fetter lane, london ec4 - allsop · 2019. 10. 31. · one fetter l ane 3 one fetter l ane 2...
TRANSCRIPT
O N E F E T T E R L A N E
1
P R I M E M I D T O W N F R E E H O L D M I X E D U S E R E F U R B I S H M E N T O P P O R T U N I T Y
F E T T E R L A N E , L O N D O N E C 4
ON E
O N E F E T T E R L A N E
3
O N E F E T T E R L A N E
2
E X E C U T I V ES U M M A R Y
Freehold.
Prominent corner building in a prime Midtown location on the junction of Fetter Lane and Fleet Street, within close proximity of City Thameslink, Farringdon and Chancery Lane stations.
24,056 sq ft (2,234.9 sq m) of office, retail and ancillary accommodation arranged over lower ground, ground and six upper floors.
Multi-let to one office tenant and four retail tenants producing a total rent of £1,199,000 per annum (£49.84 per sq ft overall).
Low passing office rent of only £46.98 per sq ft compared to prime Midtown rents in excess of £75.00 per sq ft.
Highly reversionary retail income accounting for c.23% of the overall income, with average rents of £152 Zone A, with rents on Fleet Street in excess of £200 Zone A.
Opportunity to increase the net lettable area of the building by 3,306 sq ft (307.1 sq m) subject to obtaining the necessary consents.
Weighted Average Unexpired Lease Term to earliest determination of approximately 0.5 years on the office space and 9.35 years on the retail accommodation.
Offers are sought in excess of £21,000,000 for the freehold interest subject to contract and exclusive of VAT. This reflects a net initial yield of 5.35% and a capital value of £873 per sq ft on the existing area and £767 per sq ft on the proposed area, assuming 6.75% purchaser’s costs.
Applying a yield of 4.50% to the existing retail income this pricing equates to £776 per sq ft on the existing office area and £664 per sq ft on the proposed office area.
O N E F E T T E R L A N E
5
L O C A T I O N
THE PROPERTY IS PROMINENTLY SITUATED ON THE CORNER OF FETTER LANE AND FLEET STREET. THE CITY CORE IS LOCATED LESS THAN A 10 MINUTE WALK TO THE EAST, WITH CLERKENWELL AND COVENT GARDEN EQUIDISTANT TO THE NORTH EAST AND WEST RESPECTIVELY.
Fleet Street is one of the key arterial routes linking the City and the West End. It forms part of the ceremonial route through Central London from St Paul’s and is synonymous with both the press and legal sector. The property, on the corner of Fetter Lane, is ideally situated for access to the Royal Courts of Justice, the Law Society, Middle and Inner Temples and Lincoln’s Inn.
The adjacent street of Chancery Lane has seen large scale redevelopment projects including Derwent London’s 40 Chancery Lane (HQ of Saatchi and Saatchi), Aberdeen’s The Cursitor Building and Viridis’ 28 Chancery Lane. Traditionally associated with the legal sector, Midtown now attracts a hugely diverse occupier base, including those from the technology, media and telecommunication (TMT) sector.
Framestore, Skype, Amazon, Saatchi & Saatchi, WeWork and Deloitte Digital are some of the occupiers who have taken occupation of nearby schemes in recent years.
The property benefits from excellent surrounding transport infrastructure situated a short walk from City Thameslink National Rail and Chancery Lane (Central Line) Underground Stations. Farringdon National Rail and Underground station is approximately a 10 minute walk to the north- west and will benefit from The Elizabeth Line by mid-2020. It is estimated that the new rail line will bring an extra 1.5 million people to within 45 minutes of Central London.
