CARLTON HOUSE , SO15 2DZ

FREEHOLD STUDENT DIRECT LET INVESTMENT OPPORTUNITY Investment Summary

n A rare opportunity to acquire a direct let prime student accommodation investment, located in a top Russell Group university city n Situated in a student favoured central location close to popular leisure destinations n Southampton has a high student to bed ratio, of 4.29 students per bed space, indicating a relatively undersupplied market n 73.3% of students are unable to secure accommodation provided by the universities and rely on private accommodation providers n 22.2% of the student population in Southampton are international students with a preference to live in high quality cluster flats n 66% of the current residents in Carlton House are international students n Carlton House comprises ‘New’ student accommodation finished to a high standard n Separate Bar unit let on a long lease to an established tenant n The property is fully let for 2014/15 and has been 100% occupied since opening in September 2013 n The forecast 2014/15 net income is £294,791 per annum n 85% of net income is derived from the student accommodation n Freehold

Seeking offers in excess of £4,125,000 (Four Million, One Hundred and Twenty Five Thousand Pounds) reflecting an attractive net initial yield of 7%, assuming purchasers’ costs of 2.80%. UoS Highfield Campus

UoS Avenue Campus The Avenue

Carlton House

Bedford Place St Mary’s Rd

SSU Campus

Town Hall

Mayflower

Above Bar Street

Southampton ASDA Central Station

West Quay John o' Groats Durness Skerray Port of Ness Thurso Balchrick Portskerra Wick Tongue Mybster Wick Stornoway Culkein Altnaharra Ulbster Unapool Kinbrace Stornoway Lybster Lochinver

Lairg Brora Ullapool Inveran Dornoch Kincardine Gairloch Braemore Junction Invergordon Lossiemouth Macduff Fraserburgh Cromarty Elgin Buckie Forres Banff Benbecula Achnasheen Nairn Keith Inverness Rothes Turriff Mintlaw Peterhead Inverness Grantown- Craigelliachie Huntly Kyle Drumnadrochit on-Spey Inverurie Ellon

Barra Invermoriston Dyce Aviemore Aberdeen Invergarry Kingussie Aberdeen Ardvasar Portlethen Mallaig Newtonmore Braemar Banchory Stonehaven Dalwhinnie Laurencekirk Fort William Johnshaven Pitlochry Brechin Glencoe Tobermory Montrose Tiree Aberfeldy Forfar Lunan Blairgowrie Arbroath Dundee Carnoustie

Oban Dundee Perth St Andrews Callander Cupar Glenrothes Dunblane Alloa Buckhaven Stirling Cowdenbeath Kirkcaldy Dunfermline Helensburgh Denny North Berwick Dunoon Stenhousemuir Dumbarton Kilsyth Edinburgh Dunbar Falkirk Glasgow Bo'ness Greenock Livingston Haddington Paisley Edinburgh Rothesay Motherwell Eyemouth Largs Islay Hamilton Peebles Biggar Irvine Kilmarnock Melrose Coldstream Brodick Muirkirk Troon Prestwick Kelso Belford Prestwick Machrihanish Cumnock Ayr New Cumnock Campbeltown Maybole Sanquhar Turnberry Moffat Girvan Thornhill Amble Morpeth Ballantrae Otterburn Newbiggin- Londonderry Kielder by-the-Sea Blyth New Lockerbie Galloway Woolsington Whitley Bay Dumfries Newcastle International Airport Kirkcolm Gretna Tynemouth Newton Haltwhistle Prudhoe Stewart Dalbeattie Annan Stranraer Newcastle-upon-Tyne Glenluce Kirkcudbright Brampton Sunderland Portpatrick Wetheral Allonby Wigton Port Logan Whithorn Durham Peterlee Drummore Maryport Bishop A1M Auckland Hartlepool Belfast Workington Keswick Penrith Whitehaven Durham Tees A66 Valley Airport St Bees Middlesbrough Whitby Darlington Seascale Richmond Windermere Ramsey Ravenglass Coniston A19 Scarborough Peel A170 Pickering Filey Douglas Ripon Ballasalla Lancaster A1 Castletown Harrogate Bridlington

