PRIME SOUTH EAST INDUSTRIAL DISTRIBUTION INVESTMENT Hermes Parcelnet, 15 Mills Road, Quarry Wood Industrial Estate, , ME20 7XB 2 Hermes Parcelnet, 15 Mills Road, Quarry Wood Industrial Estate, Aylesford, ME20 7XB

investment summary

·· Premier distribution facility located on the ·· Modern industrial unit providing 48,376 sqft ·· Total passing rent of £290,000 per annum, established Quarry Wood industrial estate (4,494.3 sqm) of warehouse accommodation reflecting a low passing rent of £5.99 per in Aylesford. on a site to 2.64 acres (1.068 hectares); site sqft providing excellent prospects for coverage of 35%. rental growth. ·· Excellent transport communications to the national motorway network, and the ·· Let to the undoubted covenant of Hermes ·· Offers are invited in excess of £4,950,000 sea ports of . Junction 5 Parcelnet Ltd (D&B rating: 5 A1), until 25th subject to contract and exclusive of VAT. A of the M20 is only 1.2 miles (1.9 km) from March 2022, providing a further 4.4 years of purchase at this level would reflect a Net the property. secure income. Initial Yield of 5.50%, after allowing for purchaser’s costs of 6.59%. This reflects a ·· Freehold. capital value figure of £102 per sqft. 3 Hermes Parcelnet, 15 Mills Road, Quarry Wood Industrial Estate, Aylesford, ME20 7XB

GLASGOW EDINBURGH LOCATION

Aylesford is located 4.0 miles (6.4 km) north Aylesford is located approximately 35 miles tourist vehicles, 2.5 million freight vehicles and west of the County town of . (56.3 km) south east of Central London and 30 supported 22,000 jobs. The ports of Folkstone Collectively they form a major commercial miles (48 km) west of . and Tilbury are also within a 45 minute drive. centre within the south east of England, which NEWCASTLE The town benefits from excellent road Aylesford train station is only 1.1 miles away UPON-TYNE is home to a significant labour catchment. communications being adjacent to Junction 5 and offers services into central London with a

MIDDLESBOROUGH of the M20 motorway. The M20 Motorway fastest journey time of 53 minutes. Ebsfleet links with the National Motorway Network via International Station is approximately 25 the M25, which is accessed by either Junction 3 minutes drive and provides 4 trains an hour to M6 or 5, 15 miles to the west. London St Pancras, with a journey time of A1(M) approximately 18 minutes. The Port of , which is Europe’s busiest LEEDS HULL ferry port, handling £119 billion of trade or The international airports of London Gatwick, M62 M62 17% of the UK’s trade in goods, is located 44 London Heathrow, London Stanstead and MANCHESTER DONCASTER M180 miles (71 km) to the south east. In 2016 the London City are all within 1.5 hour’s LIVERPOOL M18 Port handled 13 million passengers, 2.4 million drive time. SHEFFIELD A1

M1 M6 NOTTINGHAM PORT OF LONDON M20 2 miles, 5m TILBURY 35 MILES 31 MILES M54 M42 1HR 10MINS 42 MINS A1 M26 5 miles, 8m PETERBOROUGH BIRMINGHAM COVENTRY M42 A14 A2 9 miles, 17m CAMBRIDGE DOVER M5 RUGBY 47 MILES M1 M2 11 miles, 18m M40 A14 53 MINS NORTHAMPTON FELIXSTOWE M50 OXFORD M25 16 miles, 18m M11 CHANNEL M40 M25 TUNNEL READING M1 64 miles, 1h 5m PORT OF TILBURY 37 MILES M4 CARDIFF LONDON 56 MINS A34 M25 40 MILES BRISTOL M3 M2 AYLESFORD PORT OF DOVER 44 MINS M20 M23 M3 PORT OF FOLKESTONE GATWICK 35 miles, 38m PORTSMOUTH

M5 SOUTHAMPTON HEATHROW 56 miles, 57m

STANSTEAD 58 miles, 1h 8m HGV DRIVE TIMES

2 hours 3 hours 4.5 hours LUTON 76 miles, 1h 21m SOUTH A20 LONDON ROAD RETAIL AYLESFORDPARK

