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Home , Fargate, Orchard Square, Sheffield City Centre

Sheffield — 2-18

Prime City Centre Freehold Mixed-Use Investment Opportunity — 2-18 Fargate

Investment Summary

■ Sheffield is ’s 3rd largest metropolitan city with a primary catchment of 641,000.

■ Sheffield is one of the most prosperous cities in the North of England and boasts an economy worth in excess of £7.5bn.

■ The subject property is situated on Fargate, Sheffield’s premier pedestrianised retailing thoroughfare.

■ The property comprises an attractive block of eight retail units at ground floor with four floors of separately accessed office accommodation above.

■ The property is held Freehold.

■ Total current income of £1,303,300 pa.

■ Retailers in the immediate vicinity include Topshop, Boots, Caffè Nero, Next and Marks & Spencer.

■ The office uppers of 26,776 sq ft (2,488 sq m) provide a rare city centre opportunity to enhance value through alternative use conversion (STPP) or refurbishment.

■ There are a number of asset management initiatives available to the freeholder to enhance rental growth going forwards.

■ We are instructed to seek offers in excess of£17,000,000 (Seventeen Million Pounds) reflecting 7.47% NIY on the contracted retail income, assuming a capital value of £500,000 for the upper parts. Location Economy & Demographic Profile Retailing in Sheffield

Sheffield is South ’s principal administrative and commercial centre Retailing in extends to approximately 1.78 million sq ft and borders Derbyshire, the Peak District and the Pennines. The city is and stretches along a linear pitch from in the north east to located approximately 33 miles south of , 38 miles east of Manchester, The Moor in the south west. At the centre of this pitch is Fargate, the 100% 40 miles north of Derby and 175 miles north of . prime pitch, where retailers include Marks & Spencer, Topshop, H&M, River Island, WH Smith, New Look and Next. In addition, John Lewis are located Road communications to and from Sheffield are excellent with the M1 to the southern end of Fargate, adjacent to one of the city centre’s busiest arterial motorway route skirting the northern and eastern fringes of the city. multi-storey car parks. The M1 in turn links directly to the M62 and M18 motorways providing quick access to the north east and north west of England. The city centre has only one shopping centre, the small , which is anchored by TK Maxx and Waterstones. A new shopping centre Sheffield benefits from modern transport infrastructure including a light has long been proposed and the council is currently seeking a development railway service, the Supertram, with three main routes travelling within the partner to deliverM6 the scheme, which is likely to be anchored by a new John city centre and connecting to the outer suburbs of Middlewood, Herdings Lewis store at Sevenstone.

Park and . A1(M) Morecambe Sheffield is well connected to London by train, with regular services to London Harrogate Kings Cross, the fastest journey time being approximately two hours. Sheffield York M6 Airport is located approximately 12 miles to the north east of the Leeds / Bradford Blackpool A1(M) M55 city, while to the north, Leeds Bradford International Airport is located within Bradford Leeds Blackpool M62 a one hour drive time, as is Manchester International Airport to the west. Preston Blackburn Halifax M65

M6 M61 M62 Huddersfield Bolton M66 Scunthorpe M180 M181 Humberside Sheffield is England’s third largest metropolitan authority and benefits from M58 M18 M60 Doncaster a primary catchment of 641,000 persons (Promis). The city has grown St Helens M62 Manchester She ieldM1 A1(M) from its industrial roots to encompass a wider economic base and build an M60 Stockport Liverpool economy worth in excess of £7.5 billion. Due to its industrial heritage, the Liverpool Manchester M53 M6 city has undergone significant population growth over the past century and M56 M1 Macclesfield Lincoln this is showing no sign of abating, with the population projected to increase Chesterfield Chester significantly by 2020 (welcometosheffield.co.uk). Mansfield

Newcastle- Stoke- M1 Sheffield boasts a population of over 2.1 million people within a one hour under-Lyme on-Trent peak travel time. This catchment population is significantly boosted Nottingham by approximately 61,000 students at Sheffield’s two universities and as Derby M6 East Midlands a consequence, the city’s catchment population also benefits from a Stafford Burton upon Trent particularly high proportion of young adults. Shrewsbury

