linford wood business centredocs.novaloca.com/48_jll28087_634951181620478776.pdf · 2013-02-04 ·...

HIGH YIELDING MULTI-LET OFFICE INVESTMENT OPPORTUNITY

LINFORD WOOD BUSINESS CENTRE

MILTON KEYNES

INVESTMENT SUMMARY

• Milton Keynes is one of Europe’s fastest growing centres and is projected to become one

of the top 15 largest towns by 2031. The town has easy access to the national motorway

network (via the M1) and excellent rail services to the north and south of the country.

• The property is only three miles from both Milton Keynes Central station and the

M1 motorway (junction 14).

• Five self-contained buildings on an attractive, landscaped campus with a total

area of 10,993 m2 (118,330 ft2) and an excellent car parking ratio of 1:25 m2 (1:266 ft2).

• The property is held freehold.

• Let to 5 tenants and produces a rental income of £887,399 per annum which equates to

a low overall base rent of only (£113 per m2) £10.47 per ft2.

• 94% of the income is rated by D&B as having a minimum risk of business failure.

• Offers are sought in the region of £7,000,000 (Seven Million Pounds), subject to contract

and exclusive of VAT.

• A purchase at this level refl ects an attractive net initial yield of 12% assuming

purchasers’ costs of 5.8% and a low capital value of only £59 per ft2.

• The yield on letting the vacant units improves to 16.5%.

LINFORD WOOD BUSINESS CENTRE MILTON KEYNES 2

MILTON KEYNES

Milton Keynes has become a major centre for industry and commerce over the past 30 years and is considered one of the UK’s fastest growing

centres, with three times the national average population growth. This has been driven by the Milton Keynes Partnership (MKP) Committee

(www.miltonkeynespartnership.info) which was established to implement the delivery of this growth and plays a key role in ensuring infrastructure,

jobs and community facilities in a coordinated fashion.

Milton Keynes is the UK’s 30th largest town and is the fastest growing urban area. It has an estimated population growth rate of 14.2% for 2004 - 2011

(national average is 3.1%). It is projected that the town will double in size through sustainable growth by 2031 and become the UK’s 10th largest

centre. 7.5 million people live within an hour’s drive of Milton Keynes. The Government plans to facilitate for 100,000 new jobs and 68,600 new homes

in the area over the same period.

The town has a highly diverse local economy and it is increasingly seen as a major regional centre. 75% of businesses in the town have their

headquarters there. It has attracted a wide range of national and international occupiers including Foreign & Commonwealth Offi ce, Network Rail, BP,

EDS, Santander, British Telecom, Siemens, Cable & Wireless, Unisys, Deloitte, Volkswagen and Daimler Chrysler.

The town centre offers excellent amenities which are centred around Centre:MK and Midsummer Place shopping centres. Together they comprise

156,072 m2 (1.68 million ft2) and make up one of the UK’s largest shopping destinations with over 260 retailers and four major department stores

(Debenhams, John Lewis, Mark & Spencer and House of Fraser).



LOCATION AND COMMUNICATIONS

Road

Milton Keynes is located approximately 52 miles north-west of Central London, 73 miles south-east of Birmingham and three miles west of the M1

motorway. The town benefi ts from its location midway between London and the Midlands with easy access provided to the M1 motorway, at junctions

13 and 14, and the A5 trunk road. The M6 and M40 motorways are also within easy reach of the town.

The M1 has been widened between junctions 10 and 13 from three to four lanes. There have also been improvements made to junctions 13

and 14.

M25 - 33 miles Heathrow Airport - 56 miles

M1 - 3 miles Birmingham Airport - 64 miles

M6 - 35 miles Stansted Airport - 73 miles

M40 - 32 miles Gatwick Airport - 90 miles

Luton Airport - 22 miles

The road layout in Milton Keynes is designed to accommodate high levels of car usage

which combined with highly functional land use planning has led to commercial and

industrial uses being segregated from residential areas enhancing access around the

town. Public transport is constantly being improved and it is recognised that it plays a

major role in the town’s future.

