KOSO Kent Intro Ltd - LSH Investment Sales

KOSO Kent Introl Limited,
Unit 1 & 2 Armytage Road, Brighouse HD6 1QF
Two secure income distribution warehouses
Investment Summary
• Strategically located close to junction 25 of the M62 motorway
which links with the M60 to the west and M1 to the east providing
direct access to the national motorway network.
• Two self contained warehouses totaling 4,517 sq m (48,626 sq ft)
and 3,465 sq m (37,300 sq ft).
• Freehold.
• Both units are let to GE Oil & Gas UK Limited on FRI leases for a term
of 20 years expiring 23rd June 2025. The units have been sublet to
KOSO Kent Introl Limited.
• Current passing rent of £307,250 per annum equating to £3.58 per
sq ft overall.
• We are instructed to seek offers in excess of £3,700,000 (Three
Million Seven Hundred Thousand Pounds), subject to contract, for
the freehold interest. This reflects a net initial yield of 7.85%
assuming purchaser’s costs of 5.80%.
A59
A660
A19
Location
A1(M)
Brighouse is a town within the Metropolitan Borough of Calderdale, in West Yorkshire,
A671
Burnley
England. Historically within the West Riding of Yorkshire, it is situated on the River Calder,
M62
M62
of Manchester, 8 miles south of Bradford and 15 miles south west of Leeds.
A6033
Brighouse
M61
M61
leads onto the M1, M60 and the M18 together with the A644 and A641 roads, all providing
A666
25
HuddersfieldA637
M66
M66
M62
Bolton
A61
A1
M1
M1
M
Wakefield
M58
access to the surrounding region.
Regular train services are available from Brighouse station to London via Leeds with a fastest
journey time of approximately 2 hours 54 minutes. The nearest airport Liverpool
is Leeds Bradford lying
M53
M53
M6
M6
Doncaster
A628
Manchester
17 miles to the north east.
M1
M1
M621
M621
Blackburn
4 miles east of Halifax in the Pennines. The town also lies approximately 26 miles north east
Preston
Brighouse benefits from good communication links being a short distance to the M62 which
Leeds
Bradford
M65
M60
M60
M62
Sheffield
M1
M1
Peak District
M56
M56
M6
M6
A61
A623
A6
Situation
The properties are located 0.8 miles from Junction 25 of the M62.
eS
t
r St
Ln
hu
Mill
Ar t
of Armytage Road Industrial Estate, approximately 0.75 miles east of Brighouse Town Centre.
A644
Ge
org
The site is prominently situated and has direct access off Armytage Road, which forms part
M62
Brighouse
A644
Arm
yta
The immediate area comprises an established industrial estate providing warehouse /
A641
distribution units of a mix of ages and size. Local occupiers include, British Car Auctions,
Brighouse Station
ge
Rd
1
2
Armytage Rd
Junction25
25
Junction
Clipper Logistics, Plumb Center, Travis Perkins and Myers Building Supplies.
M62
Demographics
Brighouse is a bustling commuter town and has a population of approximately 32,360
residents with Calderdale catchment area serving 203,800 people.
M62
A641
A644
Description
The properties comprise two detached warehouse units, both of which are accessed from
Armytage Road.
Unit 1
The unit comprises a triple bay warehouse building with two storey offices to the front of full
height brick construction on a secure site. The unit was constructed in 1975 and is used for
production and manufacturing of oil & gas valves.
Unit 1
River C
alder
The warehouse is of steel portal frame construction with part brick part profile clad elevations.
The unit has a minimum eaves height of 5.5m and two steel concertina shutter doors.
Hectares
Acres
Site Coverage
Unit 1
0.65
1.61
61%
Unit 2
0.81
2.00
37%
KE
FIE
L
AR
MY
ous
e
WA
Armytage Industrial Estate
Unit
ESS
Site
Mast (Telecommunication)
Externally, there is a secure concrete yard area and car parking for approximately 76 spaces
as well as an element of expansion land to the rear of the site.
