West George Street Glasgow G2

West George Street

Glasgow G2 2LB

PRIME MULTI-LET OFFICE INVESTMENT WITH ASSET MANAGEMENT OPPORTUNITIES

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West George Street

Glasgow G2 2LB

Investment Summary

• Prominent multi-let office building located in Glasgow’s CBD. • Provides a total of 1,834.18 sq m (19,744 sq ft) of good quality open plan office accommodation arranged over lower ground, ground and seven upper floors. • Asset management potential. • Rents ranging from £13.00 - £15.00 per sq ft. • Heritable Interest (Scottish equivalent of English freehold). • Seeking offers in excess of £2,800,000 exclusive of VAT reflecting a net initial yield of 9.90% assuming standard purchaser’s costs based on LBTT. Click the buttons below to navigate

J18 COWCADDENS

REN T FRE E W ST E REET R CHARING CROSS T S STATION S D AU CHIE T O HAL E T L S E O TR E EET E TR T W BAT R S H S E ST T R E E H ET E S R T L I T S Y S L N A W L B E T T ST RE S T T G G I EN QUEEN STREET E S T U S P TRE STATION W ET W N O E ST GEO EXHIBITION CENTRE O D RG T E STR STATION S EET E I T N T B E T Location OT E N H E W E E I E LL R F ST R E R T E R ET T S S T CL YD S ESI W L N BUCHANAN STREET DE AT L E and Buchanan Street are also a short E ER O ST one77 West George Street has a X LO E P V PRE O S T INCE SS TR B O N W E G T A ET P ST Y H RE distance away. Additionally frequent bus N ET prominent position on the south side of I T ANDERSTON M T L E SECC E A L E STATION E C services run along West Regent Street E R

R West George Street between Wellington THE HYDRO T T W T S S S E and Wellington Street. Road connections T Street and Hope Street in the heart of

N N CENTRAL E W A

O E

CLYDE I STATION N R Glasgow’s Central Business District. are excellent with easy access to the AUDITORIUM N A T

U S H C M8 and wider motorway network via N U E B E

U LA J19 T This city centre location provides junctions 18 and 19. NC E ARG Q E Y EFIE T LE S R T LD E REE excellent access to Glasgow’s public E QUAY T T S R

A D one77 West George Street is ideally N S transport network. Glasgow Central and DE BBC HQ RSTON L ST ENOCH QUAY A A BROOMIELAW C I located in close proximity to Glasgow’s W Queen Street train stations are within a A STV HQ S E O M prime retail and leisure pitches including RIV A few minutes walk of the property, and D J IFIC PAC subway stations such as Cowcaddens Buchanan Street and Sauchiehall Street.

GO VA N RO AD

EST AD W EY RO PAISL Click the buttons below to navigate

Description

one77 West George Street extends to approximately 1,834.18 sq m (19,744 sq ft) over lower ground, ground and seven upper floors with the benefit of a central atrium that extends the full height of the building. The building also has secure parking located at lower ground floor, which can be accessed via West George Lane.

The accommodation comprises modern, open plan offices arranged in front and rear wings over ground to 6th floors, each with male and female toilet facilities accessed by a communal corridor. The 7th floor only extends over the front wing of the building but benefits from its own roof terrace and unisex toilet.

The accommodation benefits from the following specification:

• Raised access floors • Suspended ceilings • Gas central heating • Comfort cooling cassettes (in part) • Dedicated male and female toilet facilities on each floor • Refurbished communal areas • Secure private parking • Commissionaire • 24 hour access • 1 x 13 person passenger lift • Disabled access Click the buttons below to navigate

Surrounding ST ENOCH CENTRE Occupiers

1 THE WEIR GROUP, ST ENOCH CMS CAMERON MCKENNA, SHEPHERD & WEDDERBURN PRINCES 2 BRODIES, DELOITTE, ARMANI SQUARE 2 GRANT THORNTON, DWF

CENTRAL 3 CAPITA GEORGE STATION SQUARE 4 LLOYDS BANKING GROUP 5 REGUS 6 STANDARD LIFE 3 9 QUEEN STREET 8 STATION 7 RBS 13 8 CIGNA 10 18 9 SCOTTISH & SOUTHERN ENERGY 4 11 BUCHANAN STREET 10 HYMANS ROBERSTON 7 ASHURST 1 5 15 11 SCOTTISH ENTERPRISE 12 GLASGOW 14 12 SKYSCANNER, NETWORK RAIL 13 JP MORGAN 6 14 STUDENT LOANS COMPANY 15 JACOBS ENGINEERING GROUP 17 16 UNITE THE UNION 17 CUSHMAN & WAKEFIELD

BLYTHSWOOD SQUARE Click the buttons below to navigate

Glasgow

Glasgow is Scotland’s largest city with a population of nearly 600,000 and the third largest in the UK. The city has an extensive catchment of over 3 million people. There are 1.2 million eligible to work within a 45 minute commute of the city and 2 million within an hour. It is Scotland’s largest centre of employment, specialising in sectors such as financial and business services, health, education, retail, tourism and hospitality. Glasgow has a highly educated workforce with over 130,000 students attending the five higher education institutions and the three super colleges making it an attractive destination for business.

