WAITROSE CROMER ROAD, NORTH WALSHAM, NR28 0NB
Prominent Foodstore Investment with 5 Yearly Fixed Uplifts to 3% per annum INVESTMENT OPPORTUNITY
• Situated in the affluent Norfolk market town of North Walsham.
• Prominent modern fit-for-purpose foodstore comprising 31,231 sq ft GIA with surface car park and dedicated dotcom / click & collect facility.
• Let to the undoubted 5A1 covenant of Waitrose Limited on a 20-year FRI lease until 7th October 2032 (12 years unexpired).
• Current passing rent of £488,634 per annum, reflecting £15.83 psf.
• The rent is subject to five yearly fixed uplifts to 3% per annum. The next uplift is October 2022.
• Tenant option to renew for a further 15 years at lease expiry.
• Freehold. • 1.03-acre site providing 154 surface car parking spaces (1:203 sq ft).
PROPOSAL
Offers sought in excess of £9,640,000 Net Initial Yield 4.75%
Running Yield – October 2022 5.51%
Running Yield – October 2027 6.39%
Subject to contract and exclusive of VAT. Yields are net of purchaser’s costs of 6.69%
WAITROSE North Walsham | 2
NEWCASTLE UPON TYNE SUNDERLAND CARLISLE
M1 A1(M) DURHAM
HARTLEPOOL
M25 MIDDLESBROUGH
M11 M1
RICHMOND M4 0 M25 SCARBOROUGH
BARROW-IN-FURNESS M4 A2 LANCASTER
HARROGATE A33 M20 YORKM2 A28
M3 M26 BLACKPOOL M25 M20 PRESTON BRADFORD LEEDS HULL BLACKBURN
M23 HUDDERSFIELD A28 A2 A3 BOLTON A31 SCUNTHORPE
A34 ST HELENS MANCHESTER LIVERPOOL
A26 SHEFFIELD A23 ELLESMERE PORT A272 LINCOLN CHESTER A24
WREXHAM STOKE-ON-TRENT NOTTINGHAM CROMER LOCATION North Walsham is an affluent market town in North Norfolk, A148 A140 located 19 miles (30.5 km) north of the city of Norwich and approximately 8.5 miles (13.7 km) south of coastal NORTH town, Cromer. SHREWSBURY KING’S LYNN WALSHAM TELFORD A47 LEICESTER NORWICH A47 The A149 runs through the North Walsham is well GREAT town and leads to Cromer connected by rail with WOLVERHAMPTON YARMOUTH to the north and towards regular services to Norwich PETERBOROUGH Great Yarmouth to the south. (25-minute journey time), In addition, the B1145 links Cromer (26-minute journey North Walsham to Norwich in A140 time) and a fastest journey the south. time to London of 2 hours BIRMINGHAM A1(M) 44 minutes. COVENTRY North Walsham is just 7 miles (11.3 km) from the North Norfolk Coast – a popular holiday destination. The area’s economy is boosted by the transient tourist population A14 that visit the beautiful coast, Broads National Park and NORTHAMPTON BURY A12 WORCESTER WARWICK ST EDMUNDS other stunning nature reserves and countryside. A14 CAMBRIDGE The town centre’s retailing provision is focused around Market Place, where occupiers include Boots, B&M and M1 HSBC as well as numerous independent retailers. HEREFORD IPSWICH
A1(M) M11 SITUATION STEVENAGE COLCHESTER The subject property occupies a prominent position on LUTON Cromer Road (A149), the main arterial route through North AMMANFORD GLOUCESTER Walsham. The store is 1 mile (1.7 km) from the town centre. MERTHYR TYDFIL M1 A12
Access to the site is directly from the A149. OXFORDM4 0
M25
M25 SWANSEA SWINDON
WAITROSE North Walsham | 3 M4 LONDON CARDIFF READING BRISTOL A33 BATH M20 M3 WESTON-SUPER-MARE WOKING M26 M2 BASINGSTOKE M25
M20 M23
A3 A31
A34 SOUTHAMPTON
BRIGHTONA26 A23
EXETER POOLE A272 PORTSMOUTH A24 BOURNEMOUTH
NEWQUAY
PLYMOUTH WEYBOURNE SHERINGHAM CATCHMENT & CROMER 5 minute drivetime A148 DEMOGRAPHICS A149 10 minute drivetime The property benefits from a loyal immediate catchment, with 47,064 10 minute drivetime people living within a 15-minute drive:
Drive Time Population Households A140 TRUNCH 5 minutes 10,840 5,078 SAXTHORPE NORTH 10 minutes 18,865 8,847 WALSHAM 1 2 15 minutes 47,064 23,053 NORTH WALSHAM
The surrounding population of North Walsham consists mainly of AYLSHAM3 families and older couples (66 and over) with strong roots in their local community. Home ownership is significantly above average (71.6% CAWSTON STALHAM compared to the UK average of 65%), with 43.7% of the occupying A140 detached houses, again well above the UK average of 22.8%. BUXTON
