Portcullis House, Cardiff

Portcullis House Cowbridge Road East, Cardiff, CF11 9AD Freehold City Centre Office Investment

Investment Summary Cardiff City Centre, the capital city and primary economic centre for Wales.

Situated in close proximity to Cardiff Central Station, St Davids 2 Shopping Centre, Cardiff Castle, Principality Stadium, Sophia Gardens and Pontcanna.

Office building totalling 38,009 sq. ft. with secure car parking for 76 cars.

Two wings over ground and six upper floors providing suites of 2,500 sq. ft. and 6,400 sq. ft.

Freehold.

Let to the undoubted NHS covenant until 31st March 2025.

Rent, topped up to the capped review in 2022, of £313,574.20 per annum.

Extremely low rent of only £8.25 per sq ft.

NHS relocated to building in 2014 and did not exercise break in 2020.

Building internally refurbished and let in 2014.

Asset management opportunities to unlock the inherent reversion by regearing with tenant, lease renewal or further repositioning.

Low capital value of only £127 per sq ft.

We are instructed to seek offers in excess of £4,850,000 (Four Million Eight Hundred and Fifty Thousand Pounds), subject to contract and exclusive of VAT. A purchase at this level would reflect a net initial yield of 6.00%, and a capital value of £127 per sq ft assuming purchasers costs of 7.36%.

Royal Welsh College of Music and Drama

John Lewis

Pontcanna Fields

Cardiff Castle

Castle Quarter Arcades

St. David’s Shopping Centre

A4161

Sophia Gardens

Portcullis House

Principality Stadium

Central Square Cardiff Central Railway Station

Callaghan Square

The city benefits from three universities; Cardiff University, Cardiff Metropolitan University and the University of South Wales. These contribute to Cardiff’s skilled labour pool, which has one of the highest retention rates in the UK. There are 75,000 students in the city region.

London Paddington

1hr 40 minutes

Bristol

50 minutes

Birmingham New Street

2 hrs

BY AIR Cardiff International Airport lies 11 miles west of the city centre and is serviced by a rail and coach link from Cardiff Central. The airport provides internal travel to European destinations.

BY ROAD Cardiff is located 147 miles west of London. The city centre is 4 miles from junction 29-33 of the M4. The M4 is the east-west axis from London to Cardiff.

BRECON M5

A47

MONMOUTH

A465

ABERGAVENNY

17

0 A47

CIRENCESTER CHEPSTOW

41 41 40 39 38

27

M4

70

30 37

36

35

34

M4

29

28

A48

8

A4

A4

19

29

A4 M

24

48

23

NEWPORT

SWINDON

M4

M4

M4 BRISTOL CHANNEL

A350

32

M

A48

CARDIFF AIRPORT

A4232

5

CARDIFF

M

BARRY

BRISTOL

A4

WESTON-SUPER -MARE

CHIPPENHAM

A4 BRISTOL AIRPORT

A36

BATH

A39

5

A36 M

BRIDGEND

32

33

A4050

PORT TALBOT

M4

26

A4

Cardiff is forecasted to grow faster than any other UK city in population terms (26%) over the next 20 years.

A4 M

65

A4

SWANSEA

Growth in the population over the last 10 years

A40

5

MERTHYR TYDFIL

42

12%

GLOUCESTER

0

In 2017 Cardiff was in the top 3 cities in Europe in the Quality of Life in European cities survey. In 2018 Cardiff was determined as one of the top cities in the UK for business growth with a higher proportion of gazelle companies than any other UK city.

FASTEST GROWING

CHELTENHAM

ROSS-ON-WYE 0

The city’s success is based on its status as Capital city, tourism and economy. Cardiff experiences 21.3m tourist visit per annum. The largest sectors for employment growth over the past decade have been professional, scientific and technical activities alongside public services, defence, education and health.

Destination journey time by rail from Cardiff Central

A4

Cardiff is amongst the most attractive, successful and culturally prestigious cities in the UK and a highly recognised city across the globe. Cardiff has a high proportion of working aged people (65%). The city has experienced population growth of 12% over the past decade and is projected to grow by 26% over the next 20 years.

Cardiff Central is on the Great Western mainline railway and handles 13 million passengers per year. The station is located centrally and within a 10 minute walk of Portcullis House.

70

Cardiff is the capital city of Wales. It has an estimated population of approximately 346,090, and a larger Cardiff and South Wales Valleys metropolitan area population of 1.1 million residents.

