first - joiner cummings · point first point, buckingham gate gatwick airport, gatwick, rh6 0pp...

POINT First Point, Buckingham Gate Gatwick Airport, Gatwick, RH6 0PP

FIRST PRIME SOUTH EAST REFURBISHED MULTI LET OFFICE INVESTMENT

First Point , Buckingham Gate ,Gatwick Airport , Gatwick, RH6 0PP

INVESTMENT SUMMARY

Prime South East refurbished multi let office investment

» Prime South East multi-let office investment located adjacent to Gatwick Airport, within walking distance of the terminal buildings.

» Highly specified Grade A building totalling 62,028 sq ft which has recently been significantly refurbished at a cost of £3.1m.

» Excellent proximity to Gatwick Airport, the M23 and M25 motorways and access via train to central London within 30 minutes.

» 92% let to 5 tenants on 6 leases providing and attractive WAULT of 7.2 years to expiry 4.2 years to break.

» Currently producing £1,423,451 per annum reflecting an average rent on let space of £22.55 psf. Latest deals reflect up to £24.60 psf with £26.00 psf being promoted on the vacant element.

» Strong tenant profile from a good balance of airport related users and large corporates. Major tenants include HSBC, Close Asset Management, Norwegian and Amadeus.

» Outstanding parking provision of 270 spaces reflecting a ratio of 1:230 sq ft.

» Freehold.

» Offers are sought in excess of £17,210,000 (seventeen million two hundred and ten thousand pounds) subject to contract and exclusive of VAT reflecting a net initial yield of 7.75% assuming standard purchasers costs.

First Point , Buckingham Gate, Gatwick Airport , Gatwick, RH6 0PPPrime South East refurbished multi let office investment

ROYALTUNBRIDGE

WELLS

CROYDON

GUILDFORD

HASTINGS

CRAWLEY

WOKING

EASTBOURNE

BROMLEY

EPSOM

DORKING

GATWICK

HASTINGS

LONDON

EASTBOURNE

FARNHAM

HORSHAM

A24

A26

A26

A27A27

A3

A3A24

A23A21

A21

A229

A2

A31

A272

A272A273

M25

M25

M25

M3

M23

M20M2

M26

M414

12

109

7 6

9

5

FIR

STPO

INT

LOCATION/SITUATIONFirst Point is located within immediate proximity to Gatwick Airport within the eastern perimeter of the airport boundary, and adjacent to junction 9A of the M23 motorway. The main terminal building is within a few minutes walk.

The property is highly accessible by road serviced by the M23 motorway, and by rail serviced by mainline Gatwick Express and Southern Services to the Airport. The highways authority has recently announced up to £211 million in funding to transform the M23 motorway into a “smart motorway” between Junctions 10 (East Grinstead and Crawley) and 8 (M25). As part of the investment the M23 is set to become a four lane motorway in both directions. The M23 Smart Motorway scheme is already committed for completion by 2020, increasing capacity by around 30%.

Gatwick benefits from fast, efficient and frequent connections to central London. Gatwick Express services run nonstop between London Victoria and Gatwick Airport every 15 minutes with a journey time of 30 minutes. Southern services are also frequent to London Victoria (30 minutes) via East Croydon (14 minutes) and Clapham Junction (24 minutes) and London Bridge (31 minutes).

FIRST POINT IS LOCATED WITHIN A FEW MINUTES WALK OF GATWICK TERMINAL BUILDING

ROADCentral London 28 milesM23/M25 interchange 8.5 milesHeathrow Airport 38 miles

RAILLondon Victoria (Gatwick Express) 30 minutesLondon Bridge 31 minutesEast Croydon 14 minutes

PERIMETER RD EAST

BUCKINGHAM GATE

RING

RD

SOUT

H

BUCKINGHAM GATE

LOWER FORECOURT

R I NG RD SOUTH

RING RD SOUTH

EASTWAY

WESTW

AY

A23 LONDON ROAD

AIRPORT WAY AIRPORT WAY

B203

6

B203

6

UPPER FORECOURT RING R D N O R T H

HILTONLONDONGATWICKAIRPORT

SOUTHTERMINALCOACHSTATION

M23

GATWICKSTATION

GATWICKAIRPORT SOUTHTERMINAL

9A

TO J9

FIR

STPO

INT


TEN REASONS TO INVEST IN CRAWLEY/GATWICK

» Located right by UK’s second largest international airport, London Gatwick Airport.

