10 Canons Way is held freehold under title number L81158 as delineated in green on the situation plan.
10 Canons Way is let to Scottish Widows Limited (Company No: 03196171) (formerly Clerical Medical Investment Group Limited) by way of a fully repairing and insuring lease expiring 1 November 2032, providing an approximate unexpired term of 16.75 years.
The contracted passing rent is £4,460,011 per annum, equating to £25.67 per sq ft assuming a half rental rate is applied to the reception and atrium area. The lease is subject to fixed rental uplifts to £5,046,093 per annum (£29.04 per sq ft) on 2 November 2017 and £5,709,191 per annum on 2 November 2022. The rent is not reviewed in 2027.
The vendor proposes to top up the rent to £5,046,093 per annum from completion until the fixed rental uplift in November 2017.
The lease is subject to restrictions on assignment, most significantly where the proposed assignment will have a materially detrimental effect on the value of the landlord's reversionary interest. Assignment cannot be restricted where it is to a Government or Local Authority covenant, or to a company that is listed within the FTSE 100 or with a Standard & Poors rating of A+ [or better].
Scottish Widows Limited
Scottish Widows Limited is one of the UK's leading providers of pensions and investments, with funds under management totalling £22.9bn as at December 2014, having increased from £21.9bn in 2013. Products and services offered by them include providing individual pension plans, investment bonds, collective investment accounts and investment ISAs.
In January 2009, Scottish Widows Limited (then Clerical Medical Investment Group Limited) became part of the Lloyds Banking Group (LBG), one of the largest financial service providers in the UK. It contributes to the Life Insurance results within LBG's Insurance Division, which it deems to be a core but significantly under-served need for its customers.
Scottish Widows Limited, part of Scottish Widows Group, has been allocated the following independent credit ratings, all of which are regarded as investment grade:
Standard & Poors: A
Dun & Bradstreet provide the tenant with a credit rating of 5A1, representing a minimum risk of business failure.
The property is not subject to an option to tax and as such VAT will not be payable on the purchase price.
We are instructed to seek offers in excess of £92,000,000 (Ninety-Two Million Pounds), subject to contract for our client's freehold interest.
A purchase at this level reflects a net initial yield of 5.18% on the proposed topped up rent at completion of £5,046,093 per annum, assuming standard purchaser's costs of 5.80% and a reversionary yield of 5.87% in November 2022. This reflects a capital value of £521 per sq ft.