BBC TV Studio & COLLEGE OF MUSIC BBC , 2 St Peters Square, Leeds, LS9 8AH

Long Income Investment 16.5 Year WAULT BBC TV Studio & LEEDS COLLEGE OF MUSIC BBC Broadcasting House, 2 St Peters Square, Leeds, LS9 8AH

Investment Summary

Location

Situation

Communications Investment Summary

Property Overview • Modern 4 Storey Office, TV Studio, Radio Station & Music Auditorium Tenure • Prominent location on the eastern fringe Tenancy of the city centre. • Fully occupied by and leased to the Lease Summary BBC & Leeds College of Music

Regeared Lease • WAULT – 16.5 years • NIA 36,945 sq ft Salient Lease Points • Passing rent of £474,641 per annum - £12.84psf

The BBC

BBC Yorkshire & Leeds College of Music Proposal Capital Allowances & VAT • Offers invited in excess of £8,500,000 reflecting Proposal a Net Initial Yield of 5.23% • Low capital value of £230 per sq ft. Contact Details

2. BBC TV Studio & LEEDS COLLEGE OF MUSIC BBC Broadcasting House, 2 St Peters Square, Leeds, LS9 8AH

Investment Summary Location Situation Location Leeds - a key city in Yorkshire and the largest legal The property itself is situated in Quarry Hill and fronting central squares, Centenary Square and St Peters Square Situation and financial centre in the UK after London. on to St Peters Place (A61) and St Peters Square, a and the area is now known as the ‘Arts quarter’ as it is prominent location on the eastern fringe of Leeds City home to Playhouse, BBC Yorkshire, Leeds Centre. Quarry Hill has been the focus of substantial College of Music campus and ‘The Wardrobe’. Communications regeneration which began back in the early 1990’s. The development of the area has taken place around two Property Overview

Tenure Woodhouse Lane St Mary’s Street A58(M) Tenancy A61

Regent Street Kirkstall Road Lease Summary A64(M) Merrion Street A64(M) The Property Beckett Street Burley Road Eastgate

Mabgate

Regeared Lease Burley Street Marsh Lane The Headrow Eastgate Salient Lease Points A64(M) A61 Wellington Street The BBC LEEDS Marsh Lane Canal Street

Kirkgate BBC Yorkshire & LeedsStation Railway Dyer Street Duke St Leeds College of Music The Calls Capital Allowances A61 BBC St Cecilia St & VAT Marsh Lane Water Lane St Peters Square Proposal

Contact Details St A643 York St

Kirkgate Marsh LaneSaxton Lane A61 3. A61

3 3 Kirkgate A621 A621 Marsh Lane BBC TV Studio & LEEDS COLLEGE OF MUSIC BBC Broadcasting House, 2 St Peters Square, Leeds, LS9 8AH

Investment Summary 11. BBC Yorkshire & LCM 44. The Merrion Centre 77. Victoria Gate 107. Corn Exchange 22. Leeds Train Station 55. The Light 88. Quarry House - Department of Health Location 33. Trinity Shopping Centre 66. First Direct Arena 99. West Yorshire Playhouse

Situation

Communications

Property Overview

Tenure

Tenancy

Lease Summary 4 5 6 Regeared Lease

Eastgate 3 Salient Lease Points 2

The BBC 10 7 BBC Yorkshire & Leeds College of Music Regent Street Capital Allowances Kirkgate 9 & VAT Duke Street Proposal 1 8 Contact Details Crown Point Road York Street A64(M)

Marsh Lane

4. Black Bull Street BBC TV Studio & LEEDS COLLEGE OF MUSIC BBC Broadcasting House, 2 St Peters Square, Leeds, LS9 8AH

Investment Summary Communications Location A1(M)

Situation Leeds by Car NEWCASTLE UPON-TYNE Communications London 3 Hours 45 Mins Via M1 SUNDERLAND MIDDLESBROUGH Property Overview Edinburgh 3 Hours 55 Mins Via A1

