Solihull Gate Retail Park - A Prime Retail Investment Opportunity - ENTER
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Solihull Gate Retail Park ENTER Stratford Road (A34), Solihull, Birmingham, B90 4BA A Prime Retail Investment Opportunity
Investment Summary
1.
Location – Solihull is one of the UK’s most affluent towns and
one of Birmingham’s most attractive residential suburbs.
Place Making – This park forms part of Solihull’s principal out of
town retail hub, serving not only Solihull but the wider south-east
Birmingham conurbation.
Captive Catchment – Within a 10 minute drive time, there is in
excess of 100,000 people. In addition there are over 22,800 cars
passing the property every week, which is highly visible from the
A34, (Stratford Road).
44,963 sq ft Floor Space – A resilient and flexible layout with the
ability to either sub-divide or combine units.
Strong Trading Profile – All the occupiers report strong trading in
what is a key location.
Institutional Income Stream – Secured from strong covenants
with a WAULT of 6.6 years to expiry.
Price – A price is sought of £18,700,000, reflecting an attractive
net initial yield of 7% after allowing for purchaser’s costs of 6.74%.
Investment Aerial View Location Demographics Local Retail Description ERV, Investment VAT / EPC
Summary Economy Warehousing Tenure, Planning Tenant’s Comparables Proposal,
in Solihull Tenancy Schedule Covenants Contact
1
2.
SEARS RETAIL PARK
SOLIHULL RETAIL PARK
B4102
SOLIHUL
SOLIHULLGATE
GATERETAIL
RETAIL PARK
A34
Investment Aerial View Location Demographics Local Retail Description ERV, Investment VAT / EPC
Summary Economy Warehousing Tenure, Planning Tenant’s Comparables Proposal,
in Solihull Tenancy Schedule Covenants Contact
2
Stone
Uttoxeter DERBY 25 Gra
3.
A50 A6
A51 24
14 Burton upon EAST
Stafford A515 Trent MIDLANDS
A38
Location
A5
A42
Newport 13 Rugeley 23
07
A45 M1 A6 A6
06
8
7 6 5 12 Cannock 11
22
Solihull is the most affluent town in the west Telford M54 11
M42 LEICESTER
Midlands conurbation, located approximately 8
2
M6(T)
Walsall 21
A4
miles south-east of Birmingham and 18 miles west WOLVERHAMPTON 10 Wigston
7
M69
8 7 Hinckley
of Coventry.
A6
9
West Bromwich M6 Nuneaton
2
Dudley 1 6 5 8
1
M1 A427
2
The town benefits from excellent road and rail communications, Halesowen BIRMINGHAM 3
BIRMINGHAM 20
being within 2 miles of junctions 4 and 5 of the M42 motorway, 3 6 2
M6
M42
which links with the M40, M5 and M6. Rail services to London Kidderminster M5 5 COVENTRY
1 19
4 4
Rugby
Marylebone have an approximate fastest journey time of 1 hour and 1 2
3
18 A508
Bromsgrove M42 M45
20 minutes. There are also quick (50 minutes) and frequent A448 SOLIHULL
M40
16
Leamington
17
A449
(96 trains per day) rail services between Solihull and Birmingham 5 Redditch Spa
15 14 A
(Snow Hill). M5
A441 13 Daventry
A435 16
A44 6 A46
Unlike central Birmingham, the industrial revolution largely A442 A429 12 15
7
passed Solihull by and the town developed in the 20th century, A4
112 103 M1
A4
principally as an attractive and affluent residential suburb.
