Exeter EX4 3NE ATTRACTIVE HIGH STREET RETAIL INVESTMENT WITH SIGNIFICANT DEVELOPMENT POTENTIAL - Allsop
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232-234 HIGH STREET
exeter
EX4 3NE
ATTRACTIVE HIGH STREET RETAIL INVESTMENT
WITH SIGNIFICANT DEVELOPMENT POTENTIAL
232-234 HIGH STREET
Attractive High Street Retail Investment
exeter EX4 3NE with significant development potential
INVESTMENT CONSIDERATIONS Exciting opportunity to acquire a prime
• Exeter is a historic Cathedral and University High Street retail investment with
City in the South West of England
• Prime pitch fronting the High Street, directly
18,535 sq ft of extensive upper parts
opposite Princesshay Shopping Centre
benefitting from high footfall
which would be well suited to residential
• The property comprises an attractive retail conversion, subject to planning
parade of three well configured retail units
providing a total of 41,945 sq ft
• Total rental income of £691,000 per annum
• Clarks are currently paying 4% of turnover,
presenting an immediate opportunity to
increase the passing rent
• Fully let to Lloyds TSB Bank Plc,
C&J Clark International Ltd and
Vision Express (UK)
• Majority of income secured to Lloyds TSB
Bank Plc for a further 6.92 years
• Vision Express have served a Section 26
notice to renew
• AWAULT of 4.89 years to expiry (no breaks)
• Medium term potential to redevelop the
upper parts to provide alternative uses, subject
to vacant possession and planning consent
• Long leasehold expiring 14/12/2124 at
a peppercorn rent
PROPOSAL
• We are instructed to seek offers in the
region of £8,000,000 (Eight Million
Pounds) subject to contract and
exclusive of VAT, a purchase at this level
reflects an attractive net initial yield of
8.1% assuming standard purchasers
costs of 6.67% and a low capital rate
of £191 psf.
Site outline for identification purposes only.
232-234 HIGH STREET
Attractive High Street Retail Investment
exeter EX4 3NE with significant development potential
MANCHESTER
M1
NOTTINGHAM
■
DERBY
■
BURTON
UPON TRENT
■
M6
M1
M11
LOCATION
M5
M40 Exeter is a historic Cathedral and University City located in the south west of England. The city is the main
A419 commercial centre for the county of Devon being located approximately 45 miles north east of Plymouth,
83 miles south west of Bristol and 174 miles south west of London.
M4 CARDIFF
BRISTOL
M4 LONDON
BATH A34
M25 M20 The city benefits from excellent transport links being situated adjacent to Junctions 29,30 and 31
A36
M3
BRIDGWATER M23 A26
of the M5 Motorway all providing direct access to the city centre. The A30 runs through Exeter
A3
M5 providing access to the A303 to the east, a trunk road connection to the M3 motorway and thereon
A303
TAUNTON A23
SOUTHAMPTON
to London whilst providing direct access to Cornwall to the west. The A38 (Devon Expressway) is
PORTSMOUTH
BRIGHTON situated to the south providing direct access to Plymouth.
EXETER A30
BOURNEMOUTH
A30
Exeter benefits from two mainline railway stations, St David’s and Central, both of which have direct
NEWQUAY TORQUAY
A38 services to numerous towns and cities within the national rail network including regular services to London
PLYMOUTH
TRURO Paddington and Waterloo with a fastest journey time of 2 hours and 8 minutes to London Paddington.
PENZANCE FALMOUTH
Exeter Airport is located 6 miles to the east of the city centre via the A30 and provides a range of
domestic and international flights.
232-234 HIGH STREET
Attractive High Street Retail Investment
exeter EX4 3NE with significant development potential
Exeter is one of the fastest growing cities DEMOGRAPHICS
in the country in terms of population,
housing, new business start-up Primary catchment
population of
and employment.
