CASS BUSINESS SCHOOL

LONDON COLLEGE OF FASHION

OLD STREET UNDERGROUND STATION AND SURROUNDING ‘TECH CITY’

CANTO COURT

CANTO COURT122 OLD STREET | LONDON | EC1V 9BD

CANTO COURT

BARBICAN

SMITHFIELD MARKET

QUEEN MARY UNIVERSITY

Inner Courtyard

LOCATIONLondon is the capital city of the United Kingdom, with excellent inter-city and international travel links. The M25,

which encircles the city, connects directly to routes to the North (M1, M11, M40), West (M4), South (M3, M23)

and East (M2, M20) of the country. The city is supported by eight main railway stations including King’s Cross St

Pancras, which connects directly to mainland Europe via the Eurostar network.

The city is supported by several major international airports including Heathrow (17 miles), Gatwick (30 miles)

and Stansted (37 miles). All are easily accessible via public transport, namely coach services and express train

routes. Heathrow is also linked directly to the London underground network via the Piccadilly Line (journey time

from Old Street approximately 70 minutes).

London is the largest metropolitan area in the European Union and in demographic terms its population rate

increased from 7,172,091 to 8,173,900 between 2001 and 2011; an increase of 14%. During this period the

population of Islington increased from 175,792 to 206,125; an increase of 17.3%.

London is expected to remain at the forefront of the UK recovery given its concentration of service sectors

companies. Growth output in London (nominal GVA) 2007 – 2011 was 12.40%, far out-stripping other UK

regions. In labour market terms, 374,000 jobs created in the UK between 2013 and 2018 are forecast to be

within London, which equates to approximately 1 in every 4 jobs (ONS).

INVESTMENT CONSIDERATIONS ￭ Freehold student accommodation property constructed in 2008. 164 self contained en-suite studio

apartments arranged as basic, classic and premium room types.

￭ The property benefits from a nomination agreement with City University London expiring June 2015.

The University have taken 91 bedrooms for 2013/14, 55% of the scheme.

￭ Located within easy walking distance of four university campuses and a range of transport links.

￭ Planning permission for student accommodation in London remains challenging to secure which insulates

values, drives rental growth and creates barriers to entry to the sector.

￭ Rare opportunity for representation in London, which, with a total of 41 universities, forms the largest

concentration of higher education in Europe.

￭ Within London, only 62,351 (21%) of full time students have access to purpose built student

accommodation. There are 303,105 full time students in London (HESA 11/12).

￭ London is home to four of the world’s leading 75 institutions: University College London (4th), Imperial

College London (5th), King’s College London (19th) and London School of Economics and Political

Science (68th). (2013/14 QS World University Ranking).

￭ Forecast gross rent of £2,528,332 for the 2013/2014 academic year and a net rent of £2,204,332.

￭ We are instructed to seek offers in excess of £33,900,000 for the freehold interest in the property,

which reflects a net initial yield of 6.15% on the term time student income, assuming purchaser’s costs

of 5.80%.

Inner Courtyard

Old Street Elevation

LOCAL UNIVERSITIES

Distance/Method and journey time Cass Business School Queen Mary University City University London London College of Fashion

Distance (miles) 0.3 miles 0.4 miles 0.5 miles 0.8 miles

Walking 5 minutes 8 minutes 11 minutes 13 minutes

Cycling 2 minutes 3 minutes 5 minutes 5 minutes

Source: Google

INTERCITY TRANSPORT LINKS INTERNATIONAL TRANSPORT LINKS LANDMARK DESTINATIONS

Distance/Method and

journey timeLiverpool Street Euston Waterloo Kings Cross St Pancras Heathrow Airport Oxford Circus Embankment

Underground from Old Street 9 minutes 7 minutes 14 minutes 5 minutes 70 minutes 14 minutes 21 minutes

Underground from Barbican 4 minutes 13 minutes 21 minutes 5 minutes 75 minutes 16 minutes 20 minutes

Source: Transport For London (TFL)

SITUATIONCanto Court is situated in the London Borough of Islington, directly north of the City of London in a very popular student area. The property is located on Old Street (A5201), in close proximity to Shoreditch and Hoxton and a number

of transport links, namely Old Street Underground Station and the Barbican Underground Station.

The property is well situated for a number of universities; it is within easy walking distance of Queen Mary University, City University London, Cass Business School and the London School of Fashion.

The property is located within 5 minutes walk (0.2 miles) of Old Street Underground Station (Northern Line) to the east, and within a 10 minute walk (0.5 miles) to the Barbican Underground Station (Circle, Metropolitan and

Hammersmith & City Lines) to the south west. Liverpool Street Station is also located within 20 minutes walk (1.0 miles) to the south east.

