Sunniside Leisure Sunderland Modern Multi-Let Leisure Investment Well Let with 90% of Income Secured to Strong Covenants with Minimum Risk of Failure

SUNNISIDE LEISURE SUNDERLAND MODERN MULTI-LET LEISURE INVESTMENT WELL LET WITH 90% OF INCOME SECURED TO STRONG COVENANTS WITH MINIMUM RISK OF FAILURE

64% OF INCOME WITH FIXED UPLIFTS INVESTMENT SUMMARY ■■ Modern multi-let leisure investment situated in the heart of Sunderland City Centre in close proximity to the newly refurbished Bridges Shopping Centre ■■ National operators Empire Cinemas (guaranteed by Cine-UK), Grosvenor Casinos, Frankie & Benny’s and Nando’s ■■ Let to 7 tenants and currently producing £988,624 per annum ■■ Low average passing rent of £11.95 psf ■■ 12 screen cinema with in excess of 550,000 admissions per annum ■■ Well let with 90% of income secured to strong covenants with minimum risk of failure ■■ AWULT of 16.1 years to expiry and 14.4 years to breaks WE ARE SEEKING OFFERS IN EXCESS OF ■■ 64% of income has fixed uplifts ■■ Free 650 space car park £12,900,000 (TWELVE MILLION NINE ■■ Asset management opportunities with existing tenancies HUNDRED THOUSAND POUNDS) ■■ Low Capital Value of just £141 psf WHICH PRODUCES THE FOLLOWING ■■ Part listed façade meaning nil rates liability on voids YIELD PROFILE: under current legislation NIY: 7.25% RUNNING YIELD SEPTEMBER 2014: 7.75% RUNNING YIELD AUGUST 2016: 7.87% WHITLEY BAY NEWCASTLE PONTELAND INTERNATIONAL A19

A696 A1

A1058 E T ASINGTON STREET E E TR A69 S F H A SOUTH SHIELDS C W EE R HEBBURN B R EA NORTH I N NEWCASTLE-UPON-TYNE R SEA G M

A194 D T O R O A1 IM U N D T SUNNISIDE O R N H O GATESHEAD A1018 S RIVER WEAR B LEISURE T W R R NK E I A D B E S SUNNISIDE T G PA NN E ET STRE A194(M) LEISURE ST MARY’S EAR W. W A694 VAUX BREWERY SITE CARPARK A1018 SUNDERLAND A1231 A1231 AY S W WASHINGTON Y ’ 64 . MAR TRAVELODGE ST

TEN PIN BOWLING T W R REE A693 H ST A183 63 HIG FO D A

O W R LK

N A19 O O CHESTER- T L H Y A690 R LE-STREET A1(M) S

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E ET W E R ST E L S A T I OM H . T ST A

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E BRIDGES SHOPPING CENTRE R

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PREMIER INN I M H I TRAVELODGE C D H OA A H R E G UNIVERSITY CITY BOROU L HOLMESIDE

OF SUNDERLAND S

W CENTRE

LOCATION A183

Sunderland is a major provides regular rail services to TO AD O W ER R T ARD ROAD conurbation in the north-east of Newcastle, Manchester, Leeds, HES C

AD Birmingham and Edinburgh. RN PARK ROAD England, situated approximately BU O MOWBRAY R

PARK N 14 miles south of Newcastle, Journey time to London Kings

A690 S D T

D O R 11 miles south of Gateshead, Cross is approximately 3 hours A U C O K B R T

9 miles east of Washington and 20 minutes. In addition, Sunderland L O

A N

A T

O S R

R O 38 miles north of Middlesbrough. benefits from the Tyne and Wear N

T D

Metro light rail system, with 60 H

Sunderland benefits from good U D ROA K R D A stations connecting passengers P road communications, being to the heart of both Newcastle close to the A1(M) and A19 and Sunderland city centres, which provide direct links into Gateshead, North and South Newcastle Upon Tyne to the north Tyneside and Newcastle Airport. CATCHMENT & and Darlington to the south. The The Metro has been rated as one city has a primary catchment of the country’s most efficient population of approximately modes of transport and currently DEMOGRAPHICS 372,000 and a catchment of carries nearly 40 million passenger 830,734 within 10 miles of the THE AGE PROFILE OF THE SUNDERLAND journeys per year. Nexus is PRIMARY CATCHMENT POPULATION city centre. INCLUDES A RELATIVELY HIGH PROPORTION currently investing £385 million in 372,000 830,734 OF THE RETIRED AGED 65 AND OVER; YOUNG The property is located upgrading the system. THE TOTAL POPULATION WITHIN APPROXIMATE POPULATION THE SUNDERLAND PROMIS WITHIN 10 MILES OF THE ADULTS AGED 15-24 ARE ALSO OVER- approximately 250 metres from PRIMARY CATCHMENT AREA CITY CENTRE REPRESENTED. Sunderland train station which SUNDERLAND UNIVERSITY