Glasgow contributes approximately 18 billion GBP in Gross Value Add to the Scottish economy annually and according to The Global Financial Services Index 2015 it is in the top 20 European Financial Centres. Almost 17,000 companies make their home in Glasgow; together they generate a turnover of 31,101 million GBP each year. Glasgow is rapidly becoming a smart city of the future, positioning itself at the forefront of technology integration and application.

The city benefits from an excellent road and rail network, with the M8 linking the city to Edinburgh in the east, the A80 / M80 to the north and the M74 to the south. It is also within an hour’s drive of three international airports and is the only UK city out with London to have its own subway. The city also has an extensive public transport network offering frequent train and bus services. It is served by two main railway stations; Glasgow Central and Queen Street. In addition to providing local services throughout central Scotland, these stations offer links to the main cities throughout the UK and all the major Scottish centres. Click the buttons below to navigate

Accommodation

The property has been measured in accordance with International Property Measurement Standards Three (IPMS 3) and with the RICS Code of Measuring Practice (Sixth Edition). We estimate the net internal areas to be as follows:

AREAS (Sixth Edition) AREAS (IPMS 3) sq m sq ft sq m sq ft Seventh Floor N/A N/A 27.39 295 (Roof Terrace) Seventh Floor 100.24 1,079 101.02 1,087 Sixth Floor 236.62 2,547 239.50 2,578 Fifth Floor 237.09 2,552 239.69 2,580 Fourth Floor 238.67 2,570 241.26 2,598 Third Floor 236.53 2,546 239.13 2,576 Second Floor 237.46 2,556 240.25 2,586 First Floor 233.56 2,514 238.76 2,570 Ground Floor 179.67 1,934 183.20 1,972 Lower Ground 134.34 1,446 136.20 1,466 TOTAL 1,834.18 19,744 1,886.40 20,308

The building also has the benefit of 4 dedicated secure car parking spaces.

Typical Floor Plan Click the buttons below to navigate

Tenancy Schedule

Floor Tenant Floor Area Net Current Rent psf Lease Expiry Lease Break Comments (sq ft) Rent pa

7th Gilkes Energy 1,079 £13,750 £12.75 31/03/2019 31/01/2017 Schedule of condition. Service charge cap. If the break option is not served the tenant is to receive 6 months rent free. Lease guaranteed by Gilbert Gilkes & Gordon Limited. 6th (front) Royal College of Nursing 1,328 £24,841 £16.82 16/03/2018 Includes 1 car parking space. 6th (rear) Rental Guarantee 1,219 £18,285 £15.00 2 year rent, rates & service charge guarantee. 5th (front) HSB Engineering Ltd 1,330 £20,597 £13.61 18/03/2024 18/03/2019 Paying half rent until 18/09/2016 – Vendor will provide a rental top up until this date. Service cap charge. Rent review on 19/03/2019. If the break option is not served the tenant is to receive 6 months rent free. Includes 1 car parking space. 5th (rear) Bank of England 1,222 £20,281 £16.60 05/03/2018 4th (front) Waterman’s 1,332 £18,872 £14.17 18/01/2025 19/01/2022 Schedule of condition. Solicitors Ltd Paying half rent until 18/01/2017 – Vendor will provide a rental top up until this date. If the break option is not served tenant pays half rent for 24 months. Rent review 19/01/22. 4th (rear) Rental Guarantee 1,238 £18,570 £15.00 2 year rent, rates & service charge guarantee. 3rd (front) CBA QS Ltd 1,318 £21,386 £14.33 01/02/2020 Service charge cap. Includes 1 car parking space. 3rd (rear) Rental Guarantee 1,228 £18,420 £15.00 2 year rent, rates & service charge guarantee. 2nd Rental Guarantee 2,556 £38,340 £15.00 2 year rent, rates & service charge guarantee. 1st Rental Guarantee 2,514 £40,210 £15.00 2 year rent, rates & service charge guarantee. Includes 1 car parking space. Ground (Front) Rental Guarantee 773 £10,049 £13.00 2 year rent, rates & service charge guarantee. Ground (Rear) Rental Guarantee 1,161 £15,093 £13.00 2 year rent, rates & service charge guarantee. Lower Ground Energis Communications Ltd 1,446 £15,000 £10.37 02/02/2017

Totals 19,744 £293,694 Click the buttons below to navigate

Covenant Information

The existing tenants have a mix of covenant strengths as shown below:

COMPANY Experian Score Credit Risk out of 100 Limited

Gilkes Energy Limited 25 £3,300 High

The Royal College of Nursing of 80 £200,000 Below the United Kingdom Average Risk HSB Engineering Insurance 100 £1,900,000 Very Low Risk Limited Bank of England 100 £10,000,000 Very Low Risk

Watermans Solicitors Limited 80 £50,000 Below Average Risk CBA QS Limited 87 £53,000 Low Risk

Energis Communications Limited 28 £15,000 Above Average Risk Click the buttons below to navigate

Glasgow Office Market

In 2015 there was 533,647 sq ft of take up in the Glasgow occupational market, the third best year since 2007. The Glasgow occupational market improved after a subdued Q2 and Q3 in 2015, an increase in grade A take-up pushed the Q4 volume to 207,000 sq ft, 58% above the five year average. The increase in grade A takeup was largely down to three deals: DWF, which took 18,350 sq ft at 110 Queen Street, KPMG, which took 40,000 sq ft at St Vincent Plaza, and CMS Cameron Mckenna, which took 21,000 sq ft at 1 West Regent Street.