6
A5
A4
A5
Great
08
A43
8 Malvern EveshamsR Banbury
d
A44
A438 os r 11
sC
Hereford r man B4102 A43 Milto
8 Sha A4
1 A44 22 Keyne
46
Stra
B4
A
Solihull
tfor
102
2 9
Da
65
02
A4 Tewkesbury
d
5
nfo
3
Shirley
B4
A4
Roa
M50
rd L
M5 10
d
A4
n
A49 4 3 Lo 10 4
ng
mo
GLOUCESTERSHIRE
M40
A40
re
Rd 11 Cheltenham Bicester
Gloucester
W i d n ey
A4
9 1
40
4
A3
A A436
l Rd
Ma
Aylesbury
02 Kidlington
no
Wi A40
h Hal
41
9
dn Witney
2
rR
ey
A4
A4
12 Ln
B
d
A4
Monkspat
17
A40 0 Oxford
13 Stroud A4
8
A4
0 Thame
8 A418
49
M5 A419 Cirencester 7
A4 M42
W i d n ey L n
A4010
A420 Abingdon
SOLIHULL GATE
Solihull is one of the UK’s most affluent
Cwmbran 6
5 W
Chepstow RETAIL PARK A
14 hR Monkspath Didcot M40
d
2 eat 43
3 41
towns and one of Birmingham’s most M48 9
24 1 sH A
Marlo
en
Newport 23
ck
B410 2
St
Di
attractive residential suburbs.
ra
tfo
rd
Ro
Dickens Heath ad
W
id
ne
yR
d
Investment Aerial View Location Demographics Local Retail Description ERV, Investment VAT / EPC
Summary Economy Warehousing Tenure, Planning Tenant’s Comparables Proposal,
in Solihull Tenancy Schedule Covenants Contact
3
Demographics
4.
Solihull is the most affluent town in the West The Solihull CACI 10 minute drive time also reports on weekly
Edgbaston South Yadley
Midlands and is one of the most affluent areas in the expenditure and generally those categories under “Furnishings, Balsall Heath
Household Equipment and Routine Household Maintenance”
UK, outside London. The ‘You Switch Quality of Life Bicken Hill
show above average spending, as compared to the UK average.
Index’ named Solihull as ‘The Best Place to Live’ in
the United Kingdom. In terms of households, CACI classify some 56.4% as “Affluent Yardley Wood
Brandwood
Solihul
Achievers” with only 10% and 4% classed as “Financially Stretched”
PMA class Solihull as a “Regional Centre” on the basis of the volume and “Urban Adversity”, respectively.
and quality of its town centre provision. The total population within the Hollywood
Dickens Heath M42
Solihull Primary Retail Market Area is estimated at 240,000 people, The “ACORN” group profile report that out of a 10 minute catchment M5
Dorridge
Wythall Green
of which PMA estimates 225,000 form the consumer base of 107,000 people, 31,400 could be described as “Executive Wealth”
SOLIHULL GATE
of Solihull. (236% of the UK average Index), some 24,700 as “Mature Money” RETAIL PARK
M42 Hockley Heath
(254%) and finally 14,500 as “Successful Suburbs” (220%).
The CACI 10 minute drive time for the subject property gives a total Wood End
M40
population of 104,000 people. The more affluent social grades AB are All the statistics show that Solihull has a most affluent catchment
significantly over represented within the catchment at 51%, in excess population. For good reason it is generally regarded as
of the UK average, with the C1 social grade also above the national Birmingham’s most attractive and desirable residential suburb.
rate. In contrast the least affluent social grades C2, D2 and DE are
relatively under represented. The 10 minute drive time
The CACI socio-economic classifications are set out below for the 10 minute drive time:
