Biffa Polymers
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BIFFA POLYMERS WES BUILDING, PLASTICS ROAD, WILTON, REDCAR, TS10 4RG FOR SALE Secure long income industrial investment opportunity with annual RPI linked rent review BIFFA POLYMERS WES BUILDING, PLASTICS ROAD, WILTON, REDCAR, TS10 4RG INVESTMENT SUMMARY • Let to Biffa Waste Services on a 15-year unbroken lease expiring 31 July 2035. (14.25 years unexpired). • Biffa Waste Services have a D&B rating of 5A 1 with shareholder’s funds in excess of £500m. • The lease is subject to annual rent reviews in accordance with RPI with a collar and cap of 2 & 4%. • 109,688 sq ft industrial facility. • Located on the Wilton International site on Teesside, one of the largest key manufacturing locations in the UK at circa 2,000 acres and home to a number of international companies. • Teesside is set to benefit from freeport status. • Current rent passing of £300,000 per annum reflecting a low overall rent of £2.74 per sq ft. • Seeking offers in excess of £4,650,000. • Virtual Freehold. • A purchase at this level will reflect a 6.00% Net Initial Yield assuming standard purchasers’ costs of 7.54%. • Low overall capital value of £42.40 per sq ft. A 8 D 7 A 1 RO 1 1 NK 8 A RU 5 T R E E D N 5 C 8 A A11 A L R L M D A A A N H O T E D R A A K E L O N K R U R R SUBJECT I LOCATION T W K P E O R A PROPERTY R T C C L N The subject property is located at Wilton International, Teesside, a A O R T G E A 2 4 N E R C S 0 conurbation surrounding Middlesbrough and the River Tees in North East E 1 4 E R W O D A 7 A A 1 D G O A R England. Wilton is situated to the north east of Middlesbrough some R A K F S N I S U S H L two miles from Teesport, the national trade hub. R A T P N O E A N ORTH RD 66 D N N 4 S 7 AD 66 O 6 1 R Access is served via the A174, which links directly to the A19, A1 and RO A 6 O 66 CKSIDE R A A A DO M A D A G N Y M1 (north-south). With Newcastle upon Tyne to the north and York to A R B DW E M Y A Y BO O ROUG A 6 R BR S the south. The A66 dual carriageway provides direct access to the A1(M) H R A6 D T R C D O T A N O R T E D N 5 R N G 108 U L linking Middlesbrough to the national motorway network. A N R A K K D 4 C R O R A O O E 7 O 1 B D A G R 5 F A N 08 D O 1 N L A L E WILTON O P E E R R T O M Teesside International Airport lies 16 miles to the west offering flights to L Y O A T R A A E RE INTERNATIONAL E H 1 M T N N S A T H 7 E B IG E H R N 2 Y B seven domestic and five European destinations. I S BY L R Y R D B O RD 4 A A Y 7 N D B 1 MIDDLESBROUGH AN A K Darlington Train Station is located 21 miles to the west which provides a RM F L M O E N A U T A N T E V R S shortest journey time of 2 hours 22 mins to London Kings Cross. A S KEI TH T U L O N N N N R Y F O I E A L 4 F D E 7 N D 1 L A A A L T E T AT S G D L Morpeth LA A N 1 E 7 174 A1 A696 A1 A Blyth NEWCASTLE PontelandPonteland A19 Whitley Bay D Gosforth A O R A69 K NEWCASTLE UPON TYNE N U R Jarrow T Gateshead SUBJECT A68 5 PROPERTY A1 Sunderland 8 65 A963 Washington A10 A692 64 Consett Stanley 63 Houghton le Spring A691 A19 D A O 62 R Durham NK U Peterlee R T Brandon A167 SUBJECT A68 61 Hartlepool PROPERTY Spennymoor A1(M) 5 Bishop Auckland A689 60 A19 A689 8 A10 REDCAR A 1053 6 59 A6 A688 MIDDLESBROUGH G R E Darlington Y Y A S TEESSIDE W T D O WILTON 57 Whitby A A66 N RO B E 56 R O INTERNATIONAL A19 A D A172 Located on the Wilton International site on Teesside, one of the largest key manufacturing locations in the UK SABIC LDPE Alpek SABIC BIFFA WILTON REDCAR Plant Huntsman Plant Olefins 6 POLYMERS W11 EfW Ensus UK Enva INTERNATIONAL A174 A174 A1085 A1085 To Middlesbrough FREEPORT STATUS Teesside has been selected as one of eight Freeports in England. Areas given Freeport status will benefit from a wide package of tax reliefs, simplified customs procedures, streamlined planning processes to boost redevelopment and government support to promote regeneration and innovation. The Teesside freeport will be the largest in the UK covering some 4,500 acres. It