OPEN CONSENTED RETAIL PARK INVESTMENT

NEWQUAY ROAD RETAIL PARK

ENTER > OPEN CONSENTED RETAIL PARK INVESTMENT HOME INVESTMENT LOCATION & RETAIL SITUATION TENANCIES ASSET MANAGEMENT PROPOSAL SUMMARY CATCHMENT WAREHOUSING & DESCRIPTION & PLANNING & COVENANTS & CONTACTS ROAD RETAIL PARK, TRURO TR1 1XD IN TRURO

INVESTMENT SUMMARY

Truro, the dominant commercial administrative centre for , is situated in a highly accessible position on the A390, 28 miles east of and 56 miles west of Plymouth.

The city has a very limited supply of retail warehousing, with Newquay Road Retail Park being the only scheme situated on the eastern side of the city.

The property is located in an accessible and improving retail location with a new Waitrose development planned opposite.

The park totals 49,296 sq ft, arranged in 4 units let to Dunelm, Harveys, Dreams and Hobbycraft.

The scheme benefits from a wide planning consent allowing the sale of all comparison goods.

The scheme is let off at relatively low rents of between £12.50 and £16.00 per sq ft.

There is asset management and rental growth potential with the possibility of further improving the tenant line up in the future.

Our clients are seeking a price in excess of £10,210,000 (Ten Million, Two Hundred and Ten Thousand Pounds) which will provide a purchaser with an attractive net initial yield of 6.50%, assuming purchaser’s costs of 5.80%. Bromyard 11 Builth Wells 7 Stratford A487 upon AvonA3400 Bedford A4112 A486 Lampeter A4103 M1 A509 M11 Woodbridge A470 Towcester A508 A1307 Cardigan A475 Pershore A46 A422 A5 A483 A10 10 A438 Great Newport Biggleswade Haverhill A1071 Ipswich A438 A6 A44 Shipston-Banbury A482 Hay-on-Wye Malvern Evesham Pagnell A505 9 A438 on-Stour 11 Sudbury 14 A1 A134 A14 A43 Milton A421 Royston A1017 Newcastle Hereford Ledbury 8 A422 Saffron (A604) Emlyn 1 A44 Brackley Keynes 13 A12 Fishguard A422 10 A505 Walden Llandovery A46 Moreton-in-Marsh Letchworth Baldock A131 Manningtree Felixstowe A485 A470 9 A487 2 Buckingham A507 Halstead A40 A479 A484 A465 Tewkesbury A421 Harwich Brecon A43 12 9 A1124 A478 Hitchin M50 10 LeightonA5 A120 St David's M5 A44 Buzzard 8 A120 A49 4 3 10 Stow-on- the-Wold Chipping M1 A40 Braintree A40 Ross-on-WyeGLOUCESTERSHIRE Norton M40 Luton A1(M) Stevenage STANSTED

