PROMINENT RETAI L INVESTMENT

ACTON 141/143 HIGH STREET LONDON, W3 6LX

PRIME RETAI L/OFFICE INVESTMENT WITH RES IDENTIAL DEVELOPMENT OPPORTUNIT Y (STPP)

LONDON, 244 CHISWICK HIGH ROAD, W4 1PDMINT VELVET & CHISWICK DENTAL CENTRE

INVESTMENT CONSIDERATIONS

• Chiswick is one of London’s most popular and prosperous suburbs

• Prominent location on the prime retail pitch close to national multiples including M&S Foodhall, Carphone Warehouse, Tesco Express, Gap and Oliver Bonas

• The ground floor is secured to a major national multiple retailer acquired by River Island’s parent company in March 2019 for £100m

• Asset management angles to convert (and possibly extend) the upper floors into valuable residential use (STPP)

• Offers in excess of £2,525,000

• Attractive net initial yield of approximately 5.0% assuming normal purchaser’s costs

CHISWICK

Chiswick is a highly affluent and vibrant London village.

It is located in the London Borough of Hounslow, just 6 miles (10 km) to the west of Central London. Such a convenient position ensures that it provides swift and easy access into central London which attracts many young professionals and families to the area. These inhabitants are also drawn to Chiswick for its leafy surroundings, upmarket housing, excellent schools and proximity to the River Thames and the leisure experiences which that provides.

Chiswick is home to numerous bars and restaurants and provides an extensive retail offer. It is also an important office location providing headquarters buildings for many international brands such as Starbucks, Avon and Danone at major office complexes such as Chiswick Park.

COMMUNICATIONS

Chiswick is one of the most accessible locations in west London due to its close proximity to major road, rail and air links.

The area has excellent road communications being adjacent to the A4, the principal route heading out of London which becomes the M4. This provides direct access to the M25 at junction 15, with Heathrow Airport just 10 miles (16 km) to the west. Driving east on the A4 provides access into central London.

Chiswick also benefits from an overground rail service (Zone 3) to London Waterloo with a journey time of approximately 30 minutes. There are 5 services per hour at peak times.

The London Underground also serves Chiswick with the District Line stopping at both Chiswick Park (Zone 3) and Turnham Green (Zones 2/3) stations. This provides access to the wider underground network and directly to London Victoria in approximately 20 minutes. Piccadilly line trains stop at Turnham Green station during peak times providing direct links to Kings Cross and Heathrow Airport.

DEMOGRAPHICS

Chiswick enjoys an affluent and loyal catchment population. The population was approximately 34,500 at the census in 2011 but draws form a far wider catchment population of approximately 254,000 from within The London Borough of Hounslow.

The Borough of Hounslow is one of the most rapidly growing boroughs in London. Between the 2001 and the 2011 census’ the population grew from 212,000 to 254,000 a 20% increase. The resident population in the Borough was projected to grow a further 36,000 (15%) to 291,000 by 2021. Such a dramatic growth would bring with it significantly more retail spend into the borough. (Source: ONS).

Currently the area attracts a higher than average number of young professionals, families in the 25 – 44 age range as well as the over 65’s, all of whom have a high propensity to spend disposable income. Such socio-economic groups are expected to lead this population growth ensuring that the borough benefits from this increasing spending power.

RETAIL & LEISURE IN CHISWICK

The retail and leisure offer in Chiswick is large and diverse with small, independent traders sitting alongside national multiples.

The primary retail and leisure offer is focused along the High Road where larger occupiers include Sainsburys, Boots, Robert Dyas and Waitrose.

There are also numerous cafes, restaurants and bars along the length of the High Road including Byron, Zizzi, Pizza Express and Bills.

LOCATION

The property is located on the northern side of the High Road, in the heart of the prime retailing area and in arguably the busiest part of Chiswick High Road, in between its junctions with Windmill Road and Fishers Lane.

The property adjoins Carphone Warehouse with a small return frontage onto Bond Street, a pedestrianised thoroughfare which links the High Road to Chiswick Common.

There are numerous national multiple operators in close proximity including M&S Foodhall, Tesco Express, Gap, Mountain Warehouse, Carphone Warehouse and Oliver Bonas.

DESCRIPTION

The property is of brick construction under a flat roof.

It comprises a well configured retail shop on the ground floor with an extensive frontage to the High Road, and first floor offices which are accessed via a self contained staircase from the front of the property which are used as a dental practice.

Within the ownership are three car parking spaces, two demised to the offices and one to the shop. They are at the rear of the property and accessed from Chiswick Common Road.

COVENANT INFORMATION

Sabre Retail Fashion Limited trade as Mint Velvet and will be celebrating their 10th anniversary in June 2019. They are a British based womenswear brand with 46 boutiques located in affluent locations across the UK as well as concessions in a number of department stores.

Sabre Retail Fashion Limited (Registered No. 07920155) has published the last three years trading figures and is rated as “72/100 – Very Low Risk” by Creditsafe:

28/04/2018 29/04/2017 30/04/2016

Turnover £100,969,000 £87,444,000 £81,422,000

Pre Tax Profit £13,547,000 £12,520,000 £14,181,000

Shareholder Funds £28,590,000 £17,985,000 £8,319,000

Such an impressive performance led the Lewis Trust Group, the parent company of River Island, to acquire the business for £100m in March 2019.

Chiswick Dental Centre Limited (Registered No. 08206547) is a dental practice who operate from this one property. As a small private business their accounts are not openly available.

TENANCY

The ground floor of the property is let to Sabre Retail Fashion Limited, trading as Mint Velvet, on a 10 year effectively full repairing and insuring lease from 4th September 2013 at a passing rent of £100,000 per annum.

