Stratford, London E15 - 4 Cam Road Freehold Multi Let Office Investment - Allsop
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Freehold Multi Let Office Investment
4 Cam Road
Stratford, London E15
Stratford Regeneration
Stratford is one of London’s most accessible locations the area will be animated with fountains and art Westfield Stratford City opened in 2011 and
and has undergone significant redevelopment. installations. The North of the Park, will feature a houses 1.9 million sq. ft. of retail and leisure
river valley centred around waterways, parklands accommodation with 300 shops and over 50 food
The most important stimulus for regeneration was and green space. and beverage outlets. The centre represents
the Olympic Park development which helped put a complete package of retail, dining and
the shard Stratford in the spotlight. The transformation of At the centre of the regeneration is the upgrade entertainment situated over a 700 acre £1.45
the Olympic Park has already begun, capitalising of Stratford International station and installation billion development. It features major retail
on its prestige and profile. The Park will reopen of Crossrail. In August 2011 an extension of the anchors including John Lewis, Waitrose and
the city in 2013 as ‘Queen Elizabeth Olympic Park,’ with Docklands Light Railway was opened to connect Marks & Spencer as part of a 300 strong tenant
world-renowned sports facilities, attractions, the station directly to the wider London public line-up of the world’s most innovative and
event spaces and parkland. With an urban transport network and Stratford Regional station recognisable brands. Westfield extends over three
entertainment plaza in the South of the Park, slightly to the south. Stratford is served by the HS1 levels with an elaborate ‘lifestyle street’ linking
anchored by the Stadium and Aquatics Centre, rail route which provides services to Europe. Stratford International and Stratford stations.
Olympic stadium
westfield
4 cam road
4 Cam Road, Stratford, London, E15 2SY
Investment
Summary
• Well located east London office investment situated
in an area that has experienced significant inward
investment.
• Large scale regeneration projects in Stratford
include the Olympic Park, Westfield, Crossrail,
and Stratford International station.
• Outstanding road, rail and air communications.
• Modern specification office building completed
in 2010 with limited capital expenditure
required in the short term.
• Freehold
• Specification includes raised access floors,
VRF air cooling system, 2 x 10 person passenger lifts
and is DDA compliant.
• 83% of the 38,596 sq. ft. is currently let
with the vacant accommodation providing
the opportunity for reversionary income.
• The property has attracted strong covenants
in the form of the NHS and Bank of Tokyo-Mitsubishi
which account for 89% of the current income.
• Current passing rent of £568,250.50 per annum
equating to an average rent of only £17.80 psf.
• Benefit of an additional ‘fit out’ rent from
Bank of Tokyo Mitsubishi of £214,880 per annum
until April 2020.
• Total rent equates to £783,130.50 per annum
• We are instructed to seek offers in the region of
£7,500,000 (Seven million five hundred thousand
pounds) subject to contract and exclusive of VAT. A
purchase at this level reflects the following yield profile
after allowing for purchaser’s costs of 5.8%:-
- Net initial yield of 9.86%
- Reversionary yield of 10.88% assuming a
conservative ERV of £17.00 p.s.f. and a fit out cost
of £300,000 (£45 p.s.f.) on the vacant floor
- Capital value of £194 p.s.f.
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Stratford is an important and thriving commercial centre located
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in east London. It lies approximately 9.7 km (6 miles) from the
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West End and 6.4 km (4 miles) from the City of London.
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Stratford is situated within the London Borough of Newham which has a resident population of 310,500.
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Of that number, 229,000 residents are in employment, with only 5,650 of residents long term unemployed.
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Car Park
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A1
Due to its accessibility, Stratford is establishing itself as a major employment centre within London.
Major office occupiers include Westfield, Coral Bookmakers, London Legacy Development Corporation CamdenRetail
Parliament 03
Hill A5
and the University of East London. BT has recently taken 75,349 sq. ft. of accommodation at iCity.
2
Hackney
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A1
to
Highbury Square
ria
Marsh
Prime rents of £25 per sq. ft. have been achieved at the new Stratford City development. Amazon are
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ills
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dio
currently canvassing London for a new headquarters campus of 750,000 sq. ft. and Stratford
s
is rumoured to be on the destination shortlist.
