office/leisure investment with potential for...

FRIARY HOUSE, CARDIFF CF10 3AE

www.savills.com

OFFICE/LEISURE INVESTMENT WITH POTENTIAL FOR REFURBISHMENT OR CONVERSION

FRIARY HOUSE, GREYFRAIRS ROAD CARDIFF CF10 3AE

LOCATIONCardiff is the commercial capital and administrative centre for Wales, located approximately 45 miles west of Bristol and the Severn Bridge. The city is home to the Welsh Government.

Cardiff is one of Europe’s fastest growing capital cities. With historic importance as the world’s leading coal exporter, the city is now renowned as a cosmopolitan and progressive capital city. It also hosts one of the largest student markets outside of London with three established universities and approximately 50,000 full-time students.

Cardiff benefits from excellent road communications lying south of junctions 29-33 of the M4 motorway. The city provides an excellent rail service and easy access to the wider UK rail network. The fastest journey time to London Paddington is approximately 2 hours 5 minutes. Cardiff Airport is 30 minutes from the city centre which provides national and international flights.

INVESTMENT SUMMARYn Eight-storey office/leisure investment

n Circa 6,400 sq m (68,891 sq ft) of office and leisure accommodation

n The property is let on FRI lease terms to Admiral Insurance and Tiger Tiger with an annual passing rent of £709,740 per annum. There is

16 years remaining on the Tiger Tiger lease

n Vacant possession is available on the upper parts from November 2014

n Less than 150m from Cardiff’s prime retail street - Queen Street

n Excellent access to all of the city’s further education establishments

n Potential for refurbishment or conversion to a variety of uses (STP) including student accommodation, offices or residential

n Freehold

n Savills are instructed to seek offers in excess of £7,000,000 (Seven Million Pounds). This reflects a net initial yield of 9.50%, assuming

standard purchaser’s costs of 5.80%. This represents a capital value of only £102 per sq ft

FRIARY HOUSE

CARDIFF UNIVERSITY

Ordnance Survey © Crown Copyright 2014. All rights reserved. Licence number 100022432. Plotted Scale - 1:7500

SITUATIONFriary House is situated in a prominent position fronting Greyfriars Road in the centre of Cardiff. The Property is surrounded by a mixture of uses, including offices, hotels, residential and retail, and is less than 150m from Queen Street, Cardiff’s prime retail street.

Both Cardiff Central and Cardiff Queen Street railway stations are easily accessible from the property and offer direct trains to destinations across the UK. Bus stops immediately outside of the property serve direct routes to Cardiff Bus Station, Cardiff Castle and Newport.

The convenient city centre location of the property, combined with the excellent public transport links offered give superb access to all of the primary higher education institutions in Cardiff. Cardiff University’s Cathays campus (the University’s main campus) is only a short walk from the scheme. The University of South Wales’ Cardiff campus and Cardiff Metropolitan University’s Howard Gardens campus are also close by.

DESCRIPTIONFriary House comprises an eight-storey building arranged over basement, ground and 8 upper floors. The building provides a total area of circa 4,162 sq m (44,801 sq ft) NIA of office space and 2,238 sq m (24,090 sq ft) GIA of leisure space.

The building is of frame construction with a mixture of glazed curtain walling, render and glazed elevation incorporating steel framed windows. The building was part refurbished in c2004.

The basement, ground and first floor of the building and are occupied as restaurant/bar space and is occupied by Tiger Tiger. This space fronts onto Greyfriars Road and is accessed via the corner of Greyfriars Place.

The office space is arranged on 2nd-8th floors providing open plan accommodation with good natural light and served by two passenger lifts.

There are 8 car parking spaces and a loading area to the rear of the building off Crockherb Town Lane.

TENANCY SCHEDULE

Description Use & Tenant Unit Size Annual Rent Lease Start Lease Expiry

Basement, Ground Floor and 1st Floor

Leisure (A3D2 Limited t/a Tiger Tiger)

24,090 sq ft £337,500.00 18 October 2005 17 April 2030

2nd FloorOffices (EUI Limited)

9,685 sq ft £92,007.50 2 November 2011 1 November 2014

3rd FloorOffices(EUI Limited)


4th FloorOffices (EUI Limited)


Part 5th FloorOffices (EUI Limited)


Part 5th FloorOffices (EUI Limited)


6th FloorOffices (Vacant)

2,573 sq ft N/A N/A N/A





Totals 68,892 sq ft £684,910.50

TENANT PROFILEAdmiral also has a license on the property’s 8 car parking spaces. This license was issued on 30 April 2012 and will expire on 1 November 2014. The passing rent is £12,000 per annum. Admiral Insurance is the trading name of EUI Limited and are a FTSE 100 company.

Admiral principally operate as a car and home insurer, but also provide car warranty, alternative vehicle insurance, travel insurance, life insurance and pet insurance.

Tiger Tiger operate a popular restaurant/bar across the basement, ground floor and first floor of Friary House. Operating in 8 venues across the UK, Tiger Tiger is A3D2 Limited’s leading late night brand.

A3D2 is a wholly owned subsidiary of Novus Leisure, which in turn is the UK’s largest private bar and nightclub operator.