The population within a 10 minute drivetime is affluent, with the HEVINGHAM CATFIELD highest proportion of residents categorised within Experian’s ‘Country Living’ Mosaic Group. These are well-off homeowners living in the countryside with good incomes, either from well-paid NORWICH professional jobs or occupational pensions. FOODSTORE COMPETITION Foodstore competition in this area is limited; There is just one further competing foodstore there are only two competing food stores within within a 15-minute drive time. the primary 5-minute drive time (>8,000 sq ft):
1 Sainsbury’s, Bacton Rd, 3 Tesco, Norwich Rd, North Walsham NR28 9DS Aylsham NR11 6BW (40,160 sq ft net sales) (13,712 sq ft net sales)
2 Lidl, Yarmouth Rd, The closest Waitrose store is situated in North Walsham NR28 9AS Norwich, 19 miles (42 minute drive) to (16,870 sq ft net sales) the south.
WAITROSE North Walsham | 4 DESCRIPTION SITE AREA The property, originally a Focus DIY, was constructed in The site area is 1.0291 hectares (2.543 acres). 2004, before being refurbished in 2012 to accommodate Waitrose. The unit provides 31,231 sq ft of accommodation arranged over ground and first floor.
The store includes a meat and fish counter, delicatessen, PLANNING bakery and a café, as well as ancillary offices, staff The asset benefits from planning consent for use within and distribution areas. Over 1,000 sq ft is dedicated to Class A1, together with ancillary uses and car parking, processing home delivery orders and click-and-collect. and if required a post office, in-store bakery, pharmacy, restaurant and other uses falling within A2 and A3. Customer and service access is via a dedicated entrance from Cromer Road. Servicing is via an enclosed service yard to the east of the site. The first floor provides ancillary space for back of house purposes. TENURE The store benefits from 154 surface car parking spaces, The property is held freehold under title number providing a generous parking ratio of 1:203 sq ft. NK319025.
Waitrose opening hours are as follows:
Monday – Saturday: 8:00am – 8:00pm
Sunday: 10:30am – 4:30pm
ACCOMMODATION We understand that the property benefits from the following floor areas:
Floor GIA (sq ft) GIA (sq m)
Main Store 28,945 2,689.1
Entrance 708 65.8
First Floor 1,578 146.6
Total GIA 31,231 2,901.5 Title plan for indicative purposes only.
WAITROSE North Walsham | 5 TENANCY The property is let to Waitrose Limited on a 20-year full repairing and insuring lease from 8th October 2012 (12 years unexpired). The current passing rent COVENANT is £488,634 per annum, reflecting a low £15.83 psf, which was set at the fixed uplift in 2017. INFORMATION
The lease is subject to two further fixed uplifts as follows: Waitrose Limited Date Rent (per annum) Company Number: 00099405 Attractive income profile 8th October 2022 £566,461 with 5 yearly fixed uplifts Waitrose forms the grocery division of the John Lewis “ Partnership, Britain’s largest employee-owned retailer and one 8th October 2027 £656,683 at 3% per annum. of the top ten UK retailers. Waitrose operates 350 branches across the UK, employing 91,000 employees. At lease expiry the tenant has the option to renew the lease for a further 15 years. The initial rent under The company has a Dun & Bradstreet rating of 5A1 the further lease will be set on the basis of open Restrictive assignment provisions in the lease, representing a minimum risk of business failure and holds market value, subject to 5 yearly upward only rent ”with AGA required on assignment to tenant of a 4.7% market share (as at 09/08/2020), making it the 8th reviews fixed at 3% pa. lower financial standing. largest grocery retailer in the UK.