GOODGESTREET
OXFORDCIRCUS
GREEN PARK
MARBLE ARCH
HYDE PARKCORNER
KNIGHTSBRIDGE
EUSTON
MONUMENT
SHOREDITCHHIGH STREET
LEICESTERSQUARE
CHARINGCROSS
WATERLOO
LONDONBRIDGE
WATERLOOEAST
EMBANKMENT
SOUTHWARK
BOROUGH
OLD STREET
CIT YTHAMESLINK
PICCADILLYCIRCUS
TOTTENHAMCOURT ROAD
BOND STREET
LIVERPOOLSTREET
RUSSELLSQUARE
MANSIONHOUSE
BANK
BARBICAN
CANNONSTREET
MOORGATE
COVENTGARDEN
CHANCERYL ANE
HOLBORN
ST PAUL’S
BL ACKFRIARS
FARRINGDONFARRINGDON
EASTERN TICKET HALL
TEMPLE
450M
800M
700M
350M
500M 500M
C O N N E C T I V I T Y
1 Fetter Lane benefits from the following excellent transport connectivity
Central Line
Hamm
ersmith & City Line
Circle Line
Metropolitan Line
London Underground
Elizabeth Line
District Line
Piccaddily Line
National Rail
O N E F E T T E R L A N E
4
O N E F E T T E R L A N E
7
WA
TER
LOO
BR
IDG
E
LO
ND
ON
BR
IDG
E
SO
UT
HW
AR
K B
RID
GE
HIGH HOLBORN HOLBORN
FETTERL
AN
E
KIN
GS
WA
Y
WO
BU
RN
PLAC
E
SOU
THA
MPTO
N RO
W
OXFORD STREET
CH
AR
ING
CR
OS
S R
OA
D
BLOOMSBURY WAY
HIGHHOLBORN
GR
AY
’S IN
N R
OA
D
FARRIN
GD
ON
ROA
D
FA
RR
ING
DO
N R
OA
D
FA
RR
ING
DO
N S
TR
EE
T
THEOBALD’S ROAD
CLERKENWELL ROAD
STRAND
STRAND
RE
GE
NT STR
EE
T
FLEET STREET
LINCOLN’S INNFIELDS
MIDDLE TEMPLEGARDENS
VICTORIA EMBANKMENTUPPER THAMES STREET
QUEEN VICTORIA STREET
LONDON WALL
HOLBORN VIADUCT
LOWER THAMES STREET
CANNON STREET
THREADNEEDLE STREET
GRESHAM STREET
MO
OR
GA
TE
GR
AC
EC
HU
RC
H S
TR
EE
T
BIS
HO
PSG
ATE
COM
MERCIA
L STREET
GREAT EASTERN STREET
CIT
Y R
OA
D
OLD STREET
AL
DE
RS
GA
TE
ST
RE
ET
KIN
G W
ILLIAM
STR
EE
T
ALDWYCH
CH
AN
CE
RY
LA
NE
HA
TT
ON
GA
RD
EN
CHARTERHOUSE STREET
WEST SMITHFIELD
RUSSELLSQUARE
GOODGESTREET
OXFORDCIRCUS
GREEN PARK
MARBLE ARCH
HYDE PARKCORNER
KNIGHTSBRIDGE
HOLBORN
EUSTON
ST PAUL’S
MANSIONHOUSE
MONUMENT
BANK
BARBICAN
CHANCERYLANE
SHOREDITCHHIGH STREET
LEICESTERSQUARE
CHARINGCROSS
WATERLOO
LONDONBRIDGE
WATERLOOEAST
EMBANKMENT
TEMPLE
SOUTHWARK
BOROUGH
BLACKFRIARSCANNONSTREET
OLD STREET
CITYTHAMESLINK
PICCADILLYCIRCUS
TOTTENHAMCOURT ROAD
BOND STREET
FARRINGDON
MOORGATE
LIVERPOOLSTREET
COVENTGARDEN
1
23
4
5
2
2
7
6
11
8
9
10 13
14
15
16
17
14
18
19
12
20
22
25
24
23
21
L O C A L O C C U P I E R S
1 London School of Economics
2 WeWork
3 Covington & Burling LLP
4 Saatchi & Saatchi
5 Framestore
6 Skype
7 Lastminute.com
8 Sainsbury’s
9 Lego
10 Bird & Bird
11 De Beers
12 Amazon
13 Deloitte
14 Goldman Sachs
15 Hachette
16 Unilever
17 Metro Bank
18 Merrill Lynch
19 AXA
20 London Stock Exchange
21 Ropes and Gray LLP
22 Lewis Silkin LLP
23 Nesta
24 Jones Day LLP
25 Gartner UK Limited
O N E F E T T E R L A N E
6
O N E F E T T E R L A N E O N E F E T T E R L A N E
8 9
L O C A L D E V E L O P M E N T S
MIDTOWN IS ONE OF LONDON’S MAJOR SUB-MARKETS AND HAS BEEN SUBJECT TO SIGNIFICANT DEVELOPMENT ACTIVITY IN RECENT YEARS, WITH A PIPELINE TO SUGGEST THIS WILL CONTINUE.