Colchester A133 Carmarthen Llandeilo Cheltenham Bicester Dunstable 11 7 A602 8 A40 11 A4260 A487 Crickhowell Gloucester A41 Bishop's A120 A361 A40 A44 A413 A483 9 A48 10 A10 A34 LUTON Welwyn Stortford A130 A40 A40 A4067 A470 A40 A131 Haverfordwest Abergavenny A4136 A436 Garden6 Narberth St Clears 9 Witham A12 Aylesbury City Ware A1060 Clacton-on-Sea Monmouth A417 A40 Kidlington 5 West A465 Brynmawr Witney Tring Hertford M11 Merthyr A429 Hemel Mersea A4076 Ammanford Tredegar 12 A40 A41 St 4 Harlow Milford A477 Tydfil Ebbw Blaenavon A40 Hempstead Kidwelly A4042 Oxford Hatfield Carterton Wendover A413 8 Albans Maldon Haven ValeA467 Chelmsford Neyland 49 13 Stroud A40 M10 3 Hoddesdon7 A141 A484 Rhymney Berkhamsted 7 A478 A465 A48 1 2 A466 8 A418 Thame A414 Aberdare Lydney A419 A4010 Pembroke A476 48 A472 A449 M5 Cirencester 7 22 Dock A477 Tenby Burry Pontypool Amersham 20 M4 Glyncorrwg 24 25 26 A12 A130 Pembroke PortLlanelli 47 46 45 Mountain Bargoed Nailsworth 19 5 M25 44 Ash A420 Abingdon Watford 43 Neath 6 High Enfield 5 Burnham-on-Crouch Swansea Cwmbran A46 Faringdon 18 Barnet 5 Wycombe 4 Chigwell 42 Chepstow A417 17 A10 A129 Risca 14 Tetbury Cricklade A419 Didcot M11 28 Rayleigh 41 2 A338 M40 4 Beaconsfield A12 Brentwood 3 2 A406 4 A127 A418 Maesteg40 A470 26 25 24 M48 1 A433 M1 Port 39 Pontypridd 27 23 Caldicot Wallingford A4130 Marlow 2 29 A127 Basildon Southend-on-Sea Newport Malmesbury Wantage A40 1 A41 Talbot 38 Caerphilly28 22 21 1 Harrow M4 Swindon A13 Port 29 UxbridgeA406 CITY M25 36 M4 30 SECOND SEVERN 16 Henley- Maidenhead A13 Einon 32 CROSSING OPEN M49 16 A429 Canvey Island 37 SUMMER 1996 17 M4 15 on-Thames Slough LONDON 35 34 19 17 A329 A4074 7 30 33 A346 Avonmouth A4 6 4 1 Woolwich Bridgend 18 1 18 A34 3 2 31 Tilbury Porthcawl M4 A4361 CARDIFF 19 2M32 LYNEHAM Windsor A4 Sheerness Cowbridge 3 A420 Chippenham Reading 14 Richmond A205 DartfordGravesend Clevedon M5 Calne 14 13 M4 A329(M) 13 HEATHROW A20 A2 2 Margate Corsham A350 20 A46 Hungerford 12 10 Bracknell Kingston A2 Rochester Herne BRISTOL Marlborough A4 Staines 1 Swanley 1 Bay Barry A4 11 upon Thames Gillingham A28 A4 Newbury 2 A38 Melksham A299 Congresbury A37 A232 Chatham Whitstable Weston- 11 Sutton Sittingbourne A253 Ramsgate super-Mare 21 Bath A361 Croydon 4 4 A28 A338 3 3 5 A2 Faversham BRISTOL Devizes Camberley M20 A227 A36 A34 M25 Epsom M25 A340 A22 2 4 A249 7 A257 A342 A338 10 6 Sandwich Kingsclere A33 4 Woking 9 3 6 M2 Canterbury A23 5 A2 A368 Trowbridge A339 A24 M26 7 A343 9 5 Cheddar A331 7 Caterham Leatherhead M25 SevenoaksA228 8 A2 A361 A3 A25 A371 A362 Basingstoke 5 6 Maidstone A20 8 A21 Deal Lynton A360 A345 6 Aldershot A323 A227 Westbury M3 Dorking A26 A339 RedhillOxted Burnham-on-Sea 22 A25 Reigate M20 A28 A256 Ilfracombe Lynmouth Minehead Frome Andover Whitchurch7 Guildford Tonbridge A274 A22 Farnham A31 A229 A39 A361 Warminster A24 A2 A39 8 M23 CHANNEL Watchet Wells Shepton A287 Godalming 9 A3057 TUNNEL A3123 Mallet A36 GATWICK Ashford TERMINAL Dover A303 Amesbury A303 9 East 10 A39 Alton Grinstead Tunbridge Wells A20 A361 23 Glastonbury A361 A264 A262

