111 Princes Street Edinburgh
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111 PRINCES STREET EDINBURGH PRIME RETAIL INVESTMENT INVESTMENT SUMMARY Edinburgh is Scotland’s Edinburgh has a Strong occupier capital city and catchment spend of demand and Europe’s fourth largest increasing prime financial centre £2.56BN rental tone Let to Current income of 100% Prime retail opportunity £528,000PA until January 2025 Absolute Ownership Offers in excess of 5.25% NIY £9,470,000 after allowing for (Scottish equivalent purchaser’s costs of English freehold) 2 Cushman & Wakefield 111 Princes Street, Edinburgh EDINBURGH IS SCOTLAND’S 486K CAPITAL CITY & THE SEAT OF Population of 486,000, predicted to grow to over SCOTLAND’S 600,000 people by 2033 GOVERNMENT 4M VISITORS PER YEAR Tourist expenditure £334 per visitor 12M M PEOPPL PER YEAR 1.6 Princes Street had Regional catchment SHOT the highest footfall of 1.6M people in Edinburgh 4 Cushman & Wakefield 111 Princes Street, Edinburgh The 2nd most 51% tech savvy +4M city in the UK 51% of Edinburgh’s population according to hold a degree or professional level Google eTown UNESCO World Heritage Site qualification, providing a highly Awards attracting over 4M visitors per year educated population 4 Most visited tourist destination outside UNIVERSITIES of London Make Edinburgh the most popular destination for overseas students wishing to study at UK universities, after London 12M 37% 37% more affluent achievers than the Scottish average Cushman & Wakefield 111 Princes Street, Edinburgh 5 EDINBURGH IS ONE OF THE STRONGEST RETAILING CENTRES IN THE UK, DOMINATING 111 Jenners ITS CATCHMENT OF PRINCES STREET 1.6M PEOPLE WAVERLEY MALL Princes Street George Street Lothian Road Tram line Waverley Station PRINCES STREET GEORGE STREET MULTREES WALK Princes Street is the prime retailing thoroughfare, George Street provides a unique blend of retail and Anchored by Scotland’s only Harvey Nichols attracting an excellent blend of retailers. leisure uses. In recent years the street has become store, Multrees Walk is home to up-market known for being home to a number of high quality and luxury brands. Major retailers present: House of Fraser, retailers, along with trendy bars and restaurants. Debenhams, Marks & Spencer, Next, H&M, Major retailers present: Harvey Nichols, Top Shop/Top Man, Primark Major retailers present: Jaeger, Anthropologie, Louis Vuitton, Emporio Armani, Mulberry, Hollister, Hobbs, The White Company, White Stuff, Replay, Reiss, Tesla Prime Zone A rates: £240 per sq ft Space NK, LK Bennett, Aspinal of London, Kuoni Prime Zone A rates: £200 per sq ft 8 Cushman & Wakefield 111 Princes Street, Edinburgh E VOLVING RENTAL GROWTH CITY As the catchment spend available is increasing, In the last 12 months there has been a significant increase in activity on Princes Street with eight new the city centre is evolving as a retail destination. lettings in 2016. Footlocker and Ann Summers have relocated and upsized on the street. This increase in A significant part of this evolution is the demand for space on Princes Street has seen rental levels grow up to 20%, with further upward pressure. £850 million redevelopment of the St James There is a dearth of space available in Edinburgh city centre which has shifted the balance of power in Centre. The new centre will deliver 1.7 million favour of the landlord. We have also seen relatively low rent free periods being negotiated and in most cases sq ft of retail, hotel, leisure and residential straight ten year leases. A selection of recent transactions are noted below. accommodation. The development is due to complete post 2020. PRINCES STREET TENANT ZONE A RATE COMMENT The new St James Centre will heighten 10 year lease, break option year 5 Edinburgh’s appeal as a major UK retail 10/15 Foot Locker £199 New prime rental tone for this parade destination. 