SALE & LEASEBACK AIRCRAFT TYRES 25 YEARS FORT PARKWAY, WITH RPI UPLIFTS • Extensive site of approximately 10.75 collar and cap of 2.00% - 4.00% per Proposal Investment Summary acres annum compounded Offers are invited in excess of £15,275,000 • Substantial industrial complex located • Upon completion of the sale, DUNLOP • The tenant has been in occupation of which reflects anattractive NIY of 5.35%, in the prime industrial area known as AIRCRAFT TYRES LIMITED will enter in the site for approximately 100 years assuming purchaser’s costs of 7.73%. This Fort Dunlop, extending to 293,303 sq ft to a new 25 year lease without break and is one of only 4 businesses reflects a price of £52 per sq ft. (27,248.9 Sq M) worldwide who are authorised to • The passing rent will be £879,909 A purchase at this level will reflect a manufacture aircraft tyres by the CAA • Located in , Birmingham, per annum (equating to £3.00 per sq ft) minimum yield of 5.90% in 2023 given and equivalent global bodies the RPI collar provided (i.e. 2.00%), or a being close to Junction 5 of the M6 which will be reviewed on a 5-yearly yield of 7.01% in 2023 given the RPI cap Motorway basis in-line with RPI, subject to a • Freehold (i.e. 4.00% pa).

2 40 Fort Parkway • Erdington • Birmingham • B24 9HL 1 JLR Castle Bromwich site 4 UK Mail 7 Amazon 10 Fort Shopping Park 13 Lamborghini & Bentley 16 Roman Originals 19 Fort Dunlop 2 Trinity Mirror 5 DHL/JLR 8 Iron Mountain 11 Toyota 14 JLR 17 Stadco 20 JLR Rail Head 3 Spitfire Park 6 Kuehne + Nagel 9 Hermes 12 Lexus 15 Paroh 18 Meggit 21 Fort Industrial Park

A38

4 1 A38 3

6 2 8

7 21 9 A47 5

18

17 16

15 19 20 11 14 DUNLOP 12 AIRCAFT TYRES JUNCTION 5 >

13 10 M6

A47

< JUNCTION 6

3 DUNLOP AIRCRAFT TYRES 40 Fort Parkway • Erdington • Birmingham • B24 9HL Tamworth SHEFFIELD

NOTTINGHAM M6 M1 Location PETERBOROUGH Walsall NORWICH Located in the centre of the with the largest regional population outside , BIRMINGHAM CAMBRIDGE NORTHAMPTON

M5 M40 M1 Birmingham is regarded as Britain’s second city. With an economy of £24.8 billion, it forms a Sutton M6 Toll M42 M11 Coldfield CHELTENHAM COLCHESTER M6 A1(M) substantial part of the broader economy which generated a Gross Added Value

OXFORD CHELMSFORD M25 (GVA) of £127 billion in 2016, larger than 11 of the 28 EU nations, sitting between Hungary and READING M4 LONDON A38 Greece. M25 M20 M3

PerryCRAWLEY A452 M5 Common Birmingham is in the heart of a world class multi-modal transport infrastructure, providing access M6 M5 DUNLOP AIRCRAFT to 90% of Britain’s economy which can be reached within a travel time of four hours. The subject West Erdington A34 TYRES Bromwich property is located within 5 miles of 11 separate motorway junctions. A40 A47 M6 M42 A38(M) A41 Coleshill Birmingham Transport Links Snow Hill Stechford BIRMINGHAM Road Birmingham 2 Moor Street M6 A456 Birmingham New Street Birmingham City centre Coventry Northampton Manchester Liverpool London 5 miles 19 miles 50 miles 89 miles 100 miles 115 miles A45 Birmingham 10 min 24 min 48 min 1hr 26 min 1hr 33 min 1hr 48 min Sparkhill A435 Selly A41 Passenger Rail Oak King’s M42 A441 Birmingham New Street Birmingham International Heath A34 5 miles 9 miles 10 min 20 min Shirley

Freight Rail Hams Hall DIRFT 5 miles 35 miles 12 min 33 min

Air * Coventry East Midlands 9 miles 23 miles 31 miles 20 min 28 min 30 min

* (13 million passengers in 2017)

4 DUNLOP AIRCRAFT TYRES 40 Fort Parkway • Erdington • Birmingham • B24 9HL Little Chalfont

W O O D S I  D E Tyburn R O A 4 A Stockland Erdington 5 D 2

Green

Castle

Situation Vale

D D A A

A 4 O

The property is prominently situated on, and accessed directly from, 0 R O Gravelly 8 Y NGSBUR R 0 KI JAGUAR Hill