A summary of the last three years’ accounts are set out below:
25/01/2020 27/01/2019 28/01/2018 Year Ending £’000 £’000 £’000
Sales Turnover 6,235,000 6,226,100 6,121,300
Pre-Tax Profit 44,900 61,500 100,700
Net Worth 790,100 718,000 695,500
Highly sought after “Dun & Bradstreet covenant rating of 5A1.
” WAITROSE North Walsham | 6 INVESTMENT MARKET INVESTMENT The foodstore market has proven to be one of the most CONSIDERATIONS defensive and resilient sectors during this period and has seen increased investor demand driven by strong • Strategically situated in the affluent Norfolk market town of North Walsham, benefitting from a loyal trading performance, income security and guaranteed customer base. rental growth as a result of RPI linked / fixed reviews. The sector has witnessed strong liquidity, with c. £1.05bn of • Prominent, modern foodstore comprising supermarket asset transactions to date in 2020, against an 31,231 sq ft GIA, with dedicated dotcom and click investment backdrop of a flight to quality as investors seek and collect facility. safe havens. • Excellent security of income, let to the 5A1 covenant All of the major food retailers have benefited from sales of Waitrose Limited. growth due to increased consumption at home. Kantar estimate take-home grocery sales grew 14.4% in the 12 • Attractive income profile with 12 years unexpired, weeks to 9th August, slightly below July 2020 which broke subject to 5 yearly fixed increases to 3% per annum the record for the fastest period of growth since 1994. – providing guaranteed rental growth throughout Total sales across the grocery sector reached £31.6bn for the term. the period, with the average spend per supermarket trip of The foodstore market £25.05, 35% more than the same period last year, as people “has proven to be one • Tenant option to renew for a further 15 years at continue to eat more meals at home. of the most defensive lease expiry. Waitrose has witnessed strong sales growth, previously and resilient sectors. Freehold site of 1.03-acres, providing 154 surface outperforming the ‘big four’ operators. In the 12-week • caparking spaces (1:203 sq ft). period to August 9th, their sales growth increased by 9.7%. ” RECENT TRANSACTIONS In terms of transaction evidence we would highlight the following:
Area Unexpired Term Price Net Initial Date Property Address Tenants Rent Review (sq ft) (years) Achieved Yield
17 5 yearly RPI linked reviews Aug 2020 Telford Morrisons 42,500 £14.25m 4.98% (12 to break) (1% & 3% per annum compounded)
S&L Portfolio 20 5 yearly CPI linked reviews June 2020 Waitrose 192,000 £74.10m 4.40% (6 stores) (15 to break) (1% and 3% per annum compounded)
S&L Portfolio 20 5 yearly CPI linked reviews June 2020 Waitrose 165,000 £62.00m 4.30% (5 stores) (15 to break) (1% and 3% per annum compounded)
WAITROSE North Walsham | 7 VAT The property has been elected for VAT purposes and as such it is expected that the investment sale will be treated as a Transfer of Going Concern (TOGC).
EPC The property has an Energy Performance Rating of B (43).
IDENTITY CHECKS In order to comply with anti-money laundering legislation, the successful purchaser will be required to provide certain identification documents. The required documents will be confirmed to and requested from the successful purchaser at the relevant time.
PROPOSAL
Offers sought in excess of £9,640,000 Net Initial Yield 4.75%
Running Yield – October 2022 5.51%
Running Yield – October 2027 6.39%
Subject to contract and exclusive of VAT. Yields are net of purchaser’s costs of 6.69%
WAITROSE North Walsham | 8 FURTHER INFORMATION
Georgie Griffiths 020 7344 6611 07895 261540 [email protected]
Tom Edson 020 7344 6554 07766 657 478 [email protected]
Colliers International 50 George Street, London, W1U 7GA
MISREPRESENTATION ACT DISCLAIMER Colliers International gives notice that these particulars are set out as a general outline only for the guidance of intending Purchasers or Lessees and do not constitute any part of an offer or contract. Details are given without any responsibility and any intending Purchasers, Lessees or Third Party should not rely on them as statements or representations of fact, but must satisfy themselves by inspection or otherwise as to the correctness of each of them. No person in the employment of Colliers International has any authority to make any representation or warranty whatsoever in relation to this property. September 2020 . Colliers International is the licensed trading name of Colliers International UK Plc. Company registered in England & Wales no. 4195561. Registered office: 50 George Street, London W1U 7GA. Designed and produced by Parer Creative. Tel 07702 123482.
WAITROSE North Walsham | 9