STAPLES CORNER SHOPPING PARK

EDGWARE ROAD, , , NW2 6LW

PRIME RETAIL PARK WITH HIGH DENSITY REDEVELOPMENT POTENTIAL SHOPPING PARK | 2

INVESTMENT PROPOSAL SUMMARY We are seeking £22,650,000 (Twenty Two Million Six Hundred and Fifty Thousand Pounds) for our • Staples Corner is an iconic retail park client’s freehold interest, reflecting a net initial location on the corner of the North yield of 6.25%, assuming purchaser’s costs of Circular and Road and 6.75%. This represents a site value of £6.86m per situated within the London Borough acre, well below the £10m+ per acre potentially of Barnet in North London. achievable once the Brent Cross West station has • The property lies directly west of the BRENT CROSS opened and the resulting improvement to the site’s site of the new PTAL rating is implemented. West station which will have a journey MASTERPLAN BOUNDARY time of 15 minutes to (7,000 new homes) once it opens in 2022. • Approximately 7,000 new homes are BRENT CROSS to be built as part of the Brent Cross SHOPPING CENTRE BRENT CROSS FLYOVER South Masterplan. • The property has 1.2m people residing within a 20 minute drivetime and over BRENT SOUTH 2.8m within a 30 minute drivetime. SHOPPING PARK • A modern, high specification retail park totalling 50,553 sq ft of part open A1 food and part open A1 non-food retail, together with 164 car parking spaces. 6) NEW BRENT CROSS • Prominent site totalling 1.34 hectares 40 WEST THAMESLINK A ( STATION AND (3.30 acres) fronting the A5 Edgware D A FOOTBRIDGE SITE O Road with flexibility for alternative uses R R A including residential, industrial, offices L U or student accommodation. C IR C STAPLES CORNER • Total income of £1,510,265 pa at H T RETAIL PARK sustainable rents, securely let with 89% R O let to companies rated Very Low Risk N or Below Average Risk by Experian.

• Potential for high density STAPLES CORNER redevelopment with flexible WAULT SHOPPING PARK to lease expiry of approximately 4.6 years and 2.6 years to breaks. • Potential to secure a McDonalds drive thru on the site. EDGWARE RD (A5) STAPLES CORNER SHOPPING PARK | 3 STAPLES CORNER SHOPPING PARK | 4

BRENT CROSS LOCATION SHOPPING CENTRE Staples Corner is located within the in North London. The nearest conurbations to Staples Corner are Cricklewood and Brent Cross. Staples Corner is located approximately 7 miles north west of Central London, 5 miles east BRENT SOUTH of , 5 miles south of Edgware, 7 miles south west of Barnet SHOPPING PARK and ½ mile west of Brent Cross Shopping Centre.

D (A406) Road communications to Staples Corner are excellent. The A406 LAR ROA H CIRCU North Circular, London’s orbital ring road, is immediately to the north NORT of the subject property and the A5 Edgware Road provides access to the property on its western boundary. The beginning of the is also located at Staples Corner. The M25 motorway is within 15 miles to the north of Staples Corner with the M1 providing STAPLES CORNER access at junctions 6 and 6A to junctions 21 and 21a of the M25. RETAIL PARK

A41 A1

M25

NEW BRENT CROSS A598 WEST THAMESLINK STATION AND M1 BARNET WATFORD A1 ENFIELD FOOTBRIDGE SITE

A10 M25 A41

A406 EDGWARE RD (A5)

BRENT CROSS A1

M40 A40 WEMBLEY STAPLES CORNER SHOPPING PARKA41 A10

A406 STAPLES CORNER LONDON SHOPPING PARK M4

✈ A4 HEATHROW AIRPORT A205

A30 A416 A3 A308 A23 STAPLES CORNER SHOPPING PARK | 5

STRONG & AFFLUENT CATCHMENT DEMOGRAPHICS

According to CACI, the population within a 20 minute drive 20 time of the property min drive is 1,198,052 which rises to 2,823,922 within 30 minutes. Population of 1,198,052 rising to 2,823,992 within 30 mins

The population is also highly affluent. Within the 20 minute drivetime population 66% of households 66% are categorised within the AB or C1 demographic, compared to the AB or C1 demographic national average (above national average) of 53%.

