Prime reversionary East Midlands logistics investment opportunity ALLOGA UK LTD AMBER PARK 1 | BERRISTOW LANE SOUTH NORMANTON | DE55 2FH ALLOGA UK LTD Amber Park 1 | Berristow Lane | South Normanton | DE55 2FH PRIME REVERSIONARY EAST MIDLANDS 2 LOGISTICS INVESTMENT OPPORTUNITY MacArthur Glen Normanton Brook Rd Berristow Ln Retail Outlet Village Alloga Alloga A38 Radius Systems Radius Systems Alliance Healthcare XPO Logistics M1 South to M1 North to M1 Junction 28/A38 Junction 29 Investment Summary Location • Prime distribution warehouse located within a strategic Amber Park occupies a strategic location just off and prominent location on Amber Park just off Junction Junction 28 of the M1 on the east side of the Motorway 28 of the M1 Motorway; at Sutton in Ashfield. • Modern distribution facility totalling 208,055 sq ft; The location benefits from excellent road communications as it lies at the intersection of the M1 motorway and the A38 • Let to Alloga UK Limited (Company Number: 03169255), trunk road. The A38 provides direct access westbound to who are the market leader in healthcare pre-wholesaling Derby, Burton on Trent, Birmingham and the South West; and benefit from an excellent covenant strength of 4A1 and Mansfield to the east. (D&B), indicating minimum risk of business failure; Amber Park is located sitting between the key centres of • Tenant has critical mass at South Normanton, occupying Nottingham 14 miles to the south, Derby 16 miles to the over 1m sq ft of accommodation across six buildings south west, and Sheffield 20 miles to the north. at Castlewood Business Park and Amber Park; East Midlands Airport is conveniently located 22 miles • Let on a new FRI lease from practical completion of the to the south, adjacent to Junction 24 of the M1 motorway. roof works (estimated July 2017), for a term of 10 years, The airport provides fights to more than 90 destinations with a tenant only break option on the fifth anniversary worldwide and handles more than 4.5 million passengers of the term (subject to a break penalty of £552,600); a year. East Midlands Airport is the UK’s busiest pure • Low initial contracted rent of £921,000 (£4.43 per sq ft); cargo airport and second only to Heathrow. It is the home to a number of leading freight operators including • Freehold investment; DHL, TNT, UPS and Royal Mail. • The subject property plays a central role for the tenant’s operations, providing office headquarters for the business, and provides a principal storage facility for their fulfilment process; • We are instructed to seek offers in excess of£14,380,000 subject to contract and exclusive of VAT, which reflects a net initial yield of 6.00% and a low capital value of £69 per sq ft. This assumes purchasers costs of 6.73%. 3 SHEFFIELDB6023 M1 Hilcote B6046 B6027 A619 Normanton Brook Rd Chesterfield Shirebrook J29 A1 A614 A38 Matlock A61 Mansfield A38 A617 Berristow Ln Alfreton J28 M1 A6 A38 A515 A60 J27 East Midlands A38 Designer Outlet Belper Hucknall A46 South J26 A52 DERBY Normanton NOTTINGHAM Castlewood J25 Business Park Beeston A50 J24 J28 Barrow East B6019 upon Trent Midlands Airport J23a A46 A42 Loughborough M6 M1 SituationM42 J21 The property is prominently situatedM6 on9 Berristow Lane, the main arterial road through Amber Park, which forms one of Derbyshire’s key established industrial locations, along with the neighbouring Castlewood Business Park. Access to Amber Park is provided from the A38 Mansfield M42 M6 Road, connecting with Junction 28 of the M1 J1Motorway9 within one mile to the south west. The MacArthur Glen East Midlands Designer outlet is located a short distance from the property on the junction of the B6046 and A38. The 140,000 sq ft 70 store scheme includes brands such as Nike, Adidas, Levis and M&S. Destination Miles Km The situation of the property suits Alloga UK Limited well due to its excellent access to the UK motorway network Road via Junction 28 of the M1 Motorway, along with the quality M1 Motorway (J28) 0.9 1.5 of the available local employee skills. City Nearby industrial occupiers include Co-operative Food, Nottingham 14 22.5 Parker Knoll, Diversey and TDG. Derby 16 26 Sheffield 20 32 Birmingham 61 98 Air East Midlands Airport 22 35 ALLOGA UK LTD Amber Park 1 | Berristow Lane | South Normanton | DE55 2FH PRIME REVERSIONARY EAST MIDLANDS 4 LOGISTICS INVESTMENT OPPORTUNITY Description Site The property is a 208,055 sq ft modern distribution The property occupies a site of approximately warehouse completed in 1997. 