A39 A371 A39 A34 Crawley 10 A264 A343 A29 A21 13 A359 A338 A28 11 Bridgwater A2070 M20 12 A358 A30 A33 A396 A372 Cranbrook Street A345 M3 New Folkestone A37 Alresford A31 A264 Tenterden Barnstaple Haslemere 11 Hythe 24 Wilton A3 A26 9 A32 A22 A267 Wincanton Horsham A259 Salisbury Winchester A272 Liphook A281 Crowborough A303 A350 10 A283 A275 A28 A264 Langport 0 11 Billingshurst Haywards Bideford South Molton A36 9 A265 A268 New Romney Taunton 25 A30 30 Heath A272 A361 A (A31) A272 A358 A357 A30 A354 Romsey A272 A265 12 A23 A39 Petersfield Uckfield Shaftesbury Midhurst A273 Rye Wellington 26 A303 13 Eastleigh A29 Pulborough Great Torrington 14 Heathfield A21 Lydd/Ashford OPEN CONSENTED RETAIL PARK INVESTMENT Yeovil A275 HOME INVESTMENT LOCATION & RETAIL SITUATION TENANCIES ASSET MANAGEMENT PROPOSALA3088 A338 4 2 3 4 5 A286 Hurstpierpoint SUMMARY CATCHMENT WAREHOUSING & DESCRIPTION & PLANNING & COVENANTS & CONTACTS Sherborne A24 A22 Battle 27 Ilminster 7 A26 A28 A259 NEWQUAY ROAD RETAIL PARK, TRURO TR1 1XD IN TRURO 1 A334 A32 1 A283 SOUTHAMPTON 8 A3(M) A27Lewes A271 Hastings A31 Lyndhurst 9 3 HavantA27 Arundel HailshamA259 A337 M27 Ringwood 10 11 Chichester A27 SHOREHAM Brighton A27 Hythe 5 Bexhill- 12 A29 A259 Wimborne A31 Fawley Fareham 12 Littlehampton Hove on-Sea A350 Brockenhurst A22 A354 Minster Worthing Newhaven Crediton Gosport M5 A338 A35 A259 A30 Axminster Eastbourne A348 Lymington Portsmouth Bognor Seaford A31 Okehampton A35 Regis A388 A35 Cowes Ryde EXETER 29 Seaton Bridport New Milton Selsey 30 A3052 Dorchester Poole Christchurch A30 Lyme Bournemouth Newport Tintagel 31 A376 Regis Wareham Freshwater A352 Launceston Sidmouth A351 A382 A353 A3020 Sandown A39 A380 Exmouth A3055 Shanklin A388 Swanage Dawlish Weymouth Ventnor A30 Tavistock Teignmouth A38 Ashburton A390 Newton Abbot A38 Buckfastleigh A386 Torquay Newquay A392 A385 Paignton PLYMOUTH Totnes

A391 A387 A3075 Brixham Plympton A30 A379 Dartmouth A390 A381 A379 TRURO Kingsbridge St Ives

A3078 Salcombe A39 St Just Penzance A394 A30 Falmouth Sennen

A3083

Lizard LOCATION CATCHMENT & DEMOGRAPHICS

The cathedral city of Truro is the administrative and commercial centre for Cornwall. PMA estimate that Truro’s primary catchment area population is 416,000 people, ranking it 57 out of the 200 top PMA The city is situated 285 miles south west of London, 28 miles east of Penzance, centres in the UK. Truro also has an estimated shopping population of 218,000 people, ranking it 53. There are 131,646 people 11 miles north of Falmouth and 14 miles west of St Austell. living within a 20 minute drive time of the subject property, which CACI estimate will increase by 4.64% by 2017.