434,000
6th Highest
employment
level in the UK
Projected to see
significantly above average
growth in population over
the period 2019-2024
University of Exeter ranks
6th in the UK
9th in Europe
Students enrolled
for 2020/1
27,296
Exeter - A strong commercial centre
Exeter has an affluent catchment which ranks 18th out of 200 PROMIS centres in terms of total retail expenditure
and ranks 6th in terms of forecast growth in retail expenditure between 2019 and 2024. The population is
boosted significantly by tourism and the large student population. In 2018 the total number of visitors to the city,
both day trips and overnight stays was 2,530,000, a 9% increase on 2017.
Exeter is currently in a phase of major housebuilding with approximately 12,000 homes estimated to be built
by 2040 within the city as part of the ‘Liveable Exeter’ Local Plan. This will see approximately £10bn of private
money and £2bn of public funds invested in the region.
Exeter University is one of the top performing Russell Group Universities in the country, the student population
has shown a 24% increase over the past 5 years and continues to see further investment driving future growth
in the City.
232-234 HIGH STREET
Attractive High Street Retail Investment
exeter EX4 3NE with significant development potential
RETAILING IN EXETER SITUATION
Exeter is a well-established retail centre providing The property is situated in a prominent
Devon’s primary shopping destination with a position along the north west side of
total floor space in excess of 1.39 million sq ft. the pedestrianised High Street directly
The prime retail pitches are located within the opposite to the main entrance to
pedestrianised section of the High Street between the Princesshay Shopping Centre
the Guildhall Centre, John Lewis department store which forms Exeter’s prime retailing
and Princesshay Shopping Centre. thoroughfare.
Princesshay Shopping Centre opened in 2007 The property benefits from a large
providing over 500,000 sq ft of retail and restaurant frontage onto the High Street with a bus
space with key retailers including Next, Zara, H&M, stop directly outside the property. Little
Reiss and Apple. Plans are underway to extend Queen Street to the rear of the property
Princesshay, replacing the former bus station to provides access to the public library
provide a mixed-use scheme that will include and residential dwellings.
a cinema and leisure centre.
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© Crown Copyright, ES 100004106. For identification purposes only.
232-234 HIGH STREET
Attractive High Street Retail Investment
exeter EX4 3NE with significant development potential
FUTURE DEVELOPMENT POTENTIAL
RESIDENTIAL DEVELOPMENT HOTEL DEVELOPMENT
We are of the opinion that the separate access, current use of the upper parts and strong demand for residential The hotel market in Exeter is ranked the third most likely city to recover
quickly from the effects of COVID-19 due to its large domestic travel
accommodation, offers a realistic and feasible opportunity for conversion of the upper parts to alternative uses.
base, as well as its pull as a popular leisure destination within the UK.
The upper parts of all three units are let to Lloyds and total 18,535 sq ft. that flats in the building would likely achieve the following rents:
Given the self contained nature of the upper parts and town centre
Subject to planning and the necessary consents, they have potential to
location, we are of the view the upper parts lend themselves to
be redeveloped to offices, student or private residential accommodation. Studio £135-£145 per week
conversion to a hotel.
Approximately 10% of all houses in Exeter are occupied by students, 1 Bed £145-£165 per week
whilst just under half of Exeter’s private rental properties are let to students. Our clients have been approached by a number of hotel operators
In addition, the city’s population remains young, with 36% comprising 2 Bed £290-£300 per week in the past with a view to obtaining the necessary consents to convert
individuals aged between 15 and 34. and operate as a hotel.
Residential Sales Market in Exeter has higher than average
A prime city centre location would attract demand from both
property prices with an average asking price of £306,496.
students and young professionals providing strong potential for future
redevelopment. We understand from speaking with local agents Average High Street Flat Price £260,000 (£350 psf).
Outline for indicative purposes only.