NS Socio Economic Classification Profile % for Area % for Base Index 0 100 200
All People aged 16- 74 74,316 100 100 100
1. Higher Managerial, administrative and professional occupations 11,145 15.0 10.1 148
Solihull has been named as
1.1 Large employers and higher managerial and admin occupations 2,412 3.2 2.3 142 ‘The Best Place to Live’ in the UK.
1.2 Higher professional occupations 8,733 11.8 7.8 150
(You Switch Quality of Life Index)
2. Lower managerial, administrative and professional occupations 18,343 24.7 20.8 119
3. Intermediate occupations 11,157 15.0 12.8 118
4. Small employers and own account workers 6,815 9.2 9.2 99
5. Lower supervisory and technical occupations 4,060 5.5 7.1 77
6. Semi-routine occupations 8,655 11.6 14.2 82
7. Routine occupations 5,089 6.8 11.3 61
8. Never worked long-term unemployed 3,291 4.4 5.5 80
9. Full time students / SEC unclassified 5,761 7.8 9.0 86
Investment Aerial View Location Demographics Local Retail Description ERV, Investment VAT / EPC
Summary Economy Warehousing Tenure, Planning Tenant’s Comparables Proposal,
in Solihull Tenancy Schedule Covenants Contact
4
Local Economy
5.
The town’s accessibility makes it an attractive location Excellent road communications have made Solihull an attractive
location for distribution/transport firms. Furthermore, there is a
for office occupiers, many of whom are located on
successful conference industry based around the NEC.
out of town business parks.
Birmingham International Airport lies just to the north of the catchment
The service sector as a whole accounts for 63% of the total
and an extension to the runway was completed in 2014, now making
employment in Solihull above the national average.
long-haul flights possible.
The professional and business sector includes St James Place and
The manufacturing sector in Solihull accounts for 10% of the total
Prime Chartered Accountants.
employment with the automotive industry of particular significance.
Furthermore, National Grid Transco and NPower have large offices Both Jaguar Land Rover and BMW operating major facilities within
in the town centre. the area. JLR has recently revealed plans to expand its Solihull factory
in order to facilitate the development of electrical equipment for
The ICT sector is well represented on the M42 business parks,
the company’s cars and plans to hire a further 1,000 employees in
especially Birmingham Business Park and Blythe Valley with occupiers
addition to the 10,000 staff currently employed. The manufacturer has
including Fujitsu, Nokia, Siemens, Oracle and ASOS. Virgin Media
also submitted plans to build a 1m sq ft logistics operations centre at
announced at the start of 2015 that they plan to create 1,000 new
Damson Parkway, near the Solihull factory.
apprentice positions at its Eagle Court facility as part of a nationwide
expansion. Additionally Blythe Valley Park also accommodates a In March 2018, the local unemployment count was 0.7%
number of large offices for international construction/engineering of the population aged 16-64, as compared to the national
firms such as Enzen, Kier Group and Arup. unemployment count at 1.1%.(PMA)
Investment Aerial View Location Demographics Local Retail Description ERV, Investment VAT / EPC
Summary Economy Warehousing Tenure, Planning Tenant’s Comparables Proposal,
in Solihull Tenancy Schedule Covenants Contact
5
Retail Warehousing in Solihull
6.
Total retail warehouse supply for Solihull is Finally, adjoining Solihull Retail Park and the former Toys ‘R’ Us, but
estimated at 568,000 sq ft with an overall provision fronting onto Stratford Road, is a large state-of-the-art Sainsbury’s
of some 80,000 sq ft which forms the principal food offer for the
per household below the PROMIS average. In
surrounding area.
particular, the DIY and furniture/furnishing are
relatively under represented. On Stratford Road there are some solus retail warehousing units
and notably a 27,000 sq ft store recently occupied by Sports Direct
The vast majority of retail warehousing is situated around the subject diagonally opposite the subject property, and fitted out to the
property, adjoining Marshall Lake Road (B4102) close to its junction retailer’s latest format.
with Stratford Road (A34).
At the roundabout junction between Marshall Lake Road and
Immediately behind the subject property is Solihull Retail Park Stratford Road, is an impressive Porcelanosa destination store.
totalling 190,000 sq ft anchored by B&Q, who extended in 2012,
All in all, this immediate location should provide investors with
together with Currys / PC World. Other tenants include Halfords,
the ideal scenario of being situated in a strong and established
Pets at Home, Hobbycraft, Dreams and SCS.
retail pitch which is relatively under supplied as compared to the
Adjacent to this is Sears Retail Park totalling 125,000 sq ft, which strength of the catchment. Furthermore, we are not aware of any
is generally occupied by “softer” retailers including Boots, Argos, further retail developments proposed which would materially
M&S Foodhall, Homesense and TK Maxx. increase the supply of accommodation.
