47 CONDUIT STREET
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47 CONDUIT STREET LONDON W1 Flagship Retail Investment Opportunity
Transcript of 47 CONDUIT STREET
47 CONDUIT STREETLONDON W1
Flagship Retail Investment Opportunity
INVESTMENT SUMMARY• Flagship prime retail investment opportunity in the heart of
Mayfair, one of the world’s most exclusive retail locations
• Situated on the south side of Conduit Street, close to the junction with Savile Row and New Bond Street
• Ground floor and basement retail unit with three upper floors comprising office accommodation, totalling a net internal area of 4,323 sq ft
• Potential for additional fourth floor subject to planning and opportunity to open up basement to create extra retail accommodation
• The whole property is let to Lalique Limited for a term of 15 years from 4 August 2008 (approximately 8 years unexpired), there is an upwards only rent review on 4 August 2018
• The current passing rent is £290,000 per annum, reflecting £293 Zone A and £70.00 per sq ft on the self-contained offices
• Virtual Freehold from the City of London for a term of 2,000 years from 25 December 1889 at a fixed ground rent of £7.88 per annum
• Offers in excess of £14,000,000 (Fourteen Million Pounds), subject to contract and exclusive of VAT reflecting a net initial yield of 2.03% and a reversionary yield of 2.98% after purchaser’s costs of 1.80% and a capital value of £3,238 per sq ft.
Founded over a century ago, in 1888, Lalique has endured as the ultimate symbol of French luxury.
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Regent Street Oxford Street Bond Street St James’s Park Berkeley Square Grosvenor SquareBuckingham Palace
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Conduit Street
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LOCATIONConduit Street is located in the heart of Mayfair in London’s West End, which is renowned as one of the world’s most exclusive retail locations. Mayfair is characterised by a blend of exclusive retailers, high quality office buildings and luxury residential accommodation. Mayfair boasts a wide selection of high end international restaurants including Sketch, Novikov, Scotts, Nobu, Hakkasan and hotels including The Westbury, The Ritz, Claridge’s and The Connaught.
SITUATION Conduit Street links Regent Street to the east, New Bond Street to the west and Savile Row to the south. Conduit Street runs east-west between Regent Street and New Bond Street. The subject property is situated on the south side of the street and abuts Donna Karen and Crombie, immediately west of the junction with Savile Row. Conduit Street has become an important retailing link between the luxury Bond Street retail and the high end Regent Street market. It remains a prestigious office location being situated within the core Mayfair district.
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COMMUNICATIONS Conduit Street benefits from excellent public transport and is served by Oxford Circus (Central, Bakerloo and Victoria lines), Bond Street (Central and Jubilee lines) and Green Park (Piccadilly, Jubilee and Victoria lines) Underground stations.
London’s International airports are accessed via the Heathrow Express departing from Paddington and the Piccadilly line as well as the Gatwick Express departing from Victoria Station.
The opening of the Crossrail station in Hanover Square (2 minutes walk) in 2018 will have a significant impact on both retail and office lettings in Mayfair. The new rail link will provide access to Heathrow (29 minutes) and Canary Wharf (13 minutes).
CROSSRAIL ROUTE MAPC
ARNABY ST.
Hanover Square
Cavendish Square
Grosvenor Square
Berkeley Square
GreenPark
HydePark
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Golden Square
Leicester Square
St James’s Square
Soho Square
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OXFORD STREET
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Green Park
Oxford Circus
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Oxford Circus
Bond Street
Tottenham Court RdTottenham Court Rd
Leicester SquareLeicester Square
Piccadilly CircusPiccadilly Circus
Bond Street
Paddington TottenhamCourt Road
LiverpoolStreet
ShenfieldRomford
Brentwood
Goodmayes
SevenKings
ChadwellHeath
GideaPark
IlfordForestGate
HaroldWood
ManorPark
Stratford
WhitechapelFarringdon
Bond StreetIverSloughTaplow
ActonMain Line
WestEaling
Langley WestDrayton
HeathrowAirport
EalingBroadwayHanwell
Southall
Hayes &Harlington
AbbeyWood
Maryland
BurnhamMaidenhead
Reading
CanaryWharf
CustomHouse
WoolwichSurface line
Tunnel
Portal (tunnel entrance and exit)
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UNDER OFFER
DIORLADIES &
MENS WEAR
RETAILING ON CONDUIT STREET Luxury retailers who are unable to secure representation on New and Old Bond Street are now acquiring space on Conduit Street, being a prime but comparatively affordable trading location. Conduit Street has recently been enhanced by the completion of a number of flagship retail lettings as shown on the map:
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DESCRIPTIONThe property provides an attractive 18th Century Grade II listed building with prominent frontage to Conduit Street 20’ 7 ft (6.27 m). The property is arranged over basement, ground and three upper floors providing a total net internal floor area of 4,323 sq ft (401.59 sq m) of retail and office accommodation.
