london urban logistics - levy real estate...(darenth interchange) of the m25, approximately 15 miles...

LONDONURBANLOGISTICS INVESTMENT

24–50 OSSORY ROAD BERMONDSEY LONDON SE1 5AN

DRAF T

2

24–50 OSSORY ROAD • BERMONDSEY • LONDON • SE1 5AN LONDON URBAN LOGISTICS

DRAF T

3


SUMMARY

• A rare opportunity to acquire an ultra-prime modern single let trade counter/industrial warehouse in a central London location.

• Well located in the London Borough of Southwark, approximately 3 miles south of Central London.

• Conveniently located c. 0.9 miles from South Bermondsey Railway Station and 1.5 miles to Elephant & Castle Underground and National Rail stations (Northern Line & Bakerloo Line and Thameslink).

• The premises is configured as two industrial units utilised by a single tenant, totalling 22,991 sq ft GIA.

• The site is fully let to Rexel UK Limited, representing a ‘minimum risk of business failure (4A1).

• Currently producing a very low passing rent of £307,800 per annum equating to £13.39 per sq ft.

• Estimated Rental Value in excess of £20 per sq ft in its current layout. Opportunity for further growth subject to reconfiguration into two industrial units.

• 1.5 years to first break and 9.5 years to expiry.

• Freehold.

• Potential residential redevelopment opportunity, subject to obtaining consents.

We are instructed to seek offers in excess of £8,875,000 (Eight Million, Eight Hundred and Seventy Five Thousand Pounds) subject to contract and exclusive of VAT, which reflects a capital value of £386 per sq ft and a Net Initial Yield of 3.25%, assuming purchaser’s costs of 6.68%.

DRAF T

4


LOCATION

Bermondsey is a densely populated south-eastern suburb of Central London, located within the Borough of Southwark. The property lies in a mixed-use area and is located just 3 miles south of Central London.

Ossory Road is located just off the A2 (Old Kent Road). The area benefits from excellent transport links to both the City, West End and to the south. The Old Kent Road also provides direct access to Junction 2 (Darenth Interchange) of the M25, approximately 15 miles to the east, while the London Docklands and London City Airport is some 3 miles to the north.

A2

Ossory Road

A3

A3

A2

A2

A2

A24

A23

A11

A13

A205

A205

A205

A501

A1020

MARYLEBONE

CLARKENWELL

POPLARMAYFAIR

CAMBERWELL

DULWICH

Blackheath

Regents Park

Hyde Park

Green Park St James’s

Park

Battersea Park

ClaphamCommon

BrockwellPark

Peckham RyePark & Common

BurgessPark

PECKHAM

LAMBETHVICTORIABELGRAVIA

WEST END

CITY OFLONDON

CANARYWHARF

London City Airport

WOOLWICH

HERNE HILL

BATTERSEA

CLAPHAM

PIMLICO

R

I VE R T H A M E S

VictoriaElephant & Castle

Canada Water

South Bermondsey

Queens Road Peckham

Nunhead

New Cross

Denmark Hill

BrockleyClaphamJunction

Stockwell

Oval

GLE

NG

ALL R

OA

D

B215 B

215

OS

SO

RY

RO

AD

OL

MA

R S

T.

A22

08

A2

A2

BIANCA RD.

LATONA RD.

24-50 Ossory Road

SITUATION

24-50 Ossory Road is accessed directly off the A2 (Old Kent Road), approximately 100m to the north.

Ossory Road is superbly located for companies serving Central London as well as the South London boroughs. Nearby occupiers include Shurgard Self Storage, Damien Hirst Studios, Tesco, Asda, B&Q, Halfords, Currys PC World, Edmundson Electrical, Plumb Center, Selco Builders Warehouse, B&M and Southern Wood Retail Park where traders include Argos, DFS, Ocado and Maplin.

South Bermondsey railway station is under a mile away and provides a direct service to London Bridge (5 minutes), while both Elephant & Castle stations (Northern & Bakerloo lines and National Rail) are within walking distance. In addition, the subject premises is approximately 750m from the proposed Burgess Park Old Kent Road 1 Bakerloo Line station (at the junction with Dunton Road) and approximately 1km from the prospective Asylum Old Kent Road 2 Bakerloo Line station (at the junction with Asylum Road). Frequent bus services on the Old Kent Road provide frequent access towards Elephant & Castle and Central London (53, 172 and 453 routes).