The property is serviced by several bus routes; the 55 running directly to Oxford Circus, the 243 directly to London Waterloo and two night buses (N35 and N55) to Tottenham Court Road and Oxford Circus. The nearest stop is located

on Old Street, directly opposite the entrance to Canto Court. Source: TFL

TRAVEL FROM CANTO COURT

18.1m

19.6m

TCBs

LB

TCB

Place

Withers

ST LUKES'S C

LOSE

BARTHOLOMEW SQUARE

Tilney Court

BAIRD STREET

MITCHELL STREET

BANNER STREET

Play Area

140

44 to 4714 to 17

29

132 to 136

Centre

Court

171

1 to 5

30

130

76

29

24

138

Centre

Sta

163

Club

61

El Sub Sta

15

23

42

16

to

66

11

9

1

7

Sub

118

110

45

26

173

18

Vickery

36

35

Bartholomew

PH

St Luke's

55 to 57

19

1 to

5 (a

bove

)

1

59

6

Court

30

46

61

112 to 116

15

El

39

6

ColtashCourt

Royley House12

19

21

148 to 156

108

44 to 52

Court

23 to 30

1 to 12

142 to 146

22

130

144

134

96

48 to 52

28 to 42

Church

16

146

34

33

7

1

13

36

30

Steadman

18 to 22

El Sub Sta

142

70

53 to 60

169 to 173

16 to 26

21

Royal Mail House

BuildingsFriends' Memorial

65

24

122

Canto Court

5

104

Quaker

12

Court

George Gillett

11

120

Court

23

177

to 1

87

148

0m 10m 20m 30m

Canto Court, 122 Old Street, EC1V 9BD

Ordnance Survey © Crown Copyright 2013. All rights reserved. Licence number 100022432. Plotted Scale - 1:1250

Site Plan

Not to scale - For indicative purposes only

LOCAL REGENERATION

The London Borough of Islington is set to benefit from several regeneration schemes, the most notable being the regeneration of the area around Old Street Roundabout since referred to as ‘Tech City’.

￭ Tech City, the area encompassing Shoreditch, Hoxton and Old Street, has in recent years become the major hub for the rapidly expanding TMT industry.

￭ The government announced in 2012 that £50m funding would be injected into a project to regenerate Old Street Roundabout, seeing it transformed into Europe’s largest indoor civic space, dedicated to start-ups and

entrepreneurs. These announcements were accompanied by a host of major corporate commitments to the area, notably; Microsoft, IDEALondon, KPMG and IBM.

￭ According to research conducted in 2013 by UHY Hacker Young, Tech City has become the most prolific area of new business regeneration in the UK, with 15,720 new businesses set up in the last year alone.

Other current and historic regeneration schemes within close proximity to the site include;

￭ The King’s Cross Place Plan - Following the redevelopment of King’s Cross Central, currently the largest development project in Western Europe, Islington and Camden’s councils have worked in partnership to develop

a Place Plan for the area aimed at delivering new services, facilities and public spaces to the community.

￭ The City Road Basin Master Plan - Adopted in 2004, the master plan sets out a framework for the redevelopment of the City Road Basin, former industrial land. Planning has been secured for several new developments

and the provision of new civic space has been met.

￭ The EC1 Public Space Strategy - The council, in partnership with EC1 New Deal for Communities (NDC), has also been working since 2004 to implement the EC1 Public Space Strategy; a scheme of works to improve

public spaces in the Borough.

Studio Flat Studio Flat

LONDON STUDENT MARKETWith a total of 41 universities, London forms the largest concentration of higher education across the whole

of Europe. The city is home to four of the world’s leading institutions according to the 2012/2013 QS World

University Ranking; University College London (4th), Imperial College London (5th), King’s College London

(19th) and the London School of Economics and Political Science (68th).

The capital has experienced significant growth in student numbers over the past 10 years recording a full time

student population growth rate of 34% (HESA – based on available data) during this period. Over the same

period, the international student population has increased by 61%.

Just 21% of full time students currently have access to purpose built student accommodation.