PREMIER INN TRAVELODGE CLOWNTREE BRIDGES LEISURE SHOPPING CENTRE CENTRE

MAIN SHOPPING DISTRICT

JOPLINGS DEPT STORE PRIMARK

TEN PIN BOWLING TRAVELODGE VAUX BRIDGEHOUSE BREWERY SITE SUNNISIDE ST MARY’S LEISURE CAR PARK

ECHO 24

RIVER WEAR

SITUATION The property is situated on Way (A183) at the junction of In additon, a modern 82 bed As part of the Local Authority’s 15 year High Street West in the heart of Bridge Street. Travelodge hotel opened in master plan for Sunniside East, land Sunderland’s principal leisure November 2012. to the east of the subject property Wearmouth Bridge provides a link destination, approximately is destined for future mixed use to the northern part of the city, the The Bridges Shopping Centre, owned 250 metres to the north-east development incorporating retail, Stadium of Light and the Sunderland by Land Securities, is located less than of the station. The primary office and commercial business space. Aquatic Centre. 340 metres south west of Sunniside. frontage to the property is on to The scheme, comprising 500,000 sq ft is High Street West, leading onto The scheme benefits from being anchored by, amongst others, Primark, Lambton Street. To the north of adjacent to a modern tenpin bowl, Debenhams, Top Shop, H&M, Dorothy the development is West Wear operated by 1st Bowl, adding critical Perkins, Superdry, River Island and Boots. Street (A1018) linking St Mary’s mass to this leisure destination. CITY PROFILE Despite current economic ■■ The location for a new conditions, Sunderland has recently 500,000 sq ft central business benefited from numerous private- district, the 26 acre former sector investment projects creating Vaux Brewery site, has been over 3,500 jobs and attracted the acquired by the council, and is first Enterprise Zone investment. being enhanced in preparation for investment. ■■ In November 2012, Land Securities invested £15 million ■■ In partnership with BT, on the extension of The Sunderland will become the Bridges Shopping Centre and first city in Britain to offer opened its new 60,000 sq ft wall-to-wall superfast Primark store. broadband coverage. ■■ In December 2012, Nissan ■■ St Modwen and Persimmon announced plans to invest a Homes have submitted plans further £250m at its facility in to the council for the £10m Sunderland, creating around redevelopment of the 17 acre 3,000 jobs at its plant and in former Pyrex site, located off the supply chain. Pallion New Road, to build 212 family homes.s ■■ 82 bed Travelodge hotel opened November 2012 in Other substantial investments in Sunniside East. the city include: ■■ 125 bed Premier Inn hotel ♦♦ £82.5m for the New Wear neighbouring Sunderland Crossing from the Department University, expected to open for Transport. in Q3 2014. ♦♦ £8m from Gateshead College ■■ A new Hilton hotel for a Skills Academy for neighbouring the Stadium Sustainable Manufacturing of Light, Sunderland’s and Innovation. Premiership Football Club, is ♦♦ £6m for managed workspace expected to open in 2015. in Washington, jointly ■■ Planning permission was funded by the City Council granted in March 2012 for the and European Regional redevelopment of Joplings Development Funds. Department Store to provide At present, Sunderland is clearly a 119 bed hotel on the upper an attractive proposition for floors and retail and leisure on businesses, with more than 50 the ground floor. ‘live’ enquiries from prospective

investors considering the city as a place to do business. DESCRIPTION Developed in 2004, the property and 5 food and beverage units. Sunniside leisure scheme is the The 650 space multi-storey car park comprises a modern leisure The other building comprises a only cinema in Sunderland. The is held on a long leasehold by the scheme arranged as two adjacent casino and multi-storey car park scheme provides the only national local authority, providing all users buildings. One building retains (650 spaces). A3 operator concentration, whilst with free parking. a historic, listed façade which the remainder of the city provides The total GIA is 91,374 sq ft and the fronts High Street West and for more regional brands. site extends to 2.97 acres (1.2 ha). comprises a 12-screen cinema TENURE ACCOMODATION Long Leasehold. The property has been measured Area Area Unit Use on a Gross Internal Area (GIA) basis 999 year Long leasehold title (sq m) (sq ft) West Wear Street from the Council of the City of in accordance with the RICS Code 1 Ground Floor Cinema 3,956.5 42,587 Sunderland at a peppercorn rent of Measuring Practice (6th Edition) (Empire) (3,623*) (39,000*) and commencing 25th April 2003. as follows: 2 Basement / Ground / Casino 2,271 24,443 William Street Mezzanine (1,819*) (19,577*) (Grosvenor) 3 Ground Floor A3 380.9 4,100 (Frankie & Benny’s)

