the clyde portfolio · 2020. 5. 4. · the clyde portfolio is an exceptional opportunity to acquire...

A Scottish Residential Investment Portfolio

THE CLYDE PORTFOLIO

INVESTMENT SUMMARY

• 87 residential properties contained within 7 separate developments across Scotland

• 72% of the properties are contained within self-contained, unbroken blocks • Current gross annual income: £505,020• 91% of properties currently tenanted • Tenanted properties currently subject to a mix of PRT

(43%), SAT (47%) & Assured Tenancy (10%) agreements• Estimated Rental Value per annum: £594,900

DESCRIPTION The Clyde Portfolio is an exceptional opportunity toacquire a stabilised, income producing portfolio of residential properties located across the Central Beltof Scotland.

30% of the properties within the portfolio are situated within the Greater Glasgow area, 5% in Edinburgh, with the remaining 65% located within the key commuter hubs of Paisley, Rutherglen and Hamilton.

The portfolio offers a range of asset management opportunities. The properties within the portfolio are well located to benefit from Scotland’s growing Private Rented Sector. Those properties held in unbroken blocks also provide a purchaser with the opportunity to achieve enhanced operating efficiencies.

14% of the properties are 1 bedroom flats and 85% of the properties are 2 bedroom flats. The portfolio also includes1 x 2 bedroom end terraced house.

THE CLYDEPORTFOLIO

PAGE 2 THE CLYDE PORTFOLIO PAGE 3 THE CLYDE PORTFOLIO

SCOTTISH RESIDENTIAL MARKET

Scotland’s residential market has remained resilient in the face of political uncertainty. Whilst transaction numbers in many UK regions have fallen, in Scotland there was a slight annual increase of 1% to 102,156 transactions during the 12 months ending November 2019. The official UK House Price Index for Scotland increased by 1.4% between October 2018 and October 2019. Scotland has witnessed positive annual house price growth for 43 consecutive months between April 2016 and October 2019.

In Scotland Savills forecast prices to increase by 2.0% in 2020, with five-year growth of 19.9% by 2024, compared to 15.3% across the UK as a whole.

SAVILLS SCOTLAND MAINSTREAM RESIDENTIALVALUES FORECAST

GLASGOW RESIDENTIAL MARKET

The number of transactions across Glasgow City increased slightly by 1%, from 11,552 during the 12 months ending November 2018 to 11,708 during the 12 months ending November 2019. The increase was mainly concentrated in the second hand market, whereas the new build market remained stable.

The number of transactions during the 12 months ending November 2019 was 16% higher than the 10-year annual average of 10,132. Whilst transactional growth increased above £200,000, there was an equal increase below this level. As a result, the average transaction price remained almost the same, from £160,344 during the 12 months ending November 2018 to £159,630 during the 12 months ending November 2019. This figure was 13% higher than the 10 year average of £141,858.

Over the course of 2019, growth in transactional activity spread out from the city of Glasgow and surrounding hotspots into the more attainable commuter locations of Lanarkshire, Inverclyde, Renfrewshire and West Dunbartonshire. Annual transaction price growth in these areas averaged 2% during the 12 months ending November 2019. Furthermore, there was a 3% annual rise in transactions in these areas. The locations that have seen a significant rise in transactions are mainly on the periphery of Glasgow, as its sphere of influence spreads.

SCOTTISH RESIDENTIAL RENTAL MARKET The demand for rental property remains strong in Scotland, as the number of households living in this sector across the country has increased by over 200% in 20 years from 110,000 households in 1999 to 350,000 in 2018.

The growth of the PRS has come against the backdrop of continued undersupply of new housing in Scotland across all tenures. The issue is particularly acute in Glasgow and Edinburgh. The demand for student housing and short rental accommodation (such as Airbnb) in both cities has further aggravated the demand and supply imbalance.

According to City Lets research, average rents in Scotland grew by 3.5% in the year to Q4 2019 and over the previous 5 years by 9.0%. Average rents in Glasgow grew by 4.0% (over 1 year) and 19.2% (over 5 years).

SAVILLS MAINSTREAM RENTAL FORECASTS

Year Mainstream valuesannual change forecast

2020 2.0%

2021 6.0%

2022 3.5%

2023 3.5%

2024 3.5%

Five-year growth 19.9%

Year UK (excluding London)

2020 2.0%

2021 2.5%

2022 3.0%

2023 3.5%

2024 2.5%

Five-year growth 13.1%

Length of occupancy of currenttenants within The Clyde Portfolio

Up to 2 years 41.03%

2 to 5 years 15.38%

5 to 10 years 25.64%

10 to 15 years 12.82%

15 to 30 years 5.13%

Ayr

Kilmarnock

East Kilbride

Hamilton

Paisley

Newmains

Livingston

Falkirk

Cumbernauld

Coatbridge

Lennoxtown

Balloch

Edinburgh

Glasgow

M77

M74

M8

A71

A71

A76

A725

M8

M80

A737

A82

A70

A702

Bothwell

Cambuslang

M77 A77

A761

A739

M74

M80

M73

M8 M8

M8 A74

A725 Hamilton

East Kilbride

Giffnock

RutherglenDarnley

Paisley

RenfrewGLASGOWAIRPORT

Partick

GlasgowCity Centre

Bishopbriggs

Stepps

Coatbridge

Asset Number Asset Name Location Asset Type *

Gross Internal Floor Area (Sq Ft)