York Hornsea Beverley Blackburn Bradford Leeds Kingston M65 upon Hull M621 A1(M) Preston M62 A565 Goole M6 Rochdale Humberside Bury M1 Huddersfield Scunthorpe M62 M58 Bolton Barnsley Grimsby Doncaster Caistor Manchester Liverpool Gainsborough M60 Market M6 Stockport Rasen Louth Mablethorpe Sheffield Retford Runcorn Sutton-on-Sea Wragby M56 Macclesfield Chesterfield Lincoln M6 A1 Horncastle Ingoldmells Caernarfon Chester Skegness Newark- on-Trent Wells next Location Situation Coningsby the Sea Ashbourne Sleaford Nefyn Porthmadog Nottingham Sheringham Grantham Boston Hunstanton Holt Cromer Criccieth Whitchurch Stone Derby Pwllheli Holbeach Fakenham Southampton is an established commercial centre on the south coast Carlton House is located at the geographical and commercial heart of Long N. Walsham Sutton Aylsham of England, located approximately 80 miles (128 km) south-west Southampton. It is situated on the corner ofMelyon Southampton StreetSpalding and Mowbray King's Lynn of London,Barmouth 20 miles (32 km) north-west of andShrewsbury 14 miles Carlton Place opposite the Cricketers Arms and a short distance from Hemsby East Wisbech E. Dereham Norwich Welshpool Bedford Place. Midlands Stamford Swaffham Great (22 km) south of . It is a modern and vibrant cityTelford with a Tamworth Yarmouth thriving population of approximately 1,014,000 within 10 miles of Norwich Walsall Leicester Wymondham the cityAberdovey centre, which includes over 35,000 students. WolverhamptonBedford Place comprisesNuneaton one of Southampton’s main leisure andPeterborough Downham Corby Oundle Market Lowestoft Church Birmingham Market Chatteris Attleborough Beccles Stretton Oldburyevening/late night locations, andHarborough is a popular destination for Brandon Kessingland Newtown Thetford Diss Kerry County Southampton benefits from excellent transport communications, studentsBirmingham and professionalsCoventry alike. In addition, there are a number of Bungay Aberystwyth Kettering Southwold Waterford being situated at the southern end of the M3 motorway (JunctionLudlow convenience stores and otherRugby amenities within walking distance on Llandrindod Kidderminster Huntingdon Ely Halesworth 14), which provides direct access to London and the London Road. Coventry Mildenhall Wells Leominster Warwick Northampton Leiston (Junction 12) to the north-east. The intersects theBromyard Daventry St Neots Aberaeron Newmarket Bury St Stowmarket M3 to north of the city and provides access to Portsmouth to the WorcesterThe University of Southampton’s main Highfield campus is Edmunds Tregaron Bedford Cambridge Aldeburgh east (18 miles) and BournemouthLlanelwedd to the Hay-west (33 miles). Access to approximately 1.9 miles to the north and Southampton Solent Cambridge Haverhill Lampeter on-Wye Great Woodbridge Malvern Milton Ipswich Cardiganthe city centre from the M27 motorway is provided via University’s main campus is approximately 0.6 milesKeynes to the south of Sudbury Llandovery Cork the M271 motorway (Junction 3) and the A33. Hereford the subject property. A University bus stop is located within walking Fishguard Ledbury Felixstowe Brecon distance of the property on London Road, with both the U1 and U2 Colchester Gloucester Braintree Cheltenham Cheltenham Banbury Stevenage St.National Express coach services between Southampton city Uni-link buses providing a direct connection to the Highfield Campus. Stansted A12 Walton on the Naze Haverfordwest Clears Luton centreCarmarthen and London Victoria bus station are popular with students, Tiptree Frinton-on-Sea Merthyr Monmouth Gloucester Clacton-on-Sea Milford operating an hourly return with fastest journey times of M40 Haven Llanelli Tenby approximately 2 hours. Oxford Neath Chelmsford Pembroke Cwmbran Stroud M25 Swansea M25 D M5 R Southampton CentralPort railwayPontypridd station provides regular M4train services SwanseaTalbot A46 OW

Bridgend M4 B L Newport London D S

to London Waterloo, with a fastest journey time of approximately A34 E O

D

RSET TON PL ON F ARL Reading O C

1 hour 20 minutes.Porthcawl Local services operate to BournemouthCardiff and

M4 R Bristol S

Bristol D London-City MargateT RD Portsmouth Harbour in 37 minutes and 49 minutesPenarth respectively. P Llantwit Heathrow L N Broadstairs Barry A Newbury CE South West Trains, NetworkMajor Rail andCardiff Southampton City Council are DO M25 NKent Intnl. Ramsgate Weston A338 LO currently undertaking a circa £3 million refurbishmentSuper-Mare of the A3station.7 Bath M20 M2 Lynton Lynmouth M3 Sandwich Ilfracombe A34 Canterbury Maidstone Deal Minehead Guildford Southampton International Airport is located approximately 4.5 Basingstoke A S