Bedford Street 1A Ground Floor A3 403 4,338

Cinemas 1C First Floor A3 850.5 9,154 (Dozo restuarant) 1B Ground Floor A3 270.4 2,911 (ASK) 2A Ground Floor A3 325.3 3,501 (Nandos) (306.6*) (3,300*) High Street West 2B Ground Floor A3 31.6 340 (Empire) 8,489.5 91,374 TOTAL (7,685*) (82,720*)

* Assumed areas in leases TENANCY

Lease Expiry Next Rent Area Rent Passing Rent Unit Tenant Lease Start Comments (TOB) Review (sq ft) (per annum) (£/sq ft) 1 Sunderland Cinema 2 Limited 03/09/04 02/09/29 03/09/14 39,000 £535,283 £13.73 Min Fixed Uplift in September 2014 to £605,622 pa. (T/A Empire Cinemas) Floor area shown is assumed, actual floor area is Guarantors: Cine UK Limited and 42,587 sq ft. Cinema Holdings 2 Limited 2 Gala Casino 1 Limited 03/09/04 02/09/29 03/09/14 19,577 £173,891 £8.88 Currently being rebranded as Grosvenor Casino. (T/A Grosvenor Casinos) Guarantor: Rank Group Gaming Division Limited 3 The Restaurant Group (UK) Limited 03/09/04 02/09/29 03/09/14 4,100 £65,875 £16.07 (T/A Frankie & Benny’s) (02/09/19) 1A & Kandaya Limited 24/08/11 23/08/31 24/08/16 13,492 £94,500 £7.00 Fixed uplifts at 5th & 10th review to 3% pa 1C (T/A Dozo Buffet Restaurant) (24/08/21) compounded. £60,000 rent deposit is held. (24/08/26) 1B Ask Restaurants Limited 03/09/04 02/09/29 13/01/15 2,911 £54,325 £18.66 Not in occupation. Ongoing negotiations with alternative occupier. 2A Nando’s Chickenland Limited 03/09/04 02/09/29 03/09/14 3,300 £57,750 £17.50 Floor area shown is assumed, actual floor area is (T/A Nando’s) 3,501 sq ft. 2B Sunderland Cinema 2 Limited 27/06/05 26/09/20 27/06/15 340 £7,000 £20.59 To be used as additional sales of merchandise. (T/A Empire Cinemas) Guarantor: Cinema Holdings 2 Limited Car City Council of Sunderland 03/09/04 990 years – Peppercorn rent. Park remaining

