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OPALVILLAS

A FREEHOLD ESTATE COMPRISING AN INCOME PRODUCING SERVICED APARTMENT BLOCK AND TWO VACANT ADJOINING BUILDINGS WITH EXTENSIVE REFURBISHMENT / DEVELOPMENT POTENTIAL

167 NOTTE STREET, 6 WINSDOR VILLAS, LOCKYER STREET & THE FORMER COACH HOUSE, WINDSOR PLACE,

PLYMOUTH, DEVON PL1 2HF

A FREEHOLD ESTATE COMPRISING AN INCOME PRODUCING SERVICED APARTMENT BLOCK AND TWO VACANT ADJOINING BUILDINGS WITH EXTENSIVE REFURBISHMENT / DEVELOPMENT POTENTIALOPALVILLAS

Site outline for identification purposes only.

A374

A374

A374

B3240

B3240

HOE PARK

PLYMOUTH MARKET

RETAIL PARADE

PEDESTRIAN PRECINCT

FORMER CIVIC CENTRE (URBAN SPLASH)

WESTERN APPROACH CAR PARK

THEATRE ROYAL PLYMOUTH

PLYMOUTH PAVILIONS

KING POINT MARINA

TINSIDE LIDO

HOE PROMENADE

SMEATON’S TOWER

ROYAL WILLIAM YARD HARBOUR

DEVONPORT DOCKS

CROWNE PLAZA HOTEL

OPALVILLAS A FREEHOLD ESTATE COMPRISING AN INCOME PRODUCING SERVICED APARTMENT BLOCK AND TWO VACANT ADJOINING BUILDINGS WITH EXTENSIVE REFURBISHMENT / DEVELOPMENT POTENTIAL

INVESTMENT CONSIDERATIONS

Freehold

A prominent site extending to approximately 0.137 ha (0.338 acres) occupied by three adjoining buildings:

Opal Villas - A large fully operational serviced apartment building comprising 132 studio rooms (C1 use), 2 penthouse flats (C3 use), communal space, ancillary staff / service areas and undercroft parking

The Former Coach House - currently used as ancillary accommodation to Opal Villas but has potential for reconfiguration and provides additional secure gated parking within the rear courtyard for six cars

6 Windsor Villas – A listed vacant Victorian Villa requiring refurbishment. The building is currently configured to provide 23 bedsit / studio rooms and communal areas. The building is interconnected with Opal Villas

Overall Gross Internal Area (including common parts): 5,717.60 sq m (61,544 sq ft)

Opal Villas is an established serviced apartment scheme with regular occupier demand and limited competition within Plymouth

Opal Villas Income:

Studios let subject to licence agreements / penthouse flats let subject to ASTs

Projected 2018 / 2019 revenue of £771,588 per annum

Projected net operating income of £405,768 per annum

Opportunity to drive value through numerous asset management initiatives including redevelopment, refurbishment, change of use and driving operational efficiency

Plymouth city centre location within easy reach of HMNB Devonport dockyard

Offers are sought in excess of £4,500,000 (Four Million, Five Hundred Thousand Pounds) for the entire Freehold interest.

This price represents an attractive capital value of £73 per sq ft based upon the overall GIA (including common parts) of all three buildings.

Assuming a figure of £4,100,000 is apportioned to Opal Villas, a purchase at this level would reflect a gross initial yield of 18.82% based on the projected revenue for the current letting year and a net initial yield of 10.11% based on the average net operating income for the last three trading years, assuming purchasers costs of 6.54%.

Possibility to acquire UK Corporate entity resulting in further SDLT savings

LOCATIONPlymouth, which has a population of c. 264,000, is located on the south coast of Devon, approximately 60 km (37 miles) south west of Exeter and 348 km (216 miles) south west of London. It is a major regional commercial centre and provides one of the UK’s key shipping ports.

The city has undergone significant urban redevelopment since 2003, under the project launched by Barcelona-based architect, David Mackay’s ‘Vision for Plymouth’. Through the support of Plymouth City Council and the Plymouth Chamber of Commerce, the project facilitate the development of shopping centres, a cruise terminal and boulevard, and to support population growth to 300,000 by 2020.