Room Type No. of Beds

En-suite cluster beds 135

En-suite studio beds 52

Total 187

PLANNING AND DEVELOPMENT POTENTIALThe building is currently in mixed use. The ground and first floors benefit from a planning permission for Class A3 Use dating from 2003. The upper floors are in Class B1 office use.

The site lies within the City Centre Principal Business Area (Cardiff Local Plan) and the Central and Bay Business Area (Emerging Cardiff LDP) designations. Policies within each plan indicate that suitable uses within this area include offices, residential and commercial leisure uses and other uses appropriate for city centres. Recent experience indicates that there is scope to argue alternative uses in such situations.

Subject to planning, suitable alternative uses would include student accommodation, residential or commercial leisure uses. Potential is also considered to exist to extend the building to provide additional accommodation at roof level. For further planning background, please contact Paul Williams of Savills on 02920 368906 or Cardiff City Council.

DEVELOPMENT PROPOSALSIndicative plans for a conversion and extension of the office area to student accommodation have been prepared by Stride Treglown architects

The plans show potential for a 187 bed cluster and studio scheme, with studios making up 28% of the beds. The plans incorporate a 2 story extension on the existing property. Should the building not be extended, Stride Treglown expect 156 beds could be achieved within the existing envelope.

FRIARY HOUSE

CARDIFF UNIVERSITY

INDICATIVE STUDENT ACCOMMODATION SCHEME (ASSUMING TWO STOREY EXTENSION)

Key: Red hatching is the extent of the proposed extension

CARDIFF OFFICE MARKETThe Cardiff office take-up for 2013 was just under 300,000 sq ft, fuelled by a particularly active Q4. Supply of good quality Grade A office is now at an all time low, with new office developments currently in the pipeline which are likely to drive Grade A rents towards £23 per sq ft.

Headline rents remain at £22 per sq ft in the city centre and with prime product increasingly limited, incentives are beginning to fall. Prime rents are expected to grow by 5% over the next 18-24 months, with good quality refurbishments likely to see an up lift over this time.

We expect to see a steady rise in refurbishment activity in Cardiff City Centre secondary located office buildings or a greater opportunity for alternative use such as student and residential uses.

STUDENT ACCOMMODATION MARKET IN CARDIFFCardiff is a strong higher education city boasting three universities with a total of 50,165 full time students. Cardiff University has more than 21,000 full time students and is 33rd in the UK (The Times Good University Guide 2014). Other universities in Cardiff include Cardiff Metropolitan University and the University of South Wales.

UK-wide, the 2013/14 student intake has been positive and the most recent data from UCAS (December 2013) has indicated that there was a 9% upturn in accepted university places.

This supply and demand imbalance is likely to be intensified by an increasingly restrictive and challenging planning environment which will limit future student accommodation development impacting and consequently insulate rents and values of well located existing assets. In addition, we expect a continuation in the trend of migration of students from the HMO sector to purpose built housing as legislation tightens and the price differential between the two remains narrow.

InstitutionTotal Full-time Students

Applications Per Place

University Bedrooms

Supply/ Demand

The Times Ranking 2014

Cardiff University

21,425 5.2 5,170 24% 33

Cardiff Metropolitan University

10,430 3.3 937 9% 87

University of South Wales

18,310 N/A 1,420 8% N/A

Total 50,165 7,527 15%

Source: (Times Good University Guide 2014/HESA/Savills Research)

PURPOSE BUILT STUDENT ACCOMMODATION IN CARDIFFThere are currently 11,421 purpose built student bed spaces throughout the city, of which 7,527 are university operated and 3,894 are privately owned. The remaining 38,744 students live within HMO’s or at home. This means that only c.23% of full-time students are able to access purpose built student accommodation in Cardiff.

STUDENT ACCOMMODATION SUPPLY IN CARDIFF

Important noticeSavills, their clients and any joint agents give notice that: 1: They are not authorised to make or give any representations or warranties in relation to the property either here or elsewhere, either on their own behalf or on behalf of their client or otherwise. They assume no responsibility for any statement that may be made in these particulars. These particulars do not form part of any offer or contract and must not be relied upon as statements or representations of fact. 2: Any areas, measurements or distances are approximate. The text, photographs and plans are for guidance only and are not necessarily comprehensive. It should not be assumed that the property has all necessary planning, building regulation or other consents and Savills have not tested any services, equipment or facilities. Purchasers must satisfy themselves by inspection or otherwise. 04/14 310584

Lizzie Whetman

020 7016 3863

07807 999 174

[email protected]

Ross Griffin

02920 368 961

07972 000 113

[email protected]

CONTACT

EPCThe EPC rating for Friary House is F128.

TENUREFreehold, however, consideration will be given to splitting the interests between Tiger Tiger and the offices.

VATThe property is elected for VAT purposes and therefore VAT will be payable by the purchaser, unless the sale is structured as a TOGC.

FURTHER INFORMATIONFurther information is available on the dataroom: www.savills.com/friaryhouse

PROPOSALWe are instructed to seek offers in excess of £7,000,000 (Seven Million Pounds).

office/leisure investment with potential for...

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