60
50 St Pancras
Retail
There has been an encouraging volume of inward investment into Stratford recently. Alongside the
Kings OLYMPIC
major regeneration projects taking place, University College London are building a 23 acre £1 billion SITE Stratford
108-133
Cross
21-107
campus. M&G Investments have just completed the purchase of 401 new build flats from Genesis London
Zoo
Housing Association for £125m. A private overseas investor purchased two Intercontinental Hotels at Victoria
Park
Westfield Stratford in December 2012 for £58m, reflecting a net initial yield of 6.9%. 38
13
48
Regent’s
4-
16
Parkpurposes only.
1
For identification Millenium
Park A11
1-20
Situation 36
26 Site area Sea
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ad
Barbican
Occupying a large prominent site adjacent to the busy A11, the property is situated within an area of nn
el City A13
0.20 acres (0.08 hectars) a
Ch West End
modern residential and office developments. The property is accessed from the east side of Cam Road of London A13
Limehouse
approximately 100 metres from its junction with High Street (A11). Cam Road is situated approximately
400 metres to the south of central Stratford and Stratford International station. Significant nearby office Tower
developments include Stratford Place, The Square, First Avenue and the University of East London 0m
London
Bridge Canary
Retail
Millenium Waterloo Bridge
10m 20m 30m
Wheel Wharf
Stratford Campus. Notable local occupiers include London Borough of Newham, Barclays, NatWest, Industry
The Metropolitan Police Service, Barratt and Unison. © Crown©Copyright,
UKMap Copyright TheES 100004106.
GeoInformation Group 2013 For identification purposes only.
Licence No. LANDMLON100003121118. Plotted Scale - 1:1035
Communications
Road Air
• Stratford benefits from excellent road communications into and • Stratford has 3 International and 2 Regional airports within an hour’s drive, the closest being London City Airport located approximately 8 km (5 miles)
out of central London. south east of the subject property.
• Stratford High Street (A11) provides access into central London • London City Airport already serves 3.03 million passengers per year with plans in place to accommodate 8 million passengers per year by 2030.
and the A112 to the north which links with the A12 and the M25 London City Airport will continue to play an increasingly key role in London’s economy.
approximately 12 miles to the north east at Junction 27. The M11
• London City Airport serves 40 destinations across the UK, Europe and the USA, with connections to the rest of the world through the major European hubs.
is less than 5 miles to the north of Stratford Town Centre.
Rail Crossrail
• Stratford Station is 0.5km north of the subject property where
London Overground
DLR, London Underground (Central and Jubilee lines) and
Surface line DLR
London Overground Services are available.
Tunnel London Underground
• Stratford International station is approximately 1km North West Portal (tunnel entrance and exit) National Rail
of the subject property and provides DLR services as well as Forest Harold
Eurostar and HS1 services.
Stratford Gate Ilford Goodmayes Romford Wood Shenfield
Hayes & Ealing Bond Maryland Manor Seven Chadwell Gidea Brentwood
• Stratford High Street Station (DLR) is within a minute’s walk to the Taplow Slough Iver Harlington Hanwell Broadway Street Farringdon Whitechapel Park Kings Heath Park
north of the subject property.
Maidenhead Burnham Langley West Southall West Acton Paddington Tottenham Liverpool Custom
Abbey
Court Road Street House
• Crossrail is the biggest engineering project in Europe. Once Drayton Ealing Main Line Wood
completed in 2017 Crossrail will connect 37 stations across a Heathrow Canary Woolwich
horizontal axis through London. Below is a list of expected journey Airport Wharf
times from Stratford upon Crossrail’s completion:
heathrow 42 mins
description
The property was completed in 2010 and comprises 3,585.6 sq. m. (38,596 sq. ft.)
of modern office accommodation over part ground and six upper floors. The
property is of steel frame and concrete construction with striking glazed
curtain walling and timber clad elevations. This gives the property a unique
modern profile. There are 9 car parking spaces within the rear of the ground
floor housed within a secure lock up garage. The property also benefits from
a large modern open plan manned reception area. There are two roof terraces
accessed from the 6th floor offices.
