100% PRIME RETAIL UNIT LET TO ARCADIA GROUP FOR A FURTHER 22 YEARS 7 MONTHS 62A, 64 and 66 Linthorpe Road & 1 Corporation Street, Middlesbrough TS1 1RA EXECUTIVE SUMMARY n 100% prime location amongst leading national retailers n Immediately opposite the recently opened Flannels, Sports Direct and USC units n Let for a further 22 years and 7 months to the Arcadia Group n Passing rent of £174,000 per annum n Freehold n Asking price - £3.11M (Three million, one hundred and ten thousand pounds) excluding VAT reflecting a net initial yield of 5.25% after purchasers’ costs at 6.46% 100% PRIME RETAIL UNIT LET TO ARCADIA GROUP FOR A FURTHER 22 YEARS 7 MONTHS LOCATION Middlesbrough is the economic and The economy within Middlesbrough is administrative centre for Teesside. The town based predominantly on manufacturing, is located approximately 40 miles south of chemical production, and shipping with Newcastle, 12 miles east of Darlington and Tees Port providing major employment 60 miles north east of Leeds. opportunities. Tees Port is currently the 3rd Middlesbrough has a population of largest port in the UK and one of the 10th 138,900 (Middlesbrough Council 2016) largest in Western Europe handling over with a wider catchment population of 56m tons of domestic international cargo. 662,600 within a radius of 12 miles. Middlesbrough also has a thriving University with a student body in excess The town is easily accessible from the A66 of 24,000 contributing over £124m per leading to the A19 and A1(M). By rail the annum to the Middlesbrough economy. town is connected to the rest of the UK via A1046 Darlington or York on to the East Coast line A1046 with journey times to London being 2 hours and 50 minutes. The nearest airport is A178 Durham Tees Valley airport located 12 miles to the south. A1027 River Tees ASHINGTON MORPETH PROPERTY A1027 A1046 A1(M) A696 Newcastle A178 NORTH RD MIDDLESBROUGH Airport A19 A68 North Scotland T A19 TYNEMOUTH e RIVERSIDE e Port of Tyne s STADIUM B A69 r A66 HILLSTREET NEWCASTLE SOUTH id HARTINGTON RD CENTRE Glasgow SHIELDS JURYS CINEMA UPON TYNE A19 g NANDO’S A139 e INN FITNESS GYM Edinburgh A BUS A68 A19 p MCDONALDS GATESHEAD 65 SUNDERLAND p STATION AMERICAN GOLF A177 Teesway ro TOWN SUBWAY ac HALL LAW PIZZA HUT Newcastle A1(M)63 A1046 h Rd NEWPORT RD ALBERT RD COURT Redcar Sunderland A1032 CLEVELAND BOROUGH RD A66 Carlisle MIDDLESBROUGH CHESTER-LE-STREET SEAHAM SHOPPING A690 Marston Rd B6541 CENTRE MARTON RD DURHAM 62 A1046 MIDDLESBROUGH A172 A1305 A167 A181 Leeds A689 HEYWOOD ST A690 61 Crofton Rd HARTLEPOOL TEESSIDE ManchesterSTOCKTON-ON-TEES UNIVERSITY Liverpool 60 B6541 A688 A689 A1089 Nottingham Teesport A19 B1272 Birmingham A68 A66 59 STOCKTON Albert Park A1305 A688 England 58 MIDDLESBROUGH A1 WEST LANE DARLINGTON HOSPITAL MIDDLESBROUGH Wales A171 A66 A66 10 miles INSTITUTE OF MODERN ART Cardiff London 57 Queen’s Stockton Rd Bristol A66 Campus 56 Durham Tees A172 Valley Airport A66 SCOTCH CORNER A19 A1(M)Princeton Dr A19 South B1032 A1130 A684 B6541 MIDDLESBROUGH A135 Teesside COLLEGE Shopping Park 100% PRIME RETAIL UNIT LET TO ARCADIA GROUP FOR A FURTHER 22 YEARS 7 MONTHS A1130 A19 REGENERATION OF MIDDLESBROUGH Middlesbrough town centre has benefited from significant regeneration works over the last 24 months with more works planned in a multi phased programme. Teesside University Campus, located one third of a mile to the south has undergone a £30m improvement programme with new build and refurbished properties completed. Significant public realm monies have been spent in and around Baker Street and Bedford Street which have led to full occupation and the introduction of 17 new businesses in this area. A new 138 bed Holiday Inn Express situated on Albert Road, Further large scale proposals to support the town centre are 300 yards to the south east of the subject property, was at a detailed consultation stage including construction of up opened in 2015 and has subsequently been extended by a to 200,000 sq ft of Grade A offices in Albert Park behind the further 25 rooms in 2017, along with the introduction of a regional Law Courts 300 yards to the east and additional Bistrot Pierre restaurant. Premier Inn has very recently opened public realm works on Southfield Road. The town hall on a hotel adjoining the A66. Albert Road located 150 yards to the east is currently being extensively refurbished for Council occupation. 