Mavor Avenue

East Kilbride G74 4QX

Overview

East Kilbride is Scotland's most successful new town and forms part of the Glasgow conurbation.

Part of a dominant retail warehousing cluster serving a primary retail catchment of 144,000 people.

Modern retail park comprising three units, extending to a total of 34,898 sq ft (GIA).

Retailer line-up of Home Store + More, Carpetright and Bensons for Beds.

Demand for the park has been demonstrated by the recent arrival of Home Store + More and in the wider park by the arrival of Pets at Home, The Range, Halfords, Home Bargains and Aldi.

The property provides an annual rental of £849,965 per annum.

Attractive Wault to Expiry of 7.31 years and to break of 6.54 years.

We are instructed to seek offers over £8,000,000 for our client's Heritable Interest in the property.

A purchase at this level reflects a Net Initial Yield of 9.96%, allowing for purchaser's costs of 6.66%.

Location

East Kilbride is part of the Glasgow conurbation, approximately 10 miles south east of Glasgow city centre. It is the largest town within the South Lanarkshire council area and has a population of over 75,000.

Communications

East Kilbride has excellent accessibility to the M77, M74 and M8 which form the heart of the country's motorway network. The A725/A726, on which the subject property is situated, is the principal east/west route through East Kilbride and forms the Glasgow Southern Orbital which links the town with the M77 to the west and the M74 to the east.

As part of the Glasgow City Deal, there will be improvements made to transport infrastructure, including upgrades to the A726, the M77 and the M8. This will make East Kilbride an even more attractive location to residents and it will also make East Kilbride Retail Park even more accessible.

Situation

East Kilbride Retail Park is situated on the north side of the town, on the junction with the main arterial routes to Glasgow (A749) and to Hamilton, Motherwell and Bothwell (A725).

East Kilbride Retail Park lies beside Kingsgate Retail Park, which provides over 268,821 sq ft of retail warehousing, anchored by Sainsbury's with other tenants including TK Maxx, Boots, Nike, M&S Simply Food and Next. Adjacent to the subject is a 106,000 sq ft B&Q. Opposite the parade is another retail parade let to The Range, Halfords, Pets at Home and Currys/PC World. There is also a neighbouring new development let to Aldi and Home Bargains.

The retail warehouse provision on the south side of Glasgow is limited, with the 166,350 sq ft Auldhouse Retail Park being the main park, which is 7 miles away and a 23 minute drivetime.

Immediately to the south of East Kilbride Retail Park is a new housing development on the site of the old Rolls Royce factory, creating 477 new homes.

Demographics

The East Kilbride catchment population includes a higher than average proportion (17%) of older working age adults aged 45-64 (Source: 2018 CACI), due to it being an attractive location for families. This flows through to there being a stable number of 15-24 year olds which is in line with the UK average.

Within a 10 minute drive time catchment of the retail park, the annual expenditure estimate is around £589,355,364 (Source: 2018 CACI). Within a 10-20 minute drive time catchment of the retail park, the annual expenditure estimate is around £2,391,530,180 (Source: 2018 CACI).

The retail catchment includes the wealthy suburban areas of Glasgow, which include Giffnock, Newton Mearns and Whitecraigs.

In South Lanarkshire between 2017-2022 there are plans for a further 3,800 new private sector homes and 1,100 new affordable homes. Part of this housing need is satisfied by the redevelopment of the adjacent former Rolls Royce site, which will accommodate 477 homes.

Now that key infrastructure funding has been agreed as part of the £1.13 billion Glasgow City Region City Deal, more than 2,500 new homes are set to be built in East Kilbride post 2022.

Description

The subject property comprises a parade of three retail warehouse units of steel frame construction, with the walls a combination of blockwork and composition cladding panels. The units were originally developed in 2005 alongside the 106,000 sq ft B&Q. Units 1 and 3 have tenant installed mezzanines.

The units are accessed from Mavor Avenue. The terrace has 171 allocated car parking spaces, providing a ratio of 1:204 with the adjoining B&Q having a further 422 spaces. The units are serviced via Mavor Avenue onto a fully enclosed yard to the rear of the terrace.

Tenure

The property is held on a heritable title (Scottish equivalent of English Freehold).

Tenancy

The current rent is £849,965 per annum.

Attractive WAULT to expiry of 7.31 years and to break of 6.54 years.

A schedule of tenancy can be found within the link below


Covenant Information

Demand for the Park has been demonstrated by the recent arrival of Home Store + More and by the arrival of Aldi, Home Bargains, Pets at Home, The Range and Halfords within the wider East Kilbride Retail Park.

PLANNING

The site was originally given planning permission in September 2004 for the development of two non-food retail warehouse units with further permission granted for a third unit in December 2005. The original consent limited the use of the units to the sale of D.I.Y goods, furniture, carpets, electrical goods, household furnishing and motor accessories. In 2012 the landlord obtained consent to broaden the permitted uses for the occupancy of Toys R Us of Unit 1 to include the sale of toys, games, sports equipment, cycles and baby products. In 2015, Toys R Us successfully applied to further widen the permitted uses of their unit to include the retail sale of fashion accessories from not more than 25 sq m of the unit.

SERVICE CHARGE

The current service charge budget to the year end 30th April 2020 is £24,500. This reflects a cost to the tenants of £0.70 per sq ft based on the areas within the tenancy schedule.


VAT

The property has been elected for VAT and therefore VAT will be payable on the purchase price. However, it is anticipated the sale will be treated as a Transfer of a Going Concern (TOGC).

AML

A successful bidder will be required to provide AML information in accordance with HMRC regulations when Heads of Terms are agreed.

EPC

EPCs are available on request.

Proposal

We are instructed to seek offers in excess of £8,000,000 (Eight Million Pounds Sterling) exclusive of VAT for the benefit of our client's interest.

A purchase at this level would reflect a net initial yield of 9.96%, after allowing for purchaser's costs of 6.66% based on Scotland's Land and Buildings Transactions Tax (LBTT).

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NET INITIAL YIELD:
9.96%
PRICE:
£8,000,000
REGISTER INTEREST
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