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PRIME WEST LONDON REVERSIONARY INDUSTRIAL INVESTMENT

INVESTMENT SUMMARY. e Prime West London industrial investment located 3 miles (5km) south of Heathrow Airport.

e Ashford has excellent connectivity to the M25, M3 and M4 motorways.

e Two well specified detached warehouse units extending to 51,192 sq ft (4,756 sq m).

e Total site area of 1.07 hectares (2.65 acres) offering a low site density of 44%.

e The units are let to Geodis Wilson UK Limited by way of two FRI leases expiring on 6 January 2020.

e Current passing rent of £550,000 pax reflecting a low average passing rent of £10.74 psf offering excellent rental growth prospects.

e ERV of £588,708 pax (£11.50 psf).

e Freehold.

e Short term asset management opportunities to capture imminent reversion.

e

e A purchase at this level reflects an attractive net initial yield of 5.75%, a reversionary yield based on our ERV of 6.18% and a capital value of £175 per sq ft, assuming purchasers costs of 6.68%.

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We are instructed to seek offers in excess of £8,950,000 (Eight Million, Nine Hundred and Fifty Thousand Pounds) subject to contract and exclusive of VAT.

LOCATION.Ashford is located in the London Borough of Spelthorne approximately 17 miles (27 km) west of Central London and 3 miles (5 km) south of Heathrow Airport. The town has a resident population of 27,382 (2011 Census).Ashford benefits from excellent communication links being situated 4 miles (6.5 km) east of junction 13 of the M25 motorway. The town is also 2 miles (3 km) west of junction 1 of the M3 motorway and 5 miles (8km) south of junction 3 of the M4 motorway.

Ashford railway station provides direct rail services to London Waterloo with a fastest journey time of approximately 38 minutes. The Heathrow Express service at terminal 4 offers direct services to London Paddington with a fastest journey time of 15 minutes.

The local economy is dominated by the close proximity of London Heathrow Airport. In 2015 the Airports Commission recommended the expansion of Heathrow with a third runway. Whilst the location of the new runway will not impact on the property its proposed construction is likely to have significant positive economic benefits to the town.

LONDON

Mitcham

Sutton

Coulsdon

Windsor

Epsom

Weybridge

Egham

Twickenham

RichmondHounslow

HEATHROWAIRPORT

Surbiton

Cobham

New Malden

SloughHayes

Southall

Walton-on-Thames

Woking

Chertsey

Leatherhead

M4M4M4

M3

M3

M25

M25

M25

M25

A3044

A3212

A3205

A312

A406

A501

A308

A214

A316

A308

A308

A307

A205

A243

A306

A240

A217

A217

A232

A240

A312

A40

A23

A30

A23

A24

A24

A23

A23

A4A4

A3

A3

A3

A3

HEATHROW AIRPORT

TH-WEST RD

A

304 4

SOUTHERN PERIMETE

13

12

1

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SITUATION.Action Court fronts directly on to the B378 Ashford Road which provides a direct link to the A308 Staines Road West approximately 0.5 miles (1.0 km) to the North West.

The A308 then provides direct access to junction 1 of the M3 motorway approximately 1 mile (2 km) to the east and junction 13 of the M25 approximately 4 miles (6 km) to the North West. The surrounding area is a mixture of commercial and residential uses.

A244

A244

A244

B377

STAI

NES

RO

AD

CH

ERTS

EY L

ANE

STAINES ROAD

BRIDGE ROAD

CHERTSEY ROAD

RENFREE WAY B375

FORDBRIDGE ROAD

HALLIFORD ROAD

GREEN STREET

VICARAGE ROAD

SNAKEY LANE

LITT

LETO

N LA

NE

B389

NORLANDS LANE

A244

A244

A244

B389

B388

A317

B376

B376

B376

NEW ROAD

CH

ARLT

ON

RO

AD

LeatherheadA23

A3

HEATHROW AIRPORT

A30 STAINES BYPASS

A308 STAINES BYPASS

A308 KINGSTON ROAD

A308

A30

LONDON ROAD

A30

A30

GREA

T SO

UTH-WEST RD

B376 WRAYSBURY RD

THE CAUSEWAY

THORPE ROAD

LALEHAM ROAD

KINGSTON ROAD

KINGSTON ROAD

ASHFO

RD ROAD

WO

RPLE R OAD

FORDBRIDGE ROAD

LONDON RD

CHERTSEY ROAD

FELTHAM HILL ROAD

FELTHAM R OAD

SCHOOL ROAD

CLO

CKH

OUS

E LA

NE

BEDFONT ROAD

STAINES ROAD

HATTON ROAD

STANWELL RD

B378 TO

WN

ROAD B378

STANWELL RD

CHURCH RD

A304

4

S

TAN

WEL

L M

OO

R RO

AD

A 304

4

BEDFONT ROAD

SOUTHERN PERIMETER ROAD

King

Geo

rge

IV R

eser

voir

Wra

ysbu

ry R

eser

voir

Staines Reservoir

Queen Mary Reservoir

Sunbury Golf Course

Bedford LakesCountry Park

M25

M25

M3

M3

M25

13

12

1

A422

THORPE

STAINES UPON THAMES

EGHAM HYTHE

ASHFORD

FELTHAM

LITTLETON

ASHFORD COMMON

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DESCRIPTION.The property comprises 2 detached warehouse buildings separated by a secure concrete surfaced loading yard. The units are of steel portal frame construction with profile metal clad elevations to the side and rear and glazed/red brick elevations to the front.The warehouse areas in each unit are arranged in an L shape configuration and have a minimum eaves height of 6.3m rising to 8.68m at the apex. The warehouse accommodation incorporates translucent rooflights, gas fired hot air blowers, 3 electrically operated loading doors and a canopied loading area.