The building provides retail on the ground floor with ancillary storage at basement level. The ground floor retail unit comprises a rectangular floor plate which benefits from a large sky light in the trading area. This could easily be amalgamated to create a fashion maison with retailer owner occupation potential.
Office accommodation is located on the first, second and third floors which is accessed through the shared main entrance off Conduit Street. The first floor office accommodation benefits from full height French windows and cast iron balconies overlooking Conduit Street.
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ACCOMMODATIONThe property provides the following Net Internal Areas:
Floor Use Net Internal Floor Area(sq ft) (sq m)
Basement Retail Storage
799 74.22
Ground Sales Retail 1,798 167.03
Ground ITZA Retail 658
Retail Total 2,597 241.25
First Office 596 55.37
Second Office 610 56.67
Third Office 520 48.30
Office Total 1,726 160.34
Total 4,323 401.59
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New Bur
Regent Street
Clifford Street
Old Burlington Street
Boyle Street
New Burlington Street
New Burlington Place
Savile Row
Savile Row
Offices
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OfficRetail
1-11 Heathcote House
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TENURE The property is held by way of a Virtual Freehold interest from the City of London for a term of 2,000 years from 25 December 1889, providing approximately 1,874 years unexpired, at a fixed ground rent of £7.88 per annum.
TENANCY Let in its entirety to the world famous Lalique Limited for a term of 15 years from 4th August 2008, expiring 3rd August 2023 (approximately 8 years unexpired) on full repairing and insuring terms. Surety is provided by Art & Fragrance Group.
The current rent payable is £290,000 per annum reflecting £293 Zone A and £70.00 per sq ft on the self-contained offices. There is an upward only rent review on 4th August 2018. Lalique Limited have sub-let part of the office accommodation as shown below:
Floor Tenant Area (sq ft)
Lease Expiry
Rent(psf)
1954 Act
Comment
1st Oliver Law Limited
596 26/06/2015£25,000* (£41.94)
Outside Believed to be currently holding over.
2nd Spring Films Limited
610 26/06/2015£30,000* (£49.18)
Outside Believed to be currently holding over.
Total £55,000
*All inclusive rent.
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TENANT FINANCIAL INFORMATIONLalique Limited
Lalique was first founded in 1888 and is an internationally renowned crystal manufacturer specialising in jewellery, glassware, luxury goods and high end perfume. Lalique is represented in 541 stores all over the world ranging from local community pharmacies to large destination health and beauty stores. Swiss group Art & Fragrance acquired Lalique in 2008 (under the management of Silvio Denz) and Surety is provided by Art & Fragrance Group.
For more information please visit www.lalique.com
Art & Fragrance SA
D&B Credit Rating: 4A1
Art & Fragrance Group was founded in 2000 specialising in perfumes, cosmetics, crystal glass, jewellery, high-end furniture, art and living accessories. Art and Fragrance employs over 500 staff throughout the world. The group parent company, Art & Fragrance SA, is headquartered in Switzerland and Art & Fragrance SA is listed on the BX Berne eXchange.
Art & Fragrance SA has filed the following accounts over the last two years.
