TWO LONG LET TRAVELODGE INVESTMENTS WITH RPI UPLIFTS

DUNFERMLINE ◆ GLENROTHES HOTEL INVESTMENT TRAVELODGE DUNFERMLINE

INVESTMENT CONSIDERATIONS ■■ Opportunity to acquire two modern, purpose built hotels located in Fife, totalling 100 rooms ■■ Total passing rent of £343,872 per annum ■■ 19+ years WAULT to the strong 5A1 covenant of Travelodge Hotels Ltd ■■ Fife is Scotland’s third largest local authority with a population just under 367,000, over a third of which live in the three principal towns of Dunfermline, Kirkcaldy and Glenrothes ■■ Travelodge is the 2nd largest budget hotel operator in the UK with currently over 560 hotels and 40,000 rooms ■■ Lease subject to five yearly uncapped RPI rent reviews ■■ Tenure: Heritable (the Scottish equivalent of Freehold) TRAVELODGE GLENROTHES DUNFERMLINE ■■ 50 room hotel ■■ Car parking for 50 vehicles ■■ Located 9 miles (14.5km) north of Edinburgh airport and 2.6 miles (4.2km) north east of Dunfermline town centre GLENROTHES ■■ 50 room hotel ■■ Car parking for 54 vehicles ■■ Located 2.8 miles (4.5km) south east of the picturesque Lomond Hills Regional Park PROPOSAL Offers are sought in excess of £5,400,000 (Five Million, Four Hundred Thousand Pounds) subject to contract and exclusive of VAT, reflecting an attractive net initial yield of 6.00% assuming purchasers’ costs of 6.13%. TRAVELODGE KINGSEAT ROAD, HALBEATH JUNCTION, DUNFERMLINE, KY11 8RY, SCOTLAND

LOCATION Dunfermline is a principal town on the east coast of Scotland, located approximately 15 miles (24km) north west of Edinburgh. The town has a population of over 50,000 and a wider catchment of 250,000 within a 20 minute drive time. Dunfermline is a major regional and commercial centre with key employers including Amazon, Sky, Bank of Scotland and Fife Council. The town has experienced rapid growth in recent years with multiple national house builders undertaking substantial residential developments, primarily in the nearby Masterton and Dulloch areas. 18,000 new homes are targeted to be built in Dunfermline and west Fife by 2026 as part of the “Key Growth Area” housing development strategy.

SITUATION The property is situated adjacent to the Halbeath Interchange which forms Junction 3 of the M90 motorway which connects with the main A92 trunk road. Access to the property is from Kingseat Road and the subject property is adjacent to an office park where occupiers include Scottish SPCA, Fife Services and Skyware Global. Halbeath Retail Park is also located 400m to the west of the

ad Ro h subject property, where occupiers include Asda Superstore, at be er th Pets at Home, Argos, Halfords and Homebase, as well as Ne Fife Leisure Park, where occupiers include Odeon Cinemas,

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Que en M arg ar The property is located 2.5 miles (4km) north west from the et Fa uld popular Dunfermline Abbey and the scenic Pittencrieff Park. A92

DESCRIPTION A907

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r g The property comprises a purpose built modern hotel a DUNFERMLINE t e s

QUEEN MARGARET R o a constructed in 2005, fitted to Travelodge’s corporate style. d Internally, the property comprises 50 bedrooms plus a large M90 P

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r A907 g lounge/lobby area. The ground floor has twelve bedrooms h

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o a plus a large lounge area, reception/staff accommodation d and a linen store. Both first and second floors have nineteen

L in b u bedrooms each plus a linen store. Access to the upper floors is r n R o a d by a central staircase or eight person lift, with an additional two G arv oc k Sandpip Ba er Dr n ive fire stairs at either end of the property. Externally there is a large k ACCOMMODATION & TENANCY INFORMATION d ve a ri Ro D rch lin h La un car park providing 54 parking spaces. Sout D e n Driv Dunli Tenant AccommodationAccommodation RentRent p.a p.a LeaseLease Start Start LeaseLease End End UnexpiredUnexpired Term Term ReviewReview TENURE (Years)(Years) Heritable (the Scottish equivalent of Freehold). Travelodge HotelsHotel: Hotel: 50 rooms,50 rooms, £196,735*£196,735* 09/12/200509/12/2005 29/09/203829/09/2038 19.519.5 UncappedUncapped RPI RPI Review Review LimitedHotels CarCar Park: Park: 54 spaces DecDec 2025, 2025, Dec Dec 2030, 2030, Dec Dec 2035 2035 Limited 54 spaces *Current*Current Rent Rent is topped£169,800 upp.a., to the rent topped up to the 2020 review SITE AREA based2020 review on a RPI increase of 2.5% 1.23 acres (0.497 hectares). TRAVELODGE BANKHEAD PARK, GLENROTHES, FIFE, KY7 6GH, SCOTLAND

LOCATION Glenrothes is the administrative centre and the third largest settlement in Fife, with a population of over 40,000. Glenrothes is situated between two of Scotland’s five cities approximately 31 miles (50km) north of Edinburgh and 22 miles (35km) south of Dundee in the Kingdom of Fife, which has a wider population of around 367,000. The town benefits from an excellent road network with easy access to the A92 dual carriageway.