7 E LAND ROVER Fort Parkway in the most popular industrial zone within Birmingham, 2 D 1 D M6 A A 5 L O A R

S N both in terms of employment and offering an established business R FORT U B Y DUNLOP T

A

network, with a superb pool of customers and suppliers. DUNLOP 4

5

Bromford AIRCRAFT 2

A38(M) TYRES

6 THE FORT Fort Parkway forms part of the A47 Heartlands Spine Road dual 7 M6 4 ROAD A N SHOPPING R U 45 YB A T PARK 5 carriageway which is one of the main road arteries, linking through

to Junction 5 and Junction 6 of the (Spaghetti Junction),

STAR CITY M6

the hub of the national motorway network. Birmingham City centre is

A readily accessed via the A38(M) approximately 5 miles distant. Nechells 7 4 A4 0

8 0 To the west of the subject property is The Fort Shopping Park Castle Bromwich providing in excess of 300,000 sq ft of retail accommodation with Washwood Hodgehill Heath Birmingham

occupiers including Boots, Next, Debenhams, H&M and Primark, City Centre  amongst other household names. SAT NAV: LN6 9BJ To the east is the Castle Bromwich car assembly plant for all Jaguar saloon and sports cars. Over 3,000 workers currently work at the site which also benefits from a rail distribution

hub. Tower Lane Industrial Estate Adjacent to Dunlop Aircraft Tyres is the award winning Urban Splash regeneration of Fort Dunlop. Providing 360,000 sq ft within a ‘vertical St George’s Industrial office park’ scheme, it includes a Travelodge hotel and amenities. Estate

Prologis have developed approximately 700,000 sq ft of prime manufacturing and logistics accommodation in close proximity to the subject property. Further, there are a number of car dealerships nearby, including the Lamborghini, Toyota and Bentley garages which are directly to west of the subject property.

The property’s prominence and extensive road frontage are also major attractions of the site.

5 DUNLOP AIRCRAFT TYRES 40 Fort Parkway • Erdington • Birmingham • B24 9HL occupier, Dunlop Aircraft Tyres. There are a number of tunnels located beneath Description the building which are no longer used and Over the years the occupier has added small The property comprises a substantial and originally provided access to neighbouring extensions and made alterations as necessary to industrial site which provides a warehouse buildings on the previous larger site. suit the business need. The occupier has a large and manufacturing unit together with a self- amount of on-site machinery which is used for A further pump house serving the building is contained office building. The original building production, retreading and testing of aircraft tryes located off-site but nearby, which is included was constructed during the 1910s and has been with a proportion of this having been in-situ for within the sale and leaseback. extended over time. The two-storey office block over 80 years. was constructed during the 1930s and this Access to the site is from the A47 Fort Parkway was extended in the 1950s with an additional The accommodation offered by the buildings is from which there is a gated entrance and interconnecting three-storey block. functional for the occupiers needs. Loading doors associated gate house. The majority of the car are provided around the site which comprise a parking provision is provided on the west of the The building is and has only ever been used mixture of level access and dock level loading site as well as further spaces situated around the for the production of aircraft tyres by the same doors. site perimeter.

6 DUNLOP AIRCRAFT TYRES 40 Fort Parkway • Erdington • Birmingham • B24 9HL L Col

L Col

L Col

< U

n

i

t

1

El Sub Sta

L Col L Col N L Col

L Col

L Col

84.6m

U

n

i

t

2

L Col 2

3 Fort Dunlop

P

Paroh 84.5m

Site Area 8

84.4m

The site extends to approximately 4.35 ha (10.75 acres). Tank 84.4m

4

Chy Site coverage is approximately 57%.

AY RKW T PA FOR 84.6m

BROMFORD 84.3m

2

y d Bd War st & Con Accommodation Boro 5 37.7 CR MP 84.3m For Indicative Purposes Only

SL Path FORT The property has been measured by Plowman Craven in PARKWAY SL 0m 50m 100m 150m accordance with the RICS Property Measurement (2nd Edition, 84.6m Ordnance Survey © Crown Copyright 2018. All rights reserved. Licence number 100022432. Plotted Scale - 1:2500

2018), which incorporates the RICS Code of Measuring Practice This plan is published for convenience of identification. Any site boundaries shown are indicative only and should be check against Title Deeds. (6th Edition) and the new International Property Measurement ES753998 Standards (IPMS) and provides the following accommodation on a Gross Internal Area basis:

DESCRIPTION GIA (SQ FT) GIA (SQ M)

Warehouse 244,916 22,753.5

Offices 48,387 4,495.4

TOTAL 293,303 27,248.9

The measured survey can be provided upon request and reliance on this can be extended to the purchaser.

