Lateral, Sweet Street

Leeds LS11 9AT


Cushman & Wakefield are instructed to market this prime multi-let Government city centre office investment. The salient investment considerations of this opportunity are set out below:
  • Prominently located within the City Walk development, providing immediate access to Junction 3 of the M621 Motorway
  • A significantly improving micro and macro location subject to significant, recent and continuing public infrastructure and private investment
  • Modern Grade A office building extending to 95,317 sq ft (NIA) across ground and four upper floors with an excellent city centre car parking ratio of  1:745 sq ft
  • Highly flexible and divisible floor plates
  • Constructed to BREEAM Excellent (2005)
  • Let by way of two co-terminus leases to The Secretary of State for Communities and Local Government and Highways England Company Limited, expiring 28 September 2021 providing unexpired lease terms of circa 4.0 years
  • Lateral is fully occupied and home to eight government departments and agencies who continue to invest heavily in the building
  • Current passing rent of £2,047,000 per annum equating to a low overall rent of only £19.13 psf, circa 34% below prime Leeds headline rents within a continually improving Leeds office occupational market
  • Recent uplift at rent review proving that the building is reversionary on a headline basis
  • Freehold 
  • Longer term prospects for lease restructures and renewals following the recent announcement that the GPU Leeds hub will be occupied by HMRC and NHS Digital
We are instructed to seek offers in excess of £24,740,000 (Twenty-Four Million, Seven Hundred and Forty Thousand Pounds), subject to contract and exclusive of VAT, reflecting a net initial yield of 7.75% assuming purchaser's costs of 6.67%, and a low capital value of £260 per sq ft.  



Leeds is the principal city of the Yorkshire and Humber region and is located 180 miles north of London, 40 miles north east of Manchester and 120 miles north of Birmingham. Benefiting from excellent access to regional and national markets and an estimated population of 751,500, Leeds is both the third largest and one of the fastest growing cities in the UK.


Leeds benefits from excellent road communications, with the M621 providing immediate access to the wider national motorway network. The M62, running east to west just south of Leeds, provides a direct link to Manchester, Liverpool and Hull, whilst the M1 connects the city to London and the Midlands.

With 38 million passengers per year, Leeds City station is the busiest in northern England and passenger numbers are forecast to double over the next 30 years. It is served by the East Coast Main Line which provides access to London King's Cross, whilst also offering direct services to a host of regional cities including Manchester, Sheffield and Newcastle.

The proposed HS2 line will be a huge boost for the city, reducing journey times to London to around 1 hour 23 minutes. Current proposals, released at the end of 2015, show the new platforms are to adjoin the existing station to create the largest station in the North of England. The preferred location for the new platforms is to the south of the existing station and this will provide further critical mass to the south of the city and mean the HS2 terminal will only be a short walk from Lateral.

Leeds Bradford International Airport lies 9 miles north of the city centre and is serviced by a dedicated coach link. It offers scheduled flights to seven destinations throughout the UK and to all of the major European economies, including Spain, Italy, Germany, France and Holland.


The wider Leeds city region represents the largest economy outside of London with a GVA of £60.5bn and the city's economy has grown by almost 40% in the past decade alone. The city is the second largest centre in the UK for financial and legal services, employing 46,000 people across the professional services sector as a whole, and is host to 20 FTSE 100 company HQs and in excess of 30 national and international banks.

Leeds benefits from a diverse private sector economic base, but the public sector is an important driver of the local economy. In fact, there are nearly 250,000 people employed in the public sector in Leeds city region, the highest number of any of the city regions and this represents 19% of the total workforce. With two large universities, and 120,000 students, the city also provides a strong pool of skilled labour.

The city is currently ranked as the UK's fifth largest shopping location, which was consolidated in March 2013 with the opening of Land Securities' one million square foot Trinity Shopping Centre in the heart of the city centre. The Leeds retail offer is set to be enhanced further with the opening of Hammerson's Victoria Gate scheme later this year. Along with its flagship John Lewis store, the scheme will provide over a million square feet of additional retail and leisure accommodation, attracting a number of new occupiers to the city, which is already home to world renowned brands and retailers like Harvey Nichols, Apple, Mulberry and Vivienne Westwood.


With frontage to Sweet Street, Lateral occupies an exceptionally prominent site towards the south of the city centre. Junction 3 of the M621 lies less than 400 metres from the building and provides unrivalled vehicular access.

