DERBY COLLEGE - THE JOHNSON BUILDING

Locomotive Way | Pride Park | Derby DE24 8PU INVESTMENT SUMMARY

■■ The Johnson Building, part of Derby College, presents itself as a rare opportunity to acquire a modern, purpose built further education college building.

■■ Located on Pride Park, a highly successful mixed used business park in Derby City Centre, home to major occupiers such as Rolls-Royce, Royal Mail and Mercedes Benz.

■■ The property benefits from excellent transport links, located 0.25 miles from Derby Train Station and 8 miles from J25 of the M1.

■■ Long established, Derby College consists of 4 campuses, with The Johnson Building forming part of The Roundhouse Campus.

■■ Purpose-built further education facility totalling 93,190 sq ft, constructed in 2008.

■■ Site area of c. 3.04 acres, which reflects a low site density of c. 47%, with c.125 car parking spaces.

■■ Let to Derby College until 19 October 2029 with 11.9 years unexpired term.

■■ Current passing rent of £848,558 pa (£9.11 psf) subject to a fixed uplift in October 2019 to £960,066 pa (£10.30 psf) and a further 2.5% pa compounded rental uplift in October 2024 to £1,086,229 pa (£11.66 psf).

■■ The vendor will top-up the rent to the fixed uplift in 2019.

■■ Offers are sought in excess of £13,330,000. A purchase at this level reflects an attractive net initial yield of 6.75%, rising to 7.64% at a fixed increase in October 2024, and a capital value of £143 psf.

2 DERBY COLLEGE - THE JOHNSON BUILDING | LOCOMOTIVE WAY | PRIDE PARK | DERBY | DE24 8PU 24 29 6 1 34 23 30 25 4 7 2 5 8 31 3 9 The Johnson Building 11 33 26 21 22 10 14 15 12 16 13 28

27 18 19 32 20 17

1. SNC Lavalin 13. 25. Derby Station 2. Resonate 14. HSBC 26. Royal Mail 3. Software AG 15. Assystem 27. Rolls-Royce 4. Seven Restaurant 16. Chartwell 28. Mercedes Benz 5. Holiday Inn & Harvester 17. Rayburn Tours 29. David Lloyd 6. Pride Veterinary Hospital 18. Business Centre 30. Webhelp 7. Chiquito 19. ISYS 31. Store First Derby 8. Seat 20. U/O David Brown 32. Network Rail 9. VW 21. Pentahotel 33. Ford 10. Mortgage Advice Bureau 22. Derby College 34. Derby County 11. Geldards Law Firm 23. Derby College Football Club 12. Derwent Living 24. Derby College

3 DERBY COLLEGE - THE JOHNSON BUILDING | LOCOMOTIVE WAY | PRIDE PARK | DERBY | DE24 8PU A90 A9

Dundee A85 Perth A90 A85 A85 A92

A816 A82 St. Andrews A9 A91 A84 A915 A92

M90 A83 A91 M9 A82 A915 A811 Stirling A985 Dunfermline

M9 M80 EDINBURGH A1 Greenock Cumbernauld M80 M73 M8 Livingston M8 M8 A1 M74 A78 A71 A68 A702 A737 A775 A83 A701 A7 East Kilbride A721 M77

A72 A697 A71 M74 Kilmarnock A702 A1

A76

A7 A70

A74M A77 A76 A697 A68 A1

A7

A701 A189

A44 A696 A68 N56 A2 Dumfries A74M A75 N13 NEWCASTLE A69 A29 A75 UPON TYNE A6 A26 A75 Carlisle Sunderland

Ballymena A36

A8 A2 N15 A596 A595 M6 Durham A5 A68 Carrickfergus M1 A505 A66 A52 A66 Bangor A1M BELFAST A66 Newtonards A698 A26 A29 A5 Lisburn Comber A66 Middlesbrough A32 A66 Darlington M1 A591 A4 A171 A685 Lurgan A6 A7 A4 A1 A24 A595 M6 A19 A27