» Quick access to London, 30 minutes direct by train every 10-15 minutes.

» Easy access to the national road network, connected by the M23 and 10 minutes to the M25.

» Access to Heathrow Airport, 45 minutes via M23 and M25.

» Strong sector presence and home to numerous global blue-chip companies and headquarters.

» Independent research studies have confirmed the area as a first class location for business.

» Manor Royal Business District, the biggest business park in the South East.

» Prime property availability and development opportunities offer excellent growth prospects.

» Access to talent, a skilled and educated workforce.

» A vibrant and active local business community.


DESCRIPTIONFirst Point was developed in 1997 and forms a well configured office building totalling 62,028 sq ft over ground and 3 upper floors on a large 1.45 hectare (3.58 acre) site. The floor plates are well configured, around a central atrium/ light well and offer excellent flexibility with numerous options for divisibility.

The ground, first, part second, part third floors alongside the common areas have recently benefited from a substantial refurbishment costing in excess of £3,100,000 and now provide newly refurbished Grade A office specification as follows:» Refurbished entrance reception area» Full height glazed atrium» 2 x 13 person passenger lifts (recently refurbished)» Male and female WC’s on each floor » Disabled WC facilities on 1st and 3rd floors» Shower facilities on 2nd floor» New under floor AET Hiross air conditioning system and chillers» New fire alarm system» Full access raised floors» LED energy efficient lighting with metal suspended ceilings

A total of 270 car parking spaces are provided offering an excellent ratio of 1:230 sq ft, with demised parking at the front and visitor parking at the rear.

RECENTLY REFURBISHED TO A GRADE A SPECIFICATION AT A COST OF £3.1M


ACCOMMODATIONThe property has been measured in accordance with the RICS Code of Measuring Practice (6th Edition) and provides the following net internal areas:

FLOOR USE SQ M SQ FT

Ground Reception/Atrium

Ground Office 1,426.1 15,350

First Office 1,424.9 15,337

Second Office 1,418.3 15,266

Third Office 1,493.4 16,075

TOTAL 5,762.7 62,028

GROUND FLOOR NORWEGIAN

WC WCWC

FIRST FLOOR

WC WCWC

HSBC VACANT

WC WCSHOWER

SECOND FLOOR

CLOSE ASSETMANAGEMENT

FASTJET

WC WCSHOWER

THIRD FLOOR

AMADEUS U/OTO AMADEUS

PLANNINGThe vendor where necessary has achieved a release of the Airport related user clause on the building.

Further information is available on request.

EXCELLENT FLEXIBILITY OF ACCOMMODATION AROUND CENTRAL ATRIUM OFFERING POTENTIAL TO SUB DIVIDE OR LET AS A WHOLE

58.2m

LINKWAY

BUCKINGHAM GATE

Drai

n

Gantry

RO

ADR

ING

SO

UTH

First Point

El Sub Sta

0m 10m 20m 30m

TENUREThe property is held freehold. A copy of the registered title is available on request. The site area totals 1.45 ha/3.6 acres.

For indication purposes only


TENANCIESFirst point is 92% let to 5 tenants with an attractive WAULT of 7.2 years to expiry/4.2 years to break.

Floor TenantArea Sq Ft

Car Spaces

Rent £ pa

Rent £ psf

% Rent

Lease Start

Lease Break

(Notice)Lease Expiry

Next RR Comments

Ground Norwegian Air UK Limited

15,350 57 £377,472 £24.59 27% 19/04/2016 19/04/2021(12 months)

18/04/2026 19/04/2021 Vendor to top up 9 months initial rent free. 3 months rent free if tenant does not exercise break.

1st (part) HSBC Bank PLC 8,132 33 £199,711 £24.56 14% 24/06/2016 23/06/2021(6 months)

23/06/2026 24/06/2021 Vendor to top up 12 months rent free + further 241 days rent free in respect of the capital contribution. 3 months rent free if tenant does not exercise break. Service charge cap £44,181.13 + RPI no shortfall.

1st (part) Rental Guarantee 7,205 – £187,330 £26.00 13% – – – – The vendor will provide a rent, rates and service charge guarantee for a period of up to 24 months or until this element becomes income producing.