LAKE ROAD 4 Hermes Parcelnet, 15 Mills Road, Quarry Wood Industrial Estate, Aylesford, ME20 7XB SAINSBURY’S SUPERMARKET McDONALD’S

SITUATION 14-18 LAKE RD IND. EST. BURNT ASH TRADE PARK 8-13 LAKE RD BEADLES SKODAAUTO BEADLES IND. EST. ARDEN The property occupies a prominent position Given the unprecedented rise in online retail VOLKSWAGEN VAUXHALL fronting Mills Road in the centre of Quarry sales, the property offers an ideal location to MAIDSTONE BUR Wood Industrial Estate. The site is bound to provide crucial last mile distribution services NT ASH the west by Wealden Way and the north by and flexible delivery options to a large catchment ROAD PLUMB Lake Road. There are two points of access into of business and residential customers. CENTER WOOD CLOSE 1-7 LAKE RD BEADLES the property, one for staff and visitors TOYOTA The property lies within close proximity to the IND. EST. accessed off Mills Road and delivery access vibrant South Aylesford Retail Park home to for lorries and vans onto the service via BURNT ASH TRADE PARK several national retailers including Homebase, ACT COMMUNICATIONS Lake Road. Marks & Spencer, Halfords, Curry’s PC World, EUROWAY LAKE ROAD TRADE PARK GUY SALMON LEAY Harvey’s and a newly built Nando’s unit. JAGUAR PLUMBING & HEATING WAREHOUSE Not to scale - for indicative purposes only EUROWAY MILLS ROAD LOOMIS TRADE PARK GUY SALMON LAND ROVER London

WATERLOO HERMITAGE LANE AIR PRODUCTS ADVENTURE AYLESFORD AD RO R KIDZ N IV IO ER T STA AD M TA TION RO S ED WAY

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A20 CSM: ICON WAREHOUSE Ashford MILLS ROAD Holt Hill H CLEANSING W O INDUSTRIAL L SERVICE GROUP O T ESTATE O W

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MILLS ROAD 5 Hermes Parcelnet, 15 Mills Road, Quarry Wood Industrial Estate, Aylesford, ME20 7XB M20 M20 JUNCTION 5

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F L LOOMIS R 6 Hermes Parcelnet, 15 Mills Road, Quarry Wood Industrial Estate, Aylesford, ME20 7XB

DESCRIPTION

The building comprises a single storey industrial warehouse of portal frame construction fronted by two storeys of standard office accommodation. The outer walls are clad with blockwork lined brick at ground level and lined profile metal sheeting at first floor level. At first floor level the rear element of the office accommodation has been opened up to the warehouse to provide additional mezzanine accommodation. The front section of the first floor offices are not currently used by the tenant. The building has 6 loading doors to the northern elevation accessed directly off the exterior service yard. The property benefits from a highly secure 3 metre perimeter fence. 7 Hermes Parcelnet, 15 Mills Road, Quarry Wood Industrial Estate, Aylesford, ME20 7XB

ACCOMMODATION

The property has been measured in accordance with the RICS Property Measurement (1st Edition) and extends to 48,376 sqft (4,494.3 sqm). The current internal configuration provides 34% office content. The rear part of the first floor office accommodation has been altered to open out to the warehouse to provide additional storage. Part of the front section of the first floor offices are currently unused by the tenant.

FLOOR SQM SQFT

Ground Floor Warehouse 2,971.6 31,986

Ground Floor Office 757.0 8,148

First Floor Office 765.7 8,242

Total 4,494.3 48,376

The site extends to 2.64 acres (1.068 hectares) which represents a low built site coverage of 35%. Service yard average depth from access of Lake Road is 35m, average yard width is 86m providing excellent access, turning and lorry parking facilities.

