PRIME RETAIL FOR SALE LEISURE AND OFFICE INVESTMENT

106 / 112 BUCHANAN ST, 40 ROYAL EXCHANGE SQ & 7 ROYAL BANK PLACE

GLASGOW G1 3AA 106 / 112 BUCHANAN ST, 40 ROYAL EXCHANGE SQ & 7 ROYAL BANK PLACE 02

– is ’s largest city and is widely acknowledged as being the UK’s best retail centre outside . – The property occupies an entire block in 100% prime position on the pedestrianised section of Buchanan Street, which is Glasgow’s premier shopping thoroughfare. – The property is situated between St Vincent Place and Gordon Street close to Princes Square shopping centre and down from Buchanan Galleries. – Shopper footfall on Buchanan Street is estimated to exceed 1 million people per week. – The property comprises a magnificent new flagship restaurant occupied by The Ivy and further units let to Woollen Mill and Thomas Pink with offices let to Nationwide Building Society. – Future opportunities to refurbish and improve the offices, and to incorporate the 2 car garage as sales space into the Thomas Pink unit at ground floor level. – Current rental income of £874,705 per annum of which 80% is for leisure and retail uses and 20% is for office/mast use.

– Total ERV of £1,270,688 per annum (86% - 14% split). – Offers in excess of £20,500,000 (Twenty Million Five Hundred Thousand Pounds) are sought for the Heritable interest in the property. A purchase at this level will reflect a net initial yield of4.03%, rising to 5.85%. The net equivalent yield is 5.48% after allowing for purchaser’s costs and LBTT. 106 / 112 BUCHANAN ST, 40 ROYAL EXCHANGE SQ & 7 ROYAL BANK PLACE 03

Glasgow is one of the strongest shopping locations outside London City Centre retail floor space is estimated at 3 million sq ft with and is widely recognised as a European leading fashion destination. Buchanan Street at the centre of this. The city ranks No1 on the PMA Retail Provision score out of the UK’s top 200 retail centres; is within the top three and often the top of many other city centre rankings. The city centre provides a huge variety of retail offer from high Glasgow has an extensive retail catchment. The immediate catchment is street multiples, to boutiques, to international flagship stores and is densely populated. frequently first on the representation list for occupiers outside London. However, due to the extent of the retail offer the catchment also has a very long reach throughout the west coast and rest of the country.

This is further added to by the growing number of tourists and visitors to the city. There are 2.24m people within 45 minutes’ drive of the city and the prime thoroughfare of Buchanan Street attracts an estimated 1 million shoppers weekly*. Glasgow has a high comparison spend of £2.56 billion ranking it second in the UK behind London West End*. (*Source CACI) The city provides a concentrated effective mix of pedestrianised and covered retailing. The famous “z” shaped shopping core which takes in , Buchanan Street and Argyle Street provides the spine and prime pitch. At either end of Buchanan Street is Buchanan Galleries and St Enoch Shopping Centre, with the more boutique Princes Square shopping and leisure destination centered on Buchanan Street, all of which provide over 1.7 million sq ft. The retail offer on Buchanan Street has been expanded with the development of the 115,000 sq ft Buchanan Quarter by Land Securities – a high street development providing 11 retail stores, cafés & restaurants. It opened in March 2013 and is fully let demonstrating the inherent strength of tenant demand for Buchanan Street. The 62,000 sq ft flagship store was taken by H & M, other tenants in the development include Vans, Gap, Fat Face and Office. Top brands represented on Buchanan Street include – Hugo Boss, Apple, Zara, Levi’s, Urban Outfitters, Jack Wills, Nike and All Saints. At the south end of the street is a flagship store and the St Enoch centre providing tenants such as Hamleys (first store outside London), Debenhams, H&M and Superdry. At the north end of the street lies Buchanan Galleries anchored by John Lewis and including Hollister and Next. 106/112 Buchanan Street is centrally placed on the spine of the city’s retail core securing its long-term position as a prime pitch in one of the UK’s most important retailing centres. 106 / 112 BUCHANAN ST, 40 ROYAL EXCHANGE SQ & 7 ROYAL BANK PLACE 04

