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Opportunity An exciting freehold “opportunity on a prominent corner site in benefiting from a consented residential scheme”

2 WALTER HOUSE COVENT GARDEN 1 Executive Summary

– Freehold mixed-use investment / development opportunity

– Prominently located on the corner of Strand and Bedford Street, a prime Covent Garden location moments away from the world famous Piazza

– Two adjoining buildings providing 19,377 sq ft (1800.1 sq m) of Gross Internal Area with existing B1 office use and 6,683 sq ft (620.7 sq m) of retail accommodation across five retail units

– Walter House was originally built in 1907 and benefits from extensive frontage to Strand

– 50 Bedford Street is a more modern building constructed in the late 1960s / early 1970s

– The upper floors of Walter House and 50 Bedford Street are offered with immediate vacant possession providing the opportunity for refurbishment and re-letting, owner occupation or residential conversion

– Detailed planning consent for the provision of 18 residential apartments (C3) comprising 14,961 sq ft (1,390 sq m) of Net Saleable Area with a mix of one, two and three bedroom apartments

– Retail element provides active asset management opportunities

– Covent Garden is one of the most vibrant commercial, retail and residential locations in Central

– Offers are sought in excess of £25,250,000 subject to contact and exclusive of VAT. Pricing at this level reflects a value of £723 per sq ft on the existing GIA of the offices assuming a net initial yield of 4.20% on the retail element once fully let at our assumed ERVs (assuming standard purchaser’s costs of 5.80%)

2 WALTER HOUSE COVENT GARDEN 3 River Embankment Somerset Charing Savoy Strand Leicester Covent Covent Royal Oxford Court Road Cross Hotel Circus Square Garden Garden Opera Circus ( from 2018) Piazza House

4 WALTER HOUSE COVENT GARDEN 5 The Location

“Covent Garden is a lively and dynamic village in the of London’s

Covent Garden is a vibrant and popular As a dining destination, the area is famous for commercial, retail and residential district in its diverse selection of food and leisure choices London’s West End. Bordered by to from casual cafés and trendy pop-ups to the west, to the north, high-end brassieres such as Balthazar and the City to the east and the to The Ivy. Boasting five-star hotels such as the south, Covent Garden is centrally located The Savoy and One , Covent Garden The with excellent transport connections and is a magnet for those who want to enjoy the accessibility across the capital. abundance of lifestyle and leisure offerings. Renowned for the former fruit and vegetable Covent Garden has long been associated The Northbank Bid Situation market in the central square, the evolution of with culture and entertainment. With over Covent Garden has established it as a London 40 , street performances throughout ‘The Northbank’ is an area recently approved for extensive renovation Walter House is prominently situated on the icon. Key estate holders, Capital and Counties the year and House, the area, by City Council. The area covers from north side of Strand on the corner of Strand Properties and have led the which is steeped in history, continues to draw in the west through to Aldwych in the east, inclusive of the Strand. and Bedford Street. Strand is the main east / transformation through extremely successful worldwide recognition as the place to live, west thoroughfare linking Trafalgar Square tenant engineering strategies and considered work and visit in the capital city. The aim of the project is to strengthen the reputation of Northbank with Aldwych and Kingsway. 50 Bedford Street planning and investment. as a leading cultural, historical and diverse environment and to further cement its position as: is located on the east side of Bedford Street Today, Covent Garden is home to a selection at the southern end. Bedford Street connects of internationally renowned brands including · A world class destination in London. · A home for leading business. Strand with the two key Covent Garden Streets, Chanel, Dior and Burberry and the tech giant · A prosperous and competitive · An area that excels at offering Henrietta Street and King Street which lead Apple also has their largest store in Europe working and residential community. high quality public space. on to the Piazza. within the Piazza. Other key retail hubs include Exchange Court, a pedestrian walk way Long Acre, Seven Dials, King Street and Strand. As part of the planned improvements; road, pedestrian, public and transport linking Strand with Maiden Lane, runs through connections are being updated. A particular proposal is to enhance the pedestrian Walter House at ground floor level between route between and Covent Garden along Adelaide Street. 418 Strand and 419-420 Strand.