PROPOSED BAKERLOO LINE EXTENSION

OSSORY ROAD

DRAF T

5


DESCRIPTION

The property comprises two modern industrial units combined which are utilised as a single warehouse, totalling 22,991 sq ft GIA. Specifications include:

• Portal steel frame construction

• High-quality first floor offices in both units

• Trade counter

• Three level access roller shutter loading doors

• Concrete surfaced secured yard

• 60% site coverage

• 6.0m eaves height

ACCOMMODATION

Unit sq ft sq m1 13,879 1,289.442 9,111 846.48

Total 22,991 2,135.93

SITE

The site occupies an area of approximately 0.36 hectares (c. 0.88 acres) which represents a site cover of approximately 60%. The red line site boundary is shown for illustration purposes.

CURRENT USE

Use Class B8 – Storage & Distribution with ancillary trade counter.

TENURE

Freehold.

Centre

GlengallBusiness

Works

5213

1

El Sub Sta

4

OSSO

RY RO

AD

Line Of Posts

ESS

24-50

DRAF T

6


TENANCY

The property is let to Rexel UK Limited (00434724), Previously Hagemeyer (UK) Ltd on fully repairing and insuring terms for a period of 25 years from 4th May 2004 expiring on 3rd May 2029.

The current passing rent of £307,800 per annum, reflects a low rent of £13.39 per sq ft.

The lease is subject to 5 yearly rent reviews, the next being 25 March 2021, and the final being 25 March 2026.

The tenant is entitled to early determination on 31 March 2021, or on 31 March in any subsequent year by not less than six months’ notice.

COVENANT INFORMATION

Rexel UK was established in 1947 and specialises in the distribution of electrical supplies to professional users and distributes products and services in the areas of automation, technical supply and energy management. The Rexel Group is headquartered in France and has 2,000 sales outlets across 32 countries and 27,000 employees.

Rexel UK Limited has a Dun & Bradstreet rating of 4A 1 representing a ‘minimum risk’ of business failure.

The company recorded the following accounts over the last 3 years:

Rexel UK Limited 31 Dec 2018 31 Dec 2017 31 Dec 2016

Sales Turnover £707,247,000 £739,632,000 £765,011,000

Profit/(Loss) before Taxes (£4,441,000) £9,530,000 (£1,826,000)

Shareholder’s Funds £76,458,000 £57,116,000 £43,995,000

Net Current Assets (Liabilities) £91,740,000 £99,281,000 £63,936,000

DRAF T

7


INVESTMENT MARKET

Date Property Size (sq ft)

Term Certain (Years)

Capital Value

Capital Value (PSF)

Net Initial Yield

Sep-19 Sergeants Industrial Estate, Wandsworth 51,958 2.2 £28.15 £542 2.3%

Sep-19 B&M, 593-613 Old Kent Road, Bermondsey 13,595 6.0 £10.25m £754 2.41%

Feb-19 Matthew Clark, Central Way, Park Royal 78,619 4.0 £34.5m £439 3.23%

Jan-19 Metropolitan Police, 25-33 Parkhouse Street, Camberwell 15,634 0.5 £8.5m £544 N/a

Oct-18 14-18 Verney Road, Bermondsey 22,224 9.0 £12.0m £540 3.00%

May-18 2-10 Ossory Road, Bermondsey 10,667 Vacant £5.5m £515 N/a

May-18 The Gate Centre, Syon Gate Way, Great West Road, Brentford 82,419 5.5 £34.3m £416 3.15%

Mar-18 Units 1-3, 15 Havelock Terrace, Battersea 16,347 4.1 £8.569m £524 3.20%

Feb-18 Units 1-4, 221 New Kent Road, Bermondsey 14,587 Vacant £6.6m £452 N/a

Sep-17 Zennor Road Industrial Estate, Balham 67,001 3.0 £30.015m £448 2.89%

OCCUPATIONAL MARKET - PRIME INDUSTRIAL RENTS

4

5

M25A232

A222

A205

A224

A233A22

A23

A20

A21

A21

A2

Bromley

Croydon

London City Airport

Mitcham

Victoria

Sutton

Greenwich

Forest Hill

Dulwich Village

West Norwood

Crystal Palace

West End City of London

Wandsworth

£24.00

Battersea

£30.00

Canning Town

£25.00

Bermondsey

£24.00

Brixton

£27.00

Vauxhall

£28.00

Wimbledon

£18.50

24–50 OSSORY ROAD

Tenant Address Date Area (sq ft)