BY RAIL

A3

Cardiff

Connectivity

22

MINEHEAD

A39

BRIDGWATER TAUNTON

GLASTONBURY

A36

SALISBURY

Portcullis House Portcullis House is situated on Cowbridge Road East in Cardiff City Centre. Cardiff Central Station, St Davids 2 Shopping Centre, Cardiff Castle, Sophia Gardens, The Principality Stadium, The Victorian Arcades and Pontcanna are within a 15 minute walk.

The property is positioned on the corner of Cowbridge Road East and Green Street. Cowbridge Road East is a main arterial route from the west of Cardiff to the city centre. Green Street is a cul de sac which provides access to Portcullis House and Castlebridge.

The property comprises a detached office building over ground and six upper floors. The accommodation is arranged across two wings around a central core. The south wing provides a floor plate of c2,500 sq ft. The north wing a floor plate of c6,400 sq ft.

The ground floor comprises the reception for the office accommodation. The reception provides a lobby and staircase as well as two passenger lifts that provide access to the upper office floors. There are male and female WC’s on each floor.

There is a basement car park providing 76 parking spaces accessible from Green Street via a secure entrance.

There are 12 apartments above the north wing. The apartments have been sold off to owner occupiers on a long leasehold basis.

The flats are separately accessed via a staircase on Cowbridge Road East and by car via Green Street. The flats have 20 surface car parking spaces and 6 garages above the office car parking area.

Specification The property was refurbished internally during the course of 2014 and comprises the following office specification:

| Double glazed windows

| Air conditioning

| Raised floors

| Suspended ceilings

| WC’s on alternate floors

| Two passenger lifts

Accomodation The lease defines the total net internal area of 38,009 sq ft.

The net internal floor areas, excluding the reception area, are as detailed below:

SQ M

SQ FT

Ground

828.00

8913

Floor 1

828.30

8916

Floor 2

828.25

8915

Floor 3

236.43

2545

Floor 4

237.12

2552

Floor 5

233.67

2515

Floor 6

236.85

2549

3428.62

36906

Total

Floor Plans

The property provided floor plates of 2,500 sqft and 6,400 sq ft, which are ideally suited to largest proportion of annual take in terms of size.

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ARCHITECTURAL DESIGN AND DRAWING SERVICES FULL MEASURED BUILDING SURVEYS - REFURBISHMENT CONSTRUCTION SURVEYS - LEASE PLANS - SPACE PLANNING ALL GENERAL CAD DESIGN AND DRAWING SERVICES

Tel: + 44 (0)161 282 4533 - Mobile: + 44 (0)7813027508 Email: paul@tdlcadsurveys.co.uk - Web: www.tdlcadsurveys.co.uk

Tel: + 44 (0)161 282 4533 - Mobile: + 44 (0)7813027508 Email: paul@tdlcadsurveys.co.uk - Web: www.tdlcadsurveys.co.u

Tel: + 44 (0)161 282 4533 - Mobile: + 44 (0)7813027508 Email: paul@tdlcadsurveys.co.uk - Web: www.tdlcadsurveys.co.uk

Portcullis House,

21 Cowbridge Road East, Cardiff

Project :

Portcullis House,

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Portcullis House,

21 Cowbridge Road East, Cardiff

21 Cowbridge Road East, Cardiff

21 Cowbridge Road East, Cardiff

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ARCHITECTURAL DESIGN AND DRAWING SERVICES FULL MEASURED BUILDING SURVEYS - REFURBISHMENT CONSTRUCTION SURVEYS - LEASE PLANS - SPACE PLANNI ALL GENERAL CAD DESIGN AND DRAWING SERVICES

ARCHITECTURAL DESIGN AND DRAWING SERVICES FULL MEASURED BUILDING SURVEYS - REFURBISHMENT CONSTRUCTION SURVEYS - LEASE PLANS - SPACE PLANNING ALL GENERAL CAD DESIGN AND DRAWING SERVICES

Tel: + 44 (0)161 282 4533 - Mobile: + 44 (0)7813027508 Email: paul@tdlcadsurveys.co.uk - Web: www.tdlcadsurveys.co.uk Project :

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Tel: + 44 (0)161 282 4533 - Mobile: + 44 (0)7813027508 Email: paul@tdlcadsurveys.co.uk - Web: www.tdlcadsurveys.co.uk Project :

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ARCHITECTURAL DESIGN AND DRAWING SERVICES FULL MEASURED BUILDING SURVEYS - REFURBISHMENT CONSTRUCTION SURVEYS - LEASE PLANS - SPACE PLANNING ALL GENERAL CAD DESIGN AND DRAWING SERVICES

