winchester road, basingstoke, rg22 6hn · hobbycraft and axminster tools & machinery |...

OPEN A1 RETAIL WAREHOUSE INVESTMENT SITUATED IN BASINGSTOKE’S ESTABLISHED OUT OF TOWN RETAIL LOCATION

WINCHESTER ROAD, BASINGSTOKE, RG22 6HNENTER

Investment Highlights

HOBBYCRAFT AND AXMINSTER TOOLS & MACHINERY | WINCHESTER ROAD, BASINGSTOKE, RG22 6HN

Basingstoke is an economically vibrant town in Hampshire, 48 miles south west of London.

The town is one of the most affluent in the country, ranking 16th out of the top 200 PMA Retail Centres.

The subject property is located in a prominent and easily accessible position, fronting the A30 Winchester Road.

The scheme forms part of the prime retail warehousing pitch for Basingstoke.

The park is let to Hobbycraft and Axminster Tools & Machinery, providing an attractive WAULT of 7.7 years.

The current passing rent is £307,480 per annum reflecting a low average rent for the town of £17.31 per sq ft.

Axminster Tools & Machinery have a fixed uplift in August 2017.

Unrestricted open A1 planning consent including food.

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PLANNING, ERV & TENANTS’ COVENANTS

DESCRIPTIONSITUATION & RETAIL WAREHOUSING IN BASINGSTOKE

LOCATION

We are seeking offers in excess of £4,810,000 (Four Million, Eight Hundred and Ten Thousand Pounds). A purchase at this level reflects an attractive net initial yield of 6.00%, increasing to 6.20% in August 2017, assuming purchaser’s costs of 6.58%.

LocationBasingstoke is the largest town in Hampshire, located 30 miles north east of Southampton, 19 miles north east of Winchester, and 48 miles south west of London.

The town benefits from excellent road links by virtue of its proximity to Junctions 6 and 7 of the M3, which connects to London and the M25. Rail links are also excellent with regular trains to London with a journey time of 45 minutes. As a result, the town is a popular place with commuters.

Heathrow Airport is located 35 miles to the north east and Gatwick Airport lies 60 miles to the east of the town.

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East GrinsteadCrawley

HaywardsHeath

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Reigate

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Chichester

Haslemere

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Winchester

Eastleigh

Petersfield

Newbury

Reading

Portsmouth

Southampton

Littlehampton

Aldershot

Fareham

BracknellCroydon

EpsomSutton

Kingstonupon Thames

Maidenhead Uxbridge

BrightonHove

WorthingBognor Regis

Guildford

WokingCamberley

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Slough LONDON

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LOCATION

Catchment & DemographicsBasingstoke has become a vibrant and important economic centre, partly through its connectivity to the UK and Europe, and consequently is home to the UK headquarters of De La Rue, Sun Life Financial, The Automobile Association, ST Ericsson, GAME, Motorola, Barracuda Networks, Eli Lilly and Company, BNP Paribas Leasing Solutions (the leasing arm of BNP Paribas in the UK) and Sony Professional Solutions. Other industries include publishing, IT, telecommunications, insurance and electronics.

Due to its excellent road links, Basingstoke benefits from a primary catchment population of over 227,000 people, extending over 15 miles northwest and 21 miles south on either side of the M3. The estimated shopping population (PMA) is over 208,000 people. There are 87,420 people living within a 10 minute drive time of the subject property, extending to 144,896 people within a 20 minute drive time.

Basingstoke benefits from having one of the most affluent catchment populations in the UK, ranking 16th out of the top 200 PMA Retail Centres. The relative affluence of the town is demonstrated as follows:

Affluence Indicator Basingstoke PMA Top 200 Centre Average

Basingstoke Rank (Top 200 PMA Centres)

Per capita in-store comparison retail expenditure 2011 £2,980 £2,655 13

Per capita retail warehouse expenditure 2011 £612 £549 n/a

Forecast growth in retail expenditure 2016-2021 (% p.a. real) 2.4% 2.1% 36

% of population within AB Social Group 32% 22% n/a

% of population within DE Social Group 17% 26% n/a

Gross weekly wages 2016 £531 £438 14

Claimants as % population aged 16-64 Dec 2012 0.6% 1.2%* 31

Average house price Q3 2016 £345,700 £343,900 41

Households with 2+ cars 46% 33% n/a

* GB population

Basingstoke and Deane Borough Council are keen to further promote and grow the town. The Local Plan adopted in May 2016 provides for 15,300 new homes to be built between 2011 and 2029, mostly around the immediate Basingstoke connurbations. Notably 3,400 new homes are planned on a 2,000 acre site in Manydown, Basingstoke, 2 miles north of the subject property.


