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WIMBLEDON - 227-231 WIMBLEDON PARK ROAD, SOUTHFIELDSPRIME SOUTH-EAST FOODSTORE LET TO MARKS & SPENCER PLC ON A NEW 20 YEAR LEASE AND THE GYM LTD ON A NEW 20 YEAR LEASE WITH ANNUAL UPLIFTS
Sat Nav Ref: SW18 5RJ
Artist’s impression.
Retail property expertiseFawcett Mead 227-231 Wimbledon Park Road, Wimbledon
INVESTMENT HIGHLIGHTS
• Prime South-East Foodstore and Leisure Investment in an affluent greater London Suburb.
• Prominent new build development on Wimbledon Park Road.
• Freehold.
• Foodstore let to Marks & Spencer Plc on a new 20 year lease with RPI uplifts collar and capped at 1%-4%. Current net rent £400,000 per annum.
• Leisure element let to The Gym Ltd on a new 20 year lease with RPI uplifts collar and capped at 2%-4%, Current net rent £171,444 per annum.
• Current net income: £571,444 per annum.
• Offers are sought in excess of £12,000,000 (Twelve Million Pounds), subject to contract and VAT.
• A purchase at this level would reflect a Net Initial Yield of 4.5% after standard purchaser’s costs of 5.80%.
• Shown below is the annual rent and running yield based on the HM Treasury prediction of 3.16% average over the next five years:
Year Minimum Rent Running Yield
Year 5 £667,222 5.26%
Year 10 £779,986 6.14%
Year 15 £911,263 7.18%
Artist’s impression.
Retail property expertiseFawcett Mead 227-231 Wimbledon Park Road, Wimbledon
LOCATION
Wimbledon hosts the world famous tennis tournament, commonly known as “Wimbledon”, which is the oldest tennis tournament in the world and is widely considered the most prestigious. Held at The All England Club since 1877, it attracts over 490,000 to the area over the “Wimbledon” fortnight. Southfields tube station, located opposite the subject property is the closest transport hub to The All England Club.
Wimbledon is situated in the London Borough of Merton and lies 9 miles (14 km) south west of Central London. An attractive and affluent suburb, Wimbledon has established itself as a favoured retail and office location within an area of highly sought after residential property.
Southfields underground station is the primary public transport mode for the ‘All England’ Championships. Its is situated on the District Line which serves West London, Victoria and the city. The London Underground serves 1.265bn passengers per year with 208 million unsing the District Line, which is the busiest of the sub-surface lines.
Wimbledon mainline station provides frequent train services to London (Waterloo and Victoria) with a fastest journey time of under 20 minutes. In addition, Wimbledon is connected to the London Underground via South Wimbledon being con-nected to the Northern Line, there are also numerous bus services which serve the surrounding area.
Wimbledon has excellent communications lying 3 miles (5km) east of the A3 which provides direct access to the M25 (Junction 10) which is approximately 14 miles (22 km) to the south west. The South Circular (A205) lies 2.5 miles (4 km) to the north which connects all the south London Boroughs.
Subject Property
WimbledonAll England Lawn
Tennis Club
© www.bing.com
All England Lawn Tennis Club
Subject Property
Retail property expertiseFawcett Mead 227-231 Wimbledon Park Road, Wimbledon
RETAILING IN WIMBLEDON
Wimbledon ‘town’ is home to the principal retailing in Wimbledon, the street is dominated with department stores and key fashion multiples, with representation from Debenhams, Marks and Spencers, H&M, Next, River Island, Top Shop/Top Man and non-fashion multiples including Argos, Waterstones and WH Smith.
The Village is home to boutique fashion retailers, high end convenience stores and a number of restaurants and coffee houses. The Village offers an affluent shopping experience with fashion retailers such as Petit Bateau, The Kooples, LK Bennett and Molton Brown. Restaurants in the area include Carluccio’s, Café Rouge, Paul, Aubaine and Le Pain Quotidien.
Anecdotally we understand M&S have been seeking representation here for in excess of 10 years.
SITUATION
The subject property is strategically located fronting onto Wimbledon Park Road close to the junction of Replingham Road and August Road. Southfields London Underground Station is located at the same junction, which means the subject property benefits from high levels of footfall due to the high number of commutes using the station to commute to central London.
The All England Club, which host “Wimbledon” tennis tournament each year is located 0.7 miles to the south of the property. Central Wimbledon is located approximately 2 miles to the south of the property.
Prime South-East Foodstore and Leisure Investment on Wimbledon Park Road
Retail property expertiseFawcett Mead 227-231 Wimbledon Park Road, Wimbledon
SOCIO-ECONOMIC PROFILE
Wimbledon is one of London’s most affluent and desirable residential suburbs. House prices are reported to have risen by up to 686% since 1995 significantly outperforming the UK average (House.co.uk).
The socio-economic profile of the area is very affluent, being well above the GB average, summarised below:
Source: Experian
DESCRIPTION
The subject property is a newly constructed purpose built foodstore with gym below. The upper parts consist of residential accommodation, which have been sold off on a long lease.
ACCOMMODATION
The Plowman Craven measured areas are as follows:
227-231 Wimbledon Park Road Sq Ft
Ground Floor (GIA) 10,597
Basement (GIA) 13,188
Total 23,785%
45
40
35
30
25
20
15
10
5
0In employment Education:
Higher Degree/Degree
Managers & Senior Officials
Professional occupation
TENURE
Freehold.