Today Plymouth’s main dockyard, HMNB Devonport, is the UKs key naval base UKs in Western Europe. The vast site located approximately 3.2km (2 miles) to the west of the city centre covers more than 650 acres and has 15 dry docks, four miles of waterfront,

25 tidal berths and five basins. The base directly employs 2,500 Service personnel and civilians, supports around 400 local firms and generates around ten per cent of Plymouth’s income.

The city also benefits from a large student population of in excess of 35,000 students spread across four main educational institutions - The University of Plymouth, City College Plymouth, Plymouth Marjon University and Plymouth College of Art.

The University of Plymouth is the city’s largest University and registers a student population of over 21,000 and was rated as one of the Top 30 universities in the 2018 Whatuni Student Choice Awards (rank 23rd). It has two main campuses, “Campus” is in the city centre, and “North Campus” is 4 miles north of this close to Derrifod Hospital. The University made a joint venture with the University of Exeter in 2000 to form Peninsula College of Medicine and Dentistry.

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MANCHESTER●LIVERPOOL

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WEYMOUTH●

POOLE●

NORWICH●

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PLYMOUTHPLYMOUTHPLYMOUTH

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A361

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SITUATIONThe property occupies a prominent position on the south side of Notte Street at its junctions with Lockyer Street and Windsor Place. The property is situated approximately 500m from the city centre, where an array of shops including the Drake Circus Shopping Centre, supermarkets, restaurants and leisure amenities are located. Hoe Park is to the south with a number of cultural destinations close by including Viking Stone, The Merchant House Museum and Theatre Royal Plymouth. A Tesco Express is located within 100m of the property.

Plymouth benefits from excellent transport communications with the A38 dual-carriageway connecting the city with the M5 motorway to Exeter to the east and Cornwall to the West.

Plymouth Railway Station provides regular direct services to Exeter (55 minutes), Bristol (1 hour 58 minutes) and London Paddington (3 hours 11 minutes).

In addition, various bus routes (5, 21, 21A & 34) serve the area. Devonport Dockyard can be reached within a journey time of approximately 20 minutes from the subject property.

Plymouth City Airport is located 6km (4 miles) north of the city centre providing flights to a number of UK and European destinations.

PLYMOUTHSTATION

DEVONPORT

DOCKYARD

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PLYMOUTH COACH STATION

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CENTRE

SUTTONHARBOUR

KING POINTMARINA

DEVONPORTDOCKS

HMNB DEVONPORT DOCKYARD

ROYAL WILLIAM YARD

ROYAL WILLIAM YARD HARBOUR

CREMYLLFERRY

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LIPSON VALE

LIPSON

DEVONPORT

MORICE TOWN

STOKE VILLAGE

STOKE

KEYHAM

DEVONPORT

MILLBAY

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A374

A379

A386

A386

A386

B3250

B3396

B3396

A3064

B3396

B3250

B3238

B3240

B3214


© Crown Copyright, ES 100004106. For identification purposes only.

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Opal Villas

Opal Villas, 167 Notte Street, Plymouth PL1 2HF

Ordnance Survey © Crown Copyright 2018. All rights reserved. Licence number 100022432. Plotted Scale - 1:1250

1

23

OPAL VILLAS & THE FORMER COACH HOUSE


DESCRIPTION The Freehold site is occupied by three adjoining buildings and covers an area of 0.137 ha (0.338 acres), which can be broken down as follows:

1. OPAL VILLAS

Opal Villas fronts Notte Street and is the principle building on the site. It is arranged over basement, lower ground car park level, raised ground and eight upper floors. The building is currently configured to provide 132 self-contained studios and two self-contained penthouse flats (1 x 1 bedroom & 1 x 4 bedroom).

Opal Villas, which is of reinforced concrete construction, was originally built as offices in c. 1964, before being converted into Student Accommodation in c. 1999 with a C3 residential use over the penthouse flats. The student element of the building has however been used as Serviced Apartment Accommodation since at least 2007 and received a Certificate of Lawfulness in December 2017.

At ground floor level there is a reception, large common room, staff welfare and offices. A laundry room is also provided.

The lower ground floor car park has 13 parking spaces (11 for cars and two for motorcycles) and includes a turntable. In addition there are two external off street parking spaces to the side of the property on Lockyer Street.

