bodmin

Looe

5 07

0

A39

A39

A3

A3

A30

St Austell

A3 8

Newton Abbot Torquay

Saltash

A38

A3

Plymouth

Truro

DEVO

8

N

Salcombe

BARNE BARTON

PR

UX EA

WA Y MANADON

A SS BYP

A38 HO NIC KN

EX

PRE

SSW AY

PENNYCROSS

TO EXETER & M5

E

ECT

HAM

E

DRIV

86

OSP

ES L E Y

AD

L AN

HAM

N PR

OL

RO

VO N

LE

W

BURRINGTON WAY

DE

OW

D

ROA

A3

94 A3

WESTON MILL

Falmouth

ROAD

HONICKNOWLE

ESS

ST

A30

Penzance

EX

AD RO

A

RI

O

CT

VI

VO N

KING’S TAMERTON

AY SW ES PR EX

SALTASH

Wembury

CROWNHILL

DE

TO TRURO & CORNWALL

A386

Redruth

Liskeard 8

Newquay

St Ives

Tavistock

Weymouth

D

Exmouth

BU

9

A3

Air: Exeter Airport is only 48 miles away with regular flights to most UK cities and many European destinations.

Port: The Port of Plymouth is a busy leisure and commercial port. Home to Brittany Ferries providing regular services to France and Spain to over 450,000 passengers a year. The port also handles around 250,000 tonnes of cargo each year with extensive storage facilities across the 46-acre site.

TL

AN

D

Rail: There are direct rail services from London Paddington (2 hours 59 minutes), Birmingham New Street (3 hours 21 minutes), Bristol Temple Meads (1 hour 54 minutes) and Exeter (55 minutes).

U O

0

Road: The A30 and the A38 dual carriageways run either side of the Dartmoor National Park providing access to the national motorway network at junction 31 of the M5 motorway at Exeter.

HOME PARK

KEYHAM FORD

NAVY DOCKYARDS B3396

The whole of Devon and Cornwall can be reached within a 3-hour drive of the property.

R

AL NAVY AVEN OY UE

D OA

R

The City is a key commercial centre and administrative hub for the region and serves as a gateway location for the whole of Cornwall (554,000 people) and the majority of Devon (780,000 people).

PEVERELL

KR

A

NORTH PROSPECT

R PA

M

LL

A30

64

A

E US

AD RO

O

EH

IL

M

A386

Plymouth is the second largest city and commercial centre in the South West, widely renowned for its maritime history and association with being an international seaport. The city is situated approximately 45 miles south west of Exeter, 112 miles south west of Bristol and 220 miles south west of London.

T

25

B33 R

B3

96

E

RE

IV

VE

R

PE

LOCATION & CONNECTIVITY

RO AD

CAMELS HEAD

STOKE

TO PLYMOUTH CITY CENTRE & WATER FRONT MUTLEY

ROAD Newquay Airport Exeter Airport Exeter Truro Bristol London

46 miles 48 miles 55 miles 56 miles 121 miles 217 miles

RAIL Exeter Bristol London Paddington

55 mins 1hr 54 mins 2hrs 59 mins

PLYMOUTH INDUSTRIAL MARKET

− Total industrial stock for Plymouth currently stands around 10.75m sq ft. − Only 0.60% of total industrial stock is new, i.e. having been built within the last five years. An extremely low proportion compared to the national average of 4.50% and the average for similar sized UK centres of 1.10%. (PMA).

1 BURRINGTON BUSINESS PARK

BURRINGTON BUSINESS PARK

2 SISNA PARK INDUSTRIAL ESTATE

Fully let multi-let industrial/ warehouse accommodation totalling around 106,785 sq ft

3 NEWNHAM INDUSTRIAL ESTATE 4 LANGAGE BUSINESS PARK 5 PARKWAY INDUSTRIAL ESTATE

53 SISNA PARK ROAD

PLYMBRIDGE HOUSE, ESTOVER CLOSE

Tenant: Under Offer Rent: £6.75 psf (Feb 18) Area: 2,438 sq ft

Tenant: Under Offer Rent: £5.50 psf (Jan 18) Area: 9,493 sq ft

6 BREAKWATER INDUSTRIAL ESTATE 7 COXSIDE 8 OCEANSGATE

2

− There is limited new development within the city, the majority of new supply will be created at former naval dock facilities, now known as Oceansgate, and Plymouth Enterprise Park.

1

− Current vacancy stands at around 3.50%.

Availability in Plymouth fell during 2016 by 10.20% over the same period, to stand at 353,000 sq ft (Plymouth City Council).

5

3

− Demand from distributors is steadily increasing across the region with a number of current live requirements.

4

− The majority of demand for industrial space in Plymouth is for buildings of sub 15,000 sq ft and, therefore, large traditional industrial units of over 40,000 sq ft are having to be resized in order to meet occupier demand.