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HanningtonHannington

OvertonOverton

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MicheldeverMicheldever

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Upton GreyUpton Grey

SouthWarnboroughSouthWarnborough

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KingsleyKingsley

HeadleyHeadley

ChurtChurt

FrenshamFrensham

ElsteadElstead

East TistedEast Tisted

SelbourneSelbourne

Four MarksFour Marks

BordonBordon

AltonAlton

Church CrookhamChurch Crookham

CrondallCrondall

FleetFleet

FrimleyFrimley

BagshotBagshotCrowthorneCrowthorne

EversleyEversley SandhurstSandhurst

MattingleyMattingley

HookHook

Sherfieldon LoddonSherfieldon Loddon

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AldermastonAldermaston

CrookhamCrookham

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WOKINGHAMWOKINGHAMBRACKNELLBRACKNELL

NEWBURYNEWBURY

BASINGSTOKEBASINGSTOKE

READINGREADING

HOME AERIAL TENANCIES & TENURE





LOCATION CATCHMENT & DEMOGRAPHICS

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TENANCIES & TENURE





LOCATION AERIAL

Retail Warehousing in BasingstokeBasingstoke benefits from limited competition from surrounding towns, with Reading being the town’s main retail competitor, a 30 minute drive to the north. Retail warehousing space is also fairly limited with a number of occupiers unrepresented in the town and hence unsatisfied demand remains.

The main retail warehouse pitch for Basingstoke focuses around Brighton Hill Roundabout, where the dominant scheme is Brighton Hill Retail Park.

Other retail warehousing in proximity includes a standalone Homebase unit, a two unit scheme let to Maplin and Halfords and a standalone Home Bargains unit. B&Q also have a solus unit close by. The main schemes in the town are as follows:

1. Brighton Hill Retail Park (LaSalle Investment Management)This is the dominant bulky goods scheme in Basingstoke anchored by Currys PC World, DFS, and Toys ‘R’ Us. Further occupiers include Carpetright, Harveys, Staples, Pizza Hut and McDonald’s.

2. Hatch Warren Retail Park (South Yorkshire Pension Fund)This scheme totals 42,000 sq ft and is let to Pets at Home, Dreams, Argos, Bensons and Poundstretcher. In close proximity is an 85,000 sq ft Sainsbury’s and 2 units occupied by Mothercare and American Golf.

3. Gaston Wood Retail Park (various)This is a collection of units occupied by Dunelm (22,700 sq ft), Lidl (13,500 sq ft ), The Range (55,000 sq ft) and Go Outdoors (54,000 sq ft across 2 units).

4. Chineham District Centre (Legal & General)This is a 171,000 sq ft district centre anchored by Tesco. There are 4 retail warehouse units occupied by M&S Simply Foods, Boots, Poundland and Matalan. In addition there are several smaller retail units let to occupiers including Iceland, Subway, Natwest, Greggs and Superdrug.

There is a former Smiths Industries site to the rear of Brighton Hill Retail Park, where the developer, Area Estates, is proposing to submit a planning application for a bulky goods development, anchored by an Aldi store. Planning was however previously refused at appeal for a 63,000 sq ft Tesco supermarket.

SituationThe property is situated in the heart of the main retail warehouse pitch for the town, with Brighton Hill Retail Park, attracting the main focus of retail warehousing. Retailers in close proximity include Halfords, Maplin, Home Bargains, Toys “R” Us, DFS, Currys PC World, Homebase and Harveys.

The subject property also benefits from being situated on the main Brighton Hill Roundabout and has good prominence and visibility from the A30 Winchester Road.

Access to the scheme is from Brighton Hill Roundabout directly off Winchester Road.

Improvements are being made to the A30 Winchester Road which are due to be completed Summer 2017. These include widening the roundabout on the approach road to ease heavy traffic flows.

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HATCH WARREN RETAIL PARK

GASTON WOOD RETAIL PARK

CHINEHAM DISTRICT CENTRE

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LOCATION

DescriptionThe subject property comprises a purpose built single retail warehouse unit which has been subdivided into 2 units occupied by Hobbycraft and Axminster Tools & Machinery, totalling 9,900 sq ft and 7,972 sq ft respectively.

The units have a steel portal frame with metal profile clad elevations. The elevations to the rear and side of the units can easily be seen from the Winchester Road and Brighton Hill Roundabout, and both clearly display the respective tenants’ signage.

Internally, both the units are fitted out to each individual tenant’s specification. Hobbycraft benefits from having a mezzanine floor used for sales, and the Axminster Tools & Machinery unit has a storage mezzanine.

Customer car parking is located to the front and to the eastern side of the scheme, providing a total of 88 spaces, equating to an attractive ratio of 1 : 202 sq ft.

Servicing is to the rear side of the Axminster Tools & Machinery unit. A service corridor at the rear, links the Hobbycraft unit with the service yard.

The site area extends to approximately 1.52 acres, giving a low site cover of 27%.