6 WALTER HOUSE COVENT GARDEN 7 The Amenities

Attracting people from all over the world, the buzz of Covent Garden is fuelled by theatres, opera and restaurants which sit amongst a host of cutting edge retailers.

m 42Visitors per year

72mins Average dwell time

8 WALTER HOUSE COVENT GARDEN 9 25 28

N E W The N T R O T BO N EE L TR O S T S H T AN R K MN H E I RE “With the opening of N IG E H T G S Connections W A Y TOTTENHAM Crossrail at Crossrail due 2018 LINCOLN’S INN FIELDS T E 29 D E Court Road in 2018, the R R U T ET R S RE Y N ST L E NIA A E 26 RDI N U SA E E Q T U A N E status of this dynamic area R E G V E A N T D 27 Y E 14 E T E L E R L RE U R S ST T L B 12 T GA S R U

T S E OR

H will be further enhanced” E E DR P

T T T UR F U Y O L A AN H M E S N 28 O

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The properties benefit from excellent transport 13

M B E O links, including Covent Garden (), W R E 6 H C R S YC E C T T W 9 R COVENT A R E LD S E E A Charing Cross (, and T G E R R GARDEN N T T E O S L L E 8 L T J E National Rail) and (Northern 3 A S M S E U 8 S R S and Piccadilly lines) Underground stations, 10 T R 19 E 16 27 E 1 14 T all of which are within walking distance 5 11 W 22 15 E L L 10 T IN 24 E 12 2 G of Walter House and 50 Bedford Street. E 5 T 17 R 2 O 15 ST 23 L COVENT GARDEN N 30 A S R 21 T O PIAZZA 20 R FL 13 E 3 E 17 ET 4 T RE T T 16 24 T 25 E S E RE RN 7 E T U 18 TR S ND BO S K 11 A N G S OC R A IN O T ST CR K 9 U IS T V H TA 23 A LEICESTER M P SQUARE T O N L Covent Garden Charing Cross Leicester Square Tottenham Court Road Holborn A E S 26 T N N 18 R A E 20 C 4 mins 4 mins 7 mins 13 mins 14 mins L E A B 4 T

S E S ’ D 19 S 6 T N F A I O V E T

R O R

R D D Y

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C N Piccadilly line Bakerloo line Piccadilly line Central line Piccadilly line A

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N I Northern line Northern line Northern line Central line

D A R D

22 N A A A M 1

R Crossrail (2018) H T S T S T N

C WILLIAM IV STREET R E E M E K 21 T N A B M E CHARING CROSS A RI O 7 CT VI

Furthermore connections and journey From (Station) To (Station) Time (mins) times for the area will further improve Tottenham Court Road 2 Restaurants & Hotels Shopping across London when Crossrail opens in 2018. 7* / 11 1 American Bar 11 Joe Allen 21 Terroirs 1 Agnès B 11 Kurt Geiger 21 Rugby Ralph Lauren The high frequency and high capacity rail Charing Liverpool Street 8* / 17 2 Balthazar 12 Kopapa 22 Les Deux Salons 2 Apple 12 Links of London 22 Trevor Sorbie service will link Maidenhead and Cross 3 Christopher’s 13 L’Atelier de Joël 23 J Sheekey 3 Aspinal of London 13 23 Villebrequin in the West, to Shenfield and 14* / 17 Robuchon in the East and will be accessible via 4 Da Polpo 24 Clos Maggiore 4 Burberry Brit 14 Mulberry 24 Jack Wills 32* / 36 5 Dishoom 14 Mon Plaisir 25 The Rosewood Hotel 5 Chanel 15 Michael Kors 25 Oakley Tottenham Court Road, a short distance 6 The Delaunay 15 26 Belgo 6 Fred Perry 16 Nicole Farhi 26 Ellis Bingham away from the properties. Source: TfL.gov.uk, Crossrail.co.uk *Part journey via Crossrail (2018) 7 Gordon’s 16 Opera Tavern 27 The Waldorf Hotel 7 Hackett 17 Nigel Hall 27 LK Bennett 8 Hawksmoor 17 Radio Rooftop Bar 28 The Hotel 8 Hobbs 18 Oliver Sweeney 28 Aram Furniture Walter House and 50 Bedford Street is also 9 The Ivy 18 Rules 29 Hotel 9 Jo Malone 19 Paul Smith well served by regular bus services along 10 Jamie’s Italian 19 The Savoy Grill 30 Cucina Asellina 10 Kate Spade 20 Penhaligon’s Strand to both the West End and City. 20 Simpson’s

10 WALTER HOUSE COVENT GARDEN 11 The Property

“Attractive buildings providing prime retailing on Strand and B1 office space on the upper floors.”

