convenience store investment tesco express, · tesco is the united kingdom’s largest grocer and...

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Convenience Store Investment Tesco Express, 113 Tregonissey Road, St Austell PL25 4DC Tesco Convenience Store Investment 3,894 sq ft (362 sq m) on a site area of 0.36 acres let to Tesco Stores Ltd (5A1 Covenant) Passing Rent £48,000 20 year lease from 1 October 2012 Freehold £700,000 subject to contract 6.48% net initial yield rising to 7.33% following the 2017 review (using a conservative RPI growth at 2.5%)

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Page 1: Convenience Store Investment Tesco Express, · Tesco is the United Kingdom’s largest grocer and the world’s third largest grocery retailer with operations in 12 international

Convenience Store Investment

Tesco Express, 113 Tregonissey Road, St Austell PL25 4DC

Tesco Convenience Store Investment

3,894 sq ft (362 sq m) on a site area of 0.36 acres let to TescoStores Ltd (5A1 Covenant)

Passing Rent £48,000

20 year lease from 1 October 2012

Freehold

£700,000 subject to contract

6.48% net initial yield rising to 7.33% following the 2017 review(using a conservative RPI growth at 2.5%)

Page 2: Convenience Store Investment Tesco Express, · Tesco is the United Kingdom’s largest grocer and the world’s third largest grocery retailer with operations in 12 international

LocationSt Austell, is located on the south coast of Cornwall approximately 20miles (32 km) west of Plymouth and 15 miles (24km) north east of Truro.

Principle Road Access is via the A391 which connects with the A30 trunkroad about 12 miles north of the town and the A390 which connectswith the A38 at Liskeard about 20 miles to the east. The town is servedby a station on the Penzance to London Paddington mainline.

Newquay Airport approximately 16 miles to the north west providesscheduled domestic services to London Gatwick and a number ofregional destinations.

SituationThe subject property is situated on Tregonissey Road which is adistributor road bordering the north western edge of the town andconnecting at its northern end with the A391 and with the town centreand the A39 to the south. Tregonissey Road has mixed commercial andresidential users along its frontage, including Cornwall College and theSt Austell Brewery which lies approximately 500m to the west.

The area is one which is attracting some expansion with new housingdevelopments by Wain Homes and Taylor Wimpey and further expansionaround the A391 corridor planned.

DescriptionThe subject property has painted brick elevations with some UPVCcladding and flat roofs, UPVC window casements with double glazing andfeatures signage to the east elevation advertising the property as a TescoExpress. To the east of the main building is a surfaced car park area whichcurrently accommodates 19 car parking spaces.

AccommodationWe understand the gross internal area of the property to be as follows:

SiteWe estimate the site area to be approximately 0.36 acres (0.15 Hectares)

Ground – Retail 284.6 sq.m 3,063 sq.ft.First - Staff/stores 77.2 sq.m 831 sq.ft.TOTAL 361.8 sq.m 3,894 sq.ft

Page 3: Convenience Store Investment Tesco Express, · Tesco is the United Kingdom’s largest grocer and the world’s third largest grocery retailer with operations in 12 international

TenureFreehold

TenancyThe entire property is let for 20 years to Tesco Stores Limited under theterms of a lease dated 1 October 2012 at a passing rent of £48,000 perannum. There is a tenancy option to break on expiry of the 10th year of theterm.

The rent is to be reviewed at five yearly intervals in an upward only direction.Rent reviews are to be linked to the All Items Retail Price Index with a capof 4% and a collar of 0% per annum.

Value Added TaxThe property is registered for VAT, and VAT will be payable on the sale.It is assumed the matter will be dealt with via a TOGC.

CovenantTesco trade from approximately 2,200 stores worldwide and are theworld’s third largest grocery chain, and the largest grocery chain in theUK.

They have a Dun & Bradstreet rating of 5A1, which represents minimumrisk of business failure.