Occupier confidence is strong, particularly for smaller lot sizes, with 16 deals completed in Q4 2015 alone under 3,000 sq ft with a number of further deals expected to be signed in Q1 which would contribute to a positive H1 performance in 2016. The Glasgow office market has seen an increase in the number of smaller requirements that are ideally suited to take space at one77 West George Street.

This strong demand from small-medium sized businesses for good quality Grade B 110 Queen Street St Vincent Plaza 1 West Regent Street accommodation provides good supply and demand dynamics for rental growth and lower incentive packages going forward. uatel ake b ae s t

Key Leasing transactions: Building Tenant Area (sq ft) Date 1 West Regent Street Shepherd & 13,702 Q4 2015 Wedderburn 1 West Regent Street CMS Cameron 21,206 Q4 2015 McKenna 110 Queen Street DWF 18,350 Q4 2015

St Vincent Plaza KPMG 39,705 Q4 2015

110 Queen Street WSP Group 10,544 Q4 2015 Pacific House Big Lottery 12,142 Q4 2015 Fund ae ae ae C ive ea veage Granite House House of Fraser 8,800 Q4 2015 Source: Cushman & Wakeﬁeld Click the buttons below to navigate

Net Capital Investment Market Overview Address Date Purchaser Price Initial Value Comment Yield psf Glasgow is a major regional office centre and 389 March Under Asking Asking 40,979 sq ft, multi-let attracts investment in commercial property from Argyle Street £91 2016 Offer £3.75m 11.04% investment. UK Institutions, overseas funds and high-net worth Glasgow individuals. It is one of the top 6 regional cities in the 27,375 sq ft, six storey office UK with prime yields now at 5.25%. Glasgow offers a 33 February building within IFSD. Tenants discount in comparison to other regional cities, with Bothwell Street Cordatus £6.98m 6.62% £254 2016 include Starbucks and Chase yields in Birmingham and Manchester sitting at Glasgow Devere. circa 5.00%. Monteith House 27,000 sq ft, multi-let office November It was a record year for the Glasgow office market George Square DRIP £5.75m 7.60% £212 investment. AWULT 5 years to 2015 in 2015 with £429m of investment transactions Glasgow expiry 4.09 to breaks. taking place compared with only £215m in 2014. The 56,771 sq ft, single let office 51 previous high was set in 2006 where £418m of office October Northwood investment to Bank of Scotland West Campbell Street £12.8m 9.36% £225 investments were transacted. 2015 Investors Plc. Lease expiring 2023, subject Glasgow to tenants break option in 2018.

133 September 60,377 sq ft, multi-let office Finnieston Street Squarestone £6.45m 9.84% £107 2015 investment, with 34% vacancy. Glasgow

163 32,947 sq ft, multi-let office September RWM Capital West George Street £8.7m 6.50% £264 investment. AWULT of 5.5 years 2015 (Russia) Glasgow to expiry.

140 September 22,883 sq ft, multi-let office West George Street L&G £5.71m 6.75% £250 2015 investment. Glasgow

180 August 52,099 sq ft, multi-let with West George Street Picton UK £14.25m 7.80% £273 2015 AWULT of 2.55 years to breaks. Glasgow

225 87,827 sq ft, multi-let office August Bath Street AEW £12.2m 10.00% £139 investment with WAULT of 4.91 2015 Glasgow years to expiry. 51,305 sq ft, multi-let office 180 August Northwood investment. AWULT of 4.36 St Vincent Street £11.9m 7.00% £232 2015 Investors years to expiries and 2.86 years Glasgow to breaks. Click the buttons below to navigate

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).

West George Street

Glasgow G2 2LB Proposal

We are instructed to seek offers in excess of £2,800,000 (Two Million Eight Hundred Thousand Pounds Sterling) Service Charge subject to contract and exclusive of VAT. A purchase at this level would reflect an attractive net initial yield of 9.90% assuming standard purchaser’s costs based on LBTT. A copy of the service charge budget for 2016/2017 can be provided on request. For further information or to arrange an inspection please contact: EPC

Copies of the EPC’s are available on request.

Tenure Stuart Low Stuart Spalding 0141 223 8797 07717 178 284 Heritable Interest (Scottish Equivalent of freehold). [email protected] [email protected]

Cushman & Wakefield LLP on their own behalf and for vendors or lessors of this property, whose agents they are, give 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 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: March 2016.