Located to the front of the units are 2 storey amenity blocks which are fitted out to provide offices, WC’s and staff facilities. The offices are fitted out to include carpeting, suspended ceilings with recessed lighting, perimeter trunking and comfort cooling and double glazed window units.

The two units are divided by a concrete surfaced loading yard and there is an additional loading yard to the side of unit 1. To the front of both of the units there are brick paved parking areas.

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ACCOMMODATION.The property was measured in accordance with the RICS Code of Measuring Practice (6th Edition) and has the following gross internal floor area:

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LITTLETON COMMON

TENURE.Freehold.

Accommodation Area (sq m) Area (sq ft)

Unit 1 Action Court 2,366 25,468

Unit 2 Action Court 2,390 25,724

TOTAL 4,756 51,192

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TENANCY.Units 1 and 2 Action Court are let to Geodis Wilson UK Limited under two co-terminous full repairing and insuring leases expiring on 6 January 2020 providing an unexpired term of approximately 2 years and 3 months. The rent reserved under each lease is £275,000 pax providing a total passing rent of £550,000 pax which equates to £10.74 per sq ft overall. Both leases contain tenant only options to break on 7 January 2019 operable by the tenant providing a minimum of 6 months written notice.

In the event the tenant does exercise either option to break they receive a rent free period of 1 month.

Geodis Wilson UK Limited have vacated unit 2 Action Court and are in the process of subletting the ground floor offices and warehouse to VIP UK Trading Limited. The first floor offices of unit 2 have been sublet to Sims Recycling Limited. Further information on the two subleases are available upon request.

Unit Tenant GIA (sq ft) Lease Start Lease End Tenant Break Rent (pa) Rent (psf) ERV (pa) ERV (psf)

1 Action Court Geodis Wilson UK Limited 25,468 07/01/2015 06/01/2020 07/01/2019 £275,000 £10.80 £292,882 £11.50

2 Action Court Geodis Wilson UK Limited 25,724 07/01/2015 06/01/2020 07/01/2019 £275,000 £10.69 £295,826 £11.50

Total 51,192 £550,000 £10.74 £588,708 £11.50

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COVENANT.

Geodis Wilson UK Limited are part of SNCF Logistics, which in turn is a business line of the SNCF Group, who are the number one Transport and Logistics operator in France and ranked number four in Europe.

SNCF Logistics has a direct presence in 67 countries and a global network spanning 120 countries. The SNCF Group has an annual turnover of £15.155Bn and is ultimately owned by the French Government.

In the UK Geodis Wilson UK Limited have 21 offices and 2 warehouses. The company employs 709 staff in the UK and has five principle business lines namely Supply Chain Optimization, Freight Forwarding, Contract Logistics, Distribution and Road Transport. Further information on the company can be found at the website www.geodis.co.uk.

Geodis Wilson UK Limited (company registration number 0062154) last three years audited accounts are summarised below:

VIP UK Trading Limited (company number 10643594), is a Chinese based e-commerce company utilising the website www.vip.com. The company was founded in December 2008 and was listed on the New York Stock Exchange in March 2012. VIP are the third largest e-commerce site in China and have a current market capitalization of $5.35Bn (Source Reuters). VIP UK Trading Limited, was incorporated on 28.02.2017 and therefore no formal financial information is available.

Geodis Wilson UK Ltd 31/12/2016 31/12/2015 31/12/2014

Turnover £109,043,000 £85,423,000 £90,474,000

Pre-Tax Profit - £12,815,000 - £590,000 -£1,514,000

Net Worth -£55,889,000 - £1,413,000 -£4,063,000 Sims Recycling Limited 30/06/2016 30/06/2015 30/06/2014

Turnover £396,233,000 £585,500,000 £684,376,000

Pre-Tax Profit -£20,234,000 £12,505,000 -£68,365,000

Net Worth £119,825,000 £43,306,000 £32,736,000

Sims Group UK Limited (company number 03242331) are part of Sims Metal Management who are the world leaders in electronic and metal recycling. The company has an annual turnover in excess of £5Bn. The last 3 years audited accounts for the company are summarised below:

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The West London industrial market is the highest value industrial market in the UK and is characterised by strong tenant demand and a shortage of available buildings. The result of this imbalance has led to speculative development being undertaken, strong rental growth and a reduction in tenant incentive levels as occupiers compete for buildings.

INDUSTRIAL MARKET COMMENTARY.

