Team Valley is regarded as the North East's principal commercial estate located approximately 2.3 miles south of Newcastle city centre. The estate is situated within Gateshead and is part of the Tyneside conurbation, the UK's 7th largest with a population of over 775,000 people. Team Valley is bounded by the East Coast Mainline to the east, and the A1 to the west, with the recent £60m upgrade to the A1 which completed in 2016, significantly improving transport links to the estate.
The area is well served by public transport with Newcastle Central, a main station on the East Coast Mainline, connecting the city to London in 2 hours and 50 minutes and Edinburgh in 1 hour 30 minutes. The Tyne and Wear Metro comprises 60 stations throughout the county, and is the second largest system in the UK, behind the London Underground.
The property comprises three modern warehouse/manufacturing units with both Factory 1 and Factory 2 interlinked and fronting onto Kingsway, and Factory 3 fronting onto Princesway.
Factory 1 comprises a large single bay industrial unit of steel portal frame construction with cavity block and profile metal sheet clad elevations under a pitched profile metal roof. The office elevation comprises cavity blockwork walls with a combination of brick and glazed curtain wall cladding. The office accommodation features an impressive double height atrium and is well specified to benefit from gas central heating and suspended ceilings as well as WCs, kitchen facilities and a squash court.
Factory 2 is a single steel portal frame industrial unit with block and profile sheet elevations under a pitched profile metal roof incorporating translucent panels. Internally the unit has concrete floors, suspended lighting throughout, with 4.5m minimum eaves rising to 6m at the apex. There is a roller shutter door to the northern elevation, which leads into the large yard shared with Factory 1.
Factory 3 comprises a single bay industrial unit of steel portal frame construction, with part block, brick and profile sheet clad elevations, under a pitched metal roof incorporating translucent panels.
Internally, the warehouse is well specified to include concrete floors, heating and lighting throughout and has a minimum eaves height of 5.1m rising to 7.5m at the apex. The unit benefits from 17 electrically operated doors on the north, south and west elevations into the large secure yard. The offices comprise two storeys of modern accommodation fitted out to a very high specification, including suspended ceilings with integrated lighting, air conditioning and gas central heating, WCs and kitchen facilities.
Both properties are held on a long leasehold basis at a peppercorn without review. Unit 391 Kingsway is held from 25/1/1988 expiring 24/1/2113 and Unit 398a Princes Way from 29/1/1989 expiring 28/1/2114.
The properties are let to Express Engineering (Gateshead) Limited on two co-terminus FRI leases. The newly regeared leases will run for 15 years upon completion, with five yearly RPI linked rent reviews subject to a collar and cap of 1% & 3%. From completion, the tenant will pay an annual rent of £355,000.
Express Engineering provides precision manufacturing solutions of complex components in exotic metals and works across aerospace, defence, oil and gas, marine and nuclear sectors. They have been based in the North East since inception and have occupied the subject property since 1988 and now employ over 200 highly skilled workers.
The company have expanded into global markets significantly and have spent over £9,500,000 on machinery in the last three reported accounting periods to keep pace with demand. Clients include Rolls Royce, GE, esterline, BAE and Siemens.
The company's financial accounts for the period ending 30th September 2016 show a turnover of £43.6m with an operating profit before exceptional items of £4.3m and shareholders funds of £17.2m. These figures reflect the group refocussing away from the declining oil and gas sector, including the closure of the group's Brazilian operations at a one off exceptional cost of £13m. The group's balance sheet has subsequently been further strengthened by a refinance which reduces the interest costs, whilst providing capital to invest in expansion into high value markets.
Further information can be found in the marketing brochure.
The property has been elected for VAT and it is anticipated the transaction will be treated as a TOGC.
We have been instructed to seek offers in excess of £5,300,000 (Five Million, Three Hundred Thousand Pounds) reflecting a NIY of 6.28% after deducting purchaser's costs of 6.60%