Rent (psf)

Term Certain

Confidential Unit 13 Ellersie Square, London SW2 U/O 18,574 £18.60 5 Years

SMS Network Ltd

Unit 2 Admiral Hyson Industrial Estate, London SE16 Aug-19 5,294 £20.00 2 Years

Dulux Unit 2 Bermondsey Trading Estate, London SE16 Dec-18 5,146 £23.03 5 Years

TLC Electrical Distributors

Unit 1, Chiltonian Industrial Estate, London, SE12 Dec-18 7,000 £18.50 10 Years

Amazon Units 1 -2, Zennor Trade Park, London SW12 Sep-17 4,412 £23.00 3 Years

TLC Electrical Distributors

Unit C4 Six Bridges Trading Estate, London SE1 Sep-17 5,316 £18.00 5 Years

Souvenir Scenic Studios Ltd

Units 60 - 62, T-Marchant Industrial estate, London, SE16 Jul-17 12,339 £18.00 5 Years

DPD UK Unit 5 Mandela Way, London SE1 Feb-17 14,888 £17.50 4 Years

Prime rents in South East London achieved at £24 psf

Very low passing rent of £13.39 psf

5% forecast London industrial rental growth in next 12 months

Industrial stock diminishing leading to increased value

Ideal ‘Last Mile’ location

DRAF T

8


RESIDENTIAL OPPORTUNITY

The subject premises is located within the OKR10 area of the Old Kent Road Area Action Plan, an ‘Opportunity Area’, as designated by the Mayor of London through the London Plan. There is significant regeneration activity proposed for the ‘Old Kent Road Opportunity Area’, as part of the Old Kent Road Area Action Plan (December 2017), including the delivery of 20,000 new homes and 10,000 new jobs by 2037. The site currently has a PTAL of 3 on a scale of 1-6b where 6b is the highest. A PTAL Rating of 3 denotes a ‘Moderate’ level of public transport accessibility.

An indicative feasibility study has been drawn up by architects Broadway Malyan which has received a positive response from the London Borough of Southwark.

The scheme provides 138 residential units over 10 storeys with 2170 sq m (23,360 sq ft) of industrial accommodation situated at ground floor level.

The unit mix provides 9 studios, 63 1-beds, 47 2-beds and 19 3-beds of which 45 units are designated affordable.

For further information in respect of the residential development opportunity please contact the Levy Real Estate residential team.

Kit Haig

D 020 7747 0111

M +44 7854 963 145

[email protected]

DRAF T

9


EPC

TBC.

DATA SITE

Access to the data site will be granted upon request.

SALE

The asset is currently held in a SPV company. It is the vendors preference to sell 100% of the shares in this SPV.

Further information is available upon request.

FURTHER INFORMATION

To arrange an inspection, please contact:

Simon HigginsD +44 (0) 20 7747 0130

M +44 7976 266 [email protected]

Gavin QuinnD +44 (0) 20 7747 0121M +44 7879 408 035

[email protected]

Jeremy GrundyD +44 (0) 20 7747 0131

M +44 7973 667 [email protected]

Will EdgleyD +44 (0) 20 7747 0120

M +44 7748 286 333 [email protected]

INDUSTRIAL INVESTMENT

Messrs Levy Real Estate, for themselves and for the vendors of this property whose agents they are, give notice that: (i) the particulars are set out as a general outline only for the guidance of intending purchasers, and do not constitute, nor constitute part of, an offer or contract: (ii) all description, dimensions, references to condition and necessary permission for use and occupation and other details are given in good faith and are believed to be correct, but any intending purchasers should not rely on them as statements of representations of fact and must satisfy themselves by inspection or otherwise as to the correctness of each of them: (iii) no person in the employment of Levy Real Estate has any authority to make or give any representation of warranty in relation to this property. November 2019.

PROPOSAL

We are instructed to seek offers in excess of £8,875,000 (Eight Million, Eight Hundred and Seventy Five Thousand Pounds) subject to contract and exclusive of VAT, which reflects a capital value of £386 per sq ft and a Net Initial Yield of 3.25%, assuming purchaser’s costs of 6.68%. DRAF T

london urban logistics - levy real estate...(darenth interchange) of the m25, approximately 15 miles...

Documents