7 DUNLOP AIRCRAFT TYRES 40 Fort Parkway • Erdington • Birmingham • B24 9HL Leaseback Covenant Information Upon completion of the sale, the property will be let to Dunlop Aircraft Tyres Limited for a term of 25 years without break.

The passing rent will be £879,909 per annum, equating to £3.00 per sq ft overall. The rent will be reviewed in-line with the Retail Price Index (RPI), Dunlop Aircraft Tyres Limited is the world’s only dedicated specialist subject to a collar of 2.00% and a cap of 4.00%, compounded annually and manufacturer and retreader of aircraft tyres, having been in operation for more effective five yearly. than 100 years. The subject property forms the Global headquarters for the business, with other sites located in the USA and China. The tenant will have the automatic right to extend their lease for a term of 5 years for a maximum of two occasions. The business supplies in excess of 150 different aircraft types with over 300 individual customers globally, and holds over 500 approvals from either the Tenure Civil Aviation Authority, or other such global equivalents. The business has both aircraft manufacturers and operators among its customer base. It supplies The property is held freehold. tyres directly to manufacturers such as Airbus, Boeing, Bombardier and A small parcel of land to the west has been carved out and sold historically. Embraer, as well as providing tyres to operators such as Jet2, Flybe, Lufthansa, This has been excluded within the site plan shown. the US Airforce and China Express.

Sales turnover has increased year on year over the previous 5 years, with headline figures from the most recent accounts being:

31 DEC 2017 31 DEC 2016 31 DEC 2015

Sales Turnover £53,340,000 £52,260,000 £47,298,000

Profit/ (Loss) Before Taxes £22,142,000 £3,555,000 £7,329,000

Total Net Worth £39,505,000 £43,037,000 £41,972,000

The latest accounts show an inflated pre-tax profit which is due to exceptional administrative circumstances relating to an inter-company disposal.

The business has a Dun & Bradstreet rating of 5A1, representing a ‘minimum risk’ of business failure.

8 DUNLOP AIRCRAFT TYRES 40 Fort Parkway • Erdington • Birmingham • B24 9HL Site Operation Aircraft tyres have been produced on-site for approximately 100 years, with Dunlop Aircraft Tyres being one of only 4 producers worldwide who are authorised to manufacture both new and retreaded tyres for both the civilian and military aviation markets.

Approximately 450 people are employed on-site with the business operating continuous working shift patterns, allowing the site to operate 24 hours a day 7 days a week. The business also operates from two further facilities worldwide, one of which is in the United States and the Tyres are produced for a variety of civil aircrafts, functions which includes all of the design, other being located in China. Those facilities with the business having predominantly targeted, engineering and materials development. Since the carry out a retreading function only, rather than and had great success in, the regional aircraft group’s strategy for growth involves expanding its the production of new tyres, with that part of market. Approximately 30% of the customer product range, it is currently investing heavily in the business conducted solely from the subject base is supplying military aircraft with various expanding and upgrading its tyre testing facility property. contracts in place including being the sole involving a multi-million pound investment in supplier to the Boeing C-17 Globemaster military a dedicated dynamic tyre testing rig and the aeroplane. Approximately 90% of the tyres either associated upgrades to the site power supply. produced or retreaded on-site are exported to The subject facility houses a multitude of highly- carriers and manufacturers around the world. specialised tyre testing, building and retreading The business has historically invested heavily equipment all of which would be very expensive in the site and its relevant operations and it to relocate. Importantly, relocation would also continues to do so. A new tyre building machine, trigger a re-authorisation by the Civil Aviation which will allow the production of radial tyres, Authority (CAA) and other relevant authorities has recently been installed at a cost in the causing long machine downtime and creating region of £3m, and this will support an expected further costs. The CAA regulations require each increase of market share in radial tyres going individual process to be approved, making it very forward. The site is also the home to the HQ difficult for new entrants to come into the market.