73% of the catchment are classed within the Economically Active above the national 73% average of 71% and the unemployment rate of 2.5% is in line with the UK average Classed Economically Active of 2.3% respectively. (above national average) STAPLES CORNER SHOPPING PARK | 6

BRENT CROSS CRICKLEWOOD – MAJOR GROWTH PROJECT

Staples Corner will benefit schools and around 21 acres M1 significantly from being of improved public realm. BRENT CROSS adjacent to one of the SHOPPING ’s key Brent Cross West Thameslink station is part of the BXC CENTRE growth projects, Brent Cross BRENT CROSS Cricklewood (BXC). This is Masterplan’sA598 improved M an area of 370 acres, is the transport infrastructure and D will see the brand new Brent A biggest redevelopment and O R Cross West Thameslink station R growth programme Barnet LA link to Central London in under CU Council has ever undertaken CIR RTH and it is named a key 15 minutes, provide direct rail NO growth project by the Mayor services to Luton and Gatwick airports, and connect with of London. NEW STATION the wider London transport BRENT CROSS WEST With construction beginning network. We understand AD RO this year, the two main aspects the Flip Out unit car park, LAR R CU of the BXC Masterplan are forming part of Staples H CI ORT to take place at Brent Cross Corner Retail Park, is subject N South and Brent Cross West to a Compulsory Purchase A41 Thameslink station. Order from the council and E H the site will form part of the DRIV ENDO Brent Cross South will be a western entrance to the PENNINE N new mixed-use town centre station directly to the east of STAPLES CORNER WA SHOPPING PARK including some 7,000 new the subject property. A new Y D homes, office space for footbridge over the station D A ROA approximately 20,000 new EST A5 CR is to be part of the new CR jobs, rebuilding three existing access arrangements. ICKLEWOOD

NCHLEY RO I F

B RO E ADWA LAN

LLIS HILL Y DO E LAN EWOOD CRICKL

BRENT CROSS BRENT SOUTH CRICKLEWOOD BRENT CROSS WEST STAPLES CORNER SHOPPING PARK | 7

RETAIL WAREHOUSING IN THE STAPLES CORNER AREA The subject property comprises the southern section of the dominant retail warehousing in Staples Corner, which has three retail parks in total amounting to 285,000 sq ft.

Within the immediate Staples Corner location the subject property incorporates the only open A1 food space. The adjacent Staples Corner Retail Park is restricted to bulky goods retail. Rents on this park are mostly between £30 - £35 psf including the larger 20,000 sq ft stores. Tenants include Dunelm, Smyths Toys, Currys/PC World, SCS, Carpetright and Dreams.

Brent South Shopping Park to the east of the property, on the north circular, totals 94,000 sq ft with a mixture of open A1 non food and bulky retailers. Recent lettings on this asset have rebased rents from approximately £60 psf to £40 - £45 psf, and from £45 psf to £32.50 psf to £35 psf. Tenants include Next, TK Maxx, Sofology, Sports Direct, DFS, Oak Furnitureland, Tapi and Natuzzi.

Brent Cross Shopping Centre, whilst concentrating on fashion and department store retailers, provides a huge draw to the area. The centre attracts some 13 million people annually and at over 900,000 sq ft boasts anchor tenants Fenwick, John Lewis and M&S alongside the likes of Zara, Apple and Boots.

On the east side of Brent South Shopping Park is a Tesco and a former Toys R Us unit which we understand has been bought by Argent who is Barnet Council’s development partner for Brent Cross South and is likely to be redeveloped for other uses.

To the south at Cricklewood, there are three retail warehouse units let to B&Q, Wickes and Matalan. B&Q was owner occupied until recently and Wickes (37,000 sq ft) and Matalan (34,000 sq ft) are let in the region of £21-£22 psf.