A3 A28 N16 A1M A170 Scarborough Isle of N54 A509 Mann N2 N87 A19 A64 A65 A61

Morecambe A59 A166 M6 Harrogate York A614 A1M A1079 A165

N3 A59 A19 E01 N55 Blackpool M55 N2 Bradford M55 Hull N5 A646 Preston Blackburn M62 LOCATION M62 Halifax M62 N63 M3 N51 A6033 A666 A15 Southport M6 M62 M18 N4 M66 Huddersfield M61 Bolton M1 Scunthorpe M180 N55 A565 Oldham Barnsley Doncaster M58 E01 Wigan M18 Grimsby A75 Situated at the heart of Pride Park, The Johnson Building is perfectly positioned to attract A628 M57 N52 M2 A15 A46 M60 those wanting to further their education. Knowsley A1M M3 Rotherham M18 A631 M3 M62 Stockport M3 M3 LIVERPOOL Widnes SHEFFIELD A16 A156 The JohnsonDUBLIN Building is located at the Roundhouse Campus of Derby College within Pride Park. Pride ParkM53 Runcorn M56 A34 A623 N62 is oneN7 of theE01 UK’s most successful mixed use business parks. A number of offi Colwynce, leisure, Bay A55 car showroom A158 A55 A49 M1 N81 A60 N52 and hotel operators are also on the park such as David Lloyd, Derby County Football Club, Rolls-Royce, VW, Chesterfield A614 LINCOLN N80 N7 A470 Chester M6 A1 Mercedes Benz, Holiday Inn and Harvester. A523 A46 A494 A34 A515 A6 A5 A41 A61 CREWE A16 E20 Situated just one mile from the centre of Derby and the Shopping Centre, The Johnson building is A523 A5 Wrexham NEWARK-ON-TRENT E01 A487 STOKE-ON-TRENT perfectly located with excellent connections from the A52 and Junction 25 of the M1 motorway. It is alsoA483 A17 N81 A495 A5 A52 M9 approximately 4 miles south east of Derby train station, which provides a direct link to Sheffi eld, Crewe, NOTTINGHAM A52 M7 A50 A495 A53 A52 Leicester, Nottingham and . Due to these outstanding transport links, Derby College attracts students A148 A494 DERBY N77 A470 M6 N78 from all over the county. N80 A515 A607 A17 A53 STAFFORD A41 A15 N62 A140 A483 A6 M8 A511 A46 E01 A34 A38 A1 A1065 Shrewsbury Loughborough A458 M54 M1 A606 M9 A458 A16 A47 Approximate distances from the property M6TOLL M42 A444 LEICESTER A47 A458 Norwich A470 A483 A47 A134 A1065 N76 Wolverhampton A146 A49 M69 A43 Peterborough A487 Nuneaton Whetstone A141 A11 Derby Train Station 0.25 miles A6 A605 A140 E201 A442 N30 A470 A1M E01 M6 A1065 A44 Yardley A143 Aberystwyth KidderminsterA601 A52 M6 A483 M42 A14 A141 N24 N25 Derby City Centre 1 mile N24 COVENTRY Rugby A45 A14 A456 A134 A487 Redditch Royal A449 Leamington A14 DERBY M5 Spa A14 M1, J25 8 miles M1 Northampton A140 A44 A6 A428 N25 Bury St Edmunds Worcester A423 A44 Stratford-upon-Avon Cambridge A12

Nottingham City Centre 16 miles R A483 IVE A1 A429A6 R M40 DER Bedford A438 WENT A487 A43 A424 Sudbury Ipswich Hereford A46 Derby Station N25 Felixstowe M50 Milton A12 A10 A131 A470 M5 Buckingham M1 A1M A465 Pride Park Keynes M11 Cheltenham A44 A5 Stevenage Derby - Demographics Stanstead A429 Colchester The Johnson BuildingJ9 Bishop A120 A40 A470 Gloucester A34 Stortford A133 A40 A514 St. A12 Aylesbury Monmouth A417 A40 Oxford Albans A418 A41 J8 A10 A465 A6 A414 In 2016 the population of Derbyshire was estimated to be 787,000,Llanelli whilst the population of Derby A48 M5 M40 Chelmsford A449 Cirencester M25 A420 High A413 A12 was estimated to be 254,374. A470 A419 Abingdon Wycombe Watford Enfield M48 A433 Swansea A34 M4 Pontypridd A429 Swindon A127 A5194 Southend-on-Sea Of the total population of Derby, 5.4% are in the 16-19 age group band, which is a higher proportionM4 Newport M4 A406 J15 Maidenhead M25 A130 than the average for England for this age band. M4 Chippenham Reading Slough M4 Heathrow J13 Dartford BRISTOL M25 Marlborough A2 Bracknell Bromley M5 A350 Newbury Wokingham A38 Bath Western- Croydon Sittingbourne A346 Epsom Super-Mare Sutton A28 A37 Woking M2 Basingstoke M3 DERBY COLLEGE - THE JOHNSON BUILDING | LOCOMOTIVE WAY | PRIDE PARK | DERBY | DE24 8PU A34 Farnborough M25 4 Sevenoaks Maidstone M26 Guildford A28 A2 Warminster A21 A361 A24 M23 Andover A303 A229 A31 Gatwick A361 Godalming Barnstaple Crawley Royal A22 M5 A37 A3 Tunbridge Wells A2070 Winchester Folkstone A303 A26 Taunton Salisbury Horsham M3 A361 A358 Shaftsbury A36 A272 A272 A259 Yeovil A350 A354 A21 A338 Southampton A303 A39 M5 M27 Chichester A386 A377 A31 A37 A27 Brighton Portsmouth Bognor Regis Eastbourne A30 A35 A35 Bournemouth A30 Exeter Poole A30 Dorchester