M1 Telford M54 Tamworth Leicester International and domestic employers within the city including HBOS, M42 M6 Peterborough Wolverhampton Nationwide, Aviva, HSBC, Santander, BskyB, Eon and Plus Net. The public M69 West Bromwich Nuneaton sector is also a leading employer with Sheffield City Council, the Department Birmingham M1 Birmingham for Children, School & Families and Department for Work & Pensions M6 A1(M) Coventry Rugby represented (Source: PROMIS). M42 M45 M5 Royal Leamington Spa Northampton Worcester T W M U L A 2 P T S P C G W 7 K 2 A G R S 3 R 2 Y D & A S W A AM 21 TR D - 19 E H IG 15 Y) H 1 - NL 1 S O ES CC & A ES US 4 (B B

5 6T A 3S I M N 9 H Situation - P 1 O K S E 4 O 3 R N - H E 30 A P 4 B 2 M L A I E F A 8 F IL X 2 N N 2 M - A TRAM 2 S 6 K T - M D P 2 X 0 I R 2 E E F C V L A E M ( A D 1 N 2 L A S O O N 7 C R T P N 8 N E 1 H E F A IN - M T G 4 A O L The subject property occupies a prime retailing location on the 1 R V I O D CHURCH STREET E L D `S ( C F TRAM 2 O L R R R O E pedestrianised pitch of Fargate, opposite the main entrance to E D O S I E T N R T A G A N NLY) IL S S U CESS O ) T Marks & Spencer. National multiple retailers in close proximity USES & AC F R R (B LO A O N 1 R T 2 S include Next, River Island, Topshop, Boots and WH Smith. ) E TOR L 5 E OFFICE S AL N CUTLERS H 6 19 T - R 4 A The property is situated at the busy junction of the High Street

N

C FICE

E F 2 O and Fargate opposite the Cathedral tram stop and benefits from its (2 R ET proximity to the A2 banking pitch with tenants including Lloyds, C AI 2 AF L FE FL 4 ) NE OO Santander, RBS and Halifax. M CO RO R A FF S 0 EE ) .0 SH 0 O 6 1 P - 9 V The strength of the subject property’s situation is highlighted on the M IRG C P T IN 8 0 E M LE E V O .0 PH DIA GOAD plan opposite. 6 ON A N C ES C S H T A STA A F S N P N IF N E E OR 2 1 L E T S E H T 1 C W S L 1 B S PAPERCHASE A A L - C KE I Y R L R K V H A R S 0 I C 15 A A E A 1 T - S N E Y T Y 17 R H U K A P P T N T N A M L H 3 W A X E 1 T 9 N A T A E 1 C E B T C C R Description N 1 2 E 8 1 A E T R X R U T N S V E N A 2 2 N T E E N ` S 0 3 A C H N A O S 5 E 2 I H E E 5 N H L S S S A C 1 S 2 E 4 Z P C A R E 2 A N M I - T E A 1 U I S 2 / A E C 4 2 F V J L A R 7 E I E E 29 T W C T R L O EL C 3 The property comprises a multi-let parade of eight modern well configured N L A N 1 T E C S 3 R C T S A 3 L S N P T 6 A E E C RF 1 E E F EC 3 L IT T R D A TA 0 retail units with four floors of separately accessed offices above. The retail C M ILO E V EN RS T C S E P W N ( EA 3 8 A R 2 A 1 C C - VA units are typically arranged over ground floor and basement although two C L WS 3 A IN RE 4 R T ND FE D O A CA 3 S N H 6 of the units benefit from first floor sales accommodation. Each retail unit has & ITC 3 1 ST 5 G 4 SS I 3 RE - F 2 XP LT P T - E O A 3 S - CL 9 L rear servicing, accessed via the service yard from Church Street. 9 A 0 1 2 H E 4 A G 2 LT U S H R AN & 6 RD Y IT The four upper floors comprise office accommodation which is accessed B L 2 E T R T E U P U 4 A H A S U A 4 M Y O U H S E L SA IT R T B U AR separately via a self-contained entrance off Church Street and includes C N Y & O 4 H O T 8 S S 5 C P N O H N T O F N 2 LT A UI SH & S (3 A IC C 4 T B RE E R IS 6 R disabled access facilities. IS TAI H E B A 0 L FL AM & T U T 3 OO Y AN HO IS RS ER C 4 T O E ) N A 8 O 3 IO V L 4 T T I 7 T T 3 T A 2 EC S S T 3 F S D N IV O 5 A O L O 0 C G D T G L AN 5 O C 5 6 3 H A 2 3 SE V - R U W O HA S Tenure & Tenancy 4 A H S E 3 7 T N O 3 HO R H (3 M EA S 6 R F T AS 0 E RAV COO 3 E K F TA L AG O IL 4 EN E IP - V T C H Tenure: Freehold. FL ISIO LA S O 0 1 N P R O 4 EX O 4 O P L R - PT RES W S ICIA S A ) 8 N R ( 3 2 D R 7 E 4 E The retail accommodation is fully let on effectively full repairing E R Tenancy: H T - T A T I 5 N L A F 4 ) E and insuring terms to a range of national multiple retailers. L C O 8 (3 Y C O R S R 4 ET ` Y T R - A IL E A T E S FL I I L ) 2 OO R E 4 R R N S) O P A U H O P O M M The office accommodation is currently vacant and provides a number of P 2 M E N M R E T E F S S T O U 8 ( P R C T interesting asset management opportunities (STPP). H M 4 LA I N C T L E E V E O T E 3 9 F E H S S WO E H S T T R R & EL OR 1 SH B O U EP E 1 IP E IS E P O HO L A H NE 8 S T R A L The total current income is £1,303,300 per annum and a full list of the W N N 8A E E K N T D P E U 1 O M N 0 A R O R R S E O N 1 F tenancies and floor areas can be found in the tenancy schedule overleaf. H R A ( O 2 3 S N O C R G S O E Y 1 L K T A L O O 4 K 4 A & E IL Y E L T 6 A 1 R F F L - L T V E 6 O N S A S O 8 I O A C 5 R S Y W R O U I 1 S R R 8 S C B I O ) U A S G F L Y A S I A 2 N F Y 0 F H T H H I A L S O L M C U I G B K N R R B A O A C N N R (P N W A E O K P E A U 2 D E O E 2 E V R S O J O B L S T W Y R E I T R A A T N K T T L E A I S N A O F N F R B N H O N O D 2 LY I E A 4 O A E W ) A W - T R 2 D C 6 L M R E W T SP O B O C A H T TH K S T E RT E CO S R B VE G UIL NTR OO DIN Y D G S S OC IET Y Y Y OR R Tenancy Schedule