MIDTOWN HAS RECENTLY WITNESSED AN UNPRECEDENTED TREND OF TECHNOLOGY, MEDIA AND TELECOMMUNICATIONS (TMT) OCCUPIERS MOVING IN FROM LONDON’S TECHNOLOGY HUB SHOREDITCH AND CHOOSING TO OCCUPY HIGH QUALITY SPACE WITHIN THE AREA.
Farringdon WestHB Reavis
138,000 sq ft office development, with ground floor retail and amenity
accommodation2020
20 Farringdon StreetHB Reavis
86,000 sq ft multi-let office developmentCompleted
Fleet Street EstateCity of London Corporation
World class fraud and cybercrime court and new headquarters for the City of
London Police2025 (estimate)
28 Chancery LaneViridis
100,000 sq ft office and retail development. Framestore have let the
entire office accommodationCompleted
Charterhouse PlaceHelical Bar and Ashby Capital (2019)
165,000 sq ft office development, with 30,000 sq ft of ground floor retail
accommodation2021
Plumtree CourtNational Pension Service
827,000 sq ft development let to Goldman Sachs
Completed
Fleet House, New Bridge StreetCity of London Corporation
51,000 sq ft of new development comprising office and retail
accommodation 2022 (estimate)
Morley House HotelShiva Hotels / ICG Longbow120,000 sq ft 191-room hotel
development2021
Smithfield QuarterCity of London Corporation
270,000 sq ft redevelopment for the new site of the Museum of London
2022
Stonecutter CourtGreycoat/Ivanhoe Cambridge
240,000 sq ft of office and retail accommodation2022 (estimate)
Ludgate LondonGreycoat/Goldmans
105,000 sq ft refurbishment comprising office and retail accommodation
2020
17 Charterhouse StreetM&G Investments
145,000 sq ft office development, 27 residential apartments and 6,690 sq ft of warehouse office accommodation
let to De Beers2020
1 7
4 10
2 8
5 11
3 9
6 12
12 118 94 5 ONE67 2 1 103
O N E F E T T E R L A N E O N E F E T T E R L A N E
1 0 1 1
D E S C R I P T I O N
S P E C I F I C A T I O N
1 FETTER LANE WAS COMPLETED IN 1988 AND PROVIDES APPROXIMATELY 24,056 SQ FT (2,234.9 SQ M) OF OFFICE, RETAIL AND ANCILLARY ACCOMMODATION ARRANGED OVER LOWER GROUND, GROUND AND SIX UPPER FLOORS.
The office space, totalling 19,584 sq ft (1,819.4 sq m) including reception and BMA, offers an institutional specification which includes; raised floors, recessed fluorescent lighting, double glazing, suspended ceilings and VAV air conditioning.
The office floor plates range from 3,100 - 3,929 sq ft with the exception of the 6th floor which comprises 663 sq ft. The floors benefit from good natural light from all sides and generous floor to ceiling heights ranging from 2.4 - 2.65m throughout with slab to slab heights of 3.25m. The double height office reception fronts onto Fetter Lane and provides two lifts linking the ground to fifth floors.
The ground and lower ground floors benefit from prominent frontage to Fleet Street and Fetter Lane, experiencing high levels of footfall at the junction of these two major thoroughfares.