Manchester 1 Hours 15 Mins Via M62 A1(M)

Tenure M6 LEEDS Birmingham 2 Hours 05 Mins Via M1 AIRPORT

LEEDS HULL Tenancy BLACKPOOL M62 M82 M1 M180 LIVERPOOL Lease Summary Leeds by Rail M60 M58 MANCHESTER AIRPORT M53 M1 Regeared Lease London 2 Hours 15 Mins M8 NOTTINGHAM

A1M EAST Edinburgh 3 Hour 00 Mins MIDLANDS NORWICH Salient Lease Points M54 AIRPORT Manchester 0 Hours 50 Mins M68 BIRMINGHAM M8 BIRMINGHAM INTERNATIONAL AIRPORT The BBC Birmingham 1 Hours 50 Mins M42 M40 M11

M5 M1 A1M COLCHESTER BBC Yorkshire & LUTON AIRPORT SOUTHEND Leeds College of Music -0N-SEA STANSTED SWANSEA M4 AIRPORT GLOUCESTER M40 M25 Capital Allowances M1A Leeds by Aeroplane CARDIFF LONDON & VAT M4 M4 M4 HEATHROW BRISTOL AIRPORT

M25 M20 M2 Leeds Bradford Airport - less than 10 miles from the subject property M3 Proposal GATWICK and the 15th busiest airport in the UK. AIRPORT

M5 M27 Contact Details SOUTHAMPTON Number of Airlines - 11 EXETER Number of Passengers - 3.6m (2016 – increase of 4.6% on 2015) PLYMOUTH

5. BBC TV Studio & LEEDS COLLEGE OF MUSIC BBC Broadcasting House, 2 St Peters Square, Leeds, LS9 8AH

Investment Summary Property Overview Tenure Location A modern purpose built four storey property constructed to the highest standards Basis Long Leasehold Situation to represent the regional Broadcasting Centre and headquarters of BBC Yorkshire. Completed in July 2003, the building is a four-storey broadcasting centre including Rent Peppercorn offices, studios/production area and restaurant for the BBC. There is also a separate Term 125 years from 27 March 2003 (110 unexpired) Communications Auditorium with a seating capacity of 350 persons and roof top venue space for Freeholder the Leeds College of Music on the third/fourth floors. Property Overview Blue denotes BBC & LCM demise. Demise Red denotes total LLH demise. The property sits on a 0.66 acre site and also has the benefit of 12 parking spaces. Tenure

Tenancy

Lease Summary Tenancy

Regeared Lease The property is fully let on three leases as follows:

Salient Lease Points Lease Unexpired Next Floor/Demise Tenant Size (sq ft) Expiry Term Review Review Basis Rent (£) 86.6% of OMV for offices off an assumed area of 19,674sq ft. Before The BBC British lease regear the passing rent was £356,328. It is against this rent that the review is calculated and then the £42,930 per annum deduction is Ground/1/2/3 Broadcasting 23,154 30/01/2032 14 Years 24/03/2018 313,398 BBC Yorkshire & subequently made. The rent review would therefore look as follows: Leeds College of Music Corporation 19,674sqft X ERV (£22.00psf) = £541,035 X 86.6% = £468,536 minus £42,930 = £348,936. Capital Allowances & VAT British 86.6% of OMV for retail off an assumed area of 5,866sq ft. Before Broadcasting lease regear the passing rent was £84,884. It is against this rent that Corporation the review is calculated and then the £10,070 per annum deduction is Proposal Restaurant 5,812 30/01/2032 14 Years 24/03/2018 73,814 (Trading as subequently made. The rent review would therefore look as follows: Aaghar Indian 5,866sqft X ERV (£17.50psf) = £102,655 X 86.6% = £88,899 minus £10,070 Contact Details Restaurant) = £78,829. Therefore nil increase. Leeds College Leeds College of Music of Music 7,979 18/10/2047 29.6 Years 18/10/2022 2% per annum compounded - reviewed 5 yearly. 87,429

