FREEHOLD WAREHOUSE INVESTMENT Halesfield 11, Telford, TF7 4LZ

CeDo Production Facility FREEHOLD WAREHOUSE INVESTMENT CEDO PRODUCTION FACILITY HALESFIELD 11, TELFORD, TF7 4LZ

Investment Summary

n Freehold Warehouse Investment

n 183,450 sq ft high bay warehouse

n 8.2m rising to 19.2m eaves height

n 10.2 acre site (41% site cover)

n Let to CeDo Ltd

n CeDo Ltd have been in occupation for over 30 years

n £3.5 million profit, £33.7 million shareholders’ funds (12/2015)

n 10 year lease from 14 June 2016

n Annual 2% rent increase

n Tenant break on 14 June 2021

n Estimated cost to tenant of break £890,000

n Current rent £612,000 pa - £3.36 psf

n Offers in excess of £6.5 million subject to contract

n Net Initial Yield – 8.82 %

n Reversionary Yield (6/2025) – 10.34%

2 FREEHOLD WAREHOUSE INVESTMENT CEDO PRODUCTION FACILITY HALESFIELD 11, TELFORD, TF7 4LZ

3 29 A617

17 A6 A617 M6 A38 A34 A515 28

16 A500 A53 A523 A614 A520 M1 Newcastle-under-Lyme A52 A610 A38

LONGTON A6 26

15 A52 A53 Stoke-on-Trent A51 A515 Nottingham A34 A520 A50 A52 A51 Derby 25 FREEHOLD WAREHOUSE INVESTMENT CEDO PRODUCTION FACILITY HALESFIELD 11, TELFORD, TF7 4LZA52 M6 A453 A606 A518 A34 A51 A50 A38 A511 24 14 Burton upon Trent Staord A6 A515 A42 A518 A53 Newport A511 13 M1 A6 A442 A34 A38 Location A41 A444 Shrewsbury M6 A460 A51 A42 A511 A5 Telford is a large town in the county of Shropshire located 15 miles 22 5 4 A46 Lich eld A50 to the east of Shrewsbury and 27 miles North West of Birmingham A464 A449 Telford 3 11 M54 2 M6 Toll Tamworth city centre. 1 A34 M42 Leicester A5 A444 A49CEDO PRODUCTION FACILITY A41 A442 10 Walsall 21 A563 Wolverhampton 10 A6 The town has a population of around 155,000 and is the largest town A458 A454 Sutton A5 Bridgnorth 8 Cold eld M69 in Shropshire and one of the fastest growing towns in the United A449 A38 Kingdom. It is a new town, named after engineer Thomas Telford, M6 1 M1 and was built under the guidance of the Telford Development 1 6 5 2 Corporation between the mid 1960’s and late 1980’s. A458 Birmingham 4 A5 M6 3 A442 A45 20 M5 A45 2 A38 A444 M6 The town is served by rail from Telford Central Station where trains A34 M42 Coventry 1 19 A491 A46 A452 A45 A14 run to Birmingham New Street every half an hour with a fastest 4 A5 Kidderminster Rugby 2 journey time of 37 minutes. There is also a twice daily direct service A456 3 A45 M42 3A A46 18 to London Euston with a 2 hour 12 minute journey time. A441 M5 M40 Royal A423 A448 Redditch Leamington M1 5 Warwick Spa

Access by road is via the M54 motorway which links the town to 15 Daventry junction 10A of the M6 motorway 16 miles to the east. 5 Telford 4 M54 Bishops Wood Brewood A442 A464

Situation 11 Stirchley 3 The Halesfield Industrial Estate is located to the south east of the A4169 town and is the largest estate in Telford. Albrighton M6 A4169 M54 A464 2 1 The subject property is on Halesfield 11 and benefits from direct dual Madeley A41 carriageway access via the A442 and A464 to junction 4 of the M54 motorway 3 miles to the north. CEDO PRODUCTION FACILITY Ryton Sutton Maddock A460 A41

A442 Kingslow Wolverhampton Pattingham Perton A454

A454 4 Catstree A449 FREEHOLD WAREHOUSE INVESTMENT CEDO PRODUCTION FACILITY HALESFIELD 11, TELFORD, TF7 4LZ

Description The property was built in two phases with the offices and main production area built in the 1970’s and the rear high bay warehouse built in the early 1990’s.

The property comprises an 88,000 ft² production building with a 13.5m (44ft) eaves height central section and two flanking 8.2m (27ft) eaves height sections. It is used for manufacturing plastic products and production lines for rolling, separating and packaging.

The warehouse building comprises a 38,000 ft² very high bay area with a 19.2m (63ft) eaves height which is fully racked and a 23,000 ft² high bay area with an 11m (36ft) eaves height which is part racked and part used as a loading platform.