Existing Offices

Walter House is an attractive corner building 50 Bedford Street is a more modern building and with the original construction dating back was constructed in the late 1960s / early 1970s. to 1907. The property provides 20,790 sq ft The self-contained building is arranged over (1,931.2 sq m) (inclusive of the retail) of Net lower ground, ground and three upper floors Internal Area arranged over lower ground, and provides 1,452 sq ft (134.7 sq m) of Net ground and five upper floors. Internal Area (inclusive of retail) in total.

The existing B1 office accommodation is arranged The property provides 658 sq ft (61.0 sq m) of over part lower ground, part ground and five existing B1 office accommodation arranged over upper floors, totalling 14,901 sq ft (1,384 sq m). three upper floors served by an internal staircase. The property is accessed from the main entrance on Bedford Street with a passenger lift serving all floors. All the floors benefit from excellent views down Strand and boast good natural light.

The office floors in both buildings are vacant and internally the specification includes; – A six passenger lift serving all floors – Category II lighting (Walter House only) – Male and female WCs – Plastered and painted ceilings and walls – Kitchen facilities – Wood effect and carpet flooring – Perimeter trunking

12 WALTER HOUSE COVENT GARDEN 13 The Property

Retail “Walter House and 50 Bedford Street provide five prime retail units”

421 / 422 Strand is the largest unit and occupies a prominent corner position at the junction of Strand and Bedford Street. The unit is let to Pret a Manger with the ground floor dedicated to retail use and ancillary basement accommodation accessed via a staircase situated to the rear of the ground floor.

419 / 421 Strand is let to The Restaurant Group (UK) Limited (t/a Garfunkel’s) and benefits from good frontage to Strand. The position and style of the staircase towards the front of the unit allows for the basement to be used as sales space.

418 Strand, 50 Bedford Street and 51 Bedford Street are small lock-up shops with basement ancillary accommodation.

14 WALTER HOUSE COVENT GARDEN 15 The properties have been professionally Schedule referenced in accordance with the RICS Code Stacking of Measuring Practice (6th addition) by Plowman of Areas Craven and provide the following areas: Plan

NIA (SQ M) NIA (SQ FT) GIA (SQ M) GIA (SQ FT) Roof Walter House Plant 9.7 104 5th Office 206.3 2,221 264.2 2,844 4th Office 266.9 2,873 320.7 3,452 3rd Office 279.5 3,009 325.9 3,508 Fifth Floor 2nd Office 273.8 2,947 318.4 3,427 1st Office 265.8 2,862 309.6 3,333 Ground Office 36.2 389 83.9 903 Basement 55.3 600 82.8 891 1,384.2 14,901 1,715.2 18,462 Fourth Floor

418 Strand Ground Retail 26.4 284 29.1 313 ITZA 244 Basement Storage 26.9 290 28.3 305 plus basement storage 290

Third Floor 420 Strand Ground Retail 71.4 769 78 840 ITZA 573 Retail & Basement Storage 113 1,216 137.8 1,483 plus basement storage 116

421 / 422 Strand Ground Retail 95.3 1,026 104.9 1,129 ITZA 827 Second Floor Basement Storage 129.2 1,391 14.8 1,602 plus basement storage 1,391

51 Bedford Street Ground Retail 26.0 280 30.8 332 ITZA 275 Basement Storage 58.8 633 71.6 771 plus basement storage 633 547 5,889 629.3 6,775 First Floor

50 Bedford Street 3rd Office 20.3 219 28.3 305

2nd Office 20.4 220 28.4 306 Ground Floor 1st Office 20.3 219 28.2 304 Ground Retail 20.4 220 28.6* 308* ITZA 220 plus basement Basement Storage 53.3 574 66.5 716 574 storage 134.7 1,452 180 1,939 Basement