The B&Q was sold in March 2019 for mixed-use residential redevelopment at £45m / £6.6m per acre and we understand the Matalan site was sold to a residential developer in 2016 at £21.75m / £9.7m per acre. STAPLES CORNER SHOPPING PARK | 8

THE FUTURE OF LONDON RETAIL WAREHOUSING – SUPPLY UNDER THREAT Over the past few years Greater London retail are among many more examples of the decline of The Wickes site in Cricklewood also looks a likely warehousing has been highly sought after by retail warehousing in the capital. This reduction residential conversion. investor developers and alternative use specialists. of retailer representation in London is putting It is now common for residential or industrial values their core market under considerable strain and is In summary, should the subject property continue to exceed those of retail warehousing in their likely to create competition for, and upward rental in its current use as an already successful trading existing use. As a result we have seen a persistent pressure on, the diminishing supply of successful retail park the demise of other retail parks close reduction in the number of retail parks across retail schemes. by should result in increased competition for space London over the last 5 years or so. and subsequent rental growth. Meanwhile, the In the Staples Corner / Brent Cross area specifically, completion of Brent Cross West station in 2022 This activity, illustrated by the likes of the B&Q and we have already seen the former Toys R Us, B&Q and (and associated improvements in the property’s Matalan sales in Cricklewood, Wickes in , Matalan units sold off for development purposes, PTAL rating) offers up the opportunity to Barking and , Homebase in , and we believe it likely that Brent South Shopping repurpose the site for high density residential Richmond and Walton on the Hill, Stone Lake Retail Park will be drawn into the Brent South residential (or other) development, further intensifying the Park in , Pentavia Retail Park in , plans given its allocation for up to 34-storey pressure on retailers’ representation in the wider and Hurlingham Retail Park and B&Q in residential towers. Staples Corner area.

A406

r a l A4006 u c r i

C

h t r o N A41 6 0 4 A SILK BRIDGE RETAIL CENTRE M1

BRENT CROSS A502 SHOPPING CENTRE r A5 la u c ir C h t r o N 06 AA4064

STAPLES CORNER RETAIL PARK BRENT SOUTH A41 SHOPPING PARK STAPLES CORNER

SHOPPING PARK lar rcu Ci th or N 6 0 4 A A5

MATALAN WICKES B&Q

GLADSTONE PARK STAPLES CORNER SHOPPING PARK | 9 STAPLES CORNER SHOPPING PARK | 10

SITUATION Staples Corner is highly visible and prominently situated at the junction of the A5 Edgware Road and the A406 North Circular, close to the start of the M1 Motorway. The A5 is the main arterial road leading north out of London from Marble Arch.

NEW BRENT CROSS Two customer entrances are provided to the scheme from Geron WEST THAMESLINK Way, which is accessed via a slip road on Edgware Road. Access to STATION AND the adjoining Staples Corner Retail Park is also from Geron Way. FOOTBRIDGE SITE Customers can also enter the retail park from the Edgware Road.

The locality is also a highly successful commercial area with trade occupiers as well as retailers competing for representation here. Staples Corner Business Park is home to brands such as Screwfix, Magnet, Topps Tiles, Tool Station, Travis Perkins, Safestore, Big Yellow and a new Jaguar Land Rover dealership.

DESCRIPTION The property comprises 5 retail warehouse units across two separate terraces plus a single stand-alone unit. The scheme was refurbished and redeveloped in 2009. The park totals 50,553 sq ft of part open A1 food and part open A1 non-food retail.

All units have mezzanine trading floors, although Argos’s mezzanine is used as storage. The car park includes 164 car parking spaces providing a ratio of 1:308 sq ft.

The site area is approximately 1.34 hectares (3.30 acres).