There are several storage and plant rooms within the car park level and a further basement level.

The building benefits from a central core staircase accessing the raised ground and upper floors and two main passenger lifts which serve the raised ground to seventh floors. One lift is regularly serviced whilst the other lift is no longer operating. In addition, there is a goods lift, which provides direct access from the lower ground floor car park and staff offices, into the large penthouse flat.

CCTV operates within the common parts and the building benefits from a regularly serviced fire alarm system and secure entry systems. The building is staffed 12 hours a day and there is an emergency overnight call system in place.

The building is internally linked with 6 Windsor Villas at ground floor level but access has currently been sealed off.

The overall Gross Internal Area of the building (including common parts) is approximately 4,972.9 sq m (53,528 sq ft).

A Schedule of Accommodation and floors plans are provided within the data room.

TYPICAL FLOOR LAYOUT - GROUND FLOOR


ACCOMMODATION SCHEDULE

Unit Type Average GIA No of

Sq m Sq Ft Units

Studio (C1)

Small 14.0 150.3 5

Small Standard 13.6 146.5 16

Small Balcony 14.3 153.6 3

Small Deluxe 15.6 167.9 1

Medium 16.1 173.6 73

Large Standard 22.2 239.2 15

Large Balcony 23.9 256.9 11

Large Balcony Deluxe 25.7 277.1 7

Large Twin 22.9 246.5 1

Flat (C3)Small Penthouse (1 bed) 25.9 278.8 1

Large Penthouse (4 bed) 87.0 936.5 1

Total 134

All studios are all self-contained and benefit from an en-suite shower room with an electric shower, WC and basin. Each studio has a kitchenette area which includes a cupboard(s), sink, electric hob, microwave, toaster, kettle and fridge (with freezer draw). The majority of studios also benefit from having a double wardrobe, whilst every studio has a small cupboard for clothing, desk / eating area and shelving.

Hot water is provided via individual on demand electric 10L water heaters within each studio and heating is provided by electric panel heaters. Each studio benefits from a digital TV and telephone socket. Free wifi broadband is supplied to residents in the ground floor communal areas only. Residents who required broadband in their rooms have to arrange for this to be provided via the BT Landline and choose a provider.

Residents pay for electrical costs (including hot water and heating costs) on a pay as you go basis via top up metres fitted within each studio.

Several studios have the benefit of a balcony.

A selection of internal photographs illustrating the typical condition of the various studio types are provided in the data room.

n Opal Villas n Windsor House n Coach House

THE FORMER COACH HOUSE

6 WINDSOR VILLAS


2. THE FORMER COACH HOUSE

Accessed via Windsor Place the property is arranged over ground floor and requires complete modernisation. There is additional secure parking provided at the rear of the building in the courtyard for up to six cars. Two spaces are currently used by staff at Opal Villas and four are let to occupants.

The overall Gross Internal Area of this is approximately 49.8 sq m (536 sq ft).

This building offers extensive potential for refurbishment / reconfiguration and could be used to provide an additional lettable accommodation or a staff office in connection with Opal Villas.

3. 6 WINDSOR VILLAS

6 Windsor Villas is Grade II Listed Victorian Villa, which is currently vacant. Historically the building was used as an office building, more recently as residential / student accommodation. The building is currently configured to provide circa 21 bedsit / studio rooms with additional bathroom and kitchen facilities. The property requires complete refurbishment. The building is linked to Opal Villas at ground floor level but access is currently sealed off.

To the front of the building there is off street parking for eight cars. These spaces are currently let to residents of Opal Villas.

The overall Gross Internal Area of the building (including common parts) is approximately 694.9 sq m (7,480 sq ft).

This building affords potential to be integrated into the Opal Villas serviced apartment operation. In addition, the building could also be redeveloped and reconfigured to provide Offices or C3 residential accommodation (flats), subject to obtaining all necessary consents.

It should be noted that the adjoining villa, No.5 Windsor Villas, is currently used as an office building, whilst No.4 Windsor Villas is configured to provide 6 self contained flats.

Floor plans are available in the dataroom.

TENANCIESThe studios within Opal Villas are let subject to Licence Agreements, whilst the penthouse flats are let subject to Assured Shorthold Tenancies (AST’s), copies of which are available in the dataroom.