Bridgwater BO T A36 Dover. Barnstaple M20 AN miles (7.5 km) to the north-east of the city centre, and provides V E FolkestoneD TunbridgeCOMMERCIAL RD B Winchester R A303 AR scheduled and charter flights to variousTaunton domestic and short-haul Wells EW S S Southampton R Clovelly internationalBideford destinations. During 2013 it handled approximately T D South SOUTHAMPTON A3 Solent Wellington Shaftesbury University 1.72 millionGreat passengers.Molton M27 Southampton Torrington Crewkerne A354 ESPLANA Holsworthy Brighton Central ERN DE Sherborne EST A27 W K Bude I Honiton Lyme N G Regis Portsmouth S Okehampton Crediton Dorchester Poole W A Exeter Sidmouth A31 Y Tintagel Exeter Launceston A Newton Exmouth 33 Padstow Abbot Teignmouth Wadebridge Tavistock Bodmin Newquay Plymouth Torquay

Newquay Looe Totnes Plymouth Paignton St. Austell Redruth Truro Kingsbridge Dartmouth St. Ives Salcombe Penzance Heliport Hayle St Mawes St Just Penzance Falmouth Helston Description & Specification

The property comprises a four storey concrete framed former office building (previously 21,000 sq ft NIA), with bar unit and single 6 bedroom and single 4 bedroom apartment at ground level with 15 further 4 bedroom apartments on the upper floors.

The building was comprehensively converted in 2013, including new cladding, roofs, internal fit out and lift.

Each apartment is finished to a high standard to provide luxury student accommodation. The apartments benefit from the following specification: n 4 (or 6) Double bedrooms with bed, desk and wardrobe n Open plan kitchen with oven, hob, fridge freezer, washer/dryer and dishwasher n Generous communal space with sofa, coffee table, dining table and chairs n 2 Bathrooms per apartment with bath/shower n Free WIFI with unlimited fibre broadband (80 Mbps) n Secure entrance with CCTV n Communal courtyard garden n Secure bike store

The building benefits from four parking spaces, one of which is let with the bar unit and the others being let on licence to a local firm. Accommodation Schedule Number of Total Number Room Type Apartments of Beds Apartments – 4 beds 16 64

Apartment – 6 beds 1 6

Total 17 70

The ground floor bar unit has a net area of approximately 1,085 sq ft. Tenure

Freehold Tenancies The student accommodation is 100% let and has been since opening in September 2013.

Accommodation Tenant Rent Per Term Start Date End Date Comment Annum

Student Flats Multiple £334,405 12 month ASTs - - Further information can be provided on request

Mr C D Seymour Ground Floor Premises £23,000 25 years 29 September 2008 28 September 2033 5 yearly rent reviews and Mrs T L Seymour

Car Parking Spaces (3) Local Firm £1800 Monthly - - Rolling monthly licences at £50 each per month

Total Gross Income £359,205 pa. Net Income Planning The net forecast property income for 2014/15 is £294,791pa. Carlton house was granted change of use from offices to student residential accommodation (16 flats comprising 64 bedspaces) Deductions include letting agent fees, property management fees, in April 2012 (Ref. No: 12/00520/FUL). common parts electricity and internet/telephone and insurance. A schedule of historic and forecast costs can be provided upon request. In January 2014 part of the ground floor was granted change of use from an existing public house to student residential accommodation (1 flat comprising 6 bed spaces), with associated Management external alterations (Ref. No: 14/00001/FUL). The student accommodation is currently managed by St Moores, who act as letting and managing agents via their subsidiary Park Lane Block Management Limited. St Moores is a long established Southampton specialist letting and property management business based within a few minutes’ walk of Carlton House. St Moores provides an efficient and cost effective service. Details of their letting and management agreements can be provided upon request. Rental Overview University of Southampton/ Southampton Rents Contract Scheme Solent University Ensuite Per Week Inclusive of bills Length (Weeks) Total Cost Carlton House provides 4ft beds and one bathroom per 2 bedrooms whereas a significant proportion of non-ensuite University owned City Gateway/Mayflower UoS Yes £136.29 Yes (Utility) 39/40 £5,383 accommodation is single bed, substantially less attractive to students.

At Carlton House, each cluster flat has an individual electricity, gas and Wessex Lane UoS Yes £124.46 Yes (Utility) 39/40 £4,916 water accounts and students are billed directly for electricity and gas but by the landlord for water usage (which is sub-metered). Highfield Halls UoS No £141.61 Yes (Utility) 39/40 £5,594

We estimate the utility costs to be approximately £6 per bedroom per week. Students at Carlton House benefit from free unlimited Lucia Foster Welch SSU No £89.95 Yes (Utility) 48 £4,318 broadband. The rent for Carlton House for 52 weeks relative to competing accommodation illustrates that Carlton House is very well priced in the market, borne out by 100% occupancy since opening. Emily Davies (Extra large room) SSU No £114.73 Yes (Utility) 41 £4,704

Carlton House’s current rent averages £95 per week (excluding utilities Deanery SSU Yes £124.88 Yes (Utility) 41 £5,120 but including broadband) Carlton House - No £95 No (Free internet) 52 £4,940 A selection of comparable Southampton student accommodation rents is outlined adjacent: Higher Education in Southampton

Southampton is host to two major higher education institutions; the University of Southampton and Southampton Solent University. Additionally City College Southampton is based in the centre of the city, on St Mary Street.