Truro benefits from good road communications, being located 6 miles south of the A30, Given the lack of retail offer and competition from the surrounding towns, Truro provides the predominant retail offer in south and adjacent to the A390, which provides the major carriageway through the south of west Cornwall and as such draws upon a wide catchment area, including the nearby towns of St Austell, Camborne Cornwall. Both the A390 and A30 also provide direct access to Exeter and Junction 31 and Falmouth. of the M5 motorway, situated approximately 87 miles to the east. Retail expenditure in Truro is significantly above average, demonstrating the relative affluence of the area: Truro is served by a direct train service from London Paddington, with a journey time of approximately 4 hours 20 minutes. Newquay Airport is located 17.5 miles to the north Retail PMA Average Truro providing flights to several UK and European destinations. Top 200 Centres Total in-store comparison retail expenditure 2012 (£m) £945 £795 Per capita retail warehouse expenditure 2012 £478 £471 Per capita in-store comparison expenditure 2012 £2,270 £2,287 Forecast growth in comparison retail expenditure 1.6% 1.4% 2012 – 2017 (per annum % real) OPEN CONSENTED RETAIL PARK INVESTMENT HOME INVESTMENT LOCATION & RETAIL SITUATION TENANCIES ASSET MANAGEMENT PROPOSAL SUMMARY CATCHMENT WAREHOUSING & DESCRIPTION & PLANNING & COVENANTS & CONTACTS NEWQUAY ROAD RETAIL PARK, TRURO TR1 1XD IN TRURO

A 3 9 NEWQUAY ROAD N E W RETAIL PARK Q U L A IL Y N H R NIO D U

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G E THREEMILESTONE RETAIL PARK TRELISKE RETAIL PARK T R A390

ROYAL CORNWALL HOSPITAL

A390 HIGHE A390 R BES ORE RD TRELISKE A39 0 HIGHERT OWN THREEMILESTONE HIGHERTOWN TRURO GARRAS WHARF RETAIL PARK A 3 9 0 G R E E E N V

LA A N IX E A L R O M A39

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RETAIL WAREHOUSING IN TRURO

Despite the size of its retail catchment and retail dominance in south THREEMILESTONE RETAIL PARK GARRAS WHARF RETAIL PARK west Cornwall, Truro has a limited supply of retail warehousing, the (112,500 sq ft) – Petros Developments (34,300 sq ft) – Smiths Industries Pension Fund majority of which is situated on the western side of Truro. The subject property is the only retail warehousing located on the eastern side of Approximately 2.75 miles to the west of Truro city centre is To the south of Truro city centre fronting the A390 situated close to the city. Threemilestone Retail Park, which benefits from an open A1 non- a Tesco foodstore is an older 2 unit scheme where the occupiers are food consent, with the occupiers being Wickes, Matalan and Home Staples and Currys. The rents on the Currys unit (14,500 sq ft) reflects TRELISKE RETAIL PARK Bargains. £18.75 per sq ft, whilst the rent on the Staples unit (19,800 sq ft) (86,000 sq ft) – Diageo Pension Fund equates to £16.66 per sq ft. In close proximity is a proposed new development, which will This scheme is situated approximately 2 miles to the west of Truro comprise a standalone DFS of 16,000 sq ft and an A3 unit occupied On the opposite side of the A390 is a standalone Halfords unit city centre and has an open A1 non-food consent. It is occupied by by KFC. (10,051 sq ft), which is owned by a local investor. Pets at Home, Argos, Brantano, Homebase, PC World and Carpetright. The highest rent achieved was a letting to Argos at £21.00 per sq ft in July 2006.

In close proximity to Treliske Retail Park is a standalone unit of circa 34,000 sq ft occupied by The Range. OPEN CONSENTED RETAIL PARK INVESTMENT HOME INVESTMENT LOCATION & RETAIL SITUATION TENANCIES ASSET MANAGEMENT PROPOSAL SUMMARY CATCHMENT WAREHOUSING & DESCRIPTION & PLANNING & COVENANTS & CONTACTS NEWQUAY ROAD RETAIL PARK, TRURO TR1 1XD IN TRURO

SITUATION

Newquay Road Retail Park is situated in a highly accessible position at the junction of the A38 Newquay Road and the A390 Tregolls Road, approximately 1 mile east of the city centre. Newquay Road effectively forms the edge of the PROPOSED WAITROSE DEVELOPMENT Truro conurbation with the majority of the surrounding area being occupied by residential accommodation.

Directly opposite the subject property is a site where works have commenced for a mixed use development, which will be anchored by a Waitrose foodstore. The development will total 41,538 sq ft of retail floorspace to also include an associated Cornish food market. There will also be a 1,379 space park and ride bus service improving public transport and accessibility to the area and around 100 new residential dwellings.