6 Windsor Villas and The Former Coach House are being sold with vacant possession.


INCOME Based on Opal Villas’ average performance over the last three trading periods it is projected that Opal Villas will generate a revenue of £771,588 per annum for the October 2018 / September 2019 trading year. This is after allowances for voids and rebooker discounts to the standard letting rates have been applied. This figure also includes sundry income derived from laundry and parking charges. (see table below)

Standard weekly rental levels for the studios range between £100 to £150 per week depending on the size and room type. Rents are inclusive of water costs and a business rate contribution, whilst electrical costs are paid for directly by occupants.

The budgeted operating expenditure (Opex) for October 2018 / September 2019 is approximately £365,820; this includes management, maintenance, business rates, council tax, security and utilities. It should be noted that this Opex figure is higher than the average Opex figure for the last three trading periods (£330,110) and has increased mainly due to an increase in utility charges. It is anticipated that utility costs will be reduced in future trading periods and therefore bring the Opex figure back into alignment with the three year average.

The projected Net Operating Income (NOI) for the October 2018 / September 2019 letting year is approximately £405,768 per annum.

OCTOBER 2018 - SEPTEMBER 2019 SUMMARY PROJECTED NET INCOME SCHEDULE Unit Type No of

unitsTypical Standard

Weekly RentTotal

(Per Annum)

Studio (C1)

Small No wardrobe 5 £100 £26,000

Small Standard 16 £105 £88,400

Small Balcony 3 £115 £17,940

Small Deluxe 1 £105 £5,460

Medium Standard 73 £125 £474,500

Large Standard 15 £130 £101,660

Large Balcony 11 £135 £77,220

Large Balcony Deluxe 7 £140 £50,700

Large Twin 1 £150 £7,800

Flat (C3)* Small Penthouse (1 bed) 1 £144 £7,500

Large Penthouse (4 bed) 1 £242 £12,600

Gross Potential Income (if fully let) £869,780

Less Discounts & Incentives -£77,444

Voids -£52,052

Residential Income £740,284

Sundry Income £31,304

Revenue £771,588

Less Budgeted Operating Expenditure (Opex) -£365,820

Projected Net Operating Income (NOI) £405,768

*Let monthly (Penthouse tenants pay for all bills and council tax)

DEMAND FOR SERVICED APARTMENTS ACCOMMODATION AT OPAL VILLAS Opal Villas has been operated as a Serviced Apartment building since 2004. Since 2015 an average occupancy rate of 93% has been achieved.

The building is currently positioned in the market to provide affordable studio accommodation.

The majority of residents are skilled dock workers who are drawn to this type of affordable accommodation and particularly favour its accessibility to HMNB Devonport dockyard.

The dock workers who stay at the property predominantly work for Badcock International who currently employ approximately 5,000 people in Davenport docks and throughout Plymouth. The building is also popular with people who work for Princess Yachts.

The building is also in demand from construction workers.

TUPEThe employment contracts relating to a number of current employees will form part of the sale, and the responsibility for these contracts will pass to the purchaser at completion by virtue of TUPE regulations. Summary details have been provided in the data room.

The following performance statistics have been achieved at Opal Villas during the last three trading periods:

Gross to Net Operating Costs (last three years)

15/16 16/17 17/18 Average

Revenue £763,838 £778,179 £772,748 £771,588

Opex £355,393 £322,894 £312,045 £330,110

NOI £408,455 £455,285 £460,703 £441,478

NOI Margin 53% 59% 60% 57%

Occupancy Rate* 99% 90% 90% 93%

*Figures based on percentage of Gross Potential Income achieved with Voids deducted for each period.

Please refer to the data room where financial statements for the last three trading periods have been provided together with the Opex Budget for October 2018 / September 2019.


