Prime Retail Investment with Planning Consent for 14 Residential Units HARROGATE — 27-31 CAMBRIDGE STREET Computer Generated Image FawcettPostcode: Mead HG1 1RW HARROGATE – 27-31 CAMBRIDGE STREET 1 Computer Generated Image Fawcett Mead HARROGATE – 27-31 CAMBRIDGE STREET 2 INVESTMENT SUMMARY • The historic Georgian spa town of Harrogate is an attractive retail centre with an affluent catchment population – It is one of the most sought after investment locations in the UK. • Harrogate was named as the best place to live in the UK by Rightmove from 2012-2015 and came second in 2019. • House prices in Harrogate rose by 8% from June 2019 - May 2020 compared to a national average of 2% (plumplot.co.uk). • The property benefits fromplanning permission to create 14 residential units above the existing retail with eight car parking spaces to the rear. Application numer 19/03508/FULMAJ. • The property occupies a 100% prime trading location on the pedestrianised Cambridge Street opposite Primark and Boots. • New letting to Bodycare on a 10 year lease from 24th December 2019 at a rebased rent of £125,000 per annum, with no tenant break option. • The Bodycare unit is unaffected by the propsed development, providing income through the build period. • Freehold. • £3,500,000 (Three Million Five Hundred Thousand Pounds). Fawcett Mead HARROGATE – 27-31 CAMBRIDGE STREET 3 A61 A19 A64 A59 A65 A59 Harrogate A59 A166 A65 A59 A658 A661 York A1079 A59 A629 A56 A658 A64 A61 A660 A58 A19 A6068 A64 A64 A658 Leeds A63 A6036 A629 A63 A1041 A646 A58 A646 A644 A6033 A1 A19 A642 LOCATION The historic spa town of Harrogate lies at the heart of North Yorkshire, approximately 212 miles north of London, 16 miles north of Leeds and 19 miles west of York. The town is served by the A61 running from Leeds to Thirsk and the A59 running from York to Preston. The A1M is located approximately 7 miles to the east of the town centre. Leeds/Bradford Airport is situated 10 miles to the south. Harrogate is also well served by the rail network, with Harrogate Railway Station providing direct trains to London Kings Cross in around 2 hours 50 minutes, Leeds in 30 minutes and York in 40 minutes. Harrogate is also home to one of Europe’s largest exhibition and conference centres, which attracts around 300,000 guests annually. Harrogate also hosted the 2019 UCI Road Cycling World Championships, which followed on from the success of hosting the Tour de France in 2012. Fawcett Mead HARROGATE – 27-31 CAMBRIDGE STREET 4 RETAILING IN HARROGATE Harrogate comprises a highly attractive and historic retail environment which is dominated by the pedestrianised Cambridge Street and James Street. Cambridge Street offers a number of large national multiple occupiers such as Marks and Spencer, Boots, Next and Primark. James Street offers a boutique shopping environment with occupiers including Mint Velvet, Whistles, Hobbs and Ogdens of Harrogate. The Victoria Shopping Centre is the only covered shopping centre in the town, located on Cambridge Street. Harrogate is also home to the famous Betty’s Tea rooms along with a thriving restaurant and bar scene with occupiers including The Ivy, Yo Sushi, Banyan, Nando’s and Wagamama. DEMOGRAPHICS Harrogate has a catchment population of approximately 3 million people with a local shopping population of approximately 160,000. The town has one of the most affluent shopping profiles in the UK with 63% of the population within the highest AB and C1 demographic groups. The population is expected to increase by circa 6% by 2035. Harrogate’s catchment population is significantly increased by tourism. In 2019 it was estimated that there were around 7.5m visitors to the town. 7.5 million 3 million day visitors in 2019 catchment population Fawcett Mead HARROGATE – 27-31 CAMBRIDGE STREET 5 SITUATION The property occupies a 100% prime trading position on the pedestrianised Cambridge Street, directly opposite Primark. Other retailers in the immediate vicinity include: The property is also very well situated for the residential development as Harrogate train station is just 180 metres from the property, ideal for residents who plan to commute to Leeds or York. The Stray, which is 200 acres of green space is also just 140 metres from the property. There are also a number of restaurants, cafes and gyms in the vicinity providing amenities to local residents. Fawcett Mead HARROGATE – 27-31 CAMBRIDGE STREET 6 HARROGATE HOUSING MARKET There is a buoyant housing market in the Harrogate region. The area from Harrogate is well known for its open green space in the town centre, which is called Harrogate, North Leeds and York is often referred to as being the “Golden “The Stray”. The Stray consists of 200 acres of green space, which surrounds the