Address Tenant Name Lease Start Lease Expiry Next RR Current Rent Floor Areas Comments

ITZA 971.5 units - Tenant served S26 requesting a new lease. 2 Fargate HSBC Bank Plc 29/09/1987 25/12/2012 - £242,500 Basement Sales 1,258 sq ft 116.87 sq m Negotiations ongoing. Basement Ancillary 620 sq ft 57.60 sq m

Reversionary lease to Starbucks franchise (Soul Starbucks Coffee Coffee House (Central) Limited) t/a Starbucks, ITZA 761 units - 4 Fargate Company (UK) 25/01/2006 24/01/2016 - £175,000 agreed upon current lease expiry. Draft HOT’s Basement Ancillary 1,324 sq ft 123.00 sq m Limited available upon request.

ITZA 605 units - 6 Fargate Greggs Plc 29/06/2005 28/06/2020 29/06/2015 £126,000 - Basement Ancillary 814 sq ft 75.62 sq m

8 Fargate Vodafone Limited 25/12/2005 24/12/2015 - £88,600 ITZA 443 units - -

Basement Store Vacant - - - - Basement Ancillary 619 sq ft 57.51 sq m - (8 Fargate) The Carphone ITZA 554 units - 10 Fargate Warehouse 25/03/2015 24/03/2023 25/03/2019 £125,000 Basement Sales Basement 548 sq ft 50.91 sq m - Limited Ancillary 384 sq ft 35.67 sq m The Carphone ITZA 596 units - 12 Fargate Warehouse 25/03/2015 24/03/2023 25/03/2019 £125,000 - Basement Ancillary 717 sq ft 66.61 sq m Limited ITZA 575.5 units - Office Holdings Reversionary lease at £147,500 pa 14 Fargate 09/03/2006 08/03/2021 - £147,500 First Floor Sales 1,096 sq ft 101.82 sq m Limited signed from 09/03/16. Basement Ancillary 902 sq ft 83.80 sq m

Green + Benz Lease guaranteed by T.H. Baker Group Limited. ITZA 586.5 units - 16 Fargate Limited t/a 02/10/2014 01/10/2024 02/10/2019 £125,000 Guarantor’s liability capped at £75,000 Basement Ancillary 725 sq ft 67.35 sq m Pandora and expires 02/10/2019.