TENANCY
Retail DemiseLet to Marks and Spencer Plc for a term of 20 years at a commencing rental of £400,000 per annum with 5 yearly compounded annual uplifts linked to RPI collared and capped at 1-4%.
D2 DemiseLet to The Gym Ltd for a term of 20 years at a rental of £171,444 per annum, with 5 yearly compounded annual uplifts linked to RPI collared and capped at 2-4%. There is a tenant only break clause at the 15th anniversary of the commencement of the term.
The upper residential parts are sold off on a long lease.
Total net income: £571,444 per annum.
Wimbledon National Average
Artist’s impression.
Retail property expertiseFawcett Mead 227-231 Wimbledon Park Road, Wimbledon
Marks and Spencer was established in 1894 and now operates from over 798 stores across the UK ranging from out of town formats as well as standalone Simply Food store formats.
The company employs over 85,000 people across 54 countries worldwide and reported a total turnover in excess of £10.3 billion in the year to April 2014.
Food sales now account for almost 50% of the company’s total turnover, amounting to revenue of £5.1 billion.
Marks and Spencer Plc financial results for the last three years are summarised below:
Marks and Spencer Plc 29/03/2014 30/03/2013 31/03/2012 £’000 £’000 £’000
Sales Turnover £10,309,700 £10,026,800 £9,934,300
Pre-Tax Profit £580,400 £564,300 £568,000
Net Worth £4,384,000 £4,375,000 £4,787,800
The Gym Group was founded in 2008 by John Treharne, a former England squash player, who has a successful history in the gym business. He opened his first health club chain, Dragons Health Clubs, in 1991, building the business to a total of 22 clubs. He floated the company in 1997, and in 2000 he and his investors sold it on. He then spent time lending his expertise to premium gym chain Esporta, before concentrating on the launch of The Gym Group.
Within the first three years The Gym Group opened 20 gyms and now operate over 38 gyms nationwide, with 109 employees and an increasing pipeline.
The Gym Group has been funded and supported, since inception in 2008, by Bridges Ventures who have committed £17.5 million to the business. Bridges has £275 million under management and has a 10 year track record in investing successfully to achieve social and environmental goals as well as delivering substantial financial returns.
The company has a 2015 D&B rating of 5A1 and an Experian 2013 Credit Score of “A Excellent” and key trading data for the last three years is set out below:
The Gym Limited 31/12/2013 31/12/2012 31/12/2011
Turnover £36,179,487 £22,631,844 £13,464,109
Pre-Tax Profit £5,335,749 £722,410 £(265,804)
Net Worth £41,496,847 £(300,170) £(538,020)
COVENANT INFORMATION
Retail property expertiseFawcett Mead 227-231 Wimbledon Park Road, Wimbledon
RENTAL ANALYSIS
We have analysed the passing rents as follows:
Area sq ft Rent Rent psf
Marks And Spencer 10,597 £400,000 £37.75
The Gym 13,188 £171,444 £13.00
RENTAL EVIDENCE
Location Tenant Transaction Date GIA (sq ft) £/ft2
Morden Asda OML February 2015 10,700 £32.70
Queen’s Park Marks & Spencer OML June 2014 5,580 £30.82
Aldgate East Tesco OML April 2013 3,356 £33.56
Ferndown, Dorset Marks & Spencer AGL April 2013 11,000 £32.50
Reading Marks & Spencer OML March 2013 15,000 £30.00
Richmond Whole Foods OML March 2013 20,150 £34.00
The retail tenant secured the premises in a competitive bidding situation. Alternative operators offered a higher rental level, however, the current owner chose to proceed with Marks & Spencer.
Prime London Foodstore let to Marks & Spencer Plc on a new 20 year lease and The Gym Ltd on a new 20 year lease with annual uplifts
Retail property expertiseFawcett Mead 227-231 Wimbledon Park Road, Wimbledon
Misrepresentation Act: The particulars in this brochure are believed to be correct, but accuracy cannot be guaranteed and they are expressly excluded from any contract. Designed by Graphic Outlines Ltd October 2015
VAT The property has been elected for VAT purposes. It is anticipated that the sale will be treated as a Transfer of a Going Concern (TOGC).
PROPOSAL
We are instructed to seek offers in excess of £12,000,000 (Twelve Million Pounds), subject to contract and VAT. Assuming standard purchaser’s costs at 5.80%, a purchase at this level would reflect a net initial yield of 4.50%, and the following minimum running yield:
Year 3.16% uplift Running Yield
Year 5 £667,622 5.26%
Year 10 £779,986 6.14%
Year 15 £911,263 7.18%
(Based upon HM Treasury RPI predictions of 3.16% average over the next 5 years.)
EPC
An Energy Performance Certificate is available on request.
SUBJECT TO CONTRACT
FURTHER INFORMATION
James Mead020 7182 [email protected]
15-17 Great Portland Street, London W1W 8QA
Thomas Heptonstall 020 7182 [email protected]
Mathew Chandler020 7659 [email protected]
Dixon Wright, 66 Grosvenor Street, London W1K 3JL
Joint Agent
The Gym Group
For indicative purpose only.