Investment OppOrtunIty

Avon Rubber PlcHampton Park West, Melksham, Wiltshire SN12 6NB

Global Headquarter Warehouse Facility – Fully Let to Avon Rubber Plc

• Offers sought in excess of £11,400,000 (ElevenMillion, Four Hundred Thousand Pounds)reflecting an attractive net initial yield of 6.75%after allowing for purchaser’s costs of 5.80%.this represents a capital value per sq ft of£66.79.

Proposal

• the avon rubber Global Headquartersmanufacturing and warehouse facility located inmelksham.

• a high quality HQ warehouse building purposebuilt for avon rubber plc in 1999 measuringapproximately 170,680 sq ft (GIa).

• site area of 10.87 acres with a low site density of29%.

• Fully let to avon rubber plc on a lease expiring21st august 2030.

• unexpired term of approximately 15 years.

• Current passing rent of £813,700 pa equating to£4.77 per sq ft.

• Freehold.

Description Tenure & Tenancy

Investment summary

M49

M32

M4

A346

M4

A322

M4

M3

M25

A40

A406

A41

M

A

A3

A316

A3A331

A

A339A34

A338

A361

A36

A37

A46 A4

A350A4

A46A429

A33

18

22 21

15 20

19 1817

15

13

MELKSHAM

SWINDONSWINDON

BRISTOLBRISTOL

BATHBATH

CHIPPENHAMCHIPPENHAMNEWBURYNEWBURY

FROMEFROME

FARNBOROUGHFARNBOROUGH

MARLBOROUGHMARLBOROUGH

READINGREADING

LONDONLONDON

BRACKNELLBRACKNELL

Locationmelksham is a town located in Wiltshire,approximately 20 km (12.5 miles) east of Bath, 12 km (7.5 miles) south of Chippenham and 10.5 km (6.5 miles) north of trowbridge. Bristollies 42 km (26 miles) to the north-west andswindon is 46 km (28 miles) to the north-east.

adjacent units include Great Bear Distribution, G-plan, easyspace, aL King roofing and a newHerman miller facility. Further local occupiersinclude Wiltshire Constabulary, WestinghouseBrakes and travis perkins.

Situationthe subject property is situated on Hampton parkWest, a recently developed commercial areawithin melksham, opposite the Hampton park eastindustrial area. the property fronts the a350 andis accessed directly from the Hampton parkroundabout.

adjacent to the subject property, Herman millerhas developed a new distribution centre ofapproximately 185,000 sq ft. the redevelopmentof the site will include the extension of portalroad, which will link the Bowerhill Industrial estateto the a350 to Hampton park West.

Other nearby occupiers include G-plan (95,057 sqft) and Great Bear who operate a 150,000 sq ftdistribution facility for Cereal partners (nestlé andGeneral mills) opposite the subject property.adjacent to the property is the ashville Centre,comprising small industrial/trade counter units.

Communicationthe m4 motorway is easily accessed via Junction17, approximately 19.5 km (12 miles) to the northvia the a350. the m4 leads directly to the m5, 34 km (21 miles) and the m25, 125.5 km (78 miles).

melksham railway station links to the nearbyChippenham railway station which is on the maineast-west rail line between London and Bristol.

the train from London to Chippenham takes just54 minutes, and Chippenham to melksham only 24 minutes. Bristol International airport liesapproximately 53 km (33 miles) to the west andHeathrow 150 km (93 miles) to the east.

CHIPPENHAMCHIPPENHAM

FROMEFROME

M4

M32

A46

A420

A4

A37

A33

A361

A350

A350

A429

A4

A4174

M

A3102

A365

A365

ST ED

ITH

’S MA

RSH

A361

A3

63

B3908

A362

A36

A361

A350

B3107

17

181

19

16

15

20

BATHBATH

LOCatIOn

SHAILS LANE

HAMPTON PARK WEST

PORTAL ROAD

LA

NC

AS

TE

R R

OA

D

HA

LIFA

X R

OA

D

HERCULES WAY

SWIFT WAY

AVRO WAY

SE

MIN

GT

ON

RO

AD

A350

AVON

G P

LAN

MAPSWORLDWIDE

WE BUY ANY CAR

POLICE

HE

RM

AN

MIL

LE

R

Avon Rubber Plc

sItuatIOn

12 13 14 15

Cooper-AvonTyres Ltd

Ashville Centre

Christie-MillerSports Centre

Herman Miller

Cooper-AvonTyres Ltd

The Milk ChurnCountry Pub

Travis Perkins

NewConnectingRoad

Great BearDistributionLtd

Knorr-Bremse

GompelsHealthcare Ltd

Evans BusinessCentre

G-PlanUpholstery

A L KingRoofing

MelkshamPolice Station

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

M4

A350

HA

MPT

ON

PA

RK W

EST

SEMINGTON ROAD

PORTAL RO

AD

1110987654321

Avon operate a 24/7 manufacturingoperation withapproximately 240 staff employedon site