TOTAL 82,720 £988,624 COVENANT ANALYSIS CINE-UK LTD (GUARANTOR) (EMPIRE CINEMAS) Sunderland Cinema 2 Ltd is an SPV. Empire Cinemas Ltd was formed in 2005 and operates 162 screens across 16 cinemas in the UK. The lease in Sunderland is guaranteed by Cine–UK under an AGA. Cineworld is the second largest operator in the UK with 80 cinemas providing 818 screens. The group has the highest number of admissions, totalling 27.3%, of all UK admissions. The immediate parent company to Cine–UK is Cineworld Holdings Ltd and the global parent company is Cineworld Group Plc. Cine-UK Ltd (Company No. 3005901) has a Dun & Bradstreet rating of 4A1 showing a Minimum risk of failure. NANDO’S CHICKENLAND LTD (NANDO’S) Nando’s Chickenland Ltd is a leading restaurant chain and has 282 restaurants across the UK. Their immediate parent company is Nando’s Finance Ltd and the group’s global parent company is Nando’s Group Holdings Ltd. RANK GROUP GAMING DIVISON LTD Nando’s Chickenland Ltd (Company No. 2580031) has a Dun & Bradstreet rating of 4A1 (GUARANTOR) showing a Minimum risk of failure. (GROSVENOR CASINOS) Grosvenor Casinos is Great Britain’s leading casino entertainment brand. THE RESTAURANT GROUP (UK) LTD In 2012, Grosvenor Casinos recorded another period of revenue and (FRANKIE & BENNY’S) operating profit growth (up 4.2% and 10.9% respectively). The Group’s Frankie & Benny’s is a well established and leading Italian – American restaurant brand with 37 casinos contribute 52% of Rank Group operating profit before 200 outlets nationwide. Their immediate parent company is TRG (Holdings) Ltd and the exceptional items and central costs. group’s global parent company is The Restaurant Group Plc which operates 400 restaurants Rank Group recently completed on the acquisition of 19 casinos operated and pubs. by Gala Casinos from Gala Coral Group Ltd for circa £179million. All casinos The Restaurant Group (UK) Ltd (Company No. 894426) has a Dun & Bradstreet rating of 5A1 will be shortly rebranded as Grosvenor Casinos. The tenant will be Gala representing a Minimum risk of business failure. Casino 1 Ltd with Rank Group Gaming Divison Ltd as guarantor. Rank Group Gaming Divison Ltd (Company No. 3213743) has a Dun & ASK RESTAURANTS LTD Bradstreet rating of 5A1 representing a Minimum risk of business failure. ASK Restaurants Ltd operates 117 restaurants. It forms part of the Gondola Group of companies, the market leader in the UK casual dining sector. KANDAYA LTD (DOZO BUFFET RESTAURANT) ASK Restaurants Ltd (Company No. 2792998) has a Dun & Bradstreet rating of 5A1 Kandaya Ltd (Company No. 7506418) has a Dun & Bradstreet rating of N2 representing a Minimum risk of business failure. representing a lower than average risk of business failure. A £60,000 rent deposit is held. D&B Reports can be provided upon request. ASSET MANAGEMENT ■■ Opportunity to complete a surrender and new letting on the ASK restaurant unit. ■■ Create a stronger leisure centre identity and profile, with improved branding and signage. ■■ Build upon the strong trading of the cinema which has improved average attendances to in excess of 550,000 per annum over the last 3 years. PLANNING Sunniside was redeveloped in 2003-2004 under planning permission (Ref 02/01683/ AME) which amends the earlier permission (Ref 00/00641/AME). Part of the property accommodating the restaurant and bars has retained an original and listed façade and sits within the central conservation area of Sunderland. The listed status means there is nil rates liability on any voids under current legislation. A copy of the original planning consent and the conditions contained therein is available on request. WE ARE SEEKING OFFERS IN EXCESS OF ENVIRONMENTAL £12,900,000 (TWELVE MILLION NINE In 2010, Delta-Simons’ carried out a Phase 1 Environmental Inspection which concluded HUNDRED THOUSAND POUNDS) WHICH that the site was at low risk of environmental hazard or identifiable contamination. PRODUCES THE FOLLOWING YIELD PROFILE: A copy of the survey and EPCs are available on request. NIY: 7.25% VAT RUNNING YIELD SEPTEMBER 2014: 7.75% We understand this property has been elected for VAT which will therefore be RUNNING YIELD AUGUST 2016: 7.87% chargeable on the sale price unless the transaction can be treated as a Transfer of Going Concern (TOGC). CONTACT For further information please contact:

Edward George Mark Girling 5 Bolton Street, London WIJ 8BA D: 020 7312 7489 D: 020 7312 7460 www.montagu-evans.co.uk E: [email protected] E: [email protected] Freddie James Nick Richardson D: 020 7866 8613 D: 020 7312 7420 E: [email protected] E: [email protected]

Misrepresentation Act 1967 and Property Misdescriptions Act Montagu Evans LLP for themselves and for the vendors or lessors of this property whose agents they are, give notice that: 1 The particulars are set out as a general 2. All descriptions, dimensions, references to 3. Montagu Evans LLP nor their employees 4. Unless otherwise stated, all prices and 5. All the plans and maps provided within the guideline only for the guidance of intending condition and necessary permissions of the has any authority to make or give any rents are quoted exclusive of VAT and particulars are for identification purposes purchasers or lessees and do not constitute use and occupation, and other details are representation or warranties whatsoever in intending purchasers or lessees must only. the whole or any part of an offer or contract. given in good faith without responsibility relation to the property. satisfy themselves independently as to the whatsoever and any intending purchasers applicable VAT position. or tenants should not rely on them as statements or representations of fact, but must satisfy themselves by inspection or Designed and produced by THE GROUP www.completelygroup.com October 2013 | Ref: 11473 otherwise as to the correctness of each of them.