Ho
us
e
CR
The warehouse is of steel portal frame construction with part brick part steel profile clad
elevations. The unit has a minimum eaves height of 5.4m and four concertina shutter doors.
yta
ge
Pro
jec
tH
Ar
m
Unit 2
This unit comprises a double bay warehouse building with three storey offices to the front of
full height brick construction on a secure site. The unit was constructed in 1981 and is used
for the testing and storage of oil & gas valves.
D
TA
GE
Externally there is a secure concrete yard area and car parking for approximately 21 spaces.
RO
AD
RO
AD
Unit 2
Accommodation
The unit has been measured in accordance
with the RICS Code of Measuring Practice 6th
Edition and provides the following approximate
gross internal areas:-
Unit 1
Description
Sq M
Sq Ft
3,403.78
36,638
GF Offices
333.24
3,587
1F & 2F Offices
780.49
8,401
4,517.51
48,626
Sq M
Sq Ft
3,047.03
32,798
GF Offices
139.45
1,501
1F Offices
139.46
1,501
2F Offices
139.45
1,501
Total
3,465.39
37,300
Grand Total
7,982.90
85,926
Warehouse
Total
Unit 2
Description
Warehouse
Tenure
Both properties are held freehold.
Tenancy
The properties are let to GE Oil & Gas UK Limited on two separate co-terminus leases for a term of 20 years from 24th June 2005 expiring 23rd June 2025. The leases are held on FRI terms at a
current passing rent of £176,000 and £131,150 reflecting an overall rent of £3.58 per sq ft.
Both leases have been sublet to KOSO Kent Introl Limited.
The tenant has been in occupation of both units since construction and occupy a further third unit within Brighouse that is used for the refurbishment of oil & gas valves.
Covenant
GE specialises in Aviation, Energy Management, Healthcare, Oil & Gas, Power & Water and
Transportation, the company employs over 45,000 people worldwide and invests $5 billion in
research and development every year.
GE Oil & Gas UK has had operations in the UK since the 1930s. The company has invested over
£10 billion in UK business through acquisitions since 2002. The company now has more than
45 locations in the UK, including 25 manufacturing facilities.
We have undertaken a Graydon report for the sub tenant KOSO Kent Introl Limited,
which provides a “2A Excellent” rating and a “low” risk profile for the sub tenant.
It also provides the following information:-
Year to
Turnover
KOSO Kent Introl Limited was founded in 1967 as Introl Ltd and located in the north of England at
Brighouse, mid-way between Leeds and Manchester. The objectives of the company were
to provide a specialised control valves service for the rapidly expanding UK energy industry
(petroleum, gas, electricity, etc) and for the continuously changing chemical industry. Introl
Ltd very quickly established itself within these industries and soon achieved a reputation for
delivering high quality control valves of both conventional and customised high technology
designs.
In 2005, Nihon KOSO Co Ltd of Japan purchased Kent Introl from Vetco Gray and the company
was renamed KOSO Kent Introl Limited (KKI). Throughout this time the company has
remained focused on its original objectives and is today one of the largest leaders in design
and manufacture of surface and subsea control valves, severe service valves and subsea
choke valves.
Major clients include the major oil and gas companies such as Statoil, Exxon and BP as well
as Maintenance, Repair and Operations (MRO) businesses including AIOC, AMEC and KBR.
Pre-tax Profit
Net Worth
31/03/2014 31/03/2013 31/03/2012
(£000’s)
(£000’s)
(£000’s)
28,984
33,004
24,661
1,716
3,937
2,343
19,055
17,627
14,939
We have also undertaken a Graydon report for GE Oil and Gas Ltd, which provides
a “2A Excellent” rating and a “low” risk profile.
It also provides the following information:-
Year to
Turnover
Pre-tax Profit
Net Worth
31/12/2013 31/12/2012 31/12/2011
(£000’s)
(£000’s)
(£000’s)
494,009
263,717
301,807
28,345
(66,107)
(19,056)
8,819
(12,007)
66,226
Industrial Investment Market Overview
The industrial investment market gathered pace in the first half of the year, with £3.05bn transacted, the third highest
level since 2007. Activity in the regions, in particular the North West/Yorkshire has proven buoyant on the back of the
automotive, aerospace and internet retail sectors. This is where the bulk of speculative development and pre-let activity
is taking place.