University of Southampton n Senior Russell Group University n The University’s main campus is located in the residential area of Highfield, two miles to the north of the city centre n Overall ranking of 18th in the Times Good University Guide 2015, up two from the 2014 ranking n The old Boldrewood campus is currently undergoing a £300 million development into the Maritime Centre of Excellence. n For every place there are 6.7 applications n The University has recently built a £55 million building for the school of Electronics n 86.3% of the students come from state sector schools and 22.4% and Computer science, adding to its excellent engineering facilities reputation. from working class homes n The Jubilee Sports Centre, opened in 2004 at a cost of £8.5 million is located on n Overall student satisfaction is rated at 82.2%. the Highfield Campus. Included are a six-lane, 25-metre swimming pool, full gym with 160 fitness stations and an 8 court sports hall n Rated as a top 100 university in the world according to the Times Higher Education Table and 86th overall in the world by the QS World University Rankings n The University completed a £4.3 million re-development of its 76-acre outdoor facilities located at Wide Lane, Eastleigh in 2007 n Five campuses in Southampton and Winchester n In the final stages of a £250 million facilities upgrade n Opened a campus in Malaysia dedicated to mechanical engineering in 2012 Higher Education in Southampton (Cont.)

Southampton Solent University n The largest of the nine universities created in 2005, Solent concentrates on vocational courses, with strong representation of ‘non-traditional’ disciplines. n Overall ranking of 115th in the Times Good University Guide 2015 and 107th in the Guardian University Guide 2015 n For every place there are 3.9 applications n 97.1% of the students come from state sector schools and 36.5% from working class homes. n Overall student satisfaction is rated at 77.2%. n The main campus is located on East Park Terrace, situated within walking distance of the city centre and Carlton House. n The university has spent more than £25m on improvements since 2008 and is planning to invest another £45m over the next 20 years. n New teaching and learning facilities will open in 2015 on land adjoining the main campus. n Other recent developments include a £2.7m ship handling centre, a new city centre site for the Southampton School of Art and Design, and new football facilities that are used by the city’s Premier League team.

University Bed Spaces as Total full-time Applications Full-time Full-time International Accommodation a % of Student Southampton HE Students per place Undergraduates Postgraduates Students (Bed Spaces) Accommodation

University of Southampton 23,115* 6.7 16,055 7,060 6,230 5,640 24.40%

Southampton Solent University 12,495 3.9 11,515 575 1,665 2,294 18.36%

Total 35,610 - 27,570 7,635 7,895 (22.2%) 7,934 22.28%

Student : Bed Space 4.49 - - - -

* Source: HESA 12/13 VAT

The property has been elected for VAT. EPC EPCs are available upon request. The apartments have an EPC rating of B 80-84. Proposal We are instructed to seek offers in excess of £4,125,000 (Four Million, One Hundred and Twenty Five Thousand Pounds) reflecting an attractive net initial yield of 7%, assuming purchasers’ costs of 2.80%. We believe Multiple Dwelling Relief will apply to the sale/purchase and that SDLT will be 1% rather than 4%.

Contact For further information, please contact:

Richard Talbot-Williams [email protected] T: 020 7338 4244 M: 07795 114 684

Oliver D’souza E: [email protected] T: 020 7338 4865 M: 07717 274 648 BNP Paribas Real Estate David Edwards 5 Aldermanbury Square London EC2V 7BP [email protected] T: 020 7484 8127 M: 07921 234 025 www.realestate.bnpparibas.co.uk

Misrepresentation Act 1967: BNP Paribas Real Estate Advisory & Property Management UK Limited for themselves and for the vendor(s) or lessor(s) of this property whose agents they are, give notice that: 1. These particulars do not constitute, nor constitute any part of, an offer or contract. 2. None of the statements contained in these particulars as to the property are to be relied on as statements or representations of fact. 3. Any intending purchaser or lessee must satisfy himself by inspection or otherwise as to the correctness of each of the statements contained in these particulars. 4. The vendor(s) or lessor(s) do not make or give and neither BNP Paribas Real Estate Advisory & Property Management UK Limited nor any person in their employment has any authority to make or give, any representation or warranty whatever in relation to this property. Finance Act 2013: Unless otherwise stated all prices and rents are quote exclusive of VAT. The Business Protection from Misleading Marketing Regulations 2008: These details are believed to be correct at the time of compilation but may be subject to subsequent amendment. October 2014.

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