The current specification of the office space can be summarised as follows:
Substantial double height entrance hall
Generous finished floor to ceiling heights ranging from 2.4 - 2.65m throughout with slab to slab heights of 3.25m
Male and female WCs
VAV Air conditioning
Suspended Ceilings
Raised Floors
Two 10 person lifts providing access to the office space
O N E F E T T E R L A N E
1 0
O N E F E T T E R L A N E O N E F E T T E R L A N E
1 2 1 3
A C C O M M O D A T I O N F L O O R P L A N S
The property has been independently measured by Plowman Craven in accordance with the RICS Code of Measuring Practice and provides the following Net Internal Areas:
FLOOR USE NIA SQ FT NIA SQ M
6th Office 663 61.6
5th Office 3,114 289.3
4th Office 3,592 333.7
3rd Office 3,919 364.1
2nd Office 3,929 365.0
1st Office 3,525 327.5
Ground Retail 2,065 270.0
Ground Reception 473 43.9
Ground Office 356 33.1
Ground Storage 13 1.2
Lower Ground Retail 1,276 118.5
Lower Ground Ancillary 1,131 105.1
TOTAL 24,056 2,234.9
G R O U N D F L O O R
F I F T H F L O O R
S E C O N D F L O O R
S I X T H F L O O R
IPMS3 areas are available in the online dataroom.
O N E F E T T E R L A N E O N E F E T T E R L A N E
1 2 1 3
O N E F E T T E R L A N E
1 51 4
O N E F E T T E R L A N E
T E N U R E
T E N A N C Y
FREEHOLDThe Freehold boundary is shown edged red, for identification only, on the Ordnance Survey plan.
The Property is multi-let to one office tenant and four retail tenants producing a total rent of £1,199,000 per annum reflecting £49.84 per sq ft overall.
Locke Lord LLP took a lease over the whole of the office accommodation expiring 14 November 2019; they have sublet the entire space to Avanta Fetter Lane with a co-terminus lease expiry.
The total passing rent on the office accommodation is £920,000 per annum (£46.98 per sq ft).
The retail units are multi-let to four tenants; Tossed, Cards Galore, Smilepod and an independent sandwich shop producing a total passing rent of £279,000 per annum and a WAULT of 9.35 years to expiry.
TENANT ADDRESS FLOOR AREA (SQ FT)
ITZA (SQ FT)
LEASE START
LEASE EXPIRY
RENT REVIEW
RENT (£PA)
RENT (£PSF)
COMMENTS
Locke Lord (UK) LLP (sub-let to Avanta Fetter Lane)
1 Fetter Lane 1st-6th 18,742
29-Sep-13 14-Nov-19 - 920,000 46.98 The Avanta underlease is drawn outside the security provisions of the Landlord and Tenant Act 1954. The Locke Lord lease has been drawn inside the security provisions of 1954 Act.
Reception Ground 356
BMA Ground 473
Storage Ground 13
Smilepod Limited 176 Fleet Street Unit 1 1,332 56 1-Aug-16 31-Jul-26 1-Aug-21 47,500 35.66 The lease has been drawn inside the security provisions of the Landlord and Tenant Act 1954. The tenant is not in occupation.
Zest Food Limited (t/a Tossed) 176 Fleet Street Unit 2 2,065 730 26-Nov-13 25-Nov-28 26-Nov-2326-Nov-28 110,000 53.27
Parent company guarantee from Tossed Limited. The first 12 months following completion of the assignment dated 28 September 2018 to be at half rent. Reversionary lease signed from 26 November 2028 expiring 25 November 2033. The leases have been drawn outside the security of tenure provisions of the Landlord and Tenant Act 1954.
Maria Del Soccoro Rubiera Iglesias, Alfonso Rubiera Iglesias and Alberto Rubiera Iglesias
175 Fleet Street Unit 3 304 277 13-Feb-15 12-Feb-25 13-Feb-20 44,000 144.74 The lease has been drawn inside the security of tenure provisions of the Landlord and Tenant Act 1954.
Sweet Ventures Limited(t/a Cards Galore) 173 Fleet Street Unit 4 771 528 25-Dec-14 24-Dec-24 25-Dec-19 77,500 100.52 The lease has been drawn inside the security provisions of the Landlord and
Tenant Act 1954.
London Electricity Board 1 Fetter Lane Lower Ground 04-Nov-88 03-Nov-48 Transformer Chamber. Rent of 0.5p payable if demanded.