**

No. Of Residential

Units

Passing Rent (Per Annum)

Estimated Rental

Value (Per Annum)***

1 Bellwood Street Glasgow Unbroken 4,710 6 £44,640 £46,800

2Parsonage

SquareGlasgow Broken 4,355 7 £42,180 £61,500

3Waterside Gardens

Glasgow Unbroken block & single house

9,666 13 £74,520 £87,600

4 Stonefield Park Paisley Unbroken 13,683 27 £144,120 £156,600

5 Campbell Close Hamilton Broken 9,308 12 £64,200 £82,800

6 Overtoun View Rutherglen Unbroken 14,868 18 £103,200 £118,800

7 Gogarloch Syke Edinburgh Broken 2,261 4 £32,160 £40,800

Total 58,851 87 £505,020 £594,900

PORTFOLIO SUMMARY


1

1

1

5

2

6

3 4

7

4

4

5

5

6

6

3

3

7

2

2

* Unbroken A whole development or a self contained staircore, where

100% of the residential properties are within the ownership of the vendor and form part of this sale.

** Gross Internal Floor is total area of the individual flats only and excludes communal areas.

* Broken Multiple properties owned by the vendor that form part of

a residential staircore or block that also contain properties owned by third parties.

*** Estimated Rental Value is based on the current condition of the properties

Ordnance Survey © Crown Copyright 2020. All Rights Reserved.Licence number 100022432Plotted Scale - 1:1250. Paper Size - A4



ASSET NO 1

BELLWOOD STREETGLASGOW G41 3ED

ASSET NO 2

PARSONAGE SQUAREGLASGOW G4 0TH

ASSET NO 3

WATERSIDE GARDENS SANDBANK CRESCENTGLASGOW G20 0PR

INVESTMENT SUMMARY NO. OF UNITS 6TOTAL GIA SQ FT OF UNITS 4,710OCCUPANCY 100%PASSING RENT £44,640ERV £46,800TYPE Unbroken

PROPERTY DESCRIPTION • 6 x 2 bedroom flats (785 sq ft av. GIA) • Existing tenants subject to 5 x SAT and 1 x PRT agreements • Located in heart of Shawlands district of Glasgow • Pollokshaws East Railway station 0.5 km from asset• Built in 2003 • Secure undercroft car parking

INVESTMENT SUMMARY NO. OF UNITS 7TOTAL GIA SQ FT OF UNITS 4,355OCCUPANCY 86%PASSING RENT £42,180ERV £61,500TYPE Broken

PROPERTY DESCRIPTION • 3 x 1 bedroom flats (555 sq ft av. GIA) & 4 x 2 bedroom flats (672 sq ft av. GIA)• Existing tenants subject to 2 x SAT and 4 x PRT agreements• Located within the Merchant City area of Glasgow • City centre location • On street parking • Communal landscaped gardens

INVESTMENT SUMMARY NO. OF UNITS 13TOTAL GIA SQ FT OF UNITS 9,666OCCUPANCY 85%PASSING RENT £74,520ERV £87,600 TYPE Unbroken

PROPERTY DESCRIPTION • 12 x 2 bedroom flats (732 sq ft av. GIA) & 1 x 2 bedroom terraced house (883 sq ft GIA)• 12 x flats within a single self contained, unbroken block • Existing tenants subject to 2 x Assured, 3 x SAT and 6 x PRT agreements • Located within the Maryhill area of Glasgow• Situated adjacent to Forth & Clyde Canal• Off street car parking • Developed in 2002



ASSET NO 4

STONEFIELD PARKPAISLEY, PA2 7RT

INVESTMENT SUMMARY NO. OF UNITS 27TOTAL GIA SQ FT OF UNITS 13,683OCCUPANCY 96%PASSING RENT £144,120ERV £156,600TYPE Unbroken

PROPERTY DESCRIPTION • 9 x 1 bedroom flats (398 sq ft av. GIA) & 18 x 2 bedroom flats (561 sq ft av. GIA)• All flats within a single unbroken development • Existing tenants subject to 15 x SAT and 11 x PRT

agreements• Located to south of Paisley town centre• Situated close to Glasgow Airport (5.3km)• Off street parking



ASSET NO 5

CAMPBELL CLOSEHAMILTON, LANARKSHIRE, ML3 6BF

ASSET NO 6

OVERTOUN VIEW 2 ROGER PLACE, RUTHERGLEN G73 2AX

INVESTMENT SUMMARY NO. OF UNITS 12TOTAL GIA SQ FT OF UNITS 9,308OCCUPANCY 83%PASSING RENT £64,200ERV £82,800TYPE Broken PROPERTY DESCRIPTION • 12 x 2 bedroom flats (776 sq ft av. GIA)• Part of wider residential development • Existing tenants subject to 6 x SAT and 4 x PRT agreements• Located to north east of Hamilton town centre• Situated opposite Asda supermarket• Allocated off street parking