8 7

− Smaller units generate the largest rents with modern units of circa 1,000 sq ft hitting levels of £8.00 per sq ft, whilst larger units are now achieving rents of up to £6.00 per sq ft. − Key occupiers within the city include The Range Superstores, Devonport Royal Dockyard Limited, Newcross Healthcare Solutions Limited, and Princess Yachts International Limited.

6

Map Data©Google maps 2018

OCEANSGATE

2-4 ST MODWEN ROAD

UNIT 3 BREAKWATER IE

HEARDER COURT, BEECHWOOD WAY

DRAKES COURT, EAGLE WAY

Development providing 270,000 sq ft of prime commercial space

Tenant: Blue Tech Rent: £7.50 psf (Jan 18) Area: 6,028 sq ft

Tenant: Jet Sports Rent: £5.00 psf (Apr 16) Area: 9,694 sq ft

Tenant: Dartmouth Foods Rent: £8.00 psf (Feb 16) Area: 30,000 sq ft (9 units)

Tenant: Dash Direct Rent: £6.40 psf (Jul 16) Area: 8,439 sq ft

INDUSTRIAL & LOGISTICS INVESTMENT MARKET The investment market has witnessed significant inward yield movement over recent years with the attraction of increased occupier activity, rental growth and a limited development pipeline.

TENANT(S)

AREA (SQ FT)

WAULT (EXP/BRKS)

PURCHASER

PRICE (£M)

NIY (%)

DATE

CAPITAL VALUE

Langage One, Plymouth

Multi-let to 6 tenants

121,964

7.00 / 5.10

Columbia Threadneedle Investments

£9.500m

5.93%

2018

£77.89

Faraday Mill, Plymouth

Multi-let to 43 tenants

192,169

6.16 / 4.85

Westcore UK LLP

£12.165m

8.16%

2018

£63.30

Units 1-7 & A-G, Cheltenham

Multi-let to 9 tenants

65,084

3.57 / 3.13

Private Investor

£5.250m

6.72%

2018

£80.66

Units A1-A3 Kingfisher Way, Exeter

Smiths News Trading Limited

23,138

8.30 / 3.20

Private Investor

£2.155m

5.26%

2018

£93.14

Units 1-11 Heron Road, Exeter

Multi-let to 7 tenants

37,485

2.76 / 1.76

West Devon Borough Council

£3.500m

5.45%

2018

£93.37

Unit H1, St Modwen Road, Plymouth

Invensys Ltd

65,930

3.50

Warehouse REIT Plc

£4.290m

7.40%

2017

£65.07

PROPERTY

EPC

VAT

Energy Performance Certificates are available upon request.

It is anticipated that the sale will be treated as a going concern (TOGC).

PROPOSAL Instructions are to seek offers in excess of £6,544,000 (Six Million, Five Hundred and Forty Four Thousand Pounds) for our client’s freehold interest, subject to contract and exclusive of VAT. A purchase at this level would reflect a net initial yield of 7.50%, assuming purchaser’s costs of 6.64%, and a low capital value of £61.28 per sq ft.

A3064

CONTACTS Should you require further information or wish to arrange to inspect, please contact:

NICK ALLAN:

T: +44 (0)117 910 5282 nick.allan@cushwake.com

GEORGE LYNCH:

T: +44 (0)117 910 5266 george.lynch@cushwake.com

HUGO TILLOTSON:

T: +44 (0)139 247 7433 hugo@maze.uk.com

DISCLAIMER: IMPORTANT NOTICE

Cushman & Wakefield gives notice to anyone who may read these particulars as follows: 1. These particulars are prepared for the guidance only of prospective purchasers. They are intended to give a fair overall description of the property but are not intended to constitute part of an offer or contract.

2. Any information contained herein (whether in the text, plans or photographs) is given in good faith but should not be relied upon as being a statement or representation of fact.

3. Nothing in these particulars shall be deemed to be a statement that the property is in good condition or otherwise nor that any services or facilities are in good working order.

4. The photographs appearing in this brochure show only certain parts and aspects of the property at the time when the photographs were taken. Certain aspects may have changed since the photographs were taken and it should not be assumed that the property remains precisely as displayed in the photographs.

Furthermore no assumptions should be made in respect of parts of the property which are not shown in the photographs.

5. Any areas, measurements or distances referred to herein are approximate only.

6. Where there is reference in these particulars to the fact that alterations have been carried out or that a particular use is made of any part of the property this is not intended to be a statement that any necessary planning, building regulations or other consents have been obtained and these matters must be verified by any intending purchaser.

7. Descriptions of a property are inevitably subjective and the descriptions contained herein are used in good faith as an opinion and not by way of statement of fact.

November 2018

Design by Martin Hopkins | 02920 461233 | www.martinhopkins.co.uk 14176.11.2018