SITUATION The property is situated within a predominantly industrial area adjacent to the Bankhead Roundabout on the A92 road, approximately 2 miles (3.2km) South of Glenrothes town centre. Access is provided from Woodside Way and surrounding occupiers include a BP Filling Station incorporating an M&S Simply Food, Fife Council’s large Bankhead facility, Eastfield Business Park and Beijing Banquet. The property is located 1.48 miles (2.39 km) south west of the historic Balgonie Castle and 1.97 miles (3.18 km) south east of the vast open spaces of Riverside Park. orth orth ad N ay N rk Ro te W ewa dga N Woo DESCRIPTION th Sou Way ate odg The property comprises a purpose built modern hotel Wo South oad ark R constructed in 2004 and is fitted out to Travelodge’s New corporate style. Internally, the property comprises 50 k Place A92 Newar

bedrooms plus a large lounge/lobby area. The ground W

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Park first and second floors have nineteen bedrooms each plus Bankhead a linen store. Access to the upper floors is by a central

staircase or eight person lift, with an additional two fire B921 stairs at either end of the property. Externally there is a large car park providing 50 car parking spaces. 1 2 9 B Beaufort Drive TENURE Heritable (the Scottish equivalent of Freehold).

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ACCOMMODATION & TENANCY INFORMATION B921 Kinglass

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a t t Tenant Accommodation Rent p.a Lease Start Lease End Unexpired Term Review A v Blackwood Drive e A92 1.11acres (0.45 hectares). nu (Years) e

Travelodge Hotel: 50 rooms, £147,138* 13/12/2004 29/09/2038 19.5 Uncapped RPI Review Hotels Limited Car Park: 50 spaces Dec 2024, Dec 2029, Dec 2034 *Current Rent is £129,665 p.a., rent topped up to the 2019 review based on a RPI increase of 2.5% TWO LONG LET TRAVELODGE INVESTMENTS WITH RPI UPLIFTS

COVENANT

Established in 1985, Travelodge was the first budget hotel brand in the UK. It is now the UK’s second largest independent hotel brand with 30.4% market share of the budget hotel sector. Travelodge current has more than 560 hotels and 40,000 guest bedrooms, right across the UK as well as in Ireland and Spain. In 2012, the business was acquired by Goldman Sachs, Avenue Capital and Golden Tree Asset Management. Following the acquisition, the company has thrived investing approximately £100m in updating, upgrading and incorporating new features to their rooms. In addition, Travelodge has recently successfully refinanced. Travelodge has continued to show strong growth in the budget hotel sector from its published 2018 results. Highlights on the last year’s performance as of Q3 2018 include:

• Revenue up 8.0% to £517.6m (2017: £479.1m) • LFL RevPAR up 3.0% to £41.91 (2017: £40.71) • EBITDA up £5.0m to £97.3m • Increase in occupancy to 78.6% • 10 new openings in the period with a further 5 to date The very strong covenant of Travelodge Limited has a Dun and Bradstreet rating of 5A1and boasts the following figures:

Travelodge 31 Dec 2017 31 Dec 2016 31 Dec 2015 Hotels Ltd Co No: 0769170

Turnover £ 624,000,000 £ 587,700,000 £ 552,100,000

Pre Tax Profit £ 45,200,000 £ 46,800,000 (£ 545,300,000)

Net Assets £ 303,200,000 £ 257,400,000 £ 213,600,000 PRICING Offers are sought in excess of £5,400,000 (Five Million, Four Hundred Thousand Pounds) subject to contract and exclusive of VAT, reflecting an attractive net initial yield of 6.00% assuming purchasers’ costs of 6.13%.

DATAROOM For access to the Allsop dataroom please use the following link: https://datarooms.allsop.co.uk/register/Travelodgesfife

CONTACT For further information or to make arrangements for viewing please contact:

Mark Dansky Ronnie Morgan 020 7543 6813 020 7543 6808 [email protected] [email protected]

allsop.co.uk

Misrepresentation Act: 1. Allsop LLP on its own behalf and on behalf of the vendor/lessor of this property whose agent Allsop LLP is, gives notice that: (a) these particulars do not constitute in whole or in part an offer or contract for sale or lease; (b) none of the statements contained in these particulars as to the property are to be relied on as statements or representations of fact; and (c) the vendor/lessor does not make or give, and neither Allsop LLP nor any of its members or any person in its employment has any authority to make or give, any representation or warranty whatsoever in relation to the property. The only representations, warranties, undertakings and contractual obligations to be given or undertaken by the vendor/lessor are those contained and expressly referred to in the written contract for sale or agreement for lease between the vendor/lessor and a purchaser or tenant. 2. Prospective purchasers or tenants are strongly advised to: (a) satisfy themselves as to the correctness of each statement contained in these particulars; (b) inspect the property and the neighbouring area; (c) ensure that any items expressed to be included are available and in working order; (d) arrange a full structural (and where appropriate environmental) survey of the property; and (e) carry out all necessary searches and enquiries. Allsop is the trading name of Allsop LLP. Design CommandD www.commandHQ.co.uk 03.19