Andrew Buchanan envisioned that Glasgow would spread The first part of Buchanan Street from Argyle Street to westward. With this in mind, on the 15th of February, 1763, Gordon Street was opened in 1780 and the remaining section he acquired the first portion of “five acres or thereby of ground in 1804. Initially, the street was occupied by a mixture of in the Burgh of Glasgow, in the part called Palezeon’s Croft, merchants’ villas, smallholdings and some workshops but as on the North side of Argyle Street, with plots or steadings for the century progressed some very handsome buildings were building on each side thereof“. His plan was to take down his erected, the first of significance being St George’s Church, now Like many of the streets in the centre of Glasgow, Buchanan own mansion which was situated on Argyle Street opposite the known as St. George’s Tron Church, designed by William Stark Street was named after a famous merchant who had made his entrance to St. Enoch Square and thereby enable access to the and completed in 1808. Further fine buildings were added, fortune thanks to Glasgow’s reputation as the Second City of the new street. Unfortunately, the American War of Independence including the Glasgow Stock Exchange in 1875-77, designed by Empire. Opened in 1780, Buchanan Street took its name from (1775-1783) intervened and Andrew Buchanan lost his tobacco John Burnet. The street acquired a reputation for elegance and fortune. His business was wound up and his development plan specialty shopping which continues to this day. Andrew Buchanan, one of the city’s most successful tobacco ended up in the hands of some Glasgow bankers. Yet, in spite merchants. He was the head of two great Virginia tobacco of this setback, his vision soon became reality and lots on the houses, Buchanan, Hastie & Co and Andrew Buchanan & Co. street bearing his name were progressively occupied.

106 / 112 BUCHANAN ST, 40 ROYAL EXCHANGE SQ & 7 ROYAL BANK PLACE 05

The subjects lie on the east side of Buchanan St between St Vincent Place to the north and Royal Bank Place to the south. Nearby retailers include All Saints, The White Company, Hobbs, Lush, Vodafone, LK Bennett and Jack Wills. Nearby restaurants include TGI Fridays, Zizzi’s, Rogano and Miller & Carter.

BUCHANAN GALLERIES QUEEN STREET

106 / 112 BUCHANAN ST, 40 ROYAL EXCHANGE SQ APPLE & 7 ROYAL BANK PLACE STORE

URBAN OUTFITTERS

ST VINCENT STREET

BUCHANAN STREET

MASSIMO DUTTI

TED BAKER PRINCES SQUARE

GLASGOW HUGO BOSS CENTRAL

HOUSE OF FRASER 106 / 112 BUCHANAN ST, 40 ROYAL EXCHANGE SQ & 7 ROYAL BANK PLACE

This B Listed property was designed by Thomson and Sandilands in 1897/98 and comprises a four storey and basement Dunmore ashlar sandstone constructed property under a pitched timber and slated roof. There is a feature turret on the south-east corner. The building is bounded on the north side by North Court Lane.

106 BUCHANAN ST – Let to The Ivy over basement, ground and first floors. The property has frontage to Buchanan St and extensive return frontage to Royal Bank Place. The kitchen and staff facilities will be located on first floor level, with bar and restaurant seating on ground floor and part first floor connected by a new sales stair. Toilets will be located on all levels. 110/112 BUCHANAN ST - Let to Edinburgh Woollen Mill Ltd and trading as Hector Russell over ground and basement levels. There is sales space over both levels with staff and toilet facilities located within the basement. Both floors have plaster/papered walls with lowered acoustic ceiling tiles incorporating fluorescent panels lights and carpeting/timber to the floors. A central sales stair connects both levels. 1 ROYAL BANK PLACE – Let to Thomas Pink over ground, mezzanine and first floor levels. The ground floor benefits from a very prominent four bay aluminium shop front. The sales space is finished to a high standard and has plastered walls & ceiling with spotlights, A/C and a timber finished floor. This floor also incorporates disabled toilet facilities whilst the mezzanine is used for storage and the first floor is used for staff facilities. ROYAL BANK PLACE OFFICES – Let to Nationwide Building Society on 2nd and 3rd floors. The offices are accessed via control entry double doors leading into an attractive lobby area where an 8-person lift is located serving all upper floors. The offices comprise a mixture of cellular and open plan accommodation arranged around a central core where stairs, toilets and lift are located. The ceilings are a mixture of plaster/cornice and lowered acoustic whilst lights range from pendant to spot and integral fluorescent fixtures. Heating is generally by means of gas fired boilers and radiators. A separate fire stair/exit serves all levels. A 2 car garage accessed from North Court Lane and let to Nationwide B.S. is included. A new lift has recently been installed.

06 106 / 112 BUCHANAN ST, 40 ROYAL EXCHANGE SQ & 7 ROYAL BANK PLACE 07 106 / 112 BUCHANAN ST, 40 ROYAL EXCHANGE SQ & 7 ROYAL BANK PLACE 08

Ground

ENTRANCE

LOBBY

MG

DROP OFF 8.2m²

BAR COFFEE LARGE W/S WITH FRIDGE

UP TO 1ST FLR MEDIUM W/S UP

STILL ROOM/

13m² DWC 1660

2270

FIRE EXIT

BOH UP FRM STAIR BSMNT

THE IVY HECTOR RUSSELL NATIONWIDE THOMAS PINK COMMON PARTS

Basement First

MALE TOILETS FEMALE CHILLER TOILETS

STAFF CANTEEN

FREEZER

CORRIDOR

BAR OFFICE

LANDING LOBBY

REFUSE

POSSIBLE GENERAL STORE

CORRIDOR

FEMALE CHANGING POTENTIAL PDR PLANT ROOM

MALE CHANGING

THE IVY HECTOR RUSSELL COMMON PARTS THE IVY COMMON PARTS 106 / 112 BUCHANAN ST, 40 ROYAL EXCHANGE SQ & 7 ROYAL BANK PLACE 09