ITZA 493 units - First Floor Sales 1,026 sq ft 95.32 sq m 18 Fargate Vodafone Limited 13/11/2002 12/11/2017 - £148,700 Refurbishment programme underway. First Floor Ancillary 580 sq ft 53.88 sq m Basement Ancillary 743 sq ft 69.03 sq m

1st Floor 4,477 sq ft 415.92 sq m 2-18 Fargate - 2nd Floor 7,698 sq ft 715.16 sq m Vacant - - - - - Offices 3rd Floor 7,136 sq ft 662.95 sq m 4th Floor 7,465 sq ft 693.52 sq m

Total £1,303,300 Sheffield — 2-18 Fargate

Estimated Rental Value Asset Management Opportunities

Fargate historically reached £230 Zone A at its peak in 2008, and recent letting activity would suggest positive rental growth once again. Based on current The subject property provides a potential purchaser with the ability to own comparable transactions as detailed below, we believe the estimated rental value of the property reflects between £186 to £207.50 Zone A, graded upwards a prime, multi-let parade in one of the UK’s strongest cities. In addition, the from the junction of Fargate and Church Street. property has a number of deliverable asset management opportunities through which the freeholder can drive performance over the short and Recent Comparable Transactions medium term. We highlight a number of these initiatives below:

Renew lease to HSBC at 2 Fargate. The tenant served a Section 26 Address Tenant Transaction Date Headline Zone A Notice on 4th August 2014, requesting a new lease. We understand that 10 Fargate Carphone Warehouse Regear June 2015 £200.00 the subject property provides HSBC’s only cash bank in the city centre. 12 Fargate Carphone Warehouse Regear June 2015 £198.00 Regear lease on 18 Fargate with Vodafone and surrender 8 Fargate, 14 Fargate Office Regear May 2015 £207.50 providing an opportunity to relet the space and drive rental tone further. 16 Fargate Pandora OML December 2014 £200.00 Conclude reversionary lease to Soul Coffee House (Central) Limited 58-64 Fargate River Island OML August 2014 £186.00 t/a Starbucks. 33-35 Fargate Topshop OML June 2014 £205.00 Refurbish and let vacant offices accommodation, providing an immediate opportunity to increase the asset’s performance.

We believe the upper parts could also offer a range of alternative uses (STPP). These opportunities could include: residential, student and hotel conversion which would prove a significant development upside Covenant Status for the purchaser.

Tenant Experian Rating Date of Accounts Turnover Pre-tax Profit Net Worth

HSBC Bank Plc 90 – Low Risk 31/12/2014 - £1,953,000,000 £28,784,000,000

Starbucks Coffee Company (UK) 89 - Low Risk 10/02/2015 £408,721,070 £1,056,196 £35,513,083 Limited

Greggs Plc 100 - Very Low Risk 28/12/2014 £803,961,000 £49,743,000 £241,982,000

Vodafone Limited 100 - Very Low Risk 31/03/2014 - £251,536,000 £53,722,031,000

The Carphone Warehouse Limited 60 - Below Average Risk 29/03/2014 £37,866,000 £213,169,000 £1,120,748,000

Office Holdings Limited 100 – Very Low Risk 26/01/2014 £256,044,000 £28,106,000 £103,595,000

Green + Benz Limited t/a Pandora 91 – Very Low Risk 28/02/2014 - - £1,099,261 Service Charges

There is a service charge in operation at the property for maintenance and security of common parts/service yards and repairs. For the year 1st April 2015 to 31st March 2016 the budget is £73,220, equating to a low £1.54 per sq ft.

Further information available upon request.

EPCs

The Energy Performance Certificates and Recommendation Reports for the property are available upon request. Proposal

We are instructed to seek offers in excess of £17,000,000, subject to contract, for the freehold interest in this property.

Assuming a nominal capital value of £500,000 on the upper parts, this reflects an attractive 7.47% NIY, assuming purchaser’s costs of 5.80%.

Value Added Tax

The property is not currently elected for VAT, meaning that at present VAT is not payable on the purchase price.

Further Information

For further information please contact: Chris Lewis T: 020 7152 5991 E: [email protected]

Sam Waterworth T: 020 7152 5149 E: [email protected]

Cushman & LLP (and any joint agent appointed) on its own behalf and for vendors or lessors of this property, whose agent it is, gives 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: June 2015