2nd (part) Close Asset Management Ltd

12,008 51 £265,320 £22.10 19% 20/11/2015 20/11/2020(6 months)

2nd (part) Fastjet Plc 3,258 13 £71,573 £21.97 5% 31/08/2012 – 30/08/2017 – Outside Act.

3rd Amadeus Marketing (UK) Ltd

11,105 48 £212,705 £19.15 15% 14/03/2013 – 22/05/2023 14/03/2018 SC cap £81,163.75 + RPI no shortfall.

3rd Under offer to Amadeus Marketing (UK) Ltd

4,970 20 £109,340 £22.00 8% TBC – 22/05/2023 14/03/2018 Under offer. Vendor to top up the initial 12 months rent free. Service charge cap TBC but no shortfall.

TOTAL 62,028 £1,423,451


19/11/2025 20/11/2020 Vendor to top up 12 months rent free. SC cap £65,365.20 + RPI no shortfall. 3m months rent free if tenant does not exercise break. The landlord is to procure an extension of the temporary planning consent prior to 6/8/2024. If this is not achieved the tenant may break on 6/8/2025 on 6 months notice.

MARKET COMMENTARYCrawley and Gatwick have a current built total office stock of approximately 4.8 million sq ft. As of Q2 2016 current office supply is reported at 405,000 sq ft with a vacancy rate of 9.8%, which is lower than the South East average vacancy of approximately 10%.

In terms of comparable supply in the vicinity, the focus for larger office developments is concentrated out of town, primarily at Manor Royal, where a number of former industrial sites have been redeveloped to office uses.

2015 saw annual demand levels reach a new peak for the market following good take up in the smaller size bands alongside the agreement of two exceptional deals. In Q2 2015, Virgin Atlantic agreed to let the entirety of the Leonardo Building in the Crawley Business District, which started speculatively in 2014. The terms reflected £23.00 psf with 18 months’ rent free over the 16.5 year lease. The move sees the firm relocate out of their existing, slightly larger HQ on an adjacent site. Alongside this, Q4 saw Swedish human care firm Elekta agreed terms for an 110,000 sq ft pre-let at Manor Royal, constituting the first phase of a new headquarters for the firm. The Elekta deal reflected £23.95 psf. The year also saw the Grade A St John’s House receive its first occupier interest with BroadSoft agreeing terms for the first floor. The 30,200 sq ft building was refurbished in 2012.

CRAWLEY AND GATWICK ARE HOME TO NUMEROUS BLUE CHIP COMPANIES INCLUDING THALES, VIRGIN, EDF, NESTLÉ AND ELEKTA

DATE BUILDING TENANT RENT £ PSF

AREA SQ FT

Q3 16 First Point, Buckingham Gate HSBC £24.50 8,150 sq ft

Q2 16 First Point, Buckingham Gate Norwegian Air £24.50 15,400 sq ft

Q4 15 Ph1, Manor Royal Elekta £23.95 110,000 sq ft

Q2 15 Leonardo Building, Crawley BP Virgin £23.00 110,000 sq ft

Q1 15 City Place, Gatwick Nespresso £24.50 8,600 sq ft


31/07/2015 31/07/2014 31/07/2013

Turnover £84,373,000 £79,138,000 £60,152,000

Pre-tax Profit £14,971,000 £11,378,000 £6,443,000

Net Worth £26,668,000 £22,991,000 £14,042,000

31/12/2015 31/12/2014 31/12/2013

Turnover £48,106,929 £40,998,299 £16,938,193

Pre-tax Loss -£30,288,398 -£42,757,524 -£21,033,141

Net Worth £17,297,937 -£12,254,677 £2,219,340

TENANT FINANCIAL INFORMATION

Close Asset Management Ltd (19% of total income)Close Asset Management Ltd is a wholly owned subsidiary of Close Brothers Group Plc and operates as part of CBG’s Asset Management division. The company’s principal activity is the provision of financial advice, investment management, and self-directed services to private clients and small institutions.

We detail below a snapshot of the latest financial figures for Close Asset Management Ltd.

Fastjet PLC (5% of total income)Fastjet are Africa’s first pan-continental airline. Since launching in 2012, they have flown nearly 2,000,000 passengers with customers benefiting from fares as low as $10 one way. Fastjet currently operate three aircraft from their Tanzania base with plans to growth to a fleet of thirty four aircraft by 2018 operating from bases across the region. In April 2015 Fastjet raised £50m in equity funding by way of a share issue.