Rail

Milton Keynes is well served by London Midland, Virgin and South Central rail companies,

with trains running every 10 minutes to London Euston, and a fastest journey time of

30 minutes. To the north, trains run every 20 minutes direct to Birmingham (1 hour),

Manchester and Glasgow. South Central also provides an hourly service to East Croydon,

running via West London and connecting with services to Brighton.

Between the three operators, six trains per hour head north and eight per hour south

from the station. The town is therefore within convenient business travelling distance of

Britain’s commercial heartlands in the Midlands and the South East.

A £130 million major upgrade of the railway station has been put in place including two

extra tracks and another platform to allow more Inter-City trains to stop.

Air

Luton Airport is approximately 22 miles south-west of the town, which offers frequent

fl ights to many domestic and international locations. London Heathrow, London Gatwick

and Birmingham International Airports are also within easy reach of the town.

Edinburgh

Newcastle

Glasgow

Leeds

Manchester

Birmingham

M1

London

East Midlands

Luton Stansted

HeathrowCity

Gatwick

Milton Keynes


A5

A5

MILTON KEYNES CENTRAL

A422

A422

A509

A509

B4034

MARLBOROUGH STREET

B4034

S

TANDIN

G WAY

S

TANDING WAY

A421

A421

A4146

M1

14

MILTON KEYNES

TOWNCENTRE

TO M1 (JUNCTION 15),M45, M6, COVENTRY &BIRMINGHAM

TO M1 (JUNCTION 9),LUTON & LONDON

TO LUTON& LONDON

TO NORTHAMPTON& THE NORTH

MONKS WAY

MONKS WAY

PORTWAY

PORTWAY

TONGWELL STREET

LINFORD WOOD BUSINESS PARK

SITUATION

Linford Wood is an established offi ce campus location in Milton Keynes situated approximately one mile north of the town centre and three miles

west of the M1 (junction 14) via the A422 dual carriageway. Regular buses run from Linford Wood to a wide range of key destinations including Milton

Keynes Central railway station and the town centre.

The area has attracted a number of companies with their regional headquarters including Motor Insurer’s Bureau, Computacenter and Hays Distribution

Services.

Sat Nav reference MK14 6NJ.


DESCRIPTION

Linford Wood Business Centre was constructed between 1984 and 1990 and comprises fi ve self-contained buildings with a total fl oor area of

(10,993 m2) 118,330 ft2. The buildings are arranged around a central car park on an attractive, landscaped campus with a total site area of approximately

3.4 hectares (8.4 acres). The buildings offer the fl exibility to be let as a whole, on a fl oor by fl oor basis or in smaller suites such that they can service

a wide range of occupational requirements.

Internally, the general specifi cation includes:

• Raised fl oors • 4 pipe fan coil air conditioning

• Suspended ceilings with recessed lighting • Male, female and disabled WC’s

Much of the accommodation has recently been refurbished including the following areas:

• Carina - Part ground and fi rst fl oors

• Cygnus - The whole building

• Gemini - Part ground and part fi rst fl oors

• Scorpio - The whole building

Externally, there are 445 car parking spaces providing an overall car parking ratio 1:26 m2 (1:266 ft2).


SPECIFICATION

3A 3B

3C & 3D

3E, 3F, 3G & 3H

CARINA CYGNUS

Ground Floor First Floor Ground Floor First Floor

GEMINI

Ground Floor

2C & 2D

2A 2B

First Floor

2C & 2D

2A 2B

Ground Floor First Floor

LIBRA

SCORPIO

Ground Floor First Floor

For illustrative purposes only

Fully Refurbished

Moderately Refurbished

Requires Refurbishment


TENURE

The property is held freehold.

CARINA

LIBRA

SCORPIO

CYGNUS

GEMINI

Unit TenantAccommodation Lease Details Current Income

CommentsFloor ft2 Start End Review Break £ pa £ per ft2

Carina

3A Vacant Ground 1,827 - - - - - -

3B Vacant Ground 3,409 - - - - - - Unit became vacant on 29/09/2011.