Adjoining this is a new format Next lifestyle store of 30,000 sq ft
which was completed in June 2014.
LOCAL OCCUPIERS »
Adjacent to the Sears Retail Park is a former Toys ‘R’ Us unit of 44,000
sq ft which was owned freehold by the related property company.
We understand however there is good interest in a sub-division of
this unit with the main area going to one of the discount
food retailers.
44,963 sq ft Floor Space – a resilient
and flexible layout with the ability to
either sub-divide or combine units.
Investment Aerial View Location Demographics Local Retail Description ERV, Investment VAT / EPC
Summary Economy Warehousing Tenure, Planning Tenant’s Comparables Proposal,
in Solihull Tenancy Schedule Covenants Contact
6-7
7.
SOLIHUL GATE RETAIL PARK
Investment Aerial View Location Demographics Local Retail Description ERV, Investment VAT / EPC
Summary Economy Warehousing Tenure, Planning Tenant’s Comparables Proposal,
in Solihull Tenancy Schedule Covenants Contact
6-7
Description Tenure
8.
Freehold as delineated in red on the plan 6 3
14
7 Solihull
11
AY
HA 2
R 15 Retail Park
W
W 10
OO
RD
opposite. D
FO
GR
AL
The development comprises an attractive terrace currently arranged
OV 8
CH
E 1 16 4
5
9 12
Ar
1
Planning Consent
12
4
d en
as 4 units totalling 44,963 sq ft. The development is currently
a
d
3
ale
6
3
9
1
4
arranged in unit sizes between 10-15,000 sq ft. It was completed
7
The development benefits from a “standard
5
2
El Sub Sta
in May 2007 to a high specification to include full glazing to the
30
8
bulky goods” planning consent, permitting
ale
10
uin 16
nd
a
to
store entrances, contrasting profile metal sheeting with a large area
12
12
the sale of DIY, furniture, furnishings, beds,
1
15
Q
1
3
18
40
11
for occupier signage and block paving adjoining the entrances.
14
electricals and carpets.
17
He
2
4
nle
It is otherwise of standard retail warehouse construction with a
yda
le
Site Plan
5
7
steel portal frame structure and pitched roofs. There is a customer
6
8
vehicle entrance/exit to the eastbound carriageway of the A34 The site totals 3.98 acres, giving a low site
cover of 34.6%
Tanks
with roundabout junctions on either side of the scheme to permit
easy access to both sides of the carriageway. This segregated
Environmental
servicing with an entrance from Marshall Lake Road at the back of the
Prior to redevelopment in 2006, the site was
development. The customer and vehicle entrance is shared with the
occupied by a car garage from the 1930s to
adjoining Jaguar Land Rover showrooms. There is car parking for 171
8
the 1970s. Some remediation works were
36
60
ST
customer cars, giving a ratio of 1:263 sq ft. There is a site area of 2.99
3
RA
19
carried out prior to the subject development.
TF
28
OR
acres (1.21 ha) giving a low site cover of 34.5%.