Accommodation Totals 24,056 1,199,000 49.84
FW
FWFW
FW
Def
FW
CW
Ward Bdy
W
TCB
Cycle H
ire Station
TCB
St D
unst
an's
Cou
rt
Falcon
Court
Pleydell C
t
BOU
VE
RIE
STR
EET
ARDING STREET
PLEYDELL STREET
FLEET STREET
LOM
BAR
D LAN
E
Johnsons Court
Red Lion C
ourt
Crane C
ou rt
OLD
MITR
E CO
UR
T
GOUGH SQ
ROWPEMBERTON
(St Mary's)
160
5 to 11
4 to 7
3
5
62
Building
10
mple Church
55
2021
3
Master's House
1
154
50
3
1
186
22 to
24
17
53
457
165
58
33
Museum
3
15
176
167 to 169
37
Clifford's Inn
180
1
6 to
8
186a
29
30 to 32
46
Francis Taylor
4
184
1
10
40 to 43
49
4
1
12
171
3
61
14 to 236
1 to 12
17
12
Mitre
19
Court
17
140
144
to 1
46
Hen and Chicken Ct
Chambers
4
1
73
5
8
60
PH
4
4 to
7
160a
2
2
2
Buildings
170
185
16
5657
138
Fetter Lane Apartments
QuantumHouse
44
47
Hare Place
1
1 to 2
Hotel
St Dunstan's
133
to 1
37House18
56
to
4
Embassyof the
Republicof Poland
Serjeants Inn
12
11
3
9
173
175
Mitre Court
The freehold title number is NGL757843.
Not to scale. For identification purposes only. This plan is based upon the Ordnance Survey Map with the sanction of the controller of H.M. Stationery Office. Crown Copyright reserved.
O N E F E T T E R L A N E
1 5
O N E F E T T E R L A N E
1 6
A S S E T M A N A G E M E N T R E F U R B I S H M E N T A N D E X T E N S I O N
TREHEARNE ARCHITECTS HAVE UNDERTAKEN A FEASIBILITY STUDY TO ASSESS THE REFURBISHMENT POTENTIAL OF 1 FETTER LANE, WHICH IS AVAILABLE IN THE ONLINE DATA ROOM.
The key proposed works for a refurbishment and extension of the existing building include the following;
Consolidation of the plant on the 6th floor;
Building out the existing 6th floor and creation of a communal roof terrace totalling 2,815 sq ft (261.5 sq m) on top of the existing building;
In-filling of terracing on the upper floors overlooking Crane Court to the rear of the property;
Creation of an additional 3,306 sq ft (307.1 sq m) of net lettable office area;
Conversion of the existing Building Manager’s Accommodation and Storage on the ground floor to bicycle storage and shower facilities, with access off Crane Court;
Removal of toilet cubicles on the upper office floors to extract additional net lettable area.
The table below shows the area gains proposed under Option 2 in the Feasibility Study which is available in the online dataroom.
FLOOR EXISTING NIA (SQ FT) PROPOSED NIA (SQ FT)
Office Retail Office Retail
Roof Terrace (2815)
6 663 3,367
5 3,114 3,515
4 3,592 3,913
3 3,919 3,913
2 3,929 3,913
1 3,525 3,913
Ground (Reception) 356 356
Ground (BMA) 473
Ground (Storage) 13
Ground (Retail) 2,065 2,065
Lower Ground 2,407 2,407
Total 19,584 4,472 22,890 4,472
Grand Total 24,056 27,362
CGI of proposed redevelopment
1 6
O N E F E T T E R L A N E O N E F E T T E R L A N E
1 7
O N E F E T T E R L A N E O N E F E T T E R L A N E
1 8 1 9
M A R K E T C O M M E N T A R Y
OCCUPATIONAL
F U R T H E R I N F O R M A T I O N
P R O P O S A L
C O N T A C T S
P L A N N I N GThe property is located in the City of London. It is not listed, but is situated within the Fleet Street Conservation Area.
OFFERS ARE SOUGHT IN EXCESS OF £21,000,000 FOR THE FREEHOLD INTEREST IN THE PROPERTY, SUBJECT TO CONTRACT AND EXCLUSIVE OF VAT.