EDGWARE ROAD (A5) GERON WAY TENURE UNDER OFFER Freehold. TO MCDONALDS (SUBJECT TO PLANNING) H NO RT

For indicative purposes only. STAPLES CORNER SHOPPING PARK | 11

LEADING TENANT SECURE INCOME LINE UP PROFILE The property is let to a strong mix of The scheme is let to a strong and diverse mix of 75% 14% retailers producing a total current net national multiple retailers, the majority of which income of £1,510,265 per annum, with an are market leaders in their sectors of the market. average weighted lease term of 4.6 years 75% of the annual income is secured against to expiries and 2.6 years to breaks with the covenants with Experian’s best rating of Very VERY LOW RISK BELOW AVERAGE longest lease expiring in December 2027. Low Risk and 14% against Below Average risk. COVENANTS RISK COVENANTS

AREA LEASE LEASE LEASE NEXT PASSING RENT EXPERIAN UNIT TENANT COMMENTS (GIA SQ FT) START EXPIRY BREAK REVIEW RENT (pa) (psf) RATING

2019 rent review outstanding. Review capped at £488,629 pa. A 11,872 6/7/2009 5/7/2024 - 6/7/2019 £346,376 £29.18 Very Low Risk Assumed floor area at review of 11,934 sq ft. Argos Ltd

Rent deferment period for 24 Jun-28 Sep to be paid back in 12 monthly instalments B 12,162 30/11/2012 25/12/2027 25/12/2022 25/12/2022 £375,000 £30.83 Very Low Risk (£7,813 per month) from 1 Feb 2021. S/C cap £26,833 (no current shortfall). TJX UK

Vacant (U/O to McDonalds) - Subject to drive-thru planning and £500k build cost: offer from McDonalds C 4,199 - - - - £150,000 £35.72 - 12 months rent, rates and service for 25 year lease at £150,000 pa, 3 months rent free. charge guarantee

D1 7,407 24/6/2011 23/6/2026 24/6/2022 24/6/2021 £192,889 £26.04 Below Average Risk Assigned from Hobbycraft in 2017 with £400k premium.

Decathlon UK Ltd

Rent deferment period for 1 May-31 Aug to be paid back in 12 monthly D2 9,938 3/9/2012 2/9/2022 - - £296,000 £29.78 Very Low Risk instalments of £8,222.22 per month from 1 October 2020. S/C cap £21,839 (no shortfall). Wren Kitchens Ltd

As part of Bensons pre-pack discussions, T offered new 10 year lease (5 yr TBO) (Mutual at £120k plus 10-12 months rent free. Counter LL offer of £150k, 3 months rent free, Sept 2020 Sept 2023 D3 4,975 rolling after - £150,000 £30.15 TBC 5 yr mutual break. LL has agreed to a flexible 3 year lease with mutual rolling breaks (TBC) (TBC) 12 months) after 12 months at £75,000 pa to allow for future purchaser preferences. Landlord Bensons for Beds Retail Ltd to top up the rent for a period of 12 months to £150,000 pa.

Total 50,533 £1,510,265 STAPLES CORNER SHOPPING PARK | 12

GERON WAY EXISTING USE ASSET MANAGEMENT

POTENTIAL NORTH -A-

IMMEDIATE:

O

P

S

C

U

P

B

O

A R Reconfigure Unit C to a drive-thru restaurant D unit. Terms are agreed with McDonalds for a

1

2

3 4

5 6

7 25 year lease at £150,000 pa with 3 months 8 9 10

11 12 rent free. Approximate conversion costs of £500k. Subject to planning.

e.j. e .j.

e .j. e. j. MEDIUM TERM: EDGWARE ROAD (A5) e.j. UNDERe.j. Utilise the food retail permission across units

e. OFFERj. e. e.j j. .

e GERON WAY .j.

D1, D2 and D3 by amalgamating the units.

e

(SUBJECT TO PLANNING) .

j.

e

.j. e .j Alternatively, keep the shorter lease length . e.j. e .j. e.j flexibility to take advantage of relocating .

e.j e .j. .

e e. .j retailers evicted from nearby retail park j. .

e. redevelopments. j. e.j . e.j.

e.j .

e .j. Please note that some leases have the benefit e.j. e.j.

of protected no build zones across parts of the 1 e .j.

e e.j .j. car park and minimum car parking definitions. .

e Further details can be provided upon request. .j. e. e.j. j.

e e .j. .j.

e.j. e.j. For indicative purposes only.

e.j.

e. j.

e.j.

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UNIT A e. j. 1,109sq.m (11,937 sq.ft FFL 45.975

e. j.