*GIA is inclusive of access to the upper floor offices

16 WALTER HOUSE COVENT GARDEN COVENT GARDEN 17 Tenancies Tenant Covenant information

5 0 51 Pret A Manger The Restaurant BEDFORD STREET 1188 (Europe) Ltd Group (UK) Ltd 0 44 42 Garfunkel’s is a restaurant brand offering 19 Pret A Manger is a global café chain the best of British and international cuisine. 4 providing natural handmade foods. Principally located across , the 2 Further information is available at restaurant chain has traded for over 30 years. 42 www.pret.com Further information is available at 1 www.garfunkels.co.uk

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Limited S E 5 a 1 7 O E 5 19 4 3 D T 0 4 AN 51 7 421–422 Ground & Pret A Manger 1,026 1,391 20 29/09/99 28/09/19 29/09/14 £187,360 41 8 41 Strand Basement (Europe) Ltd 20 6 4 9

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The retail leases of 419-420 Strand (The Restaurant Group UK Ltd) and 421-422 Strand (Pret A Manger Europe Ltd) The section of land shaded purple is not included5 within the Vendor’s title at ground floor level. The passageway 9 l

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5 u E 0 rt House E TR 0 6 S 5 44 1 M A D The Opportunity

Residential Planning Consent

Planning consent was granted on 9th December 2014 for C3 residential conversion (Ref: 13/09609/CAC). Planning consent was granted on 9th December 2014 for the demolition and erection of 50 Bedford Street and a change of use across the upper parts of Walter House to provide 18 C3 Residential apartments over first to fifth floors. With an excellent residential unit mix of one, two and three bedroom apartments, the finished scheme will appeal to both investors and pied à terre buyers alike; we believe this will encourage the highest residential values once complete. Copies of the consent along with the consented architectural drawings, are available within the data room.

20 WALTER HOUSE COVENT GARDEN 21 The Opportunity

Office Refurbishment Opportunity Retail Opportunity

With their prime commercial location, The retail element offers secure diversified clean floor plates and excellent natural light income with significant growth potential in throughout, the properties are also suitable the short to medium term. Letting the two for comprehensive office refurbishment vacant units provides the opportunity to and re-letting, or owner occupation. increase the current income. Additionally the Reconfiguring the existing accommodation let retail units are considered reversionary could increase the net internal area and today and well-timed staggered lease events improve the layout of the properties to suit provide the opportunity to capitalise on strong modern occupier demands. Other proposed forecasted rental growth. works would include reception upgrades, full refurbishment of the office floor plates to Cat A as well as improved internal communal areas.

22 WALTER HOUSE COVENT GARDEN 23 Consented Scheme Schedule

The table below outlines the proposed off plan Net Saleable Areas (NSA) for the consented residential upper parts.

Floor Type Bedrooms Size sq m Size sq ft First Residential Flat 1.1 3 bed 94 1,012 Flat 1.2 2 bed 70 753 Flat 1.3 2 bed 62 667 Flat 1.4 2 bed 63 678 Total 289 3,110

Second Residential Flat 2.1 3 bed 94 1,012 Flat 2.2 2 bed 70 753 Flat 2.3 2 bed 64 689 Flat 2.4 2 bed 63 678 Total 291 3,132

Third Residential Flat 3.1 3 bed 94 1,012 Flat 3.2 2 bed 71 764 Flat 3.3 2 bed 64 689 Flat 3.4 2 bed 64 689 Total 293 3,154

Fourth Residential Flat 4.1 3 bed 108 1,163 Flat 4.2 2 bed 62 667 Flat 4.3 1 bed 50 538 Flat 4.4 2 bed 61 657 Total 281 3,025

Fifth Residential Flat 5.1 3 bed 110 1,184 Flat 5.2 3 bed 126 1,356 Total 236 2,540

Sixth Roof Terraces

Total 18 Apartments 1,390 14,961

24 WALTER HOUSE COVENT GARDEN 25 KEY Consented Scheme Residential Vertical circulation Plans Common areas BEDFORD STREET BEDFORD STREET

Typical Plan Fifth Floor (First –Third Floor) TOTAL NSA TOTAL NSA 236 sq m / 2,540 sq ft First 289 sq m / 3,110 sq ft Second 291 sq m / 3,132 sq ft

Third 293 sq m / 3,154 sq ft STRAND STRAND

BEDFORD STREET BEDFORD STREET

Fourth Floor Roof Terrace

TOTAL NSA 281 sq m / 3,025 sq ft STRAND STRAND

Floor plans not to scale, Floor plans not to scale, for indicative use only. for indicative use only.