The scheme has planning consent and work has recently started on site with completion due in late 2015. Once developed, together with the subject property, this will form a major retail attraction for east Truro and increase the critical mass of the area. This we believe will help attract new tenants to the subject property and increase the existing tenant’s trade.

DESCRIPTION

The subject property extends to a total of 49,296 sq ft and is anchored by Dunelm. It is arranged as 2 terraces with car parking to the front and side of each. The scheme was redeveloped in 2012 and provides modern attractive retail space, with glazed frontages and brick and metal profile clad elevations.

Internally, the units are fitted out to the individual tenant’s specification. Units A2, B1 and B2 all benefit from having extensive mezzanine floors, which are partially used for trading.

There is an area extending to 4,840 sq ft voided off at the rear of the Harveys unit which is not rentalised. Behind this is a service corridor which is demised to Dunelm for their exclusive use, but not included within the GIA of the unit.

Dream’s GIA excludes a service corridor, which is within their demise for their exclusive use.

The scheme benefits from 204 car parking spaces, equating to a ratio of 1:247 sq ft.

Servicing is located to the northern elevation of the Dunelm unit and the side elevation of the Hobbycraft unit. Service and customer access and egress is via Newquay Road. OPEN CONSENTED RETAIL PARK INVESTMENT HOME INVESTMENT LOCATION & RETAIL SITUATION TENANCIES ASSET MANAGEMENT PROPOSAL SUMMARY CATCHMENT WAREHOUSING & DESCRIPTION & PLANNING & COVENANTS & CONTACTS NEWQUAY ROAD RETAIL PARK, TRURO TR1 1XD IN TRURO

TENANCIES

The property benefits from an average income weighted unexpired lease term of over 10.7 years (including breaks), and is let in accordance with the tenancy schedule below:

Unit Tenant GIA Lease Start Term Lease Expiry Next Current Rent Rent Comments EPC (sq ft) Date (Years) Date Rent Review (per annum) (per sq ft) Rating A1 Harveys 10,300 17/10/1997 24.5 26/04/2022 01/05/2017 £162,225 £15.75 C A2 Dunelm 24,000 31/01/2011 15 30/01/2026 31/01/2016 £300,000 £12.50 18,000 sq ft mezzanine space. The rent is capped at review at 2% p.a. C compounded over 5 years. There is a service charge cap for the first 5 years of the lease at £12,312.50 B1 Dreams 7,553 20/06/2011 15 19/06/2026 20/06/2016 £120,848 £16.00 C B2 Hobbycraft 7,443 17/08/2012 15 16/08/2027 17/08/2017 £119,040 £16.00 The rent reviews at years 5 and 10 will be upward only to open market C value, capped at 3% compounded over 5 years. Tenant break 17/08/2023 TOTAL 49,296 £702,161 £14.24

TENURE The site, as outlined in red below, is held freehold.

NEWQUAY ROAD SERVICE CORRIDOR

VOID

PLANNING

Planning consent was granted in 2009 and 2010 for the refurbishment of the scheme which included unit subdivision works and for the inclusion of mezzanines within Units A2, B1 and B2.The consent allows for the scheme to be used for the

sale of comparison goods. SERVICE CORRIDOR

The planning permissions are available on request. TREGOLLS ROAD (A390) OPEN CONSENTED RETAIL PARK INVESTMENT HOME INVESTMENT LOCATION & RETAIL SITUATION TENANCIES ASSET MANAGEMENT PROPOSAL SUMMARY CATCHMENT WAREHOUSING & DESCRIPTION & PLANNING & COVENANTS & CONTACTS NEWQUAY ROAD RETAIL PARK, TRURO TR1 1XD IN TRURO

ASSET MANAGEMENT POTENTIAL

Given the size and extent of its catchment, Truro has a very limited supply of retail warehousing, particularly on the eastern side of the city, where Newquay Road Retail Park is the only out of town scheme.