The warehouse could be used as a cross docked facility with large loading yards at each end, though the tenant does not use it in this configuration.

There is a two storey office building along the northern elevation which is fully occupied with Cedo Ltd’s head office functions.

5 El Sub Sta FREEHOLD WAREHOUSE INVESTMENT CEDO PRODUCTION FACILITY HALESFIELD 11, TELFORD, TF7 4LZ Halesfield

95.7m

B 1

H A L 10 E

D 1 L F A IE I SF E Accommodation E L AL D H 1 El Sub Sta 1 The property had been measured in accordance with the 6th edition of the RICS Code of Measuring Practice as having the following Gross Internal Floor Areas:

El Sub Sta 6 sq m sq ft A Main Production Ground Floor 8,207.1 88,325

Subway

8 A Building Mezzanine 720.0 7,749 105.6m NE LDA Connecting Building 1,374.0 14,787 HA High Bay Warehouse 5,892.2 63,424 Offices 851.6 9,165 17,044.9 183,450

F F

c y d a r B

T A U e l & h t t c s dy a y n o B P C C P ro C o Site Area B t & ns o C o C 10.2 acres (4.1 Hectares).

106.6m

Tenure

Freehold. y a bw Su

d Un

4 4 2

0m 25m 50m 75m 6

Tenancy The property is let to Cedo Ltd for a term of 10 years from 14 June 2016 until 13 June 2026 at a current passing rent of £612,000 per annum. The rent is increased by 2% annually on the 14 June. There is a zero rent period between 14 June 2021 and 13 June 2022.

Tenant Break

The tenant has an option to break on 14 June 2021 on not less than 12 months notice, subject to reinstatement preconditions. The estimated cost of compliance with these preconditions is £890,000. Further information available.

Covenant The tenant, Cedo Ltd, reported the following results for the last 3 years: Y/E 31.12.15 Y/E 31.12.14 Y/E 31.12.13 Turnover £97,483,000 £93,078,000 £94,914,000 Profit before tax £3,461,000 £5,932,000 £6,798,000 Shareholders’ Funds £33,670,000 £36,090,000 £31,489,000

Cedo is the largest manufacturer of own label and branded household disposables in Europe.

Cedo household products include food and freezer bags, cling films, aluminium foil, bin liners, refuse sacks, hygiene disposal and bio-degradable bags. The Telford factory employs over 400 people on a three shift, 24 hour production program.

7 FREEHOLD WAREHOUSE INVESTMENT CEDO PRODUCTION FACILITY HALESFIELD 11, TELFORD, TF7 4LZ

Income

Date Rent Yield 14 June 2017 £612,000 per annum 8.82% 14 June 2018 £624,240 per annum 9.00% 14 June 2019 £636,725 per annum 9.17% 14 June 2020 £649,459 per annum 9.36% 14 June 2021 a peppercorn 0.00% 14 June 2022 £675,697 per annum 9.75% 14 June 2023 £689,711 per annum 9.94% 14 June 2024 £702,995 per annum 10.14% 14 June 2025 £717,055 per annum 10.34% Average £589,709 per annum 8.50%

Rental Value The current lease was agreed in June 2016 on a rising rent that averaged £3.21 per sq ft over the term of the lease. Due to a lack of development and take up of existing space there is a shortage of available warehousing space in Telford.

We consider the property rack rented at the passing rent and that there is good potential for rental growth.

EPC The property has an EPC rating of F147. We are advised that this can be improved to a D79 rating by removing the mezzanine and upgrading lighting to T8 lamps in the warehouse.

8 FREEHOLD WAREHOUSE INVESTMENT CEDO PRODUCTION FACILITY HALESFIELD 11, TELFORD, TF7 4LZ

Proposal

We are seeking offers in excess of £6,500,000 (six million five hundred thousand pounds) subject to contract for the freehold interest. A purchase at this price would show a net initial yield of 8.82% after purchase costs of 6.64%, a reversionary yield of 10.34% in 2025 and an average yield of 8.50% over the term of the lease.

Contact

JAMES BOATMAN James Boatman Chartered Surveyors 020 7409 0409 21 Woodstock Street, London W1C 2AP 020 7409 0409 [email protected]

Disclaimer: James Boatman Chartered Surveyors on behalf and for the Vendors or Lessors of this property whose Agents they are, give notice that: 1. These particulars are set out as a general outline only for guidance to intending Purchasers or Lessees, and donot constitute any part of an offer or contract. 2. Details are given without any responsibility and any intending Purchasers, Lessees or Third Parties 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 3. No person in the employment of James Boatman Chartered Surveyors has any authority to make any representation or warranty whatsoever in relation to this property 4. Unless otherwise stated, all prices and rents are quoted exclusive of VAT. June 2017. 9 Designed & Produced by CORMACK 020 7620 1205 www.cormackadvertising.com