Mint Velvet had the benefit of a break clause in September 2018 which they chose not to instigate.

The first floor is let to Chiswick Dental Centre Limited (guaranteed by Herminder Singh Kooner), on a 15 year, effectively full repairing and insuring lease from 21 April 2012, at a current passing rent of £33,000 per annum.

The rent is reviewed 5 yearly, upward only and to the open market rental value.

The tenant has a break clause operable on the 21st April 2022 on a minimum of 6 months notice.

A Licence is also in place with Carphone Warehouse to allow them to pass over land at the rear for escape purposes and to hang their air conditioning units on the rear wall. This licence expires on 20th April 2026 and produces £1,500 per annum. The rent is to be reviewed on 20th April 2021 in line with the RPI.

In total the property generates £134,500 per annum.

ACCOMMODATION

The property has been measured to provide the following approximate dimensions and floor areas:

Internal Width (min) 18’ 9” 5.72 m

Internal Width (max) 23’ 0” 7.0 m

Shop Depth 54’ 0“ 16.46 m

Ground Floor Sales 1,183 sq ft 109.9 sq m

ITZA 699

Ground Floor Storage 54 sq ft 5.02 sq m

First Floor Offices 1,200 sq ft 111.48 sq m

TENURE

Freehold

RENTAL VALUE

Unlike many towns and cities across the UK, rental growth has occurred in Chiswick in recent years. This was suitably demonstrated by the September 2018 rent review settlement of the subject property where the rent increased from £91,500 per annum (£137 Zone A) to £100,000 per annum (£150 Zone A).

The prime tone is now established at £150 Zone A, as highlighted in the schedule of comparable evidence below:

Address Tenant Event Date £ZA

244 High Road Mint Velvet Review Sept-18 £150.00

290 High Road Three Renewal July-18 £150.00

256/258 High Road

Oliver Bonas Letting Aug-17 £151.00

282 High Road

Gails Bakery Review Dec-16 £150.00

274 High Road Shavata Letting Apr-16 £151.00

242 High Road

Carphone Warehouse Letting Apr-16 £155.00

252 High Road Pizza Express Review Mar-16 £154.00

The passing rent of the upper parts is £33,000 per annum which was set at the last review in April 2017. This shows a rate of £27.50 psf, and was an increase from £28,000 per annum, (£23.35 psf) in 2012.

Office rents on Chiswick Park are in excess of £50 psf.

ASSET MANAGEMENT OPPORTUNITY

Some surrounding buildings extend to three storeys and the subject only two. There is therefore the potential to exploit this “air space”. Development could also take place on the rear yard allowing the retail unit to be extended whilst creating valuable new space above. Planning permission is not in place and such works would require the appropriate permissions.

Alternatively, a more modest development could involve the conversion of the existing first floor offices into two flats, each with their own parking space.

Demand for residential would be high. Property prices remain amongst the highest in the UK with the current average value being £858,000 an increase of 26% between December 2015 - 2018. (Source: Land Registry and Foxtons).

The average house price in the borough is 40% above the London average.

INVESTMENT COMPARABLES

Investment properties have always proved popular in Chiswick with the following table showing the strong pricing achieved for High Road properties in recent times:

Q=Quoting

Address Tenant Expiry Price NIY Rent (ZA/£psf) Date

252 Chiswick High Rd Pizza Express 2031 £2.0m (Q) 4.5% (Q) £154 Under Offer May 2019

255 Chiswick High Rd Pot Pourri Flowers + Resi Uppers 2022 £1.6m 4.5% £90 Sold

July 2018

264 Chiswick High Rd Mountain Warehouse + Resi Uppers 2025 £5.1m 4.05% £150 Sold

Nov 2017

PLANNING

The property is not Listed but is located within the Chiswick High Road Conservation Area.

SERVICE CHARGE

No service charge regime is in operation however the leases allow for any repairs to common areas including the structure and rear yard to be reclaimed from both tenants, split on a 50/50 basis.

VAT

The property has not been elected for VAT.

EPC

Ground Floor – G - 214

First Floor – E - 117

The EPC assessor has stated that if the lighting were changed in the ground floor shop to energy efficient LED lighting that the grading could be improved to E.

PROPOSAL

We are instructed to seek offers in excess of £2,525,000 (Two million five hundred and twenty five thousand pounds) subject to contract and exclusive of VAT for the freehold interest in the property.

A purchase at this level would reflect an attractive net initial yield of approximately 5.0% assuming normal purchaser’s costs.

CONTACTS

To register an interest, request further information or to carry out an internal inspection please contact:

Richard Ward Tel: 020 7079 1202 Mobile: 07919 118529 Email: richard@wardproperty.uk.com

Or our joint agent

Colin Baxter Blanchflower Lloyd Baxter Tel: 020 7491 7880 Mobile: 07775 871897 Email: colin@blb.uk.com

DISCLAIMER NOTICE: Whilst every care is taken in the preparation of these particulars, Ward Property Consultants Limited, any joint agents involved and the vendor take no responsibility for any error, mis-statement or omission in these details. Measurements are approximate and for guidance only. These particulars do not constitute an offer or contract and members of the Agent’s firm have no authority to make any representation or warranty in relation to the property. May 2019

PRIME RETAIL/OFFICE INVESTMENT WITH RESIDENTIAL DEVELOPMENT OPPORTUNITY (STPP)

LONDON 244 CHISWICK HIGH ROAD, W4 1PD

CHISWICK COMMON

CHISWICK PARK 7 mins

TURNHAM GREEN 5 mins

CHISWICK HIGH ROADBO

ND STREET

CHISWICK COMMON ROAD

www.wardproperty.uk.com