Property Size (sq ft) Tenant Rent (psf) Date

Unit A Central Spaceway, Feltham 19,192 Satair UK £15.00 Oct-17

Unit 26 Ashford Industrial Estate, Ashford 4,366 M Capital Investments £11.68 Mar-17

Unit 19 Ashford Industrial Estate, Ashford 6,268 Vaughan Fabrication Services £12.60 Feb-17

Based on the above transactions we are of the opinion that the headline ERV for the property is £588,708 pax (£11.50 psf).

Prime headline rents in the area are in excess of £12.50 psf and rise to £15.00 psf in locations closer to Heathrow Airport. Rents on good secondary buildings are in excess of £11.25 psf. Detailed below is a schedule of recent occupational transactions:ASHFORD LONDON

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The UK industrial investment market and in particular the Greater London market continues to attract strong demand from the UK Institutions, overseas investors, private investors and Local Authorities.

Investors are attracted to the sector by the strong occupational market fundamentals and positive rental growth prospects. This has resulted in yield compression across the whole industrial sector. The table below details some recent comparable transactions:

INVESTMENT MARKET COMMENTARY.

Property Area (sq ft)

Tenancy Rent (pax) Price Net Initial Yield

Purchaser

12 Waxlow Road, Park Royal 42,889 Let to AFM Group Limited for a further 6 years.

£462,000 £12.50M 3.61% Available

401-409 Oldfield Lane, Greenford 38,367 Let to 4 tenants with an AWULT of 8.4 years to expiry.

£351,100 £7.30M 4.50% Available

Units 17-26 Ashford Industrial Estate, Shield Road, Ashford

62,010 Fully let to eight tenants with an AWULT of 8.5 years to expiries and 6.4 years to

breaks.

£666,259 £12.75M 4.85% Royal London Asset Management

(08/2017)

Trackside Business Centre, Brooklands, Byfleet

63,146 The property is fully let to 6 tenants with an AWULT of 5.23 years to expiry.

£500,814 £9.225M 5.09% Hermes REIM (04/2017)

Units 1 and 2 Vickers Drive, Weybridge

87,170 Let to John Lewis by way of a lease expiring on 8 March 2023.

£700,000 £13.81M 4.75% Elmbridge Borough Council

(11/2016)

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INVESTMENT CONSIDERATIONS. e Prime West London industrial investment.

e Strong occupational market fundamentals offering strong rental growth prospects.

e ERV of £588,708 pax (£11.50 psf) providing an attractive reversionary rent.

e Potential substantial dilapidations liability as Geodis Wilson Uk Ltd have been in occupation of both units for over 20 years on full repairing leases.

e Opportunity to agree an early surrender of the lease on unit 2 and agree a longer term lease with the subtenant, VIP UK Trading Limited at a higher rent.

e Refurbish and relet unit 1 at lease expiry at a higher rent to capture rental reversion.

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EPC.Units 1 and 2 Action Court both have EPC Ratings of D93. A copy of the EPC Certificate for both units is available upon request.

VAT.We understand the property has been elected for VAT and therefore anticipate the sale will be undertaken as a transfer of a going concern (TOGC).

PROPOSAL.We are instructed to seek offers in excess of £8,950,000 (Eight Million, Nine Hundred and Fifty Thousand Pounds) subject to contract and exclusive of VAT. A purchase at this level reflects a Net Initial Yield of 5.75% and based on our ERV a Reversionary Yield of 6.18% after deducting purchasers costs of 6.68%.

FOR FURTHER INFORMATION.For further information, or to arrange an inspection, please contact:

David Hawksley david.hawksley@joinercummings.co.uk 020 7409 7828

John Blackwell john.blackwell@joinercummings.co.uk 020 7409 7828

DISCLAIMER: Messrs Joiner Cummings (and their joint agents where applicable) for the vendors or lessors of this property whose agents they are give notice that:(i) The particulars are set out as a general outline for the guidance of the intending purchasers and do not constitute part of an offer or contract; (ii) All descriptions, dimension 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 are given without responsibility and any intending purchasers or tenant should not rely on them as statements or representations of fact but must satisfy themselves by inspection or otherwise as to the correctness of them; (iii) All plant, machinery, equipment, services and fixtures and fittings referred to in these particulars were present at the date of preparing these particulars, they have not however been tested and therefore we give absolutely no warranty as to their condition, operation or fitness for the purpose of an intending occupier or purchaser; (iv) No investigations have been undertaken by Joiner Cummings in respect of asbestos, issues concerning pollution and potential land, building, air or water contamination and any intending purchasers or tenant must satisfy themselves by inspection. (v) Unless otherwise stated, all prices rents and other charges are quoted exclusive of Value Added Tax (VAT) and any intending purchaser or tenant must satisfy themselves as to the incidence of VAT in respect of any transaction; (vi) No person in the employment of Joiner Cummings has any authority to make or give any representations or warranty whatever in relation to this property; (vii) No responsibility can be accepted for any expenses incurred by intending purchasers in inspecting properties, which have been sold, let or withdrawn. OCTOBER 2017

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