The property benefits from a modern specification. Typical floors comprise the
following specification:
• 1.5m planning grid • Carpet tile flooring
• 2750 mm floor to ceiling height
• DDA compliant
• Acoustic metal tile suspended
ceilings typical floorplan
• VRF air cooling system • Integral LG3 compliant lighting
2nd floor
• Raised access floors • Male and female and disabled Core Core
access WC’s on each floor.
• 2 x 10 person passenger lifts
The 4th floor is currently only fitted out to shell and core.
Tenure
Freehold
Tenancies
Floor Tenant Name Area Area Current Lease Start Lease Expiry Comments
(Sq M) (Sq Ft) Rent (£ p.a) (Review) (Break)
(£ psf)
5&6 NHS Shared Business Services Ltd 1,038.3 11,177 £208,872.00 23/12/2010 31/05/2015 Outside the Act. Three car parking spaces.
(£18.69)
4 Vacant 620.0 6,674 - - -
Part 3rd Careers Development Group 301.7 3,247 £50,328.50 26/09/2011 25/09/2021 Rent commences 26/09/2013. Vendor to top up. Service charged capped at £16,235 pa.
(£15.50) (26/09/2016) (26/09/2016) Reviewed annually to RPI. 3 months notice on tenant’s break options. 6 months rent free
(26/09/2018) from 26/09/2016 if break option not exercised.
2nd & Part 3rd Bank of Tokyo-Mitsubishi UFJ Ltd 905.3 9,745 £164,866.00 19/04/2010 18/04/2020
(£16.92) (19/04/2015)
1 Bank of Tokyo-Mitsubishi UFJ Ltd 576.2 6,202 £105,434.00 19/04/2010 18/04/2020
(£17.00) (19/04/2015)
Ground Seetec Business Technology Centre Ltd 144.1 1,551 £38,750.00 01/06/2010 31/05/2013 Outside the Act. Schedule of condition attached to lease. Service Charge capped at £9,300 per annum.
(£24.98)
Fit out rent Bank of Tokyo-Mitsubishi UFJ Ltd - - £214,880.00 19/04/2010 18/04/2020
Total 3,585.6 38,596 £783,130.50
Tenants' Covenant
Bank of Tokyo-Mitsubishi UFJ Ltd NHS Shared Business Services Ltd Careers Development Group Seetec Business Technology Centre Ltd
Mitsubishi UFJ Financial Group (MUFG) is one of the NHS SBS is a unique joint venture between the The Careers Development Group (CDG) is a leading Seetec is one of the UK’s largest and most experienced
world’s largest and most diversified financial groups Department of Health and Steria offering a wide range of back to work charity with 30 years’ experience of helping providers of Government funded employment and skills
with total assets of JPY218.9 trillion as of March 2012. innovative back office services to more than 40% of the people find and stay in work. Their team was supported training programmes, helping thousands of individuals find
MUFG’s services include commercial banking, trust NHS. They deliver operational efficiency, real cash savings by more than 30,000 people in 2011 from centres across employment or gain qualifications every year. Seetec employs
banking, securities, credit cards, consumer finance, asset and added value services. Their range of business support London and the South East, delivering a wide range hundreds of dedicated and experienced staff across a
management, leasing and many more fields of financial services are projected to save the NHS more than £3 billion of back-to-work initiatives. CDG started delivering the national network of training centres. Through a UK wide
services. The group has the largest overseas network of over the next five years. Every year NHS SBS makes over coalition government’s flagship Work Programme as range of employment programmes, delivered on behalf
any Japanese bank, comprising offices and subsidiaries, in £43 billion-worth of payments, process 2.5 million payroll a prime contractor in east London in June 2011 and of the Department for Work and Pensions and Jobcentre
more than 40 countries and 500 offices around the world. transactions and recover £13 billion of NHS debt. merged with the ‘Shaw Trust’ in September 2012. Plus, they work closely with thousands of jobseekers,
employers and partner providers every year to support
unemployed individuals back to work.