36,945 474,641 6. BBC TV Studio & LEEDS COLLEGE OF MUSIC BBC Broadcasting House, 2 St Peters Square, Leeds, LS9 8AH

Investment Summary BBC Lease Commentary Salient Lease Points Location The original lease has recently been regeared following an approach from the BBC 1954 Act Inside the Act Situation due to their continued commitment to the building. Rent Review Time not of the essence Original passing rent £440,212 per annum (£15.20psf) Assignment Communications Assignment of part not permitted. Assignment of the Lease Expiry 24/03/2028 whole permitted subject to Landlord Consent, not to be unreasonably withheld and subject to the Tenant entering Property Overview Lease Break 24/03/2021 into an Authorised Guarantee Agreement. Rent Review 24/03/2018 – Alienation Tenure (as summarized in the previous page table) The Landlord may also require, where reasonable, that the Assignee procure a guarantor.

Tenancy Subletting Subletting of whole or part permitted subject to LL Regeared Lease - BBC consent and subject to compliance with certain conditions, Lease Summary not to be unreasonable withheld.

Regeared Lease The lease break has been removed and a reversionary lease put in place.

Salient Lease Points years term 14 certain Regeared Lease - Leeds College of Music The BBC (expiring 30/01/2032) LCM have entered into a new 30 year lease in exchange for the landlord building BBC Yorkshire & a new venue area on the roof. Leeds College of Music The incentive is an annual rent reduction of £53,000, which has been calculated as the BBC marriage value share divided by the 15 years and applied annually. Capital Allowances & VAT years term Day one rent receivable certain Proposal 29.5 per (expiring 15/09/2047) £ £387,212 annum Contact Details - 2% per annum compounded reviews At the rent reviews, the £53k deduction is made subsequently, but at all times the - 5 yearly rent is upwards only.

7. BBC TV Studio & LEEDS COLLEGE OF MUSIC BBC Broadcasting House, 2 St Peters Square, Leeds, LS9 8AH

Investment Summary The BBC Location The British Broadcasting Corporation (BBC) is a British British Government, agreed by Parliament, and used to (2016: £335 million). Cash generated from operations has Situation public service broadcaster headquartered at Broadcasting fund the BBC’s radio, TV, and online services covering been offset by a £220 million pension deficit payment House in London. The BBC is the world’s oldest national the nations and regions of the UK. Since 1 April 2014, made in March 2017. The current strong financial position broadcasting organisation and the largest broadcaster in it has also funded the BBC World Service (launched in of the BBC, along with the successful delivery of recent Communications the world by number of employees. 1932 as the BBC Empire Service), which broadcasts in 28 saving plans, leaves the Corporation in a good position to languages and provides comprehensive TV, radio, and meet its future obligations (which include pension deficit Property Overview The BBC is established under a Royal Charter and online services in Arabic and Persian. repayments) and to continue delivering world-class operates under its Agreement with the Secretary of State content to its audiences. Tenure for Culture, Media and Sport. Its work is funded principally Around a quarter of BBC revenues come from its by an annual television licence fee which is charged to all commercial arm BBC Worldwide Ltd, which sells BBC The BBC has been focusing on cost savings and delivered Tenancy British households, companies, and organisations using programmes and services internationally and also an annual saving of £81m in 2016/17. Property is critical any type of equipment to receive or record live television distributes the BBC’s international 24-hour English- to this, and the subject property was one such example Lease Summary broadcasts and iPlayer catch-up. The fee is set by the language news services BBC World News, and from BBC. where the BBC have identified key buildings where they com, provided by BBC Global News Ltd. see long term requirements and seek to reduce rents in Staff The BBC’s cash balance at the end of the year is £256 return for longer lease terms. Regeared Lease (inc part-time, flexible 35,402 & fixed contract) million, which is a £79 million reduction from prior year Salient Lease Points