3C & 3D Mirus IT Solutions Ltd Ground 6,219 13/04/2011 12/04/2016 - 13/04/2014 £52,275 £8.41Tenant only break option requiring 6 months written

notice. 22 demised car parking spaces.

3F, 3E, 3G

& 3HVacant First 11,807 - - - - - -

Total 23,262 £52,275

Cygnus

WholeRenesas Electronics

(Europe) GmbH

Ground 11,06201/06/2011 24/03/2015 - - £231,570 £10.17

12 months rent free. The vendor will top up the rent free

period. 85 demised car parking spaces.First 11,705

Total 22,767 £231,570

Gemini

2A VacantGround 2,405

- - - - - -First 2,748

2B SMA Solar UK LtdGround 2,609

19/07/2011 18/07/2016 19/07/2014 19/07/2014 £51,417 £9.23 20 demised car parking spaces.First 2,962

2C & 2D Vacant

Ground

First

5,693

5,671- - - - - -

Total 22,088 £51,417

Libra

WholeBritish

Telecommunications Plc

Ground

First

11,438

11,34424/06/1988 23/06/2013 - - £276,000 £12.51

Tenant not in occupation. 80 demised car parking

spaces.

Total 22,782 £276,000

Scorpio

Whole IMServ Europe Ltd

Ground

First

13,650

13,781

21/04/2007 20/04/2017 - - £276,130 £10.07

2012 break option has been removed by negotiation.

Rent free period from 24/06/2011 until 23/06/2012.

The vendor will top up the rent. 100 demised car

parking spaces.

Total 27,431 £276,130

Miscellaneous

SubstationEast Midlands Electricty

BoardGround - 24/06/1989 23/06/2014 - - £0 -

SubstationEast Midlands Electricity

BoardFirst - 08/02/1983 07/02/2004 - - £5 -

Currently holding over. Terms agreed with Central

Networks. 21 year FRI lease at a peppercorn

(£50 commuted sum from 24/09/2011).

Wayleave

(UG Cable)

Western Power Distribution

(East Midlands) plcSecond - 15/05/2007 14/05/2032 - - £2 -

Total - £7

118,330 £887,399


TENANCY SCHEDULE

The property is currently let to 5 tenants in accordance with the tenancy schedule set out below and produces a rental income of £887,399 per annum

which equates to a low overall base rent of only (£113 per m2) £10.47 per ft2.

The property has been measured by Plowan Craven on a net internal basis in accordance with the Code of Measuring Practice (6th edition).


COVENANT INFORMATION

British Telecommunications Plc – 31% of the income

BT are one of the largest telecommunications service companies in the world which has operations in more than 170 countries. Further information

can be found at www.bt.com.

Date 31/03/2011 31/03/2010 31/03/2009

Sales Turnover £20,076,000,000 £20,859,000,000 £21,313,000,000

Profi t / (Loss) Before Taxes £1,959,000,000 £1,303,000,000 £826,000,000

Tangible Net Worth £17,724,000,000 £12,129,000,000 £14,346,000,000

Net Current Assets (Liabilities) (£1,925,000,000) (£3,616,000,000) (£3,264,000,000)

D&B rating of 5A1

IMServ Europe Ltd – 31% of the income

IMServ was founded in 1992 and today are one of the UK’s leading providers of carbon and energy solutions. They have over 50% of the energy data

collection market and collect over 80 billion units of electricity consumption data annually. Further information can be found at www.imserv.com.

Date 31/03/2011 31/03/2010 31/03/2009

Sales Turnover £29,633,000 £25,351,000 £23,678,000

Profi t / (Loss) Before Taxes £1,559,000 £5,059,000 £6,291,000

Tangible Net Worth £21,790,000 £20,293,000 £15,236,000

Net Current Assets (Liabilities) £21,340,000 £19,729,000 £14,345,000

D&B rating of 4A1


Renesas Electronics (Europe) GmbH – 26% of the income

Renesas Electronics Europe is a wholly owned subsidiary of Renesas Electronics Corporation (TSE: 6723), the world’s leading supplier of microcontrollers

and a premier supplier of advanced semiconductor solutions. There are four dedicated business groups serving the region’s key markets: automotive,

communications & consumer, industrial and mobile platforms. Further information can be found at www.renesas.eu.