TENURE

The property is held Freehold. 8 Hermes Parcelnet, 15 Mills Road, Quarry Wood Industrial Estate, Aylesford, ME20 7XB

TENANCY COVENANT INFORMATION

The property is let to Hermes Parcelnet Ltd Notice has been served on the tenant at a by way of a Full Repairing & Insuring lease for rent of £337,284 per annum, which equates Hermes Parcelnet Ltd a period of 10 years from 26th March 2012, to £6.75 per sqft plus a rate of 50% on the (Company reg: 03900782) expiring 25th March 2022; therefore, providing canopied yard area. a further 4.4 years of secure income. The rent review provisions within the lease Hermes Parcelnet Limited (D&B Rating: 5A1) is Hermes works with a wide range of leading The current passing rent of £290,000 per annum assume a hypothetical term of 10 years with a the UK’s leading consumer delivery specialist high street, catalogue and online retailers in equates to a low overall rate of £5.99 per sqft. tenant’s break option in year 5. handling more than 245 million parcels each the UK including Next Directory, ASOS, Tesco, year. Hermes provides a range of flexible and John Lewis, Debenhams and Arcadia Group. The rent review dated 26th March 2017 Further information can be provided affordable delivery options to home, work, Hermes UK is owned by the German group remains outstanding. upon request. neighbour, safe place or ParcelShop that are Hermes Logistik Gruppe Deutschland (HLGD) convenient for the consumer and fit within who is the largest independent home delivery their increasingly busy lifestyles. Within the specialist for business-to-consumer (B2C) and UK, Hermes operates a network of over 10,000 consumer-to-consumer (C2C) sectors lifestyle couriers and over 4,500 ParcelShops. in Germany.

YEAR END TURNOVER PRE-TAX Profit NET WORTH

28th February 2016 £510,369,000 £33,727,000 £74,132,000

28th February 2015 £442,569,000 £36,357,000 £65,777,000

28th February 2014 £382,313,000 £33,552,000 £61,450,000

Hermes Parcelnet in Aylesford Hermes took occupation of the property in 2012 to serve the residential community of Aylesford, Maidstone and the wider Kent district (1.54m residents); the unit is operated on a 24/7 basis and has the capacity to process up to 42,000 packages over 24 hours.

ENVIRONMENTAL

Delta-Simons carried out a Phase I Environmental The site is not located in an area at risk of flooding. Assessment of the site in June 2017. The report A copy of the full report is provided on the data concluded that potential land contamination site supporting the sale. issues and associated environmental liabilities represent a ‘Low‘ risk in its current use. 9 Hermes Parcelnet, 15 Mills Road, Quarry Wood Industrial Estate, Aylesford, ME20 7XB

OCCUPATIONAL MARKET COMMENTARY

Aylesford is an established South-East distribution Access Park location situated midway between Central Access Park, north of the M20 between junctions 4 & 5, provides 85,871 sqft across three units. Unit 2B London and the UK’s main coastal transport nodes has been let to Bunzl by way of a 10 year term in September 2017 at a rent of £7.75 per sqft. Units 2A of Dover and the . and 2C are also under offer to distributors, both at rents which equate to £7.75 per sqft. With approximately 80,000 residents within Invicta Riverside a 15-minute drive time and access to the M20 Invicta Riverside, also north of the M20 between junctions 4 & 5, provides 189,673 sqft across three motorway in under 1.5 miles from the property, units. DFS agreed to take Unit 3, 59,346 sqft for an unbroken term of 15 years in March 2017. The Quarry Wood is ideally positioned to serve both agreed rent equates to £7.25 per sqft. Unit 1 & 2 were let late in Q4 2015 and Q1 2016, Unit 1 extends the local residents and the wider Kent population to 89,307 sqft and was let to Amazon for a 5 year term at a rent of £6.75 per sqft; Unit 2 extends to (1.54m people). 41,020 sqft and was let to TTS Ltd for 6 years term certain at a rent of £7.25 per sqft. Distribution accommodation is currently in limited supply, this combined with increasing ‘Section B’ Mills Road demand from internet based commerce, “just in Opposite Hermes Parcelnet on Mills Road, Quarry Wood, ‘Section B’ Mills Road was let to Horizon time” and “last mile” deliveries has sought to put International Cargo Ltd in July 2017 by way of a 10-year lease with a break clause in year 5. The pressure on rents within the surrounding area, refurbished unit comprises 65,992 sqft, has one point of access, restricted circulation and a site cover of as demonstrated by the recent lettings at Invicta c. 50%. The rent agreed reflects a headline rate of £6.75 per sqft which after the 9 month rent free and 3 Riverside and Access Park in Aylesford. month break penalty provides a net effective rate of £6.41 per sqft.