31st December 31st December 31st December 31st March 31st March 31st March 31st March 31st March 31st March
2009 2010 2011 2010 2011 2012 2009 2010 2011
Turnover £47,377,000 £53,265,000 £62,447,000 Turnover - - - Turnover £21,203,872 £37,594,182 £53,457,888
Profit £564,000 £1,926,000 £3,278,000 Profit £1,599,300 £733,200 -£326,600 Profit £2,112,133 £5,160,257 £14,641,639
Total Net Worth -£8,243,000 -£5,124,000 -£136,000 Total Net Worth £4,805,500 £5,578,700 £5,252,100 Total Net Worth £5,330,215 £7,081,033 £15,985,222
Asset Management Stratford Office Market
4 Cam Road offers the following asset management
The local occupational market has been dominated accommodation between 10,000-25,000 sq. ft. and
opportunities to include:
by smaller deals in 2012. 33 of 42 transactions in current availability in this bracket comprises 21%
• Regear existing leases with tenants to increase income length. the City and Fringe markets in Q3 were of less than of overall availability. Rents are forecast to grow in
• Remove breaks. 10,000 sq. ft. This proportion of smaller transactions the City Fringe and East London as occupational
has not been seen since 2000. There is currently requirements grow. It is widely predicted that rapid
• Let vacant 4th floor accommodation. 1,364,000 sq. ft. of office accommodation within TMT expansion within London should positively
Stratford and a vacancy rate of 7.1%, compared to impact areas like Stratford as occupiers seek
the City and West End of 7.9% and 4.1% respectively. affordable rents while remaining close to central
rental income During 2012, there was 434,000 sq. ft. of take areas.
up within the Docklands/East London market in
comparison to 496,000 sq. ft. in 2011. The biggest infrastructure change within the London
Careers office market will be facilitated by Crossrail. This
development Positive activity in the area means demand for
group - 6%
SEETEC - 5% will likely produce a big gravitational pull along the
office accommodation has been focussed on Heathrow-Central London-Stratford axis, significantly
NHS - 27% developments in Stratford as opposed to other improving these locations and further establishing
competing locations. them as commercial centres. This will boost long
Prime rents within Stratford stand at £25.00 per term rental growth as hubs like Stratford become
sq. ft. with prime capital values remaining stable at financially and logistically viable for a new generation
£220 per sq. ft. since June 2009. The recent letting of of occupiers. Any significant office development
42,000 sq ft to Network Rail at One Stratford Place for activity will likely occur in the most viable outlying
10 years was reportedly agreed at £35 per sq. ft, locations along this cross-rail ribbon. Crossrail
One Stratford Place is now 85% let. 23% of active will open up and enable new opportunity in areas
BANK OF TOKYO
MITSUBISHI -
Service Charge demand is focussed on accommodation between
0-5,000 sq. ft. and 14% of availability is of this
like Stratford. It will facilitate rapid and convenient
movement across London linking with two major
62% The service charge is currently running at £3.23 per sq. ft. size. Similarly 35% of demand is focussed on airports as well as HS1 and the proposed HS2.
Proposal
We are instructed to seek offers in the region of
£7,500,000 (Seven million five hundred thousand pounds)
subject to contract and exclusive of VAT. A purchase
at this level reflects the following yield profile after
allowing for purchaser’s costs of 5.8%:-
- Net initial yield of 9.86%
- Reversionary yield of 10.88% assuming a
conservative ERV of £17.00 p.s.f. and a fit out cost
of £300,000 (£45 p.s.f.) on the vacant floor
- Capital value of £194 p.s.f.
Energy rating VAT
The property has been rated C on the EPC scale (55). The property is elected for
EPC certificate available upon request. VAT purposes and therefore
VAT will be payable by the
purchaser, unless the sale is
Capital Allowances structured as TOGC.
Further information can be provided upon request.
For further information or to make arrangements for viewing please contact:
Scott Tyler Guy Scott Plummer Joe Raitt
020 7543 6719 020 7543 6726 020 7543 6890
scott.tyler@allsop.co.uk guy.scott-plummer@allsop.co.uk joe.raitt@allsop.co.uk www.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. 01.13
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