Date 31/03/2010 30/09/2009 31/03/2008

Net Sales or Gross Results €522,373,000 €558,593,000 €636,089,000

Balance Sheet Total €239,708,000 €187,572,000 €240,122,000

Current Assets €231,190,000 €177,988,000 €230,522,000

D&B rating of 5A1

Mirus IT Solutions Ltd – 6% of the income

A computer services company providing IT support in Milton Keynes, Northampton and surrounding areas. Their services include consultancy, disaster

recovery planning, software licensing, wireless security and support services. Further information can be found at www.mirus-it.co.uk.

Date 31/10/2010 31/10/2009 31/10/2008

Tangible Net Worth £342,136 £323,264 £337,073

Net Current Assets (Liabilities) £389,898 £296,600 £351,898

D&B rating of B1


SMA Solar UK Ltd – 6% of the income

SMA develops and manufactures the industry’s most effi cient inverters for photovoltaic systems of any size, power class and grid specifi cation. Due

to the organisation becoming incorporated in November 2010, the fi rst set of accounts is not due to be fi eld until August 2012.

SERVICE CHARGE

Occupiers pay a service charge for the upkeep and maintenance of the estate common areas. Based on the total budget for the year ending

31 December 2011, the overall charge equated to £1.83 per ft2. The budget for the year ending 31 December 2012 is in the process of being fi nalised.

CAPITAL ALLOWANCES

Capital Allowances may be available by way of separate negotiation.


VAT

The property is elected for VAT however it is anticipated that the sale will be treated as a Transfer of a Going Concern (TOGC).

INVESTMENT CONSIDERATIONS

• The buildings offer the fl exibility to be let as a whole, on a fl oor by fl oor basis or in smaller suites.

• The property can service a wide range of occupational requirement sizes.

• Much of the accommodation has recently been refurbished reducing the need for future capital expenditure.

• Large site area of approximately 3.4 hectares (8.4 acres).

• Recent lettings in Carina and Gemini demonstrates occupational demand.

• Opportunity to enhance and extend the income profi le.

• Let the vacant units to improve the running yield.

PROPOSAL

Offers are sought in the region of £7,000,000 (Seven Million Pounds), subject

to contract and exclusive of VAT.

A purchase at this level refl ects an attractive net initial yield of 12% assuming

purchaser’s costs of 5.8% and a low capital value of only £59 per ft2.

The yield improves to 16.5% on letting the vacant units.

CONTACTS

Noel Lander Simon Verrall Claire Mills020 7087 5336 020 7087 5393 020 7399 5747

07931 371 825 07815 940 656 07889 706577

[email protected] [email protected] [email protected]

© Crown Copyright 2011. All rights reserved. Promap licence number 100020449. Jones Lang LaSalle licence

number 100017659.

This plan is published for the convenience of identifi cation only and although believed to be correct is not

guaranteed and it does not form any part of any contract.

Misrepresentations Act 1967 & Declaration

Jones Lang LaSalle for themselves and for the vendors of this property whose agents they are give notice that: a)

the particulars are set out as general outline only for the guidance of intending purchasers and do not constitute,

nor constitute part of, an offer or contract; b) 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 purchaser should not rely on them as statements or representations of fact but should satisfy

themselves by inspection or otherwise as to the correctness of each of them; c) no person in the employment

of Jones Lang LaSalle has any authority to make or give any representation or warranty whatever in relation to

this property.

Subject to Contract • Exclusive of VAT • February 2012

linford wood business centredocs.novaloca.com/48_jll28087_634951181620478776.pdf · 2013-02-04 ·...

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