D
A Phase One report is available for assignment,
R
26
O
a
AD
26
Tenancy Schedule which gives the site a low risk rating. 139.0m
El Sub Sta
18
16
60
7
6 18
56 a
14
Shelter
Tenant Area Lease Start Lease End Next Rent Rent (p.a) Rent
ry
Shelter
te
10
by
8
56
es
138.1m
(Sq Ft) Review (Per Sq Ft) Works
57
6
2
Wren Kitchens Ltd 9,957 10-Apr-2013 09-Apr-2023 £296,221 £29.75
68
Sofology Ltd 14,985 08-Apr-2013 07-Apr-2023 £445,804 £29.75
6 TCB
58 139.0m
9
Tapi Floors & Carpets 10,021 24-Jul-2017 23-Jul-2027 24-Jul-2022 £330,693* £33.00
10
645 a to f
647 a to f
2
Furniture Village Ltd 10,000 04-May-2007 03-May-2027 04-May-2022 £325,000 £32.50
655 a to f
6
657 a to f
44,963 £1,397,718 £31.09
6a
8
*Tenant currently paying half rent, 24/01/2018 - 23/01/2019 – to be topped up by vendor. 665 a to f
Shelter 667 a to f
12 675
677
a
12
Investment Aerial View Location Demographics Local Retail Description ERV, Investment VAT / EPC
Summary Economy Warehousing Tenure, Planning Tenant’s Comparables Proposal,
14
in Solihull Tenancy Schedule Covenants Contact
22
24 138.7m
Path
0m 20m 40m 60m
11
AD
RO
11
D
a
OR
KF
Ordnance Survey © Crown Copyright 2018. All rights reserved.
Licence number 100022432. Plotted Scale - 1:1431
8
Estimated Rental Value
9.
The most recent letting on the scheme was on Unit 2 to Tapi in July On the Sears Retail Park, the smaller units between
2017 at a headline rent reflecting £33 per sq ft. This letting was 10-15,000 sq ft are let at rents between £30-£38.50 per sq ft.
subject to just 12 months rent free. This equates to a net effective rent The most recent evidence emanates from a Boots re-gear carried out
of £30.53 per sq ft. The previous tenant in this unit, Starplan, were in April 2016 at £30 per sq ft for 15,346 sq ft.
paying a marginally lower headline rent reflecting £32.50 per sq ft.
Adjoining the Sears Retail Park is the ex-Toys ‘R’ Us unit at 44,100 sq
The Solihull Retail Park to the rear, is fully let, having been refurbished ft. We understand there is good interest in occupying this unit on
and re-geared between 2012/2015. The most recent letting was behalf of discount food retailers linked up with either Home Bargains
to Dreams of 7,072 sq ft at £33.00 per sq ft, with effect from March or B&M for the balance.
2015 subject to a 12 month rent free period. Passing rents generally
The Next lifestyle unit of 30,000 sq ft is subject to a lease
range from £30 - £37.50 per sq ft on the units of between 7-16,000
commencing 24th June 2014 at a rent equating to £26.67 per sq ft.
sq ft and there are no voids on this scheme.
Overall, we consider the subject scheme can be considered
rack-rented. Over recent years, any voids in this overall pitch have
been quickly re-let and there is good competition for the
available Toys ‘R’ Us unit.
Tenant’s Covenants
Unit Tenant Year Ending Sales Turnover Pre Tax Net Worth D&B Rating
(000’S) Profit / Loss (000’S)
(000’S)
31/12/2017 £406,685 £16,571 £18,594
1A Wren Kitchens Ltd 4A2
31/12/2016 £338,094 £11,007 £6,153
31/12/2016 £143,008 -£8,917 -£14,276
1B Sofology Ltd* N2
31/12/2015 £142,860 -£385 -£5,726
31/12/2016 £30,294 -£10,195 £8,255
2 Tapi Carpets & Floors 3A2
02/01/2016 £1,253
02/04/2017 £238,064 £1,675 £13,452
3 Furniture Village Ltd 3A1
27/03/2016 £213,912 £3,864 £13,840
*Owned by DFS PLC
Investment Aerial View Location Demographics Local Retail Description ERV, Investment VAT / EPC
Summary Economy Warehousing Tenure, Planning Tenant’s Comparables Proposal,
in Solihull Tenancy Schedule Covenants Contact
910.