26 WALTER HOUSE COVENT GARDEN 27 Market Summary

Residential West End Sales Market Retail West End Occupational Market

We expect the wider west end market to continue the election saw enquiry levels increase by As a retailing destination, Strand benefits from advantage of what is a 24/7 trading pitch as a to outperform the more traditional prime Central 25-30% when compared with the period directly its proximity to other key retailing hubs in Covent result of the abundance of cultural and lifestyle London areas due to the fact that it is still an before the election. Garden. The combination of the successful asset attractions in the area, and the proximity to excellent transport links. emerging prime central area for residential In 2016 we expect to see more buyers coming management and strict tenant mix policies of property. The stock within Covent Garden is across from the more traditional areas of the key estate holders has resulted in significant The prime pitch stretches from Charing Cross increasingly better quality and the area is benefitting and . This was a trend rental growth and increased tenant demand in to Southampton Street with the prime Zone A from the anticipation of Crossrail, as well as an spotted in 2014/15 and we expect this to adjacent locations outside their control. rents being achieved in excess of £360 per sq ft enhanced shopping and restaurant experience. continue as Covent Garden grows in reputation Retailing on Strand is predominantly a mix of demonstrating the significant rental increase Q2 2015 itself was divided by the general and comparative affordability. national high street multiples with a higher than which has occurred in this location. election. In the pre-election build-up, the market The table below provides a selection of recent average amount of A1 food and A3 units taking slowed, reflecting concerns about a possible comparable evidence in Covent Garden. mansion tax. In contrast in the latter part of the quarter, post-election, post Conservative victory, the market improved. In fact, the weeks following

Property Address Post Code Sale Price Sq ft £ psf Bedrooms Floor Exchange Date Address Tenant Transaction Date Rent Zone A Rate Comments Analysis subjective, can be analysed Hop House Penthouse WC2N £5,650,000 2,142 £2,638 3 Fourth / Fifth Feb-14 449 Strand Jigsaw Lease Regear Sep-15 £340,000 £315.00 to £300 ZA The Palladio 7 WC2E £3,950,000 1,442 £2,739 2 Fourth Oct-14 Premium of £250,000 paid. 7 months 32-33 Strand ITSU Open Market Letting Oct-14 £500,000 £385.00 rent free, tenant only break at year 15 Hop House 9 WC2N £908,000 431 £2,107 1 First Feb-15 Tenant's analysis equates to £238 ZA, 68-9 Strand Argos Open Market Letting Sep-14 £280,000 £250.00 with no discount for quantum of layout Bedford Street Apt 1, 17-19 WC2E £4,175,000 1,654 £2,524 2 First Jun-15 111 Strand Colour Company Rent Review Apr-14 £146,000 £180.25 Second, Third Strand, Gatti House, Apt 4 WC2R £5,250,000 2,325 £2,258 3 Jun-15 435 Strand Whittards of Chelsea Lease Renewal Jun-13 £550,000 £250.00 Lease prohibits all food use, & Fourth including A1 food Broad Court Apt 5, 21 WC2B £2,700,000 1,197 £2,255 2 Third / Fourth Jul-15 49-50 Strand Superdrug Lease Renewal Apr-13 £520,000 £263.00

The Beecham Apt 6 WC2E £4,450,000 1,603 £2,776 2 Third Aug-15 Lease provides for A1 or A2 use. 415 Strand Nationwide Rent Review Mar-13 £300,000 £235.00 5% allowance for shape The Tavistock Apt 4, WC2E £5,992,480 2,389 £2,508 3 Fourth / Fifth Aug-15 426-427 Strand H&M Open Market Letting Mar-13 £575,000 £256.00 15 year lease with a tenant only break 2-4 Catherine Street at year 7.9 months rent free