)

e.j . STAPLES CORNER SHOPPING PARK | 13 STAPLES CORNER SHOPPING PARK | 14

RESIDENTIAL PLANNING PLANNING REVIEW Units A, B and C have an open The site is identified in the Brent Local Plan and London In partnership with Gensler architects, Montagu Evans A1 non-food retail permission. Plan as falling within the Cricklewood Opportunity Area. have been instructed to assess the site’s redevelopment In the Council’s Tall Buildings Update 2019 document, value for residential use. The Gensler scheme below Units D1, D2 and D3 have an open the Property is identified in an area of existing/proposed demonstrates the viability of a residential scheme with A1 (including food) retail permission. tall buildings (up to 30 storeys), one of five clusters elements of up to 20 storeys and an indicative total along the A5 Edgware Road for tall buildings and with residential Net Sales Area of c775,000 sq ft. After Copies of relevant planning an indicative range in building heights of 8-28 storeys. allowing for affordable housing provision at 35%, and permissions can be provided In the emerging Development Plan, Policy GSS02 relates a 10% regeneration premium, this would indicate a upon request. to Brent Cross West which specifically includes the potential residential Gross Development Value of £450m Property. At least 1,800 new homes are proposed, to £475m, reflecting £740 - £770 psf for the private sales. with residential development to be directed towards the area around the new Brent Cross West station. Further information is available upon request. STAPLES CORNER SHOPPING PARK | 15

ENVIRONMENTAL Delta Simons have undertaken a Phase 1 Environmental Audit and this will be available to assign, the report concludes a Low Environmental Risk for continued use as a retail park.

VAT The property has been elected for VAT and it is anticipated that the sale will be structured as a Transfer of a Going Concern (TOGC).

EPCs EPCs are available on request.

DATAROOM A dataroom is available with supporting information and documents.

PROPOSAL We are seeking £22,650,000 (Twenty Two Million Six Hundred and Fifty Thousand Pounds) for our client’s freehold interest, reflecting a net initial yield of 6.25%, assuming purchaser’s costs of 6.75%. This represents a site value of £6.86m per acre, well below the £10m+ per acre potentially achievable once the Brent Cross West station has opened and the resulting improvement to the site’s PTAL rating is implemented. STAPLES CORNER CONTACTS Jonathan Perkins SHOPPING T 020 7317 3744 M 07884 186881 PARK E [email protected]

Will Andrews T 020 7317 3741 M 07970 467 505 E [email protected]

MISREPRESENTATION ACT: KLM Retail LLP and KLM Out of Town Retail & Leisure Ltd, for themselves and for the vendors of this property, whose agents they are, give notice that (i) the particulars and any further information communicated by any means to potential purchasers of the property described in the particulars, or their advisers, in connection with the possible sale of the property are provided solely for the purpose of assisting potential purchasers in deciding whether they wish to proceed with further investigation of the property and do not constitute either the whole or any part of an invitation, offer or contract for sale of the property; (ii) all descriptions, dimensions, references to condition and necessary permissions for use and occupation and other details are given in good faith and are believed to be correct as at the date of the particulars (or the date of the relevant information if earlier). However, EDGWARE ROAD, potential purchasers are not entitled to rely on them as statements or representations of fact but should satisfy themselves by searches, enquiries, surveys and inspections or otherwise with regard to the accuracy of such details. No responsibility or liability is or will be accepted by KLM Retail LLP and KLM Out of Town Retail & Leisure Ltd, the vendor(s) of the property BRENT CROSS, or any of their respective subsidiaries, affiliates, directors, officers, representatives, employees, advisors, or agents for any loss or damage suffered by any party, resulting from reliance on the particulars or any other information communicated by any means to that party, or its advisers, in connection with the possible sale of the property. No person in the employment CRICKLEWOOD, of KLM Retail LLP, KLM Out of Town Retail & Leisure Ltd or the vendor(s) has authority to make or give any representation or warranty, express or implied, in relation to the property. References to KLM Retail and KLM Out of Town Retail Ltd include any joint agents acting with KLM Retail LLP and KLM Out of Town Retail & Leisure Ltd. September 2020. LONDON NW2 6LW