Low site coverage of 29%

DesCrIptIOn

the subject property comprises a modernpurpose built facility constructed for avonrubber plc in 1999. the warehouse is ofsteel frame construction with a minimumeaves height to haunch of 10 metres andintegral offices to the front and rear of theproperty, with metal clad elevations and aconvex roof.

the building provides four dock levelloading doors, a single level access loadingdoor (all under a canopy) and two additionalsingle level loading doors (not covered). the warehouse area is mechanicallyventilated and has a full sprinkler system.

the office accommodation extends over twostoreys to the front of the warehouse andadditional first floor area to the rear. theoffices benefit from an air conditioningsystem, suspended ceilings with Cat IIlighting and raised floors with underfloortrunking. there are three lifts accessing theoffice area, including one disabled lift.

the site benefits from extensive staff andvisitor car parking and a large secure areawith perimeter fencing.

Sitethe property is situated on a site with an area of approximately 10.87 acres (4.39 hectares). the overall site coverageis approximately 29%.

aCCOmmODatIOn

the property has been measured in accordance with the rICs Code of measuring practice on a Gross Internal area basis as follows:

Tenancythe property was originally let to avon rubber plc from 22ndaugust 2006 on a lease expiring on 21st august 2021.

a reversionary lease has been signed which commences on 22ndaugust 2021, expiring 21st august 2030, at a rent of £813,700 perannum equating to £4.77 psf. this provides an unexpired term ofapproximately 15 years.

a deed of variation, signed 25th February 2015, alters the originallease to reduce the rent paid by the tenant between 22nd august2015 and 21st august 2018 to £248,630.56 per annum. the rentreturns to £813,700 per annum on 22nd august 2018. the vendorwill provide rental top-ups for this period.

rent reviews are every 5 years, with the next being on the 22ndaugust 2020.

the lease is on Full repairing and Insuring terms, with aphotographic schedule of condition from april 2006.

Tenurethe property is held Freehold.

15 years unexpired

total

15,857 sq m

(170,680 sq ft)

Dispatch

1,431 sq m

(15,407 sq ft)

m&e

1,319 sq m

(14,201 sq ft)

Offices

3,669 sq m

(39,489 sq ft)

main Warehouse

9,437 sq m

(101,583 sq ft)

tenant COvenants

avon rubber plc was established in Wiltshire in 1885, and hasgrown to become a leading global engineering group in thedevelopment and production of rubber products. avonrubber plc is listed on the London stock exchange and is aconstituent of the Ftse smallCap Index. avon rubber plc is asupplier to a range of automotive, engineering, dairy anddefence blue chip clients on a global scale. the company is atthe forefront of innovation in its advanced technologyproducts throughout these industries, employing over 4,500staff worldwide. In particular the company is expectingstrong growth in its protection and engineered productsBusiness, with customers including the us military and themoD in the uK.

the subject property is the tenant’s global HQ from whichthey operate avon Dairy solutions, avon rubbermanufacturing, avon protection and artis. avon rubber plcalso occupy a unit in Dorset within the uK where theyoperate avon protection underwater systems, as well asnumerous sites within the usa and malaysia.

avon rubber plc has recently expanded and increased itsshare in the dairy markets by purchasing an Italian companyInterpuls for £21m. the Italian manufacturer of specialistmilking components, including pulsators, milk meters andautomatic cluster removers, is likely to expand avon rubber’srange of dairy products.

Further information can be found at www.avon-rubber.com

avon rubber plc has an experian risk score of 100, whichrepresents a Very Low Risk company and has reported thefollowing results:

the tenant is a well-established company, as they arediversifying their product lines and winning new contracts.they hold significant contracts with the us military, nypD,moD and middle eastern clients, supplying gas masks andanti-sonar detection products. the tenant has investedheavily in the building and the specification is well abovecomparable units for its age and use.

Planningthe property benefits from use Classes B1, B2 and B8.

