Autism Care Home Investment

Well secured autism care home investment with 27 years unexpired

Tanglewood Mews, Wylam Road, Stanley, County Durham DH9 0EJ

LocationStanley is located 9 miles (14.5 km) north of Durham and 10 miles (16.3 km) south of Newcastle. The town has good communications being situated approximately 6 miles (10 km) west of junction 63 of the A1(M) with direct access from the motorway along the A693.

Chester-Le-Street is situated 6 miles (10 km) to the east and is on the East Coast Mainline with shortest journey times of two hours to Edinburgh and 50 minutes to York. Newcastle International Airport is located 14.6 miles (23.4 km) to the north.

Stanley, a market town, benefits from a population of approximately 20,000 persons and a district population of approximately 54,000 persons. It provides the home for the Beamish Museum, the world famous open air museum telling the story of life in the north east over the past two centuries.

SituationThe property is situated on the south side of View Lane immediately to the west of its junction with Wylam Road. The property is located in a densely populated residential area a short distance to the north east of the town centre.

Investment Considerations ■ Modern autism care home investment providing 23 bedrooms constructed in 2008.

■ Currently producing a rent of £347,782 pa (topped up to March 2017)

■ 27 years unexpired with no breaks

■ Strong covenant - Let to Autism Care UK (4) Ltd with a guarantee from Lifeways Finance Ltd (net worth of £96m)

■ Annual rental uplifts of a minimum of 3%

■ Gross Internal Area 13,387 sq ft (1,243.7 sq m)

■ Planning consent to increase the number of beds in future to circa 40.

■ Freehold

■ Our client is seeking offers in excess of £5,000,000 (Five million pounds) subject to contract and exclusive of VAT, reflecting a net initial yield of 6.6% assuming purchaser’s costs of 5.8% based on the topped up rent of £347,782 pa. This yield rises annually based on the minimum 3% pa uplifts

A6076 H

ig h Street

View Lane

Wylam Road

A693

A6076Sunny Terrace

Barn Hill

Description

The property, which was constructed in 2008 and opened in 2009 comprises a purpose built 23 bedroom residential care home.

It provides a gross internal area of 13,387 sq ft (1,243.7 sq m) and it has a very low site coverage of 14%.

The property is divided into five self-contained units each providing their own kitchen and space for the care staff that are in each unit at all times. The buildings named Maple and Olive are arranged over two stories and provide seven ensuite bedrooms as well as communal space. Each of these units has a lift. The remaining three units are arranged over ground floor only and provide three apartments each with a bedroom, living room and bathroom.

The property is on a broadly rectangular site which is mostly level apart from the access road from View Lane.

Tenancy

The property is let to Autism Care UK (4) Ltd for a term of 30 years from 22 March 2012 (expiring 21 March 2042) at a topped up rent of £347,782 pa (March 2017) on a full repairing and insuring basis. The lease is guaranteed by Lifeways Finance Ltd.

The lease states that the rent is reviewed each year. In even years ‘‘the rent shall be increased by the greater of the sum determined by multiplying the passing rent by 103% or EBITDA divided by 2’’. In odd years ‘‘the rent will be increased by the sum determined by multiplying the passing rent by 103%. We understand that the rent is therefore to be increased by a minimum of 3% annually.

The lease is outside the L&T 1954 Act.

Tenure

Freehold

Planning

The original planning permission (1/2006/0442) allowed ‘the erection of a special needs health care centre’ comprising three separate units. Only one of these has been constructed to date but as development has lawfully ‘commenced’ on site the permission remains valid in perpetuity. The additional units for which planning consent has been granted would provide a further 18 beds.

CovenantAutism Care UK Ltd (4) is Part of Lifeways Group. Lifeways is one of the leading specialist support providers in the UK, supporting over 4,750 people with complex needs. In addition, Lifeways is also the UK’s largest supported living provider supporting over 3,500 people and has in excess of 7,500 employees. The Guarantor, Lifeways Finance Ltd is rated 5A1 by Dun and Bradstreet which represents a minimum risk of business failure and is financed and owned by Omers, a Canadian Pension Fund.

Autism Care UK (4) Ltd

30/04/2013 30/04/2014

Turnover £1,940,766 £1,743,845

Pre-Tax profit £273,111 £162,291

Total Net Worth £193,537 £357,011

Lifeways Finance Ltd

31/05/2013 31/08/2014

Turnover £355,000 £772,166

Pre-Tax profit £134,819,638 £2,665,046

Total Net Worth £93,747,948 £96,412,994

Track

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WYLAM ROAD

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Tanglewood Mews

Ordnance Survey © Crown Copyright 2015. All rights reserved. Licence number 100022432. Plotted Scale - 1:972© Crown Copyright, ES 100004106. For identification purposes only.

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. Design: CommandD www.commandHQ.co.uk 05.15

Alex Butler020 7543 6722alex.butler@allsop.co.uk

Jeremy Hodgson020 7543 6709jeremy.hodgson@allsop.co.uk

For further information or to make arrangements for viewing please contact:

Dominic Ketteringham020 7543 6833dominic.ketteringham@allsop.co.uk www.allsop.co.uk

Proposal Our client is seeking offers in excess of £5,000,000 (Five million pounds) subject to contract and exclusive of VAT, reflecting a net initial yield of 6.6% assuming purchaser’s costs of 5.8% based on the topped up rent of £347,782 pa (March 2017).

EPCAn EPC has been commissioned.

VATThe property will be subject to VAT although we anticipate the sale will be treated as a Transfer of a Going Concern.