Weymouth

A39 A30 A386

Torquay A38

A38 Newquay Plymouth

A390 DESCRIPTION SITE PLAN

The Johnson Building is a purpose built, further education facility which totals 93,190 sq ft, constructed in 2008.

The building houses a variety of accommodation and facilities which are primarily focussed around vocational training in sport, motor vehicle repairs and construction.

The ground floor includes a large sports hall, gym, dance studio, reprographics room, canteen, two large mechanic workshop facilities, a smaller mechanic garage (open to the public), and a construction workshop. Each of these elements has its own roller-shutter door providing flexibility of use. The first floor offers classrooms, a large IT suite and exam room.

At the front of the building is a large two-storey office block providing a large reception area, kitchen, canteen and board rooms at ground floor, with a large open plan office and further smaller offices at first floor level.

Externally, The Johnson Building has secure car parking areas to the front, side and rear with c. 125 spaces.

*Indicative purposes only

5 DERBY COLLEGE - THE JOHNSON BUILDING | LOCOMOTIVE WAY | PRIDE PARK | DERBY | DE24 8PU ACCOMMODATION

The building contains a variety of accommodation types.

6 DERBY COLLEGE - THE JOHNSON BUILDING | LOCOMOTIVE WAY | PRIDE PARK | DERBY | DE24 8PU TENURE

The property is held freehold.

TENANCY SUB-TENANCY

Let for a further 11.9 years with guaranteed fixed rental uplifts in October 2019 and DHU 111 (East Midlands) CIC have sub-let approximately 27,674 sq ft of The Johnson Building. October 2024. Let on a term of seven years from 24 May 2017 until 23 May 2024 with a break on 23 May 2022. Rent of £217,688 pa (£7.87 psf) with a rent review on 20 October 2019 from which a fixed rental The property is let to Derby College until 19 Oct 2029, currently at a passing rent of £848,558 uplift equivalent to 2.5% pa compounded will apply. pa (£9.11 psf) subject to five-yearly fixed rental uplifts equivalent to 2.5% pa compounded. A service charge is payable. The base service charge is currently £25,333 pa uplifted annually in The next rental uplift is 20 Oct 2019 where the rent reaches £960,066 pa (£10.30 psf) with line with increases in the General Building Cost Index. the final uplift in October 2024 reaching £1,086,229 pa (11.66 psf). DHU 111 provides NHS 111 and Out-of-Hours call centre and medical services for Derbyshire, The vendor will top-up the rent to £960,066 pa. Nottinghamshire, Leicestershire, Rutland and Lincolnshire.

7 DERBY COLLEGE - THE JOHNSON BUILDING | LOCOMOTIVE WAY | PRIDE PARK | DERBY | DE24 8PU DERBY COLLEGE

Derby College is a further education centre which was in established in the 1960s. The Johnson Building principally provides for Derby College mechanics and engineering courses, but also leisure, sports, construction and general learning for approximately 600 full time students. There is close collaboration with surrounding workplaces within Pride Park to offer hands-on experience for the courses which Derby College provide such as at Rolls-Royce and Ford. The college is a member of the prestigious Collab Group of high-performing further-education institutions.