12.96 acres (5.24 ha) with a low site density of 37%. The warehouse is of steel portal frame construction, with profile steel clad elevations. There is a three storey office to the rear of the property. Accommodation The building benefits from the following specification: • 48 metre self-contained yard • 10 Dock level access loading doors The property has been measured on a Gross Internal Area basis in accordance with the RICS Property Measurement • 4 Level Access loading doors (1st edition), and provides the following approximate areas: • 11.8 metre eaves height • c.250 car parking spaces Description sq m sq ft • 20 trailer parking with 7 further HGV spaces The property has substantial tenant fit out, including a high Warehouse & Office 18,551 199,681 security vault and chilled areas, which are to be fully reinstated First Floor offices 389 4,187 at lease expiry. The property will also benefit from a new roof, which is currently under construction, and is due to complete Second floor offices 389 4,187 in July 2017. The new roof is being replaced due to the strict requirements of the tenant’s operations. Full construction Total 19,329 208,055 warranties will be made available to the purchaser. 48m N 5 Tenure The property is held on a freehold basis. Tenancy The property is currently let in its entirety to Alloga UK Limited (Company number: 03169255), who have been in occupation of the building since it was built in 1997. Alloga UK Limited have entered into a new reversionary agreement for lease on full repairing and insuring terms for a term of 10 years from practical completion of the roof works (estimated July 2017). There is a tenant only break option on the fifth anniversary of the term, subject to 6 months notice, providing 5 years unexpired term certain to break. The tenant is obliged to pay a capital sum of £552,600 if the break option is exercised. The new contracted rent is £921,000 per annum (£4.43 per sq ft). The rent benefits from an upwards only rent review on the 5th anniversary of the term. There is no rent free period at the commencement of the new lease. ALLOGA UK LTD Amber Park 1 | Berristow Lane | South Normanton | DE55 2FH PRIME REVERSIONARY EAST MIDLANDS 6 LOGISTICS INVESTMENT OPPORTUNITY Covenant Alloga UK Limited (Company number: 03169255) (“Alloga THE PHARMACEUTICAL PRE-WHOLESALE MARKET UK”) is a pre-wholesaling and contract logistics company, with a client list including 20 of the 50 largest blue-chip The UK pharmaceuticals market is a highly regulated pharmaceutical companies in the UK, and is the market market, where the stock must be stored under licensed leader in healthcare pre-wholesaling within the UK. conditions. Furthermore, there are strict regulations that determine the temperature range, and security provisions Alloga UK is one of only three specialist pharma pre- that certain products must be stored at. Alloga UK is wholesalers in the UK, and has experienced significant a sophisticated and complex business operating a seamless growth over the last five years. Today, the company fulfilment chain of 6 buildings in South Normanton. employs 850 employees and has six warehouse facilities, all located in South Normanton, Derbyshire , from which Due to the sensitive nature of many of the products Alloga UK distributes globally. being handled, Alloga UK have made several investment commitments to the buildings they occupy and would The company is a member of Walgreens Boots Alliance, find it both expensive and technically difficult to which is the first global pharmacy-led, health and wellbeing simply move to a “standard” logistics unit. enterprise in the world, employing over 400,000 people across 25 countries, and is the largest retail pharmacy, health and daily living destination in the USA and Europe, and is: ALLOGA UK – ACCREDITATION • The global leader in pharmacy-led, health and wellbeing MHRA (Medicines and Healthcare products Regulatory retail with over 13,200 stores in 11 countries Agency) and Home Office-approved and GDP- compliant, Alloga UK’s extensive list of accreditations and licences • One of the largest global pharmaceutical wholesale and allows Alloga UK to offer a comprehensive service portfolio distribution networks with over 390 distribution centres designed to optimise client supply chains. The company is delivering to more than 230,000+ pharmacies, doctors, also ISO accredited for ISO 9001: 2008 Quality Management health centres and hospitals each year in 20 countries Systems, ISO 14001: 2004 Environmental Management Systems, and most recently ISO 22301: 2012 Societal • One of the world’s largest purchasers of prescription Security - Business Continuity. drugs and many other health and wellbeing products. Alloga UK have a Dun & Bradstreet rating of 4A1, indicating a minimum risk of business failure. The company has produced the following headline figures over the past 3 years demonstrating impressive and consistent sales growth: 31 Aug 15 30 Sep 14 30 Sep 13 Sales Turnover £59,496,000 £55,760,000 £50,018,000 Pre-Tax Profit £14,677,000 £14,269,000 £12,438,000 Tangible £19,240,000 £18,636,000 £22,551,000 Net Worth 7 Occupational Market Commentary In the UK, overall, occupational demand for modern and well located logistics facilities remains strong.