THIS REFLECTS A NET INITIAL YIELD OF 5.35% AND A CAPITAL VALUE OF £873 PER SQ FT ON THE EXISTING AREA AND £767 PER SQ FT ON THE PROPOSED AREA, ASSUMING 6.75% PURCHASER’S COSTS.
APPLYING A YIELD OF 4.50% TO THE EXISTING RETAIL INCOME THIS PRICING EQUATES TO £776 PER SQ FT ON THE EXISTING OFFICE AREA AND £664 PER SQ FT ON THE PROPOSED OFFICE AREA.
Chris Room+44 (0)20 7588 4433
Marsha Rabinovich+44 (0) 20 7588 4433
Matt Millman+44 (0)20 7588 4433
Andrew Lister+44 (0)20 7588 4433
E P CThe property has an EPC rating of C. A copy of the certificate is available upon request.
V A TThe property is elected for VAT and VAT will therefore be payable on the purchase price. It is anticipated that the transaction will be treated as a Transfer of a Going Concern.
DISCLAIMER: Allsop LLP on its behalf and for the Vendors or Lessors of this property, whose Agents they are, give notice that: These particulars are set out as a general outline only for guidance to intending Purchasers or Lessees, and do not constitute any part of an offer or contract. Details are given without any responsibility and any intending Purchasers, Lessees or Third Parties should not rely on them as statements or representations of fact, but must satisfy themselves by inspection or otherwise as to the correctness of each of them. No person in the employment of Allsop LLP has any authority to make any representation or warranty whatsoever in relation to this property. Unless otherwise stated, all prices and rents are quoted exclusive of VAT. June 2019
D A T A R O O MFurther information can be found on the online data room. Please contact the vendor’s agents to request access.
The Midtown office leasing market remains one of Central London’s strongest performing sub-markets.
With a vacancy rate of less than 2.5% and availability of only 1.0m sqft at the start of 2019, prime rents in Midtown have remained relatively stable since mid-2017 at historic highs of around £75.00 per sq ft.
Some recent leasing transactions of note include the following:
INVESTMENTInvestor demand for Midtown assets remains strong, particularly from international investors, as exemplified by Korea’s National Pension Service’s £1.2bn acquisition of Goldman Sachs’ HQ at Plumtree Court in Q3 2018 which demonstrates the strong appetite for Midtown from both occupiers and investors.
Prime Midtown yields remain broadly in line with that of the City at 4.00% - 4.25% for best in class product.
Some recent vacant possession comparables in the Midtown and City markets include the following:
PROPERTY SIZE (SQ FT)
TENURE TENANCY PROFILE
ACHIEVED PRICE
(CAP VAL (£PSF)
PURCHASER
Paxton House, 30 Artillery Lane, E1 12,487 Freehold 0.5 years £11,100,000 £889 GMS Estates
12 Roger Street, WC1 17,798 Freehold 0.5 years £12,850,000 £722 Clearbell
1 Frying Pan Alley, E1 25,172 Freehold Vacant Possession £20,800,000 £826
Usbourne Publishing (Owner Occupier)
222 Bishopsgate, EC2 23,065 Freehold 1.1 years £21,100,000 £915 Private Hong Kong Investor
314-320 Grays Inn Road, WC1 20,410 Freehold Short term income £17,000,000 £833 Precis Holdings
PROPERTY SIZE (SQ FT)
TENANT TERM (BREAK)
RENT (£PSF)
DATE OF TRANSACTION
COMMENTS
20 Red Lion Court, WC1 3,067 Confidential 10 years £70.00 Q2 2019
The Bureau, 90 Fetter Lane, EC4 23,778 AB InBev 15 years £77.00 Q4 2018
Break-down as follows; 8th - £90 psf; 7th - £85 psf; 6th - £75 psf; 5th - £75 psf
20 Farringdon Street, EC4 7,110Berkeley
Partnership LLP
10 years £75.00 Q4 2018
Imperial House, 15-19 Kingsway, WC2 6,622 Playbuzz 5 years £74.00 Q2 2018
St Andrews House, 18-20 St Andrews Street, EC4 5,640 Thrings LLP 10 years £67.50 Q2 2018
1 8
O N E F E T T E R L A N E O N E F E T T E R L A N E
1 9
O N E F E T T E R L A N E
2 0