LOCATION


TenanciesThe scheme is fully occupied to Hobbycraft Trading Ltd and Axminster Tool Centre Ltd on FRI leases. Hobbycraft have had their break option recently removed, providing an attractive income weighted unexpired lease term across the scheme of 7.7 years.

Unit Tenant GIA (sq ft)

Lease Start Date

Lease Expiry Date

Next Rent Review

Current Rent (per annum)

Rent (per sq ft)

Comments

1 Hobbycraft Trading Ltd

9,789 13/08/2010 12/08/2025 13/08/2020 £198,000 £20.23 Service corridor is not rentalised. There is a rent review cap of £229,536 at review in August 2020.

2 Axminster Tool Centre Ltd

7,972 30/08/2013 29/08/2023 30/08/2018 £109,480 £13.73 Fixed uplift to £117,300 per annum (£14.71 per sq ft) from 30 August 2017 until 29 August 2018, reviews upwards only to open market rental value thereafter. Lease guaranteed by Styles & Brown.

Total 17,761 £307,480 £17.31

TenureThe property is held freehold with the demise as delineated in red on the plan opposite.

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AERIALINVESTMENT HIGHLIGHTS




LOCATION TENANCIES & TENURE

PlanningIn 2012, a Certificate of Lawful Use was granted, giving the scheme an unrestricted open A1 planning consent, thereby allowing the sale of all open A1 retail goods including food.

ERVThe current lettings were undertaken in 2010 and 2013 to Hobbycraft and Axminster Tools & Machinery respectively. The later letting was carried out at a particularly challenging time for the retail warehouse market, which has significantly improved since. In particular, South-East located schemes, have seen rents increase and incentive levels reduced.

Opposite the subject property, Halfords pay a rent reflecting £21.46 per sq ft on their 11,700 sq ft unit and Maplin at £21.86 per sq ft on their 4,354 sq ft unit.

Rents on Brighton Hill Retail Park are in excess of £24.00 per sq ft on 15,000 sq ft units. There is no available space on this scheme, but we understand, an offer was recently made for a 10,000 sq ft unit here at a rent of £30.00 per sq ft, well in excess of the current passing rents across the scheme.

If the proposed redevelopment of the former Smiths Industries site is granted consent, this should also help establish a new rental tone for Basingstoke. We understand retailers are agreeing terms at rents between £25.00-£28.00 per sq ft, depending on unit size.

Tenants’ CovenantsFounded in 1995, Hobbycraft are the largest arts and crafts retailer in the UK with over 85 stores nationwide. The company was bought by investment group Bridgepoint in 2010, who have invested heavily into the retailer, revamping the stores and opening new units across the country.

Axminster Tool Centre Ltd are a family business which has been in operation for over 40 years. The company has 8 stores across the UK but has also established itself as a market leader in the mail order tools and machinery industry, catering for trade professionals and businesses to amateur DIY and hobby enthusiasts.

Styles & Brown Ltd are lease guarantors and is the parent company to Axminster Tool Centre Ltd. The majority of their revenue comes from the Axminster Tool Centre Ltd business.

Both tenants are profitable and have a low risk of business failure being rated ‘A1’ by D&B. A summary of the most recent tenant accounts are as follows:

Tenant Year Ending Sales Turnover (000’s)

Pre-Tax Profit

(000’s)

Net Worth (000’s)

D&B Rating

Hobbycraft Trading Ltd

21/06/2016 £151,760 £4,721 £53,8775A1

22/02/2015 £141,073 £457 £50,004

Axminster Tool Centre Ltd

30/04/2016 £40,810 £1,222 £5,4632A1

30/04/2015 £35,471 £357 £4,556

Styles & Brown Ltd

30/04/2016 £40,828 £1,303 £5,4752A1

30/04/2015 £35,471 £470 £4,487






PLANNING, ERV & TENANTS’S COVENANTS


LOCATION

EPCUnit 1 (Hobbycraft) has an EPC rating of C61.Unit 2 (Axminster) has an EPC rating of C60.

VATThe property is elected for VAT and we would expect the transaction to be treated as a Transfer of a Going Concern.

ContactEllie KirkbyT: 020 7317 3790M: 07764 241898E: [email protected]

Wilkinson WilliamsHeathcoat House, 20 Savile RowLondon W1S 3PR

www.wilkinsonwilliams.co.uk

MISREPRESENTATION NOTICE. Wilkinson Williams LLP 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. May 2017. Designed and produced by Creativeworld Tel: 01282 858200


ProposalWe are seeking offers in excess of £4,810,000 (Four Million, Eight Hundred and Ten Thousand Pounds). A purchase at this level reflects an attractive net initial yield of 6.00%, increasing to 6.20% in August 2017, assuming purchaser’s costs of 6.58%.







LOCATION

mailto:[email protected]

http://www.wilkinsonwilliams.co.uk

winchester road, basingstoke, rg22 6hn · hobbycraft and axminster tools & machinery |...

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