is estimated the new status will have boosted the local economy by £3.2bn by 2026. As well as Wilton International the status covers Teesworks, Teesside International Airport, the Port of Middlesbrough, the Port of Hartlepool, Liberty Steel and LV Shipping. WILTON INTERNATIONAL Wilton International is one of the UK’s leading manufacturing Alpek Polyester UK, CropEnergies Ensus, Nippon Gas, Anglo sites. At almost 2,000 acres, the site in the North East England Woodsmith and UK Wood Recycling. Over the years, these is one of the largest industrial locations in the UK. High quality companies have invested over £2 billion in moving to and products made at Wilton are of national importance and expanding their operations in the area. generate hundreds of millions of pounds in export revenues for the UK economy each year. The region contributes more than £10 billion to the national economy every year. The Tees Valley is also a major centre Due to substantial historic investment in onsite utilities for the offshore wind supply chain and home to a nationally infrastructure Wilton is able to offer manufacturing and important logistics hub to support international trade moving industrial occupiers some of the lowest cost power and heat in goods in and out of the UK. the UK. An increasingly green multi-company manufacturing site, Wilton boasts a number of major international companies Wilton International is a leader in sustainable power production such as: Biffa Polymers, Sembcorp Utilities UK, SABIC UK featuring biomass and energy from waste assets as well as Petrochemicals, Huntsman Polyurethanes, bioethanol for greener road fuel. DESCRIPTION The property comprises a large manufacturing and production unit extending to 109,688 sq ft over ground floor only. The building was built in the 1960’s of steel frame with part brick and part metal sheet cladding beneath a mainly metal clad roof. The main warehouse area provides two distinct open plan areas. Both areas are of a pitched roof with a maximum eaves height of 8.8m and 12.7m respectively. The property benefits from a total of six loading doors. There are two secure yards either side of the building with ample car parking to the front. The office accommodation forms approximately 5% of the total space and comprises a number of partitioned meeting rooms, as well as a board room and staff break out area. SITE The subject facility occupies a site of 4.97 acres (2.01 hectares). ACCOMMODATION The property provides the following Gross Internal Area (GIA): Demise sq m sq ft Front Office 5.7 56.75 323 3,482 6 34.5 207 2,228 Lower Eaves Warehouse 75.09 56.75 4,261 45,869 Higher Eaves Warehouse 67.9 61 4,142 44,583 Side Loading Area 18.4 5 92 990 Rear Labs/Ancillary 17.32 3.6 62 671 Total 10,190.34 109,688 TENURE The investment is available by way of a new long leasehold interest with the vendor granting a new 999 year headlease to the purchaser at a peppercorn rent. TENURE STRUCTURE The vendor has got some minor management obligations with the tenant, which are personal to the vender (Sembcorp). Sembcorp will continue to provide these, post transaction, and in order to mitigate the new purchaser’s management obligation we will create a new lease to sit above Biffa and below the purchaser. All tenant rent payments will be directed straight to the purchaser. The structure is set out below: SEMBCORP UTILITIES (UK) LIMITED (FH) PURCHASER (999 YEAR FH) SEMBCORP UTILITIES TENANCY RENT (UK) LIMITED (TENANT) The property is let to Biffa Waste Services Limited on a 15 year MANAGEMENT lease from 1st August 2020 expiring 31 July 2035. (14.25 years OBLIGATIONS unexpired) at a passing rent of £300,000 pa. BIFFA WASTE SERVICES The rent is reviewed annually in accordance to RPI with a collar LIMITED (SUB-TENANT) and cap of 2 & 4%. The lease is drafted outside of Sections 24-28 of the Landlord and Tenant 1954 act on full repairing terms, subject to a Upon expiry of the Biffa lease, the management obligations will fall schedule of condition.