ASSET MANAGEMENT OPPORTUNITIES

The following short to medium term asset management initiatives provide opportunities to add value:

Fully refurbish the asset and drive rental income

Remove re-letting discount and achieve full income potential

Management efficiencies created to reduce current gross to net running costs

Reduce void and turn around period to drive NOI

Provision of WiFi broadband internet throughout the building

Creation of an online letting platform to enhance accessibility in the wider market

Alternative use potential for Opal Villas including C3 residential and hostel (subject to planning) or as a hotel (within it’s current C1 use class), taking advantage of the property’s sea views and close proximity to Hoe Park

Complete redevelopment of the entire site for multiple uses including C3 flats and B1 offices (Subject to Planning)

Refurbishment of Windsor House to provide additional serviced apartment accommodation linked to Opal Villas (subject to planning)

Change of use of Windsor House to Offices / Residential scheme (subject to obtaining all necessary consents)

Refurbishment of The Former Coach House to provide additional accommodation

Increase summer income by targeting tourists during the peak holiday season

ASKING PRICEOffers are sought in excess of £4,500,000 (Four Million, Five Hundred Thousand Pounds) for the entire Freehold, subject to the existing tenancies / licences, subject to contract and exclusive of VAT.

This price represents an attractive capital value of £73 per sq ft based upon the overall GIA of all three buildings.

Assuming a figure of £4,100,000 is apportioned to Opal Villas, a purchase at this level would reflect a gross initial yield of 18.82% based on the projected revenue for the current letting year and a net initial yield of 10.11% based on the average net operating income for the last three trading years, assuming purchasers costs of 6.54%.

Possibility to acquire UK Corporate entity resulting in further SDLT savings

Misrepresentation Act: 1. Allsop LLP on its own behalf and on behalf of the vendor/lessor of this property whose agent Allsop LLP is, gives notice that: (a) these particulars do not constitute in whole or in part an offer or contract for sale or lease; (b) none of the statements contained in these particulars as to the property are to be relied on as statements or representations of fact; and (c) the vendor/lessor does not make or give, and neither Allsop LLP nor any of its members or any person in its employment has any authority to make or give, any representation or warranty whatsoever in relation to the property. The only representations, warranties, undertakings and contractual obligations to be given or undertaken by the vendor/lessor are those contained and expressly referred to in the written contract for sale or agreement for lease between the vendor/lessor and a purchaser or tenant. 2. Prospective purchasers or tenants are strongly advised to: (a) satisfy themselves as to the correctness of each statement contained in these particulars; (b) inspect the property and the neighbouring area; (c) ensure that any items expressed to be included are available and in working order; (d) arrange a full structural (and where appropriate environmental) survey of the property; and (e) carry out all necessary searches and enquiries. Allsop is the trading name of Allsop LLP. Design CommandD www.commandHQ.co.uk 12.18

Adam Kerven020 7344 [email protected]

For further information or to make arrangements for viewing please contact:

Victoria Barron020 7344 [email protected]

James Hood020 7344 [email protected]

William Shoebotham020 7344 [email protected] www.allsop.co.uk

PLANNINGLocal Planning Authority Plymouth City Council 01752 668000

www.plymouth.gov.uk

The properties do not fall within a conservation area, but 6 Windsor Villas is Grade II Listed.

There have been a number of planning applications involving the use of the buildings. Key applications include:

Opal Villas: Planning was granted on 27th October 2017 (Ref No: 17/02054/EXUS) for the change of use from sui generis student accommodation to C1 serviced apartments and residential (C3) use:

‘Establish a mixed use comprising 132 serviced apartments (Class C1) and two flats (Class C3).’

6 Windsor Villas: Planning was granted on 16th March 2000 (Ref 00/00278/FUL) for the change of use from B1 office accommodation to student accommodation, as part of a larger application including Phoenix House (now called Opal Villas).

‘Change of use of premises, including 6 Windsor Villas, to part residential accommodation for students and two wardens and part hostel accommodation for companies' staff.’

ENERGY PERFORMANCE CERTIFICATESThe EPCs are available in the data room.

VATThe properties are not elected for VAT.

FURTHER INFORMATIONAccess to a data room containing full property / legal information is available upon request.

Documents will include:

EPCs

Financial Statements (last three trading periods)

Opex Budget (current trading period)

Floor Plans

Photos

Planning documents

Health & Safety Reports

TUPE documents

Current Accommodation and Tenancy Schedule

Lift Service Agreement

Sample AST

Sample Licence agreement

Local Authority Searches

Title documents

Gas & Electrical Certificates