Tel: + 44 (0)161 282 4533 - Mobile: + 44 (0)7813027508 Email: paul@tdlcadsurveys.co.uk - Web: www.tdlcadsurveys.co.uk

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ARCHITECTURAL DESIGN AND DRAWING SERVICES FULL MEASURED BUILDING SURVEYS - REFURBISHMENT CONSTRUCTION SURVEYS - LEASE PLANS - SPACE PLANNING ALL GENERAL CAD DESIGN AND DRAWING SERVICES

Tel: + 44 (0)161 282 4533 - Mobile: + 44 (0)7813027508 Email: paul@tdlcadsurveys.co.uk - Web: www.tdlcadsurveys.co.uk

Portcullis House,

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Tenure

Management

The property is freehold.

There is a service charge in place for the building. The tenant pays 100% of proportion that relates to the office accommodation. There is a service charge cap of ÂŁ128,524.78 per annum ÂŁ3.38 per sq ft. the service charge cap is subject to an annual RPI increase. There is no shortfall. There are no shared services with the residential. There is a residential management company that manages the contribution to the building service charge.

There are 12 apartments. The apartments have been sold off to owner occupiers on a long leasehold basis. The flats are separate accessed via a staircase on Cowbridge Road East and by car via Green Street. The flats have 20 surface car parking spaces and 6 garages above the office car parking area.

2 Lodge

Slopi

51

PH ple Te m ity eC Th

2

21

SM

CR

1 to 12 Be lgra ve Co urt

7.6m Ken

Portcullis

neth Poll ard Ho u se

12

House

COWBRIDGE ROAD

13

Qu ebe c Ho u se

El Sub Sta

9

Suth

GR E 12

rt Cou

23

View

22

Arg yle Ho u se

Park

EN

1

ST R

EE T

erla nd Ho u se

2

Posts

EAST

10.1m

Targ et Ho u se

1 to

24

26 28

35

M AR K ST REE T

21 31

Path

34

32b

15

Warehouse

13

2

32

1

13

31 1

6

53

57 59

25

ry ason

LB

ng m

7.9m

Covenants NHS Wales is the publicly funded healthcare system in Wales and one of four systems that make up the National Health Service in the United Kingdom. NHS Wales provides services through seven health boards and three NHS trusts.

Velindre NHS Trust is a specialist provider of cancer services. It runs the Velindre Cancer Centre and Welsh Blood Service and incorporates the NHS Wales Information Service and the NHS Wales Shared Services Partnership.

The trust relocated to Portcullis House in 2014. The building is used

by NHS Wales Information Services (NWIS). NWIS is the national organisation delivering technology and digital health systems and services for patient care.

Tenancy The building is let as a whole to Velindre NHS Trust on a lease from 8th December 2014 expiring on the 31st March 2025. The passing rent is £205,248.60 per annum.

There is an open market review on the 8th December 2022. The open market reviews is on the basis of open market rent of the building as a whole for a term of 10 years (5 year break).

The review is subject to a cap of £313,574.20 per annum ( £8.25 per sq. ft. on agreed square footage of 38,009 sqft). The vendor will be topping up the rent to the review date.

The tenant has had the benefit of a break option between 31st March 2020 and 31st March 2021, subject to six months notice. The tenant has not exercised their break.

https://nwis.nhs.wales/about-us/

Occupational Market

Total availability including out of town and Cardiff Bay is 1.1m  sq ft, City centre availability is extremely low as a result of a loss of around 175,000 sq. ft. through change of use to student accommodation.

1,600,00

Availability (sq ft)

1,400,00

Cardiff is the most significant office market Wales and in the top 10 UK centres.

The market comprises approximately 11 million sq. ft. of total stock in the city centre, bay and out of town. City centre five year average take up is 490,000 sq ft. Total city centre take up in 2019 was 363,000 sq ft.

1,00,000 800,00 600,00 400,00 200,00

CARDIFF WIDER MARKET TAKE-UP

Q3

2020

2019

2018

2017

2016

2015

2014

2013

2012

2011

2010

2009

2008

2007

Out of Town

2006

0

Cardiff Bay

2005

City Centre

1,200,00

800,00 700,00

Occupiers

500,00 400,00 300,00

TMT represented the largest type of occupier demand in the city centre in 2019. This has been the case over the past two years.