The park was fully refurbished in 2012 and pre-let to the existing tenants. However, with the improving occupational market, we believe there is the opportunity to further enhance the tenant line up, particularly with retailers who can be accommodated within the open A1 non-food planning consent.

Dreams was sold to Sun Capital Partners in March 2013 in a pre-pack administration. Dreams remained in occupation of 171 stores including their store on the subject property, which we understand trades well. However, there have been approaches from several retailers for the unit and we believe there is the opportunity to re-let this to a ‘softer’ retailer, subject to agreeing a surrender with Dreams.

The void area to the rear of the Harveys unit offers the opportunity to extend the current unit by 4,840 sq ft. This extra space offers the potential to create one large unit extending to circa 15,140 sq ft or to subdivide into 2 units of circa 7,500 sq ft each.

We believe the proposals for a mixed use development, anchored by a Waitrose foodstore, on the site directly opposite will also significantly enhance the location’s attractiveness as a retail destination and help attract new occupiers to the pitch.

In addition, the scheme is let off relatively low rents, providing the potential for good levels of rental growth in the future.

TENANTS’ COVENANTS

The scheme is anchored by the 5A1 covenant of Dunelm. The most recent accounts for the individual tenants are as follows:

Tenant Year Ending Sales Turnover Pre-Tax Profit Net Worth D&B Rating (000’s) (000’s) (000’s) Property Portfolio 30/06/2013 n/a n/a -£46,746 N4 (No 15) Ltd 25/06/2012 t/a Harveys n/a n/a -£46,746 Dunelm (Soft Furnishings) 29/06/2013 £677,192 £106,426 £47,877 5A 1 Ltd 30/06/2012 £603,729 £96,562 £36,421 Hobbycraft Trading Ltd 24/02/2013 £119,104 £6,346 £48,952 5A 1 19/02/2012 £106,522 £11,519 £42,447 Night Realisations plc 24/12/2010 £256,131 £4,433 £26,048 O4 t/a Dreams plc 24/12/2009 £243,570 £17,900 £42,077 OPEN CONSENTED RETAIL PARK INVESTMENT HOME INVESTMENT LOCATION & RETAIL SITUATION TENANCIES ASSET MANAGEMENT PROPOSAL SUMMARY CATCHMENT WAREHOUSING & DESCRIPTION & PLANNING & COVENANTS & CONTACTS NEWQUAY ROAD RETAIL PARK, TRURO TR1 1XD IN TRURO

VAT INVESTMENT RATIONALE

The property has been elected for VAT and therefore VAT is payable. However, we anticipate the transaction • Limited supply of retail warehousing in Truro. will be dealt with as a TOGC. • Recently refurbished scheme let with an income weighted average unexpired lease term of 10.7 years. • Retail location to improve further with the development of a Waitrose foodstore and park and ride scheme opposite. • Let at affordable rents with good rental growth prospects. • Asset management potential to further enhance the tenant mix and add value.

PROPOSAL

We are instructed to seek offers based on an attractive net initial yield of 6.50% (assuming purchaser’s costs at 5.80%). This reflects a purchase price of £10,210,000 (Ten Million, Two Hundred and Ten Thousand Pounds), subject to contract and exclusive of VAT.

CONTACT DETAILS

Miles Marten Ellie Kirkby Tel: 020 7317 3777 Tel: 020 7317 3790 Mobile: 07770 748 290 Mobile: 07764 241 898 Email: [email protected] Email: [email protected]

Wilkinson Williams Heathcoat House 20 Savile Row London W1S 3PR

www.wilkinsonwilliams.co.uk

MISREPRESENTATION NOTICE. Wilkinson Williams LLP give 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 of representation or 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 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 the particulars to the fact that alterations have 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 an intending purchaser. 7. Descriptions of the property are inevitably subjective and the descriptions contained herein are given in good faith as an opinion and not by way of statement of fact. Plans are published for convenience of identification only and although believed to be correct, their accuracy is not guaranteed and they do not form part of any contract. April 2014. Designed and produced by Creativeworld Tel: 01282 858200