The College is judged as “Good” by Ofsted in all curriculum areas. Its engagement with employers is recognised as outstanding by Ofsted in their inspection report and in the Chief Inspector’s Annual Report published in December 2016.

8 DERBY COLLEGE - THE JOHNSON BUILDING | LOCOMOTIVE WAY | PRIDE PARK | DERBY | DE24 8PU FUNDING & COVENANT

Derby College - Tenant

Derby College operates as a further education college and therefore places considerable reliance on continued government funding. From an income perspective, 77% of the college’s revenue is public funding primarily through the Education Funding Agency (Department for Education) and Skills Funding Agency (Department for Business Innovation & Skills). In reference to fi nancial statements for year ending 31 July 2016, Derby College’s total income for the year was £48,159,000 and total expenditure £51,533,000.

The College is required to complete the annual Finance Record for the Skills Funding Agency and for 2016 the College is deemed to be “Satisfactory” in regards to fi nancial health.

Funding is calculated using a specifi c formula which is driven by student recruitment and includes factors which refl ect student retention, higher cost subjects, disadvantaged students and area costs.

The Further Education sector is currently undergoing change, largely prompted by the obligation for all children to undertake education until 18, formerly 16. The Government is therefore focusing on the Technical and Further Education Bill. 2017 is set to be a hugely signifi cant year for Apprenticeships and Skills as the Apprenticeship Levy comes into force and £2.5 billion is invested in apprenticeships by 2019-20.

DHU 111 (East Midlands) CIC - Sub-Tenant of Part

DHU 111 provides the NHS 111 and Out-of-Hours services for Derbyshire, Nottinghamshire, Northamptonshire, Leicestershire, Leicester, Rutland and Lincolnshire. It is a ‘not-for-profi t’ organisation. DHU 111 is consolidating from several other offi ces around the East Midlands into this facility, which will become its main call centre operation. Approximately 150 staff are due to move in to the offi ce in the coming months in a phased manner.

DHU 111 (East Midlands) CIC was incorporated in 2016 as a subsidiary of DHU Health Care CIC, to support East Midlands NHS 111 calls. The company’s single largest contract was successfully retendered and awarded for a fi ve year term with the possibility of a further two year extension to 30 September 2023. The contract commenced on 27 September 2016.

9 DERBY COLLEGE - THE JOHNSON BUILDING | LOCOMOTIVE WAY | PRIDE PARK | DERBY | DE24 8PU CAPITAL ALLOWANCES Further information available on request. EPC The property is rated C55. Further information available on request. VAT

The property has been elected for VAT. It is proposed that the sale will be treated as a Transfer Of a Going Concern (TOGC). PROPOSAL Offers are sought in excess of £13,330,000. A purchase at this level reflects an attractive net initial yield of 6.75%, rising to 7.64% at fixed uplift in October 2024, and low capital value of £143 psf. Purchasers costs are assumed to be 6.72%. CONTACT For further information or to arrange an inspection, please contact:

John Rodgers Nick Ogden T: 020 3486 3467 T: 020 3486 3469 M: 07810 307422 M: 07825 106681 Conditions under which these particulars are issued: All details in these particulars are given in good faith, but Gerald Eve LLP for themselves [email protected] and the Vendors/Lessors of this property for whom they act give notice that:- 1. These particulars do not and shall not constitute, in whole or in [email protected] part, an offer or a contract or part thereof, and Gerald Eve LLP have no authority to make or enter into any such offer or contract. 2. All statements contained in these particulars are made without acceptance of any liability in negligence or otherwise by Gerald Eve LLP, for themselves or for the Richard Lines Joanna Ireland Vendors/Lessors. 3. None of the statements contained in these particulars is to be relied on as a statement or representation of fact or warranty T: 020 3486 3485 on any matter whatsoever, and intending purchasers must satisfy themselves by whatever means as to the correctness of any statements made T: 020 7333 6274 within these particulars. 4. The Vendors/Lessors do not make, give or imply, nor do Gerald Eve LLP or any person in their employment have any M: 07801 625680 M: 07464 495318 authority to make, give or imply, whether in these particulars or otherwise, any representation or warranty whatsoever in relation to the property. [email protected] [email protected] This statement does not affect any statutory rights you may have nor does it intend to limit Gerald Eve’s liability which cannot be excluded or limited by law. Particulars issued November 2017.

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