232-234 HIGH STREET
Attractive High Street Retail Investment
exeter EX4 3NE with significant development potential
OFFICE MARKET OVERVIEW FLOOR PLANS
Exeter is the main regional centre for Devon with strong financial, business
and public sector services in occupation. Key employers in the city include
Met Office, EDF Energy and Sitel.
Vacancy rates in the city centre are particularly low at c.1.5% owing to a lack LIFT
of available stock arising from repurposing of assets and consistent occupier
LIFT
demand. There is a lack of quality accommodation in the market suggesting
a need for further office development within he city centre in the coming years.
Average asking rents in the city centre are approximately £13 psf with headline
rents seeking £19 psf. Third Floor Fourth Floor
LIFT LIFT
LIFT LIFT
VOID
First Floor Second Floor
LIFT LIFT
LIGHTWELL
LIGHTWELL PLANT
LIFT
LIFT
LIFT
LIFT
LIFT
LIFT
LIFT LIFT
View from Little Queen Street
Ground Floor Basement Floor
Vacancy rates in the city centre are particularly Key
low at c.1.5% owing to a lack of available stock n Lloyds demise n Clarks n Vision Express n Lifts
232-234 HIGH STREET
Attractive High Street Retail Investment
exeter EX4 3NE with significant development potential
TRADING PERFORMANCE
From our conversations with the
tenants we understand the tenants
trading performance pre Covid
to be as follows:
• Lloyds - 4th busiest branch in the
UK outside of London and the
regional branch for the South West
• Vision Express – the property sits
within the top 10% of the 600
stores in terms of trading
• Clarks – a top quartile trading
store pre Covid
DESCRIPTION TENANCY AND ACCOMMODATION SCHEDULE
The property comprises an attractive building Demise Tenant NIA NIA Lease Lease Rent Rent Comments
developed in the 1950’s providing three well Sq ft Sq m Start Expiry Review (£ p.a.)
configured retail units fronting the High Street
232 Vision Express Ground 3,379 313.9 16/02/2012 15/02/2022 £230,000 The tenant has served a Section 26 to renew.
totalling 41,945 sq ft. (UK) Ltd
ITZA 1,173 109
234 High Street is occupied by Lloyds and is
arranged to provide ground floor sales Basement 2,130 197.9
accommodation with ancillary accommodation Total 5,509 511.8
on the basement and the three upper floors which
233 C & J Clark Ground 2,415 224.4 14/01/2003 13/01/2023 14/01/2018 £0 4% of turnover. For the year ended February
oversail the neighbouring units, 232 and 233. International Ltd 2020, the turnover was £2,254,000, based
ITZA 1,054 98
232 and 233 High Street are arranged to provide on a rent of 4% of turnover, the per annum
Basement 3,598 334.3 income could be in the region of £90,160. Pre
ground floor sales accommodation with ancillary
Covid, the property was a top quartile trader.*
accommodation in the basement. Total 6,013 558.6
234 Lloyds TSB Ground 6,724 624.7 23/03/1998 22/03/2028 23/03/2018 £461,000
Bank Plc
TENURE ITZA 1,781 166
The property is held long leasehold expiring Basement 5,164 479.8
14/12/2124 at a peppercorn rent. First 7,246 673.2
Second 9,106 846.0
PLANNING Third 1,707 158.6
Local Planning Authority: Exeter City Council Fourth 476 44.2
www.exeter.gov.uk/planning-services Total 30,423 2,826.4
We have been informed by the Local Planning Total 41,945 3,896.82 £691,000
Authority that the property is not listed and is
situated within the Central Conservation Area. *The property was categorised as a B6 lease in the CVA and is subject to rental payments of 4% of turnover, subject to a minimum rent payment of base rent in the 2nd & 3rd years of the rent
concession period. Further information is available upon request.