100% PRIME RETAIL UNIT LET TO ARCADIA GROUP FOR A FURTHER 22 YEARS 7 MONTHS SITUATION The property is located in a 100% prime retail location on a busy opposite are a newly opened Flannels, Sports Direct and USC pedestrianised section of Linthorpe Road with its junction of (former BHS store). Other major retailers in the immediate vicinity Corporation Road. It lies between the Cleveland Centre and the Hill include Next plc, Marks & Spencer, Caffe Nero, Goldsmiths, Street shopping centres. Immediate neighbouring retailers include Deichman Shoes , Holland & Barratt, Foot Asylum, Virgin, Vodafone, House of Fraser and Debenhams department stores. Directly Hayes Travel, Beaverbrooks and Patisserie Valerie. Middlesbrough Train Station A66 Middlesbrough Leisure Park Hillstreet Shopping Centre Gurney Street Triangle M&S PROPERTY Debenhams Centre North East Patisserie Valerie Teesside Combined Court House of Fraser Town Hall and Council Chamber Captain Cook Square Shopping Centre The Cleveland Centre Linthorpe Road Bistrot Pierre New 200,000 sq ft Grade A (Prime Retail Pitch) Middlesbrough Institute Albert Park Pavilion Office Development of Modern Art Holiday Inn Express Proposed 566 bed student accommodation development Baker Street & Bedford Street Character Area Teesside University Campus 100% PRIME RETAIL UNIT LET TO ARCADIA GROUP FOR A FURTHER 22 YEARS 7 MONTHS DESCRIPTION The property comprises a prominent corner retail unit constructed over ground and two upper floors plus attic, built of brick construction under a pitched slate roof. The property has frontages to both Linthorpe Road and Corporation Road and provides retail sales space on the ground and most of the 1st floor with ancillary storage on part 1st and 2nd floors. The attic is unused. Servicing is from the front. ROYAL BRITANNIA FLANNELS SPORTS DIRECT USC GOAD PLAN NORTH 100% PRIME RETAIL UNIT LET TO ARCADIA GROUP FOR A FURTHER 22 YEARS 7 MONTHS ACCOMMODATION We have been provided with the following net internal areas: FLOOR SQ FT SQ M Ground Floor 1,720 159.8 Sales (ITZA 1,221) (ITZA 113.40) First Floor Sales 1,000 92.90 Stores 265 24.60 Second Floor Stores 914 84.90 Attic Not in use 166 15.4 TOTAL 4,065 377.6 TENURE Freehold. 100% PRIME RETAIL UNIT LET TO ARCADIA GROUP FOR A FURTHER 22 YEARS 7 MONTHS TENANCY The entire property is leased to Miss Selfridge Properties Ltd with a guarantee from Arcadia Group Ltd on a 35 year unbroken FR & I Iease from 24 August 2005 expiring on the 23 August 2040. The lease therefore has approximately 22 years and 7 months unexpired. The passing rent is £174,000 p.a. subject to 5 yearly upward only reviews. The tenant has been in occupation since the 1950’s when they traded as Burtons, before being taken over by the Arcadia Group in 1998. COVENANT Miss Selfridge Properties Ltd are part of the Arcadia Group, an international retailing company operating a number of leading fashion brands including Miss Selfridge, Burton Menswear, Outfit, Topshop, Topman. The group has an omni channel retail offering with a market leading e-commerce platform as well as being represented in most major retail centres and high streets. Arcadia Group Ltd (00237511) Act as guarantors to the lease, are a substantial company with a turnover in excess of £2Bn and employing over 12,000 people. Further information is available on www.arcadia.co.uk The latest accounts information for Arcadia Group Limited is summarised in the table below: PRE-TAX SHAREHOLDERS YEAR ENDING TURNOVER PROFIT FUNDS 27/8/2016 £2,009,78,000 £130,718,000 £2,423,033.000 29/8/2015 £2,069,267,000 -£18,106,000 £2,582,380,000 30/8/2014 £2,032,940,000 £275,198,000 £2,793,072,000 Creditsafe give the company a credit rating of 92 out of 100 and described it as “Very Low Risk” with a suggested contract limit of £500m. Their international rating is ‘A’, Creditsafe’s highest rating indicating “very low risk”. The tenant has a D&B rating of 5A1. 100% PRIME RETAIL UNIT LET TO ARCADIA GROUP FOR A FURTHER 22 YEARS 7 MONTHS RETAIL COMMENTARY Middlesbrough is the dominant retail core for Teesside and its wider catchment area with three major shopping centres and a total of 120,775 sq m (1.3m sq ft) of retail accommodation. The subject property lies between the main entrances to the Hill Street Centre and The Cleveland Centre (Wesley Mall) and benefits from the pedestrian flow between these centres. There are a number of anchor tenants in the immediate vicinity including House of Fraser, Marks & Spencers, Debenhams, Next Plc and the newly opened Flannels, Sports Direct and USC units. Like many centres Middlesbrough has experienced a contraction in occupied retail space. Movement has been from secondary locations to the central pedestrianised section of Linthorpe Road leading to near full occupation. Ongoing and future regeneration works are likely to continue to benefit the centre through additional visitors and spend. 100% PRIME RETAIL UNIT LET TO ARCADIA GROUP FOR A FURTHER 22 YEARS 7 MONTHS CAPITAL ALLOWANCES PROPOSAL There are no capital allowances available. Offers are sought of £3,110,000 VAT The property is elected for VAT and it is (Three million, one hundred and proposed that the sale will be dealt with by a Transfer of a Going Concern.