Burrington Business Park, Burrington Way

Plymouth, Devon PL5 3LX

Overview

  • Burrington Business Park is a multi-let industrial asset
  • The property is located adjacent to the A38 Devon Expressway in north Plymouth, providing quick access to the M5, Cornwall, Devon and Plymouth city centre
  • An extensively refurbished industrial property providing predominantly industrial/warehouse accommodation totalling around 106,785 sq ft with units ranging between 807 and 14,919 sq ft
  • The landlord has invested in excess of £3 million refurbishing the property, including significant capital expenditure on energy efficiency savings comprising insulated cladding, an energy-saving roof and the installation of solar panels
  • A net rental income of £523,458 per annum, reflecting a low average rent of £4.54 per sq ft on the industrial space and £6.64 per sq ft on the office accommodation
  • A gross rental income of £599,751 per annum, reflecting a low average rent of £4.81 per sq ft on industrial space and £9.50 per sq ft on the office accommodation
  • The property comprises 16 units let to 11 separate tenants
  • The weighted average unexpired lease term is 7.37 years to expiry and 4.12 years to lease events
  • Site area of 7.58 acres (3.07 hectares), providing a low site coverage of approximately 32%
  • Freehold
  • The vendor has had detailed plans prepared for six additional units, providing the potential to deliver an extra 18,000 sq ft
We are instructed to seek offers in excess of £6,544,000 (Six Million, Five Hundred and Forty-Four Thousand Pounds) for our client's freehold interest, subject to contract and exclusive of VAT.

A purchase at this level would reflect a net initial yield of 7.50%, assuming purchaser's costs of 6.64%, and a low capital value of £61.28 per sq ft.

Location

Plymouth city centre is situated 2.8 miles to the south of the property and access to the city centre is provided by the A386. The A38 Devon Expressway provides connectivity to the M5 at Exeter to the north east and Cornwall via the A390 and A30 arterial roads to the west.

The city has a population of 260,000 within the primary catchment area, rising to over 1.1m within a 3-hour drive.

Key employment facts:

  • There are 131,400 people in employment within the catchment, the nearest competing centres by size are Bournemouth and Poole (127 miles), and Portsmouth (171 miles)
  • Employment in Manufacturing and Transport & Storage in Plymouth stood at 18,000 people or in percentage terms, 13.7% of total employed; above the national average assessed by ONS of 10.7%
  • Financial & Business Services employment is aligned with the national average at 5.0%
  • Plymouth's unemployment rate was 5.0% June 2016 - June 2017, which was 1.3% higher than the South West average and 0.3% higher than the average for Great Britain

MAJOR EMPLOYERS

Defence: the Plymouth economy has traditionally been linked with maritime defence with over 12,000 people employed and approximately 7,500 in the armed forces. Devonport Dockyard is the only UK naval base that refits nuclear submarines and the Navy estimates that the Dockyard generates about 10% of Plymouth's income. All new UK naval Frigates will now be based in Plymouth in the future following a recent Government announcement securing much employment and which will likely see the expansion of the Royal Navy in Plymouth for the first time in many decades. Plymouth has the largest cluster of marine and maritime businesses in the South West with 270 operating within the sector.

Acting as the regional hub, Plymouth hosts the city council plus the South West Business Council. The public sector is the prominent employer for the city with a high number of employees in health, education, administration and defence.

Other substantial employers include the University of Plymouth with almost 3,000 staff, the Plymouth Gin Distillery, The Range headquarters and Plymouth Science Park which employs 500 people across 50 companies.

Situation

Burrington Business Park is Plymouth's premium hub for businesses, with neighbouring occupiers including Bookers Wholesale, SSE Contracting, Bestway Cash & Carry and Mitie Property Services.

SITE AREA

The site totals approximately 7.58 acres (3.08 hectares), providing a low site coverage of approximately 32%.

