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34 -36 High Street, WELLINGTON TA21 8RD
DOMINANT, WELL-LET SUPERMARKET INVESTMENT with fixed rental uplift
34 -36 High Street, WELLINGTON TA21 8RD
Investment Summary
•
Wellington is an attractive market town lying on the A38 trunk
road in Somerset, seven miles south west of Taunton. It has an
affluent catchment area estimated at circa 38,000 people and
a growing population, with 2,500 new dwellings proposed.
•
Comprising the town’s dominant foodstore, prominently
situated in an accessible town centre location, with access
points from both Wellington High Street and Scott’s Lane.
•
22,799 sq ft foodstore, with 156 car parking spaces
(1:146 sq ft), considered by Waitrose to be an optimum size
for their current requirements in such catchments.
•
Freehold.
•
Let to the 5A1 covenant of Waitrose Limited with over 12.5
years unexpired.
•
Passing rent of £412,964 per annum, reflecting £18.11 per sq ft.
•
Fixed 2.5% pa compound uplift at review in March 2019 which
will increase the income to £467,231 pa.
•
Our client is seeking offers in excess of £7,375,000 (Seven
Million, Three Hundred and Seventy Five Thousand Pounds),
subject to contract and exclusive of VAT. A purchase at this level
would provide an attractive 5.25% Net Initial Yield, with a
reversion to 5.94% in March 2019, assuming 6.66% purchase
costs. The Equivalent Yield is in the order of 5.8%.
DOMINANT, WELL-LET SUPERMARKET INVESTMENT
Total rental income of £412,964 per annum
34 -36 High Street, WELLINGTON TA21 8RD
Halse
B3227
A358
B3227
A3038
Milverton
Oake
Bishop’s
Hull
Hillfarance
TAUNTON
Rumwell
Langford
Budville
Bradfordon-Tone
Nynehead
B3170
A38
Trull
Runnington
Tonedale
Thorne St
Margaret
Rockwell
Green
B3187
A38
Wellington
Wellingto
Wellingt
Welling
Wellin
Welli
Well
Wel
We
West
Buckland
26
Location
Poundisford
M5
Wellington is an attractive, prosperous market town in Somerset in the south west of
England. The town falls under the borough of Taunton Dean and is located 23 miles north
east of Exeter, 43 miles south west of Bristol and 7 miles to the south west of Taunton.
Corfe
A38
B3170
Sampford
Arundel
A38
M5
Blagdon
Hill
Wrangway
Wellington benefits from good road communications, being 1.24 miles from Junction 26 of
the M5 motorway, and is linked to Taunton via the A38 Trunk Road.
M5
Nicholashayne
Clayhidon
Culm Davy
Culmstock
The town is also well served by the national rail network, with Taunton Railway Station located
6 miles to the north east, providing a fastest journey time to London Paddington of 1 hour 42
minutes. Tiverton Parkway railway station is located about 7 miles to the south west.
Burnworthy
Churchstanton
B3170
B3391
Churchinford
DOMINANT, WELL-LET SUPERMARKET INVESTMENT
Wellington is within easy travelling distance of two international airports, Exeter International
Airport 19 miles to the south west and Bristol Airport, 36 miles to the north east.
Otterford
The town has an established manufacturing base, including aerosol and bed-making
factories. Other notable institutions include Wellington School and the Wellington Museum.
The town centre also benefits from a boutique cinema, The Wellesley, built in Art Deco style
in 1937 but benefitting from state of the art digital/3D technology and a fully licensed bar.
Wellington is an attractive, prosperous market town in Somerset
34 -36 High Street, WELLINGTON TA21 8RD
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156 spaces
NORTH STREET
Situation
The property is situated just off High Street in the heart of Wellington town
centre, with two access points from High Street and Scott’s Lane.
The immediate area includes predominantly residential and high street
retail accommodation, with High Street providing an attractive mix
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of independent and national retailers including Costa Coffee, Boots,
WHSmith, Superdrug and Greggs.
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DOMINANT, WELL-LET SUPERMARKET INVESTMENT
The property is prominently situated on Wellington High Street
34 -36 High Street, WELLINGTON TA21 8RD
Catchment & Demographics
Wellington has a sizeable, relatively affluent catchment population of approximately
38,000 people within a 15 minute drive time, drawn from a number of surrounding
villages (CACI). In addition, Taunton Deane Borough Council has identified
Wellington as a focus for new housing, with the allocation of 2,500 new dwellings,
of which a proportion are currently under construction.
The CACI Acorn report for the catchment indicates higher than average
representation in the affluent achiever, comfortable community, mature money,
asset rich families, successful suburbs (of Taunton) and wealthy countryside
commuter categories.
In particular, Comfortable Communities comprise 35% of the catchment and Affluent
Achievers 26.2%, against national averages of 26.2% and 22.8% respectively.
Foodstore Competition
Waitrose is the dominant foodstore in Wellington, with a smaller Asda (17,991 sq ft)
and small Co-operative Food (9,367 sq ft ). The local catchment is relatively captive
and Waitrose confirm the store is a solid trader.
The nearest Waitrose store is in Crewkerne, 26.2 miles to the south east of the
subject property. (See Investment Comparables section).
DOMINANT, WELL-LET SUPERMARKET INVESTMENT
Waitrose is the dominant foodstore in Wellington
34 -36 High Street, WELLINGTON TA21 8RD
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Waitrose report that the property is an optimum size for their current requirements in such catchments.