The Russell Hop House Bedford Street

28 WALTER HOUSE COVENT GARDEN 29 Market Summary

Office West End Occupational Market Investment West End Market

The Covent Garden submarket has CBRE’s prime rent in Covent Garden is Throughout 2015 demand for prime assets Low availability has continued to restrict witnessed high levels of take up over the forecast to stand at £78.00 per sq ft as at the in the has remained investment volumes with only £1.8 billion past year which has ranged from traditional end of 2015 with average annualised rental exceptionally strong. At mid-year 2015, of stock available at the beginning of the creatives to corporate and financial occupiers. growth predicted to be 4.4% up until 2019. £8.2 billion of stock has been sold, which is second quarter. The market is seeing an ever increasing The table below provides a selection of 17% higher than at the equivalent period in 2014 London has maintained its reputation as a appetite from business services and a number the most recent comparable occupational and the highest for the period since 2007. safe haven for foreign investment with investors of traditional Mayfair occupiers relocating transactions in the area: seeking secure returns on their capital. to Covent Garden in search of reduced total occupancy costs and a more vibrant amenity appeal.

Lease Net Initial Address Sq ft Floor Tenant Date Length £ psf Date Address Tenant Price Yield Capital Yield psf 2nd Automobile Association 4 Years 90 Long Acre, WC2 9,204 27/02/2015 £65.00 June 2015 30-33 Henrietta Street Multi-let £15.2m n/a £1,326 Unit 1 Developments Limited 6 Months Davidson Building, 5 / 8 Southampton Street, WC2 6,234 4th First Utility 17/04/2015 10 Years £72.50 May 2015 200 Strand , WC2 Multi-let £17.3m 3.98% £1,392

Davidson Building, 5 / 8 Southampton Street, WC2 4,372 5th Astus UK Limited 25/03/2015 10 Years £80.00 May 2015 64 / 76 New Multi-let £36.5m n/a £1,439

90 Long Acre, WC2 3,680 6th Kreab Group 13/02/2015 4 Years £60.00 Dec 2014 31-33 Bedford Street, WC2 Multi-let £30.0m n/a £1,219 Cable & Wireless 62 / 65 Chandos Place, WC2 3,510 2nd 10/12/2014 10 Years £69.50 Nov 2014 10 Bedford Street, WC2 Multi-let £65.1m 3.91% £1,330 Communications Plc Kean House, 6 Kean Street, WC2 2,986 5th IFLS 25/02/2015 5 Years £59.50

Kean House, 6 Kean Street, WC2 2,969 3rd SVG Capital 27/03/2015 5 Years £60.00

17 Slingsby Place, WC2 2,732 3rd Point 2 Surveyors Limited 18/12/2014 5 Years £67.50

90 Long Acre Kean House Davidson Building 10 Bedford Street 33 Henrietta Street 33 Bedford Street

30 WALTER HOUSE COVENT GARDEN 31 Further Information

Planning VAT The property is located in the The property has been elected for VAT purposes Covent Garden Conservation Area. and it is intended to treat the transaction as a transfer of going concern (TOGC). EPC Energy Performance Certificates will Proposal be made available in the data room. Offers are sought in excess of £25,250,000 subject to contact and exclusive of VAT. Pricing at this level reflects a capital value of £723 per sq ft on the existing GIA of the offices assuming a net initial yield of 4.20% on the retail element once fully let at our assumed ERVs (assuming standard purchaser’s costs of 5.80%).

Contact

Further information is available via the data room. For access details please contact CBRE.

For Commercial enquiries, please contact:

Ella Johnson Niall Gallagher DISCLAIMER: CBRE Limited CBRE Limited on its behalf and for the Vendors or Lessors [email protected] [email protected] of this property whose Agents they are, give notice that: 1. These particulars are set out as a general outline only for 020 7182 2517 020 7182 2584 guidance to intending Purchasers or Lessees, and do not 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 For Residential enquiries, please contact: or representations of fact, but must satisfy themselves by inspection or otherwise as to the correctness of each of them. Charlie Philip James Mashiter 3. No person in the employment of CBRE Limited has any authority to make any representation or warranty whatsoever [email protected] [email protected] in relation to this property. 4. Unless otherwise stated, all prices and rents are quoted exclusive of VAT. October 2015. 020 7182 2442 020 7420 3018 siren | +44 (0)20 7478 8300 | sirendesign.co.uk | S06693

32 WALTER HOUSE COVENT GARDEN 33 34 WALTER HOUSE