Description

Burrington Business Park comprises an extensively refurbished, multi-functional mix of warehousing and distribution facilities, as well as contemporary office space situated amid landscaped grounds offering ample parking. Vehicle movements have been specifically split to separate HGV and van movement to the rear of the site directly to the logistics and storage units, some of which offer dock levellers.

The property extends to approximately 106,785 sq ft, providing predominantly industrial/warehouse accommodation.

The building is of steel frame construction, with a concrete floor, blockwork walls with predominantly profile steel sheeting to the walls and roof. The property provides a large parking area which wraps around the entire property. The warehouse specification includes full eaves height of up to approximately 5.02m as well as level access loading doors and 10 dock levellers.

The specification of the offices includes double glazed windows, 2.40m floor to ceiling height, suspended ceilings with recessed LED lighting, perimeter trunking and roof mounted VRF heating and cooling system.

LANDLORD REFURBISHMENT

The landlord acquired the property in 2014, since which time in excess of £3.00m has been invested in the property with a focus on energy efficiency, including the installation of insulated cladding, energy-saving roofing and solar panels.

ACCOMMODATION

The property has been measured in accordance with the RICS Property Code of Measuring (6th Edition) and provides Gross Internal Floor areas as seen in the accommodation schedule in the link below:


Tenure

The property is held freehold under title number DN185684.

Tenancy

The property is let to 11 tenants providing a weighted average unexpired lease term of 7.37 years to expiry and 4.12 years to lease events.

For the purpose of the disposal of this investment, the vendor will top up the net rental income to £523,458 per annum, reflecting a low average rent of £4.54 per sq ft on the industrial space and £6.64 per sq ft on the office accommodation.

Service Charge

Each tenant's rent is inclusive of a contribution towards service charge with the exception of The British Red Cross. The budget is currently running at £79,000 per annum, which save for £2,076.55 is not recoverable from the tenants. The service charge equates to £0.30 per sq ft (warehouse) and £2.86 per sq ft (offices).

For the purposes of pricing (see Tenancy Schedule), we have deducted £76,293 from the gross income to reflect the landlord's contribution.

Further information is available upon request.


Covenant Information

Construction Materials Online Limited (30.85%)
The principal activity of the company is the retail of roofing, drainage and insulation supplies. During 2017 the business saw exceptional growth, with turnover increasing 44% to £26.5m. The business also saw gross profit increase by 39% to £4.4m, with gross margin decreasing slightly from 17.1% to 16.4%, as the company maintained its strategy of passing on the benefits of competitive pricing to its customers.

Construction Training South West Limited (19.27%)
Construction Training South West provides a wide range of courses and qualifications in professional and technical vocational diplomas at all levels, and a range of apprenticeships. The Company has an excellent track record with recognised employers throughout the South West.

Rogers Wholesale Foods Limited (13.03%)
Rogers Wholesale Foods started in January 2015 and has expanded quickly to operate "The UK's Biggest Gone Past Best Before Warehouse". The company now operates its flagship warehouse from Burrington Business Park, along with further premises in Poole and Southampton.

Magma Moulding Limited (7.24%)
Magma Moulding Limited is part of Magmatic Group and supports its belief that travel is about new experience, creating memories and making every journey just as exciting as the destination. Magma manufactures the world famous Trunki suitcase using its specialist skills in technical and engineering mouldings, which also assists in supplying a range of third party UK customers, including the particularly demanding automotive sector.

More information can be found in the link below:


VAT

It is anticipated that the sale will be treated as a going concern (TOGC).

EPC

Energy Performance Certificates are available upon request.

Plymouth Industrial Market

Further information can be found in the Marketing Brochure.

Proposal

Instructions are to seek offers in excess of £6,544,000 (Six Million, Five Hundred and Forty-Four Thousand Pounds) for our client's freehold interest, subject to contract and exclusive of VAT.

A purchase at this level would reflect a net initial yield of 7.50%, assuming purchaser's costs of 6.64%, and a low capital value of £61.28 per sq ft.

Download Brochure



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NET INITIAL YIELD:
7.5%
PRICE:
£6,544,000
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