Second

NATIONWIDE COMMON PARTS

Third

NATIONWIDE COMMON PARTS 106 / 112 BUCHANAN ST, 40 ROYAL EXCHANGE SQ & 7 ROYAL BANK PLACE 10

UNIT USE TENANT LEASE START LEASE EXPIRY REVIEW RENT AREA SQ FT ITZA ZONE A RATE SQ FT ERV 106 BUCHANAN ST RESTAURANT TROIA UK RESTAURANTS 20/09/2018 19/09/2043 20/09/2023 £340,000 G – 2,445 1,987*3 £171.11 £636,198 LTD TRADING AS THE IVY B – 2,017 (£320 ZONE A) GUARANTEED BY 1 – 5,705 CAPRICE HOLDINGS LTD TOTAL – 10,167 110 / 112 RETAIL THE EDINBURGH 31/07/2005 31/07/2025 31/07/2020 £245,500 G – 764 1,027 £239.05 £328,640 BUCHANAN ST WOOLLEN MILL LTD (BK OPTION 31/07/2020) B – 2,714 (£320 ZONE A) TOTAL – 3,478 1 ROYAL RETAIL THOMAS PINK LTD 11/11/1996 10/11/2021 £119,205 G – 1,235 1,235 £96.52 £135,850 BANK PLACE 1 – 322 (£110 ZONE A) M – 432 TOTAL – 1,989 ROYAL BANK PLACE OFFICE NATIONWIDE BUILDING 01/09/2018*2 31/08/2027 01/03/2023 £80,000 5,550 £14.05 £80,000 2ND FLOOR SOCIETY (BK OPTION YRS 3 & 6) Plus 1 car space + £2,000 / space ROYAL BANK PLACE OFFICE NATIONWIDE BUILDING 01/09/2018*2 31/08/2027 01/03/2023 £85,000 5,584 £14.86 £85,000 3RD FLOOR SOCIETY (BK OPTION YRS 3 & 6) Plus 1 car space + £2,000 / space MAST ARQIVA LTD 30/06/2014 30/06/2029 30/06/2020*1 £5,000 £5,000

£874,705 26,768 £1,270,688

*1 30/06/17 rent review outstanding

*2 The lease start dates applicable to the Nationwide leases over levels 2 and 3 will commence upon conclusion of missives for the investment sale

*3 ITZA allows 8% deduction for quantum and 10% deduction for shape and frontage 106 / 112 BUCHANAN ST, 40 ROYAL EXCHANGE SQ & 7 ROYAL BANK PLACE 11

The current rental income is £874,705 per annum. We 1.TROIA UK RESTAURANTS LTD T/A THE IVY anticipate that this will rise to £1,270,688 per annum based is guaranteed by Caprice Holdings Ltd for a minimum of 5 on £320 Zone A at rent review for the Buchanan St units. years and thereafter until audited annual accounts disclose that the net pre-tax profits (before charging all depreciation) The existing percentage split for the ground floor units is 80% of the Tenant for each of the three consecutive financial with 20% from the upper floors. This would change to 86% years exceed three times the aggregate of the annual rent and 14% after the reviews/reversions. and any service charge payable in terms of the Lease. Caprice Holdings Ltd. For the year ending 01/01/2017 the company had turnover of £67m and a tangible net worth of £41.2m. Pre-tax profits were £8.7m. Troia UK Restaurants Ltd. For the year ending 30/07/2017 the company had turnover of £43.9m and an adjusted EBITDA of £4.7m. Originally opening in 1917 The Ivy now Existing Rental Income operate from over 16 restaurants nationwide. 2.EDINBURGH WOOLLEN MILL LTD have a D & B rating of 5A1. For the year ending 25/02/2017 the company had turnover of £171m and a tangible net worth Leisure - 38% of £159m. Pre-tax profits were £23.62m. Retail - 42% Founded in 1946, the company now operates in excess of 500 stores nationwide. Office - 19% 3.THOMAS PINK LTD have a D & B rating of 2A2. For Mast - 1% the year ending 31/12/2016 the company had turnover of £34m and a tangible net worth of £3.6m.