Triangle”. This is due to the affluence of the area and relatively high house town centre on three sides. Valley Gardens is also in the town centre and consists prices. The average house price in Harrogate increased by 8% in the twelve of 17 acres including woodland, open green space along with outdoor activities months from June 2019 – May 2020. This compares favourably to the national including tennis, pitch and putt, crazy golf, boating pools, paddling pools and a average of 2%. children’s play area. The graph below shows that Harrogate house prices have consistently risen Harrogate also has a wide selection of restaurants and cafes, including the famous faster than the England & Wales average over the past 25 years. (Source: Betty’s Tea Rooms in the town centre along with gyms including David Lloyd, plumplot.co.uk) PureGym and local independent gyms. All of these factors support the local residential market by providing a highly desirable place to live. £350,000 £300,000 £250,000 £200,000 £150,000 £100,000 £50,000 £0 www.visitharrogate.co.uk 1995 2000 2005 2010 2015 2020 Harrogate England & Wales Fawcett Mead HARROGATE – 27-31 CAMBRIDGE STREET 7 DEVELOPMENT OPPORTUNITY Harrogate Stray, which is 200 acres of open green space is also just 140 metres away from the property. There are a number of restaurants, bars and gyms to serve the residential occupies all within five minutes’ walk of the property. There is a strong market in Harrogate town centre for owner occupied flats and buy to let flats. Flat Area sq ft Beds Level Retail unit 1 will be reconfigured to provide the following approximate 1 1,223 2 First floor areas: 2 904 2 First floor Unit Floor sq ft 3 987 2 First floor 1 Ground 2,670 4 1,036 2 First floor ITZA 1,199 5 839 2 First floor Total 2,670 6 879 2 First floor Based on the analysis of the most 7 1,055 2 First floor recent comparable letting to Bobycare 8 799 2 Second floor at £82.70 Zone A Net, we would apply an ERV of £100,000 per annum to the 9 734 2 Second floor reconfigured unit. The property benefits from planning permission to convert and extend the upper parts into 14 residential units along with eight car parking spaces to the 10 586 1 Second floor rear. Upon the implementation of the planning permission there is a community 11 699 2 Second floor infrastructure levy of £255,000, payable to the local authority. 12 713 2 Second floor The development has been designed to a high specification, with large floor plates and a double height atrium in the centre of the development allowing 13 728 2 Second floor large amounts of light into the residential units. The property is also well situated 14 902 2 Second floor in the town centre for residential occupiers as it is just 180 metres from the train station, which would suit commuters to Leeds and York extremely well. Total 12,084 Fawcett Mead HARROGATE – 27-31 CAMBRIDGE STREET 8 DEVELOPMENT OPPORTUNITY The plans show the proposed development opportunity. More information is available under application number 19/03508/FULMAJ or upon request. Retail unit 2 is let to Bodycare and will not be affected by the development. Retail unit 1 will be reconfigured and have an access corridor installed as shown. Proposed Ground Floor Proposed First Floor Proposed Second Floor Cambridge Street Unit 1 Unit 2 Bodycare Reconfigured Fawcett Mead HARROGATE – 27-31 CAMBRIDGE STREET 9 TENURE Freehold TENANCY Unit 1 is let in its entirety to River Island Clothing Co Limited for a term of 2 years from 30th September 2020 on 2.5% of turnover inclusive. Vacant possesion can be obtained upon 4 months written notice after 12 months from lease commencement to enable the development. EXISTING ACCOMMODATION Unit 2 is let to G.R & M.M Blackledge PLC t/a Bodycare for a term of 10 years from 24th December 2019 with The subject property provides the following approximate net internal floor areas: an upwards only rent review after 5 years. The current rent is £125,000 per annum. Address Floor Use sq ft Ground Floor Sales 4,155 Unit 2 first floor is currently vacant to enable the Unit 1 proposed development. ITZA (units) 1,511 First Floor Sales 4,833 TOTAL 8,988 RENTAL ANALYSIS Ground Floor Sales 4,730 Unit 2 ITZA (units) 1,511 We have analysed the rent for unit 2 (Bodycare) to reflect TOTAL 4,730 £82.70 Zone A. The previous passing rent of £226,500 per annum reflected £150 Zone A, which is in line with Unit 2 To be First floor 4,485 the pre-recession peak for Cambridge Street. Vacant space developed TOTAL 4,485 OVERALL TOTAL 18,203 Fawcett Mead HARROGATE – 27-31 CAMBRIDGE STREET 10 COVENANT INFORMATION Bodycare (GR & MM Blackledge PLC) The company was founded in 1970 by Graham and Margaret Blackledge and offers a range of premium fragrances, hair and skin products.