Investment Comparables
Set out below are a number of investment comparables, all of which have transacted since February of this year and most of which are in the general Birmingham area. It will be seen that the price quoted for this
property reflects a significant discount to the prevailing net initial yield levels of between 5.2 – 6.0% shown from the comparables. Furthermore the overall quality of this property is considered to be at least as good
as all the other properties detailed:
Property Size Tenants Lease Details Passing Rent Price (£M) Initial Vendor Purchaser Date
Sq Ft (Psf) Yield
Birmingham 230,822 Currys PC World, Next, M&S Foodhall, DFS, WAULT 10.2 yrs £9,474,754 pa £175,000,000 5.20% KKR (Quadrant Korea Asset Investment Jul-18
(Wednesbury) - Harveys, Bensons, JD, Furniture Village, (9.7 inc brks) (£41.05 psf) Estates) Management (KAIM) / HANA
Gallagher Shopping TK Maxx, Outfit, Boots, Mamas & Papas, Financial Investment
Park (aka Junction 9) ScS, Sofology, Oak, Tapi, Nando’s, Costa,
Smashburger, Burger King, KFC, Pizza Hut.
Slough - Slough Retail 153,000 The Range, Sofology, AHF, ScS, Harveys, WAULT c. 6.0 yrs £3,526,913 pa £63,030,000 5.44% Benson Elliot Orchard Street May-18
Park Smyths Toys, DFS and Carpetright.
Birmingham - Selly Oak 210,000 Sainsbury’s, Next, M&S Foodhall, JD, N/A N/A £94,000,000 5.00% JV - LandSec / M&G May-18
Shopping Park Superdrug, Wilko, Card Factory, Costa, Sainsbury’s
Greggs.
Birmingham - 312,549 M&S, Poundland, Boots, Mountain WAULT 13 yrs+ £3,405,933 pa £53,600,000 6.00% St Modwen Columbia Threadneedle May-18
Longbridge Warehouse, Smyths Toys, Holland & Barrett, inc brks
and Card Factory
Solihull 26,795 Sports Direct WAULT 10 yrs £589,490 £10,000,000 5.50% Sports Direct IM Properties Apr-18
Sports Direct (£22.00 psf)
Birmingham (Selly Oak) 135,578 Homebase, Currys PC World, Next, TK Maxx, WAULT 7.15 yrs £3,748,331 pa £57,500,000 6.00% Hammerson NFU Mutual Feb-18
- Battery Retail Park Halfords, Pets at Home, Carpetright, Sports (£27.67 psf)
Direct, Poundland, Iceland, Maplin, Frankie &
Benny’s.
Investment Aerial View Location Demographics Local Retail Description ERV, Investment VAT / EPC
Summary Economy Warehousing Tenure, Planning Tenant’s Comparables Proposal,
in Solihull Tenancy Schedule Covenants Contact
1011.
VAT EPC Proposal
The property is elected for VAT and it is envisaged EPC certificate and recommendation reports are We are instructed to seek a price of £18,700,000
that the property will be sold by a way of Transfer available and can be provided on request. subject to contract and exclusive of VAT.
of a Going Concern (TOGC). This would give a net initial yield of 7.00%,
after allowing for purchaser’s costs of 6.74%.
Contact
Paul Wilkinson Ellie Kirkby
Tel: 020 7317 3799 Tel: 020 7317 3790
Mobile: 07770 585 313 Mobile: 07764 241 898
Email: paul.wilkinson@avisonyoung.com Email: ellie.kirkby@avisonyoung.com
MISREPRESENTATION NOTICE. Avison Young give 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 of representation or 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 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 the 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 an intending purchaser. 7. Descriptions of the
property are inevitably subjective and the descriptions contained herein are given in good faith as an opinion and not by way of statement of fact. Plans are published for convenience of identification only and although believed to be correct, their accuracy is not guaranteed and they do not
form part of any contract. October 2018.
Designed and produced by Creativeworld Tel: 01282 858200.
Investment Aerial View Location Demographics Local Retail Description ERV, Investment VAT / EPC
Summary Economy Warehousing Tenure, Planning Tenant’s Comparables Proposal,
in Solihull Tenancy Schedule Covenants Contact
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