Tesco Stores Limited (Co. No.519500) has reported the following figures:

The principal activity of the company is the operation of food stores andassociated activities throughout England, Scotland, Wales and NorthernIreland.

The company’s ultimate parent undertaking and controlling party is TescoPLC, a FTSE 100 Company. Tesco is the United Kingdom’s largest grocerand the world’s third largest grocery retailer with operations in 12international markets, employing some 530,000 people in 4,331 storesworldwide. Tesco has some 3,000 stores in the United Kingdomemploying over 300,000 staff. By format Tesco’s Express brand is theirlargest with some 1,500 stores. For further information please visitwww.tescoplc.com.

23rd Feb 2013 23rd Feb 2012

Turnover £42,662 million £41,981 millionPre-Tax Profits £921 million £2,126 millionShareholders’ Funds £3,255 million £7,048 million

Page 4: Convenience Store Investment Tesco Express, · Tesco is the United Kingdom’s largest grocer and the world’s third largest grocery retailer with operations in 12 international

ContactAltitude InvestmentsA Singer Vielle Franchisee [email protected] Southernhay WestExeterEX1 1PRTel: 01392 660 000Mobile: 07815 867 807

www.altitude-investments.com

Singer Vielle94-96 Wigmore Street [email protected] W1U 3RFTel: 020 7935 7200 [email protected]: 020 7486 8511www.singerviellesales.com [email protected]

Vendors Solicitor

Stephens & ScownCurzon House, [email protected] West,Exeter, DevonEX1 1RS

ProposalOur client is seeking offers in the region of £700,000 subject to contract,reflecting a net initial yield of 6.48% rising to 7.33% following the 2017review (using RPI growth at 2.5%)

Investment Considerations

Subject to contract and exclusive of VAT

Misrepresentation Act 1967Singer Vielle for themselves and for the Vendors or Lessors of this property whose Agents they are give notice that:1. The particulars are set out as a general outline only for the guidance of intending purchasers or lessees, and do not constitute, nor constitute part of, an offer or contract2. All descriptions, dimensions, references to condition and necessary permissions for use and occupation, and other details are given in good faith and are believed to be correct but any intending purchasers or tenants should not rely on them as statements orrepresentations of fact but must satisfy themselves by inspection or otherwise as to the correctness of each of them.3. No person in the employment of Singer Vielle has any authority to make or give any representation or warranty whatever in relation to this property.4. All maps are for identification purposes only and should not be relied upon for accuracy.5. Unless otherwise stated, all prices and rentals quoted are exclusive of Value Added Tax to which they may be subject.

Finance Act 1989Unless otherwise stated, all prices and rents are quoted exclusive of VAT.

Property Misdescriptions Act 1991These details are believed to be correct at the time of compilation, but may be subject to subsequent amendment.

Concerning the Properties listed and/or appearing on the Site:1. Under no circumstances shall we be liable to you for any direct, indirect, consequential, incidental or special damages arising out of your purchase or lease of any Properties on the Site.2. Under no circumstances shall we be liable for any errors or incompleteness of the information relating to any Property listed on this Site or if any Property has been withdrawn from sale or lease nor shall we be responsible for any inaccurate dimensions of anyProperties or price listed.3. Our website service permits you to enquire about and to purchase or lease Properties appearing on or listed on this Site. Such enquiries, purchase or leasing can only be made and permitted strictly subject to the terms and conditions set out below.4. We do not accept responsibility or liability for the completeness or accuracy of information appearing on this Site which is provided by the Vendors or Lessors of the Property concerned who are solely responsible for such information.5. Whilst we believe that the Properties listed are available for purchase or lease we make no guarantee that this is the case or that they have not been withdrawn by the Vendor or Lessor of the same. All Properties appearing or listed on the Site are subject to changes,errors or omissions. We have not verified the accuracy of the information relating to the Properties or any dimensions which have been given by the Vendors or Lessors.6. All Properties are listed subject to contract and the prices shown are exclusive of VAT if applicable.