INVESTMENT SUMMARY NO. OF UNITS 18TOTAL GIA SQ FT OF UNITS 14,868OCCUPANCY 89%PASSING RENT £103,200ERV £118,800TYPE Unbroken PROPERTY DESCRIPTION • 18 x 2 bedroom flats (826 sq ft av. GIA)• Flats all contained within 3 unbroken, self contained &

adjoining blocks• Existing tenants subject to 4 x Assured, 5 x SAT and 7 x PRT agreements• Located in the Rutherglen area of Glasgow• Close to Rutherglen (1.4km) & Burnside train stations

(1.0km) • Off street parking • Landscaped communal gardens



ASSET NO 7

GOGARLOCH SYKEEDINBURGH EH12 9JE

INVESTMENT SUMMARY NO. OF UNITS 4TOTAL GIA SQ FT OF UNITS 2,261OCCUPANCY 100%PASSING RENT £32,160ERV £40,800TYPE Broken PROPERTY DESCRIPTION • 4 x 2 bedroom flats (565 sq ft av. GIA) • Part of wider residential development containing 9 x flats• Existing tenants subject to 1 x SAT, 2 x Assured and 1 x PRT

agreements • Located in South Gyle area of Edinburgh • Situated close to South Gyle train station (0.8km) • Allocated off street parking • Landscaped communal gardens

SUMMARY OF TENANCY AGREEMENTS

PRIVATE RESIDENTIAL TENANCY (PRT)A private residential tenancy replaced assured and short assured tenancies in Scotland. Every new residential tenancy from 1 December 2017 in Scotland is a private residential tenancy as long as the:

• tenant lives in it as their only or main home• tenancy is not excluded under schedule 1 of the Private Housing (Tenancies) Act• property is let to a person as a separate dwelling

The new tenancy is open-ended and will last until a tenant wishes to leave the let property or a landlord uses one (or more) of 18 grounds for eviction. SHORT ASSURED TENANCY (SAT)These are tenancies that started before 1 December 2017 but started after 2 January 1989 as long as:

• the property was rented as a home• it is the tenants only or main home• the tenant received an AT5 form before the tenancy started informing the prospective tenant it was an short assured tenancy• the tenancy is for at least six months but for a fixed length of time

If the landlord requires vacant possession at the end of a short assured tenancy, the tenant is required to leave and the landlord does not have to give a reason. However, the landlord is required to give the tenant:

• a ‘notice to quit’• at least two months’ notice in writing that they want vacant possession (a Section 33 notice)

Any short assured or assured tenancy which existed before 1 December 2017 will continue until either the tenant or the landlord bring it to an end. If the tenant’s short assured tenancy is renewing on a contractual basis, this can continue to renew under the Housing (Scotland) Act 1988 until either the landlord or the tenant bring it to an end.

ASSURED TENANCYAn assured tenancy will have started after 2 January 1989, however before the tenancy started the prospective tenant was not given an AT5 notice stating that the tenancy was a short assured tenancy. With an assured tenancy, the landlord cannot secure vacant possession without giving a valid reason (there are 17 different grounds for eviction). When a tenancy term runs out, it will automatically renew itself unless: the tenant gives the landlord written notice that they want to leave, or the landlord gives the tenant written notice that they want the tenant to leave because they have broken a condition of the tenancy agreement.

OTHER INFORMATION

METHOD OF SALE The portfolio is offered for sale by informal tender with offers sought for the heritable interests, subject to current occupational tenancies. The vendors will consider offers for individual assets as well as the whole (7 assets). Further details are provided in the Sales Process Letter in the data room.

MANAGEMENT AND LETTINGSManagement of the portfolio is currently carried out by Touchstone. Lettings are carried out by a number of local lettings agents.

ENERGY PERFORMANCE CERTIFICATESThese are contained within the data room.

INSPECTIONSInternal inspections are strictly by prior arrangement with the selling agents only.

ONLINE DATA ROOMA data room is available at:

https://sites.savills.com/ClydePortfolio

SCOTLAND

George Hepburne Scott, MRICSDirector, Development 0131 247 [email protected]

Emma Biggin, MRICSAssociate, Development0141 222 [email protected]

RESIDENTIAL CAPITAL MARKETS Piers de Winton, MRICSDirector, Residential Capital Markets020 7016 [email protected]

James Nicholls, MRICSSurveyor, Residential Capital Markets020 7409 [email protected]

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. February 2020.

CONTACTS

Maps and PlansReproduced from the Ordnance Survey Map with the permission of the Controller of H.M. Stationery Office. © Crown copyright licence number 100024244 Savills (UK) Ltd.

Published for the purposes of identification only and although believed to be correct accuracy is not guaranteed.


the clyde portfolio · 2020. 5. 4. · the clyde portfolio is an exceptional opportunity to acquire...

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