9 DUNLOP AIRCRAFT TYRES 40 Fort Parkway • Erdington • Birmingham • B24 9HL Birmingham Industrial Market Occupational demand for manufacturing and logistics space across the UK is continuing to be robust, due to the structural changes in the market that are being experienced by businesses across the sectors. Birmingham has been synonymous with the manufacturing sector over the last century, and recently demand in the sector has been driven by the automotive industry, in particular following the rapid expansion of Jaguar Land Rover and continued growth of Aston Martin and LEVC in Coventry. This has had a downstream effect on both Tier 1 and Tier 2 suppliers to the automotive industry, where demand from such occupiers remains strong.

Owing to its central location, Birmingham is an established logistics location, with strong demand having been witnessed in particular from the rapid growth of e-commerce. Whilst much of the logistics Birmingham demand is for large scale distribution centres in Investment Market strategic locations around the country, there is a Underpinned by the regional connectivity, as well Rents in this sector are continuing to rise, with a growing demand from customers for next day, or as being a key regional sub-market, Birmingham forecast of 2.5% per annum in the period 2018- indeed same day deliveries which is accelerating and the wider region remains a prime target for a 2022, particularly attractive when compared the take-up of smaller scale urban logistics sustained weight of investor demand and capital, with the all property rent growth index of 1%. centres, capable of servicing the population quickly in particular for assets benefiting from strong This limited supply, selective development and and effectively. The increase in the use of electric income, property and location fundamentals. The increasing rents have further favoured investors vehicles for local deliveries is also helping to acute imbalance of undersupply against robust and reinforced their positive approach to the sector fuel demand due to the current limited range of occupational demand is driving positive rental and its association with defensive income streams, vehicles. growth throughout the manufacturing and logistics a slow rate of obsolescence and attractive income sectors, which has seen yields harden over time. returns.

10 DUNLOP AIRCRAFT TYRES 40 Fort Parkway • Erdington • Birmingham • B24 9HL EPC The property has two separate EPC ratings, as follows:

Industrial – E-102 Offices –E-116 VAT The property is elected for VAT and therefore VAT will be payable on the purchase price and SDLT on the gross purchase price. Legal Costs Each party is to bear their own costs. Capital Allowances There are no transferable allowances.

Proposal Offers are invited in excess of £15,275,000 which reflects anattractive NIY of 5.35%, assuming purchaser’s costs of 7.73%. This reflects a price of £52 per sq ft. A purchase at this level will reflect a minimum yield of 5.90% in 2023 given the RPI collar provided (i.e. 2.00%), or a yield of 7.01% in 2023 given the RPI cap (i.e. 4.00% pa).

11 DUNLOP AIRCRAFT TYRES 40 Fort Parkway • Erdington • Birmingham • B24 9HL 12

DUNLOP AIRCRAFT TYRES 40 FORT PARKWAY, ERDINGTON, BIRMINGHAM B24 9HL

FURTHER INFORMATION

DAVID HAYNES ANDY DICKENS DAVID SMEETON JUSTIN QUIBELL [email protected] [email protected] [email protected] [email protected] 020 7152 5373 020 7152 5030 0121 710 4657 0121 697 7213 07733 123 318 07793 808 030 07785 253 059 07764 413 752

MISREPRESENTATION CLAUSE Cushman & Wakefield gives notice to anyone who may read these particulars as follows: 1. These particulars are prepared for the guidance only of prospective purchasers. They are intended to give a fair overall description of the property but are not intended to constitute part of an offer or contract. 2. Any information contained herein (whether in the text, plans or photographs) is given in good faith but should not be relied upon as being a statement or representation of fact. 3. Nothing in these particulars shall be deemed to be a statement that the property is in good condition or otherwise nor that any services or facilities are in good working order. 4. The photographs appearing in this brochure show only certain parts and aspects of the property at the time when the photographs were taken. Certain aspects may have changed since the photographs were taken and it should not be assumed that the property remains precisely as displayed in the photographs. Furthermore no assumptions should be made in respect of parts of the property which are not shown in the photographs. 5. Any areas, measurements or distances referred to herein are approximate only. 6. Where there is reference in these particulars to the fact that alterations have 43-45 Portman Square London been carried out or that a particular use is made of any part of the property this is not intended to be a statement that any necessary planning, building regulations or other consents have been obtained and these matters must be verified by any intending W1H 6LY purchaser. 7. Descriptions of a property are inevitably subjective and the descriptions contained herein are used in good faith as an opinion and not by way of statement of fact. The particulars were prepared in October 2018. Brochure by Mango 020 7060 4142