Founded in 1984, the company now operate 33 shops including stores in London, New York and Paris. 4.NATIONWIDE BUILDING SOCIETY ERV Income For the year ending 2017 the company had turnover of £3.28bn. Pre-tax profits were over £1.05bn. Founded over 130 years ago, the Society has over 15 million members. Leisure - 50% 5.ARQIVA LTD have a D & B rating of 5A1. For the Retail - 36% year ending 30/06/2017 the company had turnover of £637m and a tangible net worth of £1,481m. Pre-tax profits Office - 13% were £270.7m. Mast - 1% 106 / 112 BUCHANAN ST, 40 ROYAL EXCHANGE SQ & 7 ROYAL BANK PLACE 12

PROPERTY PRICE INITIAL DATE COMMENTS PURCHASER YIELD 78-90 Buchanan Street c£31m 4.00% Jul-18 Multi-let to Lush, Vodafone, Starbucks and offices. Analysed as 4% (Lush & Pontegedea & 9-17 Exchange Place Vodafone), 5.75% (Starbucks), 7.5% (offices). 4% initial yield rises to 4.48% 122-128 Buchanan Street £9.36m 4.2% Jul-18 Let to Scribbler & Swatch DTZim 130-140 Buchanan Street c£14m 4.00% Dec-17 Let to Starbucks & Edinburgh Woollen Mill Redevco UK 35-53 Buchanan Street £35.2m 4.68% Dec-17 Let to Frasers with an unexpired term of 142 years. Strathclyde PF The next rent review is 2044 147 Buchanan Street £47.8m 5.22% Nov-17 Multi-let mixed use block. Tenants include Apple, Skipton, TSB and Pontegadea & 48-72 St Vincent Street Mitchells and Butler. Unexpired term of 10.3 years to expiry and 8.5 years to the breaks. Analysed as 4% (Apple), 5.5% (St V St units), 6.75% (offices) 164A Buchanan Street £4.07m 4.40% May-17 Let to Clarks Shoes on a new 10 year lease Private Investor 20-26 Buchanan Street £29.30m 4.29% Mar-17 Let to Nike until September 2025. TBO 9/20 Redevco UK 55-59 Buchanan Street £22.15m 4.00% Feb-17 Multi-let to KIKO, Molton Brown and Russell & Bromley Ltd 4% initial Saudi Investor yield rises to 4.15%

Heritable interest (Scottish equivalent of English Freehold interest). Buchanan Street is currently witnessing unprecedented levels of occupier demand and consequently rental growth. Between circa 2005 and 2014 rents remained stable at £250 to £260 per sq ft Zone A however this has moved on considerably over the last 12/18 months with an extended period of rental growth which shows no sign of abating. This The property is VAT exempt and therefore no demand has resulted in a number of deals being agreed at in VAT will be chargeable on the purchase price. excess of £300 per sq ft Zone A with the top rent presently sitting at £320 per sq ft. There are still several outstanding requirements for the street and in line with occupier demand investment sentiment has also been very strong.

Full details are available in the data room. ADDRESS TENANT ZRATE / DATE SQ FT 57 Buchanan St Russell & Bromley £304 Jan 2017 42 Buchanan St Hotel Chocolat £307 Jan 2017 124 Buchanan St Scribbler £312 July 2017 131 Buchanan St T2 £317 Dec 2016 We are instructed to seek offers in excess of 36 Buchanan St Levi’s £320 Dec 2017 £20,500,000 (TWENTY MILLION FIVE 84 Buchanan St Vodafone £320 Dec 2017 HUNDRED THOUSAND POUNDS 9 Exchange Place Starbucks £113 Feb 2018 STERLING) subject to conclusion of missives and exclusive of VAT for the Heritable interest. A purchase at this level would reflect aNET INITIAL YIELD OF 4.03% rising to 5.85% allowing for standard purchaser’s costs based on LBTT. THE NET EQUIVALENT YIELD IS 5.48%. Legal documentation, plans, ITZA breakdowns, tenant credit reports and other information is held This is based on approximate NET EQUIVALENT within a Data Room. Access will be provided to YIELDS OF 5% (Buchanan St units), 6.25% interested parties via the selling agents. (Thomas Pink) and 9% (offices). FURTHER INFORMATION

For further information and to inspect the property please contact:

GRAEME FAITH DOUGLAS HOGG Graeme Faith & Co Ltd HSA Retail 0141 332 6392 0141 548 8062 [email protected] [email protected]

Graeme Faith & Co Ltd / HSA Retail for themselves, for any joint agents and 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 only for the guidance of intending purchasers or lessors and do not constitute, in whole or in part, an offer or contract. (ii) all descriptions, dimensions, references to condition and necessary permission for use and occupation, and other details, are given in good faith and are believed to be correct but any intending purchasers or tenants should not rely on them as statements or representations of fact but satisfy themselves by inspection or otherwise as to the correctness of each of them. (iii) no person in the employment of Graeme Faith & Co Ltd / HSA Retail has any authority to make or give any representation or warranty whatever in relation to this property. (iv) all rentals and prices are quoted exclusive of VAT. September 2018.