UNIVERSITY PROFILE 41 UNIVERSITIES STUDENT NUMBERS %

Student Numbers (HE)

Total Full-time

UG FT PG FT

Total International EU

Non-EU

612,715 303,105

225,980 77,125

106,285 36,435 69,850

75% of FT 25% of FT

35% of FT

34% of International 66% of International

Purpose Built Student Accommodation

(PBSA)

University Direct Let (Private)

Total PBSA

36,126 26,225

62,351

58% 42%

Supply / Demand Dynamics Supply vs Demand 62,351 / 303,105 21%

Source: HESA 2011/12

STUDENT NUMBERS (HE) FOR SELECTED LONDON INSTITUTIONS (2011/2012)

UNIVERSITY BOROUGH TOTAL FULL TIMETOTAL

INTERNATIONALTIMES RANKING

2013

City University(CASS Business School*) Islington 19,340 14,360 7,515 46

Queen Mary University, London Tower Hamlets 14,860 13,915 4,220 38

School of Oriental and African Studies Islington 5,400 4,820 2,515 31

University of the Arts, London

(London College of Fashion**)

Camden 17,300 15,715 7,110 60

London Metropolitan University Islington 23,280 17,315 5,435 116

London School of Economics Westminster 9,805 9,180 6,540 3

London South Bank University Southwark 23,350 13,190 2,055 111

University College London Camden 25,525 21,550 10,080 7

King’s College London Southwark 26,460 19,215 6,660 22

University of Westminster Westminster 21,500 15,460 5,420 95

Imperial College London Kensington and Chelsea 16,000 14,495 6,630 4

*Part of City University ** Part of University of the Arts, London Source: HESA 2011/12

LONDON BOROUGH OF ISLINGTON SUPPLY / DEMAND PROFILE

The main universities within Islington are London Metropolitan University (North Campus only), City

University, Queen Mary University, University of the Arts (London College of Fashion), Cass Business School

and the School of Oriental and African Studies.

We have spoken to the primary universities within the Borough to ascertain the number of students studying

in close proximity to the Property and within Islington as a whole. The students within these universities are

likely to provide the primary demand for student accommodation within the Borough. We have identified

circa 42,290 full time students currently studying within the Borough (Source: HESA 11/12 and University

admission office).

There are 7,690 purpose built bed spaces in Islington. 5,246 (68%) of those beds are provided by the private

sector and 2,444 (32%) are provided by universities. The existing stock represents a provision level of 18%

within the Borough.

6%

12%

78%

4% ￭ University Beds

￭ Private Beds

￭ Planning Pipeline

￭ HMO’s / With Parents

STUDENT SUPPLY/DEMAND IN ISLINGTON

Source: HESA 2011/12, University Admission Offices,

Local Planning Authority Portal / Savills

CITY UNIVERSITY LONDON

City University London is a global university whose strengths lie in business, law, health sciences, engineering,

mathematical sciences, journalism and the arts. The University launched its Strategic Plan for 2012-2016 in March

2012, which will see £200 million invested across recruitment, information services, services, infrastructure, facilities

and property. Internationalisation comprises one of the strategy’s key themes, with efforts to recruit and support

the most able students worldwide a central aim. It is hoped that this strategy will enable the University to gain

entry into the top 200 universities in the world, and top 35 universities in the UK.

QUEEN MARY, LONDON

Queen Mary is one of the UK’s leading research focused universities, with specialism’s across the humanities, social

sciences, law, medicine, dentistry, science and engineering. It belongs to the prestigious Russell Group; a group

of 24 UK Institutions committed to maintaining the very best research, an outstanding teaching and learning

experience and unrivalled links with the business and public sector.

UNIVERSITY OF THE ARTS LONDON (LONDON SCHOOL OF FASHION)

The London School of Fashion is a global provider of fashion education, research and consultancy. Teaching and

research within fashion design, fashion textiles and technology form the core of their expertise.

Common Room

TV Room

LOCAL PRIVATE RENT COMPARABLES 2013/2014

OPERATOR SCHEME AGE ACCOMMODATIONTERM LENGTH

(WEEKS)RENT

PER WEEK

Nido Nido Kings Cross 2007

Studio Bronze51 £269

43 £291

Studio Silver51 £289

43 £313

Studio Gold51 £309

43 £335

Studio Platinum51 £329

43 £357

Studio Diamond51 £359

43 £390

UrbanestUrbanest King’s Cross 2013

Studio Room 51 £349 - £379

Luxury Studio 51 £399

Urbanest Hoxton 2008 Large Studio 51 £299 - £369

iQiQ Shoreditch 2012 Studio Flat 44 £250 - £350

iQ Hoxton 2011 Studio Flat 44 £250 -£350

Inner Courtyard

Studio Room

Kitchen

PLANNING IN THE LONDON BOROUGH OF ISLINGTONPlanning permission was granted for the scheme under Application Number P061450 on the 9 October

2006. We consider that the planning condition relating to student use to be ‘wide’: “The rooms shall not be

occupied other than by students or other single persons who are associated with the provision of further

or higher education at a recognised institution in the London area”.

The London Borough of Islington (LBI) takes a cautious view in respect to proposed student accommodation

developments and this is reflected in their proposed CIL of £450 per sq m across all parts of the Borough

(due for adoption late 2013 / early 2014).