We detail below a snapshot of the latest financial figures for Fastjet PLC.


Amadeus Marketing (UK) Ltd (23% of total income)

Amadeus was created in 1987 as an independent and neutral global distribution system (GDS). Iberia, Air France, Lufthansa and SAS needed to connect with travel agents in real-time to make airline booking quick and convenient all over the world.

In 2013 their GDS facilitated more than half a billion travel agency bookings and processed 1.6 billion transactions every day. The company is a wholly owned subsidiary of Amadeus IT Group S.A incorporated in Spain.

We detail below a snapshot of the latest financial figures for Amadeus Marketing (UK) Ltd.

HSBC Bank Plc (14% of total income)HSBC Bank plc is one of the largest banking and financial services organisations in the world. HSBC’s international network comprises around 7,500 offices in over 80 countries and territories in Europe, the Asia-Pacific region, the Americas, the Middle East and Africa.

HSBC Bank plc is one of the four major clearing banks in the United Kingdom and is a wholly owned subsidiary of HSBC Holdings. The business ranges from the traditional High Street roles of personal finance and commercial banking, to private banking, consumer finance as well as corporate and investment banking. Across all brands the bank operates some 1800 sites in the UK.

We detail below a snapshot of the latest financial figures for HSBC Bank plc.

31/12/2015 31/12/2014 31/12/2013

Turnover £18,630,000,000 £18,313,000,000 £20,302,000,000

Pre-tax Profit £2,971,000,000 £1,953,000,000 £3,294,000,000

Net Worth £30,486,000,000 £28,784,000,000 £24,436,000,000

31/12/2015 31/12/2014 31/12/2013

Turnover £30,616,491 £52,701,531 £48,809,549

Pre-tax Profit £1,027,121 £1,773,172 £1,716,147

Net Worth £2,045,765 £7,065,283 £5,574,404


Norwegian Air UK Limited (27% of total income)Norwegian Air International is an Irish airline owned by Norwegian Air Shuttle, flying scheduled services within Europe and North America.

The airline operates Boeing 737-800 aircraft with bases at London Gatwick (LGW) in the United Kingdom, Helsinki (HEL) in Finland, Barcelona El Prat (BCN), Las Palmas (LPA), Madrid (MAD), Tenerife South (TFS), Alicante (ALC), Málaga (AGP) and Palma de Mallorca (PMI) in Spain. as well as Rome Fiumicino (FCO) in Italy. Its registration within Ireland and outside Norway allows the company to take advantage of European Union airline freedoms and agreements.

There are no reported accounts for Norwegian Air UK Ltd since its incorporation in 2015. Norwegian Air Shuttle own 100% of Norwegian Air UK Ltd who have a market capitalisation of approximately 10bn NOK and employ over 4,500 people.


FURTHER INFORMATIONPeter Flanders [email protected]

John Blackwell [email protected]

Simon Martin [email protected]

Telephone: 020 7409 7828 Fax: 020 7491 9121

VATThe property is elected for VAT and it’s anticipated the transaction will be treated as a TOGC.

CAPITAL ALLOWANCESThe vendor is to retain the benefit of all capital allowances on this transaction.

EPCThe property has an EPC rating of C73.

Full information is available on request.

PROPOSALOur client is seeing offers in excess of £17,210,000 (seventeen million two hundred and ten thousand pounds), subject to contract and exclusive of VAT. A purchase at this level will provide an attractive net initial yield of 7.75% after standard purchaser’s costs.

INVESTMENT CONSIDERATIONS» Located right by UK’s second largest

international airport, London Gatwick Airport.

» Excellent accessibility to M23 and M25.

» Access to central London by train within 30 minutes.

» Comprehensively refurbished building.

» Exceptional flexibility given configuration of floor plates around central atrium.

» Strong tenant occupier profile.

» Crawley/Gatwick has a strong sector presence and home to numerous global blue-chip companies and headquarters.

» Re-based rental base of £22.55 psf with strong growth potential given lack of good quality space in the vicinity.

» Attractive yield profile.

Disclaimer Notice Messrs Joiner Cummings for themselves and (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. The date of this publication is November 2016.

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first - joiner cummings · point first point, buckingham gate gatwick airport, gatwick, rh6 0pp...

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