Art & Fragrance SA (CHF) - Swiss Francs 2014 (CHF) - Swiss Francs 2013
Group profit before tax 400,000 31,510,000
Total current assets 376,000 3,383,000
Total equity 92,388,000 92,024,000
For more information please visit www.art-fragrance.com
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MARKET COMMENTARYRetailer demand on Conduit Street remains strong from internationally renowned retail and luxury brands. In 2014 record rents on Conduit Street were achieved at over £500 Zone A. In addition, retailers are now paying significant premiums to secure representation. This fuels rental growth in the short to medium term. The property lends its self as a headquarters fashion Maison for a continental brand looking to establish a premier representation in Mayfair.
Prime retail rents on Conduit Street compare favourably to:
Bond Street – £1,600 Zone A
Oxford Street – £1,000 Zone A
Regent Street – £675 Zone A
Albermarle Street – £600 Zone A
Dover Street – £600 Zone A
Retail Leasing Transactions:
The most recent transactions on Conduit Street in close proximity include:
Date Address Tenant Transaction Rent pa Rent Zone A
Q3 14 55 Conduit Street Vanessa Gounden OML £160,000 £443
Q3 14 52/53 Conduit Street Christian Liaigre OML £525,000 £506
Q2 14 49/50 Conduit Street DSquared OML £1,325,000 £468
In view of the latest evidence we believe the current ERV of the property to be £425,000 per annum. This assumes a Zone A rate of £475 and £75 per sq ft on the prestigious office accommodation.
Investment Transactions
London is the most globally sought after destination for international real estate capital. In 2014 the West End reached trade volumes of £5.9 billion, the fourth highest on record and 64% of which fuelled by overseas capital, with investors attracted by low interest rates, high liquidity, transparency and the long term wealth preservation that London offers.
Date Address Area (Sq ft)
Tenant Tenure Price CapitalValue (psf)
Yield
Q3 15 55 Conduit Street 1,443 Vanessa G. (UK) Ltd FH £5.1m £3,547 3.00%
Q1-15 19 Marylebone High Street 2,621 J.Crew VFH £9.5m £3,624 2.95%
Q1 15 18 Conduit Street 4,843 Vivienne Westwood VFH £10.75m £2,220 2.36%
Q4 14 4 Great Marlborough Street 3,612 Starbucks LLH £4.14m £1,146 2.97%
Q4 14 109-113 Mount Street 5,000 Moynat LLH £27.00m £4,909 1.93%
Q4 14 6 Grafton Street 13,238The Government of the Hong Kong
Special Administrative RegionFH/VFH £35m £2,643 1.12%
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VATThe property is elected for VAT and therefore it is proposed the transaction will be treated as a Transfer of a Going Concern (TOGC).
EPCThe EPC certificate is available upon request.
PROPOSALOffers are sought in excess of £14,000,000 (Fourteen Million Pounds) for the issued share capital in the BVI based SPV, subject to contract and exclusive of VAT, reflecting a net initial yield of 2.03% on the current passing rent of £290,000 per annum and a reversionary yield of 2.98% after deducting acquisition costs of 1.80%. A purchase at this level represents a capital value of £3,238 per sq ft.
CONTACT Richard Brown
020 7318 7818 / 07957 626 [email protected]
James Bramble
020 7399 5411 / 07525 907 158 [email protected]
Megan Hutchinson
020 7087 5715 / 07857 351 [email protected]
Misrepresentations Act 1967 & Declaration:
Jones Lang LaSalle for themselves and for the vendors of this property whose agents they are give notice that: a) the particulars are set out as general outline only for the guidance of intending purchasers and do not constitute, nor constitute part of, an offer or contract; b) all descriptions, dimensions, references to condition and necessary permissions for use and occupation and other details are given in good faith and are believed to be correct, but any intending purchaser should not rely on them as statements or representations of fact but should satisfy themselves by inspection or otherwise as to the correctness of each of them; c) no person in the employment of Jones Lang LaSalle has any authority to make or give any representation or warranty whatever in relation to this property. Ordnance Survey © Crown Copyright 2012. All rights reserved. Licence number 100020449. Not to scale. For indicative purposes only. October 2015
Tayler Reid I 020 7355 2500 I taylerreid.co.uk
Anthony Epenetos
020 7629 9898 / 07917 878 404 [email protected]
Andrew Knights
020 7647 4043 / 07825 742 853 [email protected]
Anthony Lorenz
020 7629 9898 / 07788 945 180 [email protected]
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