Iceland Foods Limited

Prime Heritable Sale & Leaseback Investment Opportunity Iceland Foods Limited

9-11 Ferniehill Drive | Gilmerton | Edinburgh | EH17 7AR INVESTMENT SUMMARY

• Located in the densely populated south eastern suburb of Gilmerton with a resident population of 157,853 people within a 10 minute drive time

• Prominent situation fronting Drum Street (A772), an arterial route into Edinburgh

• Providing 18,651 sq.ft. split into two supermarket premises plus large surface car park

• New overriding FR+I lease to Iceland Foods Limited for a term of 10 years from completion

• Underpinned by way of a re-geared sublease to Lidl

• Total Passing Rent: £241,500 per annum

• Seeking offers in excess of £3,360,000

• Net Initial Yield 6.78% after allowing for purchaser’s costs at 6.01%

1 www.masonowen.com LOCATION

Gilmerton is a densely populated suburb of Edinburgh located some 5 miles south east of the city centre, 4 miles west of Dalkeith and within the City of Edinburgh Bypass (A720). The area is served by the A772 an arterial road which links to University of Edinburgh and the extensive amenities of Edinburgh city centre to the north and to the A720 to the south.

Gilmerton has good public transport connections with regular bus services providing direct access to Morningside, Leith, Newington and Corstorphine as well as the city centre.

Gilmerton has a catchment population of 31,906 within a 5 minute drive time and 157,853 people within a 10 minute drive time. The catchment population is expected to increase in the coming years following the City of Edinburgh Council’s decision to adopt the Local Development Plan (LDP). The LDP is reported to include allocations of land for circa 6,000 homes in South East Edinburgh and prominent sites in close proximity to Gilmerton include Broomhills, Frogston Road East (630 Units) and land off Gilmerton Station Road (650 Units).

2 www.masonowen.com

The premises form part of Gilmerton’s principal retail offer and occupy a prominent site at the junction of Drum Street (A772) and Ferniehill Drive (B701). National occupiers close by include Morrisons, Aldi, RBS, Ladbrokes, Domino’s and Lloyds Pharmacy. Local amenities can be found along Drum Street and Newtoft Street including a post office, public library, community centre and GP surgery.

DESCRIPTION

The property is of steel frame construction with block infill and sandstone cladding to the main elevations, under a pitched roof and slate covered mansard style element to three elevations.

Internally, the property provides two self-contained supermarkets with pedestrian access afforded off Drum Street and vehicular access onto a 103 space car park off Ferniehill Drive.

The premises sit on a site of approximately 1.58 acres.

3 www.masonowen.com 4 www.masonowen.com ACCOMMODATION COVENANT INFORMATION

sq m sq ft Iceland Foods Ltd

Ground 1,681.36 18,096 Iceland Foods Ltd was established in 1970 in Oswestry, Shropshire

First 51.39 553 and is now the UK’s leading frozen food retailer employing some 22,000 people and with over 880 shops trading UK wide. TOTAL 1,732.75 18,651 Iceland Foods Ltd recently announced company results for the year ending March 2017 with good growth across all its business segments. Sales and profits were up against the previous year and TENANCY the business reported strong cash generation despite increased The property will be let to Iceland Foods Ltd for a term of 10 years capital expenditure. Iceland continues to open new stores as from completion at an initial rent of £241,500 per annum exclusive. well as investing in a large store refit programme.

The lease will be drawn on Full Repairing and Insuring terms and the Iceland Foods Ltd is rated 5A1 by Dun & Bradstreet and the rent is to be reviewed on the fifth anniversary of the term to open company has reported the following results across the last market value. 3 years: N.B. Part of the property is sublet to Lidl UK GmbH and further details are available on request. March 2017 March 2016 March 2015

Turnover £2,770,000,000 £2,658,332,000 £2,682,021,000

VAT EBITDA £157,700,000 £151,590,000 £154,301,000

Net Assets £805,000,000 £753,128,000 £709,615,000 We understand the property is elected for VAT and providing certain criteria are met, the transaction may be treated as a Transfer of a Going Concern.

5 www.masonowen.com TENURE

Heritable interest (Scottish Equivalent of Freehold).

ENERGY PERFORMANCE CERTIFICATES

The Energy Performance Asset Rating Bands are as follows:

9 Ferniehill Drive - E73

11 Ferniehill Drive - E68

A full copy of the EPC is available at www.epcregister.com

PRICE

We are instructed to seek offers in excess of £3,360,000. A purchase at this price reflects a Net Initial Yield of 6.78% after allowing for purchaser’s costs at 6.01%.

6 www.masonowen.com MASON OWEN Gladstone House 11 Union Court Liverpool L2 4UQ DISCLAIMER: t. 0151 242 3000 Mason Owen & Partners for themselves and for the vendors or lessors of this property whose w. www.masonowen.com agents they are give notice that: (i) the particulars are set out as a general outline only for the guidance of intending purchasers or lessees, and do not constitute, nor constitute part of, an offer or contract; (ii) all descriptions, reference to condition and necessary permission for use FURTHER INFORMATION and occupation, and other details are given without responsibility and any intending purchasers For an appointment to view please do not hesitate to contact: or tenants 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 and are advised to do so; (iii) no person in the employment of Mason Owen & Partners has any authority to give ANDREW SCOTT t. 0151 242 3043 e. [email protected] representation or warranty whatever in relation to this property; (iv) all prices, rents and premiums SIMON BLAND t. 0151 242 3041 e. [email protected] quoted are exclusive of VAT at current rate.