INVESTMENT MARKET COMMENTARY

Recent deals highlighting the strength in this sector include:

PROPERTY DATE STATUS PRICE NIY SIZE TENANT WAULT AVG RENT CAP VAL (sqft) (Exp/Br) (per sqft) (per sqft)

Unit A, Tongwell Street, Milton Keynes Oct-17 under Offer £15,400,000 3.90% 103,644 Westcoast Ltd 8.70/3.70 £6.19 £148.60

Unit 4, Golden Business Park, Leyton Oct-17 under Offer c.£4,800,000 c.3.75% 21,413 fedEx UK Ltd 5.20 £8.93 £224.16

Unit K60, Lister Road, Basingstoke Oct-17 completed £9,515,000 5.18% 58,504 Bunzl UK Ltd 9.50/4.50 £8.98 £162.64

Unit 18, Mitcham Industrial Estate Aug-17 completed £4,250,000 5.19% 29,109 Go Carting for Fun Ltd 19.00/9.00 £8.00 £146.00

Dawson Road, Milton Keynes Jun-17 completed £10,410,000 5.40% 108,018 yokokama H.P.T Ltd 3.75 £5.55 £96.37

Unit A, Link 20, Bellingham Way, Aylesford Jun-17 completed £2,475,000 5.50% 24,343 csc Computer Sciences Ltd 9.00/4.00 £7.02 £101.67 10 Hermes Parcelnet, 15 Mills Road, Quarry Wood Industrial Estate, Aylesford, ME20 7XB

EPC Proposal FURTHER INFORMATION

A copy of the Energy Performance Certificate We are inviting offers in excess of £4,950,000, Should you require further information or DATAROOM: (EPC) is available upon request. subject to contract and exclusive of VAT. would like to arrange a viewing, please contact: Gowling WLG are hosting the secure dataroom to support the sale. Access details can be A purchase at this level would reflect a Net Chris Dickin: provided by Clay Street upon request. Initial Yield of 5.50% allowing for purchaser’s [email protected] VAT costs of 6.59%. SUBJECT TO CONTRACT Rob Atkins: The property is elected for VAT and therefore This reflects a capital value figure of £102 per [email protected] sqft. VAT will be payable on the purchase price. It George Freeman: is anticipated that the sale will be treated as a [email protected] Transfer of a Going Concern. Telephone: 0207 935 2831

AREA RENT WAULT Hermes Parcelnet, Mills Road forms part of PROPERTY (sqft) (per annum) (to exp.) NIY CAP VAL PRICING the Quarry Wood Portfolio. BURNT ASH TRADE PARK 76,397 £687,694 7.55 5.50% £153 £11,720,000

The Quarry Wood Portfolio comprises MILLS ROAD INDUSTRIAL ESTATE 57,016 £370,350 3.67 5.75% £106 £6,040,000 2 multi let industrial estates and 2 single let HERMES PARCELNET, MILLS ROAD 48,376 £290,000 4.43 5.50% £102 £4,950,000 industrial warehouse assets. LOOMIS, LAKE ROAD 9,427 £81,750 6.18 6.50% £126 £1,190,000 The portfolio is available as a whole or in individual parts. QUARRY WOOD PORTFOLIO 191,216 £1,430,525 5.80 5.60% £125 £23,900,000

BURNT ASH TRADE PARK MILLS ROAD INDUSTRIAL ESTATE HERMES PARCELNET, MILLS ROAD LOOMIS, LAKE ROAD

IMPORTANT INFORMATION: 1. No description or information given by Clay Street Ltd whether or not in these Particulars and whether written or verbal (“information”) about the property or its condition or its value may be relied upon as a statement or representation of fact. Neither Clay Street Ltd (nor any joint agents) have any authority to make any representations and accordingly any information given is entirely without responsibility on the part of the agents or the seller. 2.These particulars do not constitute, nor constitute part of, an offer or contract, nor shall they merge in any offer or contract which may hereafter be made between the sellers or lessors and the recipient of the information. 3.The photographs show only certain parts of the property at the time they were taken. Any areas measurements or distances given are approximate only. 4. Any reference to alterations to or use of any part of the property is not a statement that any necessary planning, building regulations or other consent has been obtained.These matters must be verified by any intending buyer. 5. Any buyer must satisfy themselves by inspection or otherwise as to the correctness of any information given. Designed and produced by Diablo: www.diablodesign.co.uk November 2017