The rent review clause stipulates that the floor areas are as follows:
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Ground floor
First floor
TOTAL
Area (sq m)
Area (sq ft)
1,947.46
20,963
170.56
1,836
2,118.02
22,799
SC
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Description & Accommodation
The property comprises a modern, purpose built foodstore constructed in 2009, totalling 22,799 sq ft arranged
over ground and first floors. It occupies a 2.2 acre (0.89 hectare) site between Wellington High Street and
Scott’s Lane and includes a generous 156 car parking spaces, giving an excellent ratio of 1:146 sq ft.
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DOMINANT, WELL-LET SUPERMARKET INVESTMENT
22,799 sq ft arranged over ground and first floors
34 -36 High Street, WELLINGTON TA21 8RD
Tenancy
Tenure
The property is entirely let to Waitrose Limited (original tenant Somerfield Stores Ltd) on
full repairing and insuring terms for 20 years without a break from 19 March 2009, expiring
on 18 March 2029. The passing rent is £412,964 per annum (£18.11 per sq ft).
Freehold.
The income increases in March 2019 to £467,231 pa due to a fixed 2.5% pa compound
uplift. Thereafter, rent reviews are 5 yearly, upward only to open market value.
The investment benefits from an attractive expiry profile, with over 12.5 years unexpired.
We consider that the passing rent is very affordable, being significantly below those of the
majority of the relevant comparables scheduled in these particulars. Importantly, the fixed
uplift in 2019 is not considered to produce an overrented situation.
Covenant
Waitrose Limited has a Dun & Bradstreet rating of 5 A1, which represents a minimum risk of business failure.
Waitrose has over 345 stores across the UK, including convenience branches and Welcome Break service
stations. Waitrose also has several stores in the Middle East as well as shipping products to around 50
countries worldwide.
More recently, John Lewis Partnership has released annual financial results for the year ended 30 January
2016. The highlights for Waitrose were as follows:
•
Gross Sales – up 1.1%
•
Operating Profit Before Property Profits – up 3.9%
•
Increase in Growth in Customer Numbers
•
12 new Waitrose branches opened
Over the last financial year Waitrose continued to outperform the industry on sales by 2.7% and increased
both market share and sales volumes with a current market share of 5.1%.
A summary of the latest available financial accounting for the past 3 years is detailed below:
Tenant
Year
Waitrose Limited
DOMINANT, WELL-LET SUPERMARKET INVESTMENT
Turnover
Pre Tax Profit
Tangible Net Worth
30 Jan 2016
£5,966,600,000
£66,600,000
£930,300,000
31 Jan 2015
£6,016,700,000
£80,600,000
£853,700,000
25 Jan 2014
£5,640,900,000
£109,100,000
£796,600,000
D&B Rating
5A1
An attractive expiry profile, with over 12.5 years unexpired
34 -36 High Street, WELLINGTON TA21 8RD
Relevant Investment Comparables
Property
Date
Waitrose, Crewkerne
December 2015
Waitrose, Colchester
Sainsbury’s, Newquay
Waitrose, Bromsgrove
March 2016
April 2016
July 2016
Price
£13,600,000
£18,800,000
£10,250,000
£3,600,000
NIY
Passing Rent (£psf )
Tenancy
5.00%
£699,448
12.5 years remaining
(£22.06)
Fixed increase September 2018
4.50%
4.96%
5.28%
(Forward Funding,
£895,376
13.5 years remaining
(£24.39)
OMV reviews
£540,500
9.25 years remaining
(£16.00)
OMV reviews
£200,640
15 year lease
(£22.27)
5 yearly CPI linked reviews at 1-3%
no free on-site parking)
Waitrose, Greenwich
pa collar and cap
On market
DOMINANT, WELL-LET SUPERMARKET INVESTMENT
£18,150,000
4.25%
£771,375
22 years remaining
(£24.77)
2.5% pa compund fixed uplifts
Waitrose has over 345 stores across the UK
EPC
The property has an EPC rating of C 52.
Planning
The property benefits from open A1 planning consent.
Copies of all relevant planning permissions are available upon request.
VAT
The property is elected for VAT.
Proposal
Our client is seeking offers in excess of £7,375,000 (Seven Million,
Three Hundred and Seventy Five Thousand Pounds), subject to
contract and exclusive of VAT. A purchase at this level would provide
an attractive 5.25% Net Initial Yield, with a reversion to 5.94% in
March 2019, assuming 6.66% purchase costs. The Equivalent Yield
is in the order of 5.8%.
34 -36 High Street, WELLINGTON TA21 8RD
Further Information
Mark Girling
T: 020 7312 7460
M: 07770 851 123
E: [email protected]
Nick Richardson
T: 020 7312 7420
M: 07818 012 420
E: [email protected]
Emily Dawson
T: 020 7312 7405
M: 07818 012 405
E: [email protected]
Misrepresentation Act 1967. Montagu Evans LLP for themselves and for the vendors or lessors of this property whose agents they are, give notice that:
(i) The particulars are set out as a general guideline only for the guidance of intending purchasers or lessees and do not constitute the whole or any part of an offer or contract. (ii) All descriptions, dimensions, references to condition and necessary permissions of the use and occupation, and other details are given in good faith without responsibility
whatsoever and any intending purchasers or tenants 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. (iii) Neither Montagu Evans LLP nor their employees has any authority to make or give any representation or warranties whatsoever in
relation to the property. (iv) Unless otherwise stated, all prices and rents are quoted exclusive of VAT and intending purchasers or lessees must satisfy themselves independently as to the applicable VAT position. (v) All the plans and maps provided within the particulars are for identification purposes only. August 2016. Alamo Design 01924 471114.