The BBC

BBC Yorkshire & Leeds College of Music Capital Allowances & VAT

Proposal

Contact Details

8. BBC TV Studio & LEEDS COLLEGE OF MUSIC BBC Broadcasting House, 2 St Peters Square, Leeds, LS9 8AH

Investment Summary BBC Yorkshire Location The property is the Head Office for BBC Yorkshire which Church, where the service was based until 1974. From Yorkshire’s Leeds-based facilities moved to the building, Situation began television broadcasting in 1968, following the then, the television service moved into Old Broadcasting located in St. Peter’s Square at Quarry Hill, which included separation of the region from the Manchester based BBC House at Woodhouse Lane, Leeds, where some services state-of-the-art computer systems, new digital studios North. such as BBC Radio Leeds had already been broadcasting. for BBC Radio Leeds, and new technology that allowed Communications the programme to be broadcast in widescreen. The first Leeds base for BBC North, upon the launch of In 2004, however, the equipment required replacing Property Overview regional television was a converted studio in All Souls and the subject property was purpose built. All of BBC

Tenure

Tenancy Leeds College of Music

Lease Summary Leeds College of Music is a music conservatoire based in Leeds College of Music hosts a seasonal programme of (1965–1971) and City of Leeds College of Music (1971– the Quarry Hill district of Leeds, . concerts, in the subject property, a 350-seat auditorium. 1997), founder and first principal Joseph Stones (1965- Regeared Lease 1993), and became a wholly owned subsidiary of Leeds The college is the only conservatoire in the UK to offer In 2011 Leeds College of Music was awarded All-Steinway City College in August 2011 Salient Lease Points both Higher and Further Education courses. Aside from its School status – becoming the only conservatoire in education provision – which also includes short courses England to have 90% of its pianos from the Steinway The BBC and programmes for adults and school-age musicians – family. It was formerly known as Leeds Music Centre

BBC Yorkshire & Leeds College of Music Capital Allowances & VAT

Proposal

Contact Details

9. BBC TV Studio & LEEDS COLLEGE OF MUSIC BBC Broadcasting House, 2 St Peters Square, Leeds, LS9 8AH

Investment Summary

Location

Situation

Communications

Property Overview

Tenure

Tenancy

Lease Summary

Regeared Lease Capital Allowances Contact Details

Salient Lease Points Have been fully claimed by the vendor. None available to transfer. Mike Burden MRICS Josh Beebee MRICS e: [email protected] e: [email protected] The BBC VAT t: +44(0)20 7952 6103 t: +44(0)20 7952 6297 BBC Yorkshire & m: +44 (0)7815 305 180 m: +44 (0)7539 439 300 Leeds College of Music We understand the property will be treated as a Transfer of a Going Concern for @mike_burden @joshbeebee Capital Allowances VAT purposes. & VAT

Proposal Proposal Charlie Moulton e: [email protected] Contact Details Offers are invited in excess of £8,500,000 (Eight Million and Five Hundred Thousand Pounds) for the Long Leasehold interest, subject to contract and exclusive of VAT. t: +44(0)20 7952 6298 m: +44 (0)7435 212 323 A purchase at this level would reflect a net initial yield of 5.23% after allowing for the

purchaser’s costs of 6.701%. This represents a low capital value of approximately £230 per sq ft. MISREPRESENTATION ACT 1967 Kimmeridge Real Estate Ltd on its own behalf and for vendors or lessors of this property, whose agent it is, gives notice that: 1. The particulars are produced in good faith, but are a general guide only and do not constitute any part of a contract. 2. No person in the employment of the agent(s) has any authority to make or give any representation or warranty whatsoever in relation to this property. 3. The property is offered subject to contract and unless 10. otherwise stated all rents are quoted exclusive of VAT. 4. 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. 5. 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 if required. Publication Date: February 2018