IPD figures show that the industrial sector provided the highest total returns in comparison with Office and Retail. This
is due to a shortage of good quality, ready to occupy warehouse space in the Yorkshire and Humber region and this has
led to a shift in market dynamics.
More recently there has been a lack availability within Brighouse and we expect Landlords will start to see s ome rental
growth with the most recent letting completing in June 2014 at Armytage House, adjacent to the s ubject site.
Date
Address
Tenant
Unexpired
Years
Price £
NIY %
Available
Tetley Tea Factory
Eaglecliffe
TATA Global
Beverages GB Ltd
8
£6,000,000
7.40%
Under Offer
Waterside Park
Wednesbury
TR Fastenings
10
£2,520,000
6.75%
Aug-15
One 100 Winsford
Industrial Estate
Howard Tenens
10
£4,882,000
6.50%
March-15
National Court
Leeds
Nationwide Crash
Repair Centres Limited
5.5
£2,360,000
7.51%
Feb-15
Waterside Park
Tipton
AF Blackmore & Son
9.75
£6,300,000
6.07%
VAT
The properties are elected for VAT and it is proposed that the sale will be treated as a Transfer of a Going Concern.
Corporate Structure
The freehold interest of the property is held in an Isle of Man SPV and the asset can be purchased as an SPV or as an
asset disposal. Further information is available on request.
EPC
The properties have EPC ratings of D83 /C72 respectively. Certificates are available on request.
Proposal
We are instructed to seek offers in excess of £3,700,000 (Three Million
Seven Hundred Thousand Pounds) subject to contract and exclusive
of VAT.
A purchase at this level reflects Net Initial Yield of 7.85% allowing for
usual purchaser’s costs of 5.80%.
Further Information
For further information or to arrange an inspection please contact:
Philip Colman
T: 0207 198 2100
E: [email protected]
Charlie How
T: 0207 198 2248
E: [email protected]
Ben Roberts
T: 0161 228 6411
E: [email protected]
Subject to Contract and Exclusive of VAT © Lambert Smith Hampton September 2015
Disclaimer: Lambert Smith Hampton Group Limited and its subsidiaries and their joint agents if any (“LSH”) for themselves and for the seller or landlord of the property whose agents they are give notice that: (i) These particulars are given and any statement about the property is made without responsibility on the part of LSH or the seller or landlord and do not constitute the whole or any part of an offer or contract. (ii) Any description, dimension, distance or area given or any reference made to condition, working order or availability of services or facilities, fixtures or fittings, any guarantee or warrantee or statutory or any other permission, approval or reference to suitability for use or
occupation, photograph, plan, drawing, aspect or financial or investment information or tenancy and title details or any other information set out in these particulars or otherwise provided shall not be relied on as statements or representations of fact or at all and any prospective buyer or tenant must satisfy themselves by inspection or otherwise
as to the accuracy of all information or suitability of the property. (iii) No employee of LSH has any authority to make or give any representation or warranty arising from these particulars or otherwise or enter into any contract whatsoever in relation to the property in respect of any prospective purchase or letting including in respect of any re-sale
potential or value or at all. (iv) Price or rent may be subject to VAT and any prospective buyer or tenant must satisfy themselves concerning the correct VAT position. (v) Except in respect of death or personal injury caused by the negligence of LSH or its employees or agents, LSH will not be liable, whether in negligence or otherwise howsoever,
for any loss arising from the use of these particulars or any information provided in respect of the property save to the extent that any statement or information has been made or given fraudulently by LSH. (vi) In the case of new development or refurbishment prospective buyers or tenants should not rely on any artists’ impressions or architects’
drawings or specification or scope of works or amenities, infrastructure or services or information concerning views, character or appearance and timing concerning availability or occupation and prospective buyers or tenants must take legal advice to ensure that any expectations they may have are provided for direct with the seller or landlord
and LSH shall have no liability whatsoever concerning any variation or discrepancy in connection with such matters.