The property is situated to the south of Leeds City station and set within an established office environment adjacent to Nos 1 & 2 City Walk, with Bridgewater Place a short distance to the north. These buildings are home to a number of corporate occupiers including Eversheds, DWF, Ernst & Young, AECOM and William Hill. Bridgewater Place also provides a varied ground floor amenity offer, including a Tesco Express, Philpotts, Juici Sushi and an Anytime Fitness gym.

Lateral is now within a 6.5 minute walk from Leeds City station, via its new £20 million southern entrance which opened in January this year. This is providing a huge boost for all commercial occupiers south of the station by reducing travel times whilst also providing an attractive waterside commuter experience.

The southern area of Leeds is a transforming and exciting environment with the likes of KPMG and Addleshaw Goddard recently committing to flagship new office schemes at No1 and No3 Sovereign Square respectively.

Burberry have recently announced their plans for a new £50 million headquarter facility to the west of Sweet Street (targeting completion by 2019) and other key development schemes south of the station include Holbeck Urban Village, South Bank and Leeds Dock and Hinterland.

The locality will be boosted hugely by the completion of HS2 as its terminus is currently expected to be situated within Leeds south side, close to Lateral.


Lateral was constructed in 2005 to a BREEAM Excellent standard and provides 95,317 sq ft (NIA) of Grade A office accommodation arranged over ground and four upper floors.

The building has an impressive double height entrance/reception and the ground to third floors are arranged over two wings around a centrally located core. The fourth floor is smaller and arranged over a single wing, but all of Lateral's floor plates are flexible and can be easily and efficiently divided, providing excellent potential for multiple occupancy.

Lateral was constructed to the following specification:

  • Four pipe fan coil comfort cooling/heating
  • Suspended ceilings throughout (predominantly metal tiled)
  • LG3 lighting landlord installation
  • Floor to ceiling heights of 2.8 metres
  • Fully accessed raised access floors (150mm void)
  • Three 13-person passenger (1,000 kg) lifts
  • Recently installed shower and cycle facilities
The tenants have invested heavily in the building. In 2013, The Environment Agency carried out significant refurbishment and fit-out works to ground, second and part third floors, and in 2014 Highways England completed a light refurbishment, including an LED lighting upgrade, to the third and fourth floors.

The building provides 128 parking spaces delivering an excellent city centre parking ratio of 1:745 sq ft.


The property has been measured by Plowman Craven Associates in accordance with the RICS Property Measurements (1st Edition), which incorporates the new International Property Measurement Standards (IPMS) and became effective on 1 January 2016. On this basis Lateral has a lettable floor area (excluding reception) of 100,028 sq ft. Further details can be found within the link below.


Lateral is held freehold under title number WYK737393 as delineated on the plan.


The property is let by way of two co-terminus leases expiring 28 September 2021 as summarised below and provides an unexpired lease term of circa 4.0 years.

The leases are drawn on effective fully repairing and insuring terms and the rent equates to a rate of only £19.13 psf, assuming an allocation of £1,750 per car parking space. The current rents were agreed on a net effective basis at the 2016 rent reviews, proving that the building is reversionary on a headline basis.

Covenant Information

Both leases were originally granted to The Secretary of State for Communities & Local Government, but the lease over the third and fourth floors was transferred to Highways England Company Limited (Company No: 9346363) in April 2015 by way of a transfer scheme made by the Secretary of State under section 15 of the Infrastructure Act 2015. The Secretary of State for Communities & Local Government provides an undoubted government tenant covenant. Highways England Company Limited is a wholly owned Government company which looks after the operation and maintenance of England's national motorway and major A road network. This includes modernising and maintaining the highways and the management (and prevention) of incidents on England's motorways through the Traffic Officer service. Further information on Highways England Company Limited can be found at


The property is subject to an option to tax and VAT will therefore be payable upon the purchase price. However, it is anticipated that the sale can be treated as the transfer of a going concern (TOGC).


Lateral has an EPC rating of D(79) which is valid for a further 10 years. A copy of the certificate and recommendation report can be found within the data room.


Significant capital allowances remain unclaimed and are available to be transferred to a purchaser by way of negotiation. Further information in relation to capital allowances is available within the data room.


We are instructed to seek offers in excess of £24,740,000 (Twenty-Four Million, Seven Hundred and Forty Thousand Pounds), subject to contract and exclusive of VAT, reflecting a net initial yield of 7.75% assuming purchaser's costs of 6.67%, and a low capital value of £260 per sq ft.

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