LBI seek to locate student residential around existing universities, in particular London Metropolitan

University and City University through their site specific allocations. Irrespective of the London wide need

for student accommodation, LBI feel that they have exceeded their quota on student accommodation

in the Borough. As a result, unless the site is specifically allocated for student residential by LBI, it is

considered challenging to secure new permissions for student and in our view, such barriers to entry will

insulate the value of existing stock and drive rental growth.

Student housing development is also increasingly being priced out due to greater competition from

residential developers.

Courtyard

INCOMEThere is a 2 year nomination agreement with City University expiring 28th June 2015. This agreement allows

the University to nominate either 65, 80 or 100 bedrooms at rents of £299 per week for 40 week terms.

The University have nominated 91 (eleven by way of side letter) bedrooms for 2013/14 which amounts to a

gross rent of £1,088,360. Under this agreement, rents will increase by RPI for the 2014/2015 academic year,

subject to a rental cap of £307.97 per room per week.

The remainder of the rooms are direct let to students on Assured Shorthold Tenancies (AST’s) on an

all-inclusive rental basis for predominantly 51 week terms. The weekly rent is inclusive of all Wi-Fi charges,

contents insurance (up to £300 per student), TV licences and utility bills. The gross income from direct letting

is £1,193,964.

Further to the term time income derived from the nominations agreement and direct lets, the forecast

summer income for vacant ‘City University’ rooms, is projected at £224,474 for the 2013/2014 academic year.

Additionally, there is projected sundry income of £21,533.

The Estimated Rental Value of the vacant ground floor retail unit is £35,000 per annum. No business rates

are payable. Savills have attributed a value of £335,000 for this element, which reflects a yield of 10% on ERV.

It is expected the property can be managed at £2,000 per bed space per annum, which equates to a total of

£324,000 per annum.

The table below sets out the income profile for 2013/2014.

DESCRIPTIONCanto Court is a purpose built student scheme completed in 2008 and arranged over part seven/part eight

storeys. The scheme provides 164 self contained studio apartments; 13 basic studios, 131 classic studios and

20 premium range studios. All rooms include a double bed, private bathroom, study area, flat screen TV and

kitchen comprising a kettle, toaster, microwave oven and touch screen hob. Rent is inclusive of Wi-Fi, contents

insurance, all utility bills and a TV licence.

The lower ground floor comprises a common room, TV/cinema room, laundry room, landscaped courtyard

and bike storage facilities. The ground floor further comprises a management office and a vacant commercial

unit with a net internal area of approximately 100 sq m.

The property has 24 hour security with secure door systems and CCTV cameras.

ACCOMMODATION SCHEDULE

ROOM TYPE NUMBER OF BEDS SIZE (M2) BED SIZE

Basic Studio 13 17 Double

Classic Studio 131 17 Double

Premium Studio 20 19 – 35 Double

Total 164

ROOM TYPE BEDROOMS TERM LENGTH RENT PER WEEK OCCUPANCYGROSS RENT FOR

2013/2014

City University 91 40 £299 100% £1,088,360

Classic Studio 52 49.4* £315* 97% £784,896

Premium 1 9 51 £399 97% £177,646

Premium 2 2 51 £439 97% £43,434

Premium 3 8 51 £475 97% £187,986

Summer Income £224,474

Sundry Income £21,533

Total Gross Income £2,528,332

Management Costs -£324,000

Net Income £2,204,332

Note: Two bedrooms are used as show rooms and are not rented.

Note: 2 bedrooms, one Classic and one Premium One are used as show flats and not included in the above figures. These bedrooms can be rented. *Average figures

THIRD FLOOR PLAN

GROUND FLOOR PLAN

FLOOR PLANS

Not to scale - For indicative purposes only

Viewing: Strictly by appointment with Savills.

Important noticeSavills, 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, photographs 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. 10/13 303723

Savills (UK) Ltd 33 Margaret Street London W1G 0JD 020 7499 8644

savills.co.uk

TENUREThe property is held Freehold.

EPCThe property has an Energy Performance rating of B (43).

DATA ROOMPlease register at www.savills.com/cantocourt for more information.

SDLTThere may be the potential to claim Multiple Dwellings Relief and we would advise seeking the appropriate

professional advice in this regard.

VATNo VAT is chargeable on this transaction.

PROPOSALWe are instructed to seek offers in excess of £33,900,000 for our client’s freehold interest, which reflects

a net initial yield of 6.15% on the term time student income assuming purchaser’s costs of 5.80%.

CONTACTSMarcus Roberts James Hanmer Will Hyslop Lizzie Whetman

mroberts@savills.com jhanmer@savills.com whyslop@savills.com lwhetman@savills.com

M: 07807 999 187 M: 07967 555 897 M: 07812 965 456 M: 07807 999 174