Sep 2014 (£) Sep 2013 (£) Sep 2012 (£)

turnover £124,779,000 £124,851,000 £106,636,000

pre-tax profit £16,554,000 £13,194,000 £11,005,000

net Worth £7,776,000 £4,155,000 £10,616,000

JP Morgan, BlackRock, Henderson and Schroder’s are all major shareholders in Avon Rubber Plc

address Date area sq ft

rent pa(psf)

unexpterm

price £Initialyield %

Comments

Bodyshop HQ, Watersmead Bp, Littlehampton aug-15 170,078£1,443,372(£8.49 psf)

11£19,750,000(£116 psf)

6.90% purchaser: Confidential (C&W sold)

Co-op, park Farm, Wellingborough aug-15 341,000£1,815,000(£5.32 psf)

12.3£29,200,000(£86 psf)

5.80% purchaser: royal London

mOOG, tewkesbury Jul-15 43,896£457,012(£10.41 psf)

20£7,450,000(£170 psf)

5.80% purchaser: Cordea savills

Great Bear, markham vale, Chesterfield Jul-15 480,000£2,280,000(£4.75 psf)

15£36,000,000(£75 psf)

6.25% purchaser: m&G

Hallite seals, Hampton, London Jun-15 85,317£782,000(£9.17 psf)

16£13,300,000(£156 psf)

5.56% purchaser: ecclesiastical Insurance

palmer & Harvey, Coventry Bp, Coventry Jun-15 210,828£1,479,000(£7.02 psf)

10£23,300,000(£111 psf)

6.10% purchaser: Im properties

the Co-op, andover Commercial park apr-15 517,371£3,705,630(£7.16 psf)

16.25£61,000,000(£118 psf)

5.74% purchaser: Blackstone

Clipper, swadlincote Feb-15 240,000£1,188,000(£4.95 psf)

10£16,760,000(£70 psf)

6.70% purchaser: Clipstone

Investment marKet

the industrial market continues to receive stronginvestor demand from a combination of uKinstitutions, foreign investors and propertycompanies. this demand, combined with a shortageof good quality stock, has resulted in continuedyield compression over the last 18 months, with aripple effect from London to the prime and goodsecondary regional locations as investors arelooking to up the risk curve. Outlined opposite are some relevant investment transactions.

Long unexpired Lease term of 15 years to a strong internationalcovenant

InvestmentRationale

the building serves as avon rubber’sglobal headquarters and is theprimary employer in the town

tenant is well entrenched, havingbeen at the site for more than 16 years and recently signed areversionary lease

attractive initial yield of 6.75%

rent of £4.77 psf offers scope forgrowth with nearby prime rents of£6 psf in Bristol and £5.50 psf inswindon

Good quality industrial building with a limited Grade a supply in southern uK

Low site coverage of 29% withexcellent potential for the tenant to expand or future redevelopment

EPC Ratingenergy performance Certificate: D 94.

VATWe understand the property has been elected for vat, whichwill therefore be chargeable on the sale price unless thetransaction can be treated as a transfer of a Going Concern(tOGC).

Web Accesswww.cushmanwakefieldinvestmentsales.co.uk/cw/melksham

prOpOsaL

Offers are sought in excess of £11,400,000(Eleven Million, Four Hundred ThousandPounds), subject to contract and exclusive ofVAT. A purchase at this price reflects a netinitial yield of 6.75%, assuming standard purchaser’s costs of 5.80%.

september 2015mIsrepresentatIOn aCt 1967 Cushman & Wakefield LLp (and their joint agents if appointed) for themselves and for vendors or lessors of this property whose agents they are, give notice that: (1) the particulars are produced ingood faith, are set out as a general guide only and do not constitute any part of a contract. (2) no person in the employment of the agent(s) has any authority to make or give any representation orwarranty whatever in relation to this property. (3) this property is offered subject to contract and, unless otherwise stated, all rents are quoted exclusive of vat. (4) nothing in these particulars shouldbe deemed to be a statement that the property is in good condition or that any services or facilities are in working order. (5) unless otherwise stated, no investigations have been made regardingpollution or potential land, air or water contamination. Interested parties are advised to carry out their own investigations if required.production by plusart 0115 972 4000

Richard Peacee: richard.peace@cushwake.comt: +44 (0) 20 7152 5283

Nicholas Dufeue: nick.dufeu@cushwake.comt: +44 (0) 20 7152 5230

Ben Sleathe: ben.sleath@cushwake.comt: +44 (0) 207 152 5366

Nick Allane: nick.allan@cushwake.comt: +44 (0) 117 910 5282

Cushman & Wakefield LLP43/45 portman squareLondon W1a 3BG

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