42a Smiggle £248 10 year lease NEW ENTRANTS 87 Ann Summers £247 10 year lease 89 Burger King £52 (GIA) 20 year lease, break option year 15 94 Kiko £284 10 year lease 20 year lease 97a/98 Chisholm Hunter £174 High global rent relative to ground floor footprint 15 year lease 119 H Samuel £221 New prime rental tone for this parade 119 Card Factory £160 5 year lease Cushman & Wakefield 111 Princes Street, Edinburgh 9 LAINGS THE JEWELLER THE LE CREUSET BADGER B CO ETEAKET PRETTY GREEN MENSWEAR UNDER OFFER TACO MUZMATACO PRINCES STREET SITUATION The subject block is 100% prime and accommodates some of the best brands on the street including Debenhams, Boots, Zara and Next. Recent additions to this pitch include Vodafone and Swiss watch brand Swatch. 10 Cushman & Wakefield 111 Princes Street, Edinburgh DESCRIPTION An attractive Grade B Listed building arranged over ground and basement, first and second levels. River Island trades from both ground and basement levels. The subjects have been measured on a net internal basis in accordance with the RICS Code of Measuring Practice (6th Edition) and approximate areas are as follows: AREA SQ M SQ FT Ground floor 390.56 4,204 Basement 377.46 4,063 First 175.03 1,884 Second 193.24 2,080 Total area 1,133.79 12,204 ITZA 233.56 2,514 Cushman & Wakefield 111 Princes Street, Edinburgh 11 TENANCY The entire property is let to River Island until 26th January 2025, the lease was recently extended. The rent is £528,000 per annum, reflecting a Zone A of £210 per sq ft. The rent reviews are on 28th November 2017 and 28th November 2022. TENANT COVENANT River Island is one of the most recognised high street fashion brands in the United Kingdom, with 248 stores in the UK and a further 76 in other global markets including, Europe, the Middle East, Africa and South America. River Island Clothing Co Limited (00636095) is rated by Experian as ‘very low risk’ with a score of 98. DATE TURNOVER (£s) PRE-TAX PROFIT (£s)’S) NET WORTH (£s) 29/12/2012 739,700,000 93,300,000 268,700,000 28/12/2013 809,500,000 86,100,000 242,700,000 27/12/2014 890,400,000 145,800,000 279,600,000 12 Cushman & Wakefield 111 Princes Street, Edinburgh TENURE The property is held Absolute Ownership (Scottish equivalent of English freehold). EPC The rating of the unit is E and the CO2 emissions are 67.27 kgCO2 per m2 per year. A full EPC can be provided upon request. VAT The property has been elected for VAT and therefore VAT will be payable on the purchase price. However, it is anticipated that the sale will be treated as a Transfer Of A Going Concern (TOGC). Cushman & Wakefield 111 Princes Street, Edinburgh 13 PROPOSAL We are instructed to seek offers in excess of £9,470,000 (Nine Million Four Hundred & Seventy Thousand Pounds Sterling) subject to contract and exclusive of VAT for the Absolute Ownership. A purchase at this level would reflect a net initial yield of 5.25% after allowing for purchaser’s costs of 6.20% based on Scotland’s Land and Buildings Transaction Tax (LBTT). FOR VIEWINGS & ENQUIRIES: Stephen Bibby Sam Waterworth Tel: +44 (0) 131 222 4523 Tel: +44 (0) 207 152 5149 Email: [email protected] Email: [email protected] Sarah Stewart Erin Mills Tel: +44 (0) 131 222 4524 Tel: +44 (0) 131 222 4564 Email: [email protected] Email: [email protected] MISREPRESENTATION ACT Cushman and Wakefield LLP (and any joint agent appointed) on their own behalf and for vendors or lessors of this property, whose agents they are, give notice that: (i) These particulars are produced in good faith, but are a general guide only and do not constitute any part of a contract and must not be relied upon as statements or representations of fact. (ii) No person in the employment of the agent(s) has any authority to make or give representation or warranty whatever in relation to this property. (iii) the property is offered subject to contract and unless otherwise stated all rents and outgoings are stated exclusive of VAT (iv) Floor areas, measurements or distances given are approximate (v) Nothing in these particulars should be deemed a statement that the property is in good condition, or that any services or facilities are in working order. (vi) Unless otherwise stated, no investigations have been made regarding pollution, or potential land, air or water contamination. Interested parties are advised to carry out their own investigations as required. February 2017. .