232-234 HIGH STREET
Attractive High Street Retail Investment
exeter EX4 3NE with significant development potential
COVENANT INFORMATION
Lloyds Bank PLC Vision Express (UK) Limited
C& J Clark International Ltd
Score 93 Very Low Risk Score 60 Below Average Risk
Score 100 Very Low Risk
Lloyds Bank PLC was founded in 1765 and is the leading British Retail and Commercial Bank. Vision Express operate from 599 Vision Express stores across the UK and
Clarks have been shoemakers since 1825, and now have 1,400
They operate multiple brands through three core divisions; Retail, Commercial Banking and Ireland. These are both big city locations, local high street stores and now
stores in over 75 countries around. The company entered a CVA
Insurance and Wealth. They committed to support businesses with a £2 billion COVID-19 fund, following the acquisition of Tesco Opticians in 2017, they are also in larger
in November 2020. The subject property is a category B6.
granting more than 50,000 repayment holidays and overdraft extensions to businesses. Tesco stores.
31 Dec 2017 31 Dec 2018 31 Dec 2019 31 Dec 2017 31 Dec 2018 31 Dec 2019
03 Feb 2018 02 Feb 2019 01 Feb 2020
Turnover - - - Turnover £261,954,000 £324,319,000 3325,279,000
Turnover £1,539,900,000 £1,468.800,000 £1,374,800,000
Pre-Tax Profit £5,035,000,000 £4,929,000,000 £3,474,000,000 Pre-Tax Profit (£1,153,000) (£16,533,000) (£19,787,000)
Pre – Tax Profit £19,700,000 (£84,400,000) (£21,500,000)
Net Worth £47,675,000,000 £36,484,000,000 £34,583,000,000 Net Worth £22,858,000 £15,736,000 £7,114,000
Net Worth £390,400,000 £273,300,000 £268,000,000
EPC
232 High Street has an EPC Rating of C (67)
233 High Street has an EPC Rating of C (65)
234 High Street has an EPC Rating of C (70)
VAT
The property has been elected for VAT and it is anticipated that the sale
will be treated as a Transfer of a Going Concern (TOGC).
ANTI-MONEY-LAUNDERING
A successful bidder will be required to provide information to satisfy the
AML requirements when Heads of Terms are agreed.
DATAROOM
For access to the Allsop dataroom please use the following link:
https://datarooms.allsop.co.uk/register/HighStreetExeter
PROPOSAL
Offers sought in excess of £8,000,000 (Eight Million Pounds),
subject to contract and exclusive of VAT, a purchase
at this level reflects a net initial yield of 8.1%
assuming standard purchasers costs of 6.67%
and a low capital rate of £191 psf.
For further information or to make arrangements for viewing please contact:
Jeremy Hodgson Lottie Hayward Freddie Foley
07850 976 116 07817 549 237 07765 982 637
jeremy.hodgson@allsop.co.uk lottie.hayward@allsop.co.uk freddie.foley@allsop.co.uk
allsop.co.uk
Misrepresentation Act: 1. Allsop LLP on its own behalf and on behalf of the vendor/lessor of this property whose agent Allsop LLP is, gives notice that: (a) these particulars do not constitute in whole or in part an offer or contract for sale or lease; (b) none of the statements contained in these particulars as to the property are to be relied
on as statements or representations of fact; and (c) the vendor/lessor does not make or give, and neither Allsop LLP nor any of its members or any person in its employment has any authority to make or give, any representation or warranty whatsoever in relation to the property. The only representations, warranties, undertakings and
contractual obligations to be given or undertaken by the vendor/lessor are those contained and expressly referred to in the written contract for sale or agreement for lease between the vendor/lessor and a purchaser or tenant. 2. Prospective purchasers or tenants are strongly advised to: (a) satisfy themselves as to the correctness of
each statement contained in these particulars; (b) inspect the property and the neighbouring area; (c) ensure that any items expressed to be included are available and in working order; (d) arrange a full structural (and where appropriate environmental) survey of the property; and (e) carry out all necessary searches and enquiries. Allsop
is the trading name of Allsop LLP. Design CommandD www.commandHQ.co.uk 07.21You can also read