200,00

2%

2% 4%

2020

2019

2018

2017

2016

2015

2014

2013

2012

2011

2010

2009

0

Q1 - Q3

100,00 2008

Take up (sq ft)

600,00

2%

28%

4% 4% 4% 6% 7% 10%

12%

14%

28%

TMT

14%

Public Services, Education & Health

12%

Insurance & Financial Services

10%

Business & Consumer Services

7%

Professional

6%

Banking

4%

Charities & Associations

4%

Property Company, Development & Construction

4%

Engineering

3%

Private Individual

2%

Biosciences

2%

Manufacturing & Industry

2%

Extraction & Utilities

Rental Evidence The headline rent for the city now stands at £25 per sq ft. Cardiff has experienced 14% headline rental growth since 2012. RealFor forecast an average rental growth rate of 15-20% pa over next five years.

DATE

PROPERTY

SIZE

TENANT

RENT PSF

TERMS

RENT FREE

Q4 2020

101 St Mary Street

6,461

Hamlyn Williams

£18.00

5 year lease

13 months

Q3 2020

Westgate House

2,850

Sero Life Ltd

£20.00

5 year lease 3 year break

3 months

Q4 2019

2 Kingsway

14,156

Monzo Bank

£22.00

5 year lease 3 year break

9 months (6 + 3 after break)

Q4 2019

2 Castlebridge

2,631

NHS Wales Infomatics Services

£15.20

5 year lease

18 months

Q4 2019

Brunel House, Fitzalan Place

14,130

Starling Bank

£15.43

10 year lease 5 year break

18 months

Q3 2019

2 Kingsway

6,092

Monzo Bank

£23.00

4.5 year lease 2.5 year break

7 months (4 + 3 after break)

Recent comparable lettings include

Investment Market Cardiff is a top 10 regional office market in the UK. Stakeholders in the city centre office market are made up of UK Institutions, European Institutions and Middle Eastern Capital.

Recent investment comparables include

PROPERTY

DATE

SIZE (SQ FT)

PRICE

NET INITIAL YIELD

PRICE (PSF)

TERM CERTAIN

PURCHASER

Regent House, Cheltenham

Apr-20

10,200

£4.00m

5.60%

£392

5

CEW Capital

Refurbished. Freehold

2 Kingsway, Cardiff

Apr-20

39,246

£13.00m

6.25%

£331

3

Delancey

Refurbished. Freehold

No 4 Capital Quarter, Cardiff

Feb-20

95,248

£33.40m

6.00%

£351

8

Greenridge

6 Park Street Cardiff

Nov-19

50,983

£10m

5.60%

£196

5

UKRO

COMMENT

New build. Freehold 2008 built. Long Leasehold

Portcullis House Cardiff, CF11 9AD

EPC’s

Portcullis House

EPC available on request.

Asset Management Opportunities

C O N TAC T

Scenario 1

Lease renewal in 2025. Estimated rental value of £13.00 per sq ft

Scenario 2

Lease regear with NHS in 2022/23. Market rent of £15.50 per sq ft

Scenario 3

Refurbish to create a creative environment, amenities, exposed ceiling finish. Market rent of £20.00 per sq. ft.

Ross Griffin Tel: +44 (0)29 2036 8961 Mob: +44 (0)7972 000113 Email: rgriffin@savills.com

Andrew Phillips Tel: +44 (0)117 9102354 Mob: +44 (0)7972 000112 Email: adphillips@savills.com

Scenario 4 Refurbish to create a creative environment, amenities, exposed ceiling

finish and operate as co working/serviced office. Desk rates at £250 per month.

Proposal We are instructed to seek offers in excess of £4,850,000 (Four Million Eight Hundred and Fifty Thousand Pounds), subject to contract and exclusive of VAT. A purchase at this level would reflect a net initial yield of 6.00%, and a capital value of £127 per sq ft assuming purchasers costs of 7.36%.

Important Notice Savills, their clients and any joint agents give notice that: 1. They are not authorised to make or give any representations or warranties in relation to the property either here or elsewhere, either on their own behalf or on behalf of their client or otherwise. They assume no responsibility for any statement that may be made in these particulars. These particulars do not form part of any offer or contract and must not be relied upon as statements or representations of fact.

2. Any areas, measurements or distances are approximate. The text, images and plans are for guidance only and are not necessarily comprehensive. It should not be assumed that the property has all necessary planning, building regulation or other consents and Savills have not tested any services, equipment or facilities. Purchasers must satisfy themselves by inspection or otherwise. Rents quoted in these particulars may be subject to VAT in addition.

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